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Government & Law

Health Insurance Group Urges Denial of Freestanding ER Waiver

The waiver is "an obvious attempt to leverage a crisis in order to make a profit," a letter to Governor Abbott reads.

Earlier this summer, Freestanding Emergency Centers in Texas sought a waiver to provide non-emergent care during the pandemic, saying that would allow them to charge lower prices for COVID-19 tests. But the Texas Association of Health Plans, a health insurance trade association, is urging the state of Texas to clamp down on what they say is price gouging by the emergency rooms for COVID-19 tests. 

This month, ProPublica reported on a Texas facility that was charging nearly $2,500 for a $175 COVID-19 test. Facility fees and observation fees on the out-of-network bills range from hundreds of dollars to six figures and often result in excessive charges to insurance companies. 

Last year, Texas passed HB1941 that allows the Attorney General to take action against facilities that charge “unconscionable” prices, which are those that charge more than 200 percent than a hospital for a similar procedure. Washington created an emergency order that bans labs for billing insured patients for doctor-ordered COVID-19 diagnostic tests, and other states narrowly define what can be charged to insurers for tests. “It’s important that our state leaders exercise their authority to protect Texas families and employers. No Texan should have to worry about receiving a surprise bill or being price gouged for health care—certainly not during a global pandemic,” TAHP wrote. 

Concerning the waiver sought by the emergency rooms, TAHP sent a letter directly addressing the issue. Rather than expand the centers’ care, TAHP expressed concern about broadening licensure for Freestanding Emergency Rooms. “Expanding their licensure would only put more Texas patients at risk of being victimized by FSERs’ predatory behavior. Instead of expanding their scope of practice, Texas should investigate FSERs’ anti-consumer activities,” the letter says. It goes on to urge the prohibition of facility and observation fees for drive-thru and asymptomatic testing. 

TAHP also argues that while FSERs have to charge for emergency care, there is no basis for how much they need to charge or need to change observation or facility fees. “Facilities providing COVID tests to people who have no symptoms should be prohibited from charging ‘facility fees’ in connection with those tests. Providing a COVID test to a person with no symptoms is clearly not an ’emergency’ and does not even require a ‘facility.’ In fact, some FSERs are charging facility fees for non-emergency drive-thru testing performed in the facility’s parking lot,” it says. 

The letter argues that is FSERs want to treat as an urgent care facility; they could use the “dual door” practice where the facility has two different entrances for patients to choose from, allowing them to receive urgent care. 

The letter asks the governor not to extend the waiver to FSERs, and to use HB1941 to stop price gouging in Texas. “The proposed FSER licensure expansion is an obvious attempt to leverage a crisis to make a profit,” it reads.

Read the whole letter here