Hospitals and state unlikely to reach charity tax-exempt deal

Illinois hospitals and state officials don't seem close to reaching a deal to determine how much free healthcare hospitals must provide to qualify for tax breaks. If talks fall through, the Illinois Hospital Association (IHA) plans to take its own proposal for charity tax exemptions straight to the state legislature.

Gov. Pat Quinn (D-Ill.) set a March 1 deadline for the groups involved to make recommendations that would lead to legislation to clearly define what constitutes charity care, which determines whether nonprofit hospitals qualify for property tax exemptions, reported the Chicago Tribune.

IHA spokesman Danny Chun said the association has been working with the Quinn administration, the state revenue department and other groups, with all sides making "really good progress in some areas, and in others, we still have to work out the details." However, he downplayed the importance of meeting the March 1 deadline, saying the groups will "keep talking" past that date.

If all sides can't reach a resolution, state Sen. James Clayborne Jr. (D-Ill.) will sponsor the IHA's own proposal to overrule a 2010 state Supreme Court decision that narrowed nonprofit institutions' requirements for tax-exemption status. The IHA proposal would expand the definition of charity to include programs and losses that hospitals incur treating patients under Medicaid, Crain's Chicago Business reported. 

Meanwhile, Kentucky hospitals' community programs and services amounted to almost $1.67 billion in 2010, including $274 million in financial assistance and charity care, as well as contributions, such as free clinics, donations, health professions education, bad debt and the unpaid costs of Medicaid and Medicare. Those results were compiled in a Kentucky Hospital Association report, highlighting how hospitals help enhance their local economies.

To learn more:
- see the Crain's Chicago Business article
- check out the Chicago Tribune article
- read the KHA report

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