Authored by: Theresa Radeker, MHA, BSN, RN, TCRN, Senior Consultant
Specialized trauma care plays a crucial role in providing patients with rapid and comprehensive treatment, necessitating a continuous and uninterrupted commitment from trauma centers. However, the imposition of trauma activation fees has drawn increased scrutiny from patients and regulatory authorities, raising concerns about fairness and transparency in billing practices. This article explores the importance of properly defining charges for trauma care and emphasizes the need for ethical billing practices that benefit both patients and healthcare providers.
The costly commitment
Trauma centers shoulder immense financial commitments, including contracting with skilled surgeons and providing access to various medical services such as operating rooms, radiology, laboratory, and blood bank facilities. These expenses can exceed $10 million annually, varying depending on the trauma center’s designation level. Historically, trauma center resources were not covered by service fees, but in 2002, the Trauma Center Association of America successfully advocated for trauma response fees and critical care codes.
Addressing disparities in fees
Unfortunately, an unregulated environment has resulted in widely disparate fees across the country, with some hospitals charging exorbitant amounts for trauma activation. This inconsistency has led to high-profile cases of patients receiving minor treatments but facing substantial activation fees, creating a need for fair and transparent billing practices.
Determining these costs should be relative to the “state of readiness” required by the specific trauma center. For example, Level I readiness is more resource intensive than Level III readiness. While an annual net revenue from trauma center activation fees might typically fall between $3 million and $4 million, an unregulated environment has resulted in broadly disparate fees across the country with some hospitals seeing a profit of nearly $24 million – based on exceptionally high activation fees. In fact, charges can range from $1,000 to $61,734 according to a cross-sectional investigation of 523 trauma centers. Notably, trauma centers situated in the Western region tended to have higher charges compared to centers located in the Northeast exhibiting the lowest charges.1
Facing scrutiny and seeking transparency
State and federal authorities have taken notice of the issue, leading to increased scrutiny of trauma center activation fees. Some states have already mandated that hospitals disclose the amounts they charge for trauma activation fees, promoting transparency and accountability in billing practices.
A tiered approach for targeted response
To address problematic billing and ensure appropriate care, many Level I and II trauma centers have adopted a tiered approach to assign trauma care services. This allows for a targeted response based on the severity of the patient’s injuries:
- Tier 1: The highest level for severely injured patients, requiring full team activation.
- Tier 2: A less urgent activation involving a partial team response with additional services on standby.
- Tier 3: The lowest activation level involves a trauma evaluation that may or may not require a surgeon’s attendance.
Proper billing and continuous evaluation
Ethical billing practices involve determining the actual cost of trauma team readiness and ensuring that charges adequately offset these expenses. Additionally, hospitals should continuously evaluate patient care to avoid over- or under-triage, providing patients with the right level of care at the right time and cost.
Promoting ethical billing and eliminating socioeconomic barriers
Trauma care is critical for every patient’s survival, regardless of their socioeconomic status. By demonstrating a commitment to equitable and ethical billing practices, hospitals can eliminate socioeconomic barriers and ensure that trauma care is accessible to all. Transparent communication about charges and proper training of staff regarding the significance of ethical billing will further enhance patient satisfaction and resource utilization.
Properly defining charges for specialized trauma care and embracing ethical billing practices are essential for trauma centers. By implementing a tiered approach, evaluating care continuously, and promoting transparency in billing, healthcare providers can ensure that patients receive high-quality care without facing unjustifiable financial burdens. Ethical billing not only benefits patients but also fosters trust and credibility for hospitals as they fulfill their critical role in saving lives and promoting long-term patient recovery.
Footnotes:1 Zitek T, Paganok, Mechanic OJ, Farcy DA. Assessment of Trauma Team Activation Fees by US Region and Hospital Ownership. Jama Netw Open. 2023; 6(1) :e2252520. Doi: 10.1001/jamanetworkopen202252520