Freestanding Emergency Centers Increase Healthcare Costs, Not Access

Freestanding emergency centers are not solving the cost of healthcare in Texas. They are multiplying it.

By locating primarily in areas with high incomes and multiple hospital-based emergency rooms and urgent care clinics, freestanding emergency centers increase the cost of healthcare. A recent study from Rice University found that for conditions that could be treated in an urgent care center, but were instead seen in a freestanding emergency center, the cost was more than 10 times higher. Blue Cross Blue Shield of Texas data shows that 75 percent of freestanding emergency center patients could have been treated in an urgent care center or doctor’s office at a much lower cost.

To increase profits, many independent freestanding emergency centers choose to stay out-of-network with insurance companies. Being out-of-network allows freestanding emergency centers to charge whatever they want for their services, leading to exorbitant bills to unsuspecting Texans.

Recently, a BCBS TX member went to a freestanding emergency center with a sore throat and was diagnosed with tonsillitis. The facility charged more than $45,000 for the visit.

Yet another of our members arrived to a freestanding emergency center with nausea and vomiting. The patient was diagnosed with stomach flu and was discharged. The bill for this visit? $51,000.

In circumstances like these, patients are often responsible for a large portion of the bill.  By choosing to remain out-of-network, freestanding emergency centers are able to bill the patient for the difference between what insurance pays and their inflated charges. That difference leads to the patient receiving a “surprise bill,” which can run in the thousands of dollars.

And make no mistake, these centers are choosing to remain out of network. In 2016, BCBS TX contacted all known out-of-network freestanding emergency centers in the state, hoping to bring their facilities into our network, to protect our members from surprise bills. The overwhelming majority of them declined to even look at our contracted rates, preferring to remain out of network.

This issue now has the attention of lawmakers in Austin, and eleven proposed laws have been filed to address complaints about the business practices of freestanding emergency centers.  Several proposed laws would require full disclosure and transparency of billing practices of freestanding emergency rooms, and two–SB 2064 by Sen. Hancock and HB 3867 by Rep. Smithee–would authorize the Texas Attorney General to take action in cases of “unconscionable pricing,” commonly called gouging. Contact your state senator or your state representative and ask them to support measures that will protect Texans from exorbitant charges at freestanding emergency centers.

It’s our responsibility at BCBS TX to provide our members access to quality, cost-effective healthcare. Texans deserve quality, affordable care with no surprises, and no unconscionable bills.

Dr. Paul Hain is North Texas market president for Blue Cross and Blue Shield of Texas and is a board certified pediatrician.

Posted in Expert Opinions.