Opinion ID: 1465764
Heading Depth: 1
Heading Rank: 5

Heading: Private Paying Patients

Text: The trial court found that [s]ervices provided to private pay[ing] patients... are simply not charitable services.... Both the town and the court seem to equate the term charitable with free, and conclude that the acceptance of private paying patients renders the Center's purpose not exclusively charitable. We do not agree. The trial court's conclusion that merely charging a fee to those who have the means to pay renders the Center's purpose not exclusively charitable is not in keeping with our precedents, and is belied by the realities of the modern health care system. This court never has held that accepting payment or charging a fee, without more, alters the character of a charitable or otherwise tax-exempt organization. In Yale University v. New Haven, 71 Conn. 316, 42 A. 87 (1899), we declared what common sense requires: A church is none the less a church, because the worshippers contribute to the support of services by way of pew rent. A hospital is none the less a hospital, because the beneficiaries contribute something towards its maintenance. And a college is none the less a college, because its beneficiaries share the cost of maintenance.... Id., at 328, 42 A. 87. Likewise, a charitable, nonprofit nursing home is no less charitable simply because some patients pay for all or part of the cost of their care. The cases from our sister jurisdictions are consistent with this approach. For instance, the Ohio Supreme Court has described the situation plainly: It is the use of property rather than the fact that revenues are collected and received from property which is controlling.... Nor do reasonable charges exacted from beneficiaries of a charitable institution detract from its eleemosynary character. (Citations omitted.) Bowers v. Akron City Hospital, 16 Ohio St.2d 94, 96, 243 N.E.2d 95 (1968). Other states that have examined this issue are in accord. See, e.g., State Board of Tax Commissioners v. Methodist Home for the Aged of the Indiana Conference of the Methodist Church, Inc., 143 Ind.App. 419, 425, 241 N.E.2d 84 (1968) ([t]o qualify as a charity does not require that [the entity] have an exclusive relationship to the poor, and its charitable status is not destroyed by the charging of fees for admission and maintenance [internal quotation marks omitted]), quoting Bozeman Deaconess Foundation v. Ford, 151 Mont. 143, 148, 439 P.2d 915 (1968); Knox County Property Tax Assessment Board of Appeals v. Grandview Care, Inc., supra, 826 N.E.2d at 184 (With respect to homes or facilities that provide comfort and care to the aged ... `charitable' is not necessarily the equivalent of `free.' ... [T]he fact that residents of such facilities are charged for their stays does not necessarily negate the charitable purpose of the institution....); Nuns of the Third Order of St. Dominic v. Younkin, supra, 118 Kan. at 559, 235 P. 869 ([t]he fact that [a nonprofit hospital] charges and receives pay for patients able to pay, does not detract from the charitable nature of the services rendered); Wexford Medical Group v. Cadillac, supra, 474 Mich. at 206, 713 N.W.2d 734 ([I]f we were to accept the [city's] position that to be considered charitable, the petitioner [health care provider] could accept no fees from patients, we would be adopting the untenable position that persons who dedicate a hospital to the public must pay taxes on that hospital unless they maintain the same from their private means.... [Rather] a corporation is sufficiently charitable to entitle it to the privileges of [tax exemption] when the charges collected for services are not more than are needed for its successful maintenance. [Citation omitted; internal quotation marks omitted.]); Evangelical Lutheran Good Samaritan Society v. Gage, supra, 181 Neb. at 836, 151 N.W.2d 446 (charity includes something more than ... the relief of poverty and distress, and [courts] have given it a significance broad enough to include practical enterprises for the good of humanity operated at a moderate cost to those who receive the benefits [internal quotation marks omitted]); St. Margaret Seneca Place v. Board of Property Assessment, Appeals & Review, supra, 536 Pa. at 486, 640 A.2d 380 ([t]he requirement that an institution donate or render gratuitously a substantial portion of its services does not imply a requirement that the institution ... provide wholly gratuitous services to some of its residents). Accordingly, the Center's acceptance of private paying patients does not detract from the fact that it is organized exclusively for a charitable purpose.