ROCHESTER — Charity care, free or discounted hospital care, is available, but few Minnesotans know they might be eligible.
Minnesota hospitals generally determine patient eligibility based on the patient’s household income relative to federal poverty guidelines. At Olmsted Medical Center, for example, patients are eligible to apply for assistance if their family earns less than 300% of the federal poverty guidelines, meaning a single person could qualify if they earn less than $43,740, or a family of four, if she earns less than $90,000.
“Hospital charity care, also known as financial assistance, is a tool we have to protect low-income patients from being left bankrupt or struggling for years to pay large medical bills,” said Anna Odegaard, the director of the Minnesota Building Asset Coalition. “And it’s not just uninsured patients who can be saddled with unpayable bills. People with high-deductible health plans can end up with thousands of dollars in medical debt for a single hospital stay.”
Providing charitable care is a requirement for all nonprofit hospitals because they don’t have to pay taxes — a feat that saves hospitals like the Mayo Clinic hundreds of millions of dollars each year. However, eligibility varies from hospital to hospital, and many Minnesotans can find it difficult to access charitable care information, a problem that Odegaard and Minnesota lawmakers hope to alleviate through legislation.
The Post Bulletin conducted a survey of the website of every non-profit hospital in Minnesota from more than 100 health systems, collecting eligibility requirements for charity care, applications, and interviewing hospitals that had not disclosed the information online. The results are contained in the following database.
No standard for eligibility
Nonprofit hospitals are required by the Affordable Care Act to provide financial assistance policies, but it is up to the hospital what it covers in its policy.
“There are no exact standards for these benefits,” said Maddie Renneke, communications specialist for the Minnesota Hospital Association. “However, Minnesota’s health systems have been rather generous with their welfare and financial assistance policies, contributing $3.3 billion to their communities in 2020 alone.”
Renneke also noted that hospitals offer payment plans and that hospital emergency rooms are open 24 hours a day, offering services to everyone who enters regardless of their ability to pay.
Because there are no precise standards for how much charity hospitals provide and for whom, eligibility and application requirements vary. Odegaard said this variability makes it difficult to educate communities about the availability of financial support, as a person may be eligible for support in one hospital but not in another.
For example, OMC requires home equity to be below these specific income guidelines and refuses to provide certain medical services, such as surgical birth control. Other hospitals consider health insurance status or other assets.
“Medical debt is rarely chosen, and most of us don’t think a family should face a financial crisis to seek necessary medical care. Funding hospitals is one tool we have to protect low-income patients.”
Anna Odegaard, Minnesota Building Asset Coalition
The common denominator between policies across the state is that household income is the starting point for determining eligibility.
Mayo Clinic, Winona Health Services, Gundersen St. Elizabeth’s Hospital and 22 other Minnesota hospitals with available data are considering patients for financial assistance of up to 400% of the federal poverty guideline.
Meanwhile, around the same amount of aid from Minnesota hospitals, 21, is limited to patients with an annual household income of 200% FPG or less, or $29,160 for a single person.
Riverview Health in Crookston has the most restrictive income requirements and is limited to patients earning less than 150% FPG or $21,870.
“Hospitals have broad discretion over charitable care eligibility policies,” said Ge Bai, a professor of accounting and public health at Johns Hopkins University who studies charitable care. “Some have chosen to be more generous than others. Hospitals interested in advancing charitable missions should consider raising their income test cap for eligibility for charitable care.”
In a 2022 study on charity care co-authored by Bai, her team found that three-quarters of nonprofit hospitals nationwide covered at least 200% of the cost rate for discounted charity care and 38% of hospitals covered at least 400% of the cost rate, according to the 2018 data.
Compared to the national data, income requirements for nonprofit hospitals in Minnesota are more restrictive. Less than a quarter of Minnesota’s nonprofit hospitals cover up to 400%.
Some states, like Washington, have imposed higher standards for hospital financial support, and Odegaard said she hopes Minnesota will follow Washington’s example. She also wants the state to consider adding provisions to support smaller hospitals that are more financially vulnerable so they don’t have to cut short on their charitable supplies to keep the hospital afloat.
“As a state, we should find another way to support these hospitals and not allow them to shift the financial burden onto low-income families,” Odegaard said.
The IRS requires nonprofit hospitals to “publicize widely” the financial assistance policy by posting an easy-to-understand summary and application on their websites and in public places, as well as informing members of the community receiving care of the program’s existence and inform. Many hospitals, including the Mayo Clinic, include a link to financial aid information on the statement.
“There is a wide range of services to make patients aware of payment options – from websites to financial advisors in institutions,” said Renneke. “Hospitals and healthcare systems are constantly looking for new ways to raise awareness of these options so Minnesota residents can get the right care, in the right place, at the right time.”
However, an analysis by the Post Bulletin found that the following systems, 8% of all Minnesota hospitals, do not share eligibility information for charity or, in some cases, the application or policy on their websites, even though it is a state requirement: CCM Health , Madison Health Care Services, Mahnomen Health Center, Welia Health, Hendricks Community Hospital, Big Fork Valley Hospital, Appleton Area Health, Cook Hospital & Care Center and Sleepy Eye Medical Center.
Welia Health spokeswoman Sheila Peterson said the eligibility information has not yet been released online, but the hospital plans to post it online within the next quarter.
Sleepy Eye Medical Center spokeswoman Mikayla Bruggerman also said the information will be posted online in the near future. At the time of publication, none of the hospitals had added the information to their websites.
The other hospitals did not respond to multiple requests for comment. None of these hospitals are in Southeast Minnesota.
This problem also occurs at national level. According to a December survey by Kaiser Health News, 1 in 5 hospitals surveyed by KHN does not publish assistance guidelines online.
Hospitals have broad discretion regarding charitable eligibility policies. Some have chosen to be more generous than others.
Ge Bai, a Johns Hopkins University
The majority of Minnesota hospitals display the information online, but it can be difficult to find. While bill-paying information is almost always prominently displayed on the home page, most Minnesota hospitals require users to click through multiple pages to find charitable care information.
For example, patients at Olmsted Medical Center must navigate through the Patients & Visitors page to find charity care information. Northfield Hospital’s Financial Assistance Policy was not easily accessible by clicking on the website. The Post Bulletin was only able to find the policy by looking it up on Google. Other hospital policies were buried deep in multi-page PDFs.
The Mayo Clinic is one of only 12 nonprofit hospital systems in Minnesota to advertise financial aid on its home page.
“Hospitals can make it easy or difficult for patients to become aware of their opportunity to apply for charity care,” Bai said. “Hospitals that want their eligible patients to receive charity care should minimize patient information barriers.”
One method Odegaard is urging is to require Minnesota hospitals to provide patients with information about the policy on a separate document in non-technical language and in large print, preferably in one, during the initial admissions process language they speak fluently. In addition, patients should be asked to sign an acknowledgment that they have received and understand the information, just as they are required to do for information about their HIPAA rights.
“If all patients who were eligible for financial assistance knew it was available and could apply for it, we would see fewer families in crisis struggling to pay off their debts while rent and groceries ran out and on the forgo the necessary care,” said Ödegaard.