Nonprofit hospitals posting a profit should lose tax exempt status

The IRS allows most U.S. hospitals to pay no federal taxes under a vague “community benefit” standard, despite many taking advantage of patients with inflated bills. Some nonprofit hospitals even sue and garnish wages of low-income patients. Hospitals hide profits through accounting tricks and loan refinancing while avoiding taxes. Patients are often harassed for payment after receiving emergency care at these hospitals. For-profit hospitals provide more charity care than nonprofit ones. Momentum is growing to address this issue, with lawmakers demanding transparency and some hospitals losing tax-exempt status. The IRS’s approach to health care is criticized for penalizing direct primary care and healthy eating, instead of holding hospitals accountable for tax obligations.

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