Apparently with nothing better to do, a group of Oregon lawmakers has decided to take on the state’s nonprofit hospitals. The hospitals, they contend, don’t behave the way good charities should, and the state should step in and correct the situation.
Their motivation may be admirable. Hospital bills can and do drive some Oregonians into bankruptcy, and if hospitals were more generous with patient charity that number might be reduced.
Nor do nonprofit hospitals make their own case particularly well. Executive salaries are published on every tax return nonprofit hospitals file, and St. Charles Health System, for example, pays Joe Sluka, its chief executive, roughly $1 million per year. Board members collectively make another $300,000 or so for attending board meetings. That makes cries of poverty sound a bit hollow in a community where median household income is about $52,400 annually.
That said, St. Charles and other nonprofit hospitals in the state do all sorts of good works in addition to hospital-bill charity. St. Charles, for example, lists donations on its 2017 tax return to Bethlehem Inn, Morningstar Relief Nursery and United Way of Deschutes County, among others.
The lawmakers behind House Bill 3076 apparently either don’t think hospitals give away enough money or, and this is more likely, they don’t think those gifts are going to the right places. Yet in St. Charles’ case and, no doubt, in the case of most Oregon hospitals, money that doesn’t go directly to patient care is spent helping agencies that can keep people out of the hospital in the first place.
Nonprofit hospitals, like other nonprofit agencies, must meet strict standards set by the Internal Revenue Service to maintain their status. They cannot get involved in politics nor spend much time on things not related to the sort of charity they are. They can’t make much income from unrelated activities, either.
That should be good enough for lawmakers, and not just where hospitals are concerned. No single charity is likely to make everyone happy, and it’s not up to the Legislature to attempt to tailor them to fulfill its own vision of what a charity should be.