Man Fights Back Against Hidden Hospital Facility Fees

Ben Federico is 78-years-old and he is a fighter. He has had a heart attack, septic shock, MRSA and pneumonia three times.

But his new battle is against Yale-New Haven Hospital for an extra cost he was blindsided by when he got a semi-annual check-up on his heart.

The charge is labeled as a co-pay on the bill, but Federico's regular co-pay is only $40. The $124 charge is actually a facility fee.

"I don't understand a facility fee, is it paying the rent? What is a facility fee?" Federico asked, staring at the unexpected charge.

The doctor who performed his EKG is a Yale-New Haven Health Systems affiliated physician, which means the hospital is able to attach facility fees to Federico’s bill, even though he sees his doctor at an office in Branford.

"We know it's frustrating for consumers. It's very difficult to understand," said Vincent Petrini, the senior vice president of public affairs at Yale-New Haven Health System.

Petrini explained that if a hospital owns a practice, facility fees can be applied.

"Yale-New Haven Health System now pays over $180 million dollars in taxes in the state of Connecticut," Petrini said. "We now get paid 28 cents on the dollar due to Medicaid cuts across the state."

Petrini also said the hospital gives away "$130 million in free and discounted care."

In a 2014 report by the Connecticut Attorney General’s office, experts said:

"Hospitals contend that facility fees are used to cover their overhead costs for things like imaging equipment, electronic health records, and care for the uninsured."

However, critics contend that "facility fees are a means to enable hospitals to earn more revenue for a simple office visit, which flows right to the hospital’s bottom line."

Although facility fees have been around for years, this particular facility fee only became a concern in recent years.

Connecticut Attorney General George Jepsen explained that in 2009, a law passed in Connecticut that allows hospitals to acquire previously independent physician groups. As they do, complaints from patients pour in.

"The service is the same. It's at the same location, and all that has changed is there is a little affiliation on the door with a particular hospital system and all of a sudden they are hit with a sometimes exorbitant facility fee for exactly the same service," Jepsen said.

He warned that as hospitals continue to form affiliations with independent physicians and other hospitals, people will end up paying more.

"That gives the hospitals a lot more bargaining power than before to extract the kinds of payments that they are demanding from insurance companies," Jepsen said.

Yale-New Haven Health System is affiliated with Bridgeport and Greenwich hospitals, an official with Yale-New Haven Health System said Bridgeport Hospital does not charge this type of facility fee. However, at Greenwich Hospital, there is "one off-site Oncology practice where we do facility fee billing."

Petrini added Yale-New Haven Hospital only charges the facility fee Federico got hit with to Medicare patients.

"We do not apply them in commercial patients because we're able to waive those," Petrini explained. "But, under Medicare guidelines, we do charge those patients that are Medicare insured."

Federico thinks that’s unfair.

"We're the one that are on fixed incomes. We're retired, we're elderly. I think it's terrible," Federico said.

We asked Petrini if that policy might be driving away Medicare patients.

"That's why we will work with patients directly," Petrini said. "We don't want cost to be a barrier to care in anything we do."

However, the $124 facility fee is a barrier for Federico. After we visited him, he was hit with a second facility fee from Yale-New Haven Hospital for another routine visit.

"I asked for my records and I had them transferred to my primary care doctor, who is not affiliated with Yale," Federico said.

He added that the decision to leave his doctor of nearly 20 years was a hard one.

"I did like my doctor that was affiliated with Yale very much so, but I can’t afford that $124.39," he said.

"It's anti-consumer is the bottom line," Jepsen said.

He explained that hospitals are required by law to inform patients that they could charge a facility fee.

Federico said that didn't happen in his case. Although he signed a form from Yale-New Haven Health System agreeing to pay for any costs his insurance did not cover, the form did not mention a facility fee.

"I don't see facility," Federico said, looking at the form. "Where is a facility fee?"

When the NBC Connecticut Troubleshooters notified Yale-New Haven Hospital officials of Federico’s experience, they reversed both facility fee charges.

"The Department of Health said they couldn't help me, The Attorney General said they were looking into it, but you were the main one, you're the one that helped me out," Federico said, thanking the NBC Connecticut Troubleshooters.

There are many different kinds of facility fees and people need to check with their medical provider to see if they will get charged any other facility fee.

Starting in 2017, a law goes into effect that will eliminate facility fees for doctor office visits entirely. If anyone wants to dispute a facility fee, they can send in the form provided to the Connecticut Attorney General.

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