Dive Brief:
- California legislators are debating a bill that would require nonprofit hospitals to provide charity care equal to 5% of hospital revenue each year, the Sacramento Business Journal reported.
- If the hospitals didn't meet this requirement, they would not be able to maintain their tax exempt status.
- Current California law requires that hospitals provide specific charity care plans and discount payment policies; however, there is no uniform definition in place of community benefits.
Dive Insight:
Proposals recommending a specific level of charity care required to keep nonprofit hospitals tax exempt status have bounced around the states and in Congress without resolution for a number of years. If California succeeded in enacting such a law it would set a precedent that might be picked up by other states that have also wrestled with this issue. It might even kick-start a new conversation on this topic in Congress.
Opponents of the bill criticize the legislation as being "one-size-fits-all."