OPED: WellSpan needs to pay its fair share

Bill Swartz
York City
WellSpan Hospital. Bill Kalina/photo

For our community to thrive, we need strong, authentic partnerships. There have been many examples of great partnerships throughout the years. Unfortunately, WellSpan’s partnership with the York community is not one of them.  

It might be good, but it’s not great.  And with the conditions we face today, we need that relationship with WellSpan to be truly extraordinary. The good news is that this is entirely possible.  

In my view (and in the view of many political, business and community leaders), WellSpan is unfortunately not shouldering its fair share of the burden. This leaves that share to be borne by others (including small business owners and elderly residents living on a fixed income).   

We county residents don’t have the cash and political influence to declare ourselves a “charity.” So we pay our fair share. It doesn’t seem right that WellSpan should be able to avoid paying its fair share, especially when it passes its obligation onto others who can barely afford it.  

I honestly don’t think WellSpan leaders fully understand the negative impact of their current approach to the community. I believe we citizens should help WellSpan realize that the organization is falling short. If we do that, the leadership of WellSpan is likely to make a positive change and follow the lead of Lancaster General.    

All those symbolic gestures and payments in lieu etc. that WellSpan provides are all wonderful and represent a great deal of money and assistance. But when they are added up, Lancaster General, for example, does vastly more for the city of Lancaster than WellSpan does for the city of York. That really needs to change.  

There is so much potential here for a powerful positive relationship between WellSpan and the York community. But for that positive relationship to truly develop, WellSpan will need to start looking across the river to see how a strong community yields a strong company. That “strong community” aspect can’t happen if WellSpan continues to do less than it should.   

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It would be wonderful if WellSpan would engage more with citizens around the county as it goes through its regular periodic process to maintain its nonprofit status. Perhaps taxpayers and community leaders could play a larger part in the process and it could be more open to the public. This is something that could be very healthy and positive for all involved.  

Nonprofit status allows WellSpan to pay a much lower amount in taxes. That may seem great in the board room in the short term. But when you look long term at the condition of the community, this is not so great for York or the WellSpan organization. To have a strong company, you really need a strong community.   

There’s a long-term perspective that has a direct impact on future success of the organization — something the CFO might not take into consideration. The board members though (many of whom live in York) would be much more likely to consider the bigger picture and how the long-term health of WellSpan is directly tied to the long-term health of the community.

In Pennsylvania we employ a five-prong evaluation, known as the HUP Test, to determine if an entity qualifies for tax-exempt status:

1.  It advances a charitable purpose;

2. It donates or renders gratuitously a substantial portion of its services;

3. It benefits a substantial and indefinite class of persons who are legitimate objects of charity;

4. It relieves the government of some of its burden; and

5. It operates free from private profit motive.

Prongs 2 and 5 obviously prove problematic for WellSpan (and, indeed, most large-scale health systems). Prong 2, that the entity “... render gratuitously a substantial portion of its services,” is another that causes great concern.  Does anyone believe that WellSpan is providing services to a huge percentage of patients (40 percent? 50 percent) completely for free in order to fulfill its charitable requirement?

Ask 10 of your friends who have used the services of WellSpan (or any other gargantuan health care juggernaut), and see how many of them were provided those services for free. If the answer for most of us is “not many” or “none,” the “gratuitous” prong is not being met, certainly not in any substantial way.

Prong 5 — that the entity does not take into consideration profit-taking when it provides services — seems like it would be a pretty tough hurdle for WellSpan to cross at evaluation time. 

We all know WellSpan is consuming a serious amount of municipal services. No doubt about it. And if they are not paying their fair share through taxes for these necessary services, then someone else is.

Guess who that is?

It’s the normal York County workers (with a median annual income of $28,454) who are picking up the tab for an organization that can afford to pay its management team a median annual income of $237,162, with the CEO pulling in at least $1.6 million dollars each year.