Newspaper article St Louis Post-Dispatch (MO)

Nonprofit Hospitals' Tax Breaks Irk Officials of For-Profit Groups

Newspaper article St Louis Post-Dispatch (MO)

Nonprofit Hospitals' Tax Breaks Irk Officials of For-Profit Groups

Article excerpt

Take two hospitals with the same mission: providing medical treatment to the uninsured, homeless and poor, regardless of their ability to pay.

But one hospital is not-for-profit, so it gets reduced postage, free water from the city and doesn't pay a cent in federal or state income taxes. The other one is a for-profit institution, so it pays about $30 million a year in taxes.

Nonprofit hospitals argue that tax exemptions allow them to charge less for medical care and outreach programs. But a growing number of critics are questioning whether the nonprofit hospitals are doing enough to justify their tax breaksah.

Nationally, nonprofit hospitals receive $8.5 billion a year in tax breaks, according to Tax Notes, a publication for accountants.

John Columbo, associate dean of the law school at the University of Illinois, said their argument was this: " `Trust us. We're doing good things for people and the community.'

"I say: `Show me.' . . . We need to ask ourselves why we're being so generous," he said.

Until 1969, the federal tax code required not-for-profit hospitals to treat patients who couldn't pay. Since then, the Internal Revenue Service has required only that hospitals provide some benefits, such as health education, to the community.

Seven states have approved laws requiring hospitals to specify the charitable contributions they make to a community. …

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