# Who owns Austin’s hospitals—and what does nonprofit status get them?

**Research completed October 30, 2026. Geography: Travis, Williamson, Hays, Bastrop and Caldwell counties.**

Austin’s hospitals produce substantial, measurable charitable benefits. The public records also show that “nonprofit versus for-profit” is too crude a way to decide whether the tax bargain is worthwhile. Ownership, operating control, property interests, public payments and the right to receive profits often belong to different organizations.

The strongest new finding is in the accounting. Ascension Seton reported a 12.3% increase in total community benefit between fiscal 2024 and 2025. Subtract every reported offsetting revenue amount from the same reported costs, however, and the total falls 11.2%. Both statements are arithmetically correct. IRS reporting rules require a category with revenue exceeding cost to contribute zero, rather than a negative number, to community benefit. In fiscal 2025, that treatment kept a $61.7 million excess of reported Medicaid offsets over reported Medicaid costs from reducing the total.

That finding is not an allegation of misreporting or declining patient assistance: Seton’s reported net financial assistance rose sharply. It shows why the amount called “community benefit” cannot automatically be read as the organization’s aggregate unreimbursed contribution.

I built an ownership roster, matched it to Medicare financial reports, reconstructed the community-benefit accounts, and checked the available property-tax estimates against appraisal records. The result is an evidence base for a more precise question: **Which entity received which privilege, who had already paid for the care, and what additional benefit remained for patients and the community?**

## What earlier work already establishes

The basic ownership story is public. St. David’s is a partnership between HCA and two charitable foundations; Seton belongs to Catholic nonprofit Ascension; Baylor Scott & White is a nonprofit system. Central Health is Travis County’s public hospital district. Official descriptions and reporting on the Central Health–Ascension disputes explain those relationships, but they do not provide one consistent campus-to-company-to-taxpayer crosswalk. [St. David’s official description](https://www.stdavids.com/about-us) · [Central Health audit](https://www.centralhealth.net/wp-content/uploads/2026/03/Travis-County-Healthcare-District-Financial-Statements_9-30-2025.pdf)

The broader intellectual debate is established too. Gary Young’s 2004 research questioned whether nonprofit joint-venture regulation focused too heavily on governance form and too little on community service. Later research compared nonprofit benefit spending with a for-profit baseline. The distinction between legal structure and actual additional benefit is therefore a starting point, not a new discovery. [Young](https://pubmed.ncbi.nlm.nih.gov/15281481/) · [Zare, Eisenberg and Anderson](https://doi.org/10.1111/1475-6773.13668)

Lown’s 2025 fair-share work supplies the most useful existing tax comparison, using 2020–2022 averages. It estimates whether selected community investments exceed tax benefits. Its Texas report assigns Dell Children’s a $46 million annual fair-share deficit and the statewide Baylor Scott & White system a $235 million deficit. The latter is not an Austin figure. Dell Children’s figure is marked as involving prorated group-return information; it is not a directly observed campus ledger or a present-day tax bill. [Texas report](https://lownhospitalsindex.org/wp-content/uploads/2025/04/Texas_state-report.pdf) · [Methodology](https://lownhospitalsindex.org/wp-content/uploads/2025/04/fair-share-2025-appendix-20250409.pdf)

An easy statewide misreading also deserves correction. Lown reports approximately $2.1 billion in annual Texas tax benefits and $2.4 billion in community investment. Its $643 million “deficit” adds the deficits of hospitals below the threshold; it does not subtract total statewide investment from total statewide tax benefits. Surpluses elsewhere are not netted against that headline.

The contribution here is the reconciliation those accounts require: current legal operators, dated ownership changes, shared reporting identifiers, proportional foundation interests, reimbursement offsets and actual parcel evidence.

The useful extension of the [toll-road ownership frame](https://sulayman-bowles.dev/markets/who-owns-texas-toll-roads) is to follow claims on assets, profits, control and access separately. A public contract can impose a commitment to provide care even when the public owns neither the operating company nor the hospital building.

