Up to 20% of Patients Visiting ERs are Not Even Treated
Introduction:
Emergency rooms (ERs) in the United States are required by law, under the Emergency Medical Treatment and Labor Act (EMTALA), to provide care to all patients, regardless of their ability to pay. This legal obligation leads many uninsured individuals, who cannot afford primary care, to depend on ERs for nonemergency services. This behavior significantly contributes to escalating healthcare costs, creates financial stress for hospitals, and results in overcrowded ERs, often with long wait times.
This study aims to take the most conservative definition of a nonemergency visit to the ER by identifying ER visits in Texas by specifically analyzing visits where no treatment was provided beyond a consultation with a clinician, referred to as “No Treatment Visits.”
Prior to the COVID-19 pandemic, approximately 20% of all ER visits in Texas are categorized as No Treatment Visits, and 99% of these patients were discharged with self-care instructions. During the pandemic, however, there was a sharp decline in nonemergency visits, which corresponded with an increase in ER revenue per visit. This suggests that many patients who had previously relied on ERs for nonemergency purposes avoided them during the pandemic, reinforcing the idea that these visits were not true emergencies.
During the COVID lockdown period, No Treatment Visits dropped by approximately 50%, indicating that these patients did not require emergency care and chose to avoid the ER due to perceived risks of virus transmission. The proportion of No Treatment Visits, referred to as “No Treatment Share,” fell from around 20% before COVID to as low as 13% during the pandemic. This decline in nonemergency visits directly contributed to improved ER financial performance, as the revenue per visit rose from below $150 before the pandemic to over $180 during it. For patients who received treatment, the average revenue per visit was about $200, while for No Treatment Visits, it was less than $50. Consequently, as the share of No Treatment Visits decreased, overall ER revenue per visit increased.
The COVID-19 pandemic provided a unique opportunity to examine ER usage patterns, particularly because it heightened the perceived risks of hospital visits, leading to a significant decline in nonemergency visits. The concurrent decline in No Treatment Visits and the rise in revenue per visit suggest that patients who had previously burdened the system with nonemergency care largely avoided the ER during the pandemic.
Background:
The challenges facing the US healthcare system—high costs, limited access to care, and financial difficulties for hospitals—are central to this study. ERs, as a crucial part of the healthcare infrastructure, are disproportionately affected by these issues. Many uninsured individuals, who cannot access affordable primary care, use ERs for nonemergency treatment, driving up healthcare costs, overcrowding ERs, and reducing the quality of care.
ER overcrowding has long been a major issue, leading to longer wait times and decreased quality of care. Studies show that overcrowding not only worsens patient outcomes by increasing the likelihood of errors and adverse events, but also imposes a significant financial burden on hospitals. Many patients who visit ERs do not pay for their care, further straining hospital resources. Before the COVID-19 pandemic, nearly 30% of ER visits were classified as charity cases, meaning hospitals received no payment for these services.
Addressing nonemergency visits is essential to improving both financial and patient outcomes. The study’s findings indicate that improving access to primary care facilities could greatly reduce healthcare costs and enhance hospital financial performance. Treating patients in primary care settings is far less expensive than treating them in ERs, and redirecting nonemergency patients to more appropriate care settings could ease the financial burden on hospitals and reduce overcrowding.
In addition, No Treatment Visits negatively affect hospitals’ revenue per visit. On average, revenue per No Treatment Visit is only $50, significantly lower than the $200 generated from visits where patients receive treatment. This large discrepancy in revenue underscores the financial challenges hospitals face in handling a high volume of nonemergency visits. For Texas ERs, which handle roughly 10 million visits annually, total revenue reaches approximately $1.7 billion per year based on Medicare prices, with an average revenue per visit of $168. However, when excluding charity visits, the revenue per visit increases to $221, highlighting the financial drain caused by charity cases and No Treatment Visits.
The Centers for Medicare & Medicaid Services (CMS) has pointed out the impact of non-urgent ER visits on excessive healthcare spending, unnecessary testing, and weakened primary care relationships. In 2018, CMS found that 18 million out of 27 million uninsured ER visits were for non-emergencies. This finding strongly supports the need to redirect non-urgent visits to lower-cost primary care facilities. The UnitedHealth Group (UHG) further estimated that managing nonemergency visits in primary care settings instead of ERs could result in savings of approximately $32 billion annually, based on an estimated cost reduction of $1,800 per visit.
Although this estimate may be somewhat higher than actual reimbursement rates, it highlights the potential for significant cost savings.
Research Overview:
This study defines nonemergency visits conservatively, focusing on No Treatment Visits where patients receive no care beyond consultation with a clinician. The data set includes 60 million patient visits to Texas ERs between 2017 and 2022, provided by the Texas Department of State Health Services (DSHS). The data offers comprehensive information on diagnoses, treatments, demographics, and payment sources, making it well-suited for analyzing ER trends over time.
The research methodology includes descriptive statistics, trend analysis, event studies, and difference-in-differences methods. During the COVID-19 pandemic, No Treatment Visits dropped by approximately 50%, while revenue per visit significantly increased. This trend strongly indicates that many nonemergency patients avoided the ER during the pandemic, supporting the conclusion that these visits were unnecessary.
