The State Treasurer of North Carolina Dale Folwell released a report on Wednesday, Oct. 27, that revealed Cone Health and the majority of nonprofit hospitals in the state are not meeting their obligations for charity care.
The report based an analysis by the John Hopkins Bloomberg School of Public Health and the North Carolina State Health Plan found disparities in the charitable care spending by most North Carolina nonprofit hospitals.
According to the report, Cone Health received tax exemptions of $131.6 million in 2020 but only spent $105.7 million on charitable care.
Wake Forest Baptist Health received $210.3 million in tax exemptions and spent $54.8 million on charitable care.
WakeMed Health and Hospitals was one of the fewer than 25 hospitals that exceeded the value of their tax exemption with the amount of charity care spending in the state. WakeMed received $81.2 million in tax exemptions and spent $102.4 million on charitable care.
In a press release Folwell said, “Charity care is the heart of what it means to be a nonprofit hospital. Our hospital systems justify overcharging state employees and taxpayers by pointing to their charity care costs. But now we know that is not fully accurate. They are profiting on the backs of sick patients.”
Dr. Ge Bai, a professor at the John Hopkins Carey Business School and Bloomberg School of Public Health, said, “With tax subsidy comes social responsibility. Nonprofit hospitals must demonstrate distinctive charitable behaviors to deserve their tax-exempt status and the public’s trust.”
The report notes that on average North Carolina hospitals were far more profitable than the national average. But one in five families in the state has medical debt in collections.
Folwell noted that there is little oversight and no enforcement of charity care spending in the state. He said, “It appears that no one is holding hospitals accountable for the way they treat the poor. Instead, North Carolina enables bad actors to pocket their tax breaks instead of paying them back to their communities. We must support the hospitals who do serve their communities and require the others to step up.”