Thursday, February 9, 2023

Traditional, hospital emergency rooms: Are they economically viable?


Hospitals as we know them in the United States are struggling with financial viability as they are caught between the pinchers of providing healthcare gratis to ER walk-ins and the die-off of private, healthcare insurance.

At this time, hospitals are not allowed to refuse medical care to a patient who enters their Emergency Room. Think about it, a patient might be so ill that they are unable to communicate their insurance coverage. The hospital treats them anyway and then attempts to recover their costs.

The other jaw of the vise is that Obamacare vaporized healthcare-as-we-knew which stratified risk and allowed insurance companies to deny coverage based on preexisting conditions it but said it would all be OK because the law passed by Congress and signed by Obama had mandates that penalized every American who did not have Obamacare compliant coverage.

The public was enraged when they saw what "their fair share" of Obamacare was and Congress repealed the mandates but left the parts about not stratifying risks and preexisting conditions in place.

So we now have a system where a very large portion of the population is either not covered at all or is covered by Medicaid which does not pay enough to cover the economic cost of coverage.

Furthermore, we have a system where a person can roll-the-dice and not pay into the system while young and healthy but can apply for coverage while in the ambulance on the way to treatment** and thus qualify for Lexus-level coverage.

The hospital systems, a very important part of the ecosystem that provides healthcare to nearly every American, are reeling.

Delivery of healthcare through the Emergency Room setting is astronomically expensive compared to other healthcare venues.

One attempted solution

Sparrow Hospital is the dominant hospital system in Lansing, Michigan. Their main campus is located on the eastside of downtown and is within easy walking distance of the homeless center, bars, weed shops and sex-workers.

Homeless camp in Lansing, Michigan 3700 feet walking distance from Sparrow Hospital Emergency Room

On cold nights the hallways are clogged with homeless people* sleeping on gurneys having been admitted by reciting a litany of symptoms they know will get them admitted for the night. The fact that the labs will be swamped and many diagnostic tests will not be run in a timely fashion (they are being TREATED, don't you know) does not bother them but can be problematic for patients who really are suffering chest-pains.

On nights when "the checks" hit the bank accounts, there are waves of calls from the residential neighborhoods where recipients of those funds decide that riding an ambulance over to Stober's bar beats the hell out of walking or waiting for the bus.

Sparrow Hospital's solution was to open an Emergency Room in Okemos eight miles from the main campus. The new Emergency Room is far away from titty-bars and other attractions and it will remain that way because it is close to a school complex. It is also not supported by much of a facility which necessitates boxing-up and shipping out serious issues to the main campus.

All of the professional medical people were flabbergasted by the decision. From their viewpoint, it was rock-solid-stupid.

But from the standpoint of it being an intermediate step toward closing down the Emergency Room at the main campus it makes all of the sense in the world. It is a filter and a triage center. It also happens to be located in Lansing's most affluent suburb and presumably the population with the highest percentage of private healthcare insurance. 

The business model would be to only allow patients with a referral from an approved, medical professional to be admitted to the main campus.

*You can usually tell by the condition of their socks. Dirty socks/feet = Homeless.

** Kubota was recently a passenger in a vehicle that was involved in a traffic mishap where the vehicle he was riding in was totaled. The cop who responded looked at the driver and KNEW he was not insured. The cop said "I am going to investigate the accident scene before I take your information, so while I am over there looking at that your insurance carrier and bring your account up-to-date."

The driver did and the insurance company did, indeed, verify that the driver was paid-in-full and the driver had coverage when the cop tapped the query into his computer.

Had Kubota been injured in the accident (he wasn't), his medical bills would have been covered by the car insurance carrier.


  1. As a former customer of Obama care, vice/vise, hmmm.
    Still a little east of Paris ...

    1. I am making a good salary from home $1300-$2600/week , which is amazing, under a year back I was jobless in a horrible economy. I thank God every day I was blessed with these instructions and ADq now it’s my duty to pay it forward and share it with Everyone,
      Here is what I do…. ……………..

  2. A good policeman, allowing a little insurance clean up before starting the processing.

    As a side note CHECK your Workers Insurance before letting them work at your home.

    When I asked the boss about it, he said his cousin was responsible for carrying HIS Own Workmans insurance. I.E. The Boss didn't pay for it.

    When I pushed the question and even disallowed a "Cousin" to be on my property until a Proof of Insurance was done, he was gone for two days.

    Showed up with Proof dated the day he returned. So. a little "cost cutting" by not paying it, eh?

    1. A cop enabling insurance fraud.

    2. That is the way I see it, too. It raises rates for those of us who do it right.

      Conceivably, since a person is not officially "dead" until declared so by a credentialed person it would by fine to buy additional life insurance for somebody who had been run through a wood-chipper but before they were declared dead.

  3. ERJ, Sara Hoyt published a thought provoking piece last week entitled "You Get Nothing" in which she noted that free cannot go on forever or is the only option. Sometimes, the outcome is the thing simply goes away - you get nothing.

    The other, of course, is that you need skilled professionals to manage and be engaged. You cannot make people work, no matter how much you pay, if the environment is awful and they are treated poorly.

