Who is required to have financial assistance programs
All nonprofit hospitals that have 501(c)(3) tax-exempt status must maintain a written financial assistance policy under IRS Section 501(r), enacted as part of the ACA. This covers most community hospitals, teaching hospitals, and health system hospitals in the United States.
For-profit hospitals are not legally required to have financial assistance programs, but many do. Government-owned hospitals have their own programs governed by state or local rules. Even for-profit systems often have charity care programs that mirror nonprofit requirements.
Income and eligibility thresholds
Income thresholds vary by hospital and state, but many programs cover patients earning up to 200% to 400% of the federal poverty level (FPL). For 2026, 200% FPL is approximately $30,120 for a single person and $61,920 for a family of four. At 400% FPL, those figures double.
Some hospitals use a sliding scale: patients below 200% FPL pay nothing, patients between 200% and 300% FPL pay a reduced percentage, and so on up to the program limit. The specific scale is in the hospital's financial assistance policy, which they are required to make publicly available.
What financial assistance can cover
Financial assistance programs can apply to any medically necessary service provided at the hospital, including emergency care, inpatient stays, outpatient procedures, and associated physician fees if those physicians are hospital employees.
The program typically reduces or eliminates the charges before insurance is applied. If you have insurance, the program may cover amounts your insurance leaves as your responsibility: your deductible, copay, or coinsurance. The most generous programs eliminate all patient-responsibility amounts for qualifying patients.
How to apply
Call the hospital billing department and say: "I would like to apply for your financial assistance program." By law, the hospital must give you an application and plain-language information about the program. They cannot send your bill to collections for at least 120 days after providing care and must give you at least 30 days after notifying you about the application before taking collection actions.
You will typically need to provide: proof of income (recent tax returns, W-2s, or pay stubs), proof of household size (a list of dependents), and sometimes bank statements. If you do not have all documents, submit what you have and ask for an extension.
Limits on collection while you apply
Under IRS 501(r) rules, nonprofit hospitals cannot take "extraordinary collection actions" before making a reasonable effort to screen you for financial assistance. Extraordinary collection actions include: reporting to credit bureaus, filing lawsuits, garnishing wages, and placing liens on property.
If a hospital takes collection action without first notifying you of its financial assistance program, it is in violation of 501(r). File a complaint with the IRS using Form 13909 and your state attorney general's office.
Frequently asked questions
Can I apply for financial assistance after my bill has gone to collections?
Yes. Many hospitals will recall a bill from collections if you apply for financial assistance and qualify. Apply immediately upon receipt of any collection notice and reference the hospital's 501(r) obligations in your application.
What if I do not qualify for the main financial assistance program?
Ask about a sliding-scale discount or a reduced self-pay rate. Many hospitals have multiple tiers. Also ask whether the hospital has a separate "prompt-pay discount" or "uninsured discount" that does not require an income-based application.
Does applying for financial assistance affect my credit?
The application itself does not affect your credit. While an application is pending, the hospital should not be reporting the debt or taking collection actions. If it does, that is a potential 501(r) violation.
Can financial assistance cover past bills I have already paid?
Possibly. If you paid a bill within the past year and believe you would have qualified for assistance, ask the hospital. Some programs will retroactively apply assistance and refund your payment. This is not guaranteed but worth asking.