Clearing Medical Debt: What Patients Should Know About Qualifying for Charity Care

A little-known federal program created with the Affordable Care Act says nonprofit hospitals have to offer free or reduced care to patients that are within a certain income range in order to keep their nonprofit status

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A nonprofit with Boston ties is helping low-income families across the country eliminate their medical bills.

Some hospitals will wipe out medical debt for people that have income that’s three times the federal poverty limit. That limit goes even higher based on the size of your family.

The problem is that many patients don’t even know they qualify.

Carlos Lujan came to Boston in 2020 to get his master’s degree, but that dream was shattered when he was diagnosed with Hodgkin’s lymphoma. 

At the time he didn’t have medical insurance and had to leave his job for treatment. Hospital bills started piling up.

“When I was getting my treatments for chemotherapy, they would tell me right away, you also need to talk to the billing department,” Lujan said.

Many Americans are burdened by medical debt. Consumer Reports has advice on what to do before you pay any bills to avoid potential scams.

They told Carlos he owed the hospital $3,000 dollars. Alone and thousands of miles away from his family in Mexico, he wondered how we was going to pay the rent and put food on his table.

That’s when someone in the billing department recommended he reach out to Dollarfor, a national nonprofit that empowers patients to wipe out medical bills.

“We help patients access these resources. We advocate on their behalf, fill out paperwork submitted to the hospital and get those medical bills to go away,” Dollarfor founder Jared Walker said.

He started Dollarfor back in 2015 after his family dealt with their own medical crisis.

As Walker explains it, they use a little-known federal program created with the Affordable Care Act that says nonprofit hospitals have to offer free or reduced care to patients that are within a certain income range in order to keep their nonprofit status. It’s called charity care.

“If you make under a certain amount of money, the hospitals will waive your medical bills,” Walker said.

Charity care varies from state to state and hospital to hospital.

For example, at Boston Medical Center, if your annual income is below $40,000, they will discount your bill 90%. But if you’re a family of four, your annual income moves up to $83,000. A family of five is $97,000.

“We're looking for organizations that are making a difference in health inequity, “ said Jim Bildner, CEO of the Draper Richards Kaplan Foundation.

He said Dollarfor caught the eye of the foundation, a global venture philanthropy firm with offices in Boston, Dallas, California and Africa. They’ve helped support more than 200 organizations through novel funding and support strategy.

DRK was able to help Dollarfor scale up to meet the need of more clients. To date they’ve eliminated over $211 million dollars in medical debt and the hope is to get that up an additional $150 million in the next three years.

“It's the greatest privilege of a life to know that you've made a difference in somebody's life,” Bildner said.

Lujan said that Dollarfor got his medical bill reduced from $3,000 down to $200. He said that helped him focus on his treatment. Now cancer-free, he’s living in Austin, Texas, and grateful for the help he received from Dollarfor, but upset at the broken medical system that caused him so much unneeded stress.

“I feel like sometimes it feels debt is more like a punishment,” said Lujan. “We're going to punish you for helping you out with you having to pay all of this when we didn't choose to be sick.”

Walker wishes Dollarfor didn’t have to exist, but is hopeful that their work will help more people like Lujan in the future.

“Hospitals are supposed to tell people about these programs. They don't. They get all the benefits of being a nonprofit. They get all these tax breaks,” Walker said.

If you’re dealing with medical debt and want to see if you qualify for charity care click here:

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