Thursday, November 19, 2009

Nonprofit Health Care Developments: Senate Bill and an Updated CRS Report

Late yesterday the Senate leadership released its version of the health care bill.  While I cannot claim to have read all 2,074 pages, quick searches revealed two provisions of particular relevance to nonprofits:

  • Nonprofit Health Insurance Coops:  Section 1322 of the bill provides a number of provisions to support the creation of a "Consumer Operated and Oriented Plan" (CO-OP) program, with the stated purpose "to foster the creation of qualified nonprofit health insurance issuers to offer qualified health plans to the individual and small group markets in the States in which the issuers are licensed to offer such plans."  The federal government would provide grants and loans to support such nonprofit entities, and such entities would be tax exempt under new Internal Revenue Code section 501(c)(29) if they met various requirements.
  • Nonprofit Hospitals:  Section 9007 of the bill incorporates the additional requirements for Code section 501(c)(3) hospitals that were also in the Senate Finance Committee approved version of the bill.  These requirements include (1) conducting a community health needs assessment at least once every three years and adopting an implementation strategy to meet those needs, (2) establishing and publicizing a financial assistance policy relating to free or discounted care, and (3) satisfying certain limitations on charges and billing and collection requirements.  The Treasury Department would be required to review at least once every three years the community benefit activities of such hospitals and to report annually to Congress regarding the levels of charity care and related items for all hospitals (not only tax-exempt ones).

Probably not coincidentally, the Congressional Research Service last week released an updated report on 501(c)(3) Hospitals and the Community Benefit Standard (Tax Analysts; subscription required).  The report is an update of a July 2008 report on the same subject. 

(Side Note:  For anyone else who is annoyed by the fact that CRS reports are not readily available to the public, see this helpful summary of the so far unsuccessful battle to force CRS to release such reports directly to the public and where such reports can usually be found.  Hattip: Sarah Lawsky.)


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