H.R. 3019

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3019 Introduced in House (IH)]

<DOC>

119th CONGRESS
1st Session
H. R. 3019

To amend the Internal Revenue Code of 1986 to establish new community 
benefit standards for tax-exempt hospital organizations, and for other 
purposes.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

April 24, 2025

Mrs. Spartz introduced the following bill; which was referred to the 
Committee on Ways and Means

_______________________________________________________________________

A BILL

To amend the Internal Revenue Code of 1986 to establish new community 
benefit standards for tax-exempt hospital organizations, and for other 
purposes.

Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Holding Nonprofit Hospitals 
Accountable Act''.

SEC. 2. ADDITIONAL REQUIREMENTS FOR CERTAIN HOSPITALS.

(a) In General.--Section 501(r) of the Internal Revenue Code of 
1986 is amended--
(1) in paragraph (1), by striking ``and'' in subparagraph 
(C), by striking the period at the end of subparagraph (D) and 
inserting ``, and'', and by adding at the end the following new 
subparagraph:
``(E) meets the community benefit standard 
described in paragraph (7).'',
(2) by redesignating paragraph (7) as paragraph (8), and
(3) by inserting after paragraph (6) the following new 
paragraph:
``(7) Community benefit standard.--
``(A) In general.--A hospital organization meets 
the requirements of this paragraph if such 
organization--
``(i) has a board of directors drawn from 
the community in which such organization is 
located,
``(ii) both--
``(I) treats patients who pay their 
bills through public programs, 
including under the Medicare program 
under title XVIII of the Social 
Security Act or under the Medicaid 
program under title XIX of such Act, 
and
``(II) does not limit the number of 
such patients served at any clinical 
site owned or controlled by such 
organization, and
``(iii) spends an amount which meets or 
exceeds the expenditure threshold for the 
taxable year on any combination of--
``(I) training, education, or 
research designed to improve patient 
care,
``(II) improvements to facilities 
and equipment except as provided in 
subparagraph (C), and
``(III) free or discounted care 
pursuant to a financial assistance 
policy.
``(B) Expenditure threshold.--For purposes of this 
paragraph, the term `expenditure threshold' means 100 
percent of the value of the Federal, State, and local 
tax exemptions of the hospital organization for the 
taxable year.
``(C) Special rules for improvements to facilities 
and equipment.--
``(i) In general.--For purposes of clause 
(iii)(II) of subparagraph (A)--
``(I) expenditures under such 
clause may not be used to account for 
more than 50 percent of the minimum 
spending requirement under such 
subparagraph, and
``(II) expenditures for the 
acquisition of a physician practice, 
hospital, ambulatory surgical center, 
or any other care delivery organization 
shall not be taken into account as an 
improvement to facilities or equipment 
under such clause.
``(ii) Care delivery organization.--For 
purposes of clause (i), the term `care delivery 
organization' means an organization of people, 
institutions, and resources whose primary 
mission is to deliver health care services to 
meet the health needs of a target 
population.''.
(b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2025.

SEC. 3. HOSPITAL ORGANIZATION FINANCIAL ASSISTANCE POLICY COMPLIANCE 
REQUIREMENTS.

(a) In General.--Section 501(r) of the Internal Revenue Code of 
1986, as amended by the preceding provision of this Act, is further 
amended in paragraph (5)(A) by inserting ``according to Medicare rates 
with respect'' after ``billed''.
(b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2025.

SEC. 4. FINANCIAL ASSISTANCE POLICY REVIEW AND REPORT.

(a) Review.--The Treasury Inspector General for Tax Administration 
shall conduct a review of financial assistance policies of hospital 
organizations under section 501(r)(4) of the Internal Revenue Code of 
1986.
(b) Report.--Not later than 365 days after the date of the 
enactment of this Act and annually thereafter, the Treasury Inspector 
General for Tax Administration shall submit to the Committee on Ways 
and Means of the House of Representatives and the Committee on Finance 
of the Senate a report on the results of the review conducted under 
subsection (a), including--
(1) the content of financial assistance policies of 
hospital organizations,
(2) compliance of hospital organizations with the financial 
assistance policy requirements of section 501(r)(4) of the 
Internal Revenue Code of 1986, and
(3) such other topics as are determined by the Treasury 
Inspector General for Tax Administration to be relevant to 
financial assistance policies.

SEC. 5. INTERNAL REVENUE SERVICE ENFORCEMENT REVIEW AND REPORT.

(a) Review.--The Comptroller General of the United States shall 
conduct a review of the effectiveness of the Internal Revenue Service 
in enforcing compliance with the community benefit standard for 
hospital organizations under section 501(r)(7) of the Internal Revenue 
Code of 1986.
(b) Report.--Not later than 365 days after the date of the 
enactment of this Act and no later than every three years thereafter, 
the Comptroller General of the United States shall submit to the 
Committee on Ways and Means of the House of Representatives and the 
Committee on Finance of the Senate a report on the results of the 
review conducted under subsection (a).
<all>