Tax-exempt hospitals contributed benefits to their communities worth an average of 12.3 percent of their total expenses in 2011, up from 11.6 percent in 2010, according to an Ernst & Young analysis conducted for the American Hospital Association.
An average of 6.1 percent of total expenses for the nearly 1,000 tax-exempt hospitals analyzed went toward charity care and losses from Medicaid and other means-tested government programs. Additionally, in 2011, 70 percent of the hospitals analyzed reported bad debt expense attributable to charity care, at an average of 1 percent of total expenses.
Furthermore, in 2011, Ernst & Young found tax-exempt hospital systems and individual hospitals spent an average of 0.15 percent of their total expenses on community building activities, such as hospital employee participation on state boards of health and donations to programs that address community health problems. General medical hospitals spent the most (0.19 percent of total expenditures) on community building.