Even after the IRS granted them a reprieve this year, hospitals—concerned they could lose tax-exempt status—continue to battle with the IRS over the ways they report billing and collections to the government.
Industry presses IRS on reporting rules
The American Hospital Association, Healthcare Financial Management Association and VHA submitted a 23-page letter dated Wednesday to IRS officials with suggestions from member facilities on how to adjust—or from their perspectives how to improve—the way tax-exempt hospitals annually report information to the IRS. The Patient Protection and Affordable Care Act last year established new criteria for how hospitals could lose tax-exempt status. The new law requires disclosure of community health needs assessments.
Earlier this summer, the IRS pushed back the deadline and said hospitals did not have to adhere to the new reporting requirements for fiscal 2010. The groups are asking the requirements to be again optional in fiscal 2011, as hospital officials receive guidance on how to answer questions.
The groups outlined the same concerns in the letter that they had previously aired. Those included worries that the new criteria establish the same requirements for all hospitals, regardless of size. They requested the IRS make that part of the Form 990’s Schedule H optional until the agency can revise the question to better reflect that diversity in facilities. Officials also said the IRS has unfairly increased the burden of reporting information “that had no clear relationship to any requirement in the law or that was clearly useful to the public.” They reason that hospital officials don’t have time to dig up these records, and that some of the requests were redundant.
The AHA, the HFMA and VHA met with IRS officials earlier this year to share their concerns, and then the IRS asked the organizations to share their suggestions to improve the form. Officials from 300 hospitals provided input for the suggestions.
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