From AP - News Headlines -

Provena Covenant, State Clash in IL Supreme Court over Taxes

As the national debate over health care ensues, the Illinois Supreme Court is considering a case over a Urbana hospital's tax status. The outcome, claim hospital officials, could lead to reduced medical services and higher prices.

Justices will have to decide if Provena Covenant Medical Center provided enough free or discounted care to poor patients to qualify as tax exempt. The state in 2003 determined the answer was no and forced the Catholic-run hospital to pay property taxes.

Assistant Attorney General Evan Siegel defended the state's action before the court. He says the year before, only 300 of Provena's 110 thousand admissions received charity care, not enough to deserve tax breaks.

"It doesn't matter whether an organization itself is charitable," Siegel told the high court. "What matters is whether its using the property for a charitable purpose."

But Provena's attorney, Patrick Coffey, argues the hospital qualifies because it cared for any and all patients, regardless of their ability to pay.

"It doesn't matter what amount of charity, here free care ... was given," Cofey said. "Free care was given without limit."

The court's decision has widespread ramifications statewide. If nonprofit hospitals have to pay taxes, there's speculation they would increase prices or cut back services. The high court is expected to issue an opinion in coming months.