## 1. The ownership map

The October 21, 2026 state directories contain 47 private hospital license-location records in the five counties. Adding Austin State Hospital produces **48 roster/state records**. The private records represent 40 distinct licenses and 37 nonblank Medicare certification numbers, or CCNs. Ascension Seton Bastrop is an additional operating department of Seton Hays. These counts deliberately distinguish care locations from independent businesses and financial reporting units. [HHSC general/special directory](https://www.hhs.texas.gov/sites/default/files/documents/general-special-hospital-list.xlsx) · [HHSC psychiatric directory](https://www.hhs.texas.gov/sites/default/files/documents/doing-business-with-hhs/provider-portal/facilities-regulation/hospitals/hospital-psych-directory.xlsx) · [CMS enrollments](https://data.cms.gov/sites/default/files/2026-10/961708ac-2136-43cb-9587-ac64af23b6ab/Hospital_Enrollments_2026.09.29.csv)

The complete appendix and workbook identify every row’s county, address, license, CCN, legal operator, parent, partners, dates and unresolved questions. The map below groups those records without hiding the smaller hospitals.

| Operating group or arrangement | Hospitals and licensed locations in scope | Ownership and operating relationship |
|---|---|---|
| Ascension Seton core | Seton Medical Center Austin, Northwest, Southwest, Hays, Williamson, Edgar B. Davis, Smithville; Dell Seton; Dell Children’s main and North campuses | Catholic nonprofit system. The ten roster locations share the Ascension Seton operating organization. Bastrop is an additional Hays department. |
| Ascension Seton Cedar Park | Cedar Park | Nonprofit parent acquired the remaining interest in June 2025; Cedar Park Health System LLC remains classified proprietary in CMS. |
| St. David’s HealthCare | Medical Center, North Austin, South Austin, Round Rock, Georgetown, Heart Hospital of Austin, Rehabilitation Hospital, Surgical Hospital | St. David’s Healthcare Partnership LP LLP; HCA is the hospital operating partner, alongside St. David’s Foundation and Georgetown Health Foundation. Eight roster rows, four CCNs. |
| Baylor Scott & White acute hospitals | Austin, Buda, Pflugerville, Round Rock, Lakeway, Taylor, Emergency Medical Center–Cedar Park | Nonprofit entities. Round Rock, Lakeway and Cedar Park share a license and CCN; Austin, Buda and Pflugerville share a legal organization but have separate CCNs. |
| BSW / Select rehabilitation venture | BSW Institute for Rehabilitation–Lakeway | Separate proprietary venture: reported 51% Baylor University Medical Center and 49% Select interests, with Select operational control. |
| Other nonprofit systems | CHRISTUS Santa Rosa–San Marcos; Texas Children’s Hospital North Austin | CHRISTUS is a Catholic nonprofit system; Texas Children’s is a nonprofit organization. |
| Lifepoint / Ascension | Central Texas Rehabilitation Hospital | Proprietary venture; reported 80% Lifepoint chain / 20% Ascension interest. |
| Acadia / Ascension | Cross Creek Hospital | Proprietary venture; reported 88.2% Acadia / 11.8% Ascension interests effective August 2025. |
| PAM / Ascension | PAM Rehabilitation Hospital of Round Rock; PAM Health Rehabilitation Hospital of Kyle | Proprietary ventures; reported 25% Ascension interest in each. |
| Ascension / SCA / physicians | Northwest Hills Surgical Hospital | Proprietary venture. Seton’s FY2025 filing reports a 51% stake; dated upstream records do not support a clean current remainder calculation. |
| Encompass Health | Rehabilitation Hospital of Austin; Rehabilitation Hospital of Round Rock | For-profit Encompass operating group. |
| Universal Health Services | Austin Oaks; Texas NeuroRehab medical and psychiatric facilities | For-profit UHS group; the two NeuroRehab licenses/buildings occupy one campus. |
| Other specialty chains | Cornerstone Specialty Hospitals Round Rock; PAM Specialty Hospital of Luling; Georgetown Behavioral Health Institute; Rock Springs | Respectively Scion/Cornerstone, PAM, Signature Healthcare Services, and Lifepoint/Springstone. Exact upstream private interests are not all publicly resolved. |
| Family Hospital Systems | Brushy Creek Family Hospital; Lake Travis ER & Hospital | Hospital-licensed facilities in the Family Hospital Systems group; complete private cap tables unverified. |
| Other independent / physician arrangements | Kyle ER & Hospital; Hospital at Westlake Medical Center | Kyle’s ultimate ownership remains unresolved. Westlake’s CMS chain includes Attila entities, physician interests and family trusts. |
| State of Texas | Austin State Hospital | Public psychiatric hospital operated through Texas HHSC. |

