Illinois AG Turns Eye on Hospital Charity Care

http://www.insidearm.com/news/00000724-illinois-ag-turns-eye-on-hospital-charity/

The spotlight is being turned once again on the charity care contributions of non-profit hospitals.

The Lake County News-Sun in Northern Illinois reported recently that Illinois Attorney General Lisa Madigan is putting pressure on non-profit hospitals in the state to boost the amount of charity care they provide to the medically needy.

The News-Sun reported that Lake County hospitals spent a combined 1.09 percent of their total net revenue last year on charity care to the poor and uninsured. Condell Medical Center in Libertyville spent the most on charity care at 1.7 percent last year, while Lake Forest Hospital came in last at .47 percent, according to the newspaper.

The U.S. Senate Finance Committee has recommended that non-profit hospitals be required to dedicate at least 5 percent of patient revenue to charity care. Although no federal legislation in pending, the committee “continues to look at this issue and will keep all of our options open, including additional hearings and/or legislation as necessary,” said Carol Guthrie, a spokesperson for the Democratic staff of the committee.

Madigan wants to ensure that non-profit hospitals that benefit from the various tax exemptions are living up to their obligations, according to Cara Smith, a spokesperson for the attorney general. “They are required by law to deliver substantive medical care to the medically needy,” Smith said.

The Illinois Hospital Association says Madigan isn’t recognizing the full range of community benefits non-profit hospitals in Illinois provide. The benefits totaled more than $4.2 billion in 2006, said IHA spokesperson Danny Chun. He added that two-thirds of Illinois’ hospitals are losing money on patient care.

Illinois state law requires non-profits hospitals to provide charity care, but the law does not mandate how much. Neither does the Internal Revenue Service.

Some legislatures, policy makers and consumer advocate groups are questioning the wisdom of letting non-profits decide how much of their revenues they will donate to charity care, in light of the more than $12 billion in tax breaks non-profits nationwide are estimated to receive annually.

Madigan is continuing discussions with individual hospitals about their charity care contributions, Smith said.

“(Madigan) is working to ensure that hospitals that elect to operate as not-for-profit are operating in a charitable manner and providing the care to the medically needy,” Smith said.