A Legal Review of Charity Care and Tax Exemption in the United States - An Analysis of Provena Medical Center v. Department of Revenue -

How can those who are impoverished, uninsured, or otherwise unable to pay for medical bills receive medical care and services from the hospital? From a patient perspective, who is eligible to receive medical care? What are the basic requirements hospitals must satisfy to receive tax exemptions from the government? What are the relevant statutes and principles for obtaining those services? These are several important questions that come to mind, and should be addressed. To answer these questions, which I will be addressing in Part II, it is necessary to know the exact meaning of charity and how hospitals have developed in the United States, because charity care is closely related to the development of hospitals. Then I will give an overview of the basic principles of the Internal Revenue Service (IRS) and its perspective on charity care, as well as briefly introduce possible policy approaches. The issue of hospital charity care in the United States is still complex and subject to debate because of the lack of a universal definition for what constitutes charity care or how much charity care hospitals should provide to justify receiving tax exemptions from federal, state, and local governments. Additionally, it is important to note that what constitutes community benefit is not clearly defined, especially because both federal and state governments set separate requirements. It will be important to clearly define what constitutes benefits through additional services so that these benefits to the community can be accurately measured and the minimum thresholds met. In Part III, I will give an examination of the community benefit standard and explain that it is flawed, as evidenced by five theories for the community benefit standard that fail to provide a compelling case for charitable exemption. However, one possible solution may involve replacing the community standard with the access theory. In Part IV, I will introduce a careful analysis of the Illinois Provena case from 2008, which provides clear implications and an example of how the Illinois Supreme Court interpreted hospital charity care based on the legal principles the court applied.