Sources for the ownership relationships are the [CMS all-owners file](https://data.cms.gov/sites/default/files/2026-10/2517a8c1-44a2-4620-8d65-c72bfae27c3c/Hospital_All_Owners_2026.09.29.csv), partner filings and current primary announcements linked beside each workbook row. Select’s upstream ownership changed in July 2026, when a WCAS-led consortium acquired control. That transaction concerns the Select side of the Lakeway rehabilitation venture; it does not transfer Baylor’s reported 51% interest. [WCAS announcement](https://www.wcas.com/news/select-medical-acquired-by-wcas-led-consortium)

This map produces two immediate corrections to the usual shorthand.

**A nonprofit system can own proprietary hospitals.** Ascension has documented interests in at least six such local operators: Cedar Park, Central Texas Rehabilitation, Cross Creek, Northwest Hills Surgical, PAM Kyle and PAM Round Rock. Their individual tax treatment cannot be inferred from the parent’s religious or nonprofit identity.

**The state’s profit flag is not a tax determination.** HHSC labels four St. David’s locations sharing license 000035 as nonprofit, while CMS labels the operating entity proprietary. Central Health’s official disclosure identifies Columbia/St. David’s Healthcare as its fourth-largest taxpayer, with $743.1 million of taxable property value in tax year 2023. That is strong evidence of a taxable property base, though it is neither taxes paid nor a complete inventory of every related parcel. [Central Health operating disclosure, PDF p4](https://www.centralhealth.net/wp-content/uploads/2024/04/1-TCHD-FY-2023-Annual-Financial-Operating-Data.pdf)

Property title adds another layer. At Dell Seton, UT owns the land, Central Health holds the ground lease and subleases to Seton, and Seton owns and operates the hospital. Heart Hospital’s appraisal records separately identify state-owned land and partnership-owned improvements. A hospital name cannot identify all of those claims. [Central Health audit](https://www.centralhealth.net/wp-content/uploads/2026/03/Travis-County-Healthcare-District-Financial-Statements_9-30-2025.pdf) · [TCAD search](https://traviscad.org/propertysearch)

## 2. St. David’s makes the binary especially misleading

St. David’s Foundation reports a **40.59%** interest in the hospital partnership in its 2024 return. Georgetown Health Foundation reports **1%**. HCA’s subsidiary exhibit identifies the partnership but does not disclose HCA’s current percentage. I have not converted the arithmetic remainder into a verified ownership claim. [Foundation filing, Schedule R](https://stdavidsfoundation.org/wp-content/uploads/2025/11/St.-Davids-Foundation-2024-Form-990PD.pdf) · [Georgetown Schedule R](https://projects.propublica.org/nonprofits/full_text/202513219349313406/IRS990ScheduleR) · [HCA subsidiary exhibit](https://www.sec.gov/Archives/edgar/data/860730/000119312526044769/hca-ex21.htm)

A partnership generally passes federal income through to its partners. The foundation reports its related hospital income as exempt program revenue; the corporate side is a taxable partner. The arrangement therefore combines different tax treatments within one hospital business. It is not an exemption for the partnership’s entire income simply because a charitable partner participates. [IRS partnership explanation](https://www.irs.gov/businesses/partnerships)

The foundation’s 2024 return reports $164.3 million in cash-or-property transfers from the partnership, $86.5 million in grant expense, and $1.93 billion in year-end net assets. These are three different accounting measures, not a cash waterfall. Its largest reported organizational grants went to Foundation Communities ($5.84 million), Lone Star Circle of Care ($3.87 million) and People’s Community Clinic ($3.72 million), all described as health-access grants. The mechanism delivers benefits outside the hospital walls as well as inside them. [Foundation return, Schedules I and R](https://stdavidsfoundation.org/wp-content/uploads/2025/11/St.-Davids-Foundation-2024-Form-990PD.pdf)

The second charitable partner provides an unusually useful audit check. Scaling Georgetown’s 1% hospital figures by 40.59 reproduces most of St. David’s Foundation’s corresponding hospital categories within rounding. The remaining financial-assistance amount closely matches the foundation’s dental program. This confirms that the foundation’s Schedule H combines proportional hospital activity with its own programs.

