Texas private, not-for-profit hospitals must do one the following to retain their tax-exempt status under state law:
Charity care and Medicaid shortfalls must equal 4% of its net patient revenues.
Charity care and Medicaid shortfalls must equal its tax-exempt benefits, excluding federal income tax.
Charity care and community benefits must equal 5% of its net patient revenues; charity care and Medicaid shortfalls must be 3% of the 5%. The 3% increased to 4% in 1995.
Charity care and Medicaid shortfalls must equal an amount that is "reasonable in relation to community needs."
Hospitals that receive Medicaid disproportionate share funds are exempt. Also, High Plains Baptist Hospital in Amarillo has an exemption until September 1996.