More transparency urged on tax donation program
♦ Polk Medical Center reported recent use of funds for senior transport van upgrade and more
Tens of millions of dollars in business and individual donations have gone to Georgia rural hospitals this year, thanks to a popular state tax credit program.
But how hospitals are spending that money this year has not been officially tracked, the state says. And right now, there apparently isn’t publicly available information on how much in donations that each eligible hospital has received so far in 2018.
An influential state lawmaker said last week that the law needs tweaking to increase transparency. “There are things that need to be cleaned up,’’ said Rep. Terry England (R-Auburn), chairman of the House Appropriations Committee.
Last week, in a surprise announcement, the state Department of Revenue said that the program would be reopened for donations because it hadn’t reached the $60 million limit in tax credits awarded.
The agency did not say how much of the $60 million in tax credits remained untapped, but a spokesman, William Gaston, said the department would know more on the amount closer to the Nov. 15 start of new applications.
Rural hospital donations have soared this year after the Legislature decided to raise the tax credit to 100 percent of donations, up from 90 percent. The program now allows a dollar-for-dollar reduction on state income taxes for those who file as individuals, couples or corporations in the state.
Polk Medical Center is among the hospitals that is taking part in the program, and received around $500,000 in donations thus far since its inception several years ago.
They join some hospitals who are reporting how they use the money publically.
Floyd Healthcare Vice President Matt Gorman told Cedartown-Polk County Hospital Authority members during their October meeting that some of that money has already been put to good use. They used some of the donated funds, along with the Polk Medical Center’s Spirit Committee and some hospital general funds to purchase a new van to use for transporting seniors as part of their enrichment program to and from meetings and events sponsored by the hospital.
“As part of that program, we have an outreach where we have a van to go pick up those people,” he said. “That van outreach is really important to the participants in that program.”
He said the old van the hospital was using to transport seniors was well past its prime, and was constantly being repaired.
“Both of those organizations came together to give us money to help us replace the van,” he said. “It’s been fantastic. The air and heat works, and we don’t have to take it to the shop all the time.”
Gorman said the van was purchased with “almost no operational cost to the hospital.”
The Polk Healthcare Foundation is also using some of the funds to help provide locally grown produce to people in need via the annual Youth Summerfest, and regularly through Community Share Ministries and Piedmont Avenue Baptist Church.
Others are talking about how they’ve used the money as well.
Phoebe Worth in Sylvester said recently that it received donations totaling $2.5 million through Georgia HEART, a consulting firm employed by many rural hospitals to facilitate donations.
“It will allow us to pay for ongoing renovations to our facility, to buy new equipment and to recruit and retain wellqualified physicians and other clinicians who will provide quality care to patients right here in Worth County,” said CEO Kim Gilman, according to the Albany Herald
Meanwhile, donors gave $901,000 to Phoebe Sumter, which said it expected to use its donations for upgrading equipment for clinical services, expanding clinical service offerings and community health initiatives, hiring new physicians and offsetting the cost of uncompensated care.
A lifeline for struggling systems
The tax credit program was created to address the lingering rural health crisis in Georgia.
Seven rural hospitals in the state have closed their doors since the beginning of 2013. Two of those have been reopened as modified medical facilities, but no longer function as full-fledged hospitals.
More than half of the state’s remaining rural hospitals are vulnerable to closure, according to a 2016 report on rural hospital strength by iVantage Health Analytics for the National Rural Health Association.
Last year’s total state donations under the program – at the 90 percent level – was just $10 million, out of a possible $60 million.
This year, the program has been considered such a success among lawmakers and hospitals that there are proposals to raise the ceiling of tax credits from $60 million to $100 million.
Some hospitals have announced their collections and spending plans in the media.
“Hospitals are thrilled to death’’ about the tax credit program, England said.
Legislators “are going to put things in place to see how these dollars are being spent’’ to increase transparency, said England, who’s also co-chair of the House Rural Development Council. “We want to be specific on allowable spending.”
“This is taxpayer money that would otherwise go into the General Fund,’’ England told GHN. “Every one of these hospitals want to do the right thing. I want to identify how the money is spent.”
The state Department of Community Health noted Tuesday that under the law, hospitals must report next year how much donation money was collected in 2018, and about its spending of those dollars.
Ethan James of the Georgia Hospital Association said Tuesday that hospitals ‘’have been fully compliant on the transparency that’s called for under the law.”
But during the year, progress reports on collections and spending is needed, said Jimmy Lewis, CEO of HomeTown Health, an association of rural hospitals in the state.
“We have an excellent tax credit program, and hospitals are very excited about it,’’ said Jimmy Lewis, CEO of HomeTown Health, an association of rural hospitals in the state. “We have transparency problems. The Legislature will have to make changes on the reporting and accountability.”
The Department of Revenue told GHN that the names of donors — individual or business — and the amounts they gave is confidential information.
No single hospital can receive more than $4 million in donations each year.
“Although I am not holding my breath, we did have over $1 million in potential donations get declined that I would love to get a second chance at collecting,” said Daniel Graves, who chairs the board at Elbert Memorial Hospital in northeast Georgia, which raised $1 million through the program, the Valdosta Daily Times reported.
“I’m confident that our donors will follow through if given the chance, and I’ll take as many bites at the apple as the state will give the taxpayers,” Graves said.
The gubernatorial candidates differ on the tax credit program.
Secretary of State Brian Kemp, a Republican, wants to expand the program and devote more state dollars to it. Democrat Stacey Abrams, a former House minority leader, supports Medicaid expansion instead, saying she believes it would give more meaningful aid to rural hospitals, the Daily Times reported.