‘Facility Fees’ Add Billions To Medical Bills

Alan Bavley | The Kansas City Star | December 29, 2013

It was a minor skin infection. The visit to the dermatologist’s office at SSM Cardinal Glennon Children’s Medical Center took just a few minutes.

Before she left, Allison Zaromb paid $40 for her 4-year-old son’s care, the amount listed on her insurance card for an office visit to a physician specialist.

Zaromb assumed she had settled the bill, until a shocker arrived in the mail: After paying for the doctor, she still owed about $200 for a “facility fee” charged by Cardinal Glennon.

“I had no idea you would have to pay another fee because the doctor’s office was on a hospital campus,” Zaromb said.

“It’s just not fair. It’s like paying the barber for a haircut and then being charged extra for sitting in the barber chair.”

Fair or not, facility fees are built into the way Medicare and commercial insurance plans pay for health care. Hospitals have charged them routinely for years for services at their outpatient clinics.

But the fees are getting new scrutiny now that hospitals nationwide are buying up physician practices and putting thousands of physicians on their payrolls.