An Inquirer analysis of the care provided by Philadelphia not-for-profit hospitals painted only part of the picture (Nonprofits eyed for city revenue,” March 5).
By focusing on the approximately $70 million in charity care provided each year by the city’s hospitals, the analysis ignored nearly $378 million in unreimbursed health care services received by patients covered by Medicaid, Medicare, and other government-sponsored programs. Because these programs pay hospitals less than the cost of care, hospitals must absorb the difference. Hospitals also cover patients’ unpaid obligations (about $150 million annually) for their health care services.
As a result, Philadelphia not-for-profit hospitals contributed more than $600 million in unreimbursed care during fiscal year 2011. According to the Inquirer's analysis, that’s more than five times the worth of any real estate taxes that might be collected — and a great bargain for the health and productivity of Philadelphia.
Hospital margins in the region are slim. One in three hospitals loses money. All are reeling from the cumulative impact of years of federal cuts.