That makes a common-looking addition invalid: the foundation’s $173.1 million Schedule H total already includes a contribution category dominated by its own grants. Adding another $86.5 million of grant expense would count most of those grants twice. The workbook preserves the original categories and the cross-owner reconstruction rather than treating a foundation return as a whole-system hospital return.

This structure has been contested before. The Fifth Circuit sent the tax-exemption case back for further proceedings in 2003; a jury subsequently found St. David’s entitled to exemption, as the Joint Committee on Taxation recorded in 2005. The earlier appellate decision alone is not the final disposition. [JCT, printed p120, footnote 403](https://www.jct.gov/getattachment/91d1c71d-866b-4423-84a7-0f1ec352edf8/x-29-05-1586.pdf)

## 3. What the nonprofit privilege buys—and what it requires

The potential financial benefits include exemption from federal income tax on related activities, qualifying state and local tax exemptions, access to tax-exempt borrowing, and deductible charitable contributions. Each has a different beneficiary and counterfactual. An income-tax estimate needs taxable profit after applicable deductions and losses; a property estimate needs the actual ownership interest, exemption and tax rate; a financing estimate needs the interest advantage, not the face value of the bond. [KFF methods](https://www.kff.org/health-costs/the-estimated-value-of-tax-exemption-for-nonprofit-hospitals-was-about-28-billion-in-2020/) · [Texas exemption guidance](https://comptroller.texas.gov/taxes/publications/96-1045.php)

Nonprofit status also imposes real obligations. Federal hospital rules require a community health needs assessment, a financial-assistance policy, limits on charges to eligible patients, and specified safeguards before extraordinary collection actions. They do not impose a universal numerical charity-care quota or guarantee low commercial prices. [IRS section 501(r)](https://www.irs.gov/charities-non-profits/charitable-organizations/requirements-for-501c3-hospitals-under-the-affordable-care-act-section-501r) · [IRS community-benefit standard](https://www.irs.gov/charities-non-profits/charitable-hospitals-general-requirements-for-tax-exemption-under-section-501c3)

Texas’s requirements are more specific than a simple “five percent charity” claim suggests. Chapter 311 offers alternative standards, including a reasonable level relative to need and resources, charity plus government-sponsored indigent care equal to specified tax benefits excluding federal income tax, or total community benefit of at least 5% of net patient revenue with at least 4% in charity and government-sponsored indigent care. Recent disproportionate-share designation can deem a hospital compliant, and systems may report on a consolidated basis. [Texas Health and Safety Code §311.045](https://tcss.legis.texas.gov/resources/HS/htm/HS.311.htm)

Legal compliance, Lown’s fair-share threshold and an economic test of additional public value are therefore three different judgments. A hospital could pass one and fail another without a contradiction.

## 4. A local test: charity costs and margins

To test whether nonprofit ownership corresponds to more charity care locally, I joined the roster to CMS cost reports, resolved shared CCNs and Smithville’s identifier change, and selected full reporting years ending in 2024. The three core groups contain 18 distinct reports. Bastrop’s historical report spans 15 months and is excluded; the closed Shoal Creek hospital is outside the current-facility roster. These are fiscal years with different end dates, not a common calendar-year set.

| Core reporting group | Reports | Reported charity-care cost | Charity cost / operating expense | Patient-service margin |
|---|---:|---:|---:|---:|
| St. David’s | 4 | $144.0m | **7.49%** | **26.05%** |
| Ascension Seton | 9 | $217.4m | **7.75%** | **8.10%** |
| Baylor Scott & White acute hospitals | 5 | $31.6m | **2.99%** | **−7.29%** |

Calculations use the [October 2026 CMS extracts](https://data.cms.gov/provider-compliance/cost-reports/hospital-provider-cost-report). Charity is the reported cost-report charity measure. Margin is patient-service income divided by net patient revenue, not corporate net profit or EBITDA. The workbook contains every numerator, denominator, reporting date and identifier.

