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Home + Healthcare Articles + Charity care
Charity care
Charity care is a term used in the United States
to refer to health care services rendered to patients unable
to pay for some, in whole or in part.
More specifically, the term refers to a scheme
used by the state of New Jersey to provide reimbursements to
hospitals and other health-care institutions which provide uncompensated
or undercompensated health care to patients lacking private
health insurance whose income falls below a certain amount but
is too high to qualify them for Medicaid and are not old enough
to be eligible for Medicare (New Jersey's situation is somewhat
unique among American states in that the state has no county
or municipal hospitals).
The scheme provides free health care to uninsured
state residents whose income is up to 200% of the federally-designated
poverty line, and provides discounts which gradually phase out
at incomes between 200% and 300% of the poverty line; the patient's
liquid assets (not including the patient's home and one automobile)
must not exceed $7,500. Also, the maximum any individual qualifying
for aid under the aforementioned criteria can be liable for
in a single year is 30% of that patient's gross income for that
year. A special fund compensates the health-care provider -
which may have furnished either inpatient or outpatient services
- for the applicable difference in cost.
Some private health-care providers in other
states - particularly those that are operated on a nonprofit
basis (often by religious entities) - also provide free and/or
low-cost health care to uninsured patients, using income thresholds
similar to those observed statewide in New Jersey; but state
laws vary widely as to how much, if any, reimbursement (usually
in the form of tax credits) the institution receives for so
doing (and in only one other state besides New Jersey - Washington
- does an outright mandate exist to provide charity care). Perhaps
the most famous example of such an institution is the Charity
Hospital of New Orleans, founded in 1732 and now run by the
Medical Center of Louisiana.
Many political moderates in the United States
point to the success of the New Jersey program, and recommend
its adoption at the federal level as an alternative to national
health-insurance proposals advocated by many liberals, which
conservatives pejoratively characterize as "socialized
medicine".
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