Gov. Janet Mills (D) signed a bill into law earlier this month that expanded eligibility for free hospital care, raising the income threshold below which no-cost treatment must be provided by hospitals throughout the state. These changes are set to take effect next July.
While this level is currently set at 150 percent of the federal poverty level — equivalent to $23,500 this year — this will increase to 200 percent of the federal poverty level next year. Based on this year’s numbers, this would mean that anyone making less than $31,300 would be eligible for free care.
The new law, LD 1937, also simplifies the application process for charity care and requires that hospitals provide information on the availability of free care to patients.
Additionally, hospitals will be required to cap monthly payments for those who make less than 400 percent of the federal poverty level at 4 percent of their income. Using 2025 data, those making less than $62,600 would be eligible for this program.
A Maine Monitor analysis of data from the Maine Health Data Organization revealed that hospitals in the state provided nearly $60 million worth of charity care in 2023.
Uncompensated care — which also includes hospital bills that were issued but went unpaid — totaled $218 million that same year.
It has been predicted by some that as many as 34,000 of the 400,000 people currently on MaineCare could be dropped from the taxpayer-funded insurance in near future as a result of the changes advanced in the Big Beautiful Bill earlier this year.
The Center for American Progress, a liberal think tank, has estimated that uncompensated care costs could increase by $86 million in 2034 as a result of the Medicaid changes included in the bill.
The establishment of work requirements for certain Medicaid recipients has perhaps been one of the most hotly debated elements of the bill’s reform efforts both leading up to and since the bill’s passage.
Excluded from these requirements would be seniors age 65 and older, as well as pregnant women and parents.
In order to be maintain eligibility for Medicaid under this bill, non-exempted individuals would need to work, volunteer, or go to school for at least 80 hours per month.
[RELATED: Northern Light Health Signals Staffing and Program Cuts Imminent Amidst Financial Struggles]
Maine’s changes to charity care thresholds also come as some of Maine’s hospitals are already struggling financially.
Most notably, Northern Light Health signaled earlier this summer that it would be taking steps to reduce costs as it faces millions of dollars in losses, including reductions in personnel.
Northern Light Health said in June that it would be pursuing staffing cuts and leaving some positions unfilled in response to their current financial strain.
According to Northern Light Health’s executive vice president Paul Bolin, the health care system lost $150 million just last year.
At the end of 2024, Northern Light carried $617 million worth of debt, up significantly from $443 million at the end of 2023.
According to the Maine Monitor, Northern Light Health recorded about $12.1 million in charity care and about $26 million in bad debt last year.
Despite these financial struggles, a Republican-led bill to ensure that Maine hospitals are reimbursed in a timely manner for services provided to MaineCare patients stalled at the close of the most recent legislative session.
Although the bill got off to a rocky start in the House, it ultimately passed both chambers by substantial margins in strongly bipartisan votes. The proposal was stalled, however, when it came time for lawmakers to decide whether or not to approve the funding for it.
After failing to decide one way or another before the Legislature adjourned sine die last month, the bill was carried over to the next special or regular session.
Earlier this summer, Gov. Mills signed a separate bill into law, this one prohibiting medical debt from being incorporated into Mainers’ credit scores.
Although State Law currently has some restrictions on the treatment of medical debt, this bill completely blocked it from being included on credit reports.
[RELATED: Medical Debt Will No Longer Factor In to Credit Scores]
Under this bill, “a medical creditor, debt collector or debt buyer may not report a consumer’s medical debt to a consumer reporting agency.”
This law mirrored changes that took place at the national level in January, as the Consumer Financial Protection Bureau (CFPB) prohibited creditors from considering medical debt and other medical information when calculating a credit score or making loan approval determinations.
The net impact of these varying elements on the financial well-being of Maine’s hospitals remains to be seen in the coming years.
