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Hospital Charity
Purchaser: Public and Private Hospitals
Program: Hospital charity care

Description: In the 1998 Texas Department of Health annual survey of hospitals, 428 hospitals reported providing about $2 billion in charity care. (This figure excludes state-operated hospitals and university hospitals.) These charity amounts reflect what the hospital charged. Analysts in this area often adjust these figures for the difference between what hospitals commonly charge and what they receive often in negotiated or discounted payments. Even when adjusted for the ratio of cost to charges, the figure is more than $1 billion for fiscal 1998.

According to the Texas Indigent Health Care and Treatment Act, public hospitals are required to provide indigent care where there is no hospital district. Unlike hospital districts, which set their own eligibility criteria, public hospitals must provide a minimum level of service to indigent clients and can not set eligibility criteria that are more stringent than those established for County Indigent Health Care Programs.

Nonprofit hospitals are exempt from taxes and are required to provide charity care. For-profit hospitals are not required to provide charity care, but may do so anyway.

In the hospital survey, 476 non-state operated hospitals reported nearly $2 billion in bad debt. When this amount is adjusted for the ratio of cost to charges, the figure is about $978 million. Some portion of this debt may include care given to low income, uninsured Texans. For hospital districts and other public hospitals, taxes may help cover some of these losses.

Hospitals also receive donations. In 1998, 135 hospitals reported receiving almost $76 million in donations, which were not donations for capital improvements.

Texas also has two Shriners hospitals. These hospitals provide charitable health care to children and are sponsored by the Shriners organization. (They are not included in the TDH survey.)

One of the Shriners hospitals is in Houston and the other is in Galveston. They spent $39.9 million on children in fiscal 1998.

Texas Total, Fiscal 1998
Hospital Charity Care $2,083,785,174 ($1,054,656,070 adjusted for the ratio of cost to charges)
Hospital Donations $75,999,263
Shriners Hospitals $39,900,000
Total Hospital Charity Care 1,170,555,333 (Includes Medicaid and other duplicated revenue like local taxes.)
Total unduplicated charity care $115,899,263

Source: Texas Department of Health and the Shriners