Centers for Medicare & Medicaid Services summary:
Questions On Charges For The Uninsured
Q1: Can a hospital waive collection of charges to an indigent, uninsured individual?
A1: Yes. Nothing in the Centers for Medicare & Medicaid Services’ (CMS’) regulations, Provider Reimbursement Manual, or Program Instructions prohibit a hospital from waiving collection of charges to any patients, Medicare or non-Medicare, including low-income, uninsured or medically indigent individuals, if it is done as part of the hospital’s indigency policy. By “indigency policy” we mean a policy developed and utilized by a hospital to determine patients’ financial ability to pay for services. By “medically indigent,” we mean patients whose health insurance coverage, if any, does not provide full coverage for all of their medical expenses and that their medical expenses, in relationship to their income, would make them indigent if they were forced to pay full charges for their medical expenses. (Emphasis added)
In addition to CMS’ policy, the Office of Inspector General (OIG) advises that nothing in that agency’s rules or regulations under the Federal anti-kickback statute prohibits hospitals from waiving collection of charges to uninsured patients of limited means, so long as the waiver is not linked in any manner to the generation of business payable by a Federal health care program – a highly unlikely circumstance.
CMS: Definition (Policy) for Charity Care (Financial Assistance)
Charity Care. – The value of medical expenses that exceed the patient’s financial ability-to-pay the hospital organization’s charges so as to not cause the individual being rendered medically indigent
Medically Indigent. – Patients whose health insurance coverage, if any, does not provide full coverage for all of their medical expenses and that their medical expenses, in relationship to their income, would make them indigent if they were forced to pay full charges for their medical expenses
Indigency Policy. – means-test insured and uninsured patients as to his or her financial ability-to-pay the hospitals charges and not be forced into “medical indigency.”