Aldeen’s Sunday Morning Bathroom Read – “NOPE”/RBR Plan Renewal Edition

By Doug Aldeen ERISA Healthcare Attorney and General Counsel

Sunday Morning Bathroom Read “Nope”/ RBR Plan Renewal Edition (second in an ongoing series):

Is a not for profit facility able to request charges upfront from a patient ( who has less than adequate insurance read: RBR) without first determining eligibility under their financial assistance policy prior to treating for medically necessary elective services?

Answer: Nope.

“Safe Harbor for Certain Charges in Excess of AGB

A hospital facility that charges a FAP-eligible individual more than AGB for emergency or other medically necessary care or gross charges for any other medical care will not fail to meet the requirements of Section 501(r)(4) if all of the following conditions are met.

The charge in excess of AGB was not made or requested as a pre-condition of providing medically necessary care to the FAP-eligible individuals (for example, an upfront payment the hospital facility requires before providing medically necessary care).

Limitation on Charges – Section 501(r)(5) | Internal Revenue Service (

Thoughts/Specific Recommendation:
400 % of the FPL for a family of four in FY 2023 is $120,000 (AGI) which is 87% of the US. Hundreds of millions of US households qualify either in whole or in part for financial assistance at 400% of the FPL. Every TPA/Plan Sponsor/ should be certain that each plan member’s HOUSEHOLD income box is checked (Gross and AGI). Put simply, as a condition of enrollment, you must provide household income supported by a joint tax return ( read: Hey- you need to provide a valid license to vote so it makes sense that you need a joint tax return to access health insurance appropriately)….

Food for thought.

100% of members of a 150 life case in the Lower Rio Grande Valley Texas meet the requirements for free (FAP) hospital care at Valley Baptist Hospital in Harlingen. Effective October 1, 2023 group plan will be excess cover to any available hospital FAP. As the Great Aldeeni has famously said, we are “helping hospitals achieve their charitable mission.”