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Protecting Against Padded Hospital Bills

How is it that you can be charged 200-300% more to see a doctor just because he or she sees you in a hospital-owned building or clinic?


Hospitals and health systems all across the country have been purchasing physician practices. Sometimes they even buy the physician's building, make no changes (except the name) and it becomes a hospital-owned facility. Sometimes, the physician keeps an independent practice going on the side at a different location not owned by the hospital.


When you see the physician in a hospital-owned clinic, you pay an additional price. This is called a facility fee. You pay far less if you see the same doctor in his or her independent clinic.


This is a true example. A St. Paul man had a one-hour session with his psychiatrist at the doctor’s private clinic. The psychiatrist charged $265. Six months later, the man saw the psychiatrist again, but at the hospital clinic. In the meantime, the psychiatrist had become employed part-time by the hospital. When the patient made the appointment to see the psychiatrist, no one told him he could have seen the doctor at his private clinic and saved money. As a result, the hospital charged $565 - $300 for the facility fee and $265 for the psychiatrist’s time.


When a hospital buys a physician's practice, it costs more for you to see that physician than when you saw her in her private clinic. You should have the right to know the difference in cost.

Solution - Require Disclosure and Choice

The facility charge must be disclosed at the time you make an appointment. The “facility” must tell you how much is charged for the physician’s services, and how much is for the facility. 


Additionally, when you can see the same physician at a different location without a facility charge, the appointments clerk must tell you and give you the freedom to choose where to see the doctor.