Feb 18, 2020 - Health

Nonprofit hospitals' charity care disparities

A hospital sign with the 'H' replaced with a dollar sign
Illustration: Lazaro Gamio/Axios

Nonprofit hospitals that did the best financially provided less charity care relative to their income than their less-well-off peers, according to a new study in JAMA.

The big picture: Nonprofit hospitals are required to provide charity care in exchange for their tax-exempt status, but they're increasingly under fire for their aggressive bill collection practices against low-income patients.

By the numbers: In 2017, nonprofit hospitals collectively generated $47.9 billion in net income and provided $14.2 billion in charity care.

  • The top-earning 25% of hospitals provided $11.50 in charity care for uninsured patients and $5.10 in charity care for the insured for every $100 of their overall net income, the study found.
  • But the third quartile of hospitals provided $72.30 in charity care for the uninsured and $40.90 in charity care for the insured for every $100 of their net income.
  • Hospitals in states that expanded Medicaid provided significantly less charity care than hospitals in other states.

What they're saying: "Nonprofit hospitals with substantial financial strength should consider more generous financial assistance eligibility criteria to reduce the financial risk exposure of disadvantaged uninsured and underinsured patients," the author concludes.

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