Community Benefits Agreements

As a powerful tool to achieve better health equity, the Affordable Care Act (ACA) requires nonprofit hospitals to conduct community health needs assessments (CHNAs) every three years. The goal of a CHNA is to identify the most critical health priorities with the help of community members.  Each nonprofit hospital must complete a CHNA and develop an implementation strategy to address identified community needs in order to maintain its nonprofit status. The hospital community benefit requirements in the ACA provide unprecedented opportunities to leverage the resources of the heath care delivery and public health systems to build a more responsive, integrated system focused on building health.

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A 2017 study found that in hospital CHNAs:

• 65% cited health disparities/health equity explicitly;

• 100% referenced health equity implicitly; and

• 75% reported external stakeholders identified a need for health equity

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Yet, only 45% of nonprofit hospitals prioritized health equity in their CHNAs and only 9% included strategies to address health disparities in their implementation plans. Even more frustrating is the fact that there is no required connection between a hospital's implementation plan and community benefit expenditures, so it's impossible to tell whether hospitals are addressing the identified disparities.

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In 2011, nonprofit hospitals received over $24 billion in tax exemptions, in exchange, these hospitals are supposed to be providing community benefits. Unfortunately, there is no federal minimum level of community benefit spending required.  But states can require a minimum level of spending on community benefit. Currently Utah and Illinois require nonprofit hospitals to spend the amount of their property tax exemption on community benefits in order to quality for the tax exemption. Massachusetts' Community Based Health Initiative requires hospitals applying for a determination of need to connect to their spending on identified priorities. In 2019, Oregon created a minimum community benefit spending floor for nonprofit hospitals.

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There is no minimum community benefit spending requirements in Wisconsin. So advocates are insisting nonprofit hospitals in our state - such as St. Joseph's Hospital in Milwaukee - commit to investing funds into their local communities through community benefits agreements.

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A CBA is an explicit agreement between community groups and a private company that receives public subsidies, such as a real estate developer or a nonprofit hospital. The agreement outlines the specific community benefits that the private entity will provide in response to community-identified needs. It is a legally-binding agreement with a coalition of neighborhood associations, faith-based organizations, unions, environmental groups, and others representing the interests of the community served.

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CBAs are increasingly common with private developers that receive public subsidies. When the Milwaukee Bucks received public money to build a new basketball arena, the team entered into a binding, legally-enforceable agreement to hire staff from underdeveloped neighborhoods and to pay living wages. An example of a CBA between a community coalition and a nonprofit hospital can be found at the University of Pittsburgh Medical Center, where the agreement establishes explicit requirements for medical service expansion, local hire, and job training, among other provisions.

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Examples of Hospital Community Benefit:

Case Study: Linking Healthy Community Design with CHNA - Economic development in Cleveland, Ohio

Evergreen Cooperatives & Greater University Circle Initiative - Cleveland Clinic Health System, University Hospitals System

CHNA Identified Need: Economic opportunity

Description: Cleveland, Ohio has suffered from high unemployment rates since the Great Recession. The Greater University Circle Initiative is a collaborative effort dedicated to leveraging the economic strength of the urban anchor institutions. The Evergreen Cooperative Initiative was developed to create living wage jobs for the low-income neighborhoods within the Greater University Circle. The Cooperatives include three separate businesses: 1) Evergreen Cooperative Laundry, 2) Evergreen Energy Solutions and 3) Green City Growers Cooperative. The employee-owned businesses are tapping into the supply chain of Cleveland's anchor institutions to provide products and services.

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Case Study: Linking Healthy Community Design Activities with CHNA - Physical improvements and housing in North Phoenix, Arizona

Desert Mission Neighborhood Renewal and John C. Lincoln - North Mountain Hospital

CHNA Identified Need: Stable housing

Description: Desert Mission Neighborhood Renewal is a community development corporation dedicated to the development of housing, neighborhoods and businesses in North Phoenix. Core programs and services include: 1) Housing counseling and home-buyer assistance, 2) infill affordable housing and homeowner rehabilitation and 3) commercial development and redevelopment.

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Case Study: Linking Healthy Community Design Activities with CHNA - Food security in Northern Virginia and Washington DC

Inova Health Systems

CHNA Identified Need: Food insecurity

Description: The SNAP Double Dollars Program in an incentive program designed to encourage SNAP recipients to purchase fresh, local foods at farmers markets. Shoppers at participating markets receive $10 in matching funds for SNAP purchases of fresh fruits and vegetables.

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