Last week, we talked about the new requirements in national health reform for nonprofit hospitals to provide and make public charity care as a condition of their federal tax-exempt status:

•    Having a written financial assistance policy that clearly spells out eligibility criteria and how to apply •    Taking steps to notify the public about financial assistance •    Limiting charges to patients who qualify for financial assistance •    Making a “reasonable effort” to determine whether patients qualify for charity care before engaging in extraordinary collections activity.

See Community Catalyst’s summary of hospital provisions for the entire list.

The  American Hospital Association’s position on these provisions—and the need for them—has been a moving target during the health reform debate and since.

The AHA has long maintained that voluntary standards were sufficient to make sure hospitals were doing all of the above.  Our report, Best Kept Secrets, blows a hole in that theory: as of late summer 2009, the majority of hospitals surveyed by The Access Project didn’t meet the standards that are now federal law.

But those findings didn’t fit with the story of compliance told by the AHA, which called Best Kept Secrets “out of sync with field practices and the new health reform legislation” (AHA News, May 5, 2010), and criticized reporting requirements the IRS imposed on nonprofit hospitals last year:

The concerns at the heart of [Best Kept Secrets] have been dealt with in the health care reform bill, which we supported.” – Melinda Hatton, AHA General Counsel, (Kaiser Health News, May 5, 2010)
But the AHA did not support these provisions in reform—in fact, it tried to kill them. [From a letter to Congressional leadership Jan. 7, 2010]:
The AHA does not believe that the new requirements for charitable hospitals and their ability to maintain tax exemption in the Senate bill are necessary, and we urge the conferees to remove these provisions from the final health reform conference report.
Not all hospitals worked to  squelch the charity care provisions. In fact, the Catholic Health Association and Alliance for Advancing Nonprofit Healthcare supported them (See this Modern Healthcare piece).

And despite the AHA’s very powerful opposition – and its revisionist version of history– the provisions made it into the bill.

That’s the first step. The next one is making sure they are implemented and enforced. State advocates in California and Pennsylvania, where similar laws currently exist, have found that monitoring is necessary to ensure compliance.

On the federal level, implementation means making sure the IRS puts robust requirements in place through regulation and guidance. (Read and sign-on to Community Catalyst’s letter to the IRS.)

At the state level, that involves comparing the federal law to existing state law and pushing for stronger state oversight and requirements, and/or working with hospital institutions to help bring them into compliance.

–Jessica Curtis, director, Hospital Accountability Project