Nonprofit organizations, (1) including nonprofit hospitals, have been exempt from federal income taxation since their inception in the early 20th century, when these organizations accounted for a small portion of the U.S. economy. Nearly all hospitals were organized as nonprofit at that time, affiliated with either religious groups or foundations, and they served families who could not afford to pay a doctor to visit their home. Providing public benefits without question, these hospitals depended heavily on charitable gifts to finance their operations and earned little, if any, net income. Over the ensuing 100 years, drastic changes in medical technology have transformed hospitals from places where the poor seek primary care and comfort to places where everyone goes to get various types of care when needed. growth in the last century of private insurance and government financing of care for the elderly and poor has played a major role in stimulating the development and adoption of that medical technology, and has made it feasible for nonprofit hospitals to finance most, if not all, of their operations through patient revenues (Gentry and Penrod 1994). At the same time, however, it fueled the emergence and growth over the past 50 years of for-profit, investor-owned hospitals. Today, some nonprofit hospitals have expanded their roles further by undertaking programs to promote healthy lifestyles or otherwise prevent illness. Beginning in the mid-1950s, and extending until 1969, the Internal Revenue Service (IRS) required a hospital seeking exemption under Section 501(c) (3) to be operated to the extent of its financial ability for those unable to pay for the services rendered. In 1969, however, the IRS issued Revenue Ruling 69-545, which eliminated this charity care standard in favor of a broad standard, where promotion of health for the general benefit of the community would now be considered a charitable purpose. As part of that ruling, the IRS set forth several factors for demonstrating a community benefit: an emergency room (ER) open to all; a board of directors drawn from the community; an open medical staff policy; treatment of Medicare, Medicaid and other government program patients; use of surplus funds to improve facilities, equipment and patient care; and provision of medical training, education and research. Revenue Ruling 69 545 was requested by the hospital field itself, believing that the Medicare and Medicaid programs, in combination with employer-based private insurance coverage, would by and large eliminate the need for charity care. This ruling has now been intact for more than 40 years, with one modification made 14 years after inception. That change, Revenue Ruling 83-157, states that although the operation of an ER open to all patients is a strong indicator of community benefit, the presence of other significant factors would warrant tax exemption if a state or local planning agency determined that an ER was unnecessary and duplicative (Crossley 2007). breadth of the standard, promotion of health, continues to this day to generate considerable confusion and debate both within and outside the nonprofit hospital sector. From 1988 through the early 1990s, a national demonstration project, The Hospital Community Benefit Standards Program. was created with lending by the W.K. Kellogg Foundation. Based at the Robert F. Wagner School of Public Service at New York University and spearheaded by Robert Sigmond, National Steering Committee chairman, Anthony Kovner, project director, and Paul Haddis, project deputy director, the program developed and field-tested such standards, with the ultimate intent of having them adopted and applied by the Joint Commission on the Accreditation of Hospitals (now called the Joint Commission). These standards, process-oriented in nature, focused on community benefit governance, planning, management and reporting and emphasized hospital collaboration with other community stakeholders. …