A group of bipartisan senators are ramping up scrutiny on nonprofit hospitals’ charity care spending, calling for a revision of federal auditing standards over concerns that hospitals abuse their tax-exempt status to avoid providing free and discounted care to communities and low-income populations.
In a pair of letters sent to federal tax commissioners, lawmakers including Sen. Elizabeth Warren, D-Mass., and Sen. Chuck Grassley, R-Iowa, urged a review of charity care tax regulations — which exempt nonprofit hospitals from paying federal taxes in exchange for subsidized care — arguing that current government oversight is “lax” and insufficient, Healthcare Dive reports.
Current auditing standards allow nonprofit hospitals to report the scope of their charity care in an open-ended structure, preventing transparency into nonprofits’ charity care for tax exemptions that one study estimated were worth over $28 billion in 2020, according to the letters. Read more.
