A Wisconsin appeals court ruled that a Milwaukee hospital's outpatient center doesn't qualify under the hospital's property-tax exemption, finding that the clinic fundamentally operates like a doctor's office rather than an extension of the hospital.
“Left unchallenged, the court's decision, unfortunately, could reduce a hospital's ability to provide services in some communities,” the Wisconsin Hospital Association said in a written statement.
Wheaton Franciscan Healthcare-St. Joseph sued the city of Wauwatosa over $2.9 million in contested property taxes paid on the St. Joseph Outpatient Center from 2003 to 2006 and prevailed after a nine-day bench trial. The circuit court judge concluded that the variety of services offered at the clinic, including outpatient surgery and urgent care, render the facility an extension of the tax-exempt hospital.
But the appeals court, in an opinion delivered Tuesday, focuses on the absence of inpatient care, presence of office space for physicians and the fact that the bulk of patients are treated by appointment during business hours. One of three justices dissented.
“We continue to maintain that the majority of the facility is dedicated to hospital-based services as an extension of Wheaton Franciscan-St. Joseph, and we plan to appeal this decision with the Supreme Court,” according to a statement from 12-hospital Wheaton Franciscan Healthcare.
Citing a previous opinion, the appeals court notes that the evolution of healthcare delivery is making it increasingly difficult to make such distinctions.
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