Patient dumping costs U.S. healthcare facilities millions in fines and penalties each year, with Medicare-participating hospitals facing increasing scrutiny over improper discharges and patient transfers.  

Skilled nursing facilities and post-acute care centers must understand both the legal framework and operational implications of patient dumping to protect their financial health and maintain strong referral relationships.

In this article, we'll cover:

• What patient dumping is, and why it happens

• The key rules and regulations around patient transfers and discharges

• Whether hospitals can deny care and other common compliance pitfalls

• Practical systems to prevent patient dumping while maintaining efficient operations

• Ways to strengthen your referral relationships through proper documentation

What is patient dumping?

When a hospital drops off an elderly dementia patient at a homeless shelter, or someone discharges a critically ill person without proper care arrangements, healthcare administrators call it "patient dumping."

This practice — refusing care or improperly discharging patients due to their inability to pay — creates serious risks for both patients and facilities. Healthcare staff sometimes refer to these cases as "frequent-user patients," "revolving-door patients," or "bed blockers."

These terms often mask a deeper problem: Patients who need ongoing care but lack the financial resources to access it properly.

Patient dumping vs. standard transfer

Healthcare facilities transfer patients every day for legitimate reasons — a patient needs specialized care not available at your facility, or they're ready to move to a lower level of care. But there's a clear line between appropriate transfers and patient dumping.

A proper transfer includes detailed documentation, confirmed acceptance from the receiving facility, and arrangements for safe transport. Patient dumping often skips these critical steps, putting both patients and facilities at risk.

Here's a clear breakdown of the differences:

|                Proper Patient Transfer                |                  Patient Dumping                 |
|:-----------------------------------------------------:|:------------------------------------------------:|
|       Medical screening completed and documented      |          Limited or no medical screening         |
|          Transfer based on medical necessity          |   Transfer based primarily  on financial status  |
| Receiving facility contacted  and confirms acceptance |      No confirmation from receiving facility     |
|          Complete medical records transferred         |       Incomplete or no medical records sent      |
|          Appropriate transportation arranged          |     Inadequate or no transportation provided     |
|            Follow-up care plan established            |          No follow-up care arrangements          |
|   Patient and family informed  and consent obtained   | Limited or no communication  with patient/family |
|       Clear documentation  of transfer rationale      |           Poor or missing documentation

Why does patient dumping happen?

Healthcare facilities face mounting pressures that can lead to patient dumping, even when administrators and staff want to provide the best care possible. Understanding these pressures helps identify better solutions that protect both patients and facilities.

Financial realities

The rise of patient dumping traces back to mounting pressures on our healthcare system. Between 1994 and 2005, emergency department visits jumped 18% to 110.2 million annually. This surge coincided with rising care costs and lower reimbursement rates from Medicare, Medicaid, and other payers.

The financial strain hit hardest at facilities serving low-income communities, where patients often rely on emergency rooms for primary care.

Insurance gaps and payment challenges

When patients lack insurance coverage, facilities often absorb the treatment costs. State-level cuts to Medicaid eligibility and benefits have worsened this problem. 

Bed availability crisis

The pressure to maintain occupancy with paying patients creates difficult decisions about resource allocation. This particularly affects emergency departments and mental health services. According to the National Alliance on Mental Illness:

• About 75% of ER doctors see patients needing psychiatric hospitalization on every shift.
  
  

• An estimated 83% of emergency departments lack an on-call psychiatrist.
  
  

• About 29% of doctors report patients waiting over two days for psychiatric beds.

What is EMTALA? 

The Emergency Medical Treatment and Active Labor Act (EMTALA) establishes critical rules for emergency medical care that protect both patients and healthcare facilities.

While originally created in 1986 to prevent hospitals from refusing medical treatment due to the costs for patients who couldn't pay, EMTALA has evolved into one of healthcare's most significant patient protection laws.

Your EMTALA obligations begin the moment a patient arrives at your facility seeking emergency care. This includes patients arriving by ambulance, walking into your emergency department, or even experiencing a medical emergency within 250 yards of your hospital property.

Contrary to what many believe, EMTALA's scope extends well beyond the emergency department — it covers your entire facility, including labor and delivery units, psychiatric facilities, and even hospital-owned urgent care centers.

Understanding your obligations

Once a patient arrives, your facility must provide an appropriate medical screening examination to determine if an emergency medical condition exists.

This screening must be consistent across all patients, regardless of their ability to pay. When an emergency is identified, you must either stabilize the patient's condition or facilitate an appropriate transfer if your facility lacks the necessary capabilities.

These obligations continue until one of these conditions is met:

• A physician completes screening and finds no emergency.

• The emergency condition is stabilized.

• The patient is admitted as an inpatient.

• The patient is appropriately transferred.

