Crain's Chicago Business: Hospital's tax status under fire PDF Print E-mail
Crain's Chicago Business: Hospital's tax status under fire by Jeremy Mullman
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Resurrection Health Care is ineligible for tax-exempt status because its activities aren’t charitable, according to two petitions filed with the Cook County authorities that were backed by a labor union trying to organize there.

While a hospital spokeswoman said the hospital would fight to keep its status, recent his-tory suggests that Resurrection has cause for concern. In February, state authorities ruled that Provena Covenant Medical Center in Urbana-Champaign wasn’t tax exempt because of its hard-line policies toward needy patients there, including aggressive collection methods.

The result was a $1-million property tax bill for Provena, and frayed nerves at hospitals around the country. Resurrection, like most hospitals, maintains tax-exempt status because it operates as a charitable organization. In January, however, it said that it had cut charity care by at least 33%.

In a written statement, the American Federation of State, County and Municipal Employees (AFSCME) Council 31 argues Resurrection shouldn’t be exempt because it has “failed to live up to their legal responsibility to the neediest members of the communi-ty. Resurrection continues to provide inadequate amounts of charity care to the uninsured and pursue (collections-related) lawsuits against the poor.”

In a statement replying to AFSCME, Resurrection said it fulfilled its charitable commitment by providing $124.5 million in uncompensated care to patients in 2003. It also pointed to free screenings, nurse advice, and community outreach it offers to needy patients, as well as eight community clinics in the Chicago area.

If either the Cook County Assessor or the Cook County Board of Review—each of which received a AFSCME-backed petition Monday—agrees, it could prove costly for Resurrection.

AFSCME’s organizing drive at Resurrection began last year, as did a similar effort by the Service Employees International Union within the Oak Brook-based Advocate Health Care System. Both drives seem patterned after a successful unionizing effort, in early 2003, at
California’s largest hospital system, Tenet Healthcare Corp. (Chicagobusiness.com, June 27, 2003).

“We’re concerned that AFSCME is taking a ruthless approach,” says a spokesman for the Illinois Hospital Assn. “We’d hope the assessor wouldn’t allow his office to be used by a labor union for organizing.” Ressurection operates eight hospitals in the Chicago metropolitan area.

 
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