As acknowledgment of the “community benefits” that they provide, the majority of hospitals in the U.S. that operate as nonprofits (about 78 percent of all US community hospitals) are exempt from most federal, state and local taxes. One of the categories of community benefit defined by the IRS, and currently ensconced in the Affordable Care Act, is health professions education. This category includes

  • Physicians, medical students, interns, fellows
  • Nurses, nursing students, other allied health professions
  • Scholarships, funding for education, continuing education

The IRS requires hospitals to submit details about community benefits on the Schedule H worksheet attached to their Form 990. The need to report quantifiable community benefits in order to maintain tax-exempt status predates the ACA, and there’s good reason to expect that reporting will continue to be necessary regardless of how forthcoming legislation may reform healthcare.

According to a 2016 Health Policy Brief from the Robert Wood Johnson Foundation, in fiscal year 2009, tax-exempt hospitals spent an average of 7.5 percent of their operating expenses on all community benefits combined. Unreimbursed costs of means-tested government programs, and subsidized health services together comprised 85 percent of aggregate community-benefit expenditures that year.

The average percentage of hospital expenditures allocated to health professions education alone, while far smaller, is the third-largest expenditure for community benefits — about 1.43 percent of total hospital spending in FY2011 (p. 9). The sheer dollar output, however, is prodigious, as this sampling from North Carolina hospitals attests:

Table 1: Value of health professions education as a community benefit reported by select North Carolina hospitals, FY2016. Source: North Carolina Hospital Assoc.

When it comes to health professions education, programs intended exclusively for hospital employees don’t qualify. And quantifying the costs of educating non-employees such as nursing students — even merely accounting for the number of students placed at an institution — can be a real logistical challenge, one that is only recently being effectively addressed by innovative tools like CB Bridges™.

Built to overcome employers’ most time-sensitive challenges, CB Bridges™ effectively streamlines the entire student clinical experience process. Along with community-benefit reporting, the wide range of additional benefits of CB Bridges™ also include

  • Centralized and standardized clinical placement process;
  • Searchable placement opportunities and online placement requests;
  • Real-time notifications when placement requests are accepted, declined or modified;
  • Schedule and assign clinical groups or individuals into facilities and units, and more.

CB Bridges™ is CastleBranch’s most comprehensive clinical compliance platform ever, built to overcome institutions’’ most time-sensitive challenges. Community benefit reporting is only one a large array of robust features that makes CB Bridges a breakthrough advantage that will keep hospitals on track through the tangle of healthcare changes to come.


This blog was produced by the tekMountain Team of Sean AhlumAmanda SipesZach Cioffi and Beth Roddy with lead writer Bill DiNome.

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