scholarly journals Tax Exemptions for Nonprofit Hospitals: Toward Transparency and Accountability

2011 ◽  
Vol 2 (1) ◽  
Author(s):  
Tammy R. Waymire ◽  
Douglas J. Christensen
Keyword(s):  
Low Income ◽  
Financial Statements ◽  
Income Taxes ◽  
Charity Care ◽  
Nonprofit Hospitals ◽  
The Public ◽  
For Profit ◽  
Community Benefits ◽  
Tax Exemptions ◽  
Urban Hospitals

Whether nonprofit hospitals fulfill their implicit obligation to provide benefits to the public that are commensurate with the benefits associated with their tax exemptions is an important policy question. To contribute to this discussion, we examine the variation in charity care provided, scaled by net patient revenues and by imputed federal income taxes, in a sample of nonprofit hospitals that are subject to Single Audit requirements. We find that small hospitals tend to provide more charity care than large hospitals, and that rural hospitals tend to provide more charity care than urban hospitals. Interestingly enough, we find little difference in charity care amounts provided by hospitals in high income areas v. low income areas, suggesting that demand for charity care, at least in this setting, has little effect on hospital behavior regarding the provision of charity care. As a result of our analyses, we make recommendations for increased availability of hospital financial statements, as well as specific disclosures of other components of community benefits, which represent the applicable standard for evaluating tax exemptions. These recommended disclosures and increased transparency would permit more meaningful policy analysis regarding nonprofit hospitals as well as a comparison to for-profit and governmental hospitals.

Measuring Community Benefits Provided By For-Profit And Nonprofit Hospitals

2000 ◽  
Vol 19 (6) ◽  
pp. 168-177 ◽  
Author(s):  
Sean Nicholson ◽  
Mark V. Pauly ◽  
Lawton R. Burns ◽  
Agnieshka Baumritter ◽  
David A. Asch
Keyword(s):  
Nonprofit Hospitals ◽  
For Profit ◽  
Community Benefits

scholarly journals Public sector entities in the financial statements relative analysis: theoretical and practical aspects

2019 ◽  
pp. 64-78
Author(s):  
Jovita Jusytė ◽  
Irma Kamarauskienė
Keyword(s):  
Public Sector ◽  
Financial Literacy ◽  
Accounting Information ◽  
Financial Statements ◽  
National Language ◽  
The European Union ◽  
The Public ◽  
For Profit ◽  
National Economic ◽  
Relative Analysis

In the current stage of economic globalisation and development public sector finances is a factor that to a large extent influences the national economic development. There is an express need on the part of users of financial information not only to understand the accounting information pertaining to public sector entities (hereinafter – PSE), but also to be able to compare the data of the different entities within the sector, compare and evaluate reports on financial standing of PSEs of different countries. There emerged a tangible need to standardise the accounting information or the data on the used budget appropriations irrespective of the user's national language, or his education, or any other subjective factors – it became important to ensure that the principal information is understandable irrespective of the national language, financial literacy or other subjective factors of the user of the information. The accounting reform than launched and still in progress is only part of the comprehensive reform of accounting in the public sector that is currently under implementation both in the European Union, Economic Community, as well as other economically developed States. The article aims to explore the possibility of public-sector entities in the financial statements prepared on an accrual basis of data analysis for profit-making enterprises of the financial statements used in the analysis of relative performance. The presented theoretical and practical aspects and proposed new indicators, announced study carried out.

State-Level Community Benefit Regulation and Nonprofit Hospitals' Provision of Community Benefits

2018 ◽  
Vol 43 (2) ◽  
pp. 229-269 ◽  
Author(s):  
Simone R. Singh ◽  
Gary J. Young ◽  
Lacey Loomer ◽  
Kristin Madison
Keyword(s):  
Community Health ◽  
State Level ◽  
Health Needs ◽  
Charity Care ◽  
Nonprofit Hospitals ◽  
Community Benefit ◽  
Minimum Income ◽  
Needs Assessments ◽  
Community Benefits ◽  
Eligibility Standards

Abstract Do nonprofit hospitals provide enough community benefits to justify their tax exemptions? States have sought to enhance nonprofit hospitals' accountability and oversight through regulation, including requirements to report community benefits, conduct community health needs assessments, provide minimum levels of community benefits, and adhere to minimum income eligibility standards for charity care. However, little research has assessed these regulations' impact on community benefits. Using 2009–11 Internal Revenue Service data on community benefit spending for more than eighteen hundred hospitals and the Hilltop Institute's data on community benefit regulation, we investigated the relationship between these four types of regulation and the level and types of hospital-provided community benefits. Our multivariate regression analyses showed that only community health needs assessments were consistently associated with greater community benefit spending. The results for reporting and minimum spending requirements were mixed, while minimum income eligibility standards for charity care were unrelated to community benefit spending. State adoption of multiple types of regulation was consistently associated with higher levels of hospital-provided community benefits, possibly because regulatory intensity conveys a strong signal to the hospital community that more spending is expected. This study can inform efforts to design regulations that will encourage hospitals to provide community benefits consistent with policy makers' goals.

