Charity Care
Hospital care provided free or at reduced cost to patients who can't afford it, per the hospital's financial assistance policy.
Charity care is care a hospital provides for free (or at significantly reduced cost) under its written financial assistance policy. Most nonprofit hospitals' policies offer 100% charity to patients below 200% of the federal poverty line, with sliding-scale discounts up to 400-500% of FPL.
Federal tax law (since 2010's PPACA) requires nonprofit hospitals to:
- Publish a written financial assistance policy
- Notify patients about the policy at admission
- Limit charges to "amounts generally billed" (no listprice billing for charity-eligible patients)
- Take "reasonable efforts" to determine eligibility before pursuing collections
Charity care is reported at COST on Worksheet S-10 and as one component of community benefit on IRS Schedule H. Industry-wide, charity care averages roughly 2–3% of total operating expenses for nonprofit hospitals; the range is wide (some safety-net hospitals exceed 10%, while small/specialty hospitals may report under 1%).
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