After Cleveland Clinic expanded to Florida, patients say surprise fees followed

NBC News

5 days ago

PORT ST. LUCIE, Fla. — When the Cleveland Clinic started acquiring hospitals and medical offices in this palm tree-lined region six years ago, many Floridians were excited. The Ohio nonprofit, ranked among the top hospitals in the world, pledged to bring expert care and an infusion of cash to the state's Treasure Coast, an area north of Boca Raton brimming with 55-and-up gated communities.
But in the years after the Cleveland Clinic's blue and green signs popped up outside dozens of medical offices, patients began receiving unexpected bills: an additional $95 for a consultation with a neurosurgeon. An extra $112 to see a family medicine physician. And $174 more for a neurologist appointment that previously cost only a $50 co-pay.
Baffled, the patients contacted their doctors' offices and insurers and learned that the new costs were 'facility fees' — charges that hospitals have traditionally billed for inpatient stays and emergency room visits but are now increasingly charging for routine appointments in their outpatient clinics. The fees, which are often not fully covered by insurance, are meant to support the higher level of care that these doctors' offices provide, according to hospitals.
For blindsided patients, that can mean paying a hospital fee — even if they never set foot in a hospital.
'My heart dropped,' said Brandy Macaluso-Owens, 43, a social worker who lives in Port St. Lucie. She received a $174 facility fee after a visit in March with a Cleveland Clinic gastroenterologist. 'I probably met with the doctor maybe as little as 15 minutes.'
The Cleveland Clinic defended facility fees in an email, saying they are an 'appropriate practice' that align 'with government regulations and industry guidelines.'
'These fees help support just some of the costs of maintaining outpatient facilities so that we can continue providing high-quality, compassionate care to all patients,' the Cleveland Clinic said.
The Cleveland Clinic is far from the only hospital charging facility fees, which amount to billions of dollars annually for patients across the country. The fees have become pervasive in recent years as major health systems have snapped up doctors' offices, making it harder for patients to find independent practices: More than half of all physicians nationally are now employed by hospitals or health systems, up from just a quarter in 2012.
For more on facility fees, watch NBC's 'Nightly News with Tom Llamas' at 6:30 p.m. ET/5:30 p.m. CT and 'Top Story' on NBC News NOW at 7 p.m. ET.
At the same time, facility fees have become more noticeable because of a rise in high-deductible health insurance plans, which leave patients paying a larger share of their medical bills before their insurance kicks in. A study last year found that the average deductible for employer-sponsored coverage had risen about 47% in a decade.
These factors are affecting many patients who are already teetering financially. About half of adults in the U.S. say they would be unable to pay an unexpected $500 medical bill or would have to go into debt to pay it, according to the health policy group KFF.
Facility fees can run into the hundreds of dollars, and even small amounts can quickly add up.
'People are getting really high bills for simple, routine care,' said Christine Monahan, an assistant research professor at the Center on Health Insurance Reforms at Georgetown University who has studied the issue. 'They don't expect to be paying high bills for this. And it's not realistic to expect people to be able to afford this.'
Opposition to outpatient facility fees is a rare area of agreement between patient advocates and insurance companies, which argue that hospitals are unnecessarily inflating the cost of care. While efforts to restrict facility fees have drawn bipartisan support at the state and federal levels, the hospital industry has pushed back, arguing that the fees are necessary to help fund core services like 24/7 emergency departments, and that insurers should cover them.
These national forces are all colliding in southeast Florida, where 11 patients told NBC News that the Cleveland Clinic had charged them unexpected facility fees in the past several years. For some, the fees were a mere annoyance, a sign of the escalating cost of health care. For others, the bills were a financial burden too big to shoulder. And some are refusing to pay them.
Billie Paukune Boorman, a waitress, was recently charged a $174 facility fee for her 13-year-old daughter's ear, nose and throat appointment, along with over $200 in other unanticipated charges.
'I don't have that kind of money laying around,' she said.
The Cleveland Clinic declined an interview request from NBC News and declined to comment on individual cases but said in its email that patients are charged facility fees in doctors' offices that are classified as hospital outpatient departments, which must meet stricter quality and safety standards than nonaccredited physician practices. The facility fees reflect 'the significant added costs to hospitals of complying with these standards,' the Cleveland Clinic added.
The Cleveland Clinic told NBC News that it has sent more than 250,000 letters to its Florida patients informing them of the fees ahead of their appointments, and said it posts signs at its offices saying that they are hospital outpatient departments. Medicare patients receive an additional notice at check-in. The letters that the Cleveland Clinic sent say patients may see 'a change from how you were billed in the past' but do not explicitly note that patients may be charged more out of pocket. Many of the patients who spoke to NBC News did not recall receiving the letters.
The health system did not answer questions about how it determines the price of a facility fee but said the costs 'vary depending on the facility and the type of medical services provided.'
Several patients said they did not notice any differences in their care after the fees were implemented.
Last year, Irene Rauch, 66, a semiretired human resources executive, was charged a $95 facility fee for an appointment with a neurosurgeon she said she had seen for the same type of appointment three months earlier for just a $15 co-pay. The added charge was not something she had budgeted for.