The Biden administration is fighting limitations in its authority to slice carbon emissions out of the health-care sector, deploying mostly carrots to incentivize industry action because it has so few regulatory sticks. The problem is acute because health care makes up 8.5% of US carbon emissions, according to the White House. That’s nearly twice the amount the sector contributes globally.
In a bid to bring down those emissions, the White House has been promoting a range of tax credits available to health-care organizations in the recent climate law. The administration is also taking softer steps, such as urging hospitals to sign on to a voluntary climate pledge and publicly recognizing leading organizations.
But the federal government’s ability to curb emissions from the notoriously leaky sector is limited, because it doesn’t have the regulatory or enforcement authority to meaningfully change the way hospitals do business. In the meantime, emissions from the health-care sector are continuing to rise, spiking 6% from 2010 to 2018, according to the Commonwealth Fund. Those increases are mostly due to rapid growth in health-care spending generally, said Rachel Levine, assistant secretary for health at the Department of Health and Human Services.
“There’s not a simple solution,” said John Balbus, director of the Office of Climate Change and Health Equity at HHS. “It’s not like there’s a silver bullet here.” Two-thirds of health-care-related emissions come not from direct care providers, but from the supply chain—such as pharmaceuticals, IV equipment, food, the transportation required to ship all those supplies, and other areas. Those emissions are hard for regulators or hospitals to trim because they involve so many vendors in so many different industries.
Only about a third of health-care emissions come from hospitals themselves. Any cuts there are helpful because hospitals are the third-most energy-intensive types of industrial buildings, according to Balbus. Some hospitals are decades old, others are in serious disrepair, and still others are located nowhere near large-scale sources of renewable energy.
But hospitals are also where the climate law can have the most immediate impact. The law includes a wide range of incentives hospitals can claim, such as an investment tax credit for renewable energy projects; a credit for commercial clean vehicles, including buses and ambulances; an energy efficient commercial buildings deduction for improvements to HVAC, lighting, and building envelope systems; and the Rural Energy for America Program, which can be used for renewable energy systems and building improvements.
That money is especially helpful because so many hospitals are struggling to finance their operations, according to Jonathan Perlin, president and CEO of the Joint Commission Enterprise, the nation’s primary accreditation body for health-care organizations. It’s still too early to know how many hospitals have claimed the credits, in part because the pre-filing registration for direct payment only opened at the end of 2023, according to an HHS spokeswoman.
Large institutions also need time to plan capital outlays, according to Heather Cooper, a partner at McDermott Will & Emery LLP who tracks the climate law’s credits. Anecdotally, however, Cooper said hospitals do seem highly interested in the available deductions and credits.
A recent Commonwealth Fund survey found that 79% of clinicians want their organizations to play a role in addressing climate change. But the same study revealed that only 35% of health-care leaders say they’re defining or setting emissions targets, and just 44% say they’re working to understand their emissions footprint. At least some of those results stem from an entrenched historical attitude among many health-care professionals that their work is so critical it trumps all other concerns, according to Balbus.
“Many health care providers would say, ‘We’re doing really important work. We’re saving lives. We should not have to worry about how much energy we’re using.’ And many outside the health professions would agree with them. But that is starting to change,” he said.
That’s why the White House is working so hard to raise awareness about the climate law. In January, HHS unveiled a program to help health-care providers take advantage of the various tax credits and grants in the climate law for clean energy, building efficiency, and facility resilience. That work is crucial because, while the climate bill’s benefits “are incredibly helpful, they’re not well understood,” Perlin said. “There are literally billions of dollars in direct payments, cash credits, and tax credits for the sustainability investments, but to understand them, you need a couple of different sets of expertise.”
HHS is also updating existing tools and developing new ones to help hospitals assess their risks and vulnerabilities, Balbus said.
Nancy Foster, vice president for quality and patient safety policy at the American Hospital Association, broadly praised the Biden administration’s awareness-raising efforts, saying interest is steadily growing among the group’s membership.
“A lot of organizations are really craving information,” said Kara Brooks, senior associate director of sustainability at the American Society for Health Care Engineering. “Sustainability used to lie with the facilities management team, but more and more executive-level sustainability people are being hired at hospitals. And they do want education.”
Other groups are also pitching in. For example, the Joint Commission has a voluntary sustainable health-care certification that helps hospitals attract and keep young workers who care about the climate crisis, earn credibility in their communities, improve their finances, and create a healthier environment, Perlin said.
In a few cases, the federal government has taken more direct steps to move toward greening health care. Notably, last year the Centers for Medicare and Medicaid Services issued a categorical waiver that lets hospitals use alternative energy sources for backup power, rather than diesel generators.