Nonprofit hospital systems across the country are spending millions to plaster their names on sports stadiums and arenas, even as federal Medicaid cuts and economic uncertainty cloud their financial futures.

Health care systems and hospital groups have bought naming rights at ballparks and arenas in states such as California, Florida, Georgia, Indiana, New York, North Carolina, Pennsylvania and Tennessee.

The health sector’s interest in inking deals with sports teams has only grown in recent years, said Angeline Close Scheinbaum, a professor of sports marketing at Clemson University.

Scheinbaum and a colleague, Xavier University marketing professor Russell Lacey, are studying sponsorship investments in stadiums.

“One of the prominent themes we’ve been seeing in our research is a creep into the health care space,” Scheinbaum said.

But naming rights deals involving nonprofit hospitals in particular have raised eyebrows among local officials and the public.

Unlike their for-profit counterparts, nonprofit hospital systems don’t have to pay most taxes. In return, they are required to give back to the community by offering free or discounted care and by focusing their resources on underserved areas. Typically, they allocate fewer dollars to advertising and marketing.

Some local officials in states such as Tennessee and California have criticized nonprofit systems’ stadium sponsorships as a poor use of funds, arguing the money would be better spent improving or expanding access to care. Hospitals counter that they must stay competitive in the marketplace, and that sponsorships help them integrate more deeply into their communities.

But some officials remain unconvinced.

In May, the Chattanooga, Tennessee-based Erlanger hospital group announced it had inked a deal with the Chattanooga Lookouts, a minor league baseball team, to name their new stadium Erlanger Park. The Lookouts are the Double-A affiliate of the Cincinnati Reds.

That move frustrated Weston Wamp, the Republican mayor of Hamilton County, where Chattanooga is the county seat.

“When the County supported Erlanger’s transition to a nonprofit hospital, we didn’t envision multimillion dollar deals for stadium naming rights,” Wamp said in a May statement. Reached by Stateline, he declined further comment and cited his previous statement.

“I am very supportive of Erlanger Hospital and its current leadership, but at a time of severe nursing shortages and quality of care concerns, this decision is hard to explain,” he said.

While Erlanger and the Lookouts didn’t disclose the amount of the sponsorship, Wamp said the safety net hospital would be “footing the bill for the Lookouts’ $1 million annual lease payment.”

Erlanger’s president and CEO, Jim Coleman, told Stateline in a statement that the hospital is not experiencing nursing shortages.

“We are proud of our decision to become the naming rights partner of the Lookouts’ incredible new stadium because it allows our system an unparalleled opportunity to reach our community in new and exciting ways in a competitive marketplace,” he said.

“This partnership makes sense, and we look forward to welcoming our entire region to enjoy Erlanger Park next year.”

Branding a stadium or arena can improve a hospital system’s name recognition and signal its commitment to a town, Scheinbaum said. She compared it with a local physician’s office sponsoring a Little League team’s jerseys.

“It’s an economic signal of strength but it’s also a way to solidify your roots in a local community,” she told Stateline. “It becomes a permanent fixture in these cities, and part of the local lingo. In that sense, it can be very powerful.”

But as with Erlanger, not all local officials are eager to see their safety net hospitals spending millions on that kind of sponsorship, particularly when the hospitals rely heavily on state or local funding and ask for public donations.

After the nonprofit Valley Children’s Healthcare in California finalized a 10-year, $10 million contract with Fresno State for naming rights to its football stadium in 2022, the deal generated a backlash on social media. Some residents said the hospital was wasting funds, particularly after holding public fundraisers to solicit donations.

Hospital leaders defended the move, saying the money comes from its marketing budget, which is funded through hospital revenue, not donations. The hospital said the naming rights deal could improve its name recognition and ability to recruit workers.

“Valley Children’s relationship with Fresno State is a partnership, not a naming rights deal,” Zara Arboleda, Valley Children’s Healthcare spokesperson, told Stateline in a statement.

“While this partnership includes our right to name the stadium, it is primarily focused on improving health care for kids, creating educational opportunities for Valley Children’s staff and Fresno State students and building job training and education — including paid internships — for students.”

But the partnership also came with perks for the CEO and hospital officials, including a skybox suite with catering up to $1,500 for each home game, roundtrip airfare for four on the team charter plane for road games, and hundreds of tickets to home games, according to media reports.

The outcry prompted Fresno City councilmembers to ask California Democratic Attorney General Rob Bonta to investigate the hospital’s use of state funding.

In 2023, Ohio-based nonprofit health system, Bon Secours Mercy Health, paid more than $4 million to renew naming rights at a sports arena in Greenville, South Carolina. But the system has come under congressional scrutiny and earned media attention for pulling large reimbursements from a federal program meant to help subsidize care for poor patients. Critics panned the system for the money it spent on stadium naming rights and executive salaries.

In Indiana, the nonprofit Parkview Health has paid for naming rights to the local minor league baseball stadium for years, but has also attracted media attention for its hospitals being some of the most expensive in the country. Its naming rights have garnered criticism from state leaders. The stadium is home to the Fort Wayne TinCaps, the High-A affiliate of the San Diego Padres.

And in Louisiana, the Our Lady of the Lake Regional Medical Center is in talks to pay $50 million over a decade for the naming rights to a proposed new arena at Louisiana State University. The nonprofit Catholic hospital, one of the largest health care systems in the region, hasn’t yet finalized details of the deal with the state’s flagship university.

Stadium naming rights can be a good use of a health system’s marketing budget when done judiciously, Scheinbaum said.

“Sponsorship is more than just slapping your name on something,” Scheinbaum said. “It should be part of a holistic package where you’re giving back to the community.”

For example, it can allow a hospital’s providers to offer more on-site educational events during games. In recent months, Erlanger has hosted events during Lookouts games focused on women’s health and on preventing strokes.

And sports sponsorship more broadly isn’t a new phenomenon in health care. Hospitals and medical groups have long partnered with sports teams at all levels as the “official” health care providers for team athletes.

“There’s a natural organic fit between health and sports,” she said. “People love sports. It’s a cultural talking point.”

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