WINCHESTER — Valley Health provided $72.4 million in community benefits in 2018 — $44.5 million in charity care and unreimbursed Medicaid costs and $27.8 million in outreach and health education programs.
That’s $11 million more than the $61.4 million provided in 2017 and $17.4 million more than the $55 million provided in 2016.
Valley Health, which has about 6,000 employees, is the parent company of Winchester Medical Center and five other hospitals in the region. It also has a network of urgent care centers, physician practices, and resources for rehabilitation and fitness.
The information was shared at Valley Health’s semi-annual corporation meeting on Tuesday, which was attended by about 85 stakeholders.
“In fulfilling Valley Health’s mission — serving our community by improving health — we make a substantial investment each year in outreach to the communities we serve,” Valley Health President and CEO Mark H. Merrill said. “Our new Community Benefit Report summarizes the IRS-defined work we do outside our hospitals and provides a glimpse of the ways we collaborate with other community nonprofits, educational institutions and agencies to help create healthier tomorrows.”
Community Benefit refers to healthcare and health improvement activities that non-profit hospitals and health systems undertake to address their community’s health needs. Examples include free or reduced cost healthcare to those who cannot afford it and addressing factors influencing health such as food or housing insecurity.
Non-profit or not-for-profit health systems, such as Valley Health, provide these services in lieu of paying federal income tax.
In 2018, Valley Health had $891 million in revenue and $899 million in expenses. The previous year it had $871 million in revenue and $840 million in expenses.
Had Valley Health not been exempt from income tax in 2018, its theoretical income tax liability would have been $8.8 million, according to the report. The Community Benefit supplied by Valley Health was 720.6% higher than the theoretical amount.
From 2014-18, Valley Health’s potential income tax liability was $160.5 million, while its comprehensive community contribution totaled more than $742.3 million, meaning the contribution was $581.8 million more than the projected tax obligation.
“We provide free or reduced cost healthcare for those who can’t afford healthcare,” Vice President of Ambulatory Services Chris Rucker told The Star on Wednesday. “We provide community support for factors that influence health. If you think about, there’s a lot of peripheral factors that influence health — like your ability to pay for prescription medication or access to transportation to help you get to a doctor’s appointment or even simple things like food or housing that many of us are able to fortunately take for granted. [These] are some things that many in our community can’t do. We partner with a number of organizations that address those items that influence health.”
In 2018, Valley Health joined with more than 25 community organizations to address health, wellness and welfare needs. Partners included Our Health, the Northern Shenandoah Valley Substance Abuse Coalition, free medical clinics, The Laurel Center, and United Way agencies. It also offered numerous educational programs, including sessions on medication safety, first aid, diabetes camps for youth and health fairs.
Valley Health had $80.2 million in bad debt and $17.6 million in Medicare shortfalls in 2018. If those figures are added to the $72.4 million in community benefits, the health system’s comprehensive community contributions were $170.2 million — an 18.6% increase from 2017.
Valley Health’s bad debt and Medicare shortfalls in 2017 were $62.8 million and $19.3 million, respectively.
According to Valley Health, the increase in bad debt expenses from 2017 to 2018 “is the result of decrease of public health insurance exchange plans (Affordable Care Act), resulting in an increase in uninsured individuals.”