Last month, we told you about the public availability this year of critical information on hospitals’ Schedule H tax forms regarding their billing, financial assistance and community benefit programs. However, three weeks ago, the IRS announced that it is weakening transparency around hospital financial assistance and community benefit programs for this year by making hospital-specific reporting on financial assistance and community benefit programs optional for the 2010 filing.
The Squeaky Wheel As we’ve described, the revamped Schedule H asks every non-profit hospital a series of simple yes or no questions about their compliance with the new ACA requirements. More than a year after the passage of the ACA, these questions should be easy to answer. In fact, let’s take a look. (For those of you with a deep love of all things taxes—and really, isn’t that most of us?—the relevant section is Part V, Section B.)
Here’s Question 13, which asks about how the hospital made the public aware of its financial assistance policy:
There is widespread agreement among advocates and many within the hospital industry that these basic steps to notify the public about financial assistance should be part of a hospital’s standard practice. The following questions build on this by asking hospitals whether their debt collection policies allow aggressive tactics to be used and, if so, what steps the hospital takes to notify patients directly about financial assistance.
Simple, right? Sadly, a number of national and state hospital associations — including the American Hospital Association and associations in California, Florida, New York, Illinois, Massachusetts, and Ohio – do not agree that individual hospitals should be required to respond to these questions. They wrote a letter to the IRS recently saying these new reporting requirements are “onerous and redundant”. They also write that the questions go beyond what the ACA requires.
We disagree on both counts. But, perhaps as a result of their complaints, these questions have been made optional for the 2010 tax year. This could be the first step down a slippery slope to strip the ACA requirements of any real power.
What Does This Mean? This change in IRS policy indicates a couple of things:
- Certain (but certainly not all) segments within the hospital industry are currently using their considerable power to actively stop the implementation of these consumer protections;
- Regulators are not considering the impact that these provisions—and a lack of transparency about them—could have on community members.
Consumers — especially vulnerable populations — will suffer because information about these programs isn’t publicly available. We have all learned, time and time again, that enforcement and oversight is key to making sure protections are real for patients. While this is a federal policy issue, the impact is going to be felt close to home—in local communities whose hospitals decide not to report this information and/or are not substantially changing their practices in accordance with the ACA.
What Can We Do? Recently, Community Catalyst sent a letter to the IRS, Treasury, and the Department of Health and Human Services outlining our disappointment with their recent announcement and calling again for strong, consumer-friendly rules and guidance for these hospital programs. We’re calling on policymakers to hold the line on transparency in the years to come—and to issue regulations that protect consumers this year.
But we can’t do this alone. The advocacy community must unite to send a strong signal to the IRS, Treasury, the public and hospitals. We need to let the IRS know that it isn’t just about too much or too little reporting and “administrative burden.” This is about families and people suffering real harm because of inadequate oversight, poor practice, and lax standards. It’s about creating healthier, more financially secure communities.
The summer is a perfect time to ask your local hospitals what they are doing to implement these portions of the ACA. And, it’s a great time to start spreading the word about the new protections to consumers and patients themselves. After all, if they don’t know what the law does for them, they won’t know what they stand to lose.
— Jessica Curtis, Project Director, Hospital Accountability Project