“Hospital community benefit”: Remind me, what Is That again?

In our experience, when colleagues in health philanthropy hear the phrase “hospital community benefit,” their eyes begin to glaze over. We don’t blame them. It’s a unique and changing corner of the health philanthropy world, manifesting itself in different ways according to states’ varying regulations and differing organizational goals. Unless they’ve worked alongside a hospital on a community health initiative, grantmakers may not be aware of the opportunities in this field.

Nonprofit hospitals, in order to maintain their tax-exempt (or “charitable”) status, under section 501(c)(3) of the federal Internal Revenue Code, are required to provide benefit to the communities they serve. Before the Affordable Care Act (ACA), hospitals had a significant amount of latitude in determining what activities and services constituted community benefit.

As a result, there has been variation in what is considered a community benefit activity and how to measure its value. In its most basic form, community benefit historically has entailed careful accounting for uncompensated care. If the resulting write-off was sufficient to meet regulatory requirements, hospital finance staff would simply report the numbers.

Here in California, since the late 1990s, nonprofit hospitals have been subject to requirements to assess community health needs, and then respond to those needs, on a regular basis. A version of this regulatory framework was scaled up to the national level following the passage of the ACA, requiring nonprofit hospitals to assess community needs in a robust and data-driven fashion, and articulate how they plan to use their community benefit programs and funds to respond to those needs.

As a result, hospital community benefit programs are catching up to the rest of health philanthropy in terms of best practices related to disease prevention and addressing social determinants of health (such as the built environment, education, and safe and affordable housing).

Keeping the community health needs assessment relevant

If community benefit contains the grant making and program administration conducted by nonprofit hospitals, then the community health needs assessment is best understood as the data and findings that serve as the precursor to the strategic plan for those activities. Conducted every three years, the needs assessment gathers data (primary and secondary, qualitative and quantitative) to produce a list of several community health needs. From this list, hospitals choose a handful of priorities, and those priorities become the drivers of the community benefit activities for the ensuing three years.

While in the field of private health philanthropy, concepts of social determinants of health and disease prevention have become commonplace for some time, hospital community benefit has remained more focused on disease states or “downstream” conditions. Many community health needs assessments focus on chronic conditions like heart disease, cancer, and type 2 diabetes. The field had generally not used health philanthropy or public health principles of prevention-oriented interventions. This has changed as hospitals themselves have evolved to focus more on population health initiatives and community wellness—a shift for which evolving health policy and reimbursement changes can no doubt take some credit.

Last year, in Northern California, the Sonoma County Community Health Needs Assessment Collaborative set out to produce the next required assessment. The group, which since the year 2000 has included the three largest hospitals in the county as well as the county’s Department of Health Services, expanded to include the smaller district hospitals throughout the county as well. Organizations represented on the collaborative’s Steering Committee are the following: Kaiser Permanente Santa Rosa Medical Center, St. Joseph Health-Sonoma County (an integrated delivery system), Sutter Santa Rosa Regional Hospital, and County of Sonoma Department of Health Services. Other collaborative members are Healdsburg District Hospital, Palm Drive Health Care District, and Sonoma Valley Hospital.

This assessment process began in the context of a larger and longer-term conversation about broadly defining community health and collaboratively working to improve it. Before this, in 2015, the county had produced and released A Portrait of Sonoma County, a report that starkly portrayed disparities within the county among neighborhoods and along the lines of race, ethnicity, and gender.

Sonoma Health Action, a collective impact initiative that has set the ambitious goal of helping our county become the healthiest in the state, has been working to change the conversation around what determines good health and how to effect positive outcomes on a variety of metrics for everyone in Sonoma County.

In this context, the community health needs assessment began to feel less like a static document meant to fulfill a regulatory requirement, and more like the next chapter in a larger ongoing conversation about prevention and the social determinants of health. Our collaborative decided to produce a report on the needs assessment process that would serve as a tool for community engagement that could help inform planning and spur other related efforts to improve community health and reduce disparities. To lead the work, we hired Harder+Company Community Research, a consulting firm that uses community-based evaluation and research methods to examine social determinants of health, develop strategies to promote health equity, and engage communities in identifying solutions.

