Standardized coding of patient complaint data may provide an opportunity for quality improvement, patient satisfaction and changes in patient care.

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The managed care industry is at a crossroads. Belief in the ability of market forces alone to create an environment fostering quality health care at lower cost is eroding. Regulators across the country are confronted with a growing consumer backlash against managed care. As a result, states have passed managed care reform legislation at unprecedented rates. In doing so, states are confronted with a patchwork of federal intervention and preemption. We examine the stages of these recent state and federal developments and evaluate them in terms of the traditional objectives of a reasonably functioning health care system: quality care, access, and cost containment.

Hospitals long ago shed their role as alms houses for the poor. What vestiges remain of the early American hospital are the tax-exempt, nonprofit hospital form and a general perception that hospitals, as charitable institutions, owe a duty to their communities. The appropriateness of the nonprofit hospital tax exemption has long been debated, and many theories have been advanced to justify the tax exemption of nonprofit hospitals. In a growing number of jurisdictions, however, state and local authorities have gone beyond the theoretical debate and are challenging the tax exemption of their nonprofit hospitals. For various reasons, efforts are afoot to capture greater community benefit from nonprofit hospitals.At the heart of such challenges is the debate over the nature and extent of the duty charitable institutions owe to their communities. A demand is growing for nonprofit hospitals to earn their tax exemptions by benefiting their communities in concrete ways. Some have been stripped of their tax-exempt status by local authorities or pressured to make payments in lieu of taxes. A number of states have recently implemented initiatives in an attempt to make hospitals more accountable for their community benefits. Many hospitals are responding to this heightened scrutiny in a proactive way, by voluntarily documenting community benefits. A number of nonprofit hospitals and hospital associations are cooperating with—or even sponsoring—state legislation in this area.

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