2. Hospital Growth Machines and Colonizing Brownfields

Biomedical institutions operate on land and engage in territorial strategies, such as property acquisitions. Hospitals in particular pursue development goals that actively shape space, including both local place-based investments and transnational infrastructure. The health sector interfaces with and facilitates the racially inequitable property system. Biomedical institutions inevitably participate in legacies of segregation and oppression that are spatially manifested in urban regional economies—in the arrangement of residences, work life, infrastructures, public services, and financial priorities. Redlining, to return to that example, secured spaces for white investment and subsidized white life through the exclusive location of and restricted access to safe environments and health services, such as hospitals. Conversely, this urban land management practice limited nonwhite and poor people’s ability to secure financial resources necessary for building wealth; it also contained them in undesirable areas of the inner-city or industrial periphery. U.S. land policies have denied economic and health resources to a significant portion of the population even as, contradictorily, public health and civic-oriented ideals, from sanitation to land revitalization, have been used to frame and maintain the racialized property system.

U.S. urban policies have historically driven health policy toward property-oriented growth with racially oppressive effects. Examples include the institutionalized segregation of hospitals in terms of location and access at the regional and citywide level; and the highly localized experiences of medical and food scarcity, insurance discrimination, and other pervasive forms of medical redlining.1 Hospitals contribute to this complex geography of health and racial disparity in many ways, including their role as historic land-grab institutions and land developers, propelled by urban policies that funnel capital into real estate. Hospitals and public health have featured prominently in efforts to target land for redevelopment, exacerbating segregation and displacing residents of minority neighborhoods to facilitate the expansion of high-end service industries in urban cores where manufacturing has declined. As I explained in chapter 1, land has consistently been made available for redevelopment through colonizing discourses of blight, public improvement, and health tied to economic productivity, which erase or denigrate nonwhite spaces and communities to prime land for seizure. Biomedical institutions participate actively in the racializing and fiscalizing of land, a process that creates a medical brownfield frontier for urban redevelopment projects with privatizing and profit-making aims often couched in civic ideals. The land-grant legacy of stolen Native land to support agriculture and rural area development became a dominant paradigm for urban land-grant universities and urban development partnerships involving hospitals, thereby highlighting land dispossession as the base of the U.S. property system’s financial mechanisms and civic notions of public goods or benefits.2

Hospitals have long served as instruments of urban renewal and economic growth; they enhance property values and raise revenues. According to urban health historian Guian A. McKee, federal programs motivated the expansion and modernization of urban hospitals during the post–World War II period both directly, through subsidies, and indirectly, through tax expenditures.3 These public policies supported the physical growth of urban health care institutions and their research activities, with hospitals increasingly replacing factories as the urban economic core.4 Hospitals not only provided medical care but also took on the increasingly important role of anchoring postindustrial cities.5 The Hill-Burton loan and grant program, passed in 1946 as the Hospital Survey and Construction Act, offered federal matching grants for the construction of new hospitals and nursing homes, essentially covering 10 percent of the construction costs.6 Initially slated for rural areas, a 1964 amendment permitted the program to issue grants to modernize existing hospitals regardless of previous per capita bed limitations. The Housing Act of 1949 offered local governments a “write-down” subsidy that covered two-thirds of the cost of assembling and clearing blighted land for “predominantly residential” redevelopment.7 Section 112 of the 1959 amendments gave hospitals the opportunity to take advantage of the federal subsidy; it presumed that urban renewal conducted by and for private institutional purposes aided the public good.8 Once legislation opened the door for urban renewal funding with no requirement for housing, medical facilities launched expansion projects and actively participated in what Malini Ranganathan frames as the “conjoined processes of racialized property making and property taking,” linking medical planning offices to citywide renewal processes.9 By 1964, U.S. urban renewal projects involved seventy-five hospitals, including major urban medical centers such as Johns Hopkins University Hospital in Baltimore and the Detroit Medical Center.10 The University of Alabama displaced over 10,000 Black residents of Birmingham to raise its now highly acclaimed medical research campus during this period.11 The paradigm of land-grant institutions evolved into a moral geography of civic duty to appropriate land to “solve” city problems.