Our results

As noted above, the process for data collection included active community engagement to inform the needs assessment. Our group conducted multiple focus groups throughout the county and centered them on areas that were identified as high-need neighborhoods by the Portrait report. We also conducted twenty key informant interviews with local stakeholders and leaders to hear about their own experiences and observations regarding health issues in specific communities.

Combining these qualitative results with numerous quantitative data indicators (for example, from the US Census and the California Health Interview Survey [CHIS]) established a draft list of priorities. We then engaged several dozen community members in a “prioritization day,” in which stakeholders—including staff from hospitals, public health, and social service providers, and even residents—had the opportunity to learn about the findings for each health priority and rank them. Obtaining input from such a broad cross-section of stakeholders helped ensure a collective approach to prioritizing health needs and helped keep the focus on key drivers of health, including social determinants.

The results of this session produced three tiers of identified needs: highest, higher, and high. As we had guessed at the outset, our larger community of stakeholders is very concerned about upstream determinants of health, as evidenced by their selection of priorities.

Sonoma County Community Health Needs Assessment’s Highest-Tier Health Needs
1.    Early Childhood Development. Child development includes the rapid emotional, social, and mental growth that occurs during gestation and early years of life.
2.    Access to Education. Educational attainment is strongly correlated to health: people with low levels of education are prone to experience poor health outcomes and stress, whereas people with more education are likely to live longer, practice healthy behaviors, experience better health outcomes, and raise healthier children.
3.    Economic and Housing Insecurity. Economic resources such as jobs paying a livable wage and stable and affordable housing, as well as access to healthy food, medical care, and safe environments can impact access to opportunities to be healthy.

What’s the big deal?

As community health needs assessments expand to focus on a broader array of health issues and social determinants of health, we can expect hospital community benefit resources to follow in that direction. National hospital community benefit regulations are more robust than ever, meaning that similar definitional expansions are occurring, or are poised to occur, in communities across the country.

Health funders, in particular, as experts in the theory and practice of addressing disparities, can play an important leadership role in ensuring the needs assessment process focuses on more than disease states and includes examining key drivers of health. Moreover, hospitals and funders in a given region should work together to promote a collaborative approach to the needs assessment process to build upon resources, knowledge, and community engagement to ensure that the process results in useful data that can drive community health improvement efforts.

Additionally, the nature of the issues that will emerge through assessments that rest on an expanded definition of health imply that no one organization—nonprofit hospital, private health foundation, or other entity—can address identified community needs with the limited dollars available to each of them. Collaborative approaches to understanding community needs and aligning strategies to address them are needed to avoid duplication of efforts; build upon local, state, and regional funds; and ultimately expand impact on a local level.

Health funders have an important role to play in this evolving field: leading efforts to forge stronger partnerships and invest in upstream efforts to improve community health over the long term.

Sonoma County Community Health Needs Assessment Collaborative Steering Committee members:

Carl Campbell and Jeannie Dulberg, Kaiser Permanente Santa Rosa Medical Center

Matthew Ingram, St. Joseph Health-Sonoma County

Penny Cleary, Sutter Santa Rosa Regional Hospital

Jen Lewis, Karen Milman, and Brian Vaugh, Sonoma County Department of Health Services

Health Affairs related reading:

Melinda Chen of Weill Cornell Medical College and coauthors, “Hospitals’ Engagement in Population Health: Moving Past the Medicine and into the Community,” Health Affairs Blog, April 5, 2016.

Health Affairs-Robert Wood Johnson Foundation Health Policy Brief, “Nonprofit Hospitals’ Community Benefit Requirements,” February 25, 2016.

C.J. Eisenbarth Hager of Vitalyst Health Foundation (formerly St. Luke’s Health Initiatives), “Hospital Community Benefit: How Partnerships Can Support Healthy Communities,” GrantWatch section of Health Affairs Blog, October 22, 2015.