Free Care Provided by N.C. Hospitals Doesn’t Equal Value of Tax Breaks

Nonprofit medical centers in North Carolina have received tax breaks above the value of free care they provided to poor and uninsured patients, according to a review of hospital financial records by the Charlotte Observer and The News & Observer of Raleigh.

In 20120, tax relief for nonprofit hospitals in the state totaled, on average, about 4.4 percent of the institutions’ budgets. But most of the hospitals reported spending less than 3 percent of their budgets on charity care that year; for about a third of them, mostly in poorer rural areas, the amount was below 2 percent.

North Carolina has no legal requirements that nonprofit hospitals allocate a prescribed amount of their budgets or revenue to charity care. Industry groups say the institutions provide community benefits well above the amount spent on free care and are burdened with bad debt from treating uninsured patients who do not apply for financial assistance.

The newspapers interviewed several dozen patients who said they were never offered charity-care options at the time of treatment.