Nonprofit hospitals in high-need communities set income eligibility thresholds for free and discounted care similar to those of hospitals in lower-need areas, according to a study published Nov. 2 in Health Affairs.
The study, written by researchers Tatiane Santos, PhD, of Tulane University in New Orleans and Neelam Ahmed and Gary Young, PhD, of Northeastern University in Boston, is based on IRS data from 1,624 nonprofit hospitals from 2013 to 2022.
Over the study period, expanding free care eligibility by 100 percentage points of the federal poverty level, such as from 100% to 200%, was associated with about $184,600 more in charity care and $539,600 less in bad debt for a hospital with median operating expenses of $142 million, the researchers found. The association was stronger in high-need counties, where the same expansion was tied to about $383,400 more in charity care and $1.68 million less in bad debt relative to lower-need counties.
“These findings suggest that although financial assistance policy eligibility thresholds may signal charitable intent, realized charity care is driven largely by community demand,” the authors wrote.
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