Dear Administrator: Charity Care

DAL: HCBC 07-13
Subject: Charity Care

Dear Administrator:

The purpose of this letter is to clarify and confirm Health Department policy and regulatory interpretation as applied to payments to Certified Home Health Agencies (CHHAs) from the Bad Debt/Charity Care (BDCC) Pool as authorized pursuant to Public Health Law (PHL) § 3614(5). Regulations controlling the computation of these payments are contained in 10 NYCRR Part 86-1.47. In addition, 10 NYCRR 763.11(a)(11) imposes a minimum 2% charity care expenditure standard on non-public CHHAs (3 1/3% for public CHHAs) in order to qualify for any BDCC payments under PHL § 3614(5).

The Department has historically relied on the certified cost report data as annually submitted by each free-standing CHHA, to compute the payments authorized under 10 NYCRR 86-1.47. However, prior to the 2003 cost year the Department utilized non-certified data contained in the DOH-519 form, as submitted annually to the Department, to determine provider threshold eligibility under the 2% and 3 1/3% charity care expenditure standards. Commencing in the 2003 and 2004 rate years this changed and the Department started utilizing the certified cost report data to determine threshold eligibility for these payments as well to compute the payment amounts. Objections were raised concerning this change in policy and payments under this program for subsequent years have been held in abeyance while a review of the matter was conducted. That review has now been completed and the revised policy has been confirmed as lawful and appropriate. The Department's Bureau of Long Term Care Reimbursement will therefore proceed to issue BDCC payments in accordance with this policy for all periods subsequent to 2004

The definition of charity care required to be utilized by CHHAs in completing their annual cost reports, which is consistent with the definition of charity care as outlined in 10 NYCRR Section 763.11(a)(11), reads: Charity care is provided at no charge or reduced charge for the services the agency is certified to provide to patients who are unable to pay full charges, are not eligible for covered benefits under Title XVIII or XIX of the Social Security Act, are not covered by private insurance, and whose household income is less than 200 percent of the federal poverty level. Providers are reminded to carefully conform their charity care expenditure reporting, in both their cost reports as well as in the DOH-519 form, with this definition. Any previous guidance issued by the Department which is or may be understood as inconsistent with this definition of eligible charity care should be disregarded. Only those services that meet the above quoted definition may be employed to determine compliance with the charity care requirements as established by regulation.

Please also note that hospital-based CHHAs will continue to have their eligibility and payment computations based on the data contained in their DOH-519 forms until such time as the hospital cost report forms can be amended to provide for the collection of the necessary BDCC care data. The definition of charity care quoted above should also be used by hospital-based CHHAs when reporting charity care expenditures in their DOH-519 forms. Any previous clarifications to the definition of charity care issued by the Department in the completion of this form are no longer applicable.

Any questions regarding this DAL should be submitted in writing to Chris Gimbrone, Division of Home and Community Based Services, 161 Delaware Avenue, Delmar, N.Y. 12054.


Mark Kissinger
Deputy Commissioner
Office of Long Term Care