November 15, 2007 | Read Time: 2 minutes
Sen. Charles E. Grassley is using tough talk to try to persuade nonprofit hospitals to scale back their opposition to proposed changes in the Form 990 informational tax form.
Mr. Grassley, the senior Republican on the Senate Finance Committee, held a meeting last month to discuss possible new regulations for nonprofit hospitals.
During the discussion, the Iowa senator said he hopes to be able to persuade nonprofit hospitals to make changes without the need for new federal regulations.
But he said that if nonprofit hospitals continue to push for what he calls a “watered down” version of the proposed Schedule H, which would accompany the new 990 tax form, he would consider legislation that would create stringent rules for hospitals.
“While everyone talks about the need for sunshine, there are a few tax-exempt hospitals in the shadows that are bent on pulling the blinds and closing the drapes,” Mr. Grassley said. “It is disgraceful that they are misleading Congress in efforts to get the Schedule H watered down and delayed. If these hospitals continue to press for keeping the public in the dark about how they justify $50-billion in tax breaks a year, that will greatly color my views about the need for legislation.”
Mr. Grassley and his aides have been concerned that some nonprofit hospitals do not provide enough services to benefit the cities and towns in which they operate to justify their tax-exempt status. His aides this summer released a document outlining possible changes — the most stringent of which would require tax-exempt hospitals to allocate at least 5 percent of their annual revenue or expenses for charity care.
That recommendation has been criticized by representatives of nonprofit hospitals, who say they believe there will be much more information available about the financial operations of nonprofit hospitals with the adoption of Schedule H in 2009.
But many nonprofit hospital officials have been lobbying against some of the reporting requirements on Schedule H, saying that the form asks for too much information and does not provide an accurate measure of hospital finances.
