Search

As new rules have been recently published regarding the requirements facing nonprofit hospitals due to the IRS Form 990, Schedule H, many hospitals may realize that they are not always taking the best approach to community benefit through presumptive charity and misclassifying a great number of charity-eligible patients.

Charitable hospitals and health systems have the opportunity to create comprehensive, long-term strategies and procedures to help improve their communities’ healthcare needs, all the while retaining their tax-exempt status with the Internal Revenue Service.

In an effort to standardize financial transparency for nonprofit and for-profit hospitals in New Jersey, the state's Senate's Health Committee approved a bill that would require for-profits to publicly disclose the same financial information that nonprofit entities must file with the Internal Revenue Services.

In an effort to standardize financial transparency for nonprofit and for-profit hospitals in New Jersey, the state's Senate's Health Committee approved a bill that would require for-profits to publicly disclose the same financial information that nonprofit entities must file with the Internal Revenue Services.

Virginia's hospitals and health systems provided more than $2.2 billion in community support, accounted for $27.7 billion in economic activity and employed 129,000 individuals in the Commonwealth in 2010, according to a statewide report recently released by the Virginia Hospital & Healthcare Association.

While providers around the country are investing heavily in financial counseling, a large number of patients meriting financial assistance still fall through the cracks. Those being missed are declared bad-debt and sent to collections. Clearly, this is not ideal.

The American Hospital Association has urged the Internal Revenue Service to improve its new Schedule H to better reflect the benefits non-profit hospitals provide to their communities.

A new study of community benefit spending by Maryland's nonprofit hospitals, published in Health Affairs, suggests caution is needed before requiring that nonprofit healthcare providers spend a certain amount on activities to benefit their communities in order to retain their tax exemptions.

As much as 31 percent of patient revenue written off to bad debt and sent to collection agencies should be classified as charity, according to a study conducted by Connance, Inc. and PARO Decision Support, LLC.