ClearchargeAmounts generally billed
If you qualify for a nonprofit hospital's financial assistance policy, there is a federal limit on what it may charge you — and that limit is based on what insured patients are generally billed, not on the hospital's list price. It is one of the few hard caps in American hospital billing, and one of the least known.
The short version. A nonprofit hospital may not charge someone eligible for its financial assistance policy more than the amounts generally billed (AGB) for emergency and other medically necessary care. The uninsured list price — usually the largest number on a bill — is off the table for anyone who qualifies.
Where the rule comes from
Section 501(r) of the Internal Revenue Code sets conditions a hospital must meet to keep its tax-exempt status. Alongside requirements to have a written financial assistance policy and to publicise it, it limits what such a hospital may charge patients who are eligible for that policy: no more than AGB for emergency and other medically necessary care, and less than the gross charge for other medical care.
This applies to nonprofit hospitals — the majority of hospitals in most states, but not government-run or for-profit ones, which are not bound by 501(r) even where they offer assistance by policy. Whether a given hospital is covered is shown on each hospital's page on this site, alongside its own published income thresholds where we have verified them.
How AGB is calculated
AGB is expressed as a percentage applied to the hospital's gross charges. Hospitals choose one of two methods and must state which in their financial assistance policy:
The look-back method
The hospital looks at claims it has actually been paid over a past period and works out what proportion of gross charges those payments represented. It may base this on Medicare fee-for-service alone, on Medicare together with private insurers, or on Medicaid — whichever it has chosen and disclosed.
The prospective method
The hospital estimates what Medicare and the patient together would be allowed to pay for the care, as if the patient were a Medicare beneficiary, and charges no more than that.
Either way the result is usually a small fraction of the list price. A hospital whose AGB percentage is 30% may not bill a qualifying patient more than $1,200 on a $4,000 gross charge, however that $4,000 appears on the initial statement.
Finding your hospital's figure
The AGB percentage and the method behind it must appear in the hospital's financial assistance policy, which it is required to publish and to make available free on request. In practice it is often a single line some way into a long PDF, phrased as "AGB percentage" or "amounts generally billed".
You can also simply ask, and it is a reasonable question to put to a billing office in writing: "I have applied for financial assistance. What is your AGB percentage, and which method is it based on?"
Start from the hospital list — each hospital's page carries its ownership type, whether it is likely required to offer assistance, and its published income thresholds where those have been verified against the hospital's own filing.
What AGB does not do
- It is not automatic. The cap applies to people who have been determined eligible under the hospital's policy. You generally have to apply. If you have not applied, the hospital is not breaking the rule by billing you more — see how to apply and what to say.
- It is not a discount you can negotiate to. It is a ceiling, not a price. Many people who qualify get considerably more than the cap — free care, or a much steeper discount — depending on income relative to the federal poverty level.
- It does not cover the doctor's bill. The surgeon, anaesthetist and radiologist bill separately, and a hospital's policy generally covers the hospital's own charges only. Ask each practice whether it has its own assistance policy.
- It is not the same as a price. Nothing here tells you what a procedure costs before you have it. For that, look up what hospitals publish.