IRS Report on Nonprofit Hospitals

Recently, the IRS released a final report on its 2006 nonprofit hospital study, which analyzes community benefit and compensation reporting by almost 500 hospitals.  The IRS found that the average and median percentages of total revenues reported as spent on aggregate community benefit expenditures were 9% and 6%, respectively, for the overall group. AHA President and CEO Rich Umbdenstock said, “Today’s IRS report reaffirms that hospitals of all types are providing a healthy mix of care and services to the communities they serve. While the report has its limitations, it highlights how hospitals across the country are meeting their mission of caring for communities.”  The report also found that nearly all amounts of compensation reviewed were upheld as established pursuant to the rebuttable presumption process and within the range of reasonable compensation.