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$20.5 million was provided by Rice Hospital in commuity benefits in '10

WILLMAR -- The handwritten notes were short but heartfelt.

"I thank you from the bottom of my heart" for receiving help from the Rice trust fund to pay a hospital bill, one person wrote. "A serious weight lifted from my shoulders and I will surely pay it forward to others in life when I am able to do so!"

Someone else sent a letter that read, "My life is much better now knowing that my bill is paid at Rice Hospital."

The city-owned hospital gave nearly $890,000 in charity care last year and provided another $850,000 in discounts to help uninsured patients reduce the size of their bill.

All told, Rice Hospital gave $20.5 million in community benefits last year, ranging from free support groups and health fairs to charity care, uncompensated care and an annual payment in lieu of property taxes to the city of Willmar.

The amount represents 20 percent of the hospital's yearly operating expenses.

The numbers were shared with the hospital board of directors Wednesday night as executives presented the annual community benefits report.

Rice Hospital is one of 130 hospitals in Minnesota that collect data on community benefits each year and report it to the Minnesota Hospital Association. The measure helps create accountability for nonprofit hospitals. Elsewhere in the U.S., some nonprofit hospitals have fallen under the scrutiny of the IRS for failing to provide enough community benefits to justify their tax-exempt status.

In many cases, programs and activities that are considered community benefits are responding to public health needs or to low-income and underserved populations, said Jackie Hinderks, director of revenue and reimbursement.

"They're services that would not otherwise be provided to the community," she said.

They also represent services that provide treatment or promote health at a cost greater than the revenue they bring in.

The amount has changed little in the past three years, hovering at 19 to 20 percent of Rice's overall yearly operating expenses.

By far, the largest share of Rice Hospital's community contributions falls in the areas of Medicare and Medicaid. Last year, payment for care provided to patients covered by these two programs fell short of the actual cost of providing care by millions of dollars -- $4.4 million for Medicaid, the publicly funded health care program for the poor, and more than $10 million for Medicare, which covers those over age 65.

"Medicare and Medicaid are not even paying at our cost," said Bill Fenske, chief financial officer.

It's a point he tries to bring up to legislators and the public at every opportunity, he said.

In 2010 Rice Hospital also paid $847,000 in MinnesotaCare taxes, made a $254,000 payment to the city of Willmar in lieu of property taxes, and wrote off $2.1 million in uncompensated care that was categorized as bad debt.

Community programs and activities such as the hospital's consumer health library, no-cost bereavement services for hospice families, job shadowing and internship opportunities for students, and the hospital's sponsorship of the annual Foot Lake 4 race were valued at $1.7 million last year.

The Willmar Ambulance Service, for instance, provides children with free basic education in First Aid and offers certified CPR and First Aid courses to local businesses, Hinderks said. Emergency medical technicians volunteer to help with car seat clinics, preschool show-and-tell and school career days.

Last year they volunteered more than 110 hours with activities that reached an estimated 31,000 people, Hinderks said. "I don't think we always realize how much effort goes forth."

Anne Polta

Anne Polta covers health care, business/economic development and general assignment. Her HealthBeat blog can be found at Follow her on Twitter at @AnnePolta.

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