Nonprofit hospitals would spend more on community benefits than tax breaks

Nonprofit hospitals would spend more on their community benefits plans than their estimated tax breaks are worth. This would apply to Indiana nonprofit hospitals and their plans for serving local health needs. The comparison uses the estimated value of state and local tax breaks received during the reporting year. The rule would take effect July 1, 2026.

Hospitals would keep at least one clinical trainer in each department counted toward the requirement. At least 60% of each nonprofit hospital's departments that treat patients would need a trainer. Trainers must be licensed clinicians supervising students in accredited health programs. Hospitals could use employees, contractors, or trainers shared through regional partnerships. The requirement would take effect July 1, 2026, and apply during each reporting year.

Hospitals would report community spending by type and show how each type serves a local health priority. The provisions would cover Indiana nonprofit hospitals' annual community benefits reports and the state health department's review. Hospitals would estimate their state and local tax breaks for the reporting year. The state health department would consult tax officials, review the reports, and compare spending with those estimates. The provisions would take effect July 1, 2026.

The state health department could require a correction plan or fine a hospital for violating community benefits rules other than report filing. This would apply to nonprofit hospitals that violate community benefits rules other than the annual report filing requirement. A fine of up to $10,000 per violation could apply if a hospital fails to submit or follow a required correction plan, or keeps violating those rules. The provisions would take effect July 1, 2026.