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Freestanding emergency rooms threaten health of Texas business

By Amanda Montagne Martin - Guest Column
Dec. 21, 2016 at 7:18 p.m.

Amanda Martin

Amanda Martin

Texas' well-deserved pro-business reputation is being threatened by rising health care costs. Texas - along with Wisconsin - spends more per capita on health care than any other state in the country, according to a recent report from the Health Care Cost Institute. Texans are also burdened with the highest out-of-pocket spending for their health care needs.

The rapid proliferation of high-cost, stand alone emergency rooms throughout the state is making the problem worse.

These freestanding emergency centers are hard to miss. They're popping up on busy street corners and in strip malls next to grocery stores. Their slick marketing, bright lights and easy-access parking promise convenience.

What most people don't know is these freestanding facilities often charge up to 10 times as much for the same care provided at a doctor's office or urgent care facility.

Their business model is based on attracting patients who do not need true emergency care (ambulances do not go to freestanding ERs for a reason), but making them pay emergency room rates. The majority of them are considered out-of-network with major insurance companies, which means confused customers are often on the hook for a giant surprise bill weeks after treatment.

The top three reasons people in Texas visit stand alone emergency rooms are for fever, bronchitis and sore throat, all of which could easily be treated at an urgent care facility or doctor's office.

In Texas, the average allowed cost to treat bronchitis at a freestanding emergency center was $2,944, compared to $136 at a doctor's office and $167 at an urgent care location, according to claims data from major health insurers.

On average, the cost of treating a routine knee injury - $58 at a doctor's office and $88 at urgent care - could be more than $2,000 at one of these stand alone ERs, according to media reports. The same price differences apply for other common matters such as earaches, sprained ankles or runny noses.

These new, high-priced facilities are popping up around our state at jarring rates. In 2010, there were only about 20 freestanding emergency rooms in Texas; now the number exceeds 215 in Dallas and Houston alone. Soon there could be 1,200 of them across the state, according to independent experts.

Higher medical costs are a serious drag on Texas businesses. The majority of Texas companies self-fund their medical benefits, which means the company pays the full cost of employees' medical bills. As a result, the higher costs charged by freestanding emergency rooms come directly out of their bottom lines, siphoning money that could otherwise expand the business or create new jobs.

Furthermore, local health care costs are an important factor for companies considering relocation. Price gouging at stand alone ERs threaten to halt the momentum we've achieved in recruiting businesses to our state.

Freestanding ERs and their skyrocketing medical costs are pinching not only their patients but also Texas businesses and the state's economic growth. Texas businesses, health care consumers, insurers, policy-makers and regulators should unite now to address this urgent concern.

Amanda M. Martin is the governmental affairs manager of the Texas Association of Business. She lobbies on business issues such as health care, insurance and tort reform. She may be emailed at amartin@txbiz.org.


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