KershawHealth Simplifies Charity Care Policy

At its meeting on August 25th, the KershawHealth Board of Trustees voted to revise the healthcare system’s financial assistance policy. This policy establishes the criteria for providing discounts to uninsured or underinsured patients who do not have the financial means to pay for medically necessary healthcare services.

Eligibility for financial assistance is calculated based a patient’s annual income above Federal Poverty Guidelines (FPG). FPG is widely used to calculate eligibility for any number of assistance programs in the United States. Prior to the adoption of the new policy, adjustments to patients’ bills were based on a sliding scale from 100% to 50% of the bill and 100% to 400% of FPG. The simplified new policy allows for 100% adjustment of bills for patients with incomes up to 138% of FPG. In other words, qualifying patients would not have to pay any portion of their bills. Co-payment requirements for KershawHealth employed physicians, Emergency Department, and Urgent Care are excluded from the discounted charges.

Commenting on the new policy, KershawHealth CEO Terry Gunn noted, “We project our annual charity care write-offs for the current fiscal year will be in the range of $15.7 million. Ironically, this level of write-offs threatens the sustainability of our mission to care for all the patients who come to us. And so we have to find the right balance between honoring our mission and remaining financial viable. We believe the new policy achieves that balance.”

In his presentation to the Board of Trustees, KershawHealth Executive Vice President Chief Operating and Chief Financial Officer Mike Bunch noted that the new policy is in line with the policies in place at other hospitals and at community clinics in the area. According to Bunch, hospitals are revising their charity policies in response to implementation of Health Insurance Exchanges as part of the Affordable Care Act. Through these exchanges, people above 138% of FPG now have options for more affordable health insurance.

KershawHealth’s new policy is expected to reduce charity care write-offs by $2.1 million, some portion of which will be offset by increases in bad debt.

For more information about KershawHealth’s new charity care policy, contact Lisa McCaskill in Patient Financial Services at 803-713-6595. Patient Financial Services can also provide guidance in navigating the Health Insurance Exchanges.