12% to 64%: What Happened When Oregon Hospitals Had to Offer Help Before Sending the Bill
Most hospital financial aid works the same way across America. The discount exists on paper, tucked behind an application form on page 4 of the billing portal, and the patient who just came home from an emergency appendectomy has to know to ask for it, find the form, and prove she qualifies before the bill goes to collections.
Oregon tried something different. A state law that took effect in July 2024 told hospitals to skip the application for nearly everyone. Screen patients automatically. Apply any aid they qualify for before the bill goes out. Then tell them.
Tradeoffs and KFF Health News looked at the first year of data, and the numbers are hard to ignore.
At Oregon Health & Science University, the share of patients getting financial assistance jumped from 12% to 64% in the early months of the law. Across roughly two-thirds of the state's hospitals with federal data, spending on free and discounted care more than doubled in the first full year. As a share of operating expenses, it rose from 1.4% to 2.7%.
The eligibility rules didn't suddenly turn generous. The paperwork disappeared.
Here's the detail that should stop every insured family in its tracks. Some of the biggest beneficiaries were people who already had health insurance. OHSU's financial aid for insured patients reached about $39 million in the first year, roughly 5 times what it had been before. Prior to the law, the hospital's own former chief financial officer noted, insured patients rarely applied for charity care. They assumed insurance meant they didn't qualify, so they put their $2,000 or $5,000 deductible on a credit card and paid it off a little at a time. Automatic screening wiped out or shrank what many of those insured families owed.
When the price is opaque and the relief requires a form, the billing department keeps whatever the patient doesn't know to ask for.
Then came the pushback. OHSU spent about $64 million on free and discounted care that first year, around 1% of its operating costs. "It is a good thing, but it is an expensive thing," the former CFO said. Hospitals lobbied the legislature, and in April lawmakers dialed the rule back. Insured patients are now screened automatically only if they owe more than $1,500 for a single visit or stay, up from $500. Patients with smaller balances are back to filling out an application.
The chairman of the Oregon House health committee put the trade-off in plain English: "I've got to make it more expensive for someone to get healthcare so that the hospitals can stay in business. What a country."
Hospitals have real payrolls and real margins to protect, especially in smaller communities. Still, consider what that legislative bargain admits. Financial assistance was only affordable for the system as long as four out of five eligible patients never found the form.
Direct primary care starts from the opposite premise. You shouldn't need a state mandate or a stack of tax returns to pay a fair price at the doctor's office. At AtlasMD our prices are posted on the wall. The monthly membership is the same flat number every month, labs cost a few dollars, and generic medications are dispensed near wholesale. There is no charity-care application because there is no inflated chargemaster price to discount.
A primary care membership won't erase a surgical bill after an appendectomy; you still want catastrophic coverage for the hospital. What it does is keep your everyday visits, blood work, and prescriptions out of the hospital billing machine altogether. And when you do end up in an inpatient bed, you have a physician in your corner who knows to tell you: ask for the financial screening before you write the check.
Oregon proved something simple. When you take away the paperwork barrier, 64% of eligible patients get the help they were promised on paper all along.
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