IRS Form 990 Schedule H
also known as: Schedule H · 990 Schedule H · Community Benefit Report
The annual community benefit report nonprofit hospitals must file with the IRS to justify their tax-exempt status.
Schedule H of IRS Form 990 is where every nonprofit hospital quantifies its "community benefit" — the justification for the federal income tax exemption nonprofit hospitals receive (worth roughly $30B/yr in foregone federal revenue per CBO estimates).
Part I of Schedule H reports four key cost categories:
- Financial assistance at cost (charity care) — care provided to patients who couldn't pay
- Unreimbursed Medicaid — the gap between Medicaid payments and the cost of care for Medicaid patients
- Community health improvement services — programs like screenings, vaccinations, and health education
- Subsidized health services — services hospitals run at a loss because no other community provider does (e.g. rural emergency rooms)
The IRS does not enforce a minimum community benefit threshold — hospitals self-determine what's "sufficient" — which has made Schedule H a perennial source of policy controversy. Comparative Schedule H analysis is one of the most common ways journalists, regulators, and academics scrutinize the nonprofit hospital sector.
EXAMPLE
If a hospital reports $40M in charity care and $25M in unreimbursed Medicaid on Schedule H, that $65M is its claimed direct community benefit at cost.