It’s Time to Reform Free-Standing Emergency Rooms

According to data from the Centers for Disease Control, there were 130 million visits to emergency departments in 2020. Despite the significant number of visits to emergency rooms, not all visits occurred at traditional emergency departments, but rather at free-standing emergency departments not physically connected to a hospital. Between 2008 and 2016, the number of free-standing emergency rooms grew from 222 to over 566 across thirty-two states with the highest concentration in Texas and Ohio.

While these medical units routinely provide essential care to patients, patients often confuse them for cheaper urgent care units, leading to unexpected medical bills for minor illnesses and injuries that can quickly run into the thousands. While states should not outright ban these medical units, they should take legislative steps to ensure when patients visit these units, they do so fully aware that the unit is a free-standing emergency room and not an urgent care.

Unlike traditional emergency rooms, a free-standing emergency room is structurally separate from a conventional hospital but can “treat any of the conditions that a hospital-based E.R. could.” These units are also traditionally staffed round the clock with licensed physicians and nurses.

One of the most significant problems with free-standing emergency rooms is that patients often cannot distinguish between a free-standing emergency room and an urgent care. Like urgent care centers or walk-in clinics, free-standing  emergency rooms are usually located in “retail or neighborhood locations.”

Despite a legal requirement in most states that free-standing emergency rooms display “emergency” or “E.R.,” the fact remains thousands of Americans are still unknowingly receiving care at these units when more cost-effective providers are available.

For patients who only have minor illnesses or injuries, mistaking a free-standing emergency room for an urgent care or walk-in clinic can be extremely costly. A 2015 study estimated the cost of visiting a free-standing emergency room was $2,199 compared to $168 for a visit to an urgent care. This additional cost is generally because they provide patients with “a higher level of care, with 24/7 operations, sophisticated medical equipment like C.T. scan machines, and emergency trained doctors,” facilities unavailable at urgent care centers or walk-in clinics.

Further complicating matters, these free-standing emergency rooms often fail to disclose that they usually operate outside of insurance networks, further inflating patient costs.

Recognizing the profound consumer harm that is caused by the lack of transparency, some states have taken steps to reform them. The critical aspect of these reforms is that they balance the medical benefits they provide with transparency for patients. In 2019, the Texas legislature passed H.B. 2041 that required free-standing emergency rooms to provide “patients a printed-out disclosure in English and Spanish that lists the in-network health plans and the average price a patient may be charged for a procedure, including facility fees.”

Colorado also passed important reforms to free-standing emergency rooms. Colorado law requires free-standing emergency rooms to provide patients with a written notification that they are receiving care at “an emergency medical facility,” not an urgent care or walk-in clinic. Free-standing emergency rooms are also required to list “the specific health insurance provider networks and carriers with which the free-standing emergency department participates or states that the free-standing emergency department is not a participating provider in any health insurance provider networks.”

Florida has also taken steps to provide further transparency with free-standing emergency departments. The State House recently voted HB 1157 out of committee, and this bill would require free-standing emergency rooms to “clearly identify itself as a hospital emergency department, using, at a minimum, prominent lighted external signage that includes the word “EMERGENCY” in conjunction with the name of the hospital.” Inside, the free-standing emergency rooms must also display signage saying, “THIS IS NOT AN URGENT CARE CENTER. HOSPITAL EMERGENCY DEPARTMENT RATES ARE BILLED FOR OUR SERVICES.”

While it may seem easy to judge free-standing emergency rooms as deceptive, they often provide significant benefits to patients. Unlike traditional emergency rooms, free-standing emergency rooms often have shorter wait times and are often closer to patients. In a critical situation, this can be the difference between positive and negative health outcomes. These factors should be enough to show an outright ban, as is the case in California, is an overreaction that will deny patients access to care.  Giving consumers the right information necessary to make sound decisions is important. The examples of Texas, Colorado, and Florida show it is possible to create a regulatory environment that allows free-standing emergency rooms to continue providing services to patients without surprise bills. Other states should follow suit.

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