Price Gouging at Trauma Centers Moves into the Spotlight

We have all heard stories of medical price-gouging, but an investigation published earlier this week by the Tampa Bay Times shows that in Florida hospitals have taken the practice to a new level.

According to a lengthy investigation by the newspaper, a change in Florida law several years ago allowed hospitals to charge special fees for the use of trauma centers. The centers are specialized facilities within emergency rooms and hospitals have long argued that establishing and maintaining them incurs unique costs which the institutions ought to be able to pass along to patients and insurance companies. For such fees “a fair cost, according to the federal government’s Medicare program, is just under $1000.” According to the newspaper, however, because the fees are not regulated “the average fee today tops $10,000; the most expensive hospital regularly charges $33,000.”
To be clear: these fees are in no way related to actual services rendered. They are, as the newspaper puts it, a “cover charge.” The paper recounts numerous instances in which patients “were charged more in trauma fees than for their actual medical care.” Since the fees are both unregulated and unrelated to the actual medical services a patient receives, the hospitals have an obvious incentive both to raise the fees as much as they can and to admit patients to the trauma center regardless of whether or not they actually need to be there. In one particularly shocking case, “an uninsured woman… was charged $33,000 even though she only needed someone to treat superficial cuts.”
Stories like these raise serious questions of patient safety. One must ask what is going undone, or who may be left awaiting treatment, while hospitals are working to maximize the fees they can collect merely for entering the door of a trauma center. Lest one dismiss this as a Florida story with no relevance here in Oregon, it is worth adding that key research on this issue was conducted by Portland’s Oregon Health and Science University Hospital. An OHSU study published last year looked at seven western cities, including Portland, and concluded that trauma center charges billed to patients “who didn’t need to go there (cost) the health system more than $130 million per year.”
Wastefulness and price gouging are just two of the many things that are driving up the cost of medical care in Oregon and across the United States. As a Portland-based patient safety and personal injury lawyer practicing in both Oregon and Washington this is an issue I follow closely. We all have the right to receive the medical care we need (that is why emergency rooms are barred by law from withholding life-saving medical care), but ensuring that it is affordable and truly available for every American and every Oregonian is, unfortunately, more difficult than it should be.

Tampa Bay Times: Insult to Injury

Tampa Bay Times: Debate over Florida trauma response fees moves to Tallahassee

Science Daily: Minimially injured people sent to trauma centers cost hundreds of millions per year