Colorado Springs doctors carving lower-cost niche between urgent care and emergency room

Aug. 05--In her previous job, Dr. Julie Marmon patched up patients only to have them return with a complaint.

"'We really loved your care,'" Marmon recalled them saying. "'But you just charged me $6,000 for five stitches in my hand. This is crazy.'"

She agreed.

In opening a competing clinic, Marmon, 44, and three other emergency room doctors want to shake up the business of emergency medical care while avoiding billing practices that many experts label as deceptive.

The place is called ER Specialists Urgency Center. And it's carving a niche between low-cost urgent care clinics that treat minor ailments and glitzy freestanding emergency rooms known as much for their sky-high prices as their life-saving care.

The new clinic appears to have little precedent in Colorado.

"Somebody's got to apply pressure to the health care system," Marmon said. "Why not us?"

Health policy experts voiced guarded optimism for the concept.

"If in fact it allows them to offer care that isn't as expensive, and also has more services than an urgent care, maybe that's the best of both worlds," said Edmond Toy of the Colorado Health Institute, which researches health care issues.

The approach highlights the price hikes -- which many deem unneeded -- found at many freestanding ERs, said Britt Berrett, who oversees the University of Texas at Dallas' undergraduate health care management studies and studies such clinics.

"This is very unique -- very innovative," Berrett said, commending the move.

Still, Berrett said ER Specialists should go even further by posting its pricing structure online, as an added means of accountability.

"The old axiom 'buyer beware' is very important," Berrett said. "What buyers need to be demanding is greater access to pricing transparency."

At the clinic, patients can be treated for almost everything -- headaches and fevers, severe cuts, stomach or chest pain, asthma, broken bones and head injuries.

The center has an in-house lab and can deliver babies in an emergency and can send more severe cases to a hospital emergency room or directly admit patients to a hospital.

It all bears striking similarities to a freestanding emergency room, which offers almost all the services its name would suggest, without being physically attached to a hospital.

All four doctors worked at a freestanding ER in Fountain, UCHealth Emergency Room. But they left amid dissatisfaction with that clinics' billing practices. The clinics have garnered intense criticism in recent years for charging exorbitant prices for minor maladies by tacking on "facility fees" to their patients' bills. The extra costs are associated with their designation as an emergency room, and can hike a patient's tab by $1,500 or more.

Health policy experts say such billing practices jack up health care costs in the name of improved revenues.

It wasn't much fun for physicians and nurses, and it added to the stress of an already hectic environment, said Dr. Linda Sturtevant, one of the four doctors, now with ER Specialists.

"The place was so busy, we couldn't take a break," Sturtevant said.

Their new clinic's prices range from $125 to $2,750, compared with up to $10,000 in a hospital emergency room. Expected costs for each visit can be given when patients walk through the doors, Marmon said.

It also comes without the hourslong wait associated with traditional hospital emergency rooms.

"We are a safety valve of sorts," Marmon said. "Patients sometimes have to wait five or six hours to be seen in a hospital emergency room."

UCHealth entered into a partnership with Adeptus Health to run the clinics where Marmon and her colleagues formerly worked.

In a statement, a UCHealth Memorial Hospital spokeswoman Cary Vogrin said the facility fee is critical to helping its freestanding ERs remain open 24 hours a day, year-round, while also helping pay for medical training and other "behind-the-scenes" services. She also said recent emergency room wait times have averaged minutes, not hours.

ER Specialists only accepts patients 12 hours a day -- opening later than most urgent cares, but also closing later at night.

It accepts cash payments and insurance coverage from Anthem, Cigna and Humana.

It also accepts patients with Medicare and the military Tricare program, Marmon said, though reimbursement rates vary, because it isn't a fully participating provider with those programs.

Marmon said the four doctors turned down an offer from health insurance giant Kaiser Permanente to run a similar facility in Aurora that would offer a higher level of care without emergency room rates. They wanted to stay in Colorado Springs.

The four doctors paid $1.9 million last summer for a former ANB Bank branch and borrowed $3.9 million from the bank to convert the 14,600-square-foot building into a state-of-the-art medical clinic with eight exam rooms, according to El Paso County land records. Three more rooms at the building are leased to an allergy clinic. They converted the former bank vault to an imaging room equipped with both the CT scanner and X-ray equipment.

The center employs 26 employees, including the four doctors, several nurses and others.

It is similar to an urgent care center, in that it is not subject to licensure by the Colorado Department of Public Health and Environment. By contrast, freestanding ERs must be licensed with the agency.

Marmon said patient numbers at ER Specialists have been increasing gradually since opening in February, mostly from word-of-mouth referrals since the center hasn't done much advertising or marketing, and is nearing breaking even.

"We believe that practicing great medicine and offering an alternative at lower cost to the patient will keep us in business," Marmon said. "But it's hard, there's no doubt about it. We look at the bottom line constantly."

They're banking on an overall experience that doesn't end in more stress.

"This was kind of a venture in 'We need to take medicine back,'" Sturtevant said.

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