A friend of mine opened a $2,000 hospital bill and did what many other West Virginians have been forced to do: swipe the credit card and hope for the best.
What she didn’t realize was that she may have qualified for her hospital’s charity care program — a program that could have wiped the slate clean.
Dobrinsky
She’s not the only one. Close to 180,000 folks in West Virginia are weighed down by medical debt. The situation is even worse in rural Appalachia, where a quarter of the population has at least one medical debt in collections. These figures represent more than just statistics; these are our neighbors, our families, our friends. Many individuals are pushed to the brink because of just one hospital bill.
The tragic irony? Much of this debt could have been prevented if hospitals fulfilled their obligation to provide charity care.
Every year, West Virginia's non-profit hospitals rake in millions of dollars in tax breaks. The arrangement was meant to be straightforward: in exchange, they serve the community by providing charity care to those who are unable to pay. Taxpayers foot the bill, and hospitals help families in need. The social contract.
But a new analysis at the Cardinal Institute shows that the contract is broken.
After analyzing federal data, IRS filings and hospital financial statements, Cardinal has documented a pattern in which hospitals provide minimal charity care while pursuing collections — even against patients they admit who qualify for financial assistance.
The numbers don’t lie, and they’re damning. Hospitals boast about $1 billion in so-called “community benefit,” a catch-all term that encompasses everything from Medicaid to community programs. But the heart of the non-profit deal is charity care: wiping out bills for those who can’t pay. West Virginia hospitals drop the ball.
On average, West Virginia’s big hospital systems spend less than 1% of their net patient revenue on real charity care — actual bill forgiveness. The rest of their so-called “community benefit” is padded with costs they’d have anyway, like Medicaid shortfalls. One system sent thirteen times more bills to collections than it forgave. During the pandemic, another system went so far as to garnish wages and raid bank accounts over unpaid bills.
Hospitals aren’t strapped for cash either. The major systems in West Virginia report healthy profits, millions in assets and ample revenue from commercially insured patients. The problem isn’t capacity — it’s priorities.
If you’re uninsured or underinsured, you could qualify for a hospital’s Financial Assistance Program, but most people don’t even know these programs exist. Hospitals aren’t required to lift a finger to screen patients for help.
When patients do qualify, hospitals may still pursue collections. Our review of IRS filings shows that hospitals routinely classify patients as likely eligible for their financial assistance policy but still send them to collections.
The human toll is significant. Medical debt isn’t just a ding on your credit. For families in rural Appalachia, it doubles the odds of falling behind on mortgage, car or student loan payments. A single hospital bill can send a family from solid footing straight into foreclosure.
Meanwhile, West Virginia ranks last in charity care oversight. No spending minimums, no audits, no penalties. Families are left defenseless while non-profit hospitals cash in on tax breaks.
But it doesn’t have to be this way.
Some states hold hospitals’ feet to the fire. Texas sets a 4% minimum for charity care. Illinois links hospital tax breaks to real community benefit. Oregon requires hospitals to screen patients for charity care before they can even consider collections.
These reforms work. Oregon’s biggest hospital saw charity care eligibility skyrocket from 12% to 64% after universal screening. When hospitals look for people who need help instead of waiting for desperate families to beg, a lot more folks get the relief they deserve.
West Virginia can — and should — do the same. Our research lays it out: set a minimum percentage of patient revenue for charity care (with bad debt, collections, and sold medical debt explicitly excluded), make hospitals report exactly how much they provide, ban sending FAP-eligible patients to collections, and require hospitals to screen everyone for financial help before billing. Moreover, transparency rules should separate real charity care from the bloated “community benefit” numbers hospitals love to pad.
But above all, West Virginia needs to scrap Certificate of Need laws. These rules force hospitals to beg the government for permission to open or expand, handing established systems a free pass from competition. Without real competition, hospitals have little motivation to offer charity care or competitive prices.
If hospitals want tax breaks and public subsidies, they need to earn them by delivering real community benefits. If they can’t — or won’t — they should lose their special status. Simple as that.
West Virginians are proud, self-reliant people. But pride doesn’t pay a hospital bill. Our families deserve better than to be steamrolled by medical debt while hospitals pocket tax breaks and toss out scraps of relief.
It’s time to hold hospitals to their promise.
Dobrinsky is chief of staff for the Cardinal Institute for West Virginia Policy.
