Who pays? How reimbursement impacts the emergency department.

Abstract

Background: Nationwide from 1996 to 2004, the overall proportion of Emergency Department (ED) reimbursement ratios for outpatient ED visits decreased from 57% to 42%. The continued falling of ED reimbursement ratios, which is the share of ED charges that are ultimately paid, is an indicator of the financial pressures facing the ED. Once the healthcare reforms are put in place what will the impact be on reimbursement rates of overburdened and underfunded emergency departments.

Purpose: The purpose of this study is to examine if there is a declining disparity in payment rates for ED care based on payment sources in a safety net ED provider. Findings of this study could indicate how the healthcare reforms might impact these types of ED reimbursement ratios in the upcoming years.

Methods: This was a retrospective study that examined randomly selected charts of all ED visits charts from May 2002 to May 2008 at a level one adult and pediatric emergency trauma center with 45,000 annual visits. This study was IRB approved.

Results: A regression model was used to predict if there was a relationship between amount received and types of insurance payers within the ED. A significant relationship was found between types of insurance (payers) as the independent variable, and the dependent variables of charges (p = .00), payments (p = .00), amount of adjustments (p= .00), and balance remaining after 90 days (p = .00).

Conclusions: Who pays for the ED services does impact the ED's bottom line. The privately funded patients will provide an ED with a higher reimbursement ratio per year as compared to those patients who are publicly or self pay. This explains why EDs that provide care for 40% or more publicly or self pay patients have seen a decline in reimbursement ratios. Healthcare reform has the potential to change and possibly improve safety net ED rate of reimbursement depending on how private, public and self pay patients pay for ED services.