Other data sources, such as Medicare reimbursement rates and ICD-10 diagnosis codes, were used to calculate revenue and categorize the types of treatments provided. One key finding is that the mix of treatments remained relatively unchanged before, during, and after the pandemic, aside from new COVID diagnoses. This suggests that the increase in revenue per visit was primarily due to the reduction in No Treatment Visits, rather than changes in the types of treatments provided with the exception of COVID related treatments, which did not increase revenue per visit.
The pandemic serves as a natural experiment, offering a unique chance to explore how an external factor, like the perceived risk of infection, affected the cost of visiting an ER. The results show that the sharp drop in nonemergency visits coincided with a rise in ER revenue, demonstrating the financial benefits of reducing No Treatment Visits.
The COVID-19 pandemic increased the perceived risk of visiting an ER, thereby raising the implicit cost for individuals considering an ER visit. This created an opportunity to study how ERs were being used, as individuals weighed the urgency of their medical needs against the risk of infection. As a result, many individuals with nonemergency conditions may have avoided the ER unless absolutely necessary.
This research employs event studies and difference-in-differences (DID) analyses to examine the effects of the COVID-19 pandemic on ER usage, focusing on the proportion of No Treatment Visits and Revenue per Visit. Event studies were conducted at both hospital and patient levels, comparing different categories of hospitals and patient groups, including Charity Visits and paid visits. The aim was to analyze how No Treatment Share and Revenue per Visit changed before and after the pandemic lockdowns.
The event study approach treats the COVID-19 lockdown as an external treatment, meaning that the lockdowns were independent events affecting ER visits regardless of other factors. The analysis compares ER data before and after the lockdown, using the first quarter of 2020 as the reference point. Three outcomes are evaluated: the number of visits, No Treatment Share, and Revenue per Visit. Regression results were then plotted to illustrate how these outcomes evolved over time.
Various subgroups of hospitals (large vs. small, rural vs. urban) and patient types (gender, race, Charity Visits) were also analyzed to assess whether trends differed across categories. One limitation of the event study approach is autocorrelation, where a variable may be correlated with itself over time; however, this issue was not tested in this dataset.
The difference-in-difference (DID) method was used to evaluate whether changes in No Treatment Share and Revenue per Visit were driven by differences in patient behavior or policy responses across jurisdictions. The DID approach compared outcomes in counties with formal COVID lockdowns (the treatment group) and counties without lockdowns (the control group). By comparing changes in outcomes before and after the lockdown in both groups, the study sought to isolate the effect of the lockdown policy itself. The DID analysis was performed using both the Balanced Panel (hospitals with continuous data across all periods) and the Full Population of ERs.
In summary, the study uses both event studies and DID methods to analyze the impact of the COVID-19 pandemic on ER usage, focusing on No Treatment Visits and Revenue per Visit. These methods enabled a detailed examination of changes in ER behavior during the pandemic, as well as an analysis of how different hospital and patient groups responded to these changes.
Research Results:
The results from both event studies and difference-in-differences analyses reveal a significant decline in No Treatment Visits during the COVID-19 pandemic, along with a substantial increase in revenue per visit. The reduction in nonemergency visits, combined with the consistent mix of treatments for patients who did receive care, suggests that nonemergency patients avoided the ER during the pandemic.
The difference-in-difference analysis, comparing counties with and without formal lockdowns, found no significant differences between them, indicating that the reduction in nonemergency visits was driven more by patient behavior than by policy interventions.
The event study results show that after the onset of COVID-19, ER visits decreased, while No Treatment Share dropped and Revenue per Visit increased. Prior to the pandemic, trends in No Treatment Share and Revenue per Visit fluctuated, with some quarters being statistically significant compared to the reference quarter (2020 Q1). However, once the pandemic began, a significant drop in No Treatment Share occurred, indicating fewer nonemergency visits.
Conclusion:
The findings of this study strongly suggest that the US healthcare system could achieve significant cost savings if patients seeking nonemergency care were redirected from emergency rooms to more affordable primary care facilities. Emergency rooms are a costly and inefficient setting for treating nonemergency conditions, as seen in the lower revenue generated from No Treatment Visits and the financial strain placed on hospitals. By providing better access to primary care options, many of the patients who currently rely on ERs for non-urgent needs could be treated in a more appropriate, lower-cost environment, alleviating financial pressures on hospitals and the healthcare system as a whole.
Shifting nonemergency patients to primary care facilities would not only reduce overall healthcare costs but also improve the quality of care provided in ERs. Overcrowded ERs are linked to longer wait times, increased medical errors, and worse patient outcomes. Reducing the volume of nonemergency visits would allow ER staff to focus on true emergencies, improving the timeliness and quality of care for patients who need it most. This shift could also enhance the working conditions for clinical staff, reducing burnout and improving job satisfaction.
From a financial perspective, reducing No Treatment Visits would improve the revenue per visit for ERs, as hospitals would be able to focus their resources on patients who require treatment and generate higher revenues. This would lead to better financial performance for ERs, which are currently strained by the high volume of uninsured and charity cases. In the long term, redirecting nonemergency visits to primary care settings has the potential to save billions of dollars annually, improve the financial health of hospitals, and elevate the overall efficiency and effectiveness of the US healthcare system.
By addressing the root cause of nonemergency visits to ERs—namely, the lack of accessible and affordable primary care—the US can make substantial strides in controlling healthcare costs, improving care quality, and enhancing hospital performance. Further investment in primary care infrastructure is essential to achieving these goals.
