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.
The bill passed 9-0 with one abstention on Thursday.
Just as non-profit hospitals do, the bill would require for-profit hospitals to report their operating budget, business holdings and executive compensation, among other financial data, to the state Department of Health and Senior Services to receive charity care funding. The hospitals also must post the information to their own websites.
According to Kerry McKean-Kelly, a spokesperson for the New Jersey Hospital Association, for-profit hospitals in the state would be required to report the same information non-profit hospitals are required to report in the IRS 990 non-profit tax form, Schedule H.
For-profit hospitals receive charity care from New Jersey to cover some of the uncompensated care they provide to uninsured and low-income patients. The bill, S-782 would require for-profit hospitals to report the same information in order to receive charity care funding, said McKean-Kelly.
Given that public funds finance charity care, "we should have the right to see how that funding impacts them, and how much money the hospital is actually making," Joseph Scott, CEO of non-profit Jersey City Medical Center, told the NJ Spotlight.
New Jersey’s Department of Health and Senior Services would collect and post the information on its website, according to the bill.
McKean-Kelly said the New Jersey Hospital Association has not taken a position yet on whether it will be backing the bill or not.
“While we support the purpose of the bill to improve transparency among all hospitals, we were originally worried about the inconsistency within the bill,” she said. “The bill has since been amended so that the levels of reporting between non-profit and for-profit hospitals are the same.”
Follow HFN associate editor Kelsey Brimmer on Twitter @kbrimmerHFN.