    Good job Sparrow Hospital in trying an innovative idea. I have seen other emergency rooms locally away from hospitals - I wonder if it is driven by the same dynamic?

  4. Washington State is one that requires car insurance, but there is a firewall between enforcement and the companies. If the one that causes a wrong does not have a policy number, either current or expired, the law will make no effort to aid the victim in tracking it down.
    Washington also lead the way to Obama care when back in the early '90's required insurers to cover things like AIDS treatment & sex change related things. Rates rose rapidly, and many companies stopped doing business in the state.
    Did the medical field reap what they sowed via the unintended consequences when Obamacare came to be? "Finally, we'll get paid what it's "worth"!" Except maybe they were being paid what it was worth, and now it's just bloated bureaucracy? Several of my wife's peers jumped into the "medical records recording" field profession. Which was great for a brief couple years, until the doctors & hospitals switched to asian based data entry to cut cost. My (few) experiences have been as much or more time spent with the clerk entering data (which is just a repeat of the information already present in the file) than with the brief time with doctor.
    I still stand by "If you don't have bone sticking out, or bleeding from an orifice, doctors are just guessing in "practicing" medicine.

  5. Actually, the driver's insurance would not have covered Kubota at all unless they were related to each other living in the same household. Kubota's car insurance would be responsible for his injuries. If he had none, then the car insurance of a relative who lived with him would have covered his injuries. If he did not have a resident relative, the State's Guarantee Fund would cover his injuries. Unless the driver was a relative who lived in the same house as Kubota, the driver's coverage would only cover the driver.

    1. doesn't that depend on the state you are in or the state of your residence?

    2. Probably correct. Kubota might have had to sue the driver personally and the driver's insurance company may or may not have been on the hook.

    3. Mr. ERJ lives in Michigan. My answer is for Michigan. And is based on my 45 years as an insurance agent.

  6. A major issue with emergency rooms is that under EMTALA they must treat and stabilize everyone that comes in, without any expectation for payment for the treatment - at the hospital's expense. This is partially why you see crazy charges on paying people's bills like $50 for an iv bag of saline drip - it's to try and recoup some of the costs left by the non-paying frequent fliers, and Obamacare has made this even worse.

  7. As long as the EMTALA act is in force hospitals will be forced to shift costs from parasites demanding service to paying patients. As the number of people who are insured drops the costs for those who pay MUST rise. What cannot continue won't. Eventually the system must collapse. The result will be socialized medicine similar to what we see in Canada, the UK etc. In other words NO healthcare for the average person.

    1. That's what Medicare and Medicaid do too. They don't cover the true costs, and the medical providers charge everyone else (private insurance or self-insured) more to make up the difference.

      I can understand why Medicaid can't pay its true costs (it's essentially medical welfare), but I don't understand why Medicare was/is so poorly managed that it can't too. We all paid a lot of money into the system for decades.
      Most of us over 65 depend on Medicare in one form or another, unless you've got TriCare/VA or are still working for an employer who covers most of the cost of their insurance.

  8. Don't be a paying patient. Don't be a patient if you have the option, don't pay if you're somehow forced to go there.

  9. don't ride with the uninsured!
    if necessary pay a month's insurance on your ride's vehicle

  10. Make cash on-line from home further money quite $18000 to $21000. begin obtaining paid each month op Thousands greenbacks online. I actually have received $26000 in this month by just operating online from range in my half time. U12 one and all simply try this job by.

    just Open This Website…..>

  11. One solution is to allow hospitals to deny service to illegals, drunks, and junkies. Quit allowing naloxone to be given to "frequent flyers." If people are going to take risks, they should be responsible for those risks, not the rest of us.

    1. Aesop over at Raconteur's Report Blog is a nurse in an Emergency Room in Orange County, Ca. His solution is to tattoo a "D" on the forehead of the psychotic crack-head the first time they come into the ER. Then the letter "N" the second time they show up and cannot pay. Then the letter "R" the third time.

      It works in Baseball. Three strikes and you are out. The fourth time the druggie/drunk comes into the ER the staff sees the "Do Not Resuscitate" directive tattooed on the forehead and they honor it.

    2. Are they taking applications for tattoo technicians?

  12. Eventually the “free” service goes away, always. Every time.
    I had the joy of receiving care many years ago in the UK, if you came in on a Friday night with a broken limb it was splinted and you were told to come to the fracture clinic either Monday or Tuesday. Hip replacements were deemed elective until the pain was so great that a wheelchair was required, then, and only then, you’d get put onto the list, the list could be 24 months long, hernias were only surgically repaired after they had strangulated and became life threatening. My appendix was removed 16 hours after my arrival at the hospital by which time it had burst. I was in a ward with 7 other men.
    Today going to a British emergency room is a roll of the dice, there simply isn’t the capacity to offer care to all those demanding it.
    Thanks to administrative bloat, Obamacare, a tort system run amok etc, we’re all headed towards a similar system


Readers who are willing to comment make this a better blog. Civil dialog is a valuable thing.