IRS Checking On Non-Profit Hospitals

Today's New York Times reports that the Internal Revenue Service has begun an investigation of non-profit hospitals-- many of them religiously affiliated-- to determine whether they are meeting the standards for tax-exempt status. The agency has sent a compliance questionnaire to 550 hospitals asking about their operations, community services, medical research, furnishing of care for uninsured patients, pricing of services for the uninsured and executive compensation. Results could be used to decide whether the IRS should change any of its current Regulations. Before 1969, the agency specifically required hospitals to provide charity care to qualify for tax-exempt status. Now I.R.S. Regulations merely require that hospitals provide benefits to the community, which may be done in other ways as well.