Suffredin- For a Better Cook County  
 

Accountability
Forest Preserves
Public Safety
Cook County Budget
Forest Pres. Budget
Property Tax Appeal
Health & Hospitals
Land Bank Authority
Policy Resolutions
Unsung Heroine

 

   
 
   
   
 
   
     
  Office phone numbers:  
   
 
 

Search current and proposed Cook County Legislation in Larry's exclusive legislative library.

   
 

The Cook County Code of Ordinances are the current laws of Cook County.

   
  Cook County is the second most populous county in the nation. It is the 19th largest government in the U.S.
   
     
     
     



Illinois AG Weighs Appeal of Ruling in Provena Health Case

Tuesday, July 24, 2007
The Bond Buyer

DATELINE: CHICAGO

The Illinois attorney general's office is considering an appeal of a court
ruling last week overturning a state decision to strip a Provena Health hospital
of its property tax exemption for failing to provide sufficient charity care -
an issue that is facing heightened scrutiny from government regulators.

The ruling affects only about $1.4 million in property payments annually owed by
Provena and may not be the final word if an appeal is filed as expected, but it
is a case that is being followed by many in the not-for-profit hospital arena as
the movement to regulate charity care levels grows.

Most recently, U.S. Sen. Charles Grassley, R-Iowa, the ranking Republican on the
Senate Finance Committee, last week suggested that Congress consider setting a
minimum threshold for hospital spending on uncompensated care to warrant their
exemption from income taxes and the tax-exempt status of their bond issues.

The ruling from Sangamon County Circuit Court Judge Patrick Londrigan came late
Friday in the form of a summary judgment issued from the bench after Provena and
the state presented oral arguments in the case. The Illinois Department of
Revenue initially moved to strip Mokena-based Provena Health's Urbana hospital
Provena Covenant of its exemption from property taxes in 2004 following a
Champaign County Board of Review recommendation.

The recommendation was based on the finding that the hospital provided less than
1% of its revenues for free care to the poor and uninsured in violation of
existing state law that governs charitable organizations. An administrative law
judge sided with the hospital but the Department of Revenue rejected the judge's
ruling, leading to Provena's filing of an appeal at the circuit court level.
Provena was the first of three hospitals that state revenue officials moved to
strip of their tax-exemption.

"We believe the director of the Illinois Department of Revenue reviewed and
correctly concluded that 0.7% of net patient revenues for the poor fails to
satisfy Illinois law," said Cara Smith, a deputy in Attorney General Lisa
Madigan's office. "We are reviewing the transcripts of the hearing and
considering an appeal of the ruling."

Provena saves about $1.4 million annually because of the exemption and has been
required to pay about $5 million since it lost its exemption. Provena officials
have long argued that the system's overall contribution to the community
warranted its exempt status.

"Qualifications for a charitable exemption have nothing to do with the quantum
of free care given away by a hospital in keeping with 100 years of precedent
that recognizes charitable health care is a much broader concept," said Patrick
Coffey, an attorney at Lord Bissell and Brook, which represents Provena.

Industry experts following the case believe the ruling provides just one more
example of why a legislative resolution is needed on the issue of charity care.

"In the Provena case, they are still in the grade school level of the court
system, but the timing was amazing given the Internal Revenue Service report and
Sen. Grassley's proposal coming out just two days earlier," said James Unland,
president of the Health Capital Group. "A move by the federal government makes
the most sense because it provides a level playing field for everyone, and
frankly I think that is a better way to go."

A preliminary IRS report released last Thursday reviewed the 2003-2005 results
of 487 not-for-profit hospitals that responded to a 2006 questionnaire. It found
that 45% spend less than 3% of their revenue on uncompensated care. Figures from
the Congressional Budget Office show that not-for-profit hospitals received $12
billion in tax benefits in 2002 because of their exempt status.

The report noted the difficulty in assessing some of the material provided by
hospitals.

"The lack of consistency or uniformity in classifying and reporting
uncompensated care and various types of community benefit often makes it
difficult to assess whether a hospital is in compliance with current law," Lois
G. Lerner, director of the IRS' exempt organizations division, said in a
statement. "That's one reason more analysis is needed."

Also on Thursday, Grassley released a report floating the imposition of a
mandate that hospitals spend the greater of 5% of either operating expenses or
revenues on charity care to qualify for tax-exempt benefits.

The American Hospital Association has countered such claims that hospitals are
failing short of providing sufficient free care, saying that the same hospitals
that were part of the IRS survey provided $4.1 billion in community benefits in
addition to $5.2 billion of free charity care.