Cities welcomed real estate projects in the health sector because they could claim these expenditures as local grants-in-aid matched by federal support at a 2:1 ratio, beyond which local funds could be banked as credits for future urban renewal projects.12 Aided by the moralizing discourse of blight that confounded public and private responsibility, select well-established urban hospitals benefited from funds to renovate buildings and inaugurate new centers within a health care system that remained largely exclusionary. Cities could apply banked hospital expansion credits toward expensive downtown redevelopment plans. Hospitals, nursing homes, and other medical clinics would also enter into real estate ventures in the expanding white suburbs, with subsidized new facilities that contributed to the racialized arrangement of urban regions. Even after federal support shifted from direct spending to loans, with hospitals financing a greater percentage of construction through debt financing as opposed to raising capital, the government continued its subsidies by guaranteeing hospital mortgages.13 The Federal Housing Administration, well known for its role in promoting suburbanization and subsidized white flight, buffered massive hospital expansions and growth through a mortgage insurance program by which hospitals saved millions in debt service because of reduced interest rates.

This brief gloss of an earlier period of urban renewal affecting U.S. cities underscores how cities channel capital into local real estate assets through health care institutions. More broadly, it indicates the fiscalization of municipal land use decisions, which, for local governments, increases the value of taxable resources in order to raise revenues without rate hikes.14 Faced with the political imperative to build and the capitalist demand for liquidity, local states have developed mechanisms that discursively code and order the meaning of place to make the built environment more responsive to the investment criteria of real estate capital.15 Tax increment financing emerged as one such strategy. Cities historically used TIF to raise local contributions, which were required by the urban renewal program to obtain federal matching funds for redevelopment projects. TIF entailed designating a quasi-public development authority and territorially defining a submunicipal area, thus delineating blighted properties as special tax increment districts where municipalities would fund projects up front by pledging future property tax revenues as security for current borrowing.16 The portion (increment) of taxes generated as a result of the redevelopment would, in theory, finance the improvements. In this way, cities obtained capital by turning rights to their own heterogeneous property tax base into standardized tradeable assets.17 TIFs fortified physical infrastructure, land acquisition, site clearance, and other programs that reduce a developer’s capital costs, as cities gambled on future appreciation in the value of land and buildings within the demarcated geographic area. By codifying select areas as blighted as a precondition for investment, TIFs justified land grabs under the proviso of future returns and economic benefits. This fiscal-territorial strategy of development is now widely used by local governments as an all-purpose tool for financing public investment. TIF-backed projects can be found in suburbs and edge-city interchanges in addition to the inner city.18

Recent decades of urban redevelopment projects have implemented TIFs to revitalize downtowns within the former industrial core of cities. Between 1992 and 2007, the U.S. Department of Housing and Urban Development made nearly $80 billion available for inner-city redevelopment of underutilized public housing and postindustrial blight.19 When property values decline because of environmental contamination, cities may freeze the value at the reduced level and consider any restored property value as the increment on which to finance the cleanup. As previously discussed, brownfield policies routinely involve TIFs, tax breaks, and other incentives to redevelop contaminated land. Brownfields codify a postindustrial frontier of available contaminated land. The remediation of this frontier provides the material basis for entrepreneurial forms of property redevelopment and waste management. The discourse of blight allows brownfield policy and practice to claim public health benefits, all while restricting liability and lowering cleanup standards tied to “productive” future land uses.

Hospitals and other parts of the U.S. health care sector participate in these efforts to revalorize devalued landscapes. This is especially visible in the redevelopment of urban military areas, where, in spite of remediation requirements, property redevelopment promises high returns and reduced risk to developers. St. Anthony Central Hospital in Denver, Colorado, for example, took advantage of a land deal to relocate the facility to a land parcel formerly part of the Denver Federal Center and its World War II–era military ordnance testing range. This brownfield move enabled the hospital to turn over its previous location for a profit. The Denver Urban Renewal Authority has redeveloped the former 18.85-acre St. Anthony campus in the West Colfax neighborhood, including a nearly $40 million TIF-financed rehabilitation of a 44,000-square-foot building that features retail and restaurant space as well as market-rate townhomes.20 With no shortage of brownfields from military activity along Colorado’s Front Range, the Denver suburb of northwest Aurora converted the Fitzsimons Army Medical Center into the 227-acre Anschutz Medical Campus for the University of Colorado and the University of Colorado Hospital.21 Since the base closed, the Fitzsimons area has become one of the largest medical redevelopment projects in the United States, requiring remediation of three military landfills that reportedly comprise the largest landfill remediation effort in the state of Colorado.22 A combined Anschutz Medical Campus and Fitzsimons Life Science District are undergoing an over $4 billion transformation into a multizone educational, research, and clinical national center. Hospitals take advantage of brownfield strategies in their real estate pursuits; this raises questions about public process, accountability, and governance of remediation. Such remediation efforts may entail less stringent environmental cleanup standards at the sites where medical services will be provided.

