Many nonprofit hospitals in the United States are not performing enough charitable care to justify the billions of dollars of tax breaks they receive.
Decades ago, the federal government created rules excepting non-profit hospitals from many taxes. At the time, most hospitals in the U.S. were charitable organizations, the majority of their patients unable to pay for the services they received. At that time, hospitals relied upon philanthropy—the support of religious organizations or the generosity of individual donors—to balance their budgets. They relied upon tax breaks, too.
Then after World War II, an increasing number of Americans gained health care coverage. Now, hospitals were receiving an increasing proportion of their income from paying customers. Nevertheless, neither local nor federal governments pulled back their tax breaks.
Fast forward to today: many wealthy nonprofit hospitals provide surprisingly little charitable care.
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