Hospitals charge new fees with a new type of department

Kaiser Health News reported on how the hospital landscape might be changing with the addition of a new department: obstetrics emergency departments (OBEDs). Apparently, visits to these new departments can cost over a thousand dollars, without patients even realizing that they incurred a new fee. The article strongly suggests that these fees are likely to be engineered for hospitals to extract more money while not providing better patient care. For example, the article points out that a selling point for hospitals to adopt these new departments is "'boosting hospital revenues' with 'little to no structural investment for the hospital.'" The medical personnel who are quoted in the article seem skeptical of how these new departments enhance patient care, although various marketing and communications personnel made positive statements about the practice.

For now, it seems that these visits are relatively rare, although they appear to be growing in frequency. However, given the large amounts of money that are in health care, it is not surprising that private equity firms are investing in companies that help hospitals grow their profits. Theoretically, insurance companies have an incentive to stem these practices, but it is possible that these particular charges are small enough for them to not worry about -- at least for now. There is already widespread dissatisfaction with how expensive health care is, and it is unclear how awareness of tactics like these might result in changes to the regulatory or competitive environment for the industry.