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POV: EPs are the new servants of corporate America : Emergency Medicine News


contract management, healthcare costs


The COVID-19 outbreak has thrust emergency physicians into the media spotlight, showing them saving countless lives from a highly contagious virus through hands-on frontline care. Emergency doctors intubated infectious patients without hesitation moments before their last breath of air, performed CPR on those arrested in the emergency department, and spent hours fine-tuning IV drips to stabilize patients seriously ill.

Countless other patients with traditional issues such as undifferentiated chest pain, traumatic injuries and serious illnesses walked through the ambulance bay doors or entered the emergency hall as we cared for this new wave of patients.

Behind these headlines is the story of Wall Street-oriented corporations exploiting emergency physicians for outrageous profits. (American Academy of Emergency Medicine. 2019; Healthcare companies, including hospitals, contract management groups (CMGs) and others, need licensed physicians to make money. (REM. 2021;43[9]:3; Healthcare entities cannot bill health plans or patients without a physician’s signature for an order or computer entry on the order page. To be blunt, the healthcare industrial complex can’t earn a dime without a doctor’s prescription.

Physician fees billed during an average emergency room visit represent less than 10% of the total bill a patient receives; the other 90 percent of the costs go to the hospital. Too often, the doctor only receives five percent of the total bill, with the other part of the professional fee going to a CMG, usually a Wall Street stockholder or private equity firm.

Health care in America is expensive, costing our society nearly $4 trillion a year, or the equivalent of $12,000 a year for each person; it’s $48,000 a year for a family of two adults and two children. (Societing American Health Care: How We Lost Our Health System. Baltimore: Johns Hopkins University Press, 2021: pp. 91-104.) Wall Street has noticed and now intends to mine this gold, and doctors have become the mules delivering this gold to private capital and corporate shareholders on Wall Street. Profits can be made from every order a doctor signs or enters into the computer, from lab tests and imaging to procedures, supplies and medications. The biggest cut in profits goes to hospitals.

Health care may have become about profit in America, but that is not the case in Europe. Overall health care costs are half of what we pay in the United States, and emergency care costs are only one-third of US costs. We can attest from visiting professors in European hospitals that emergency care is equal to or better than American emergency care. Yes, it is possible to provide superior emergency care to people and not take undue advantage of their injuries and illnesses.

Emergency doctors provide care in a risky environment while hospitals make huge profits from emergency department user fees.. These fees can range from hundreds of dollars to $10,000 depending on the visit level, with level 5 being reserved for critically ill and injured patients. Kaiser Health News republished a $7,000 facility use fee for a brief visit by a man vomiting due to a hangover. (NPR. Sept. 9, 2019; Does a patient get a discount for being treated in a crowded and noisy hallway rather than a private room? Not that we know.

Emergency doctors provide care in a risky environment while hospitals also benefit from surcharges that result from special designations such as Trauma, Cardiology, and Stroke Centers. Patients with these problems are usually brought to the emergency room by ambulances according to established prehospital rules. Additional costs for traumatic activation can range from a few thousand dollars to $50,000. Emergency physicians who tried to challenge an inappropriate trauma alert were reprimanded. (REM. 2021;43[9]:5;

Emergency physicians provide care in a risky environment while hospitals profit from protocols. In the past, highly skilled and trained emergency physicians would assess the patient’s problem and then determine the appropriate course of action, such as lab tests and x-rays. Hospitals now often require a physician to use a computerized command set that automatically orders multiple high-throughput lab tests and unnecessary high-radiation imaging. One of us (MB), for example, reviewed the case of a healthy man in his early twenties who presented with chest pain and was discharged home with a prescription of ibuprofen. He was billed nearly $17,000 for an unnecessary “protocol” workup that included several for-profit lab and imaging tests.

Hospitals also make money by ordering unnecessary documents from inefficient IT systems. Physicians are told they must complete all pages of EHRs which are too often inefficient, sometimes requiring the entry of patient information unrelated to the visit, such as the sexual history of a person with hand laceration. The motivation for hospitals: providing additional data to third parties can generate additional revenue.

Make no mistake: nonprofit hospitals are organized like for-profit hospitals. Non-profit organizations operate on a for-profit business model, but they do not pay most taxes and in return are expected to funnel money into the community, which is often a very small part of their operating expenses. (Societing American Health Care: How We Lost Our Health System. Baltimore: Johns Hopkins University Press, 2021: pp. 91-104.) But prices for evaluation and treatment in emergency departments are often similar to, or even higher than, those in for-profit hospitals. Nonprofits use their “profits” to pay large salaries and bonuses to senior executives, hide extra income as “reserves,” and use other accounting tricks.

Contract management groups also make money for companies. A majority of hospitals now contract with companies or private equity groups to staff their emergency departments. CMGs are essentially staffing companies that charge for doctors’ services, taking a big cut in doctor’s fees for themselves. These groups have also been accused of falsely overcoding ER visits: the higher the level of visit, the higher the bill can be. CMGs hire and fire emergency medics. A doctor who complains about safety issues could pose a threat to a lucrative contract. Emergency doctors have been fired without cause and they may have to travel out of town to find other jobs if their employment contract includes a non-compete clause. (J Medical emergency. 2013;45[1]:111.)

We encourage emergency physicians to work together to remove the corporate yoke from our necks. We cannot continue to be a silent servant of American business. Ensure patient care decisions are based on need, not profit. Patients trust us to have their best interests first and foremost. Let’s not betray that trust. Report to the relevant authorities any inducements you see imposed on physicians to increase their profits. Use anonymous reporting systems if necessary and keep records showing time and date. Don’t fear retaliation: you could later be accused of failing to report patient abuse.

We encourage every emergency physician to know the cost of anything ordered from the emergency department. How much did this lab test cost? How much will the hospital charge for an intravenous infusion? How much are CT scans, MRIs and trauma activations charged? Work with your professional societies to reduce corporate dominance. Write about your ER experience and what you think is unfair. Be proactive on behalf of your patients, not the companies that employ you.

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Dr. Derletis professor and chief emeritus of emergency medicine at the University of California, Davis. He founded the EM residency training program and is the author of the book the corporatization of American health care; How we lost our healthcare system. Dr. Bordenis an emergency physician in Washington State and author of the book Medical wisdom.