Hospital rehabilitations and expansions also claim immense resources under the auspices of improving the environment, ameliorating urban poverty, and lifting property values, even as they continue to play a role in perpetuating uneven geographies of health and property value in the regional economy. Examining the policy environment and practice of this medical brownfield frontier through the policy arena known as Eds and Meds further delineates the toxic, extractive, and racist property system in which biomedical land developers participate and profit. Eds and Meds development policies seek to remedy postindustrial blight and contamination and foster urban growth tied to research university medical centers and teaching hospitals, which are perceived as powerful economic engines. The policy framework stems from decades-long discussions of “anchor institutions” as a critical component of inner-city revitalization strategies. The basic idea is that benefits from anchor-based economic development will eventually trickle down to inner-city residents in the form of jobs, access to services, and neighborhood amenities.23 Advocates insist that these institutions have the capacity to create centers of innovation and learning with a large stake and important presence in cities and their surrounding communities. Accordingly, they are job generators with multilevel employment possibilities; they attract businesses, highly skilled individuals, and spin-off ventures; and they consume sizable amounts of land and are unlikely to relocate.24 Research on Eds and Meds highlights the contributions hospitals specifically make to cities in terms of expenditures, employment, and real estate development, especially their investments in facilities and specialized technology. Some hospitals have large land holdings located in central cities; others serve as a focal point of ancillary health care businesses, including physicians and medical specialists. These institutions are increasingly part of medical campuses that include facilities dedicated to medical education, biomedical research, long-term care, and outpatient care.

Thus, “Meds” usually refers to teaching-intensive, high-income hospitals and some specialty hospitals—those powerful and resource-rich acute care facilities that are likely to spend money on community economic development and promote health missions tied to generating economic returns on land redevelopment. These elite Meds, which are predominantly nonprofit institutions exempt from federal, state, and local taxes, take center stage in urban governance efforts to offset the costs of city services and to stimulate local growth. Because the health care sector has been one of the few consistent economic growth areas in U.S. cities through the late twentieth and early twenty-first centuries, city officials see elite hospitals or systems as generators of new monies with spillover effects.25 Institutions like the Cleveland Clinic, University of Alabama Hospital, University of Pittsburgh Medical Center, and other university-affiliated hospitals offer export-based industry status: they provide clinical training for medical students and health care professionals, and physicians on staff frequently are experts in their field with access to the most advanced equipment.26 By attracting in-migration and developing human capital, such hospitals are hailed for growing entrepreneurship and prioritizing diverse local suppliers.27 City officials especially look to Meds’ campus investments to increase land values. Their dominant policy approach has been to position biomedical institutions as land developers by using municipal authority to assemble land parcels for campus expansions and by engaging in public–private or public–public partnerships that target neighborhood development.28 When institutional improvements drive up neighboring land values, the city’s increased revenues help compensate for the property tax exemptions that the institutions enjoy.29 Moreover, hospital development is perceived to be a place-making activity capable of maximizing welfare and distributional equity, reducing intrametro disparities, and offering formal strategies of upward mobility in employment like skills attainment and credentialing for inner-city communities. Moral arguments surround Eds and Meds policy, including social responsibility and a pedagogic duty to provide models of responsible citizenship and good neighborliness—civic virtues that supposedly can be mobilized to embed capital accumulation in public service.30 Such appeals are used to justify the tax exemptions that these institutions enjoy.

