Sen. Grassley Asks IRS For Details About Non-Profit Hospitals’ Collection Practices

Sen. Chuck Grassley [R-Iowa] has written a letter to the commissioner of the Internal Revenue Service seeking, among other things, information about the debt collection practices at non-profit hospitals nationwide.

The information is part of a broader examination into making sure that non-profit hospitals “are fulfilling the standards for serving communities and low-income patients as required by law,” according to Sen. Grassley, referring to Section 501(r) of the Internal Revenue Code.

Sen. Grassley, who is chairman of the Senate Finance Committee, has investigated the practices of non-profit hospitals before. In questioning the IRS, Sen. Grassley asked:

  • How many hospitals that the IRS reviewed engaged in debt-collection practices involving patients eligible for financial assistance policies (FAPs), as defined by [Section] 501(r)-1?
  • How many of those hospitals did the IRS find to be noncompliant when it comes to making their FAPs widely publicized?
  • How many of those hospitals did the IRS find to be engaged in extraordinary collection actions?
  • Of those noncompliant hospitals, describe how the IRS instructed them to come into compliance or otherwise sanctioned them.

“Making sure that tax-exempt hospitals abide by their community benefit standards is a very important issue for me,” Sen. Grassley wrote in his letter. “As chairman of the Senate Judiciary Committee, I oversaw an investigation into the billing practices of the Mosaic Life Care hospital. That investigation resulted in debt relief of almost $17 million for thousands of low-income patients. This issue is still just as important to me now that I am chairman of the Senate Finance Committee.”

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