At the state level, the Sangamon County judge's ruling lends support to the
arguments of those who support pending state legislation that requires a minimum
8% of operating costs be spent on charity care. Madigan sponsored the
legislation along with new billing and collection rules early last year, but it
was put on hold as the office attempted to negotiate a compromise with the
industry.

Just the threat prompted bond insurers to halt any new coverage policies in the
state, forcing several borrowers to put deals on hold. That moratorium has since
lifted amid assurances of a compromise. A separate compromise on the billing and
collection piece was worked out and approved by the General Assembly last year.
Madigan aide Smith said the office remains in negotiations with the hospital
industry on the charity care bill.

In defense of the industry, the Illinois Hospital Association earlier this year
released a report saying that the 133 hospitals affected under the proposed
legislation would have to spend an additional $739 million on charity care under
the original legislation, an amount some financially struggling hospitals cannot
afford.

The report said not-for-profit hospitals here provided $3.7 billion in community
benefits over fiscal 2004 and fiscal 2005 including free care and other
community programs and events. Hospitals also provide an economic boost with
their expenditures valued at roughly $56 billion. The industry also spends about
$11 billion a year in salaries and benefits for 232,000 employees.

Similar reports sponsored by hospital associations have come out in other states
such as Minnesota, where Attorney General Mike Hatch has been among the critics
focusing a keener eye on the industry. Earlier this year, the Minnesota Hospital
Association released a report concluding that the state's nonprofit hospitals
provide nearly $1 billion of community benefits annually, an amount equal to a
little more than 8% of their operating expenses.



Recent Headlines

Cook County forest worker was going 76 mph in 30 mph zone, had THC in system during fatal crash while on job: prosecutors
Thursday, July 19, 2018
Chicago Tribune

Judge faces ‘tough day’ in court answering charges he brought loaded gun to work
Thursday, July 19, 2018
Chicago Sun-Times

Preckwinkle, Evans end budget battle
Wednesday, July 18, 2018
Crain's Chicago Business

How Transparent and Accountable Are Chicago, Cook County Governments?
Wednesday, July 18, 2018
WTTW Chicago Tonight

2 Cook County courthouses to close, employees spared layoffs under budget settlement: officials
Wednesday, July 18, 2018
Chicago Tribune

Troubled detainee at center of unusual court fight between Loyola hospital, Cook County
Monday, July 16, 2018
Chicago Tribune

Cook County Commissioners Confounded by Hiring of Health System Consultant
Monday, July 16, 2018
WBEZ Chicago Public Radio

Doctor fired by Cook County medical examiner now under the microscope in Indiana
Sunday, July 15, 2018
Chicago Sun-Times

County officials defend Forest Preserves police in wake of man harassing woman over Puerto Rican flag shirt
Friday, July 13, 2018
Chicago Tribune

Familiar questions about ‘bystander effect’ arise after man berates woman for Puerto Rico shirt
Friday, July 13, 2018
Chicago Tribune

Berrios' analysts used Zillow, other shortcuts in assessing property values, documents show
Friday, July 13, 2018
Chicago Tribune

Northbrook to revisit Cook County paid sick leave policy after opting out last year
Friday, July 13, 2018
Chicago Tribune

Cook County Forest Preserves officials discuss officer's resignation
Friday, July 13, 2018
Chicago Tribune

Amid video fallout, Cook County Forest Preserve District reveals fatal crash involving worker and governmental truck
Friday, July 13, 2018
Chicago Tribune

Transformation in the outdoors
Friday, July 13, 2018
Special to suffredin.org

Forest preserve cop resigns after apparently failing to help woman being harassed over Puerto Rico shirt
Thursday, July 12, 2018
Chicago Tribune

5 things: A civics lesson on Puerto Rico after man rants about woman's flag T-shirt, questions citizenship
Thursday, July 12, 2018
Chicago Tribune

Cook County Commissioners: Get Rid of Forest Preserve Police
Thursday, July 12, 2018
WTTW Chicago Tonight

Schneider wants hearing over fatal crash blamed on Cook forest preserve driver
Thursday, July 12, 2018
Daily Herald

Man who harassed woman for Puerto Rican flag shirt charged with hate crime
Thursday, July 12, 2018
WLS ABC 7 Chicago

all news items

Paid for by Larry Suffredin and not at taxpayer expense. A Haymarket Production.
^ TOP