Report: Spending on emergency room fees on the rise as hospitals code more visits as severe

stethoscope, coins and calculator
Emergency room fees have grown by $3 billion over the past decade. (Getty/mckare)

Spending on emergency room fees has increased steadily over the past several years, in part because hospitals are more likely to code visits as severe, according to a new report. 

Vox and the Health Care Cost Institute analyzed 70 million bills for ER visits recorded between 2009 and 2015, and found that spending on ER fees increased by $3 billion over that window. This is despite the fact that the analysis found a slight dip (2%) in the number of ER fees billed during that same time frame.  

"It is having a dramatic effect on what people spend in a hospital setting," Niall Brennan, the institute's executive director, told Vox. "And as we know, that has a trickle-down effect on premiums and benefits." 

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Price-gouging in the ER is a problem across the country, particularly for minorities and the uninsured. A recent study, which was based on 2013 data, found that ERs charge on average between 1 and 12.6 times what Medicare pays for emergency care. The markups create total bills that were 340% more than what Medicare would cover; ERs were charging $4 billion versus $898 million in Medicare allowable amounts. 

The Vox analysis found that the number of ER visits coded as severe is also on the rise. Ashley Thompson, senior vice president for public policy at the American Hospital Association, told the publication that's likely due to an aging population. 

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However, there is limited oversight on what severity levels mean, and trips to different ERs for the same condition could yield different definitions, according to the article. The federal government tried to simplify severity billing codes in early drafts of the Affordable Care Act, but those provisions were killed following widespread backlash from providers. 

Robert Derlet, M.D., professor emeritus of emergency medicine at the University of California, Davis, told Vox that hospitals are able to take advantage of a "monopoly" on emergency care to set their own prices. 

While hospitals may have a financial incentive to jack up ER costs, another piece of the cost puzzle is that emergency room doctors have limited knowledge of how much services cost patients. A recent survey of almost 450 ER docs found that 62% could not accurately estimate the costs of care.