• The patient refuses care.

Can a hospital turn you away without treatment?

Under EMTALA, hospitals cannot refuse to provide a medical screening examination (MSE) to any patient who comes to the emergency department. However, there are a few specific conditions where a hospital may legally turn a patient away:

• If the patient does not have an emergency medical condition (EMC): If a physician or qualified medical personnel determines through an MSE that no emergency exists, the hospital is not required to provide further treatment​.
  
  

• If the hospital does not have an emergency department: Facilities like urgent care centers, outpatient clinics, and physician offices are not bound by EMTALA. However, hospitals without EDs must still have procedures in place for handling emergencies​.
  
  

• If the patient refuses treatment: EMTALA does not force patients to accept care. If a patient (or their legal representative) refuses treatment after being informed of the risks and benefits, the hospital's EMTALA obligation ends​.
  
  

• During a federally declared emergency waiver: In rare cases, such as natural disasters or public health emergencies, the federal government can temporarily waive EMTALA requirements​

Patient dumping laws and protections in other states

While EMTALA is a federal law, some states have additional protections against patient dumping. These laws may include stricter enforcement, additional fines, or expanded coverage for patients beyond emergency departments. 

Here are a few examples:

• California: The state enforces EMTALA violations through the California Department of Public Health (CDPH) and imposes additional penalties for patient dumping incidents involving homeless individuals.
  
  

• New York: The New York State Department of Health (NYSDOH) enforces EMTALA compliance and allows hospitals to manage patient surges while still meeting their legal obligations.
  
  Hospitals can use on-campus fast-track clinics to screen and stabilize patients before transfer, as long as EMTALA guidelines are followed. If a hospital improperly transfers a patient without stabilization, it remains liable under both state and federal regulations
  
  

• Illinois: Under the Hospital Emergency Service Act (210 ILCS 80), Illinois hospitals must comply with EMTALA and provide emergency care to any patient at risk of serious illness, injury, or death.
  
  This includes stabilizing treatment for conditions like ectopic pregnancy, preeclampsia, and pregnancy loss complications. Hospitals that fail to comply can face fines of up to $50,000 and additional penalties from the Illinois Department of Public Health.
  
  

• Washington: All hospitals with Dedicated Emergency Departments (DEDs) have to follow EMTALA and state-level hospital licensing regulations.
  
  Hospitals must provide medical screening exams (MSEs), stabilizing treatment, and appropriate transfers without discrimination based on financial status or other factors. Violations can lead to federal penalties and state investigations​.

Enforcement challenges

Even with EMTALA regulations in place, preventing patient dumping remains difficult. Emergency care staff often lack clear guidance on EMTALA requirements. Plus, enforcement varies by region — facilities closer to Centers for Medicare & Medicaid Services (CMS) offices face more scrutiny.

What happens if a hospital violates EMTALA?

When hospitals violate EMTALA, the consequences extend far beyond simple fines. The Centers for Medicare & Medicaid Services (CMS) follows a strict enforcement process that can devastate a facility's operations. Violations trigger a CMS investigation that can result in immediate jeopardy status, requiring rapid corrective action to avoid Medicare termination.

The penalties come in three levels:

First, financial consequences hit hard. Hospitals face fines of up to $50,000 per violation, with individual physicians potentially liable for penalties of up to $25,000.

These fines aren't covered by typical malpractice insurance, meaning they come directly from hospital or physician resources.

Second, and most serious, is the potential loss of Medicare funding. CMS can terminate a facility's provider agreement — essentially cutting off the critical flow of Medicare reimbursements that many facilities depend on for survival.

Even a temporary suspension can severely impact a hospital's financial stability.

Third, in cases of deliberate patient abandonment or extreme negligence, criminal charges may apply.

Who is most affected by patient dumping?

Patient dumping creates barriers to essential medical care for our most vulnerable community members. While the practice affects many groups, several populations face particularly severe challenges in accessing emergency care:

• Elderly patients and nursing home residents often encounter resistance during transfers between facilities. Many face denial of care when their Medicare coverage runs low or when facilities anticipate complex, long-term medical needs. This forces them into a cycle of emergency department visits without proper follow-up care.

• Mental health patients struggle to receive appropriate emergency services. Emergency departments typically lack psychiatric specialists and dedicated mental health resources. When these patients arrive in crisis, they may wait days for an available psychiatric bed or face discharge without proper mental health support.

• The homeless population confronts unique obstacles in emergency care. Without permanent addresses or reliable contact information, they often receive minimal care before being discharged back to the streets. This creates a revolving door of emergency visits without addressing underlying health needs.

• Uninsured and low-income patients regularly experience delayed care or inappropriate transfers. As hospitals face increasing financial pressures, these patients risk being transferred to public hospitals or receiving limited care based on their inability to pay.

