In exchange for bloated health insurance payments, members of the Lancaster public fortunate to have full insurance coverage are obtaining excellent medical care. Furthermore, out of its average annual earnings of $100 million, non-profit “Public Charity” Lancaster General Health provides the public with an average of $4 million in grants each year.
Let’s examine the scenario of selling LGH to private enterprise, as the former county commissioners sold Conestoga View Nursing Home to a for profit organization that had been managing it for years.
Of course Conestoga view was either losing money, breaking even, or earning a trifle – depending on which analysis you read. But we know that LGH is enjoying extraordinarily high profits due to its required annual federal ‘990 Report’, earnings that are among the highest in the state. It is reasonable to surmise that LGH would bring on the market at least ten times its annual $100 million in earnings — that’s a billion dollars.
Let’s count the advantages:
1) The new owners would pay say $30 million a year in income taxes, after benefiting from some tax shelter. That beats the current annual average of $3 million in voluntary grants.
2) The real estate would now go on the tax rolls. Since the real estate would be assessed much more in accordance with the sales price, the amount collected by city, school board and county would far exceed the amount LGH currently contributed in lieu of taxes. The taxes might amount to $10 million.
3) The public could invest the billlion dollars it receives from the sale in bonds and conservative mutual funds and obtain say $25 million in additional largesse each year.
4) Cost for services would be likely to remain the same, since LGH is already charging all the market can bear.
5) Thus total annual benefit to the tax payers would be an additional $27 million in taxes over the current grants, perhaps another $8 million in real estate taxes above the current contributions, and $25 million in dividends and interests for a grand total of $60 million dollars, and that is above the average$3 million in grants. Even half that amount in public benefits, say $30 million, would make a huge difference in both tax payer relief and local services.
The purpose of this exercise is to emphasize that we are paying a huge amount to LGH for health care, it is enjoying extraordinary profits in addition to extravagant pay for top executives and possible perks about which we known not, that the public’s money is spent without transparency, and everything is determined behind closed doors by a self perpetuating board of directors.
Just about everyone, including government officials and the newspapers, is scared to speak out on the subject, although people grumble off the record. But if it becomes a topic of discussion among friends and neighbors, it will over time become a matter of public discourse and this, in time, will lead to much needed reform.
LHG is ours. Let’s take it back!
