Nonprofit Hospitals Expand to Affluent Suburbs

Nonprofit hospital systems across the country are increasingly closing inner-city facilities that serve the poor, while spending billions of dollars to expand into the suburbs, where more patients have health insurance, reports The Wall Street Journal.

Shutting unprofitable operations and expanding the profitable ones is common in business, but nonprofit hospitals, which see billions of dollars in annual tax exemptions, are charged with providing charity care, the newspaper notes. It also notes that the expansions to the suburbs come as many nonprofit chains are doing well financially.

To examine the trend, the newspaper focuses on Ascension Health, in Detroit, the country’s largest nonprofit system. Ascension says it is unable to allow its more profitable subsidiaries to subsidize those that are struggling. “Such an approach would mean that needs in other communities may not be met,” a hospital spokeswoman told the newspaper.