Boston – Americans overwhelmingly – 90 percent – believe that nonprofit hospitals have an obligation to serve their communities because of their tax-exempt status, and 74 percent strongly support regulation requiring them to provide charity care or face penalties if they fall short, according to the results of a Community Catalyst survey released today.
Because they benefit from valuable tax breaks, nonprofit hospitals are required to provide community benefits, including reduced cost or free care to uninsured or underinsured (“self-pay”) patients. While some nonprofit hospitals are doing their part to ensure that charity care is central to addressing the health care needs of their community, many are not fulfilling their obligation. Some charge self-pay patients – those least able to afford health services – up to three times more than what patients with private or public health coverage pay.
“The current economic crisis is not only costing people their jobs, but also their employer-based health coverage, leaving an increasing number of patients unable to pay what hospitals charge,” said Renée Markus Hodin, director of Community Catalyst’s Hospital Accountability Project (HAP). “While many nonprofit hospitals also have been hit hard by the downturn, they won’t solve their financial problems by bankrupting patients. Our survey results show that Americans overwhelmingly believe that nonprofit hospitals should be providing access to care to those who can’t afford it and held accountable for meeting this obligation of their tax-exempt status.”
Among the survey highlights include:
- 90 percent of Americans think nonprofit hospitals should be required to provide information to the public on the free and low cost programs and services they provide to the community
- 88 percent of respondents support price regulation for uninsured patients so they are not overcharged for services
- 82 percent of respondents believe that nonprofit hospitals have an obligation to work with patients who don’t have enough money to pay for care upfront and to help them with a financing plan
- 79 percent of respondents say nonprofit hospitals tax-exempt status obliges them to provide charity care
In addition, 82 percent of Americans believe that when people can’t get hospital care because of their inability to pay, the health and well being of the whole community suffers.
Recent studies have shown that both government oversight and industry performance with regard to hospital community benefits, including charity care and debt collection practices, have been inconsistent across the country. Community Catalyst’s 2008 survey of the free care laws and regulations in each of the 50 states found that they vary dramatically from place to place, and a recently issued report from the Internal Revenue Service (IRS) confirmed that some nonprofit hospitals provide a disproportionately large share of the charity care/community benefits burden in their communities while others do very little. This inconsistency has enabled some hospitals to employ predatory policies on self-pay patients, including: requiring significant up-front payments before providing medically necessary treatment; selling patient debts to third party lenders with exorbitant interest rates, garnishing wages or placing liens on patients’ homes; and falsely denying that the hospital offers free care.
In the wake of new IRS hospital reporting requirements adopted last year, several states, including Alabama, Arkansas, Maryland, Tennessee, Virginia, and West Virginia, have introduced legislation to require nonprofit hospitals to provide notice to patients about their charity care programs. Some of these bills would also place limits on hospitals’ billing and debt collection practices or set minimum standards for charity care.
“With so many Americans facing insurmountable medical bills on top of other financial strains, now is the time for states to act,” Hodin said. “By enacting or strengthening laws governing the responsibilities of tax-exempt hospitals to their communities, states keep hospitals honest and Americans safe from medical indigency.”
The national survey of 800 likely voters was conducted by the national firm Lake Research Partners during November 12-17, 2008.
To view survey results, please visit www.communitycatalyst.org/charitycarepollingresults.
To view Community Catalyst’s Free Care Compendium – including a national snapshot of trends across the states – visit http://communitycatalyst.org/projects/hap/free_care .
About Community Catalyst
Community Catalyst is a national non-profit advocacy organization dedicated to quality affordable health care for all. Since 1997, Community Catalyst has been working to build the consumer and community leadership required to transform the American health system. With the belief that this transformation will happen when consumers are fully engaged and have an organized voice, Community Catalyst works in partnership with national, state and local consumer organizations, policymakers, and foundations, providing leadership and support to change the health care system so it serves everyone—especially vulnerable members of society. For more information, visit www.communitycatalyst.org.