Several of California's largest health systems oppose a state bill that would define and standardize nonprofit hospitals' community benefit, according to a Sacramento Business Journal report.
Assembly Bill 503 would define community benefit and require nonprofit hospitals to complete community needs assessments and design community benefit plans. The legislation would also require hospitals to give allocate 90 percent of community benefit money to charity care and projects that improve health for underserved and vulnerable populations.
The bill was place in the Senate Appropriations suspense file Monday, which is where the Appropriations Committee sends bills when their annual cost exceeds $150,000. Suspense file bills are then considered at a hearing after the state budget has been prepared and the committee has a better sense of available revenue. The bill's supporters have said they will lobby lawmakers to pull it out of the file, according to the report.
Dozens of hospitals and health systems oppose the bill, including Sacramento-based Sutter Health, San Francisco-based Dignity Health and Oakland-based Kaiser Permanente. Jan Emerson-Shea, spokesperson for the California Hospital Association, said it is "one of our top bills to defeat," according to the report.
"It's a wasteful misuse of taxpayer money for no purpose," Ms. Emerson-Shea said in the report. "Hospitals already do a community needs assessment every three years that requires them to work with local stakeholders, develop community benefit plans and file them with the Office of Statewide Health Planning and Development."
Several unions, the California Alliance for Retired Persons and Consumer Attorneys of California support the bill, and the California Nurses Association is a sponsor. "Tax-exempt status is not a right; it's a privilege conferred on nonprofit hospitals by taxpayers," a CNA spokesperson said in the report. "The problem is there are no uniform standards — and that leaves compliance wholly up in the air."
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