[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2859 Introduced in House (IH)]
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118th CONGRESS
1st Session
H. R. 2859
To amend the Internal Revenue Code of 1986 to establish new community
benefit standards for tax-exempt hospital organizations, and for other
purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 25, 2023
Mrs. Spartz introduced the following bill; which was referred to the
Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to establish new community
benefit standards for tax-exempt hospital organizations, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Holding Nonprofit Hospitals
Accountable Act''.
SEC. 2. ADDITIONAL REQUIREMENTS FOR CERTAIN HOSPITALS.
(a) In General.--Section 501(r) of the Internal Revenue Code of
1986 is amended--
(1) in paragraph (1), by striking ``and'' in subparagraph
(C), by striking the period at the end of subparagraph (D) and
inserting ``, and'', and by adding at the end the following new
subparagraph:
``(E) meets the community benefit standard
described in paragraph (7).'',
(2) by redesignating paragraph (7) as paragraph (8), and
(3) by inserting after paragraph (6) the following new
paragraph:
``(7) Community benefit standard.--
``(A) In general.--A hospital organization meets
the requirements of this paragraph if such
organization--
``(i) has a board of directors drawn from
the community in which such organization is
located,
``(ii) both--
``(I) treats patients who pay their
bills through public programs,
including under the Medicare program
under title XVIII of the Social
Security Act or under the Medicaid
program under title XIX of such Act,
and
``(II) does not limit the number of
such patients served at any clinical
site owned or controlled by such
organization, and
``(iii) spends an amount which meets or
exceeds the expenditure threshold for the
taxable year on any combination of--
``(I) training, education, or
research designed to improve patient
care,
``(II) improvements to facilities
and equipment except as provided in
subparagraph (C), and
``(III) free or discounted care
pursuant to a financial assistance
policy.
``(B) Expenditure threshold.--For purposes of this
paragraph, the term `expenditure threshold' means 100
percent of the value of the Federal, State, and local
tax exemptions of the hospital organization for the
taxable year.
``(C) Special rules for improvements to facilities
and equipment.--
``(i) In general.--For purposes of clause
(iii)(II) of subparagraph (A)--
``(I) expenditures under such
clause may not be used to account for
more than 50 percent of the minimum
spending requirement under such
subparagraph, and
``(II) expenditures for the
acquisition of a physician practice,
hospital, ambulatory surgical center,
or any other care delivery organization
shall not be taken into account as an
improvement to facilities or equipment
under such clause.
``(ii) Care delivery organization.--For
purposes of clause (i), the term `care delivery
organization' means an organization of people,
institutions, and resources whose primary
mission is to deliver health care services to
meet the health needs of a target
population.''.
(b) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2024.
SEC. 3. HOSPITAL ORGANIZATION FINANCIAL ASSISTANCE POLICY COMPLIANCE
REQUIREMENTS.
(a) In General.--Section 501(r) of the Internal Revenue Code of
1986, as amended by the preceding provision of this Act, is further
amended in paragraph (5)(A) by inserting ``according to Medicare rates
with respect'' after ``billed''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2024.
SEC. 4. FINANCIAL ASSISTANCE POLICY REVIEW AND REPORT.
(a) Review.--The Treasury Inspector General for Tax Administration
shall conduct a review of financial assistance policies of hospital
organizations under section 501(r)(4) of the Internal Revenue Code of
1986.
(b) Report.--Not later than 365 days after the date of the
enactment of this Act and annually thereafter, the Treasury Inspector
General for Tax Administration shall submit to the Committee on Ways
and Means of the House of Representatives and the Committee on Finance
of the Senate a report on the results of the review conducted under
subsection (a), including--
(1) the content of financial assistance policies of
hospital organizations,
(2) compliance of hospital organizations with the financial
assistance policy requirements of section 501(r)(4) of the
Internal Revenue Code of 1986, and
(3) such other topics as are determined by the Treasury
Inspector General for Tax Administration to be relevant to
financial assistance policies.
SEC. 5. INTERNAL REVENUE SERVICE ENFORCEMENT REVIEW AND REPORT.
(a) Review.--The Comptroller General of the United States shall
conduct a review of the effectiveness of the Internal Revenue Service
in enforcing compliance with the community benefit standard for
hospital organizations under section 501(r)(7) of the Internal Revenue
Code of 1986.
(b) Report.--Not later than 365 days after the date of the
enactment of this Act and no later than every three years thereafter,
the Comptroller General of the United States shall submit to the
Committee on Ways and Means of the House of Representatives and the
Committee on Finance of the Senate a report on the results of the
review conducted under subsection (a).
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