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July 27, 2010; Source: Indianapolis Star | This may be the kind of story that intensifies the scrutiny of charity care and tax exemption at nonprofit hospitals. The cost of care in Indianapolis and other Marion County, Indiana nonprofit hospitals can be very unhealthy to the financial well being of patients. According to findings from a survey conducted by the Consumer Action Coalition Education Fund and Indiana Legal Services, close to 50 percent of hospital patients are going into debt to pay their bills, and for some that leads to personal bankruptcy or foreclosed homes.

Even though their tax-exempt status requires them to provide charity care, hospitals aren’t doing enough to let people know about alternative payment options, say patient advocates. “Medical debt is a very large problem in this city (Indianapolis),” said Beryl Cohen, the study’s author and project director for the Citizens Action Coalition Education Fund. “We’re not just talking about poor people or people who are uninsured.”

The Indianapolis Star, which reported the survey findings, said they were similar to those highlighted in the newspaper’s 2008 investigation.  Their examination found that each of Central Indiana’s four major nonprofit hospitals spent less than 3 percent of revenue for charity care in 2006. The Star reports that hospital officials dispute many of the survey’s findings and say charity care statewide is better than the findings suggest.  Still, patient advocates say hospitals can do a better job, especially in letting patients know about charity care and financial assistance. Other suggestions include payment plans that take into account patients’ income and expenses. —Bruce Trachtenberg