It is hard to believe that it has come to this point. I learned something last week that I find both amazing and appalling. Something you would not expect in a Democratic Republic. In a formerly free nation founded on Judeo-Christian principles, it is almost unfathomable. And it is something that may hold ramifications for workers’ comp.

Under Obamacare, non-profit and religious based hospitals that are determined, by government bureaucrats, to be giving TOO MUCH charitable care to uninsured individuals will risk steep fines and the loss of their 501(c)3 status.

I will wait a moment for the stunned silence to pass.

Under provisions of the Affordable Care Act, non-profit hospitals who maintain charitable care as part of their mission will be limited as to how much free care they can provide. This will apply to both privately held hospitals as well as publicly owned, taxpayer supported facilities.

According to Section 501 of the Internal Revenue Code, tax-exempt hospitals will have to complete a “Community Needs Survey” every three years, and file it along with  additional reporting requirements with the IRS . They must prove that charitable care is still needed by the community they serve, with the standards of “need” being defined by Obamacare and the IRS. Hospitals found to be in violation of the charitable care provisions can be fined up to $50,000, and lose their 501(c)3 status.

Experts believe this will have the net effect of putting more hospitals into a for-profit category and will produce more taxable revenue for the federal government.

I understand the intent of these punishing provisions. Obamacare needs mass numbers of insureds to have a prayer at working. Removing that “free” care from those who have been getting it helps push them to buy insurance when they otherwise would not. Still, the notion of government oversight on what organizations may choose to “donate” undercuts some of the very tenets of our society.

Of course, if you believe that no charity should ever be tax deductible, then this will not be a problem for you.

This action will not hurt the very poor; those on welfare or covered by Medicaid. It will be a direct hit on this nations working poor, those that fit the lower rung guidelines for subsidized care under the Obamacare exchanges. Households with income between 100 percent and 133 percent of the Federal poverty level will have insurance premiums capped at 2 percent of annual household income. The cap increases on a scale until it maxes out at 9.5 percent for those households making between 300 percent and 400 percent of the poverty level.

For example, in 2013, an individual living in the continental U.S. who makes $11,490 a year is at 100% of the Federal Poverty level. For a family of four, they would need an annual household income of $23,550 to be at 100% of that level. These people, by law, must buy health insurance starting in 2014, and their premiums may not exceed 2% of their total income. The remaining will be subsidized by the Federal government. Our individual in this scenario will only have to pay $230 a year for insurance; our family of four, $471 – a veritable bargain by all accounts.

I submit to you, perhaps naively so, that a family of four making $23,550 a year likely does not have $471, and now an avenue for free care may be closing at the behest of a government claiming to be acting in their interest.

As I have written before when discussing potential failures of Obamacare, when one door to medical coverage and care closes, the door to workers’ comp could be pushed wide open. We already know that some people making claims under workers’ comp are doing so because it is the only avenue for care they have. That pool will only increase if charitable avenues are cut off, particularly for the largest at risk group, this nation's working poor.

For years we have been inundated with the news that no uninsured can get healthcare in this nation. We have been bombarded with stories of families deprived of the “basic right” to healthcare. In reality those stories have been few and far between. More often the story was about care delivered and received, but was financially ruining all the same. In many cases, charitable care saved the day.

That may now change, and ironically people who at one time had been able to get care, the people most likely to need assistance, will not be able to do so once “affordable care” becomes the full law of the land. Those most at risk, ironically, are the working poor, as those who do not work have more government assistance available to them. In the end result, with charitable care blocked by the very government that claims to “fight for them”, workers’ compensation may be the only insurance and medical coverage these people have access to. 

Leave a Reply

Your email address will not be published. Required fields are marked *