Explain the significance of 501 (c) (3) status for the hospital. Weigh the advantages and disadvantages of being a non-profit, tax-exempt organization given the context of the scenario.
It is evident that almost half of American hospitals are tax-exempt, and charitable organizations are not allowed to pay income tax (Susannah, 2016). According to Susannah (2016), this was done to facilitate the provision of better healthcare at an affordable rate to most Americans and to benefit the communities at large. Studies have established that tax-exempt hospitals are worth approximately USD 12 billion, and they are permitted to raise the tax-deductible by USD 5 billion every year. The value of tax-exempt hospitals and charitable organizations is worth more than all corporations and other businesses that are exempted from paying taxes, and therefore, the hospitals and charitable organizations benefit a lot more from tax exemption than any other institutions. In short, the section 501 (c) (3) status allows hospitals to provide better healthcare in the United States. Prior to the act exempting specific hospitals and charitable organizations from paying income tax, tax-exempt hospitals were required to provide charity care and sign obligations as well.
However, section 501 (c) (3) status allows hospitals to raise funds and offer charity care to the communities. Hospitals are also allowed to provide community healthcare for people who cannot afford to pay, and therefore, it helps tax-exempt hospitals achieve their core mandate. Lunder and Edward (2015) noted that organizations that are exempted from paying taxes under Article 501 (c) (3) are also exempted from paying both state and local taxes and bulk postage rates, which are paid by most profitable organizations. Most hospitals usually apply to be exempted from taxes due to the advantages that come with it. Nonprofit organizations that are exempted from paying taxes also enjoy corporate status, and therefore, most of them protect the founders and liabilities associated with the organization (Lunder & Edward, 2015). It, therefore, gives such an organization the power to outsource funds from donors to support certain projects or programs.
The vast majority support Section 501 (c) (3) due to its support to the hospitals. The critics argue that the standard is very vague, and it is difficult to differentiate between tax-exempt and profit-driven hospitals. It makes it difficult for people who are supposed to get healthcare services from tax-exempt hospitals to access them. The exemption, therefore, benefits the founders of such hospitals, not the public,c which is supposed to benefit first. Non-profit organizations also find it difficult to register because it requires a lot of paperwork. As stated by Susannah (2016,) since the non-profit organization is a legal entity, it has to comply with federal, state, and local laws so that it can be allowed to operate. Non-profit organizations also do not divide or share profits, and therefore, they have no other benefits besides salaries since there are strict rules in the way their assets are used (Susannah, 2016). Non-profit, tax-exempt organizations are put under public scrutiny by different institutions, such as Congress, to make sure that the right services are provided as required by the law.
Research and discuss two to three viable options the hospital may have to expand revenue given its status.
Since Sisters Charity Hospital is a tax-exempt hospital under Article 501 (c) (3), it is allowed to raise funds to support various programs and projects being undertaken by the hospital. The Sister Charity Hospital is a non-profit, and by law, it does not share profits. It mostly offers healthcare services at a reduced price and supports vulnerable families. Therefore, the hospital can expand its revenue basket through fundraising from donors, running separate business entities, such as hotels, and mobilizing financial support from the state and federal governments. According to Rosenbaum and Ross (2012), tax-exempt organizations are free to raise funds from donors, and therefore, Sisters Charity Hospitals can approach various donors to seek financial support, which can improve their revenue basket so that they can continue providing healthcare services to low-income earners across the country.
The hospital could also mobilize finances from the local, state, and federal governments to support programs that directly benefit the community. In most cases, hospitals provide charity care to low-income earners and vulnerable members of society. Through a partnership with the local, state, or federal government, the Sisters Charity Hospital can get funding for community healthcare programs, treatment of chronic diseases, and other healthcare areas where the government has an interest in improving. It could also be viable for Sister Charity Hospital to run a project or a business entity that can generate revenue for the organization. This has been done successfully by several charity organizations, and therefore, Sister Charity Hospital can employ similar tactics to increase its revenue basket.
How is the decision to build a Trauma Center related to SCH’s non-profit mission? What are some advantages of building a Trauma Center and expanding Emergency Services? Please list at least five advantages.
