Gov. Patrick Quinn has taken the Illinois Hospital Association's advice and asked the state's department of revenue to hold off on future rulings that would deny tax-exempt status to not-for-profit hospitals.

Quinn's request comes after the Naperville, Ill.-based IHA sent him a letter dated Aug. 22: “Nothing new would come from taxing hospitals. It will only kill jobs, further slow the Illinois economy and increase the cost of healthcare at a time when all sectors are seeking to find ways to lower healthcare costs.” Officials said that as many as 15 hospitals faced tax-exempt review before Quinn's declaration.

The IHA's letter came after the Illinois Department of Revenue denied property-tax exemptions for Prentice Women's Hospital at Northwestern Memorial Hospital in downtown Chicago, 320-bed Edward Hospital in Naperville and 334-bed Decatur (Ill.) Memorial Hospital. Hospital officials said they were confused why the department of revenue made their rulings and questioned the timing. All three hospitals said they'll challenge the rulings.

Quinn sent a letter dated Sept. 19 to IHA President Maryjane Wurth stating that the department of revenue would re-evaluate the basis for the not-for-profit hospital to retain its tax-exempt status and work with the IHA and present the findings on March 12, 2012. There won't be any final rulings on last month's decisions regarding the three hospitals before next year's deadline, the letter said.

With closer scrutiny on what denotes charitable care, hospital officials across the country are keeping a close eye on what happens in Illinois.

“The department of revenue appreciates the governor's kind words of support for the work we've done,” Illinois Department of Revenue spokeswoman Susan Hofer said. “We agree with him that it is always good to get all the stakeholders together.”

Despite the deadline, officials at Edward Hospital note Quinn made no guarantee their tax-exempt status was secure. “We appreciate the governor's willingness to seek a legislative solution and to delay action on the initial denial of our tax exemption,” Edward spokesman Keith Hartenberger wrote via e-mail. “We will work closely with the hospital community to ensure that any new legislation would reverse the initial denials by the Illinois Department of Revenue, and provide clear standards for charitable tax exemption to ensure that Edward can continue to provide the highest quality of health care to the communities we serve.”

Wurth calls Quinn's action good news and looks forward to meeting with state officials to come up with a solution that satisfies all parties. She notes a 2010 state Supreme Court decision that upheld the decision to take away tax-exempt status from Provena Covenant Medical Center in Urbana, Ill.

“This is a very complex issue, the changes in healthcare are complex,” she said. “We need to understand the nuances of the Supreme Court ruling and discuss the options as far as what the appropriate criteria is for property-tax exemptions, and that takes some time.”