Emergency Care Bill Proposes Medicare, Medicaid Coverage for Freestanding ERs: Aims to Formalize Pandemic Practice, Cites Cost Savings

The "Emergency Care Improvement Act" is on the table, and it's looking to make a significant shift in how and where you can use your Medicare or Medicaid for emergency services. At its core, this bill aims to formally bring freestanding emergency centers (FECs) – those standalone ERs you might have seen that aren't physically attached to a large hospital – into the Medicare and Medicaid payment systems. This isn't entirely new; during the COVID-19 pandemic, many of these facilities were temporarily allowed to bill Medicare. This bill seeks to make that a more permanent arrangement, laying out specific rules and requirements for these centers to participate.

What Makes an ER 'Freestanding' and Eligible?

So, what exactly does this bill consider a "freestanding emergency center"? It's not just any clinic with an 'Emergency' sign. According to Section 3, to get the green light for Medicare and Medicaid, an FEC would need to be a licensed, independent emergency department, staffed 24/7 with a physician ready to provide emergency care. Think of it as having the core capabilities of a hospital ER, but in a separate building. They'll also need to have agreements with nearby hospitals for patient referrals and admissions if more intensive care is needed (as per Section 1866 of the Social Security Act).

There are also rules about where these FECs can be located. Generally, they need to be in a metropolitan area. However, there are exceptions for rural counties: if an FEC was set up before 2022 in a rural county, it can qualify. For new FECs (established January 1, 2022, or later) in rural counties, they can only qualify if that county doesn't already have a Medicare-certified hospital or a rural emergency hospital. This detail in Section 3 suggests an effort to expand access in underserved rural areas without duplicating existing hospital services. Finally, these FECs must meet state-specific requirements for facilities providing emergency medical services for stays typically not exceeding 24 hours and adhere to a data-driven quality improvement program. The Secretary of Health and Human Services can add other requirements, but they can't be stricter than what's already asked of off-campus emergency departments of existing hospitals (under 42 CFR 482.55).

The Nitty-Gritty: Covered Services and Patient Protections

If an FEC ticks all those boxes, what kind of care gets covered? The bill specifies "specified emergency services," which generally means the kind of care you’d expect in an emergency situation, as defined in section 2799A1(a)(3)(C) of the Public Health Service Act. However, there's a notable exclusion: very low-level evaluation services (identified by HCPCS codes 99281 through 99282) won't be covered. This means if you go to an FEC for something extremely minor, that initial assessment might not be paid for by Medicare or Medicaid under this new setup. For example, if you went in for what you thought was a serious issue, but it was quickly determined to be a very minor sprain coded at the lowest level, that specific initial evaluation service might not be covered.

A crucial piece for patients is that these FECs would be brought under the Emergency Medical Treatment and Labor Act (EMTALA), as per amendments to Section 1867(e) of the Social Security Act. This is a big deal. EMTALA is the federal law that requires hospitals with emergency departments to provide a medical screening examination to anyone seeking treatment for an emergency medical condition, regardless of their insurance status or ability to pay, and to stabilize them or arrange an appropriate transfer. Bringing FECs under EMTALA means they’d have the same legal obligations. So, if you show up at a participating FEC, they’d have to assess you and provide necessary stabilizing care, just like a traditional hospital ER.

Dollars, Cents, and Referrals

How would Medicare pay these FECs? Section 3 amends section 1833(a)(2) of the Social Security Act to state that payments will be determined under the same system used for hospital outpatient department (OPD) services. The bill's findings (Section 2) highlight a study suggesting FECs saved Medicare about 21.8% on emergency care payments for similar patients during the pandemic, so the payment structure aims to reflect or continue these potential efficiencies.

Interestingly, the bill also carves out an exception to the physician self-referral laws (often called the Stark Law). As amended in Section 1877(b) of the Social Security Act, laboratory and imaging services provided by an FEC in connection with these covered emergency services would be exempt. This means if a doctor who has an ownership stake in an FEC refers a patient for an X-ray or lab test at that same FEC during an emergency visit, it wouldn't violate Stark Law. This could streamline care within the FEC but is an area that often sees scrutiny to ensure patient care isn't unduly influenced by financial incentives.

Overall, this legislation formalizes a care model that got a trial run during the pandemic. For you, it could mean more choices for emergency care, especially if an FEC is closer or more convenient than a hospital ER. The inclusion under EMTALA offers important patient protections. However, the exclusion of very low-level services is a detail to watch, and how the payment models and Stark Law exceptions play out in practice will determine the true cost-effectiveness and impact on the broader healthcare landscape, including traditional hospitals who might face new competition.