Nonprofit Hospitals Found Spending Little on Charity Care

By Consumers for Quality Care, on December 6, 2022

New research from the Kaiser Family Foundation revealed half of hospitals spend just 1.4 percent of their entire operating expenses on charity care, according to Healthcare Dive. 

Charity care programs provide free or discounted medical care to low-income consumers. Federal law requires tax-exempt nonprofit hospitals to provide charity care but does not stipulate how much charity care to provide. A recent study found that the value of that tax exemption for nonprofit hospitals is far greater than the amount spent on providing charity care.

The need for charity care has reached an all-time high as four in ten adults report having medical debt and about one in seven adults reported putting off medical treatment at some point due to cost.

The data found that eight percent of hospitals provided 0.1 percent or less in charity care.

There has been a recent push to enforce charity care programs after a report from The New York Times found that Washington-based health system Providence spent less than one percent of its expenses on charity care while it continued to saddle consumers who were eligible for financial assistance with medical debt.

CQC urges all hospitals, particularly nonprofit hospitals, to hold up their end of the bargain to better serve their communities and deliver care for patients when they need it most.