Study Finds Nonprofit Hospitals Set Uniform Free Care Thresholds
A study published Nov. 2 in Health Affairs, by researchers from Tulane and Northeastern universities, finds that nonprofit hospitals in high-need communities set income eligibility thresholds for free and discounted care that are similar to those set by hospitals in lower-need areas. Drawing on IRS data from 1,624 nonprofit hospitals between 2013 and 2022, the researchers found that expanding free care eligibility by 100 percentage points of the federal poverty level was associated with roughly $184,600 more in charity care and $539,600 less in bad debt for a hospital with median operating expenses. That association was stronger in high-need counties, where the same expansion correlated with about $383,400 more in charity care and $1.68 million less in bad debt. The authors conclude that eligibility thresholds may signal charitable intent, but actual charity care delivered is driven largely by local community demand.