Iowa Health System's Benefit to our Communities

Iowa Health System and its affiliates provide significant benefits to our communities. In addition to the Internal Revenue System (IRS) defined community benefit contributions, Iowa Health System and its affiliates have, or incur, additional costs in order to provide patient care. Community benefit, other uncompensated care and taxes are significant additional costs that Iowa Health System entities incur in providing patient care. Iowa Health System providers must balance their obligations as tax exempt entities to provide benefits to our communities, including uncompensated care, with their responsibilities to maintain their existence and continue to provide needed health care services to the communities.                  
    

2008 Summary: Community Benefit, Other Uncompensated Care and Taxes  $  Amount Percent of Expenses 
Total Community Benefit  $ 136,976,813 7.03 Percent
Total Cost of Other Uncompensated Care $ 136,040,454  6.99 Percent
Total Taxes $ 67,832,566  3.48 Percent
Total Community Benefit, Other Uncompensated Care and Taxes  $ 340,849,833  17.5 Percent

Charity Care and Community Benefit

Iowa Health System and its affiliates provide patient care to a growing number of uninsured and underinsured patients. Patients are responsible for a greater burden of their health care costs through growing out-of-pocket deductibles that many health insurance plans, including Medicare, have implemented. And many patients lack the financial resources to secure health insurance.  Accordingly, Iowa Health System has developed financial policies to seek fair and equitable payment from patients based on their ability to pay. At the same time, Iowa Health System assists patients who cannot reasonably pay for some or all of the care they receive.

View our Discounts for Uninsured Patients policy.
View our Financial Assistance policy.

Additionally, Iowa Health System and its affiliates offer a wide range of community services at no or minimal cost to the recipient. These community services include community education, immunizations, reduced fee clinics and medical education. All are part of the total community benefit provided by Iowa Health System and its affiliates.

2008 Summary: Community Benefit and Community Building Activities

 $  Amount Percent of Expenses
  Charity care at cost   35,060,791 1.80 Percent
  Unreimbursed Medicaid $   61,804,772 3.17 Percent
  Unreimbursed Costs - Other Means-Tested Government Programs $   4,678  0.00 Percent
Total Charity Care and Means-Tested Programs $ 96,870,241  4.97 Percent
  Community Health Improvement Services and Community Benefit Operations $  9,885,871  0.51 Percent
  Health Professions Education $  9,567,964  0.49 Percent
  Subsidized Health Services  $  7,966,720  0.41 Percent
  Research $  602,489  0.03 Percent

  Cash and In-Kind Contributions to Community Groups 

 $   8,545,313  0.44 Percent

Total Other Benefits

 $  36,568,357  1.88 Percent
Total Community Building Activities  $  3,538,215  0.18 Percent


Total Community Benefit 


$ 


136,976,813

 7.03 Percent

Cost of Other Uncompensated Care

In addition to the IRS defined community benefit, Iowa Health System and its affiliates provide additional services for which they are not compensated. Uncompensated care is an overall measure of hospital and provider care for which no payment was received from the patient or insurer. The IRS definition of community benefit includes charity care and unreimbursed Medicaid. However, uncompensated care also includes bad debt and unreimbursed Medicare. Other Uncompensated Care reports the cost of bad debt and unreimbursed Medicare that is not included in the IRS definition of community benefits, since it is an important and significant cost to nonprofit hospitals and providers.

 

2008 Summary: Cost of Other Uncompensated Care  $  Amount  Percent of Expenses 
Bad Debt (Uncollectible charges excluding contractual adjustments, arising from the failure to pay by patients whose health care has not been classified as charity care.)  $   24,702,312 1.27 Percent 
Uncompensated Medicare (Cost of providing services that Medicare doesn't pay.)  $ 111,338,142  5.72 Percent
Total Cost of Other Uncompensated Care  $ 136,040,454  6.99 Percent 

Taxes

Although Iowa Health System and its affiliates are exempt from federal income tax under IRC section 501(c)(3) as charitable organizations, Iowa Health System is legally obligated to make tax payments in the form of state sales taxes, real estate, or property taxes, and federal and state income taxes paid by a variety of Iowa Health System affiliated entities for a total of $7.8 million in 2008. In addition, Iowa Health System paid taxes related to employee payroll taxes (employer portion of Social Security and Medicare) of $60 million. This combined $67.8 million, while not included in Iowa Health System's IRS community benefit reporting, provides additional insight into the substantial amount of taxes paid by Iowa Health System entities.

 

2008 Summary: Taxes  $ Amount  Percent of Expenses
Income, Property and Sales Taxes  $ 7,824,096  0.40 Percent 
Payroll Taxes  $ 60,008,470  3.08 Percent 
Total Taxes  $ 67,832,566  3.48 Percent