Sisters Charity Hospital is a non-profit organization that addresses the need for better medical services in low-income neighborhoods, and based on the hospital’s statistics, it has been providing treatment for several trauma cases. Trauma affects the well-being of a community, and since SCH has been receiving several cases, there is a need to construct a trauma to address cases related to trauma. The construction of a trauma center will help the hospital provide better medical service to affected patients. However, the construction of trauma relates to SCH’s non-profit mission in the sense that the center shall offer trauma treatment at an affordable rate compared to other hospitals. The construction of a trauma center will allow Sisters Charity Hospital to provide affordable, competent, and efficient medical services to patients. It will also make sure that the hospital is able to provide accessible emergency medical services to patients suffering from trauma.
Building a trauma center has several advantages, and it is evident that Sister Charity Hospital shall improve its service delivery to trauma patients. It will also be able to handle emergency cases without experiencing congestion in the hospital. However, the hospital will increase its revenue since it will receive several trauma patients; therefore, building a trauma center is more business, and it means more money for Sisters Charity Hospital. Hospitals are likely to get government subsidies and funds since the state and federal governments usually finance or provide certain funds to hospitals that offer trauma treatment to a community. A world-class trauma center attracts experienced and skilled surgeons, and therefore, Sister Charity Hospital is likely to get more surgeons and increase the number of recruits, which will help in improving service delivery to the people.
According to Rosenbaum and Ross (2012), trauma centers can help in building relationships between the community and the institution. The building of a trauma center is likely to improve the relationship between the SCH and the community, and this can make SCH become the preferred hospital for the community, and this can increase its revenue (Rosenbaum & Ross, 2012). The fact is hospitals are business entities, and the more patients there are, the more income there is; therefore, having good relations can help the hospital improve its revenue. The hospital is also likely to become more attractive to doctors, and hence, it will receive more trauma patients or cases, which will definitely help in generating more revenue for the organization. The construction of a trauma center will also help fund the hospitals since donors would be interested in supporting the activities of the hospital, especially the trauma center. Most importantly, the construction of trauma centers is likely to increase surgeon satisfaction and help with surgeon recruitment as well. This is because surgeons can help by calling for emergency services, and surgeons can also bring their patients for treatment. It will also improve the overall service and programs offered by the hospitals, and this will make Sisters Charity Hospital one of the best and preferred hospitals located within a community setup.
What is the basic premise of the EMTALA law? What are the legal and regulatory consequences of failing to comply with the EMTALA? How does complying with the EMTALA affect the quality of patient care?
The Emergency Medical Treatment & Labor Act (EMTALA) was enacted to make sure that everyone has access to emergency medical attention or service regardless of the ability of the person to pay. According to West (2013), the Act was passed to make sure that every American is provided with emergency medical attention. Hospitals are required to provide emergency medical examinations and treatment (West, 2013). The hospitals are required to provide necessary medical treatment to stabilize patients with EMCs. However, if the hospital is unable to stabilize a patient, an immediate transfer should be initiated to make sure that better emergency healthcare is provided to everyone. As stated by West (2013), the requirement of EMTALA is applied to Medicare or health workers working within hospitals and CAHs with licenses.
The law provides a stiff penalty for any healthcare worker or Medicare who fails to comply with the EMTALA agreement. Hospitals or Medicare providers that fail to comply with EMTALA can be deregistered, and therefore, the government can terminate the hospital or physicians’ Medicare provider agreement; therefore, it is difficult to find that hospitals are violating EMTALA law. The hospital can also be fined up to USD 50,000 for the violation of the law. In some cases, hospitals can be sued for injury and pain caused by failure to provide emergency medical attention to an individual (Hyman & Studdert, 2014). Therefore, violating EMTALA can cause both financial and public relations damage to an organization, and therefore, hospitals usually comply with the Act. However, inadequate service provisions such as screening are not considered a violation of EMTALA law.
Complying with EMTALA improves the image of a hospital, and therefore, it can receive several people seeking medical attention, hence increasing the hospital’s revenue. It is because most emergency-related causes are paid for by other organizations. According to the American College of Emergency Phtsicians (2018), EMTALA-related medical expenses are paid by American Medical Association (AMA), and insurance companies and therefore, hospital which handle EMTALA cases are likely to benefit from more revenue. It is important to note that complying with EMTALA improves the quality of patient care since Medicare providers take much time to conduct serious examinations and screening to make sure that all conditions are properly addressed. It has made emergency medical care efficient and effective because affected patients or individuals do not have to spend a longer time in the casualty area or emergency room before medical treatment is offered (American College of Emergency Physicians, 2018). It is, therefore, an essential law that has transformed the way emergency services are offered to the public.
