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Grassley wants charity care standards in stimulus

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Chuck Grassley

Working with another member of the Senate Finance Committee, perennial not-for-profit hospital critic Sen. Chuck Grassley (R-IA) is offering two amendments to the massive stimulus bill that should increase federal scrutiny of their level of charity care.

Grassley, along with Sen. Jeff Bingaman (D-NM), has proposed that the IRS, CMS and Medicare Payment Advisory Commission work jointly to develop standard definitions of "uncompensated care" and "charity care." He and Sen. Bingaman also want to force the IRS to do an in-depth study of for-profit hospitals to see how much charity care they provide.

Regardless of whether these amendments succeed, observers still expect Grassley to introduce a measure that will set a specific minimum level of community benefit that not-for-profit hospitals must provide to keep their tax exemption. As of 2006, not-for-profit hospitals devoted only 0.6 percent more of their total operating expenses to uncompensated care than investor-owned peers.

To learn more about these proposals:
- read this Modern Healthcare article (reg. req.)

Related Articles:
Grassley investigates hospital with ties to Obamas
Non-profit hospital tax breaks attacked by Grassley, again
Senator may seek tougher charity rules for nonprofits
Senator wants non-profit hospital investigation

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Perhaps, the reason the variance between Non Profit and For Profit is so little is due to the fact that hospitals (of both types) are regulated and required to operate almost identically. With EMTALA in place, hospitals must treat patients without any regard of the patient's ability to pay, when presenting to the Emergency Room. That is where most of the uncompensated care costs for hospitals arises. So, perhaps instead of thinking non-profit hospitals do not provide enough free-care for the uninsured, we should consider that all hospitals provide the fundamental healthcare to uninsured and indigent patients without regard to for-profit/non-profit status.

I think we should consider that uncompensated care and charity care should be carved out from the other tax-exempt requirements. And focus on improving the disproportionate share program, which just received a huge enhancement from Obama.

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