Charitable hospitals that treat uninsured Americans will be subjected to new levels of scrutiny of their nonprofit status and could face sizable new fines under Obamacare.<\/p>\n
A new provision in Section 501 of the Internal Revenue Code, which takes effect under Obamacare, sets new standards of review and installs new financial penalties for tax-exempt charitable hospitals, which devote a minimum amount of their expenses to treat uninsured poor people. Approximately 60 percent of American hospitals are currently nonprofit.<\/p>\n
Charity for the uninsured is one of the factors that could discourage enrollment in Obamacare, which requires all Americans to purchase heath insurance or else face new taxes themselves from the IRS.<\/p>\n
\u201cIt requires tax-exempt hospitals to do a community needs survey and file additional paperwork with the IRS every three years. This is to prove that the charitable hospital is still needed in their geographical area \u2014 \u2018needed\u2019 as defined by Obamacare and overseen by IRS bureaucrats,\u201d said John Kartch, spokesman for Americans for Tax Reform.<\/p>\n
\u201cFailure to comply, or to prove this continuing need, could result in the loss of the hospital\u2019s tax-exempt status. The hospital would then become a for-profit venture, paying income tax \u2014 hence the positive revenue score\u201d for the federal government, Kartch said. \u201cObamacare advocates turned over every rock to find as much tax money as possible.\u201d<\/p>\n
Additionally, the rise in the number of insured Americans under Obamacare will make it more difficult for tax-exempt hospitals to continue meeting required thresholds for treating the uninsured, driving more hospitals into the for-profit category and yielding more taxable money for the federal government.<\/p>\n