Lawmakers push IRS to probe nonprofit hospitals

Four senators sent a letter to the IRS and the Treasury inspector general for tax administration asking them to probe nonprofit hospitals' potential abuse of their tax-exempt status.

Under IRS rules, nonprofit hospitals may qualify for tax exemptions on the basis of providing charity care and community benefits, but the senators pointed to recent reporting that said some nonprofit hospitals have been engaging in practices that are not in the best interest of their patients, according to an Aug. 9 news release from Louisiana Sen. Bill Cassidy, MD. These practices include wage garnishment, home foreclosures and the denial of medical care. 

The senators also pointed to a study of more than 1,700 nonprofit hospitals that found that 77 percent spent less on charity care and community investment than the estimated value of their tax breaks.  

"These practices — along with lax federal oversight — have allowed some nonprofit hospitals to avoid providing essential care in the community for those who need it most," the senators wrote in the letter. Dr. Cassidy sent the letter along with Massachusetts Sen. Elizabeth Warren, Iowa Sen. Chuck Grassley and Georgia Sen. Raphael Warnock.   

Read the full letter here

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