Staff Reports
A conservative watchdog just dropped a new report accusing Texas nonprofit hospitals of taking taxpayer money and spending it like private luxury brands. Save Our States released fresh research and a YouTube ad this week saying Memorial Hermann, Mission Regional, and Barrio/CommuniCare used tax breaks and federal subsidies to fund huge executive paychecks, foreign investments, flashy art budgets, and even sports sponsorships. The group is calling on Texas lawmakers to investigate — and they should.
What the new report says about Memorial Hermann
The report pulls numbers from IRS Form 990s and paints a picture that will make most taxpayers spit out their coffee. Memorial Hermann’s CEO is listed with over $6 million in total compensation, several top executives are in the $2–3 million range, and dozens more earn seven-figure payouts. The filings also show hundreds of millions in foreign holdings and almost $2 billion reportedly directed toward art budgets at affiliated centers. Oh, and the system has been the official healthcare partner for the Houston Rockets for years — a sponsorship experts estimate at more than $1 million a year. If nonprofit hospitals are supposed to be community helpers, this reads more like a private equity brochure with a charity label.
CommuniCare, 340B, and border birth packages
The report doesn’t stop at Houston. It features CommuniCare and Barrio Comprehensive Family Health Care, whose revenue exploded from about $28.8 million in FY2013 to nearly $397.4 million in FY2024. More than 73 percent of that revenue came from the federal 340B drug-pricing program. An HRSA audit found duplicate discounts and ordered repayments — the sort of concrete enforcement that backs up the watchdog’s claims. Save Our States also flags Mission Regional for marketing discounted birth packages across the U.S.-Mexico border, alleging those offers were effectively subsidized by American taxpayers. That’s a red flag no lawmaker should ignore.
Why this matters and what should change
Tax-exempt status and federal programs like 340B are meant to help patients and the poor, not underwrite executive lifestyles, art galleries, and international investments. The new report’s fresh findings show how easily public money can drift from bedside care to prestige projects. Lawmakers in Texas should demand transparency: clear reporting of executive pay, disclosure of foreign and investment holdings, audits of 340B revenue flows, and real penalties — including loss of tax-exempt status — for organizations proven to misuse subsidies. Simple rules and tougher oversight would protect both patients and taxpayers.
The choice is plain. Texas leaders can shrug and let a few large hospital systems keep acting like luxury brands, or they can do what voters expect: hold nonprofits accountable when they behave like big business instead of community hospitals. If taxpayers keep writing the checks, they deserve to see the receipts. Lawmakers should pick a side — and soon.
