Catalyst for Payment Reform

Heard in the News: Freestanding Emergency Care Centers

Heard in the News: Freestanding Emergency Care Centers

On April 25, 2017, there was a story on NBC’s Nightly News about a mother whose child had a fever and was coughing.  The mother took her child to what she thought was an urgent care center, however, it was a freestanding emergency center (FEC).  She didn’t realize it was a FEC until she received a surprise in the mail – a $1,700 bill.  This story touches on several topics near and dear to our mission at Catalyst for Payment Reform.

First, you may ask what is a FEC.  Per the National Association of Freestanding Medical Centers (NAFEC), these are licensed facilities with an emergency physician on hand 24/7.  Like a hospital emergency department, a FEC contains equipment and technology for life sustaining treatment, and may be independent or affiliated with a health system.  However, like an urgent care center, these facilities may be in a strip mall next to your favorite coffee shop.  In 2016, The New England Journal of Medicine reported the proliferation of these facilities as one of the fastest-growing trends in health care.  The same report indicates these facilities can achieve hospital-level quality of care.

NAFEC reports the cost of care is comparable to visiting the hospital ER.  For health care purchasers, you know this means the cost is several times the cost of an urgent care visit.  For consumers, a visit to the FEC is likely to result in a patient responsibility of the ER visit copay or deductible and coinsurance.

How do these centers impact your plan utilization, quality, and cost?  For employers and other health care purchasers, here are some questions you can ask your health plan to get yourself up-to-speed with FECs:

  • Understand your health plan network
    • Are there freestanding emergency centers in the health plan network?
    • Which freestanding centers are in the network, particularly in your concentrated areas?
    • Do certain centers improve geographical access for members who do not live near a hospital-based emergency department?
    • Are there centers not currently in the network that can close a geographical access gap in an area where members are located?
  • Understand your plan utilization
    • How many unique visits have there been to the FECs? What proportion of the visits are appropriate?
    • What are the outcomes for your members who visit the centers? What percent of your members visiting a center are admitted to a hospital?  How does this percentage compare to those who go to a hospital emergency room?
    • What is the average cost per visit for the emergency room versus freestanding emergency center versus urgent care center?
  • Understand and revise your benefit design, if necessary
    • Is a FEC visit covered in the same way as a hospital emergency visit or urgent care visit?
    • For your members who access a FEC then get transferred and admitted to a hospital, is the FEC copay waived in the same way that it would be in the case of an admission through a hospital emergency room?

Getting ahead of the kind of surprise reported on NBC Nightly News requires ongoing member education about the benefits and tools you offer (e.g. telehealth, nurse line or concierge, and quality and cost transparency tools) as well as communications to steer members to the appropriate site of care.  With your diligence, your population can avoid a similarly unpleasant surprise.

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