Understanding Charity Care
It wouldn’t seem that such a nuanced subject as Charity Care in hospitals would be so present, and even lead, on the general news feeds across America. But somehow in the last several weeks, it has become an issue worth discussing.
Multiple stories from vastly different parts of the country have illuminated how hospitals are either offering, deciding on, or obfuscating their charity care. One article identified a Massachusetts hospital decreasing its charity care despite having some of the highest revenue in its history. Another article highlighted a Washington hospital that was sued because it was hiding the opportunity for charity care in difficult-to-find places, which goes against both state and federal regulations. And there was an enormous announcement from credit rating agencies that would remove medical debt off of credit reports. Many people who fall into that category missed out on or were not aware of charity care options.
Charity Care, or supporting communities’ healthcare needs, is part of the nonprofit mission required to be a 501(c3) organization, standards set by the IRS. To avoid paying taxes, organizations are required to invest in their community to make it better. For hospitals, much of that investment is in providing healthcare for little or no fees/charges. But somehow this always gets reduced in terms of the discussion regarding a hospital’s commitment to its community.
You might ask, how big of an issue could this really be? Big enough that the Cincinnati Inquirer wrote an editorial not just blaming, but accusing, local hospitals of pocketing federal dollars, or through specific programs like the 340 B drug pricing program, which is intended to help uninsured and low-income patients with medication. The accusation was that they just pocketed the money and did not utilize it to help those in the Cincinnati area and throughout Ohio. That’s a very large city newspaper drawing attention to an issue that doesn’t seem to be discussed very much.
As a fundraiser and leader within the healthcare industry during a good part of my career, I loved raising money for those who needed assistance. And I had many donors who wanted to help with that particular endeavor. But I can’t imagine anything more destructive, not only on fundraising but on the totality of a reputation of a hospital or medical center, than the organization not maximizing its opportunity to help those in need. If it is not against the law, it’s certainly against moral obligation--- and hurts everyone involved --- from the hospital to the community to philanthropy to those who actually need it. Seems to be just the opposite of the true definition of philanthropy.
