Cleveland Clinic Once Again Among Worst Hospitals in "Fair Share Deficit" Rankings, Comparing Charity to Tax Breaks

The Clinic in 2023 Credit: Warren LeMay/FlickrCC

The Cleveland Clinic, ranked annually as one of the best hospitals in the country and world for care, once again nabbed the ignoble designation as one of the worst hospital systems in the country when it comes to social responsibility.

Released this week, the “Fair Share Deficit” rankings from the Lown Institute, a Massachusetts-based nonprofit, placed the Clinic in the bottom ten for hospitals when comparing charity care and community spending compared to tax breaks.

Carrying a net $212 million deficit, the Clinic ranked fourth worst, with a net income of $1.1 billion and just 2.64% of its spending going toward community.

“When tax-exempt hospitals started they were small, clearly charitable, faith-based or community organization-based and clearly charitable,” Lown Insitute CEO and President Dr. Vikas Saini told Ideastream. “Health care has become a massive, massive, big business and the business imperatives are really driving a lot of it.”

Key takeaways from this year’s report include findings that 80% of 2,425 nonprofit hospitals spent less on “financial assistance and community investment than the estimated value of their tax breaks” contributing to a $25.7 billion deficit across the nation in 2021.

UH and Akron General each also show a fair share deficit, $61 million and $29 million respectively.

The Clinic and others have disputed the process of compiling the rankings,.

“Cleveland Clinic remains committed to the communities we serve,” a hospital spokesperson said in a statment. “The methodology used for this report does not fully align with how the IRS Form 990 categorizes community benefit. The excluded categories of research, education, and Medicaid shortfall all have a direct impact on the health of the community. ”

Policy recommendations from the institute to address the issue in the future include requiring hospitals to report spending on community benefit programs as identified in community health needs assessments, creating a minimum spending benefit in proportion to hospitals’ revenue, and mandating more transparency in tax filings with regards to charity care.

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