scholarly journals A multilevel mixed-effects regression analysis of the association between hospital, community and state regulatory factors, and family income eligibility limits for free and discounted care among U.S. not-for-profit, 501(c)(3), hospitals, 2010 to 2017

2021 ◽  
Vol 21 (1) ◽  
Author(s):  
Jason N. Mose
Keyword(s):  
Low Income ◽  
Family Income ◽  
Safety Net ◽  
Mixed Effects ◽  
Poverty Level ◽  
Community Factors ◽  
Regulatory Factors ◽  
For Profit ◽  
Community Benefits ◽  
Not For Profit

Abstract Background Not-for-profit hospitals are facing an uncertain financial future, especially following the COVID-19 pandemic. Nevertheless, they are legally obligated to provide free and discounted health care services to communities. This study investigates the hospital, community, and state regulatory factors and whether these factors are associated with family income eligibility levels for free and discounted care. Methods Data were sourced from Internal Revenue Service Form 990, several data files from the Centers for Medicare and Medicaid, demographic and community factors from the Census Bureau, supplemental files from The Hilltop Institute, Community Benefit Insight, and Kaiser Family Foundation. The study employs multilevel mixed-effects linear and ordered logit regressions to estimate the association between the hospital, community, state policies, and the hospital’s family income eligibility limit for free and discounted care. Results A plurality of hospitals (49.96%) offered a medium level of family income eligibility limit (160–200% of the federal poverty level (FPL)) for free care. In comparison, about 53% (52.94%) offered a low level (0–300 of FPL) eligibility limit for discounted care. Holding all else equal, hospitals designated as critical access, safety net, those in rural areas or located in disadvantaged areas were associated with an increased probability of offering low eligibility limits for free and discounted care. Hospitals in a joint venture, located in highly concentrated markets or states with minimum community benefits requirements, were associated with an increased probability of offering high eligibility limits. Conclusion State and community factors appear to be associated with the eligibility level for free and discounted care. Hospitals serving low-income or rural communities seem to offer the least relief. The federal and state policymakers might need to consider relief to these hospitals with a requirement for them to provide a specific set of minimum community benefits.

scholarly journals Strategic reporting by nonprofit hospitals: an examination of bad debt and charity care

2021 ◽  
Author(s):  
Amanda Beck ◽  
Collin Gilstrap ◽  
Jordan Rippy ◽  
Brian Vansant
Keyword(s):  
Cost Of Debt ◽  
Charity Care ◽  
Nonprofit Hospitals ◽  
Social Good ◽  
Hospital Managers ◽  
Community Benefits ◽  
Stakeholder Pressure ◽  
Tax Exempt ◽  
Using Data ◽  
Bad Debt

AbstractIn this paper, we examine bad debt and charity care reporting by nonprofit hospitals around bond issuance. Given the tax advantages afforded to nonprofit hospitals, including the ability to issue tax-exempt debt, hospital managers encounter stakeholder pressure to provide community benefits. When nonprofits issue debt, they also face economic pressure to meet creditors’ financial performance expectations. We document a reporting strategy that allows nonprofit hospitals to reduce the cost of bond debt while simultaneously alleviating regulators’ and community members’ concerns about inadequate provision of charity care. Using data from public bond issues for California nonprofit hospitals, we find that hospital managers shift costs from bad debt expense to charity care in periods prior to a public bond issuance and that the strategy is associated with a lower cost of debt. Our results inform those relying on accounting measurements to infer nonprofit hospitals’ social good provisions and financial health.

scholarly journals Sector bias in public programs: US nonprofit hospitals

2020 ◽  
Vol 3 (1) ◽  
Author(s):  
Kenneth J. Meier ◽  
Seung-ho An
Keyword(s):  
Nonprofit Organizations ◽  
Performance Management ◽  
Management Systems ◽  
Nonprofit Hospitals ◽  
Public Programs ◽  
Student Sample ◽  
Performance Management Systems ◽  
The Public ◽  
For Profit ◽  
Sectoral Differences

This study investigates whether the public perceives nonprofit organizations as different from private for-profit and public organizations and whether introducing new performance management systems would provide positive credits to the organization. Using two randomized survey experiments on US hospitals (one with an adult sample and the other with a student sample), we replicate the study of Hvidman & Andersen (2016) in Denmark with an extension of adding a nonprofit organization cue. The results show no sectoral differences among the hospitals and no positive feedback for adopting a new performance management system.

scholarly journals Not-for-profit hospitals’ provision of community benefit during the 2008 recession: An analysis of hospitals in Maryland

