Nonprofit Hospitals Need Novel Policy Solutions for Tax Reform

Nonprofit hospitals constitute approximately 58% of all community hospitals and enjoy extensive tax breaks that often form a substantial part of their net income. Yet they often don’t reflect their tax charity status in their contributions to charity care. A fall 2023 report from the Senate Committee on Health, Education, Labor and Pensions found that many nonprofit hospitals spend far less than 1% of their revenue on charity care.

Viewed as a simple transaction between society and hospitals, society is getting a bad deal.

In a health-care system where nonprofit hospitals play a vital role in care provision, it’s concerning ...