The American Hospital Association is calling on the Internal Revenue Service to update private-use rules for healthcare facilities financed with tax-exempt bonds, according to an AHA News Now report.
Hospitals and physician arrangements are running into hurdles with accountable care organizations, bundled payments and other financial quality incentives because of a blending of private business and non-profit and governmental hospitals.
In a letter to the IRS, AHA "respectfully requests that the IRS consider amending Rev. Proc. 97-13 to clarify that a 501(c)(3) borrower or governmental issuer under a tax-exempt bond financing will not be considered to have private business use of its bond financed facilities as a result of its participation in an ACO under the MSSP." AHA also asks the IRS to include other accountable care organizations not involved with MSSP in this exception.
The AHA also asks for flexibility in the tax code as it applies to non-profit and governmental hospitals using bundled payments. Additionally, it asks for flexibility from the IRS when it comes to quality measures and private business use.
"Quality based incentives should not raise the same level of concern regarding private business use as financial based incentives, but can be an important tool for hospitals to encourage the highest level of performance from their providers," AHA writes in its letter.
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Hospitals and physician arrangements are running into hurdles with accountable care organizations, bundled payments and other financial quality incentives because of a blending of private business and non-profit and governmental hospitals.
In a letter to the IRS, AHA "respectfully requests that the IRS consider amending Rev. Proc. 97-13 to clarify that a 501(c)(3) borrower or governmental issuer under a tax-exempt bond financing will not be considered to have private business use of its bond financed facilities as a result of its participation in an ACO under the MSSP." AHA also asks the IRS to include other accountable care organizations not involved with MSSP in this exception.
The AHA also asks for flexibility in the tax code as it applies to non-profit and governmental hospitals using bundled payments. Additionally, it asks for flexibility from the IRS when it comes to quality measures and private business use.
"Quality based incentives should not raise the same level of concern regarding private business use as financial based incentives, but can be an important tool for hospitals to encourage the highest level of performance from their providers," AHA writes in its letter.
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