U.S. Finance Committee Turns Its Attention to Hospitals
(May 31, 2005) Sen. Charles Grassley (R-Iowa), Chairman of the Senate Finance Committee, requested detailed information from the nation's largest nonprofit hospitals to account for their charitable activities and validate the tax-exempt status they receive.
In a press release, Grassley noted that the inquiry is a 'continuation of his effort to review the nonprofit sector in advance of legislation he will introduce to prevent abuse of the federal tax laws that created nonprofit organizations and encourage charitable donations.'
Grassley sent a letter to 10 hospitals and hospital systems, requesting information about issues such as charitable activities, patient billing, and ventures with for-profit companies and hospitals. The following hospitals received the letter:
- The Cleveland Clinic, Cleveland;
- New York Presbyterian Hospital System, New York City;
- Advocate Health Care Network and Advocate Health and Hospitals Corporation, Oak Brook, Ill.;
- Resurrection Medical Center and Resurrection Health Care, Chicago;
- Phoebe Putney Health Systems, Inc., Phoebe Putney Memorial Hospital, Inc., Albany, Ga.;
- William Beaumont Hospital and Beaumont Properties, Royal Oak, Mich.;
- North Mississippi Health Services, Inc., North Mississippi Medical Center, Tupelo, Miss.;
- Sutter Health, Sacramento, Calif.;
- Fairview Health Systems, Minneapolis; and
- Banner Health, Phoenix, Ariz.
Grassley noted that he is still working on a series of legislative reforms to curb various other abuses and improve charities' accountability to taxpayers and potential donors. He also commented that he continues to consult with the nonprofit sector to ensure that his reforms are effective yet not unduly onerous for charities, especially small charities.
Senate Finance Committee Hearing on Land Issues
The Senate Finance Committee plans to hold a hearing on June 8 on issues related to donations of real estate property. Changes in the rules for donation of land, conservation easements and historic façade easements are among the revenue-raising provisions that the Committee may implement to offset the cost of the charitable giving incentives found in the Charity Aid, Recovery and Empowerment (CARE) Act.
As AFP has noted previously, Grassley likely will attach his reforms to the CARE Act.
Please Contact Your Members of Congress
Given Grassley's interest in nonprofit hospitals and the upcoming hearing on land issues, it seems clear that Grassley hopes to introduce a package of reforms this summer.
Before that time, Congress must hear from AFP members in the United States. Tell your Members of Congress that many of these reforms are ill-advised and that the federal government should not try to reap revenue on the backs of charities.
If you have not contacted your Members of Congress yet to voice your concerns about the proposed reforms, AFP urges you to do so now. A draft letter and contact information for your Members of Congress have been provided on the AFP website.
If you have already called and sent letters, thank you! Please recruit others - your colleagues, board members and key volunteers and donors - to do the same.
Related AFP ResourcesCharitable Reforms Face Roadblock in the House
Congressional Committee Proposes New Limits on Charitable Deductions
Will U.S. Senate Hearing on Charity Abuses Spark Additional Legislation?
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U.S. Federal Issues: February 2004 Public Policy Update