Allocating Private Nonprofit Hospital Community Benefit Spending to Address the Needs of Socially Vulnerable Communities in California

April 6, 2021

Private nonprofit hospitals have historically allocated over 75% of their community benefit resources to patient care, but insurance coverage gains achieved through national health reform have shifted hospital investments to non-clinical community benefits for the broader community and targeted spending for vulnerable populations. However, it remains unclear whether non-clinical community benefit spending is addressing the needs of socially vulnerable populations. Recent and unprecedented levels of hospital spending to address health inequities exacerbated by the COVID-19 pandemic has highlighted the critical importance of aligning hospital community benefit spending with the disproportionate needs of socially vulnerable populations.

Our analysis of California private nonprofit hospital (n=212) community benefit spending for vulnerable populations from 2014-2016 suggests private nonprofit hospitals do not primarily make community benefit investments based on indicators of social vulnerability in their communities or target funding for socially vulnerable populations. Instead, spending was more likely associated with hospital characteristics and concentrated in communities with lower levels of need.

Key findings include:

  • Hospital size increased the likelihood of hospitals spending a high amount of community benefit for vulnerable populations, yet non-clinical community benefit spending was more likely to be targeted to the broader communities.

  • Hospitals that spend high amounts of community benefit for vulnerable populations, on average, have more total equity, provide more charity care, and spend more on total community benefit.

Consistent with other analyses, we found non-clinical community benefit spending was misaligned with health-related needs of socially vulnerable groups.

Read the full policy brief here.