For many communities, especially in rural and underserved areas, emergency departments (EDs) are the only available point of access for timely healthcare. Most emergency departments are legally obligated to provide care to all patients regardless of a patient’s ability to pay or insurance status.
As a result, EDs are a unique and highly valuable asset in our communities. But the ability to maintain this critical healthcare resource is under threat.
A recent RAND study found that in addition to significant reductions in payment from every major health insurance source and a lack of inflation updates for many years, 20% of all ED physician payments types are unpaid, totaling a whopping $5.9 billion per year. From 2018 to 2022, commercial in-network insurance payments to EDs dropped by 10.9%, while out-of-network payments plunged by 47.7%. Inexplicably, during the same time, ED facility fees (paid to hospitals) rose by 18.7%.
Underpayment for high quality emergency care is not an anomaly; it is a critical factor that is failing one of our most fundamental healthcare resources—our nation’s EDs.
The RAND study goes on to point out numerous converging factors that paint a very concerning picture. Insurance companies routinely underpay or deny portions of fees owed for required clinical evaluation and stabilizing care. In addition, uninsured patients often lack the ability to pay anything for clinical services.
These factors produce significant financial challenges for emergency practices. Unfortunately, independent physician groups and those in rural and underserved areas are hit the hardest, pushing many that are already operating on razor-thin margins into the red. As a result, EDs are closing or consolidating at an alarming rate, eroding access to lifesaving care and putting communities across the country at risk.
This isn’t a potential crisis. It’s already here. Between 2017 and 2024, rural hospital closures far outpaced openings, with 62 rural hospitals shutting down across the country, compared to just 10 that opened. This past April, Trinity County, Texas, became the latest casualty, losing its only hospital just 14 months after opening in a county where more than half of residents are under the poverty line, and many constituents are uninsured. Now, Trinity County residents must travel more than 30 miles when seeking emergency or primary care. Waiting for an ambulance can significantly delay critical care, especially for time-sensitive conditions like heart attacks, strokes and trauma. One Trinity County resident’s daughter was injured while at a friend’s house and her mother, who was 90 miles away from the scene, actually beat the ambulance to the closest emergency room. This is the reality for many rural communities—a reality we cannot ignore.
Since 1987, the Emergency Medical Treatment and Labor Act (EMTALA) has done an admirable job of protecting access to healthcare regardless of patient’s ability to pay. While EMTALA has created a valuable healthcare safety net, the law remains an unfunded mandate, and current economic pressures create an unsustainable trajectory. The fallout is affecting the most vulnerable populations first, including those on Medicaid, the uninsured and many rural communities. But, since nearly all emergency care in the U.S. is subject to similar forces, it’s a matter of time before the same trajectory impacts all emergency care. Our nation’s clinical safety net is indeed at risk.
Recently, more fuel has been added to the fire. Since its implementation in 2022, the No Surprises Act has laudably protected patients from unexpected bills. However, misapplication of other provisions in the law has emboldened insurers to significantly reduce or delay payments and even force providers and patients out of their networks. This has compounded longstanding insurance company tactics such as downcoding and payment denials, which allow insurers to shortchange providers while sidestepping accountability for the detrimental consequences these actions impose.
As an emergency physician with decades of experience, I understand the importance of providing time-sensitive, high-quality care to our patients. I value the patient protections EMTALA has provided for many years and the protections that the No Surprises Act has newly created. Unfortunately, the economic realities articulated by the RAND study are widespread, forcing physicians to care for patients in an unsustainable environment while additional pressures intensify.
The only thing worse than failing to act in a crisis is failing to keep it from spreading. Here are four steps policymakers can take right now to ensure patients have sustainable and predictable access to high-quality emergency care:
- Mandate that insurers reimburse emergency physicians without unnecessary delay so that patients’ long-term access to emergency care is not jeopardized.
- Require that insurance entities (not physicians) collect deductibles and copays from their enrollees. As a physician, I want to be my patient’s doctor—not their bill collector. I simply want us to be paid for medical care that has already been delivered, as guaranteed by federal law.
- Expand Medicaid disproportionate share hospital payments to include direct reimbursement to emergency physicians, recognizing the vital role we play in the safety net for vulnerable populations.
- Establish a federal Emergency Department Standby Capacity Payment System to fund the 24/7 readiness EDs are required to maintain as we stand ready for the next emergency.
The state of emergency care is a public health crisis hiding in plain sight. If we don’t resolve how emergency care is funded and continue to allow insurers to dodge payment obligations, the lights will continue to go out in emergency rooms across the country.
The truth is, insurers won’t pay the price, but American patients will.
Randy Pilgrim, M.D., is enterprise chief medical officer at SCP Health.