This policy framework, however, implants a nonprofit medical complex in American cities, particularly those in financial distress and near–municipal bankruptcy conditions, by offering tax breaks in exchange for trickle-down benefits. Participating institutions are able to exploit public subsidies and devalued land; they implement predatory forms of financial extraction using the colonial rhetoric of educational mission and nonprofit charity work. Eds and Meds create and exploit medical brownfields that locally manifest in some of the worst disease rates and racialized health disparities in the United States at the very sites of top national and renowned hospital care. This colonial process encourages and organizes land grabs that are based on discourses of blight and waste-ability, imposes fiscal eminent domain that channels resources to development authorities and their territorial projects, and claims to offset the corrosive effects of this brownfield frontier on surrounding residents through local benefits and sustainability initiatives. A poignant example, medical administration and care in Camden, New Jersey, demonstrates the institutionalization of racial inequity in ways that reveal how some Meds projects intensify geographies of waste and race, stripping assets with devastating effects on local residents.31 After the collapse of its manufacturing base and decades of white flight and disinvestment, Camden has turned to large-scale waste processing—a regional sewage treatment plant, open-air sewage sludge composting facility, trash-to-steam incinerator, power-cogeneration facility, coke transfer station, chemical companies, cement-grinding plants, and more—as the means to reverse industrial decline within a deeply racialized region. The presence of these toxic industries, combined with poverty and violent crime, all have contributed to a dire public health problem in Camden, where the city’s residents are majority Black and Latinx. In the same area of this proliferating waste industry and humanitarian crisis, Camden currently hosts a growing nonprofit medical complex that facilitates developmentalist nongovernmental organization interventions to help poor people who have inadequate health care. Politicians have pushed an Eds and Meds approach to land redevelopment, with higher education and health care nonprofits as anchor institutions for the city’s “rebirth,” along with the state’s designation of Camden as a growth zone that offers major tax breaks.32

On one end of the spectrum, Camden has innovated a data-based approach to decreasing exorbitant health care spending on the medically indigent. This strategy, known as “medical hot spotting,” entails sharing medical metadata across hospitals, jails, and schools; it uses GIS technologies to locate and target “high utilizers” of intensive, uncompensated outpatient care, for the purposes of motivating them to do better self-care and cost the system less.33 Such “care” tries to integrate people within the surveillance of poverty. This has reportedly included job training for residents in medical data entry to support a medical intelligence industry that intensifies the division of labor of managing the poor. Medical hot spotting also remains wedded to a biomedical model of intervention that does not address Camden’s environmental health conditions, where long-standing environmental justice activism has fought widespread toxicity and hazards that attenuate quality of life, including some of the highest asthma rates in the country.34 Camden has attracted high-end hospitals, such as the research facility and teaching-oriented Cooper University Hospital, that operate with little reference to the surrounding poverty and environmental health inequities experienced by Camden residents. The affluence of this elite nonprofit institution and other trophy companies purportedly trickles down to the local population, yet the tax exemptions that drew them to Camden facilitate billions in private profits and lost property taxes, thus stripping the city of its tax base.35 Their infrastructural demands, security theater, and philanthropic support for local amenities like parks and heritage district revivals perpetrate and obscure violence within the urban community.

The land development strategies of the Cleveland Clinic in Cleveland, Ohio, underscore how nonprofit hospital tax exemptions may intensify legacies of Jim Crow segregation. The nonprofit academic medical center’s unrelenting expansion of operations—what local African American residents have characterized as “the plantation”—thrives on the surrounding neighborhoods’ dereliction and abandonment.36 The main campus occupies an ever-expanding seventeen-block stretch of land, with smooth roads, paved bike lanes, and glassy white buildings connected by skyways. The campus has its own private police force, hosts a high-end InterContinental Hotel, and offers a variety of amenities akin to an airport terminal or resort, with live music, shopping, and a farmers market. The second biggest employer in Ohio (just behind Walmart), pride of Cleveland, and one of the most prestigious hospitals in the world, the Cleveland Clinic’s treatment of the land and surrounding neighborhoods as a special medical district and development platform has led to starkly uneven health care disparities. One of the best-known global brands in health care buttresses local conditions of medical apartheid. The surrounding neighborhood of Fairfax has an infant mortality rate nearly three times the national average; more than one third of residents in the census tract surrounding the clinic have diabetes; and the predominantly African American population experiences higher rates of cancer, chronic kidney disease, and coronary heart disease.37 While wealthy international patients receive heart transplants at the clinic, local people do not go there for an emergency; in fact, the hospital has been sued for not providing enough emergency care. Like many high-end hospitals, attracting wealthy patients and expanding operations to global cities such as London, Toronto, and Abu Dhabi take precedence over serving poor patients for Medicaid rates or receiving the fractional payouts and charity write-offs for treating the uninsured.

