A tax break for for-profit hospitals, aimed at saving the state's Medicaid program, will cost Illinois $10 million a year in lost revenue, according to a Peoria Journal-Star report.
According to the report, for-profit hospitals will offset their Illinois income tax by the amount of their local property tax, or amount of charity care provided, whichever is less. If the number is more than the hospital's income tax liability, it can sell its tax credit to other businesses.
Illinois governor Pat Quinn said he hoped the bill would result in more charity care, according to the report. Some state officials are confused about the timing of the tax break, which comes at a time when Illinois is in a financial crisis. "[Illinois] can't afford to be giving away tax revenue at all," Ralph Martire, executive director of the bipartisan Center for Tax and Budget Accountability, said in the report.
There are 28 investor-owned hospitals in Illinois and most are owned by national health systems, such as Vanguard Health Systems in Nashville, Tenn. Vanguard will save about $5.5 million a year because of the tax break, according to the report.
IRS to Hold Hearing on Proposed Tax-Exempt Regulations for Hospitals
Prepping for the Fiscal 2013 Wave: Q&A With Greg Damron, CFO of Georgia Health Sciences Medical Center
According to the report, for-profit hospitals will offset their Illinois income tax by the amount of their local property tax, or amount of charity care provided, whichever is less. If the number is more than the hospital's income tax liability, it can sell its tax credit to other businesses.
Illinois governor Pat Quinn said he hoped the bill would result in more charity care, according to the report. Some state officials are confused about the timing of the tax break, which comes at a time when Illinois is in a financial crisis. "[Illinois] can't afford to be giving away tax revenue at all," Ralph Martire, executive director of the bipartisan Center for Tax and Budget Accountability, said in the report.
There are 28 investor-owned hospitals in Illinois and most are owned by national health systems, such as Vanguard Health Systems in Nashville, Tenn. Vanguard will save about $5.5 million a year because of the tax break, according to the report.
More Articles on Charity Care:
Medicare Stalemate: 4 Ways This Year's SGR Payment Cut Would Hurt HealthcareIRS to Hold Hearing on Proposed Tax-Exempt Regulations for Hospitals
Prepping for the Fiscal 2013 Wave: Q&A With Greg Damron, CFO of Georgia Health Sciences Medical Center