Topic List Topic: Community Benefit or Community Building Program
(November 2015) Topic: Community-wide Quality Improvement/Care Coordination Efforts
(March 2013) Topic: Educating Hospitals About Successful Environmental Practices
(August 2009) Topic: Food Policy/Leadership Councils
(August 2013) Topic: Physician Recruitment
(March 2013; Updated November 2015) Topic: Sustainable Farming
(March 2013) Please Take Note: The information provided below does not constitute legal or tax advice. The material is provided for informational/educational purposes only. Please consult with counsel regarding your organization's particular circumstances.
Topic: Community Benefit or Community Building Program
Question: How do I determine whether to count a social and/or environmental improvement activity under category A4 or Community Building?
Recommendation: Social and Environmental Improvement Activities are programs and activities that improve the health of persons in the community by addressing the determinants of health, which includes the social, economic and physical environment. They may be related to activities in Category F: Community-Building (physical improvements and housing, economic development, community support, environmental improvements, leadership development, coalition building, community health improvement advocacy and workforce development). These activities can be reported as community health improvement under A4 when they meet the criteria for community benefit described in the GUIDE Chapter 2 (which are - provided in response to identified community health needs and meet at least one of the following community benefit objectives: improve access, enhance population health, advance knowledge, relieve government burden; not excluded as marketing benefiting the organization more than community, restricted to staff, or cost of doing business) and are not reported in Category F.
Topic: Community-wide Quality Improvement/Care Coordination Efforts
Question: Our hospital is participating in a two county community collaborative in partnership with the local area agency on aging to prevent hospital readmissions. Two hospitals have started a pilot program while the collaborative has written a grant to the Centers for Medicare and Medicaid Services. The community need the collaborative is addressing is improving access to health services and relief of government burden. The collaborative has many community partners.
Can we report as community benefit the time spent by staff in collaboration meetings, steering committee meetings, planning, data collection and reporting, making referrals to Coleman coach, etc.? We are not sure if efforts to prevent hospital readmissions are part of the continuum of care/care coordination and should not be reported as community benefit.
Recommendation: We recommend reporting quality improvement/care coordination efforts when 1) the primary purpose of the activity is to provide community benefit (improved access or community health improvement, and not to the benefit the organization financially), 2) there is an identified community need for the program (need may be demonstrated by involvement/request of government and/or community groups) and 3) at least one of the following apply:
- The persons receiving the services are vulnerable (low income, mentally ill, homeless or in other ways in need of special services)
- The program is part of a community response to an identified community health need, involving one or more community partners
We recommend being cautious in reporting services where there is a return on investment to the organization, such as avoidance of readmission penalties. However, reducing readmissions should not automatically disqualify an activity from being reported because the admission being prevented may be to another hospital and the reduction in costs benefit the overall health care system. Also, as some of these services become standards of care, expected and performed by all organizations, this recommendation will be revised.
If the activity is reported, all costs can be reported including time spent by staff in collaboration meetings, steering committee meetings, planning, data collection and reporting, making referrals to coaches. We recommend reporting under Category A4, Social and Environmental Improvement Activities.
Topic: Educating Hospitals About Successful Environmental Practices
Question: We are a nationally recognized, award winning, environmentally-friendly facility. Representatives from facilities across the county visit us and we teach them how to implement our successful practices. Is this community benefit? We realize we are helping organizations outside of our community and the issue we are addressing is internal environmental responsibility.
Recommendation: CHA contacted the IRS about your question. The IRS staff we consulted stated that this would not qualify as community benefit because it's not explicitly health-related education. Nor would it be a community building activity, because it's not an activity that the organization is conducting to improve health or safety in its own community. It may be an activity that furthers tax-exempt purposes and it could be reported in Part III of the Form 990, but not on the Schedule H.
Topic: Food Policy/Leadership Councils
Question: Employees of our hospital serve in leadership roles of our Food Leadership Council. The council works to move local sustainable food purchasing forward for many hospitals and other institutions in our community, which results in increased access to healthier foods through distributors, and thus in the community. Can we claim their meeting and travel time in the hospital’s community benefit report?
Recommendation: The cost of employees serving on local Food Leadership Council can be reported as community benefit in the following circumstances:
- The work of the Food Leadership Council is related to an identified community health need
- The purpose of the Council is to improve community health (or another community benefit objective)
- The time reported spent on the Council is related to community health improvement (as opposed to the hospital's community food service needs). Ideally the hospital should be able to show/document that their time is not solely devoted to meeting their own hospital's food service needs, i.e. ordering their own food.
Topic: Physician Recruitment
Question: When should recruitment of physicians be reported as community benefit and what can we count?
Recommendation: We recommend that physician recruitment costs be reported as community benefit/community health improvement in category A4: Social and Environmental Improvement Activities even though "workforce development" appears in the IRS Form 990 Schedule H in Part II, Community Building because recruitment for physicians in response to community health needs expands access and can improve community health and thus meet the criteria for community health improvement.
Report physician recruitment costs as community benefit when the organization can document the need for recruiting physicians. This can be demonstrated by:
- Community's official designation as a Health Professional Shortage Area or Medically Underserved Area.
- Findings of a community-need assessment, particularly identification of a need for access to primary or specialty care by low-income and other vulnerable persons.
- Physician shortage identified when compared with national recommendations.
- Physician is needed to provide a qualifying subsidized activity, for example psychiatrists need to provide mental health services.
Be sure to apply the "prudent layperson" criteria. For example, do not include recruitment of a physician to support a profitable service. Also, we recommend that agreements with recruited physicians include responsibilities to care for underserved persons and populations.
All recruitment costs for targeted physicians (such as interview airfare/hotel, loan forgiveness (student loans and loans for starting practices), signing bonus, income guarantees) can be counted. In accounting for costs such as loans, report the cost in the year in which the expenditure is made.
(Updated November 2015)
Topic: Sustainable Farming
Question: Our hospital is involved in a community-wide environmental sustainability project and I was wondering if any of the components could be reported as community benefit.
The program has three components:
- Composting — done with other large institutions and the local farmer's market
- DIRT project — school based education on where food comes from. Goal is to address obesity by changing eating habits. Most of the schools where program is offered serve low-income students.
- Our hospital will provide land for a farm. A coalition will run the farm and train farmers in sustainable farming techniques. The food will be used by our hospital and the local farmer's market.
The identified need for these programs is obesity, which was identified as a major problem in our hospital's health assessment. While the community the hospital serves is not a typical food desert most of the food available to the community is produced through industrial agriculture which is not as healthy as the food produced through more sustainable methods…so in a sense the community is in a type of food desert. We feel that composting and farmer training are community building because these activities build capacity to produce foods without heavy use of pesticides and fertilizers — which can have harmful effects on health.
Recommendation: We recommend reporting activities related to increasing the availability of healthier food (including composting, education programs about healthy foods and where they come from, and sustainable farms) when the following apply:
- There is an identified community health need related to availability of healthy food, for example, obesity, diabetes heart disease and other conditions;
- The root cause of the identified need is related to the activity, for example, lack of availability of healthy food, lack of knowledge about healthy food, and
- The activity is part of a community-wide (at least one community partner) plan to address the health problem by increasing the availability of healthier foods or an overall facility plan to address the health problem by increasing the availability of healthier foods.
These activities would be reported in category A4, Social and Environmental Improvement Activities. In reporting such activities, report only the cost to the organization. For example, if an organization provides land for a farm, there must be an actual cost for this.