CLEVELAND — As consumers, we're constantly getting hit with fees like baggage fees, hotel fees, and banking fees. 5 On Your Side Investigators dug into some of the most frustrating fees: hospital facility fees. Health systems told us the fees are needed. Some billing experts, though, said they're not.
"I was born with Rheumatoid Arthritis. So, I've had it all my life," said 58-year-old Karen Valore from Avon Lake. She’s in pain. "It's been rough,” she told us. She’s had knee replacement, five hip replacements, and too many bills to even count. "It takes a long time to recover."
Now, she fears going to her own mailbox. “Because I don't know what fees are going to hit me next," she said.
In addition to regular bills, patients like Valore, are slammed with facility fees tacked on.
"Why are (hospitals) going after (patients) for facility fees and room fees?” Valore questioned. “This is just all crap."
5 On Your Side Investigators contacted Cleveland Clinic, University Hospitals Cleveland Medical Center, and MetroHealth Medical Center about facility fees.
Metro sent us a pamphlet that mentioned you "may receive a facility charge and it's up to your insurance on how reimbursements are shelled out."
"This has just gotten way out of hand and I'm really upset that the insurance company runs your life,” said Valore.
We contacted America's Health Insurance Providers. It's a national advocate for the health insurance business.
It released a statement:
"Facility fees from in-network hospitals are covered. Like any treatment, medication, doctor’s visit, or other health service, facility fees would count toward a deductible. As you likely know, higher health care costs mean higher premiums and higher deductibles – since the vast majority of every health care dollar goes to pay for the cost of care. So as facility fees go up, they will impact patients’ and consumers’ out-of-pocket costs and premium costs. We advocate for more affordable care – because everyone deserves affordable health care choices so that everyone can be covered, and everyone can make health care decisions that are right for them and their families.”
University Hospitals Cleveland Medical Center sent us a statement which said —in part,"...charges may reflect costs for items and activities…"
Cleveland Clinic said everyone charges fees and have been for years. And that "these fees help cover services provided to patients and substantial costs..."
"That's certainly not what most of the empirical evidence supports,” said Christopher Whaley with RAND. That’s a worldwide organization that is non-profit, says it's nonpartisan and is "grounded in rigorous analysis".
Whaley called the hospitals' reasons for fees the "cost-shifting story" that doesn't add up. “What's really going on is large systems are able to negotiate prices, in some sense, because they can... not necessarily because there are big changes to their underlying cost-structure," Whaley told us.
His nearly 10 years of research certainly goes along with Medical Bill Advocate and expert from our area Pat Willis who said this about pricing procedures.
"There's no rhyme or reason for the fact. They’re really isn't,” said Willis. “Every hospital it's up to them what they want to charge… there's no law. There's no rules or nothing."
And when it comes to facility fees, reports show they're rapidly "spreading to doctor practices, clinics, and surgery centers." Hospitals are quickly buying up smaller doctors’ offices and outpatient services.
In fact, the Physicians Advocacy Institute reports a 17% increase (2012-2018) in hospitals owning physician practices.
"The actual office, they change the sign at the door,” said Whaley. “The hospital is now able to get a facility fee from these services."
Whaley said it's just another way for hospitals to make money. And not only are you hit with fees, there are treatment bills to worry about now. “We certainly know that prices go up when physicians integrate with hospitals and health care systems,” Whaley told us. He said overall costs increase 10%-20% when hospitals take over.
The Centers for Medicare & Medicaid acknowledged that its beneficiaries were paying "more for the same type of clinic visit in the hospital-outpatient setting than in the physician-office setting." Within this past year, it lowered those co-payments so it doesn't matter which facility people use.
"So, there's at least some innovation on the federal side,” said Whaley.
And it appears more and more states are going after the fees, too. Reports highlight Connecticut cracking down on facility fees and forcing health systems to make the costs clearer for patients.
Valore would like that and some kind of facility fee reform in Ohio. "I just think this whole process is ridiculous. You know, they're nickel-and-diming you for everything. That is absurd,” said Valore.
You can see the full statements from the organizations featured in this story below.
Full University Hospitals Statement on Facility Fees:
“Our primary care practices and many of our specialist practices do not involve facility fees. A few of our advanced programs, such as at the UH Seidman Cancer Center, are set-up as hospital-based programs and would therefore include a facility fee.
Services that take place within a hospital outpatient department are separated into two bills: one for the services of the physician and the other for all other costs. When a physician provides a service in a hospital department, the physician bills a reduced service fee because the hospital, not the physician, is responsible for the “practice expense” associated with the visit, including all other non-physician support staff.
Non-physician charges may reflect costs for items and activities such as equipment, utilities, maintenance, supplies and non-physician staff, such as nurses and other staff. The hospital bills separately from the physician. These non-physician charges are commonly referred to as the “facility fee”.
Full Cleveland Clinic Statement on Facility Fees:
“Hospitals nationwide and locally have been utilizing facility fees for years. These fees help cover services provided to patients and substantial costs to meet required Medicare quality standards. We encourage anyone with questions to contact our Patient Financial Services Center at 866-621-6385.”
Full MetroHealth Statement on Facility Fees: