By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works CollectiveHealth Works Collective
  • Health
    • Mental Health
    Health
    Healthcare organizations are operating on slimmer profit margins than ever. One report in August showed that they are even lower than the beginning of the…
    Show More
    Top News
    improving patient experience
    6 Ways to Improve Patient Satisfaction Within Hospitals
    December 1, 2021
    degree for healthcare job
    What Are The Health Benefits Of Having A Degree?
    March 9, 2022
    custom software development is changing healthcare
    Digital Customer Journey Mapping and its Importance for Healthcare
    July 21, 2022
    Latest News
    Grounded Healing: A Natural Ally for Sustainable Healthcare Systems
    May 16, 2025
    Learn how to Renew your Medical Card in West Virginia
    May 16, 2025
    Choosing the Right Supplement Manufacturer for Your Brand
    May 1, 2025
    Engineering Temporary Hospitals for Extreme Weather
    April 24, 2025
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
    Policy and Law
    Get the latest updates about Insurance policies and Laws in the Healthcare industry for different geographical locations.
    Show More
    Top News
    Can Thinking Younger Make You Live Longer?
    April 20, 2011
    Image
    Obesity’s Outlook Unchanged
    June 13, 2011
    When It’s An Emergency Elderly Not Treated As Well in Hospitals
    July 16, 2011
    Latest News
    Building Smarter Care Teams: Aligning Roles, Structure, and Clinical Expertise
    May 18, 2025
    The Critical Role of Healthcare in Personal Injury Recovery: A Comprehensive Guide for Victims
    May 14, 2025
    The Backbone of Successful Trials: Clinical Data Management
    April 28, 2025
    Advancing Your Healthcare Career through Education and Specialization
    April 16, 2025
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: America Spends More on Emergency Medicine Than Previously Thought. Good or Bad?
Share
Notification Show More
Font ResizerAa
Health Works CollectiveHealth Works Collective
Font ResizerAa
Search
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Business > Finance > America Spends More on Emergency Medicine Than Previously Thought. Good or Bad?
BusinessFinanceHospital AdministrationPolicy & LawSpecialties

America Spends More on Emergency Medicine Than Previously Thought. Good or Bad?

Brad Wright
Last updated: May 19, 2013 4:11 am
Brad Wright
Share
6 Min Read
SHARE

American emergency departments take a lot of heat from critics who assert that they are one of the places in our health care system where resources are wasted in abundance. These arguments have less to do with the emergency departments themselves, and more to do with people using emergency departments for non-emergent conditions. One estimate puts the excess spending at $38 billion a year.

American emergency departments take a lot of heat from critics who assert that they are one of the places in our health care system where resources are wasted in abundance. These arguments have less to do with the emergency departments themselves, and more to do with people using emergency departments for non-emergent conditions. One estimate puts the excess spending at $38 billion a year. By contrast, the American College of Emergency Physicians (ACEP) claims that care received in emergency departments accounts for only 2% of national health expenditures. However, new research from Michael Lee and colleagues appearing in the Annals of Emergency Medicine, finds that, because of data limitations, previous estimates of emergency department spending are misleading.

The 2% figure appears to be based on a faulty interpretation of the Medical Expenditure Panel Survey (MEPS) conducted by the Agency for Healthcare Research and Quality. The MEPS figures that ACEP uses for their calculations did not include more expensive admitted patients (only those that were seen in the ER and released), did not include institutionalized patients such as elderly nursing home patients, and significantly undercounts the total number of ER visits nationally compared to a number of other established surveys.

In their study, Lee and colleagues use a variety of data sources and construct estimates using several different assumptions to generate a more reliable range of emergency department spending in the U.S. Their conclusion is that emergency department care likely represents 5 or 6% of national health expenditures, although the true figure could be as high as 10%. That’s a figure 3 to 5 times as great as what the American College of Emergency Physicians is reporting, so it’s safe to say that, to the extent one trusts these new numbers (and I do), the argument that emergency care isn’t a big contributor to national health expenditures pretty much falls apart.

More Read

Book Summary: The Future of Health Care Delivery
Multi-Screen Marketing: 17 Things You Need to Know
FDA Shuts Down over 1600 Web Sites Selling Counterfeit and SubStandard Drugs
The Second Wave of Healthcare Informatics
AMA: Pay Docs for Care Coordination

What is left, then, is the question of whether that level of spending is inherently wasteful. On this point, the authors review the economic literature on the costs of providing emergency care. The accepted paradigm had been that the ER was a high fixed cost, low marginal cost enterprise. But the authors show that empirical studies testing that hypothesis using regression analysis have been variable and poorly designed. They favor an accounting-based approach rather an econometric one, using principles from time-driven activity based accounting popularized by Kaplan and Porter. That approach puts greater emphasis on the scalability of resources such as labor, space and equipment that might otherwise be viewed as fixed.

I asked Lee about the implications for policymakers from their line of work:

On the topic of diverting low acuity care: “Diverting low acuity visits may save payers some money but I’m skeptical that there would be large aggregate savings….Studies that look at ex-ante measures of severity or urgency (as opposed to diagnosis-related measures which are ex-post) generally show that the volume of non-urgent care is lower than the public perceives. And a further point is that the actual reimbursements for non-urgent care is likely to be on the low side to begin with since it’s a population more likely to be uninsured or underinsured. Finally, you have to also take into account the fact that primary care offices and clinics may not have the capacity to see high volumes of unscheduled care, so diverting care will simply shift the cost burden. I think there is far more promise in understanding and questioning expensive decisions ER physicians make such as admitting patients to the hospital or the volume of diagnostic testing ordered.”

Lee and his co-authors want to move beyond the issue of minimizing costs, however, and in their paper they call for a greater emphasis on value, writing:

“With 130 million visits, 28% of all acute-care visits, and accounting for nearly half of all admissions, emergency medicine should be expected to represent a large share of health care spending….More attention should be devoted to quantifying the value of specific aspects of emergency care. Rather than minimize the issue of cost, we should recognize the economic and strategic importance of the ED within the healthcare system and demonstrate that costs are commensurate with value.”

Lee acknowledges that this remains a challenge for the field of emergency medicine. “The core of our business is ruling out critical diagnoses. Many of the things we look for are low probability but highly dangerous conditions. The big question is how do you quantify value when your work is often focused on trying to demonstrate the absence of something?”

 

TAGGED:emergency medicine
Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

Clinical Expertise
Building Smarter Care Teams: Aligning Roles, Structure, and Clinical Expertise
Health care
May 18, 2025
Grounded Healing: A Natural Ally for Sustainable Healthcare Systems
Grounded Healing: A Natural Ally for Sustainable Healthcare Systems
Health
May 15, 2025
Learn how to Renew your Medical Card in West Virginia
Learn how to Renew your Medical Card in West Virginia
Health
May 15, 2025
Dr. Klaus Rentrop Shares Acute Myocardial Infarction heart treatment
Dr. Klaus Rentrop Shares Acute Myocardial Infarction
Cardiology
May 13, 2025

You Might also Like

African Conference Highlights Government Subsidized Healthcare Delivery

September 5, 2012
obamacare
Health ReformNewsPolicy & Law

Ted Cruz Filibuster Misses the Mark

October 15, 2013

The Global Burden of NCDs – Our Future Public Health Legacy?

October 20, 2011

Dialysis Side Effects: How to Deal

August 15, 2013
Subscribe
Subscribe to our newsletter to get our newest articles instantly!
Follow US
© 2008-2025 HealthWorks Collective. All Rights Reserved.
  • About
  • Contact
  • Privacy
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?