Hospitals have made more money, spent less on charity care under ObamaCare


Supporters of the Affordable Care Act have often cast it as a blow against greedy companies in the health-care industry that are more concerned with their bottom line than Americans' wellbeing. It's a narrative significantly complicated by health insurance companies' experience of a "profit spiral" of rising income since ObamaCare went into effect and, now, a new Politico report which finds nonprofit hospitals have made more money and spent less on charity care, defined as "free treatment for low-income patients," since 2013.
The upshot, as Politico summarizes, is the "top seven hospitals' combined revenue went up by $4.5 billion per year after the ACA's coverage expansions kicked in, a 15 percent jump in two years. Meanwhile, their charity care — already less than 2 percent of revenue — fell by almost $150 million per year, a 35 percent plunge over the same period."
This happened, Politico reasons, because the ACA produced about 20 million new paying customers for hospitals nationwide while maintaining a system of tax exemptions, established for half a century, in which the hospitals pay lower taxes on the condition that they can demonstrate service to their communities, usually through the charity care. So post-ObamaCare, many not-for-profit hospitals have higher incomes, significantly in the form of tax dollars via the Medicaid expansion's shifting patients out of the charity care programs, but receive the same tax benefits as they did pre-ObamaCare.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Read the full Politico report here.
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Bonnie Kristian was a deputy editor and acting editor-in-chief of TheWeek.com. She is a columnist at Christianity Today and author of Untrustworthy: The Knowledge Crisis Breaking Our Brains, Polluting Our Politics, and Corrupting Christian Community (forthcoming 2022) and A Flexible Faith: Rethinking What It Means to Follow Jesus Today (2018). Her writing has also appeared at Time Magazine, CNN, USA Today, Newsweek, the Los Angeles Times, and The American Conservative, among other outlets.
-
El Palace Barcelona: old-world luxury in the heart of the city
The Week Recommends This historic hotel is set within a former Ritz outpost moments from the Passeig de Gràcia
-
The best history books to read in 2025
The Week Recommends These fascinating deep-dives are perfect for history buffs
-
July 4 editorial cartoons
Cartoons Friday’s political cartoons include the danger of talking politics at a family picnic, and disappearing Medicaid entitlements
-
Dollar faces historic slump as stocks hit new high
Speed Read While stocks have recovered post-Trump tariffs, the dollar has weakened more than 10% this year
-
Economists fear US inflation data less reliable
speed read The Labor Department is collecting less data for its consumer price index due to staffing shortages
-
Crypto firm Coinbase hacked, faces SEC scrutiny
Speed Read The Securities and Exchange Commission has also been investigating whether Coinbase misstated its user numbers in past disclosures
-
Starbucks baristas strike over dress code
speed read The new uniform 'puts the burden on baristas' to buy new clothes, said a Starbucks Workers United union delegate
-
Warren Buffet announces surprise retirement
speed read At the annual meeting of Berkshire Hathaway, the billionaire investor named Vice Chairman Greg Abel his replacement
-
Trump calls Amazon's Bezos over tariff display
Speed Read The president was not happy with reports that Amazon would list the added cost from tariffs alongside product prices
-
Markets notch worst quarter in years as new tariffs loom
Speed Read The S&P 500 is on track for its worst month since 2022 as investors brace for Trump's tariffs
-
Tesla Cybertrucks recalled over dislodging panels
Speed Read Almost every Cybertruck in the US has been recalled over a stainless steel panel that could fall off