A bipartisan bill before New Jersey legislators would require the state's 63 nonprofit hospitals to make millions of dollars in "Community Service Contributions" to local governments to offset the cost of police, fire, and other services, Healthcare Finance News reports.
The bill, introduced Monday, is an outgrowth of a June court ruling that found Morristown Medical Center in Morristown, N.J., liable for property taxes. A state Tax Court judge said the hospital, which hosts for-profit medical practices, effectively operated as a business. The center agreed in a settlement last month to shed part of its tax exemption and pay Morristown $15.5 million in back taxes, interest, and penalties.
The measure bases payments on the number of beds, with an extra levy for hospitals that operate satellite emergency facilities. Less financially viable "safety net" hospitals could apply for exemptions. State Sen. Robert Singer, a co-sponsor, said the bill is being fast-tracked for a Dec. 17 vote in hopes of enactment before Jan. 1, when local tax authorities would start assessing hospitals. "It certainly isn't the intent of the state … to cripple or put hospitals out of business [with tax bills] so what we try to do is find a compromise," he said.