IL hospital loses high-profile tax case

The Illinois Department of Revenue has moved to strip Urbana, IL-based Provena Covenant Medical Center of its tax-exempt status, contending that it neither provides enough charity care nor makes it clear that charity care is available. Provena has been under fire since at least 2003, when a Wall Street Journal piece took the hospital to task for its aggressive debt-collection practices. According to this week's WSJ article, Provena still hasn't cleaned up its act sufficiently. Brian Hamer, director of the Illinois Department of Revenue, ruled that that Provena Covenant still provides far too little charity care to justify a tax exemption. It spent roughly $800,000 of its $113 million in revenues spent on charity care in 2002, or less than 1 percent, an amount Hamer characterized as "seriously insufficient." The hospital, which is owned by Provena Health of Mokena, IL, is appealing the decision. If it loses, it could face new property tax bills of $1 million or more per year.

For more details on the Provena decision:
- read this report on the decision in The Wall Street Journal (sub. req.)
- check out this article on Provena's appeal in TheNewsGazette.com

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Nonprofit hospitals continue to face IRS scrutiny on whether they're providing enough charity care. Article

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