New research from the state of Florida suggests hospitals are not providing enough charity care to impress regulators. Right now, legislators are considering new rules which would require charity hospitals to devote a minimum of 5 percent of revenue or expenses to provide charity care, exclusive of bad debt and write-offs for lower Medicare and Medicaid reimbursements.
According to data from the Agency for Health Care Administration, nonprofits provided $180.2 million in charity care in 2006, which adds up to 5.9 percent of expenses and 5.8 percent of revenue. However, this is not typical of many hospitals in the state, but rather a number that takes in the biggest charity performers.
Interestingly, for-profit hospitals claimed to give out a great deal more charity care--$342.8 million last year, or 10 percent of expenses and 10.2 percent of revenue. But as FierceHealthcare readers know, this could just be a classification issue, with bad debt thrown into the mix in varied ways.
To learn more about the tax-exemption issue:
- read this South Florida Business Journal piece
New York non-profit hospitals in the red. Report
IRS to investigate non-profit hospitals. Article
VHA: Charity policy must come from the top. Report
Illinois hospital must prove community benefit, or else. Report