Real-world examples of patient dumping

Hospitals under financial pressure sometimes make discharge decisions that put patients at risk. But when those decisions violate EMTALA or fail to coordinate proper post-discharge care, they create serious legal, ethical, and financial risks for healthcare providers.

Here are three cases that highlight the impact of patient dumping — and what could have prevented them.

Case Study 1: Discharging a mental health patient without long-term care

A hospital in Los Angeles discharged a schizophrenic patient with just a 30-day supply of medication and no long-term care plan. When the medication ran out, his delusions returned, and he became suicidal. It took six months before he was stabilized again through a community clinic.

What would have prevented this?

• Coordinating with skilled nursing facilities (SNFs) and mental health facilities for follow-up care.
  
  

• Ensuring Medicaid enrollment before discharge to cover continued treatment.
  
  

• Using billing software to track high-risk patients and flag those needing ongoing care.

Case Study 2: A hospital van drops off a paraplegic patient on Skid Row

In one of the most infamous cases of patient dumping, a paraplegic man was found crawling in the street after being discharged to Skid Row — still in a soiled hospital gown with a broken colostomy bag.

This happened despite legal requirements for safe discharge planning.

What would have prevented this?

• Better discharge training for hospital staff to ensure compliance with patient transfer laws.
  
  

• Partnering with SNFs and respite care centers to provide a safe discharge alternative.
  
  

• Electronic records tracking to confirm patients are discharged to appropriate care settings.

How medical facilities can prevent patient dumping 

While EMTALA mandates emergency treatment regardless of ability to pay, facilities can implement systems that protect both patient access and operational sustainability. Here's how to build a comprehensive approach to EMTALA compliance.

Proper billing and revenue cycle management (RCM)

Financial decisions made in the heat of the moment can lead to EMTALA violations. The goal is to have clear protocols before those moments arise.

Does your facility verify insurance coverage efficiently while providing immediate care? Are your staff clear on when financial considerations can (and cannot) affect treatment decisions? Do you have guidelines in place for admission decisions during a low census period when you have less staff? Setting up these guardrails helps you maintain both fiscal responsibility and proper care.

Improved patient care coordination

Patient transfers are high-risk moments — both for hospitals and for your facility. A poorly coordinated discharge can lead to EMTALA violations, readmissions, and gaps in care.

Building strong direct relationships with hospital discharge planners helps ensure smooth, compliant transfers. When hospitals know they can count on your facility to provide appropriate care, you become the first call — not the last resort.

Regular communication and clear transfer protocols help ensure patients arrive with complete records, necessary medications, and a plan for ongoing care.

Legal and compliance best practices

Staff training on EMTALA requirements forms the foundation of compliance. Beyond training, facilities need systems to track patient eligibility and document care decisions.

Technology companies like ExaCare now provide tools that integrate with your existing EHR systems to streamline these processes. By connecting your clinical and administrative workflows, your team can focus on patient care while maintaining proper documentation.

The role of billing software in preventing patient dumping

Maintaining EMTALA compliance while managing efficient operations requires sophisticated tools. ExaCare addresses this challenge by using AI to streamline and improve patient admissions for skilled nursing facilities and post-acute care centers.

Our software processes complex referral packets, extracting crucial clinical and financial information into actionable insights. By integrating with major platforms like WellSky and PointClickCare, ExaCare creates a centralized system for managing referrals and documentation.

This unified approach helps facilities:

• Make faster, more informed admission decisions.
  
  

• Maintain complete documentation for EMTALA compliance.
  
  

• Improve communication with referring hospitals.
  
  

• Process referrals efficiently while ensuring thorough clinical and financial screening.

Stop patient dumping before it happens with ExaCare

Facilities that engage in patient dumping risk can face serious legal and financial consequences — denial of care based on inability to pay violates EMTALA and can lead to fines, lawsuits, and loss of Medicare funding.

While EMTALA compliance and patient care present complex challenges, healthcare facilities have better options than ever to prevent patient dumping. The key lies in implementing systems that support both compliant patient care and sound financial operations.

ExaCare helps post-acute care facilities navigate these challenges by integrating with existing EHR systems to support faster, more informed decisions.

Here’s what we offer:

• AI-powered referral screener that reviews hospital packets in minutes, enabling quick and accurate admissions decisions
  
  

• Centralized referral management that brings all your sources into one platform
  
  

• Built-in analytics to help you track performance and optimize your referral relationships
  
  

• Automated insurance verification, expensive med alerts, and reimbursement analyses to guard your bottom line
  
  

• A unified communication hub to streamline decision-making with colleagues

Ready to see how ExaCare can help your facility? Talk with our team to learn more.

Schedule a demo.