Dr. Marc Gorelick, president and CEO, progressive pediatrics blog

Community Benefit is crucial to our mission. Here’s what it is and why we take it so seriously.

At Children’s Minnesota, our mission is the same today as it was when our first hospital opened 100 years ago: We champion the health needs of children and families.

It’s a broad mission – but that’s by design. Not only do we want kids to be healthy, we also want their communities to be healthy. Healthier communities produce healthier kids.

What is Community Benefit?

What allows us to focus so much on the health of our community is our status as a nonprofit. Being a nonprofit, or charitable organization, means we don’t exist to earn a profit for the financial benefit of investors. We exist to carry out our mission. Excess earnings we may have don’t go to shareholders. Instead, we use these funds to help our community thrive. A portion of the funds go specifically to something called Community Benefit.

How, and how much, do we invest?

Nonprofit health systems need to be transparent and accountable when it comes to how, and how much, they invest in Community Benefit. We do that every year in our annual report.

In the graphic below you’ll see our Community Benefit funds go to:

Unreimbursed costs of serving Medicaid patients. This is where most of our Community Benefit funds go and here’s why. In Minnesota, we are fortunate that nearly all children in need can be covered by government insurance called Medicaid. But Medicaid doesn’t cover the full cost of a child’s care; on average it only covers about 70%. That means Children’s Minnesota must cover the remaining 30%. Community Benefit funds help us make up the difference, so we never have to turn a child away.

A large portion (nearly half) of our patients are on Medicaid, so that’s why, in the graphic below, the largest portion of Community Benefit funds went to covering the cost of care that Medicaid doesn’t reimburse.

Community Benefit Graphic
Click to enlarge.

Subsidized health programs. These are clinical programs children need, but the programs aren’t self-supporting, so Community Benefit funds keep these services available and accessible. They’re programs like neurosurgery, neurology and diabetes clinics, home health care, inpatient and outpatient mental health services, and infection control.

Community health improvement services. These are vital health services beyond medical care like social work, trauma injury prevention and family support services that help build stronger families and communities.

Health professions education. These funds are invested in the education of current and future doctors, nurses and other health care professionals to ensure we have enough kid experts to care for kids in our community.

Research. These funds support the development of new treatments that are improving the lives of children in Minnesota and around the world. Recent examples: a study of Somali women’s beliefs and concerns regarding fetal interventions and a study to determine the feasibility of using technology-based programs to efficiently perform comprehensive hearing tests in elementary schools.

Charitable patient care. This is free care for patients who can’t afford care and aren’t covered by Medicaid. You may be wondering why this number is low compared to the other Community Benefit investments we make. It’s not because we don’t provide charitable patient care. Keep reading to learn more.

Why “Charitable” funding looks low

In the graphic above, you’ll see that Community Benefit funds covered about $1 million for “Charitable Patient Care,” sometimes called charity care. That comparatively “low” number is a good thing.

Fortunately in Minnesota, not many kids need charitable patient care because, as I mentioned earlier, most kids qualify for Medicaid coverage. And again, because about half of our patients have Medicaid, and Medicaid only covers part of a child’s medical care, much of our Community Benefit funding goes to making up that difference. Technically that doesn’t fall under the definition of “Charitable Patient Care,” even though that’s what it is – covering the cost of care for families who aren’t able to afford it.

Listening to our community

As a nonprofit, we’re also responsible for listening to and acting upon the concerns of our community, including partner organizations, families and staff. We publish our findings every three years in a Community Health Needs Assessment (CHNA) and follow up with a specific plan for addressing the needs identified. The CHNA report informs our strategic approach to investing in programs and services that align with our community’s priorities.

For example, our 2022 CHNA revealed safety to be a top priority for our community, so we devoted some Community Benefit funds to co-sponsoring a gun buyback event and a partnership with Next Step, a hospital-based violence intervention program that connects survivors of violent injury to resources and support.

We also recently launched a Community Advisory Council made up of local leaders that will provide ongoing strategic guidance to the organization, including helping guide our next CHNA process.

More than checking a box

Our status as a nonprofit, tax-exempt hospital mandates Community Benefit and Community Health Needs Assessments, but we want our community to know we take these requirements seriously. We listen to and work closely with our community. We invest Community Benefit funds wisely. For us, this isn’t just checking our box. It’s fulfilling our mission.

Marc Gorelick, president and CEO

Marc Gorelick, MD
President, chief executive officer

Marc Gorelick, MD, is the president and chief executive officer (CEO) at Children's Minnesota. He is deeply committed to advocacy issues that impact children's health, sustainability and advancing diversity, equity and inclusion.

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Julianna Olsen