April 19, 2007 | Read Time: 1 minute
A powerful Republican senator has asked the Government Accountability Office, Congress’s investigative arm, to examine how much free care and other services nonprofit hospitals provide to the regions in which they are located. Sen. Charles E. Grassley, of Iowa, said he is concerned that hospitals may not be providing enough services to their local areas to justify the tax breaks they receive.
Mr. Grassley, the senior Republican on the Senate Finance Committee, also said that some hospital executives and board members may be overpaid.
“There have been alarming reports about the lavish lifestyle that some of these individuals lead courtesy of the nonprofit hospital as well as the business ventures that enrich these individuals to the detriment of the nonprofit hospital,” he said.
Separately, Mr. Grassley also requested that the Congressional Budget Office review how universities use tax-exempt bonds and examine the tax-exempt status of college sports, The Chronicle of Higher Education reports.
The senator’s letter on tax-exempt bonds requests a study akin to one the research group released in December on nonprofit hospitals.
A Republican aide to the Senate Finance Committee who spoke on condition of anonymity said some members of the committee also have expressed interest in looking into other types of nonprofit organizations that use tax-exempt bonds to finance their buildings.
“Colleges and hospitals are the big users of bonds, but we are always looking at tax-exempt-bond issues across the board,” the aide said.
Mr. Grassley’s letters to the Government Accountability Office and the Congressional Budget Office are available on the Web site of the Senate Finance Committee.