As a tax-exempt organization, the Cleveland Clinic saves tens of millions in annual property taxes from its billion-dollar property value, with only a loosely defined commitment to reinvest in the local community. The clinic claims that it is in fact improving the surrounding area, which is beset with vacant lots, abandoned structures, and bail-bond outfits, and that its world-renowned physicians and well-paying jobs lift up the community. Yet in a grotesque extension of urban renewal’s draining of wealth from inner-city areas through investments in white suburbs and highways, the institution has pursued an over $300 million project called the Opportunity Corridor. Construction of this three-mile highway requires ripping up streets and tearing down residential and commercial buildings, ultimately to expedite shuttling staff and patients to the hospital’s sea of parking garages from Interstate 490.38 The boulevard construction vacuums up what could have been the clinic’s property taxes and local investments in schools and city services: providing out-of-hospital care and social support, acculturating local workers successfully in clinic jobs, monitoring neighborhood health, and engaging in land remediation to address lead exposure are equally as important as treating heart attacks.39 The Cleveland Clinic reveals the way that medical brownfields service extraterritorial enterprise zones that perpetuate financial, infrastructural, and medical redlining across generations and transnational space. As home foreclosures continue to unfold, with Cleveland a ground zero for the 2008 subprime mortgage crisis and its predatory lending targeted at Black citizens, the racist tautology of home repossession as dispossession has provided the terrain for the clinic’s most ambitious land grabs yet. Clinic master plans reenvision the surrounding East Cleveland neighborhoods as a blank slate for a continuous “green spine” campus park, revealing the colonial operations of a green brownfield frontier and renewed rounds of redlining as greenlining. The ongoing racial violence of the Covid-19 pandemic has given the clinic further rationale for land grabs, supporting a humanitarian spectacle that obscures its parasitical relationship to place. The clinic is currently developing an over $500 million “innovation district” that will feature world-class research institutes devoted to Covid-19 and other global pathogens. It is to be placed on land comprising the historically Black neighborhood of Hough, which has been devastated by Covid—further compounding the previous waves of foreclosure and hospital land seizures after racial uprisings.40

Johns Hopkins University (JHU) has been the largest landholder and biggest builder in Baltimore; it has even formed its own full-service real estate development subsidiary, which offers a range of expertise in land planning, financing, construction, and property management for tenants of its medical center.41 The Johns Hopkins Health System has unveiled plans for a $400 million, twelve-story research tower on its East Baltimore main campus, which will solidify its status as a global medical research hub.42 Constituting an even larger part of JHU’s footprint in Baltimore is the East Baltimore Development Inc.’s massive eighty-eight-acre territory, which seeks to leverage its proximity to the Hopkins Homewood campus and provide millions of square feet in life sciences research and office space, in addition to mixed-income housing, schools, parks, and retail.43 After years of delays and setbacks, the project has aggressively torn down approximately two thousand of the surrounding neighborhood rowhouses and relocated over seven hundred families. What was once the thriving blue-collar Black neighborhood known as Middle East has been rebranded Eager Park. In spite of East Baltimore Development’s careful language and emphasis on Black citizens returning to a renewed neighborhood, the project bears a striking similarity to previous JHU-led property occupation and expansion, including a fifty-nine-acre urban renewal project that displaced more than a thousand families in the 1950s.44 The zoning maps delineate a medical brownfield frontier wherein every census block has been placed in the bottom categories of “stressed” and in need of “comprehensive housing market interventions . . . including site assembly, tax increment financing, and concentrated demolitions to create potential for greater public safety and new green amenities.”45 Residents and activists have fought for fair compensation and relocation terms, as well as to ensure demolitions are conducted safely, without stirring up massive contaminants. Thus far the redevelopment zone features housing exclusively for graduate students, a new public school with very few spots for local children, renovated rowhouses and a townhome complex that JHU heavily subsidizes for its employees, and a Marriott Residence Inn facing a park on a block where forty rowhouses once stood.

