Poster #162 - Hospital characteristics and income eligibility thresholds for financial assistance

• In Event: Saturday Poster Luncheon

Abstract

Most hospitals publish their financial assistance (FA) policies online, which usually describe a patient’s maximum income threshold for FA eligibility. This threshold might be a requirement set by state regulations or decided on by the system or hospital. Understanding the eligibility and availability of FA is important, given it determines whether low-income patients may face medical debt from their hospital visits.

We used the Lown Institute Financial Assistance Policy data, which consists of a sample of 2,515 general acute care hospitals across the US. We extracted the free and discounted care income thresholds if written as a percentage of the federal poverty level (FPL) or guidelines (FPG) (2,025 [80.5%] of hospitals had free care income thresholds). The majority of these hospitals (65.8%) had a free care threshold of 200% FPL or less. Compared to these hospitals, hospitals with an income threshold of at least 300% FPL (N = 341) were more likely to be larger, in urban and wealthier areas, and spent more on financial assistance ($30,179 per bed vs $22,374).

Hospitals with a free care income threshold of 200% FPL were in counties where the median income level ranged from $30,816 to $203,871, sourced from 5-year estimates from the 2023 American Community Survey data. We calculated the ratio between the county median income and hospitals’ free care income thresholds, after converting these percentages to an income value based on the most recently published FPL/FPG levels. 

We quintiled this ratio and compared characteristics of hospitals in the top quintile to the bottom. Hospitals in the top quintile had free care income thresholds ranging from 0.75 to 2.08 times the community income, while the bottom quintile had values from 0.07 to 0.42. There were 166 Hospital Referral Regions with at least two hospitals in our data, and 81 (48.9%) of these regions had at least one hospital in both the top and bottom quintile.

The top quintile hospitals had higher financial assistance spending (median $30,732 per bed versus $17,270) and lower net patient revenue (median $1.5M per bed versus $1.8M) than hospitals in the bottom quintile. There was no significant difference in bed counts, the proportion of rural hospitals, ownership type, or teaching hospitals between the two groups. 

Researchers and regulators examining income eligibility requirements for FA should adjust for local income levels for fairer comparisons between hospitals. For instance, when we compared hospitals using a ratio of free care income threshold to median county income, rural and urban hospitals were just as likely to be in the top group. Hospitals that set high income thresholds for FA eligibility spend more on FA, an important result given other unobserved factors that may influence FA spending (such as the volume and approval rate of applications). Regulations to set a minimum threshold for FA income eligibility, particularly in higher-income areas, would increase this spending and potentially protect more families from facing medical debt.

Authors

• Kelsey Chalmers, Lown Institute
  Non-Presenting Co-Author

• Judith Garber, Lown Institute
  Presenting Author