Congress Mulls New Rules for Nonprofit Hospitals

Congress is putting pressure on nonprofit hospitals to propose new standards for qualifying for a tax exemption—or face new federal requirements, according to The New York Times.

In a letter to the American Hospital Association, Sen. Charles E. Grassley, an Iowa Republican, said he had “serious concerns” about the way nonprofit hospitals operate and the salaries they pay.

Mark W. Everson, the commissioner of internal revenue, told the Times that the basic standard for granting charity status to hospitals has remained virtually unchanged since 1969, yet the health-care industry has undergone major shifts.

Spencer Foreman, president of Montefiore Medican Center, in New York, called the Congressional scrutiny “appropriate,” adding that the industry should come up with a plan. But he cautioned against setting across-the-board requirements on the amount of charity care such hospitals must provide.