Rethinking Charity For Those Declining Coverage
By Julie Appleby
Fri, Aug 15 2014
As more Americans gain insurance under the federal health law, hospitals are rethinking their charity programs, with some scaling back help for those who could have signed up for coverage but didn’t.
The move is prompted by concerns that offering free or discounted care to low-income uninsured patients might dissuade them from getting government-subsidized coverage.
If a patient is eligible to purchase subsidized coverage through the law’s online marketplaces but doesn’t sign up, should hospitals “provide charity care on the same level of generosity as they were previously?” asks Peter Cunningham, a health policy expert at Virginia Commonwealth University.
Most hospitals are still wrestling with that question, but a few have gone ahead and changed their programs, Cunningham says.
The online charity care policy at Southern New Hampshire Medical Center in Nashua, for example, now states that “applicants who refuse to purchase federally-mandated health insurance when they are eligible to do so will not be awarded charitable care.”
The same rule disqualifies aid to those who refuse to apply for expanded Medicaid, which New Hampshire lawmakers voted to extend, beginning Aug. 15.
Some Hospitals Require A Nominal Contribution
At BJC HealthCare, which has 12 hospitals in Illinois and Missouri, including Barnes Jewish Hospital in St. Louis, anyone receiving financial assistance must make some contribution to their care, for instance, $100 for emergency care. BJC does not bar financial aid to those who have refused to buy insurance through the health care law.
While all uninsured patients get a 25 percent discount off list charges, BJC gives additional discounts to those earning up to three times the federal poverty level, or about $35,000 for an individual. Formerly, those additional discounts were available for those earning up to four times the poverty level, or about $46,600.
“Patients will continue to receive needed medical care regardless of their ability to make payment at the time of service,” says spokeswoman Kim Kitson, adding the changes are likely to affect fewer than 3 percent of patients.
To be sure, hospitals have a strong financial interest in having more patients covered by insurance. That’s particularly true for hospitals that see many uninsured patients because the health law also reduces their government payments for uncompensated care. The assumption was that most uninsured people would gain coverage and no longer run up large hospital bills that could not be paid. But since the Supreme Court ruled that states could opt out of the health law’s Medicaid expansion, 24 states decided not to participate. Hospitals that treat large numbers of low-income people in those states face real financial pressures. In addition, the health law requires nonprofit hospitals to make their written charity policies widely available, although it does not specify what criteria hospitals use to determine who is eligible. The assistance programs aren’t just for the uninsured: Most hospitals also help insured patients struggling to pay deductibles or other costs associated with their care.