Charity Care (Financial Assistance)

How It Works

The IRS requires all 501(c)(3) tax-exempt hospitals to maintain a written Financial Assistance Policy (FAP) describing who is eligible for free or discounted care. Most policies cover patients with incomes below 200-400% of the federal poverty level. Many patients who qualify for charity care don't know it exists or don't apply. Hospitals are required to make "reasonable efforts" to inform patients about financial assistance before sending bills to collections. If you're facing a large hospital bill and your income is below about $60,000 for a single person or $120,000 for a family of four, ask the hospital's billing department about their Financial Assistance Program — most nonprofit and government hospitals will reduce or eliminate your bill.

Related Terms

• Nonprofit Hospital — A hospital organized as a tax-exempt entity — making up about 56% of U.S. community hospitals — that reinvests revenue into the community in exchange for federal, state, and local tax exemptions.
• Good Faith Estimate — A written estimate of expected charges for scheduled healthcare services that uninsured or self-pay patients have the right to receive under the No Surprises Act.