Becker’s Hospital Review published an article on April 4, 2013, authored by principal W. Edward “Eddie” Phillips, titled “501(r)–What Does it Mean for You?” The piece discusses the proposed regulations by the Internal Revenue Service on tax-exempt hospitals under the Patient Protections and Affordable Care Act. The regulations on financial assistance and emergency medical care policies added new requirements that hospital organizations must satisfy in order to be described in section 501(c)(3), as well as new reporting and excise taxes.
Phillips goes on to explain that Section 501(r) imposes new requirements on 501(c)(3) organizations that operate one or more facilities, which are determined by state or local licensing requirements, and governmental hospitals that have applied for 501(c)(3) status. Each hospital is required to meet several requirements on a facility-by-facility basis. The strict requirements will need to be monitored across the hospital organization in conjunction with regulatory compliance, operations and billing entities.
While criticism of tax exempt healthcare organizations continues to grow, it remains important for hospital executives to guarantee the organization’s internal auditors and compliance officers are regularly evaluating that the implementation of FAP and EMCP and are in compliance with current rules and regulations.