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Hospital Costs

August 7, 2023

More States are scrutinizing hospitals’ costs than ever before.

As of late, States have had more than a “passing” interest in better understanding where hospital dollars are being spent on community benefits.

Understanding how much and where those expenditures are targeted has become “Hot Button” community Issues. It’s really become a community question as to where this money is going?

When local hospitals have purchased by larger “Healthcare Holding” companies, virtually all of the hospitals purchased were converted to a tax-exempt, non-­profit entities. 

The takeover of local hospitals by Health Holding companies where they no longer have to pay federal and state taxes has become endemic. When local hospitals are purchased by larger corporations they immediately change the tax structure which suggests they no longer have to pay local property taxes. The end result is this action takes away money from already underfunded School Districts who have to scramble for other sources of funding.

Under these circumstances public school superintendents have complained that “We have less curriculum, less coaches, less transportation for our school systems”.

More than a dozen states have considered or passed legislation to better define Charity Care and to increase transparency about the benefits hospitals provide. In some cases States have set minimum fi­nancial thresholds for Charitable Help to their communities.

The growing interest in how tax-exempt hospitals operate – from lawmakers, the public, and the media has coincided with a stubborn increase in consumers’ medical debt. Recent health news is reporting that more than 100 million Americans are saddled with medical bills they can’t pay. There is further documentation in the news that aggressive bill-collection prac­tices by Hospital Holding Companies are using aggressive bill collection prac­tices in many of their nonprofits.