Comment Re:This is the Problem. (Score 1) 246
You are missing some important details that add even further to the bigger idea of what is actually going on at these organizations.
Non-Profits can often have a board and investors that benefit greatly from profits as well, but to a government this distinction is awarded based on either donations to charity or proof that money spent is going to charitable good. Healthcare systems exploit this by totaling up all of the unpaid medical care that they have given out to poor and uninsured people who happen to show up at the emergency room to receive free care. These amounts are put on the books as "charitable good" that they give to the community when the fact of the matter is they are obligated by law and ethics to not turn away people in need of immediate medical care.
So that money they would have written off as a business loss anyway on the taxes they otherwise would still have to pay on the already handsome profits they turn year after. They meet this percentage of total revenue requirement for charitable good and they retain their privileged tax free status operating in pretty much exactly the same way as a for profit corporation.
The funny thing is that with ACA greatly increasing the amount of insured people on the market it will be harder and harder for them to use these dwindling operating losses as charitable good meaning they might actually be at risk of losing their Non-Profit status unless they are able to donate substantial sums of money to charitable organizations. Donation to charity can already be written off from their taxes anyway so they actually stand to lose money and make considerably less profits by serving more insured people and giving less free healthcare from their Emergency Rooms. A funny thing is American Healthcare.