Hospitals charging absurd 'trauma' fees to treat minor injuries
Hospitals across the country have been charging ridiculous 'trauma alert' fees for patients requiring minimal treatment.
The fees, which can be upwards of $50,000 per patient, are billed when a hospital's top surgical specialists are summoned - typically for the most severely injured patients.
One such case, found within court filings from a 2017 trial, revealed that a 30-year-old man who arrived at a Modesto, California hospital for shoulder and back pain following a car accident was billed $44,914 by Sutter Health Memorial Medical Center, which included a $8,928 "trauma alert" fee. The man went home in less than three hours, according to CNN.
"Some hospitals are using it as a revenue generator," said registered nurse and medical claims consultant, Tami Rockholt, who appeared as an expert witness in the Sutter Health trial.
"It's being taken advantage of," she continued, adding that such cases are "way more numerous" in recent years. "If someone is not going to bleed out, or their heart is not going to stop, or they're not going to quit breathing in the next 30 minutes, they probably do not need a trauma team."
Tens of thousands of times a year, hospitals charge enormously expensive trauma alert fees for injuries so minor the patient is never admitted.
In Florida alone, where the number of trauma centers has exploded, hospitals charged such fees more than 13,000 times in 2019 even though the patient went home the same day, according to a KHN analysis of state data provided by Etienne Pracht, an economist at the University of South Florida. Those cases accounted for more than a quarter of all the state's trauma team activations that year and were more than double the number of similar cases in 2014, according to an all-payer database of hospital claims kept by Florida's Agency for Health Care Administration. -CNN
The underlying justification for the fees is that trauma centers should be able to recoup the cost of having a crack squad of doctors and nurses assembled when an ambulance crew reports an incoming patient who needs trauma care - even if said squad never actually swings into action.
"We do see quite a bit of non-appropriate trauma charges — more than you'd see five years ago," according to Pat Palmer, co-founder of Beacon Healthcare Costs Illuminated, which analyzes thousands of bills for insurers and patients. Palmer says that recently "we saw a trauma activation fee where the patient walked into the ER" and walked out shortly thereafter.
Between 2012 and 2020, Florida trauma activation team cases without an admission rose from 22% to 27% - with one facility, Broward Health Medical Center counting 1,285 trauma activation cases with no admission - nearly the same number of patients who were admitted without a trauma fee.
"Trauma alerts are activated by EMS [first responders with emergency medical services], not hospitals, and we respond accordingly when EMS activates a trauma alert from the field" not hospitals, said Broward Health spokesperson, Jennifer Smith.
According to standards published by the Florida Department of Health, hospitals can declare an "in-hospital trauma alert" for "patients not identified as a trauma alert."
Not all hospitals appear to be taking advantage. At Regions Hospital in St. Paul, Minnesota, it's "very rare" not to admit a trauma alert patient. Last year, around 5% (42 out of 828 cases) were non-admitted trauma alert patients, according to Dr. Michael McGonical, the center's director who runs The Trauma Pro blog.
"If you're charging an activation fee for all these people who go home, ultimately that's going to be a red flag," he said.
That said, while hospitals may bill trauma fees, insurance companies are drawing lines.
Reimbursement for trauma activations is complicated. Insurers don't always pay a hospital's trauma fee. Under rules established by Medicare and a committee of insurers and health care providers, emergency departments must give 30 minutes of critical care after a trauma alert to be paid for activating the team. For inpatients, the trauma team fee is sometimes folded into other charges, billing consultants say.
But, on the whole, the increase in the size and frequency of trauma team activation fees, including those for non-admitted patients, has helped turn trauma operations, often formerly a financial drain, into profit centers. In recent years, hundreds of hospitals have sought trauma center designation, which is necessary to bill a trauma activation fee. -CNN
"There must have been a consultant that ran around the country and said, 'Hey hospitals, why don't you start charging this, because you can," said Marc Chapman, founder of Chapman Consulting, which challenges large hospital bills for auto insurers and other payers. "In many of those cases, the patients are never admitted."