Free-standing ERs driving cost and confusion in Colorado

The rapid proliferation of free-standing ERs — 20 have opened in Colorado since 2014 — is raising concerns in the medical and healthcare insurance communities. HealthTeamWorks recently caught up with Dorien Rawlinson, the Director of Mountain States Network Management for United Healthcare, to talk about some of the current trends and issues surrounding the accelerating establishment of free-standing ERs in Colorado.

HealthTeamWorks: Why are free-standing ERs on the radar of payers like United Healthcare?

Dorien Rawlinson: We are watching these healthcare providers closely because we’re seeing increasing utilization of their services by our customers. The demand is driven by the close proximity of these organizations to members and the perceived ease and flexibility of the services they provide. Since many of the new free-standing ERs we see popping up don’t take ambulance deliveries, wait times are often shorter. And without high-trauma cases, these ERs are viewed more convenient and more comfortable by those who visit them.

HealthTeamWorks: Why is this increased utilization a problem?

Dorien Rawlinson: This trend is concerning for a number of reasons. Patients often don’t fully understand that these facilities are true emergency rooms and not urgent care offices. Because they are not attached to a hospital and are more often embedded in retail areas, patients aren’t aware that the cost of care at these facilities can be extremely high. Colorado’s Center for Improving Value in Healthcare recently released a report comparing treatment costs for free-standing ERs and urgent care facilities, and the differences were startling. Making the problem worse is the position taken by these ER companies that they are prohibited from discussing treatment cost with their patients. The end result is that these facilities are driving up costs to an alarming degree; many free-standing ERs are out-of-network for patients, and they can often walk out of the facility with bills that easily reach into the thousands, or even tens of thousands of dollars to treat conditions like strep throat or flu that are not life-threatening and would be better served by their primary care physician.

HealthTeamWorks: Have there been attempts to educate patients about free-standing ERs?

Dorien Rawlinson: Yes, but they haven’t been very successful thus far. Earlier this year, the Colorado legislature defeated a bill to bring transparency to freestanding emergency room businesses by requiring these ERs to clearly post signage explaining the difference between their services and urgent care facilities and include information on treatment costs. The law failed in large part due to misunderstood concerns the ERs could be violating a law that was passed in the 1980s to prevent the practice of patient dumping.

HealthTeamWorks: What can primary care providers do to help the situation?

Dorien Rawlinson: There’s no doubt that the popularity of these facilities are bifurcating the relationship that patients have with their primary healthcare providers. It’s estimated that 80% of visits to free-standing ERs could be handled very effectively by primary care physicians. The important point to remember though, is that patients perceive that free-standing ERs are meeting a need for convenience. If primary care practices can address this dynamic by providing more flexible ways of access care, that’s a great place to start. Same-day appointment and virtual visits will definitely help, as well as maintaining an open dialog with patients to make them feel comfortable and more likely to reach out before visiting any ER facility. Knowledge is certainly power, and both providers and patients need to be fully aware of the consequences surrounding visits to free-standing ERs.