CHICAGO – Minnesota hospitals provided $509 million in uncompensated care in 2011, up from $496 million a year earlier, according to the Minnesota Hospital Association’s annual community benefits report.

“As nonprofits, hospitals and health systems provide access to care to patients — regardless of their ability to pay — 24 hours a day, seven days a week,” the association’s president, Lawrence Massa, said in a statement. “That’s why Minnesota hospitals support the expansion of Medicaid to provide insurance coverage to more Minnesotans and the creation of a Minnesota-based insurance exchange to insure more Minnesotans.”

Uncompensated care in the report covers both charity care that was provided with no expectation of repayments, and bad debt. The figure reported by the association has risen by 10% over the last five years.

The review also put the difference between the cost of providing service to Medicaid and Medicare recipients and the amount reimbursed at about $1.5 billion. Hospitals nationwide have pressed to include those figures in any assessment that looks at whether they warrant their tax-exempt status.

Not-for-profits have faced more local, state, and federal pressure to justify tax-exempt perks that include property and sales tax exemptions and access to the tax-exempt bond market.

The difference between Medicaid services and reimbursements rose by 26% between 2010 and 2011, according to the report that reviewed 2011 figures provided by its member hospitals.

“In all, such government underfunding accounts for more than 7% of Minnesota hospitals’ total operating expenses,” the report said.

Overall, hospitals in the state provided community programs and services valued at $3.6 billion in 2011, up 7% from a year earlier. That figure includes uncompensated care and the Medicaid/Medicare differential. It also includes $515 million for research on better medical treatments and possible cures of disease, $297 million on education and workforce development, and $355 million for community clinics and healthcare events.

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