A Sagging Safety Net

A sagging safety net

Free care by Florida’s emergency physicians averages 47%, climbs faster as uninsured patient visits increase

Tampa, FL (Dec. 22, 2005) -- Hospital emergency physician groups serving an increased volume of uninsured patients had disproportionately higher rates of free, or uncompensated, care – a consequence that may worsen overcrowding, adversely impact quality of care and lead more emergency rooms to close their doors, University of South Florida researchers found. USF worked with the Florida College of Emergency Physicians (FCEP) on the study, which is published in the October-December 2005 issue of Health Care Management Review.

The researchers surveyed 188 Florida hospital emergency physician groups about the uncompensated care they provided in 1998. The 83 physician groups responding provided substantial uncompensated, or free, emergency care, ranging from 26 to 79 percent with an average of nearly 47 percent.

Uncompensated services are those for which no payment is received from either the patient or from a public or private insurer. Such services encompass charity care for patients who cannot afford to pay, bad debt from patients who choose not to pay their portion of the bill, and denial of payment for emergency services by health plans.

“This study is one of the first to quantify the uncompensated care provided by Florida emergency physicians,” said lead study author Barbara Langland Orban, PhD, associate professor and chair of Health Policy and Management at the USF College of Public Health. “Emergency physicians say the large amount of uncompensated care they provide has become a substantial cost of practicing emergency medicine, but we did not expect such a high percentage of free care.”

“Legislators and the public need to recognize that uncompensated care is not just a problem involving uninsured patients – it affects all patients,” said FCEP President Jorge Lopez, MD. “The same standard of care is provided to everyone who comes through the emergency department. If that care deteriorates from lack of adequate funding and resources, it deteriorates for everyone.”

The researchers created a statistical model to predict the amount of uncompensated care using patient volume and payer type, such as Medicare, Medicaid and indemnity insurance. While hospital ownership – public nonprofit, private nonprofit or for-profit – leads to very different levels of uncompensated care for hospitals, it did not determine the levels of uncompensated emergency physician care. Emergency physician groups providing the highest levels of free care tended to practice in urban hospitals serving large populations of Medicaid and uninsured patients.

By law, all patients who come through a hospital’s emergency room must be examined regardless of their ability or willingness to pay or whether the medical complaint is an emergency. The number of uninsured patients in Florida and nationwide is growing even as discounts negotiated by private insurance plans and government programs such as Medicaid and Medicare continue to squeeze reimbursement for health services. Thus, the researchers suggest, an emergency physician group’s ability to shift costs from uninsured to insured patients to offset declining revenue is increasingly limited. Furthermore, unlike hospitals, emergency physician groups do not offer other non-emergency services that could help subsidize unfunded emergency care.

“We have a government mandate to take care of all Florida residents and visitors who come through our doors, without provisions to help pay for it,” said Dr. Lopez, president of Florida Emergency Physicians, an independent group of emergency physicians covering seven hospitals in Central Florida. “We are among the first responders entrusted to provide vital services in times of medical crises, yet we do not enjoy the same sovereign immunity protection as paramedics, police and firefighters.”

FCEP and its parent organization, the American College of Emergency Physicians, advocate for fair reimbursement to defray the cost of emergency care and medical malpractice reform.

The USF study did not specifically examine why the cost of uncompensated care rises at a higher rate as unfunded emergency department visits increase. But Dr. Orban offers two possible explanations:

First, emergency physician groups providing a higher percent of uncompensated care likely work in tertiary care hospitals with trauma, cardiac or stroke centers, she said. “The intensity of services required by sicker patients would result in higher average per patient charges and costs in the hospital’s emergency department.”

Second, emergency physician groups may set higher prices to try to offset higher levels of uncompensated care, Dr. Orban said, but the attempt to cost shift does not necessarily result in higher reimbursement rates from third party payers.

Emergency care for uninsured patients is an extremely important safety net in the health care system, the study authors conclude. “Intervention by policy makers is indicated to reduce and deter uncompensated care to avoid the negative effects of emergency department crowding on hospitals, physicians and patients and the closure of additional emergency departments.”

USF’s Etienne Pracht, PhD, and Seena Salyani, MBA, MHA, were co-authors for the study.

- About USF Health -

USF Health is the University of South Florida’s enterprise of researchers, teachers and clinicians dedicated to improving the full continuum of health. Its core is the colleges of Public Health, Nursing and Medicine, including a School of Physical Therapy, as well as the healthcare delivered by its 450 physicians and more than 100 nurse practitioners. In partnership with its affiliated hospitals, USF Health’s research funding last year was $134 million -- more than half of which came from federal sources. Last year, USF health clinicians cared for more than 31,000 patients and oversaw 396,000 outpatient visits.

- About Florida College of Emergency Physicians -

The Florida College of Emergency Physicians (FCEP) represents more than 1,100 emergency physicians in the state of Florida. FCEP members represent the health care safety net of Florida’s residents and visitors. More than seven million patients seek care annually in Florida emergency departments. FCEP was founded on Oct. 15, 1971 and is headquartered in Orlando.