Nonprofit Hospitals: Better Standards Needed for Tax Exemption
HRD-90-84
Published: May 30, 1990. Publicly Released: Jun 29, 1990.
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Highlights
Pursuant to a congressional request, GAO assessed the role of nonprofit hospitals in providing: (1) acute medical care to indigents; and (2) other community services, such as health education and screening.
Recommendations
Matter for Congressional Consideration
| Matter | Status | Comments |
|---|---|---|
| Currently, there are no requirements relating hospitals' charitable activities for the poor to tax-exempt status. If Congress wishes to encourage nonprofit hospitals to provide charity care to the poor and underserved and other community services, it should consider revising the criteria for tax exemption. Criteria for exemption could be directly linked to a certain level of: (1) care provided to Medicaid patients; (2) free care provided to the poor; or (3) efforts to improve the health status of underserved portions of the community. | H.R. 1374 and H.R. 790 were introduced to establish standards of charity care for tax-exempt hospitals. The bills are still pending. IRS has taken a more aggressive stance in monitoring tax-exempt hospitals, but the legislation GAO recommended has not been enacted. |
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Topics
Charitable organizationsDisadvantaged personsFederal taxesHealth care cost controlHealth care costsHealth care servicesHospital care servicesIndigentsNonprofit organizationsTax exempt statusMedicaid