As I explained in a previous post, the New Jersey Hospital Care Payment Assistance Program, commonly called “Charity Care,” is a state program for New Jersey Residents with low income and resources who have no health insurance and are not eligible for programs like Medicaid and NJ FamilyCare.

There are many people in New Jersey who have no insurance or health benefits and who cannot afford to pay for the medical care they receive from hospitals while they are an in-patient or out-patient. Hospitals in New Jersey that provide general care are forbidden by law from turning away patients because the patients do not have health insurance or because they are not able to pay for their care. Those needing hospital care who lack medical insurance or sufficient assets to pay the hospital bill may be eligible for Charity Care.

Many public benefit programs attempt to recoup from beneficiaries amounts paid on the beneficiaries’ behalf by filing a lien against assets the beneficiaries may own or acquire in the future. Does Charity Care assert a lien against recipients to recover the costs of care?

Pursuant to N.J.A.C. 10:52-11.14,

Persons determined to be eligible for charity care shall not receive a bill for services or be subject to collection procedures. Persons determined to be eligible for reduced charge charity care shall not be billed or subject to collection procedures for the portion of the bill that is reduced to charity care.

Therefore, assuming that Charity Care was properly granted, it appears that no Charity Care lien would be asserted.

Anecdotally, I have discussed this issue with a colleague who had a concern regarding whether a charity care lien could be asserted against the estate of a decedent who had received Charity Care during his life. She contacted Charity Care and spoke to a representative who confirmed that, in the absence of fraud or misrepresentation, once a Charity Care application is accepted and paid, there will not be a lien asserted, and that, unlike other state agencies, Charity Care does not assert estate liens on beneficiaries, even if there is money left in an estate.

I confirmed this information by speaking to a program administrator with the N.J. Department of Health, Charity Care Unit. The program administrator confirmed that the State of New Jersey has never asserted a lien against a recipient of Charity Care to recover the cost of care provided. In addition, the administrator also told me that the private hospitals providing the care do not file any liens against recipients of Charity Care. Although the health care providers are obligated under statute to attempt to collect reimbursement of the costs of care, in reality little if any reimbursement attempts have ever been initiated by the providers. The reimbursement obligation itself is set forth in rather oblique language in N.J.A.C. 10:52-11.5(e) as follows:

Hospitals shall make arrangements for reimbursement for services from private sources, and Federal, state and local government third party payers when a person is found to be eligible for such payment. Hospitals shall collect from any party liable to pay all or part of a person’s bill, prior to attributing the services to charity care except in the situations described in (h) and (i) below. The hospital shall, as part of this obligation, pursue reimbursement for the uncollected copayments and deductibles of indigent participants in Title XVIII of the Social Security Act (Medicare). Hospitals shall report any amounts collected from any third party as a charity care recovery. Beginning July 1, 1995, charity care availability for persons with health insurance shall be subject to Federal disproportionate share rules. (Emphasis Added)

Thus, neither Charity Care nor any health care provider has asserted a lien or attempted to recoup the costs of care provided to Charity Care recipients.