Do you agree with the community? How does the hospital’s “case mix” factor into your decision? Do you believe that SCH could meet community needs with a Trauma Center at a lower level (Level II or III)? Why or why not?
The improvement of ED and the addition of a Level 1 trauma center are essential for the provision of efficient Medicare attention to patients. Therefore, I agree with the community that SCH should be put pressure on to improve its infrastructure. A small Trauma center cannot offer the best services to all genders, and since it has been registered that the community has experienced several cases of trauma, it would be for the benefit of the hospital and the community to improve the Trauma Center so that it can provide treatment to all genders and simultaneously. It is evident that the improvement of the trauma center to level 1 will bring several surgeons to the facility or the hospital, and therefore, the burden of booking and calling for surgeons to handle various trauma cases would automatically reduce. The SCH cannot meet the needs of the community, and it only has a trauma center at a lower level. This is because a lower-level trauma center does not attract the best surgeons since it cannot satisfy the needs of surgeons, and therefore, experienced and skilled surgeons would not be willing to be stationed at the facility.
In order to fulfill the mandate to improve emergency department services and expand its ability to treat more serious emergency trauma victims, SCH has initiated a feasibility study to decide how to respond. The study will explore:
In order to establish a well-functioning Level 1 Trauma Center, a hospital is required to have a commitment to the institution of governing and medical staff so that they can be able to manage and maintain an orthopedic center. The hospital must have enough staffs to handle trauma cases. A hospital must have physicians who are qualified to handle trauma cases. The hospital is also required to have operational equipment and operating room as well. It is, therefore, important to note that SCH has complied with major requirements to open and operate the Level I Trauma Center. It is necessary for a hospital to have a well-established emergency center to comply with the EMTALA Act, which can allow it to offer emergency medical services to the public. The SCH emergency center should be large and have well-qualified professionals so that it can offer medical services to the public without any delay.
However, for SCH to establish a Level 1 Trauma Center, it is necessary for the hospital to construct a facility or a center that will be used for the treatment of trauma cases. It is also important to employ professional physicians and surgeons so that the required manpower is available so that when the hospital inspection is carried out, the important things that are needed are available. The hospital should also have a well-maintained health system and modern equipment that can facilitate the operation of the Trauma Center. The Trauma Center must have spine Surgeons and Neurosurgeons so that all cases of trauma can be effectively handled by the hospital. It would be best for SCH to pursue these requirements since they are a must before a license is issued for any hospital to offer trauma treatment. It is also because they facilitate the operation of the trauma center, and therefore, they will make sure that trauma patients are given the best service. The trauma center must also have its own budget, medical staff, and license, which must also be issued before the trauma center is allowed to function. Therefore, a license is also needed, as well as a certificate from healthcare providers such as physicians, doctors, nurses, and other individuals who shall be involved.
References
American College of Emergency Physicians. (2018). Emergency Medical Treatment And Labor Act. https://www.acep.org/news-media-top-banner/emtala/#sm.0001tax8x15pefhnzdx24gq2eyrct , 2-38.
Hyman, D., & Studdert, D. (2014). Emergency Medical Treatment and Labor Act: What Every Physician Should Know About the Federal Antidumping Law. Journal.publications.chestnet.org , 112-182.
Lunder, E. K., & Edward, C. L. (2015). 501(c)(3) Hospitals and the Community. Prepared for Members and Committees of Congress, 2-38.
Rosenbaum, S., & Ross, M. (2012). Tax-Exempt Hospitals and the Patient Protection and Affordable Care Act: Implications for Public Health Policy and Practice. Public Health care, 2-34.
Susannah, C. T. (2016). Tax-Exempt Hospitals and Their Communities. Columbia Journal of Tax Law, 2-38.
West, J. (2013). Emergency Medical Treatment and Labor Act (EMTALA) Update. Promoting Patient Safety through EMTALA Compliance, 12-45.
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