Nonprofit Hospitals Profit

Oct 10, 2022

So-called “nonprofit” hospitals are “wringing money out of patients—even those who were supposed to receive free care because of their low incomes,” according to the New York Times.

More than half the roughly 5,000 hospitals in the U.S. avoid paying business taxes because they claim to be nonprofit companies. In return, such hospitals must provide services, such as free care for low-income people, according to the tax law. Instead, one “nonprofit” hospital, Providence, instructed the employees that soliciting money “is part of your role. It’s not an option,” and required their employees to “ask every patient, every time,” with cunning questions, such as, “Would you mind paying?” or commands such as “Payment is expected.” When patients could not pay because of their low income, Providence sent debt collectors to pursue them, even though these patients had rights to free or discounted care.

Under the non-profit company tax law, Providence avoided paying 1.2 billion dollars last year in taxes on revenue of more than 27 billion dollars. The State of Washington found that Providence wrongly claimed 55,000 patients owed more than 73 million dollars.

Providence’s chief executive said in 2021, “Nonprofit health care is a misnomer. It is tax-exempt health care. [Providence] still makes profits.” He would know. This chief executive made 10 million dollars in 2020.

This profit-scheming has a devastating impact on low-income workers. Providence saddled them with bills worth thousands of dollars. Predatory schemes of these so-called “nonprofit” hospitals serve to make their wealthy owners and managers richer.