House Republicans grilled major hospital executives Tuesday on Capitol Hill, pushing for answers about $28 billion in yearly tax breaks that lawmakers say aren’t going toward patient care.
The House Ways and Means Committee called the hearing after watchdog group Consumers’ Research spent months targeting NewYork-Presbyterian and CommonSpirit Health over their spending on DEI programs, transgender treatments for children, and political causes.
Chairman Rep. Jason Smith (R-MO) didn’t mince words in his opening statement. “For-profit hospitals are legally required to put shareholders over patients, but so-called nonprofit hospitals rarely act much different,” Smith said. “Tax-exempt hospitals deliver charity care that is consistently worth less than the tax breaks that they receive. These nonprofit hospitals receive a $28 billion tax break while only spending roughly $16 billion on charity care a year. The difference fuels a spending spree totally unrelated to providing health care, like real estate investments, stadium naming rights, green energy initiatives, and political activism.”
Rep. Lloyd Smucker (R-PA) went straight at CommonSpirit Health CEO Wright Lassiter on the compensation question, asking whether his $21 million annual salary was correct. Lassiter pushed back: the number was $14 million.
“Do you think that’s on par with what a for-profit would be receiving?” Smucker asked.
Smucker then read from the company’s financials. “$718 million invested in publicly traded securities, $134 million gained by those securities?”
“Yes,” Lassiter said.
“So can you explain to me why you should be granted nonprofit status?” Smucker pressed. He didn’t get an answer. His time ran out.
Rep. Nicole Malliotakis (R-NY) said the rules for nonprofits are too vague to mean much. “Nonprofit hospitals receive a significant tax benefit, and in return, we expect them to meet certain obligations. However, those requirements are relatively broad and fall under the community benefits standard.”
Rep. Kevin Hern (R-OK) raised a practical problem with enforcement. “How can the IRS determine if an individual facility is satisfying the community benefit standard?” Hern asked.
Hospital leaders defended their community spending throughout the hearing. They didn’t directly address how much of it flows to political and ideological programs rather than patients.
After the hearing, Consumers’ Research Executive Director Will Hild put out a statement calling the situation a betrayal of the public. “Tax-exempt hospitals are betraying patients by diverting resources to woke ideological agendas while people endure long waits, surprise bills, hidden prices, and in some cases outright failures in care,” Hild said. “Nonprofit status is a privilege, not a right, and hospitals must be held accountable to refocus every dollar and every decision on delivering clear, affordable, high-quality care to the communities they are meant to serve.”
