Facility fees and how they affect health care prices
- Collection:
- Health Policy and Services Research
- Contributor(s):
- Health Care Cost Institute, issuing body.
- Publication:
- [Washington, DC] : Health Care Cost Institute, June 2023
- Language(s):
- English
- Format:
- Text
- Subject(s):
- Fees and Charges Health Care Costs Hospital-Physician Joint Ventures -- economics United States
- Genre(s):
- Technical Report
- Abstract:
- When you receive care in a hospital, you will likely receive two bills: one from the physician(s) and other clinicians who provided your care (i.e., for their professional services) and one from the hospital. The hospital bill includes charges associated with care provided by the hospital (e.g., room and board, procedures, and evaluation and management) with overhead costs (e.g., equipment, space, and support staff) baked in. A component of the overhead cost is a “facility fee,” which supports the emergency room and other services the hospital must provide but which are not directly related to the care the patient received. Increasingly, facility fees are also attached to non-hospital care that patients might receive in a setting that is owned by a hospital. This can result in the same service costing different amounts depending on whether you get it in an independent physician’s office or one that is owned by a hospital, driving up costs for patients and the health system more generally. There is growing concern about patients being charged a “facility fee” even when they receive care outside a hospital. For example, news stories have reported patients receiving bills of more than $500 for a pediatrician office visit or over $6,000 for a minor dermatology procedure. If a physician’s office is owned by a hospital system, a patient may be charged a facility fee in addition to the bill from the physician who provides care. In these cases, the physician’s office is allowed to bill as though the care was received in a hospital (e.g., including a facility charge), despite no physical change in where patients are treated, or the care they receive. As hospitals increasingly acquire physician practices, facility fees in these situations have become more common. In fact, the opportunity to charge a facility fee is one incentive for hospitals to acquire these practices, which then leads to higher prices for patients, employers, and insurers.
- Copyright:
- Reproduced with permission of the copyright holder. Further use of the material is subject to CC BY-NC-ND license. (More information)
- Extent:
- 1 online resource (1 PDF file (2 unnumbered pages))
- Illustrations:
- Illustrations
- NLM Unique ID:
- 9918697376106676 (See catalog record)
- Permanent Link:
- http://resource.nlm.nih.gov/9918697376106676