Putting The Charity Back In Charitable Hospitals — A Bipartisan Agreement?

The new Chairman of the House Ways and Means Committee Jason Smith (R-MO) recently held a hearing on charitable hospitals. The hearing continued a long bipartisan/bicameral interest of Congress in considering the substantial tax and spending benefits charitable hospitals receive from federal/state/local government — which unfortunately far outweigh the amount of charity care that these hospitals provide to those in need. As discussed below, requiring charity hospitals to be charitable is something that should attract bipartisan interest – and could also help address concerns about spending as Congress looks at discussions on the debt and debt limit.

Chairman Smith’s statement makes it clear: “Recent studies and articles have raised concerns, however, that the level of community benefit, which includes charity care, provided by tax exempt hospitals has been inadequate compared to the value of their tax exemption. . . The level of executive compensation is particularly alarming. The top 10 nonprofit CEOs average more than $7 million annually. Some as high as $14 million. This further questions whether these facilities are living up to their mission statement.”