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Urgent Care Mega Trend #2: Freestanding ED Competition

The trend of freestanding ED competition is a puzzler. How can this model work? Why would anyone pay ED fees for urgent care services? It works because in some states, laws require that care delivered in an emergency department must be covered by insurance payors. Freestanding EDs do not need to sign contracts with ED payors to get paid. These providers bill ED fees for sore throats and sprains, driving up of the cost of healthcare for insurance companies and patients who will be charged higher copays and coinsurance. We can only hope that this trend reverses in the near future.

Freestanding ED

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As Alan Ayers, Vice President of Strategic Initiatives, explains in the blog post “What’s the future of freestanding emergency departments?” the trend is concerning. “From a consumer standpoint, it’s a bad value. From an insurance perspective, it adds cost because people are not using these for real emergencies,” Ayers explains. A 2015 study done by the Center for Improving Value in Health Care in Colorado found that residents there would save potentially $800 million annually if they stopped using emergency departments for non-emergent care. Individuals could pay on average $1,150 less per visit using a clinic instead.