Assembly Considering New Bills on Charity Care Requirements
The California Legislature is considering two bills (AB 1952; AB 503) that call for stricter guidelines over the amount of charity care not-for-profit acute care facilities must provide in order to maintain their tax-exempt status, Payers & Providers reports.
The bills are based off of a charity care bill (AB 975) that failed to advance last year (Payers & Providers, 3/20).
The stalled bill -- by Assembly members Rob Bonta (D-Oakland) and Bob Wieckowski (D-Fremont) -- would have increased the level of charity care not-for-profit acute care facilities must provide and tightened hospital reporting requirements.
Current California law requires not-for-profit hospitals to submit community needs assessments every three years to prove that the public is benefiting from the hospitals' tax-exempt status.
Hospitals opposed the legislation, while several labor unions endorsed the measure (California Healthline, 1/21).
Details of Latest Bills
Assembly member Richard Pan (D-Sacramento) introduced AB 1952, which aims to require not-for-profit hospitals to spend 5% of their revenue on charity care.
Meanwhile, Wieckowski authored AB 503, which would create uniform community benefits requirements that would target particularly vulnerable populations (Payers & Providers, 3/20).
In a release, Wieckowski said, "Taxpayers are providing these hospitals with almost $2 billion in tax benefits and yet there is no system in place with a standard method to calculate the amount of community benefits." He added that his bill would ensure that the public would "know if the hospitals' community benefit spending matches the local health care needs" (Wieckowski release, 3/4).
The California Hospital Association opposes both new measures. CHA spokesperson Jan Emerson-Shea said, "We think that the current community benefits laws work very well."
Meanwhile, California Finance Director Tom Campbell said that stricter charity care regulations could deprive the state of tens of millions of dollars in tax revenue (Payers & Providers, 3/20).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.