Patients Need Education on Hospital Charity Care: Advocate

The Patient Advocate Foundation says non-profit hospitals need to make several operational changes on a national level to increase the awareness and use of their charity care programs, including public service announcements and encouraging social workers to get the word out.  

“Patients are often unaware of the existence of these programs and therefore do not access them,” Nancy Davenport-Ennis, chief executive of the Patient Advocate Foundation, told the Senate Finance Committee during a roundtable discussion on healthcare October 30 in Washington, D.C.  

Non-profit hospitals provide about 80 percent of the medical care in the U.S, and they receive an estimated $50 billion annually in tax breaks.  But Sen. Charles Grassley, R-Iowa, ranking member on the committee, questions whether they provide enough charity care to justify the tax benefits. Grassley is considering legislation to require non-profit hospitals to designate a minimum percentage of their revenues towards charity care to qualify for tax-exempt status.  

“The leadership of CHA (Catholic Health Association) has shown me that some hospitals can do the right thing on their own initiative,” Grassley said in opening the roundtable discussion, which included hospital industry representatives, consumer advocate groups and collection professionals. “The question is can they bring along all the non-profit hospitals to do the right thing? I am very worried that the answer may be no.” 

Davenport-Ennis told the committee that there are no national standards guiding hospitals about their charity care programs, including educating patients about their availability. She said signs should be prominently posted throughout a hospital, including every waiting area, emergency room, department and admissions center. Likewise, doctors, nurses, technicians, admissions and discharge clerks should be trained on the availability of charity care programs and be able to help patients complete applications. Non-profits also should designate a billing and collections compliance officer to oversee the program and the audit departments affiliated with patient finance.  

The non-profit organization that helps patients gain access to healthcare also recommended that non-profit hospitals:

• provide easy to understand brochures and itemized billing statements in English and Spanish;
• establish universal income guidelines for charity care programs with a recommended level of up to 250 percent to 300 percent of the federal poverty guidelines to qualify for assistance;
• evaluate income based on the previous 90 day period, not the previous tax year, and consider household size and cost of living index for a year, and;
• extend charity care program eligibility to patients based on their proximity to the facility, not exclusively on the city, county and/or state residency requirements.  

Reform of charity care programs could help not-for-profit hospitals better identify charity care patients at intake, said Rozanne Andersen, executive vice president and general counsel of the ACA International trade group. That would keep collections professionals from wasting resources.

"There’s no point in using hospital or (collection) agency resources in an attempt to collect money from people unable to pay," Andersen said.