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August 19, 2024

ER or urgent care: Hospitals say patients don't have to choose

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Patients with non-emergency conditions seeking care in emergency departments drain resources from hospitals and health systems, leading some providers to consider a dual-care model.

A growing number of health systems are partnering with private equity-backed company Intuitive Health to establish combined emergency and urgent care sites. The standalone facilities, which are licensed as satellite emergency departments, offer both levels of care under one roof. Intuitive offers back-office and operational management support, while the health systems provide clinicians and handle billing.

One goal of these facilities is to save money for patients, payers and providers.

Providers say there are clear savings for patients — and payers — in funneling more people through lower-cost urgent care. Scottsdale, Arizona-based HonorHealth, for example, estimates each of its two combined facilities saved patients and payers $28 million to $35 million in a year when compared with traditional emergency department billing.

Clinicians screen patients to determine what level of care is most appropriate, removing the guesswork for them.

"I can't tell you how many times I have been contacted by friends and family and others with a similar question. ... 'I've got these symptoms. Should I go to the ER or should I go to urgent care?'" said Dr. Jonathan Velez, president at Baptist Health in Louisville, Kentucky, which opened a 12-bed combined facility with Intuitive in the Blankenbaker neighborhood in spring 2023.

"If they go to the emergency department and really it's not an emergency situation, then they're still going to be billed emergency rates, and they'll pay more money for something that they could've paid less for," Velez said.

Baptist, which also has a combined facility in Jeffersonville, Indiana, said uninsured patients at its combined locations owed an average $471.92 out of pocket for urgent care services after discounts in fiscal 2024, compared with $2,063.52 out of pocket for emergency services.

Providers have sought to educate patients on the difference between emergency and urgent care for years, with mixed results.

Emergency care is typically more expensive because of facility fees, staffing requirements and sicker, more complex patients. Non-emergency cases in the emergency department often mean patients with true emergencies are forced to wait for open beds or seek care elsewhere.

“Patients don’t all need to be seen at a level 1 trauma center, nor do they want to,” said Patrick Green, CEO at University of Florida Health Jacksonville, which opened three combined facilities with Intuitive in Jacksonville last year.

Most patients at combined facilities are directed to urgent care, and those in need of higher-level care sign an acknowledgment form to transition to emergency services. Patients with severe, life-threatening conditions such as heart attack or stroke are typically transferred to the health system's nearest full-service hospital.

Founded in 2008, Plano, Texas-based Intuitive opened its first combined facility in nearby Frisco, and began opening more with health systems in 2019 to expand into new states. The company operates more than 30 locations with 11 health systems in nine states. Two more will open later this year.

Intuitive CEO Thom Herrmann estimates the combined facilities, which treated about 860,000 patients last year, saved roughly $200 million for patients and payers in avoidable emergency department spending.

The cost savings for providers are not as clear-cut as savings for payers and patients, given the lack of data on the relatively new facilities.

Rick Murdock, vice president of strategic planning at HonorHealth, said the system's combined facilities in Scottsdale and Surprise, Arizona, cost about $32 million to build and are not "big moneymakers." However, he pointed to some other benefits for the company.

Murdock said the combined facilities were a way for the six-hospital system to expand its presence in a fast-growing market, with Intuitive providing capital support and taking on some of the risk.

Combined facilities also can relieve some pressure on a health system’s existing, overused care sites.

“You could imagine that a hospital that’s at its capacity for inpatient beds gets backed up in its emergency department with patients who are waiting for beds, and then the emergency department gets backed up for all patients,” said Robert Huckman, a business administration professor at Harvard Business School and faculty chair of the school’s healthcare initiative.

Ge Bai, an accounting and health policy professor at Johns Hopkins University, said the combined facilities can generate more revenue by keeping patients within a health system for both levels of care.

Bai said combined facilities likely work best in competitive markets with multiple providers, giving the health system more of an incentive to add care sites to capture market share.

Intuitive assesses markets for population density, access to care and emergency department use rates when looking for new health system partners, Herrmann said. Intuitive is open to partnerships with systems of all sizes, but it usually looks for partners with the capacity to open multiple locations, he said.

Intuitive plans to open another 50 locations over the next three years with providers such as Tacoma, Washington-based Virginia Mason Franciscan Health, the Medical University of South Carolina in Charleston and Arlington, Virginia-based VHC Health.

Dr. Timothy Zwayer, medical director at ProMedica Toledo Hospital Emergency and Urgent Care in Ohio, noted the efficiency of combined facilities.

Rooms in those facilities are typically equipped to handle emergency and urgent care patients, as are the clinicians. Toledo-based ProMedica opened a 10-bed combined facility with Intuitive in Maumee, Ohio, in late 2021. The facility now serves 110 to 120 patients per day, Zwayer said.

Zwayer said shared on-site imaging and lab capabilities help speed up decision making on patient care.

“We can kind of flex where we’re needed and be able to help out the entire facility,” he said.