Freestanding ER Units Are Disincentivized To Open In Areas Where Medicare And Medicaid Are Common

Freestanding ER units are meant to be an innovative alternative to the traditional, yet overcrowded, hospital adjoined emergency departments.

In a recent article published by The Dallas Morning News, Sabriya Rice exposes a trend in access to freestanding ERs in Texas as it correlates with zip code and average income medians of the areas served by the technology. According to a new study, freestanding emergency centers in Texas, Ohio, and Colorado, were conveniently located in wealthy areas.

This understanding concerns many health policy researchers, because emergency services have historically been provided by hospitals in the U.S., meaning they must adhere to federal regulations that protect patients from being denied care whether they can afford it, or not.

"It's the one part of healthcare where there is some expectation that everyone can have access," said Dr. Jeremiah Schuur, lead author of the study. "That might not be the case in a parallel emergency system, one that is not regulated by the same standard that has prevented hospitals from dumping patients."

Texas became the first state to legalize freestanding emergency services to be provided by private for-profit companies, not just hospitals. When also considering the fact that Texas got an “F” in a 2014 report card from the American College of Emergency Physicians, many are concerned that this potentially game-changing alternative to traditional emergency departments is not helping to improve emergency care access.

Researchers evaluated states where freestanding emergency centers were most prevalent as of March 2015 as well as their affiliations with hospitals and the characteristics of people living in the zip codes they served.

Researchers also found that nearly 72 percent of people living in areas served by freestanding ERs were privately insured, and bring in an average income of just over $73,000. Whereas the average income in areas not served by freestanding ERs was just under $50,000 and were more likely to be on Medicare, or uninsured.

According to the study, 21 percent of the free-standing centers were affiliated with hospitals, compared with 54.2 percent nationwide; 71.3 percent were independent for-profits, compared with 45.3 percent nationally.The barrier to offering these services to the poor is because the Centers for Medicare and Medicaid Services won't recognize or reimbursing freestanding ERs.

Consumers wanted a better alternative to traditional EDs, including reduced wait times without sacrificing standard of service, but with such a tight window of inclusion, this solution isn’t really helping the majority of the U.S. population.

"It's a huge burden. And a huge disincentive not to open up in areas where many patients may have Medicare, Medicaid or Tricare," said John McGee, a board member for the Texas Association of Freestanding Emergency Centers.

Payment structures will continue to be evaluated among policy makers, professional organizations, and insurers nationwide to develop a way to grant access to all Americans, regardless of income, or coverage.

One thing is for sure, considering the economic upside for those vested in free-standing ERs, expect this innovative alternative to traditional ERs to continue to advance.