Minnesota lawmakers are struggling to sustain the state’s financially distressed hospitals with Charity care at Minnesota hospitals. This is as patients face mounting medical debt, and the number of uninsured residents continues to climb.
Charity care at Minnesota hospitals: Lawmaker seeks to redirect healthcare tax
One state lawmaker has proposed channelling money from an existing healthcare tax back to hospitals. This aims to expand charity care programmes for patients unable to pay their bills.
The proposal follows a News investigation. It found that hospitals across the state spend far less on charity care than hospitals in many other states.
The investigation also revealed that Minnesota hospitals use widely different standards to determine who qualifies for free or discounted care.
State Representative Steve Elkins said redirecting hospitals’ own tax contributions makes sense.
“Hospitals are providing a fair amount of charity care, but they kind of have an obligation to do something more than they are doing,” Elkins said.
Elkins cited recent reports from the Lown Institute and Minnesota’s legislative auditor. It showed that some hospitals receive more in nonprofit tax benefits than they spend on community benefits, including charity care.
However, Elkins noted that simply demanding more from hospitals may not provide the answer. Newly released financial data shows that 31 Minnesota hospitals meet the state’s definition of financial distress.
$205 million bailout looms for Hennepin County Medical Center
Hennepin County Medical Center (HCMC) in Minneapolis appears poised for a $205 million state bailout this year. It was meant to prevent the urban trauma centre from closing.
HCMC provided more charity care than any other Minnesota hospital in 2024, an estimated $88 million. This consumed more than three per cent of its operating budget.
Elkins said he suspects some other hospitals may be diverting their charity care patients to HCMC. It automatically screens patients for financial needs upon admission.
Incentivising hospitals to become more generous could ease pressure on HCMC, Elkins said. The state collects approximately $250 million annually from a 1.56 per cent tax on hospital patient revenue.
This figure roughly matches the $241 million that hospitals spent on charity care in 2024.
“You could pretty much make every Minnesota hospital whole with all of the charity care they’re providing,” Elkins said.
In 2025, the Newcastle Hospitals Charity received £200,000 from the NHS Charities Together’s Innovation Challenge Fund to support a project that helps young people in hospitals. The money will expand the SPACE Pilot project, collaborating with the Great North Children’s Hospital.