In a move indicative of the national prioritizing of citadels of acute care against urban unrest, the privately held, multibillion-dollar operation of JHU simultaneously seeks the authority to establish its own armed police force to secure its Baltimore urban campus and hospital, as well as its domestic and global facilities. After the uprisings in response to the death of Freddie Gray in police custody in 2015, JHU has spent more than half a million dollars lobbying for expanded policing powers that increase the risk of racial profiling and brutality for students, employees, and members of the surrounding community, although it suspended the effort momentarily in 2020 during the global Black Lives Matter protests and civil uprisings.46 Such private police forces across the country receive little public oversight or scrutiny, yet their officers carry weapons and often operate with full police power on campus and across adjacent city blocks.47 JHU contends that these resources are necessary to safeguard its educational mission and partnerships with the city. The situation reflects the decades-long parallel public policy track of “investing in cutting-edge, high-tech solutions and an emergency medicine system that has been a poor fit for the general health of many Americans, especially the poor and uninsured who lack adequate facilities and basic care in their communities” while also investing in police forces and systems of incarceration that disproportionately harm BIPOC communities and exacerbate the convergent American health epidemics of racism and gun violence.48 Nic John Ramos explains that cities have prioritized resources for publicly funded emergency medical response, prisons, police, and fire departments while defunding public hospitals, clinics, and health education programs. This has essentially subsidized state-of-the-art facilities like JHU for privately insured Americans and global consumers; these facilities offer costly acute care and emergency services, especially for rare and singular diseases or for end-of-life care, instead of developing capacities for low-cost preventive health care to support health equity and guide reparative justice in everyday life and death.49 The extreme life-threatening health disparities of Baltimore residents exemplify the damaging effects of this discriminatory convergence of health and urban policy. Indeed, the Washington Post reports that in a city with one of the country’s premier health institutions, average life expectancy in numerous Baltimore neighborhoods is lower than that of economically collapsed countries in colonial war zones, with eight ranking lower than Syria. If the life expectancy of residents of the affluent neighborhood of Baltimore’s Roland Park is similar to Japan’s, then that of residents of the downtown/Seton Hill area is closer to Yemen’s.50

These city cases reveal tautologies of racial violence. U.S. urban policies have driven hospitals toward property-oriented growth, with racially oppressive responses to urban unrest. U.S. health policies have supported a model of private health care citadels with emergency services in the context of general medical scarcity for poor and uninsured people. The property-based orientation of Eds and Meds boosterism enacts a brownfield frontier imagination that facilitates colonial land grabs in the name of urban revitalization, sustainability initiatives, local place making, and other extensions of the discourse of blight. It fails to consider how anchor institutions were born from land theft, public subsidies, and, in the case of advanced acute care and premier hospitals, biopiracy and the medical abuse of nonwhite and vulnerable subjects.51 The historical grave robbing of Black bodies and the stealing of Henrietta Lack’s cancer cells for medical research supported the very rise of Johns Hopkins as a renowned research university that today receives more federal research funding than any other.52

Such cases demonstrate some of the ways that medical brownfields reterritorialize governance in the austerity state. They create a fiscal environment for complex quasi-public mechanisms, territorial policing, and other powers that facilitate local large-scale land redevelopments, skirting neoliberal retrenchment of federal assistance and often bypassing legislative hurdles, electoral politics, and long-established constitutional limits on debt.53 This third sector of the U.S. economy, which combines marketplace and governance and which operates outside the boundaries of formal government, can in part be traced back to nonprofit public benefit corporations and municipal improvement authorities advanced by U.S. presidents Hoover and Roosevelt since the 1930s as a way to build public works without bankrupting municipal treasuries. Instead of using taxes and direct payment to pay for projects, these quasi-public development authorities split from electoral politics to redevelop land and pay for projects by borrowing against future revenues.54 More recently, the neoliberal era has seen a profusion of special-purpose authorities, commissions, and partnerships that make it easier to borrow money without that debt counting as part of a city’s total indebtedness, thus circumventing debt limits as well as the reporting requirements of government departments. For example, a twenty-year economic development initiative, Destination Medical Center, authorizes public investments and public governance structure to help support the Mayo Clinic’s continual growth via a $5.6 billion plan to convert Rochester, Minnesota, into a global medical destination center. The Destination Medical Center master plan seeks to transform Rochester’s urban center and waterfront into six subdistricts to serve as an extension of the Mayo Clinic. The plan remasters Rochester in the Mayo Clinic’s image, complete with a rebranded downtown and a slogan, “The Heart of the City,” referring to Mayo’s expertise in cardiology and heart surgery.55

With the proliferation of municipal regimes that actively make landscapes amenable to quick excavation of value, redevelopment authorities function as debt machines without voter approval. These regimes do not have to consult the electorate over spending and borrowing; they can raise revenue through user fees, grants, and bond issuances on the capital markets.56 Advocates of market discipline aver that self-supporting enterprise funds and public authorities are possible and desirable, but in actuality, they are not free from the broader political economy and can have negative effects within racialized urban regions, as the examples above have considered. Establishing development authorities diverts city revenues to pursue pro-growth development, often resulting in property speculation and public giveaways that guide the “place and pace of the speculative activity.”57 Once a redevelopment project is created, all property tax increment directly channels to the agency in charge, when such funds could have been used to keep open libraries, staff emergency rooms, and support other urgently needed services. Redevelopment authorities perform eminent domain in not only a territorial sense but also a fiscal one. Such medical brownfields perform what Clyde Woods calls “trap economics”: they strip local assets and transfer wealth.58

