Opening your mailbox to a surprise bill of any kind isn’t typically a welcome experience. But when that bill is for thousands of dollars in medical care you once paid significantly less for, it’s even worse. Yet, that’s a scenario happening to more consumers as hospitals continue to contract out emergency room staffing, and one company appears to be driving the majority of costs.
The New York Times, citing recent research from Yale University, reports that hospitals turning to emergency room staffing company EmCare have are seeing a significant increase in patients’ medical bills.
Often these patients were seeking medical care at an in-network hospital where their insurance was accepted. But instead of having their costs covered, the doctors who saw them were out-of-network, resulting in surprise medical bills.
To make matters worse, the Times reports that much of the care these patients received was considered an expensive level, driving up costs.
While the Times report and the Yale study provide a wealth of information not only on EmCare, but surprise medical billing, here are four things we learned.
1. A Significant Increase
Shortly after a Spokane, WA, hospital switched to EmCare last year in order to fill vacancies on its emergency room staff, the facility began receiving calls from patients about their medical bills.
While the hospital’s most expensive level of care once cost patients $467, under EmCare the price increased dramatically to $1,649, the Times reports.
Overall, the hospital found that after EmCare brought in doctors and took over staffing and billing, the percentage of patients receiving the highest-level billing code — which is the most expensive — rose from 6% to 28%. The facility says it has since taken back control of billing.
“The billing scenario, that was the real fiasco and caught us off guard,” Tom Wilbur, the chief executive of Newport Hospital, tells the Times. “Hindsight being 20/20, we never would have done that.”
2. Not An Isolated Incident
Research released by Yale University Monday suggests that the experience of the Washington state hospital is much like that of other facilities using EmCare.
The study, which examined out-of-network doctor’s bills for one large, unnamed insurance company, found that out-of-network rates for customers of the insurer jumped to nearly 100% after EmCare came on board at their hospitals.
Of the 16 hospitals that EmCare began working in between 2011 and 2015, the researchers found that eight saw out-of-network billing rise quickly.
Likewise, when the researchers looked at a larger sample of 194 hospitals using EmCare the average out-of-network billing rate was 62%.
The researchers’ analysis found that while the average out-of-network billing for a hospital increased from just above 0% prior to EmCare’s entrance, after the number of such bills increased to nearly 80%. At the same time, however, the study found that admissions and highest-level billing codes saw minimal increases.
3. A Small Number Of Contributors
The significant increase in out-of-network billing costs suggest that unlike other emergency room staffing companies, EmCare did not sign contracts with the insurance company dictating prices. If this is the case, doctors are free to bill customers what they want.
While the issue of out-of-network billing is nothing new, the Yale report found that most of these surprise bills were connected to just a few hospitals, not evenly dispersed around the U.S., the Times reports.
Additionally, the report found that most hospitals of the hospitals contributing to out-of-network bills were staffed by EmCare.
For its part, EmCare tells the Times that the Yale study is “fundamentally flawed and dated,” adding that when the company begins work for a hospital, it allows the facility to treat skier patients, which contributes to increases in costs and billing.
The company also notes that it is working to reach agreements with insurers for most of its doctors, a move that could decrease some out-of-network costs.
4. Costs Vs. Patients
The Times reports that EmCare isn’t the only staffing company tied to a rise in out-of-network billing.
When competitor TeamHealth took over the emergency room departments at hospitals, researchers found an increase in out-of-network billing, albeit smaller than the increases tied to EmCare.
Not all of the out-of-network billing blame can be passed on to EmCare and companies like it, the Times reports, as analysts note that many hospitals are benefiting from such arrangements.
The Yale study found that facilities most commonly benefiting from using EmCare and the increase in billing were for-profit organizations.
Additionally, many hospitals contend that by contracting with companies like EmCare they are able to avoid the headaches of billing and scheduling, and can concentrate on other matters.