RD412 - Certificate of Public Need Related Charity Care Valuation – November 1, 2018

Executive Summary:

In accordance with the requirements of § 32.1-276.5 C of the Code of Virginia, as well as the requirements of the second enactment clause of HB2101 of 2017, the Virginia Department of Health (VDH), in conjunction with Virginia Health Information and with the assistance of the Virginia Hospital and Healthcare Association and the Virginia Association of Health Plans, collected data comparing the amount of charity care reported by inpatient hospitals and outpatient providers for the period from July 1-December 31, 2017. VDH calculated value based on Medicare payment rates for northern Virginia, a requirement outlined by the new law. VDH then compared these data to the data in “Reports of Compliance" submitted by providers for the period January 1, 2017-December 31, 2017. In Reports of Compliance, providers report the value of care at the facility’s gross patient charge rate.

Statewide, 7.7% of inpatient and 9.8% of outpatient providers were subject to some level of charity care. When valued based on Medicare payment rates for northern Virginia, the total care and charity care were substantially lower than the value of the care based on gross patient charges at a particular facility. The gross charge value of charity care, inpatient and outpatient combined, was $1,969,791,507. The reported care, annualized for comparison, valued at Medicare rates, was $713,154,100.