The hospital bill sits on the counter for a week before anyone opens it. When someone finally does, the number is the kind that changes a household budget for a year. The instinct is to call and ask for a payment plan, or to reach for a credit card.
There is a question that often comes before either of those, and many patients never ask it. Does this hospital have a financial assistance program, and do I qualify?
Many hospitals do. For nonprofit hospitals, federal tax rules require it. And in many cases, you can apply even after the bill has arrived.
What hospital financial assistance is
Financial assistance, sometimes called charity care, is a hospital program that reduces or eliminates the bill for eligible patients. Each hospital sets its own eligibility rules, usually based on household income and family size, and sometimes on assets or the size of the bill compared with income.
Depending on the program and your situation, assistance might cover the full bill, part of it, or offer a discount on a sliding scale. Some programs help insured patients with large deductibles or coinsurance too, not only people without coverage.
Why nonprofit hospitals have to offer it
Most U.S. hospitals that are tax-exempt charities must meet requirements in Section 501(r) of the tax code. Among other things, the IRS requires these hospitals to:
- Have a written financial assistance policy for emergency and other medically necessary care
- Publicize it widely, including a plain-language summary
- Limit what eligible patients are charged for emergency and medically necessary care
- Make reasonable efforts to check eligibility before taking certain aggressive collection steps
For-profit and government hospitals are not covered by these specific federal rules, but many run their own programs, and some states have their own charity care laws. It is always worth asking, whatever kind of hospital sent the bill.
Based on IRS guidance for Section 501(r)(6). These rules apply to tax-exempt hospitals; exceptions and details apply.
What “extraordinary collection actions” means
The IRS uses this term for the most serious collection steps. Under its guidance, examples include selling a patient’s debt to another party, reporting negative information to credit bureaus, delaying or denying medically necessary care because of an unpaid bill, and legal actions such as liens, wage garnishment or lawsuits.
Before taking these steps, a nonprofit hospital generally must give patients a chance to learn about and apply for financial assistance, including written notice and a plain-language summary of the policy. That is why applying early matters: it can pause or change what happens next.
How eligibility is usually decided
Every hospital writes its own rules, so there is no single cutoff. Most programs look at some combination of:
Because the rules differ so much, the only way to know is to read that hospital’s policy or ask. Many hospitals post the policy and application on their website, often under “financial assistance,” “charity care” or “billing.”
How to apply, step by step
- Find the policy. Check the hospital’s website or ask the billing office for the financial assistance policy, the plain-language summary and the application.
- Read the eligibility rules. Look for income levels, household size rules, and whether insured patients can apply.
- Gather documents. Programs commonly ask for proof of income, such as pay stubs or a tax return, and sometimes bank statements.
- Apply and tell billing. Submit the application and let the billing office know, so they can note it on your account.
- Keep records. Save copies of everything you send, and write down the date, the name of the person you spoke with and any reference number.
- Follow up. If you have not heard back in a few weeks, call and ask for the status.
Related: Before You Put a Medical Bill on a Credit Card, Check These 7 Options
A hypothetical example
Here is a made-up scenario to show how a sliding scale might work. It is not a typical result and does not reflect any specific hospital.
| Household income vs. program levels | Discount on eligible balance | On a $6,000 balance |
|---|---|---|
| Below the program’s lowest level | 100% | $0 |
| Middle level | 60% | $2,400 |
| Upper level | 30% | $4,200 |
| Above program limits | 0% | $6,000 |
Even a partial discount can change what a payment plan looks like. That is why applying first, then setting up a plan for what remains, often makes sense.
Questions to ask the billing office
1. “Do you have a financial assistance or charity care program, and can you send me the policy and application?”
2. “Can patients with insurance apply for help with what they owe after insurance?”
3. “Will you hold my account from collections while my application is reviewed?”
4. “Can I apply for this bill even though I already received it?”
Two things people get wrong
Which situation looks like yours?
Related: The Number on Your Medical Bill May Not Be the Number You Actually Owe
If you have insurance
Financial assistance is not only for people without coverage. Many people with insurance still face a large balance after their plan pays, especially early in the year or on a plan with a high deductible.
If the hospital’s policy allows insured patients to apply, timing matters. It usually makes sense to wait until your insurer has processed the claim and sent an Explanation of Benefits, so you and the hospital both know the real amount you owe. Then apply for help with that remaining balance.
When you apply, include a copy of the EOB along with your income documents. It shows the hospital exactly which part of the bill is yours.
Related: “Insurance Paid” Doesn’t Mean “You Owe $0.” Here’s the Math
If the bill is already in collections
A bill that has moved to a collection agency can feel like a closed door. It often is not.
- Call the hospital, not just the collector. Ask whether you can still apply for financial assistance for that account, and whether the account can be recalled or paused while your application is reviewed.
- Ask the collector to validate the debt. Under federal debt collection rules, you generally have the right to request information confirming the debt, especially if you respond within the window stated in the collector’s first notice.
- Compare the amount with your records. Check it against the hospital bill and any EOB to make sure payments and adjustments are reflected.
- Get agreements in writing. If the hospital or collector agrees to reduce, pause or settle the balance, ask for written confirmation before you pay.
For questions about collection practices, the Consumer Financial Protection Bureau (CFPB) publishes plain-language guidance on medical debt and debt collection.
A short request you can adapt
You do not need a formal letter, but writing your request down keeps things clear. Something like this is usually enough:
“I am writing about account number [your account number] for care on [date of service]. I would like to apply for financial assistance under your hospital’s policy. Please send me the application and the plain-language summary, and please note on my account that I am applying, so that no collection action is taken while my application is reviewed. Thank you.”
Send it through the hospital’s patient portal, by email or by mail, and keep a copy with the date you sent it.
Documents to gather
Each hospital asks for different things, but these come up often. Having them ready can speed up a decision:
- Recent pay stubs, or proof of other income such as benefits letters
- Your most recent tax return, if you filed one
- Recent bank statements, if the hospital asks about assets
- A list of people in your household
- The hospital bill and, if insured, the Explanation of Benefits
- Any letters from the hospital or a collection agency about the account
If you do not have one of these, such as a tax return, ask the hospital what it accepts instead. Many programs allow other proof of income.
Frequently asked questions
Do all hospitals offer financial assistance?
Tax-exempt nonprofit hospitals must have a written financial assistance policy under IRS rules. Many other hospitals offer programs too, and some states have their own requirements. Ask the hospital directly.
Can I apply if I have insurance?
It depends on the hospital’s policy. Some programs help with deductibles and coinsurance; others focus on uninsured patients.
Does applying affect my credit?
Applying itself is a request to the hospital. What happens with collections depends on the hospital’s policy and applicable rules, so ask how your account will be handled while your application is reviewed.
What if a doctor’s bill is separate from the hospital bill?
Doctors and other providers who bill separately may not be covered by the hospital’s program. The hospital’s policy is supposed to list which providers it covers, so check that list and ask the other providers about their own options.
Keep reading
Sources to review: IRS.gov, “Billing and collections – Section 501(r)(6)” and “Financial assistance policy and emergency medical care policy – Section 501(r)(4)”; your hospital’s financial assistance policy; your state attorney general or insurance department.
This article is educational information, not legal, medical or financial advice. Examples are hypothetical, and each hospital sets its own eligibility rules. Confirm details with the hospital and official sources.