This is a very heated topic in states other than just Texas as the economy continues to whither and the balance of patients has an immediate affect on the financial status of many hospitals. How many are seeing their share of charity cases is a big question and are the tax allowances given to non profits being utilized properly. It seems to reason, the larger the non profit, the easier it is to spread the expenses over a larger amount of facilities and patient records, so in fact some of the smaller non profits may also be facing a struggle too, even with their non profit status.
In the related reading below I have a series called “Desperate Hospitals” that is a short summary of hospitals everywhere, non profit, for profit and otherwise finding it difficult to stay alive with enough funds to cover operating expenses. BD
An information crackdown may be in store for nonprofit hospitals, with the state and the IRS examining everything from the amount of free care they provide to executives’ big paychecks. The goal: to determine the true value of uncompensated care that hospitals provide.
A work group appointed by Texas legislators has devised a standard way of defining and calculating the cost of charity care — and already has drawn the ire of the hospital lobby.
While the work group’s proposal doesn’t call for nonprofit hospitals to increase charity care to justify their tax-exempt status, state Sen. Jane Nelson, R- Flower Mound, says she wants hospitals to submit audited data about the care they provide and the way state and federal indigent-care reimbursement funds are spent. That could be seen as a prelude to changes in distribution of the money.
The IRS, too, is beefing up requirements for nonprofit hospitals to report the cost of charity care they provide. The IRS is also reviewing a 1969 ruling requiring nonprofit hospitals to provide a benefit to the community. The exact nature of that benefit is loosely defined; in the eyes of some critics, there’s no standard at all.