Texas Health & Safety Code - Section 311.045. Community Benefits And Charity Care Requirements
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§ 311.045. COMMUNITY BENEFITS AND CHARITY CARE
REQUIREMENTS. (a) A nonprofit hospital or hospital system shall
annually satisfy the requirements of this subchapter and of
Sections 11.18(d)(1), 151.310(a)(2) and (e), and 171.063(a)(1),
Tax Code, to provide community benefits which include charity care
and government-sponsored indigent health care by complying with one
or more of the standards set forth in Subsection (b). The hospital
or hospital system shall file a statement with the Bureau of State
Health Data and Policy Analysis at the department and the chief
appraiser of the local appraisal district no later than the 120th
day after the hospital's or hospital system's fiscal year ends,
stating which of the standards in Subsection (b) have been
satisfied, provided, however, that the first report shall be filed
no later than the 120th day after the end of the hospital's or
hospital system's fiscal year ending during 1994. For hospitals in
a hospital system, the corporate parent may elect to satisfy the
charity care requirements of this subchapter for each of the
hospitals within the system on a consolidated basis.
(b)(1) A nonprofit hospital or hospital system may elect to
provide community benefits, which include charity care and
government-sponsored indigent health care, according to any of the
following standards:
(A) charity care and government-sponsored
indigent health care are provided at a level which is reasonable in
relation to the community needs, as determined through the
community needs assessment, the available resources of the hospital
or hospital system, and the tax-exempt benefits received by the
hospital or hospital system;
(B) charity care and government-sponsored
indigent health care are provided in an amount equal to at least 100
percent of the hospital's or hospital system's tax-exempt benefits,
excluding federal income tax; or
(C) charity care and community benefits are
provided in a combined amount equal to at least five percent of the
hospital's or hospital system's net patient revenue, provided that
charity care and government-sponsored indigent health care are
provided in an amount equal to at least four percent of net patient
revenue.
(2) For purposes of satisfying Subdivision (1)(C), a
hospital or hospital system may not change its existing fiscal year
unless the hospital or hospital system changes its ownership or
corporate structure as a result of a sale or merger.
(3) A nonprofit hospital that has been designated as a
disproportionate share hospital under the state Medicaid program in
the current fiscal year or in either of the previous two fiscal
years shall be considered to have provided a reasonable amount of
charity care and government-sponsored indigent health care and
shall be deemed in compliance with the standards in this
subsection.
(c) The providing of charity care and government-sponsored
indigent health care in accordance with Subsection (b)(1)(A) shall
be guided by the prudent business judgment of the hospital which
will ultimately determine the appropriate level of charity care and
government-sponsored indigent health care based on the community
needs, the available resources of the hospital, the tax-exempt
benefits received by the hospital, and other factors that may be
unique to the hospital, such as the hospital's volume of Medicare
and Medicaid patients. These criteria shall not be determinative
factors, but shall be guidelines contributing to the hospital's
decision, along with other factors which may be unique to the
hospital. The standards set forth in Subsections (b)(1)(B) and
(b)(1)(C) shall also not be considered determinative of the amount
of charity care and government-sponsored indigent health care that
will be considered reasonable under Subsection (b)(1)(A).
(d) For purposes of this section, a hospital that satisfies
Subsection (b)(1)(A) or (b)(3) shall be excluded in determining a
hospital system's compliance with the standards provided by
Subsection (b)(1)(B) or (b)(1)(C).
(e) In any fiscal year that a hospital or hospital system,
through unintended miscalculation, fails to meet any of the
standards in Subsection (b), the hospital or hospital system shall
not lose its tax-exempt status without the opportunity to cure the
miscalculation in the fiscal year following the fiscal year the
failure is discovered by both meeting one of the standards and
providing an additional amount of charity care and
government-sponsored indigent health care that is equal to the
shortfall from the previous fiscal year. A hospital or hospital
system may apply this provision only once every five years.
(f) A nonprofit hospital or hospital system under contract
with a local county to provide indigent health care services under
Chapter 61 may credit unreimbursed costs from direct care provided
to an eligible county resident toward meeting the nonprofit
hospital's or system's charity care and government-sponsored
indigent health care requirement.
Added by Acts 1993, 73rd Leg., ch. 360, § 4, eff. Sept. 1, 1993.
Amended by Acts 1995, 74th Leg., ch. 781, § 3, eff. Sept. 1,
1995; Acts 1997, 75th Leg., ch. 260, § 1, eff. Jan. 1, 1998;
Acts 2001, 77th Leg., ch. 654, § 1, eff. Sept. 1, 2001; Acts
2001, 77th Leg., ch. 1263, § 78, eff. Sept. 1, 2001.
Section: 311.036 311.037 311.039 311.041 311.042 311.043 311.044 311.045 311.0455 311.0456 311.046 311.0461 311.047 311.048 312.001
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Last modified: August 10, 2007
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