Charity care is the price they have to pay to get the capital.
Non-profit hospitals obviously cannot go to the equity market to get resources for growth or restructuring. However, they can use tax-exempt debt that they access by offering bonds through a local or state finance authority. The authority will typically hold a hearing and enter into an agreement with the hospital. As part of the agreement the hospital is expected to provide community benefits. The amount of community benefit that a finance authority can require is limited by the cost of alternative sources of capital.