|
Getting your Trinity Audio player ready...
|
Discover how charity care plans can benefit your practice while expanding access to healthcare services for individuals in need. Learn the essentials of implementing a charity care plan tailored to your organization.
The Affordable Care Act (ACA) expanded access to health care for many individuals across the United States. As a comprehensive healthcare law, the ACA made several significant changes to provisions providing free or discounted medical care to individuals who cannot afford to pay for medical services.
Under these provisions, patients are not expected to pay for the services they receive. At the federal level, this is recognized as required financial assistance. In many states and healthcare systems, it is commonly referred to as “charity care” or “community benefit.” While charity care existed before the enactment of the ACA, the ACA certainly expanded its access and awareness.
The laws of your state will determine whether your healthcare organization must offer some form of charity care. For example, federal and some state laws require nonprofit hospitals to provide a specific amount of charity care to maintain their nonprofit status and tax benefits. In contrast, private practices—both big and small—rarely face requirements to offer charity care. Despite this lack of a mandate, many practices offer charity care to increase access to their services within their communities.
What Is a Charity Care Plan?
A charity care plan operates similarly to an application for public assistance. The plan outlines the requirements necessary to receive charity care. Depending on state laws, a charity care plan can include statements regarding the organization’s policies, procedures, and limitations surrounding charity care. One of the most important aspects of a charity care plan is the sliding fee scale, which informs patients about the cost of services. The plan may also require patients to verify their financial status to qualify.
Generally, charity care plans define who is eligible and who is not. They also explain the services provided, including the discounted rate. For example, in California, hospital charity care plans in non-rural areas must offer discounted services to uninsured patients or those with high medical costs who earn up to 350 percent of the federal poverty level. Similarly, Illinois requires hospital charity care plans in non-rural locations to provide discounted services to any uninsured patient who applies and is under 600 percent of the federal poverty level.
Charity Care for Independent Practices
Your charity care plan may look very different if you do not operate a hospital. Without a statutory requirement to provide discounted services based on the federal poverty level, you may develop your own eligibility criteria. Small practices can benefit from this flexibility. Consider a small behavioral therapy practice or a two-person dental practice. Potential clients want the services, but their insurance does not cover the service, or the client doesn’t have insurance at all.
Those same clients may find the prices are too high to afford out of pocket. Meanwhile, the prices set by the practice are already on the low end of the current market. What can the practices do? They can implement a charity care plan. The clients provide their financial information to the practice. The practice then designates the discount based on the criteria they set. This allows clients to obtain the needed services and enables the practices to generate business that otherwise would not exist.
Beyond the financial benefits, implementing a charity care plan can enhance a practice’s reputation within the community, fostering goodwill and loyalty among patients. It demonstrates a commitment to accessible healthcare, aligning with ethical standards and the practice’s core values. Additionally, offering charity care can help meet professional and industry expectations, positioning the practice as a compassionate and community-focused provider.
Implementing Charity Care
First, seek an experienced healthcare attorney to determine whether your organization has any charity care restrictions or limitations. Required organizations must typically follow additional mandates and guidelines, including reporting or disclosure obligations. These issues may dictate the scope of your charity care offerings.
Once you determine whether your organization must offer charity care, you can design and tailor your plan to fit your organization’s vision. Include relevant policies and procedures in your plan. Be sure to discuss how the organization will offer charity care, the eligibility criteria, and the process you will use to verify eligibility. Patients seeking charity care will be able to determine their eligibility and understand the potential costs and next steps based on the information provided in your plan.
Get Legal Support
Implementing a charity care plan is a significant undertaking for any organization. Working with a healthcare business attorney can help identify the best strategy for implementing your organization’s charity care plan. With such a plan in place, you can provide better care for patients experiencing financial difficulties.
If you operate in one of the states where we have licensed attorneys, schedule a free consultation to learn more about our charity care plan services.
This blog is made for educational purposes and is not intended to be specific legal advice to any particular person. It does not create an attorney-client relationship between our firm and the reader. It should not be used as a substitute for competent legal advice from a licensed attorney in your jurisdiction.