The initial result challenges a simple ownership story: St. David’s and Seton have similar aggregate charity-cost shares, while St. David’s reported patient-service margin is much higher.

But the opposite interpretation deserves a serious test. Removing Dell Children’s from Seton raises its charity-cost share to **10.31%**. Dell Seton alone reports **$90.5 million**, about **42%** of the core Seton group’s charity cost, on about **19%** of its operating expenses. What services a system provides and where its safety-net obligations sit materially affect the comparison.

Baylor’s aggregate also conceals variation: Buda and Pflugerville report charity-cost shares above 10%, while the much larger Round Rock reporting entity is about 2.1%. Taylor’s cost report contains substantial activity relative to its small inpatient footprint; excluding that critical-access reporting entity improves BSW’s aggregate patient-service margin to about −1.52%, though it remains negative. Hospital beds alone do not describe the scope of these financial reports.

CHRISTUS Santa Rosa–San Marcos provides another nonprofit observation outside those three core groups: its full-year report ending June 2024 shows $12.0 million in charity cost, a 10.19% charity-cost share and a 3.63% patient-service margin. Texas Children’s North Austin has no qualifying full-year observation in this comparison and is left unscored. Neither campus is assigned a new local tax-versus-benefit balance; a broader parent organization’s figures cannot simply be allocated to an Austin-area campus without evidence.

These observations do not estimate the causal effect of nonprofit status. They are not adjusted for patient mix, teaching, outpatient operations, transfers or public contracts. St. David’s hybrid is also an imperfect fully taxable control group. And HCRIS charity cost is not interchangeable with Schedule H net financial assistance after its reported offsets. The justified conclusion is that a brand’s tax label cannot substitute for measuring the actual reporting entities.

## 5. The accounting rule that changes the story

Seton’s own two consecutive returns permit a cleaner within-entity reconciliation.

| Ascension Seton, EIN 74-1109643 | FY ended June 2024 | FY ended June 2025 |
|---|---:|---:|
| Net financial assistance | $128.8m | $217.3m |
| Medicaid cost | $635.6m | $597.9m |
| Medicaid offsetting revenue | $559.2m | $659.7m |
| Reported Medicaid community benefit | $76.4m | $0 |
| Reported total community benefit | **$262.1m** | **$294.5m** |
| Total reported costs minus all offsets | **$262.1m** | **$232.7m** |

Sources: [FY2024 Schedule H](https://projects.propublica.org/nonprofits/full_text/202521359349309302/IRS990ScheduleH) and [FY2025 Schedule H](https://projects.propublica.org/nonprofits/full_text/202641329349307619/IRS990ScheduleH). These are filer-level accounts including operations outside the five-county roster and proportional ventures; they are not the local HCRIS totals above.

The IRS expressly prohibits negative net-benefit entries in these categories. In fiscal 2025, Reported Medicaid offsetting revenue exceeded reported costs by $61.743 million. The form records zero Medicaid benefit, and that surplus does not reduce the other positive categories. Consequently reported community benefit rises **12.35%**, while signed costs minus offsetting revenue fall **11.21%**. [2024 IRS instructions, p3](https://www.irs.gov/pub/irs-prior/i990sh--2024.pdf)

St. David’s Foundation shows the same mechanism in calendar 2024: its reported net total is **$173.056 million**; gross costs minus all offsets are **$108.097 million**. The **$64.959 million** difference equals its Medicaid and research surpluses, both floored at zero. This is correct reporting under the mandated rule.

There are defensible reasons to retain a category-based benefit measure. A surplus in one program does not mean the hospital stopped providing financial assistance in another. Seton’s net financial assistance increased **68.7%**. Supplemental-payment settlement timing may also move revenue across years. The signed calculation is useful for examining the financing burden; it is not proof that care deteriorated, that ordinary Medicaid rates are adequate, or that a hospital owes tax.

