Annals of Emergency Medicine study shows declining trend in emergency department payments

February 26, 2003

A study in the March 2003 issue of Annals of Emergency Medicine shows an overall declining trend in emergency care payments, with the most significant payment decline noted among the privately insured. (Declining Payments for Emergency Department Care, 1996-1998, p. 299)

"The study shows that only a little more than half of all emergency department visits are paid, and these payments continue to spiral downwards," said Rita K. Cydulka, MD, MS, of Case Western Reserve University in Cleveland, Ohio, and a co-author of the study. "Declining overall payment rates increasingly threaten the ability of emergency departments to provide emergency care to all regardless of ability to pay--as America's health care safety net."

Based on data from the Medical Expenditure Panel Survey, a nationally representative survey of the U.S. population conducted by the U.S. Agency for Healthcare Research and Quality (AHRQ), researchers found that from 1996 to 1998, the rate of payment for emergency department charges declined from 60.3 percent to 53 percent. In 1998, of $30.6 billion charged for emergency care only $16.2 billion was paid, compared with $17 billion paid out of $28.1 billion charged in 1996.

The largest decrease in payments was among the privately insured, who paid 75.1 percent of charges in 1996 and 63.4 percent in 1998. Total proportion of charges paid by Medicaid (34.5 percent), Medicare (43.9 percent), and the uninsured (47.7 percent) remained constant during this time period.

"The study indicates that the ability to recover losses from uninsured patients by 'cost shifting' to other payers is becoming more difficult, largely because managed care has eliminated the financial margin previously used for this purpose," said Dr. Cydulka. "The problem likely will become worse, since the number of uninsured patients is increasing.

"In addition, while we did not study whether charges reflect increases in true resource costs, we know from other research that patients seeking emergency care are sicker than ever before and require more emergency department resources, which would result in increased charges," added Dr. Cydulka. "If this is the case, the declining overall payment rate further illustrates the fiscal health of emergency departments is worsening."

American College of Emergency Physicians

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