A Review of Hospital Financial Assistance Policies in the States
Over 26 million Americans do not have health insurance of any kind while almost half of nonelderly adults have inadequate insurance with high deductibles and significant out-of-pocket costs. In the meantime, health care costs and rates of medical debt continue to rise. It is more important than ever for states to require that all hospitals provide comprehensive financial assistance for hospital care.
The Affordable Care Act requires certain nonprofit hospitals with 501(c)(3) tax-exempt status to provide certain community benefits, including financial assistance for low-income patients. 26 CFR §1.501(r) (“501(r)”) requirements include establishing a written Financial Assistance Policy (FAP) and a written Emergency Medical Care Policy. However, these requirements apply only to nonprofit hospitals, and the ACA and its implementing regulations do not specify minimum standards or eligibility criteria for this financial assistance. If a nonprofit hospital fails to comply with these requirements, the patient does not have a private right of action under the statute to seek redress for noncompliance, as only the IRS can enforce these requirements.