Baylor’s published total needs a different bridge. Its five relevant FY2025 community-benefit reports sum to **$113.94 million**. Of that, **$62.95 million** is government-sponsored program services, a category including Medicare shortfalls. Another **$41.58 million** combines charity with government-sponsored indigent care. Neither amount can simply be called free care. Lown excludes the Medicare category from its community-investment measure. The dispute is partly about what society wants to purchase with an exemption, not just whether the totals add up. [BSW reports and definitions](https://www.bswhealth.com/about/community-impact/community-benefit-reports)

## 6. What Travis County’s hospital district money buys

Central Health operates as a public purchaser and provider within a larger network; it does not own or control every hospital it helps finance. Its FY2025 audit records these distinct amounts:

| Flow | FY2025 amount | Meaning |
|---|---:|---|
| Property-tax revenue | $344.5m | District revenue, not a payment wholly destined for Seton |
| Health-care delivery expense | $268.0m | Delivery spending across the district’s arrangements and providers |
| UT affiliation payment | $35.0m | Payment to UT, distinct from a payment to Ascension |
| Hospital assessments collected through the LPPF | $335.1m | Hospital-funded local matching mechanism, distinct from property taxes |
| LPPF intergovernmental transfers | $329.1m | Local-share transfers, not the full amount hospitals receive after federal matching |

Source: [Central Health FY2025 audited financial statements, pp14 and 38](https://www.centralhealth.net/wp-content/uploads/2026/03/Travis-County-Healthcare-District-Financial-Statements_9-30-2025.pdf). These rows must not be summed into one “subsidy to Seton”; some are different stages or uses of public financing.

The service agreement makes the double-counting risk concrete. The original covered-services baseline was **$73.6 million for October 2013–September 2014**, with subsequent adjustment provisions. Specified Travis-related disproportionate-share and uncompensated-care receipts reduce the program amount due. The historical baseline is not today’s annual check, and adding the baseline to the very reimbursements that offset it would exaggerate the public payment. [Omnibus agreement, §§4.1–4.3 and 4.7](https://www.centralhealth.net/wp-content/uploads/2020/09/Omnibus-Healthcare-Service-Agreement-Initial-Agreement-06_01_13-09_30_281.pdf)

What the district buys is an enforceable bundle of services and access commitments. Evaluating performance requires current eligible-patient volumes, services delivered, denials, wait times and the contract’s payment reconciliation. Tax returns alone cannot establish that patients received the access purchased. The master agreement also preserves boundaries around Catholic ethical directives and services handled through other arrangements, illustrating that public financing does not convey unrestricted clinical control. [Master agreement](https://www.centralhealth.net/wp-content/uploads/2018/01/Amended-and-Restated-Master-Agreement.pdf)

The university-payment litigation and the hospital-service dispute should also be kept separate. An August 2026 appeals decision dismissed the remaining taxpayer claims over the UT payments; that resolves a legal issue, not the question of health outcomes purchased per dollar. I did not establish a final current disposition of every Ascension contract claim and do not present one. [Appeals decision](https://law.justia.com/cases/texas/third-court-of-appeals/2026/03-24-00408-cv.html)

## 7. Why I would not publish a new exact tax-deficit ranking yet

The property denominator has a substantial unresolved attribution discrepancy. HHSC’s 2024 contractor report assigns Seton Medical Center **$1,348,062** in hospital property value and **$24,390** in modeled annual property-tax benefit. TCAD’s 2023 public search lists the main Seton Medical Center parcel alone at **$287,200,239**. 2023 is the year the contractor says it generally used; the report does not disclose the parcel-specific years or interests underlying these campus estimates. The report assigns Shoal Creek $360.85 million, while its main parcel is $18.46 million. [HHSC report, PDF pp60 and 62](https://www.hhs.texas.gov/sites/default/files/documents/charity-care-hospital-transparency-report-2024.pdf) · [TCAD search](https://traviscad.org/propertysearch)

A hospital may own multiple parcels, and a parcel’s displayed value does not establish its exemption. Those qualifications prevent substituting my spot checks as corrected hospital totals. The scale of the difference nevertheless requires an explanation of which parcels and interests the contractor included or excluded. The report needs an explicit parcel crosswalk before those campus allocations can support a precise conclusion.

