Advocate Christ Medical Center now offers patients copies of its financial assistance policy in three languages. But soon the Oak Lawn, Ill., hospital will offer translations in 15 more languages to better reflect the local community.
The change was driven by new, final Internal Revenue Service regulations outlining what more than 2,900 not-for-profit hospitals across the country need to do to hold on to their tax-exempt status. The mandate for change, contained in the Affordable Care Act, was driven by concerns that some not-for-profit hospitals are operating more like for-profit entities, especially in the area of bad-debt collections.
Some believe the final regulations will lead to more community engagement and collaboration between state and local health agencies and hospitals. Hospitals clearly have a lot at stake if they fail to comply with the new regulations.
“What hospitals should be concerned about is the broader message coming from the government, and particularly congressional leaders, that they're going to put charitable hospitals' feet to the fire to justify their tax exemption,” said Jim Flynn, who heads the healthcare group at Bricker & Eckler in Columbus, Ohio.
The final regulations, which go into effect Jan. 1, grew out of criticism by Iowa Republican Sen. Chuck Grassley and others that some tax-exempt hospitals were aggressively pursuing poor patients for unpaid bills while racking up huge, untaxed surpluses. Before the ACA, hospitals only had to show they were providing a “community benefit” to be tax-exempt, and the definition of “community benefit” was vague, said Sara Rosenbaum, a law professor at George Washington University.
The new regulations are far more specific, and follow proposed regulations hospitals have followed for years. They require not-for-profit hospitals to establish written financial-assistance and emergency-care policies; limit the amount they bill low-income patients for care; make reasonable efforts to find out whether an individual is eligible for financial assistance before engaging in extraordinary collection activities; and conduct a community health-needs assessment, followed by an implementation strategy at least once every three years.