Project Summary: Making Not For Profit Hospitals Do Good Many people have criticized not-for-profit hospitals for not earning their charitable exemptions. In 2010, the Illinois Supreme Court concluded that Provena Covenant hospital, located in Urbana, Illinois, was not a charitable institution for property tax purposes. The courts opinion reasoned that the primary use of the hospital property was to provide medical services for a fee, while charity means providing a gift to the community. The opinion further pointed out that 1) the charity care being provided was subsidized by payments from other patients; 2) many patients granted partial charity care still paid enough to cover costs; 3) the hospitals community benefit activities, such as a residency program and an education program for emergency responders, also benefited the hospital and thus were not truly gifts to the community. Therefore, the hospital property was not in charitable use. Most not-for-profit hospitals today are, of course, primarily supported by payments for services rather than by charitable contributions. Under the opinions reasoning, the property tax exemption may be hard to maintain. However, a partial dissent by two justices suggest that this case in not the end of the issue. The dissent argues that the plurality opinion impinges on the legislative function of setting specific standards for tax exemption, and the issue should be settled by legislative action rather than by courts. What do you think? Should not-for-profit hospitals lose their property tax or income tax exemptions if they do not provide sufficient charity care? Should legislatures set standards that hospitals must meet to maintain their tax-exempt status? If so, how might such standards be specified?