Hidden costs surprise patients

They can find that a 'flat fee' may actually have another cost bulge or two.

THE MIAMI HERALDFebruary 25, 2014 

When a rheumatologist told Linda Drake, of Miami, that she might have lung cancer, the former smoker did some research and discovered a study for early detection and treatment of the disease with researchers in South Florida.

Drake, 57, participated in the study because there was a $350 flat fee, and she could enroll through UHealth - the University of Miami's network of clinics and hospitals.

She could even go to a UHealth outpatient clinic close to work. That clinic, Sylvester at Deerfield Beach, Fla., is about a 40-mile drive north from UM's Miami hospitals.

Drake's visit last spring took about one hour, she said, including a CT scan. She saw a technician and a nurse practitioner. About a week later, she received an analysis of the images by a radiologist she never spoke with or met.

The results were negative. Drake breathed a sigh of relief. But a few days later, an unpleasant surprise arrived in the mail: a bill for $210 from UHealth for "hospital services" labeled as "Room and Board - All Inclusive," even though she never set foot in a hospital or spent the night at the clinic.

Her health insurance would not cover the fee.

"It's not just the fee," she said. "It's the way they've gone about implementing it that's offensive."

As hospitals consolidate into mega-health systems, buying physician practices and building urgent care centers and outpatient clinics miles from their main campuses, patients are discovering that - just like baggage fees for air travel and convenience surcharges for concert tickets - some health care comes with hidden costs: facility fees.

These are charges that allow hospitals that own physician practices and outpatient clinics that meet certain federal requirements to bill separately for the facility as well as the medical service provided there. Drake was charged the fee because the Deerfield Beach center is owned by UM and considered a department of UHealth's hospitals.

Consumers are seeing these fees more often as hospital systems build more outpatient centers to create the integrated health care delivery models envisioned by the Affordable Care Act.

The fees, also referred to as "provider-based billing," are the result of a change in the federal rules for Medicare that took place about a decade ago. That change allowed hospitals to bill Medicare, the federal health care program for the elderly, for physician services separately from building or facility overhead.

Independent, physician-owned offices and freestanding clinics are not permitted to charge the fees. But federal rules say hospitals that charge facility fees for Medicare patients must do the same for all others.

Hospital advocates and health care groups say the fees are necessary to help defray overhead, pay salaries, meet federal standards and ensure patients' access to emergency services, said Erik Rasmussen, senior associate director for the American Hospital Association, a national membership organization representing thousands of hospitals and other providers.

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