What is a freestanding emergency center? And, is it something good for patients or not? Michael Booth reported on the spread of this concept in Colorado in his article in the Denver Post “The parent of metro Denver’s Exempla to open four micro-hospitals” (4/14/13). The feature that separates a simple urgent care clinic and a microhospital is the presence of a few patient rooms intended for short term “observation”.
These microhospitals exist to make money. They are not charity operations or an improvement on hospital care or low cost options. Patients with a high deductible insurance plans do think of the cost. And such facilities may be less expensive than a hospital emergency room but more expensive than an urgent care center and much more expensive than a primary care office.
Urgent care clinics are much less expensive than a hospital sponsored emergency room because they are not allowed to charge the “facility fee” — the fee allowed by Medicare and insurance companies to compensate hospitals for special equipment and staff for very sick patients. Any facility that must own expensive diagnostic equipment does shift the cost to all that visit even if they don’t use the equipment. Also, there is the tendency to over-utilize high tech equipment (because it makes money for the clinic).
What about those observation rooms? They are very expensive and usually billed by the hour ($50-$100 per hour) plus a cost for medications that may be astronomical. An observation room is helpful to provide time (at the patients expense) to wait for test results or to see if treatment is working (like for nausea). Generally, if a patient does not have a condition that warrants full hospitalization they should be able to manage at home. There are some social situations that prevent a patient from going home in which case outpatient observation may have a place — but not one that insurance will always cover.
Insurance companies vary in what they will pay for outpatient observation — often they exclude medication costs. If a patient has to take an ambulance ride it is best not to go to a freestanding ER because a second ambulance ride to an actual hospital may be needed. Ambulance transport usually costs between $600 and $2000 — not something to be duplicated.
The notion that microhospitals have providers present 24/7 is of course true. But those providers are ER doctors who have work to do in the emergency area, they work in shifts, and ER doctors are not accustomed to hospital type care — they are not hospitalists or surgeons or specialists as might be found at a true hospital.
People need to have primary care providers. A primary care doctor may see someone with acute illness fairly soon (like the same day). Often that is soon enough and certainly at much lower cost than any outside microhospital. But, if the provider is busy or not available urgent care or microhospital care are substitutes.
Are microhospitals good or bad for patients? They probably have little place in outpatient care. If a patient has a condition that medically requires intravenous medications or oxygen then hospital care is probably better and safer. A lower cost option for some people is care at an urgent care center that does not have all the overhead cost of a hospital facility.