Hospitals and Hospital-Owned Clinics Add Facility Fees to Consumers’ Bills

By Consumers for Quality Care, on May 14, 2024

Hospitals and Hospital-Owned Clinics Add Facility Fees to Consumers’ Bills

Recent reporting by Stateline revealed that consumers across the country are often being charged hospital facility fees for a variety of services and procedures conducted in clinics and outpatient centers, even when those facilities are not located on a hospital’s campus.

Hospitals argue that facility fees are necessary to cover the cost of specialized medical equipment not typically found in other facilities. But increased consolidation has led to hospital systems adding facility fees to medical bills incurred in facilities they own, such as a clinic or a physician’s office. While these added fees typically range from $15 to $100, there are cases of consumers being charged over $500 in facility fees for procedures performed outside the walls of a hospital.

These facility fees result in higher costs for consumers. According to a 2023 analysis by Blue Health Intelligence, a division of the Blue Cross Blue Shield Association, consumers are more likely to be charged more for the same procedure conducted in a hospital-owned clinic compared to a doctor-owned clinic.

Fifteen states have already introduced bills or passed new laws to address the increased use of these fees. Some states prohibit the use of facility fees for certain services conducted outside a hospital, while other states require hospitals to inform consumers ahead of time whether facility fees will be charged.

Connecticut was the first state to ban facility fees for telemedicine visits and the state has some of the most stringent laws when it comes to these fees. State lawmakers, including Connecticut State Senator Saud Anwar, a practicing physician, are continually looking for ways to rein in the rising cost of health care. “These fees are part of the increased cost of health care. Facility fees … are a very fast-growing segment of that health care cost. We are looking for ways to control that,” said Senator Anwar.

CQC urges health care systems to stop charging absurd facility fees and urge lawmakers to combat these predatory practices that are increasing health care costs for consumers.