Hospital Financial Assistance and Charity Care

What financial assistance means at a hospital

Financial assistance, often called charity care, is a hospital program that reduces or waives what a patient owes for care. Hospitals set these programs up in different ways. Some give a full discount to patients with lower incomes, some give a partial discount, and some offer payment plans instead. Names vary too: financial aid, patient assistance, or a discount program.

These programs are separate from insurance and from the prices a hospital publishes. A published price shows what a hospital lists or negotiates, while financial assistance is a way a hospital may adjust what a particular patient is asked to pay. For more on the different price types, see our guide to cash prices and insured rates.

What nonprofit hospitals must have under IRS section 501(r)

Nonprofit, or tax-exempt, hospitals must meet requirements under IRS section 501(r). In general terms, these include:

• A written financial assistance policy that is widely publicized.
• Limits on what patients eligible for assistance are charged for emergency and other medically necessary care, generally no more than the amounts generally billed to insured patients.
• Reasonable efforts to determine eligibility before the hospital takes extraordinary collection actions.

The rule requires a policy and sets those limits, but each hospital sets its own eligibility rules. Many hospitals that are not nonprofit also offer assistance, with terms that vary. The hospital's billing office can usually say which kind of hospital it is.

Why eligibility differs from one hospital to the next

Because each hospital writes its own policy, two hospitals in the same city may treat the same patient very differently. Policies commonly differ in:

• Who can apply, such as whether insured patients are included or only uninsured patients.
• How the hospital measures need and which documents it asks for.
• How much of a bill is discounted and which services count.
• Whether the policy covers the hospital's facility bill only, or other bills too.

That last point matters. Hospitals can bill a facility fee, while physicians such as surgeons, radiologists and anesthesiologists usually bill a separate professional fee. A hospital's assistance policy may or may not apply to those separate bills, so reading the policy closely or asking the billing office can help. Our guide to facility fees and professional fees explains the difference.

How to find a hospital's financial assistance policy

A hospital that must publicize its policy often posts it on its website, commonly under billing, patient financial services, or financial assistance. Many also post a plain-language summary and an application form. Calling the billing office to ask for the policy and application by mail or email is another route.

When reading the policy, some people look for:

1. The income or other criteria used to decide eligibility.
2. The documents the hospital asks for.
3. The application period, if the policy states one.
4. Which providers and services the policy covers.
5. A contact person or department for questions.

How to apply, before care or after a bill arrives

Patients can generally ask about financial assistance at any point: before a scheduled service, during a stay, or after a bill arrives. Many people first learn about these programs when a statement comes, and asking at that stage is common.

Some people find steps like these helpful:

1. Contact the hospital's billing or financial counseling office and say you would like to apply for financial assistance.
2. Ask for the written policy, the application, and a list of required documents.
3. Ask whether the account can be placed on hold while the application is reviewed. Policies differ, so the hospital is the source for how it handles this.
4. Request an itemized bill to check the charges. Our guide to reading an itemized hospital bill walks through the line items.
5. Submit the application with the requested documents, and keep copies and notes on who you spoke with and when.
6. If an application is denied, ask for the reason in writing and whether the hospital has an appeal process.

If collection notices have already arrived, the billing office can explain how an application affects the account. The 501(r) rules call for reasonable efforts to determine eligibility before extraordinary collection actions, so nonprofit hospitals generally have some process here, though details differ by hospital.

Other options if assistance does not apply

If a hospital's program does not fit your situation, other routes exist. Uninsured patients and those not using insurance can ask for the self-pay price; see how to ask for the self-pay price. For scheduled care, these patients can also request a good faith estimate under the No Surprises Act, covered in our good faith estimate guide. Some people also negotiate a balance directly, which our guide to negotiating a hospital bill describes.

To see how hospitals price a service, you can browse Texas hospitals or Florida hospitals. Prices on this site are hospital facility charges taken from the hospitals' own files, not total costs, and they do not replace a hospital's own financial assistance determination. For how to read those files, see using hospital price transparency files. Applying for assistance is something to sort out around the bill, not before urgent care: if someone faces a medical emergency, calling 911 or heading to the closest emergency room comes first, and paperwork can wait.