2013 ◽  
Vol 3 (3) ◽  
pp. 7
Author(s):  
Simone Rauscher Singh
Keyword(s):  
Burden Of Illness ◽  
Panel Regression ◽  
Charity Care ◽  
Community Benefit ◽  
For Profit ◽  
Community Benefits ◽  
Not For Profit ◽  
Difficult Time ◽  
Using Data ◽  
Charitable Activities

During the 2008 recession, many U.S. hospitals had to lay off staff and cut services to reduce costs, yet little is known about how these cuts affected hospitals’ provision of community benefits. While the need for charitable programs and services grew during this economically difficult time, financial pressures may have forced hospitals to cut back on their community benefit spending. Using data for not-for-profit hospitals in the state of Maryland for the years 2006 to 2010, this study explored whether, and if so how, hospitals changed their provision of community benefit during the 2008 recession. The findings showed that, on average, Maryland hospitals increased their charitable activities during the recent recession. Between 2006 and 2010, total spending on community benefits grew from an average of 5.6% to 7.7% of operating expenses with the most substantial growth in hospitals’ provision of charity care and mission-driven health services. Panel regression analysis showed that this increase in charitable activity was associated with increases in community need. Hospitals’ financial performance, on the other hand, was unrelated to their community benefit spending. These findings indicate that even in times of constrained budgets, Maryland hospitals provided substantial amounts of community benefit in response to the needs of the communities they serve. Hospital-based community benefit programs thus have the potential to play an important role in on-going community-wide efforts aimed at reducing the burden of illness and improving population health.  

Hospitals: N.Y. Appellate Court Denies Move to Privatize Public Hospital

1999 ◽  
Vol 27 (2) ◽  
pp. 202-203
Author(s):  
Robert Chatham
Keyword(s):  
New York ◽  
New York City ◽  
York City ◽  
Public Health System ◽  
Municipal Hospital ◽  
The Public ◽  
Public Benefit ◽  
For Profit ◽  
Benefit Corporation ◽  
The City

The Court of Appeals of New York held, in Council of the City of New York u. Giuliani, slip op. 02634, 1999 WL 179257 (N.Y. Mar. 30, 1999), that New York City may not privatize a public city hospital without state statutory authorization. The court found invalid a sublease of a municipal hospital operated by a public benefit corporation to a private, for-profit entity. The court reasoned that the controlling statute prescribed the operation of a municipal hospital as a government function that must be fulfilled by the public benefit corporation as long as it exists, and nothing short of legislative action could put an end to the corporation's existence.In 1969, the New York State legislature enacted the Health and Hospitals Corporation Act (HHCA), establishing the New York City Health and Hospitals Corporation (HHC) as an attempt to improve the New York City public health system. Thirty years later, on a renewed perception that the public health system was once again lacking, the city administration approved a sublease of Coney Island Hospital from HHC to PHS New York, Inc. (PHS), a private, for-profit entity.

The Reporting Entity in Private-Public Accounting Harmonisation. Is Control Enough for the Local Government Consolidated Financial Statements?

2017 ◽  
pp. 5-29 ◽  
Author(s):  
Cristian Carini ◽  
Laura Rocca ◽  
Claudio Teodori ◽  
Monica Veneziani
Keyword(s):  
Public Sector ◽  
Local Government ◽  
Accounting Standards ◽  
Financial Statements ◽  
Consolidated Financial Statements ◽  
The Public ◽  
Financial Accountability ◽  
Public Sector Accounting ◽  
Definition Of ◽  
Reporting Entity

The European Commission initiated a discussion on the expediency of using the International Public Sector Accounting Standards (IPSAS), based on the IAS/IFRS, as a common base for harmonizing the public sector accounting systems of the member states. However, literature suggests that accounting is not neutral with respect to the economic, social and political dimensions. In the perspective of evolution of the accounting regulation outlined, balanced between accountability, with the need to represent phenomena for reporting pur-poses, and decisionmaking issues, which concentrates on the quantitative importance of the values, the paper aims to analyse the effects of the application of different criteria for the definition of the reporting entity of the local government consolidated financial statements (CFS). The Italian PCA 4/4, the test of control and the financial accountability approaches are examined. The evidence that emerged from the case studies examined identifies several criticalities in the Italian PCA 4/4 and support the thesis that the financial accountability approach is more effective in providing a complete representation of the public resources entrusted to and managed by the group, whereas the control approach better approximates quantification of the group results in terms of central government surveillance. The analysis highlights the importance of the post implementation review period and the opportunity to contextualize the adoption of the consolidated financial statement in the broader spectrum of the accounting harmonization process, participating in the process of definition of the European Public Sector Accounting Standards (EPSAS).

Sign in / Sign up

Export Citation Format

Share Document