Discourses surrounding hospitals as urban anchors and growth machines solicit mass support by appeals to trickle-down benefits. Even as grassroots groups demand concessions and local governments organize community development agreements with job training, educational investments, low-income housing, or other amenities, the trickle-down model facilitates a territorial trap—that is, gentrification processes displace inner-city residents, exacerbating tensions between job creation and property value increases, as well as diminishing municipal capacity to generate revenue for both operating budgets and capital budgets. TIFs, for instance, mount property tax losses for investments at large because money stays in that particular submunicipal territory, foisting the property tax burden for public provisions onto the remaining taxable property owners. Eds and Meds development projects concentrate tax-exempt properties and thus weaken the municipal tax base substantially, adding stress to the delivery of social welfare programs and public services.

Furthermore, the consumer framing of such zones obscures who ultimately pays for the infrastructure and other benefits—as well as the costs, such as inadequately funded maintenance or congestion—that receipt of services imposes on others. Anchor institutions are heavily subsidized by public expenditures and other government resources that form the social safety net in inner-city neighborhoods, including not only brownfield remediation but also housing, parks, grocery stores, and recreational facilities.59 As land developers, elite nonprofit hospitals prosper in low-revenue municipal environments. A pro-growth rhetoric of place making shrouds the exclusionary practices and fiscal appropriation orchestrated by development authorities that operate outside of democratic process. Despite efforts to retain locally specific obligations, whether related to aesthetics, environmental sustainability, contracting prices, job creation, or diversity, development authorities use highly opaque financial instruments built around idiosyncratic investments and specialized information that can result in pay-to-play scenarios and investment schemes that leave cities encumbered by high-interest debt on usurious terms.60

The tax exemption status of a mounting nonprofit philanthrocapitalist medical complex creates an environment where medical brownfields flourish and perpetuate urban blight. Nonprofit hospitals enjoy multiple public subsidies through Medicare and Medicaid, public and private insurance programs, and tax-exempt status. Historically, most hospitals in the United States have been recognized as charitable organizations excepted from taxes under section 501(c)(3) of the U.S. tax code. In exchange, the IRS requires that nonprofit hospitals provide a significant amount of care for the poor, also known as charity care. After Medicare and Medicaid were established in 1965, the hospital industry claimed that there would no longer be enough demand for charity care to fulfill the IRS’s tax exemption standard (because Americans would supposedly be covered by one of the two programs or by private health insurance); the industry pushed for a more flexible exemption standard that became known as the “community benefit” standard.61 While charity care remains a key component, the historical shift indicates the changing vision of civic leaders and legislators toward hospitals and academic medical centers. Beyond simply providing direct patient care, the mission of hospitals could expand to encompass health promotion, poverty relief, education, and a wide range of activities deemed beneficial to the community.62 The ambiguity of community benefits has allowed many hospitals to include a bewildering array of expenses in their accounting to the IRS, including unpaid patient bills and tallies of the difference between the list prices of treatment they provide and what they are paid by Medicaid and Medicare.63 Contributing to debates about not-for-profit fiscal responsibility, many elite nonprofit hospitals spend significantly less on charity care than the tax breaks they receive. Some Eds and Meds institutions make payments in lieu of taxes, known as PILOTs, to partially offset the foregone property tax revenue. However, this kind of flat fee hardly compensates for the lost revenue or broader costs of providing infrastructure and services, which are shifted to local residents and increase their relative tax burden.64 As a result, section 501(r) was added to the IRS tax code as part of the Affordable Care Act to further delineate what counts toward tax-exempt status.65

