Nonprofit Hospital in Washington State Failed to Inform Eligible Consumers of Financial Assistance

By Consumers for Quality Care, on December 13, 2023

Washington State Attorney General Bob Ferguson’s investigation into PeaceHealth, a nonprofit Catholic health system, uncovered inconsistencies in how its hospitals informed low-income patients about their eligibility for charity care, Healthcare Dive reports.

Increasingly, nonprofit hospitals are coming under scrutiny from policymakers. The concern is that these hospitals are shirking their responsibility to provide charity care – discounted or free health care services – to eligible patients. Some policymakers are beginning to acknowledge that, by leaving low-income patients saddled with unaffordable medical bills, nonprofit hospitals are contributing to the growing medical debt crisis in America.

Nonprofit hospitals are, by definition, charitable organizations. As a result, these hospitals are exempt from paying most taxes. In exchange for these exemptions, nonprofit hospitals are expected to provide benefits to the public, such as charity care.

PeaceHealth has agreed, as part of its settlement with the Attorney General, to (1) notify all patients about its charity care programs before seeking payment, (2) offer screenings for charity care eligibility, and (3) delay billing until applications for charity care are processed. Additionally, PeaceHealth will pay up to $13.4 million in refunds for as many as 15,500 consumers.

Although CQC applauds the outcome of this settlement, we urge policymakers everywhere to ensure that all nonprofit hospitals devote adequate resources to charity care programs.