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Texas nonprofit hospitals owe needy patients charity care, but many never hear of it until the bill arrives

A Public Health Watch investigation finds Texans with low incomes falling into medical debt they may not owe. Advocates say the required notices fall short; the Texas Hospital Association says hospitals meet every legal standard.

Marlene Abbott· AI-assisted, edited by Jake Team

October 27, 20263 min read

Hospital Charity Care - illustration, Jake Team LLC

Every nonprofit hospital in Texas has to offer free or discounted care to patients who cannot afford their bills. Whether those patients ever find out about it is another matter, according to an investigation published Tuesday by Public Health Watch, a nonprofit newsroom based in Lakeway.

Charity care, also called financial assistance, is a condition of the tax exemption nonprofit hospitals receive under state and federal law. Hospitals are also required to tell patients the help exists. The usual methods, the report says, are signs in emergency rooms, a policy posted online, a notice with billing paperwork and a yearly newspaper notice.

Advocates told the outlet that is not enough. Jared Walker, who founded the national nonprofit Dollar For, said his group has filed more than 8,000 charity care applications for Texans, 14% of its total nationwide and far more than second-place Florida, at about 5,200.

"The poster in the ER doesn't work," he said, adding that most of the people his group helps leave the hospital unaware the program exists.

A survey of 800 Texans last year by the Texas Public Policy Foundation found fewer than half had heard of hospital charity care, the report says.

The industry's view

The Texas Hospital Association declined an interview, but has said in public statements that every nonprofit hospital in the state meets the legal standards for offering financial assistance and telling patients about it.

Houston Methodist, whose patient is featured in the story, said in a statement that it promotes its program with emergency room signs, its website and notices on billing statements, and that staff will help patients apply.

Texas is one of only several states that set a minimum: nonprofit hospitals must put at least 4% of net patient revenue toward charity or other indigent care. The association's figures show nonprofit hospitals provided nearly $15 billion in charity care, community benefits and unpaid costs of government indigent care in 2024.

Rules that vary by hospital

Who qualifies depends on where you are treated. The report cites a rural hospital southwest of Fort Worth that offers free care up to 150% of the federal poverty level, Houston Methodist at 200%, and two others at 400% and 500%. Patients have at least 240 days after their first bill to apply under federal law, but bills can be sent to collectors before that.

A Lown Institute analysis done for the outlet found Texas nonprofit hospitals are more likely than those elsewhere to sell patients' debt and to refuse non-emergency care to people who owe money. A bill filed by Republican state Rep. Tom Oliverson that would have required hospitals to screen patients for assistance before chasing a debt did not reach the governor.

In North Texas, the story notes, an application at Texas Health Resources hospitals can require dozens of documents, from pay stubs and bank statements to letters from employers.

One uninsured Baytown woman described in the report received bills topping $117,000 after gallbladder surgery. With Dollar For's help, her debt was cut to about $7,000.

Sources

publichealthwatch.org

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Marlene Abbott· AI-assisted, edited by Jake Team

Marlene Abbott writes about community life, schools, public safety, and local events in Aubrey.

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