Many poverty alleviation programs and career ladder programs are financed with “demonstration” funding and philanthropic contributions in place of public sector investments.66 Within the hospital sector, policies to engage the poor in employment opportunities exhort people to earn their way out of poverty, but without providing the work-based learning models or mentoring needed to advance along skill and pay tracks. The nonprofitization of federal urban policy has devolved federal funding and decentralized community development policy to the local level, relegating local development to nonprofit networks led by foundations and anchor institutions. The withdrawal of federal resources designed to assist residents who have been negatively affected by urban redevelopment has meant that cities must rely on philanthropic contributions to support any social safety net, and urban residents in need of public services must negotiate a complex web of organizations engaged in urban revitalization.67 Pro-growth Eds and Meds urban policies offer dubious improvements to the actual health care quality and wellness of neighboring residents and local workers.68 As employers, these institutions notoriously set the nonprofessional wage ceiling in cities, with their reliance on tiers of lower-waged workers, including technicians, nurse’s aides, custodians, and food service workers.69 Elite medical campuses that attract nonresidents seeking state-of-the-art medical treatments may actually contribute to reducing access to general health services for local indigent populations.70 Health care markets harm low-income people when competition among medical facilities erodes the cross-subsidies that have financed access to care.

Undoubtedly many hospitals serve as integral components of the social safety net by filling in roles as primary providers of publicly subsidized health care. Numerous nonprofit institutions support local government provision of public goods and have organized a variety of public assets or concessions, including affordable housing, improvements to schools and community facilities, local employment, returning-citizen recruitment, job training, and minority procurement. The Greater University Circle Initiative, for example, a partnership between the Cleveland Foundation and local advocates with Case Western Reserve University, University Hospitals, and the Cleveland Clinic, has sought to boost income and opportunities for residents of the seven low-income neighborhoods surrounding them by collaborating on transportation infrastructure, pooling purchasing power, and channeling business to local, employee-owned cooperatives.71 In other cases, teaching hospitals have organized programs that place medical students in local high schools to promote health, or to facilitate communication among local leaders of faith, schools, neighborhood organizations, and clinics. Such contributions emanate from hard-fought local struggles and decades of activism; they are the fruit of long-term public demands for community benefit agreements to support inner-city residents affected by the expansion of anchors.

Even as cities face financial conditions that make it difficult to justify public investments that are not fiscally productive, some elected officials and local states have pressured hospitals and health systems into providing more community support, vehemently criticizing the disparity between the charity care and benefits offered by hospitals compared to their tax exemptions and CEO incomes. This is in part due to the changing nonprofit model, which has come to resemble that of for-profits under conditions of vigorous price competition.72 A business model mimicking for-profit strategies has incentivized the creation of not-for-profit corporate structures and integrated academic health systems, with huge increases in recorded earnings and extractive relations with their local places and ecologies. Between 2001 and 2006, the combined net income of the largest nonprofit hospitals jumped nearly eightfold to $4.27 billion, with the Cleveland Clinic leaving the red to run up a net income of $229 million during that period. The nonprofit hospital system Ascension Health had amassed $7.4 billion through that time period.73 Much of the nonprofit hospital industry’s income growth has come from predatory strategies designed to increase revenue, among them prioritizing expensive procedures; greatly inflating list prices for procedures and services; requiring up-front payment; selling patient debt to collection companies; and issuing tax-exempt bonds and investing the proceeds in higher-yielding securities.74

This has exacerbated the massive disparities and operational asymmetries between various parts of the health system. Nonprofit hospitals with considerable market power draw in wealthy clients and export services, divisively creating an impoverished peripheral set of charity-oriented nonprofit hospitals that face constant poverty triage, and tax-paying, for-profit inner-city hospitals geared toward stockpiling Medicaid patients. In the rapidly changing health care sector, academic medical center power increases, while other hospitals face extreme austerity measures and closure. A few highly competitive hospital networks have evolved that provide only limited care for the poor, excluding many of the nonprofit and public safety net hospitals that are financially distressed and unable to compete for private patients to stay afloat and offset the cost of subsidizing uncompensated care. In short, biomedical complexes and planned developments in which university teaching hospitals build out life science research facilities, specialty medical facilities, and myriad urban destination features depend on blight in surrounding neighborhoods through their extraction of land and predation on collective fiscal and social capacity. They burden residents with disproportionate tax loads and subsidies. They dump the fallout from expensive and inaccessible health care in the United States onto other hospitals.

This chapter has examined the domestic frontier of medical brownfields as territorial and fiscal enclaves that extract from the public sector and thrive on blight in various ways. In chapter 3, I turn to medical brownfields in the context of the international joint ventures and global medical entrepôts of elite U.S. hospital systems. The discussion considers how these medical nonprofits further entrench racialized disparities in global health via their transnational extension of specialty services, educative missions, and edifying development aesthetics.