Tax-exempt status debate puts nonprofit hospitals on notice

The tax-exempt status of nonprofit hospitals is under scrutiny as Congress determines whether the benefit equates to the value provided to local communities. The House Committee on Ways and Means has proposed the Holding Nonprofit Hospitals Accountable Act, which would amend the community benefit standard used by the IRS to determine if tax-exempt hospitals are operating for charitable purposes. The value of tax exemption for hospitals was approximately $28 billion in 2020, according to a Kaiser Family Foundation study. The proposed bill outlines new policies, including expansion of charity care eligibility and community involvement in hospital decision making.

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