HHSC itself warns in the report’s introduction about consistency and accuracy problems and explains that the contractor’s approach differs from the agency’s usual comprehensive assessment. The report publishes the contractor work and contributor comments without amending either. Industry objections are therefore not automatically confirmed corrections, but neither is the table a clean agency validation. [HHSC report, PDF p4](https://www.hhs.texas.gov/sites/default/files/documents/charity-care-hospital-transparency-report-2024.pdf)

The counterfactual matters too. HHSC includes some government-owned property as a benefit to its hospital operator. Lown explicitly excludes city-, county- and public-hospital-authority-owned property from its private-hospital property-tax calculation. Private leasehold interests in exempt property can have separate tax treatment under Texas law. Dell Seton’s university land, hospital building and sublease therefore need to be examined separately; public land alone does not establish zero incremental benefit. [Lown methodology, pp13–14](https://lownhospitalsindex.org/wp-content/uploads/2025/04/fair-share-2025-appendix-20250409.pdf) · [Texas Tax Code §25.07](https://statutes.capitol.texas.gov/Docs/TX/pdf/TX.25.pdf)

A new subtraction using unmatched tax estimates and charity figures would manufacture precision. The dataset therefore preserves the published estimates, their dates and verification status, without using missing or unresolved values as zero.

## 8. Do nonprofit hospitals charge less?

RAND provides a limited empirical test using claims-based commercial allowed amounts rather than list prices. In its corrected Round 5.1 annex, seven local hospitals have reported inpatient ratios based on **785 sampled stays across 2020–2022**:

| Hospital | Commercial inpatient payment as percentage of simulated Medicare | Sampled stays |
|---|---:|---:|
| Seton Medical Center Austin | 386% | 71 |
| Seton Hays | 316% | 70 |
| St. David’s South Austin | 303% | 121 |
| St. David’s Medical Center | 300% | 119 |
| St. David’s Round Rock | 275% | 76 |
| BSW Round Rock | 261% | 84 |
| St. David’s North Austin | 211% | 244 |

Source: [RAND corrected report and annex](https://www.rand.org/pubs/research_reports/RRA1144-2-v2.html). The ratios compare each hospital’s sampled private payments with simulated Medicare payments for the same services there. They do not hold the payer or service basket constant across hospitals.

The sample does not show a simple nonprofit discount. It also does not justify an ownership ranking. For childbirth specifically, Seton Medical’s ratio is 143% versus North Austin’s 147%, based on just 16 and 76 stays. That reverses the implication a reader might draw from their all-inpatient comparison. I retain the observations and reject a causal or current-market verdict.

## What the evidence supports

**Nonprofit hospitals provide measurable benefits, but no single published Austin total establishes how much additional benefit the exemptions buy.** Patient assistance, community grants, subsidized services, teaching and research are real potential benefits. Their value depends on what was delivered, which other payer financed it, and whether the public would have obtained it without the exemption.

The useful local ledger has three separate parts: tax privileges attributable to the particular entity and assets; payments for care that government has already purchased; and the remaining unreimbursed activity, accompanied by patient-access outcomes. A fourth step asks how much of that remaining activity exceeds what a comparable taxable provider would have delivered. Existing academic work has already posed that incremental-benefit question; Austin’s hybrid ownership makes its local identification harder.

The strongest findings here are high-confidence reconciliations: shared reporting identifiers, documented partnership interests, the exact zero-floor arithmetic, the separation of public funding streams, and the discrepancy between a published campus property estimate and a 2023 appraisal record. The financial and price comparisons are descriptive. Complete current beneficial cap tables, parcel exemption records and patient-access outcomes remain less certain.

The evidence that would materially change the assessment is specific: a dated parcel-by-parcel tax reconciliation; supplemental-payment worksheets separating current care from settlements; current contract invoices and offsets; and independently checked service access for eligible patients. Those would permit a local tax-versus-benefit estimate with an accountable denominator and a measure of what patients actually received.

Until those are joined, the defensible conclusion is narrower than either “nonprofits earn every tax break” or “nonprofit hospitals provide nothing in return.” Austin has substantial charitable activity inside commercial hospital ventures, proprietary hospitals inside nonprofit systems, and public funding inside the community-benefit accounts. Following those relationships changes which questions can be answered—and which headline totals deserve trust.

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## Accompanying evidence

The native article provides the hospital census, financial and price tables, public money flows, source register and methods. No hospital or district was interviewed; the findings rest on public records and the stated calculations.