Well-kept secret. Despite a lack of clearly defined standards, hospitals are under increasing pressure to publicly report charity-care figures.

Because hospitals have wildly divergent policies on reporting how much charity care they deliver, some fear the standards are so lax that they won't be able to defend their tax exemptions in court. Charity-care data are "all over the map," says Susan Sherry, left, deputy director of Community Catalyst.

Charity care: do not-for-profits influence for-profits?

This study further examines whether not-for-profit hospitals exert pressure on for-profit hospitals to provide charity care and whether for-profit hospitals react differently than not-for-profit hospitals to managed care pressures and hospital competition in providing charity care. A two equation model is estimated using 1996 data from California hospitals. The results indicate that in mixed ownership markets, for-profit hospitals provide significantly less charity care as not-for-profit hospitals in the market provide more. Unexpectedly, study for-profit hospitals were not more influenced by price competition than other hospitals with respect to charity care. Having a unique role in providing charity care may justify continuing tax exemption for not-for-profit hospitals and enhance interest in payment and other policies with regard to conversions to ensure that not-for-profit hospitals continue to be represented in market areas.

Capacity considerations and community benefit expenditures of nonprofit hospitals.

The United States Internal Revenue Service (IRS) and some states require nonprofit hospitals to demonstrate that they provide a substantial community benefit in order to get or maintain their tax-exempt status. This places every nonprofit hospital at risk. This article is about certain common factors that impact the management of all nonprofit hospitals and their ability to comply with such laws.