Code Section Group

Health and Safety Code - HSC

DIVISION 107. STATEWIDE HEALTH PLANNING AND DEVELOPMENT [127000 - 130070]

  ( Division 107 added by Stats. 1995, Ch. 415, Sec. 9. )

PART 2. HEALTH POLICY AND PLANNING [127125 - 127686]

  ( Part 2 added by Stats. 1995, Ch. 415, Sec. 9. )

CHAPTER 2. Health Policy Research and Evaluation [127340 - 127360]

  ( Chapter 2 heading added by Stats. 1995, Ch. 415, Sec. 9. )

ARTICLE 2. Hospitals: Community Benefits [127340 - 127360]
  ( Article 2 added by Stats. 1996, Ch. 1023, Sec. 353. )

127340.
  

The Legislature finds and declares all of the following:

(a)  Private not-for-profit hospitals meet certain needs of their communities through the provision of essential health care and other services. Public recognition of their unique status has led to favorable tax treatment by the government. In exchange, nonprofit hospitals assume a social obligation to provide community benefits in the public interest.

(b)  Hospitals and the environment in which they operate have undergone dramatic changes. The pace of change will accelerate in response to health care reform. In light of this, significant public benefit would be derived if private not-for-profit hospitals reviewed and reaffirmed periodically their commitment to assist in meeting their communities’ health care needs by identifying and documenting benefits provided to the communities which they serve.

(c)  California’s private not-for-profit hospitals provide a wide range of benefits to their communities in addition to those reflected in the financial data reported to the state.

(d)  Unreported community benefits that are often provided but not otherwise reported include, but are not limited to, all of the following:

(1)  Community-oriented wellness and health promotion.

(2)  Prevention services, including, but not limited to, health screening, immunizations, school examinations, and disease counseling and education.

(3)  Adult day care.

(4)  Child care.

(5)  Medical research.

(6)  Medical education.

(7)  Nursing and other professional training.

(8)  Home-delivered meals to the homebound.

(9)  Sponsorship of free food, shelter, and clothing to the homeless.

(10)  Outreach clinics in socioeconomically depressed areas.

(e)  Direct provision of goods and services, as well as preventive programs, should be emphasized by hospitals in the development of community benefit plans.

(Added by Stats. 1996, Ch. 1023, Sec. 353. Effective September 29, 1996.)

127345.
  

As used in this article, the following terms have the following meanings:

(a)  “Community benefits plan” means the written document prepared for annual submission to the Office of Statewide Health Planning and Development that shall include, but shall not be limited to, a description of the activities that the hospital has undertaken in order to address identified community needs within its mission and financial capacity, and the process by which the hospital developed the plan in consultation with the community.

(b)  “Community” means the service areas or patient populations for which the hospital provides health care services.

(c)  Solely for the planning and reporting purposes of this article, “community benefit” means a hospital’s activities that are intended to address community needs and priorities primarily through disease prevention and improvement of health status, including, but not limited to, any of the following:

(1)  Health care services, rendered to vulnerable populations, including, but not limited to, charity care and the unreimbursed cost of providing services to the uninsured, underinsured, and those eligible for Medi-Cal, Medicare, California Childrens Services Program, or county indigent programs.

(2)  The unreimbursed cost of services included in subdivision (d) of Section 127340.

(3)  Financial or in-kind support of public health programs.

(4)  Donation of funds, property, or other resources that contribute to a community priority.

(5)  Health care cost containment.

(6)  Enhancement of access to health care or related services that contribute to a healthier community.

(7)  Services offered without regard to financial return because they meet a community need in the service area of the hospital, and other services including health promotion, health education, prevention, and social services.

(8)  Food, shelter, clothing, education, transportation, and other goods or services that help maintain a person’s health.

(d)  “Community needs assessment” means the process by which the hospital identifies, for its primary service area as determined by the hospital, unmet community needs.

(e)  “Community needs” means those requisites for improvement or maintenance of health status in the community.

(f)  “Hospital” means a private not-for-profit acute hospital licensed under subdivision (a), (b), or (f) of Section 1250 and is owned by a corporation that has been determined to be exempt from taxation under the United States Internal Revenue Code. “Hospital” does not mean any of the following:

(1)  Hospitals that are dedicated to serving children and that do not receive direct payment for services to any patient.

(2)  Small and rural hospitals as defined in Section 124840.

(g)  “Mission statement” means a hospital’s primary objectives for operation as adopted by its governing body.

(h)  “Vulnerable populations” means any population that is exposed to medical or financial risk by virtue of being uninsured, underinsured, or eligible for Medi-Cal, Medicare, California Childrens Services Program, or county indigent programs.

(Added by Stats. 1996, Ch. 1023, Sec. 353. Effective September 29, 1996.)

127350.
  

Each hospital shall do all of the following:

(a)  By July 1, 1995, reaffirm its mission statement that requires its policies integrate and reflect the public interest in meeting its responsibilities as a not-for-profit organization.

(b)  By January 1, 1996, complete, either alone, in conjunction with other health care providers, or through other organizational arrangements, a community needs assessment evaluating the health needs of the community serviced by the hospital, that includes, but is not limited to, a process for consulting with community groups and local government officials in the identification and prioritization of community needs that the hospital can address directly, in collaboration with others, or through other organizational arrangement. The community needs assessment shall be updated at least once every three years.

(c)  By April 1, 1996, and annually thereafter adopt and update a community benefits plan for providing community benefits either alone, in conjunction with other health care providers, or through other organizational arrangements.

(d)  Annually submit its community benefits plan, including, but not limited to, the activities that the hospital has undertaken in order to address community needs within its mission and financial capacity to the Office of Statewide Health Planning and Development. The hospital shall, to the extent practicable, assign and report the economic value of community benefits provided in furtherance of its plan. Effective with hospital fiscal years, beginning on or after January 1, 1996, each hospital shall file a copy of the plan with the office not later than 150 days after the hospital’s fiscal year ends. The reports filed by the hospitals shall be made available to the public by the office. Hospitals under the common control of a single corporation or another entity may file a consolidated report.

(Added by Stats. 1996, Ch. 1023, Sec. 353. Effective September 29, 1996.)

127355.
  

The hospital shall include all of the following elements in its community benefits plan:

(a)  Mechanisms to evaluate the plan’s effectiveness including, but not limited to, a method for soliciting the views of the community served by the hospital and identification of community groups and local government officials consulted during the development of the plan.

(b)  Measurable objectives to be achieved within specified timeframes.

(c)  Community benefits categorized into the following framework:

(1)  Medical care services.

(2)  Other benefits for vulnerable populations.

(3)  Other benefits for the broader community.

(4)  Health research, education, and training programs.

(5)  Nonquantifiable benefits.

(Added by Stats. 1996, Ch. 1023, Sec. 353. Effective September 29, 1996.)

127360.
  

Nothing in this article shall be construed to authorize or require specific formats for hospital needs assessments, community benefit plans, or reports until recommendations pursuant to former Section 127365, as added by Chapter 1023 of the Statutes of 1996, are considered and enacted by the Legislature.

Nothing in this article shall be used to justify the tax-exempt status of a hospital under state law. Nothing in this article shall preclude the office from requiring hospitals to directly report their charity activities.

(Amended by Stats. 2004, Ch. 193, Sec. 131. Effective January 1, 2005.)

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