The Evolving Role of Emergency Departments in the United States

By Kristy Gonzalez Morganti, Sebastian Bauhoff, Janice C. Blanchard, Mahshid Abir, Neema Iyer, Alexandria Smith, Joseph V. Vesely, Edward Okeke, Arthur L. Kellermann
RAND Health, May 20, 2013

To develop a more complete picture of how EDs (emergency departments) contribute to our modern health care system, the Emergency Medicine Action Fund asked RAND to conduct this mixed-methods study.

Key findings include the following:

• Between 2003 and 2009, inpatient admissions to U.S. hospitals grew at a slower rate than the population overall. However, nearly all of the growth in admissions was due to a 17 percent increase in unscheduled inpatient admissions from EDs. This growth in ED admissions more than offset a 10 percent decrease in admissions from doctors’ offices and other outpatient settings. This pattern suggests that office-based physicians are directing to EDs some of the patients they previously admitted to the hospital.

• In addition to serving as an increasingly important portal of hospital admissions, EDs support primary care practices by performing complex diagnostic workups and handling overflow, after-hours, and weekend demand for care. Almost all of the physicians we interviewed—specialist and primary care alike—confirmed that office-based physicians increasingly rely on EDs to evaluate complex patients with potentially serious problems, rather than managing these patient themselves.

• As a result of these shifts in practice, emergency physicians are increasingly serving as the major decisionmaker for approximately half of all hospital admissions in the United States. This role has important financial implications, not only because admissions generate the bulk of facility revenue for hospitals, but also because inpatient care accounts for 31 percent of national health care spending.

• Although the core role of EDs is to evaluate and stabilize seriously ill and injured patients, the vast majority of patients who seek care in an ED walk in the front door and leave the same way. Data from the Community Tracking Study indicate that most ambulatory patients do not use EDs for the sake of convenience. Rather, they seek care in EDs because they perceive no viable alternative exists, or because a health care provider sent them there.

• Medicare accounts for more inpatient admissions from EDs than any other payer. To gain insight into whether care coordination makes a difference in the likelihood of hospital admission from an ED, we compared ED admission rates among Medicare beneficiaries enrolled in a Medicare Choice plan versus beneficiaries enrolled in Medicare fee-for-service (FFS). We found no clear effect on inpatient admissions overall, or on a subset of admissions involving conditions that might be considered “judgment calls.”

• Irrespective of the impact of care coordination, EDs may be playing a constructive role in constraining the growth of inpatient admissions. Although the number of non-elective ED admissions has increased substantially over the past decade, inpatient admissions of ED patients with “potentially preventable admissions” (as defined by the Agency for Healthcare Research and Quality) are flat over this time interval.

Our study indicates that: (1) EDs have become an important source of admissions for American hospitals; (2) EDs are being used with increasing frequency to conduct complex diagnostic workups of patients with worrisome symptoms; (3) Despite recent efforts to strengthen primary care, the principal reason patients visit EDs for non-emergent outpatient care is lack of timely options elsewhere; and (4) EDs may be playing a constructive role in preventing some hospital admissions, particularly those involving patients with an ambulatory care sensitive condition. Policymakers, third party payers, and the public should be aware of the various ways EDs meet the health care needs of the communities they serve and support the efforts of ED providers to more effectively integrate ED operations into both inpatient and outpatient care.

This RAND Health report provides an excellent perspective on how emergency departments (EDs) have evolved into institutions providing a greater central role in health care delivery. It is a particularly valuable report because it sets aside many misperceptions about ED functions – misperceptions that can lead to flawed policy recommendations.

It is crucial that we continue to assess and recommend improvements in the health care delivery system. This report reflects the benefit of such an approach since EDs have expanded their roles in very beneficial ways. As they continue to evolve, integration with both inpatient and outpatient care should become more efficient, especially from the perspective of benefiting patients.

The current focus of policy reform seems to be not so much on the improvement of health care delivery, but rather on mechanisms that supposedly would slow the growth in health care spending. Accountable care organizations, bundling of payments, innovative insurance designs such as those that erect financial barriers to care, are the types of policy approaches that will have very little impact on overall costs while inappropriately expanding the administrative excesses of our dysfunctional system.

This report is well worth downloading. As you read it, you can see many opportunities to further expand the progress that we have seen through the evolving improvements in the role of EDs in our health care system. Thinking about how further improvement in integrating their role with both inpatient and various community outpatient services can help us envision further opportunities to achieve the goals of a high-performance system.

An example of the misguided and misdirected emphasis on innovative payment reform is the failure to find any clear effect on inpatient admissions when comparing the public Medicare program with the much more expensive private Medicare Advantage plans. Payment innovation is simply not where it’s at.

We need to get this right. Let’s continue to work on fixing the health care delivery system so that it works best for patients. That is the key to improving value in health care. It will work as long as we adopt a financing system that is designed exclusively to fund a high-performance health care system (single payer), as opposed to one that is designed to keep policy wonks and insurance administrators employed in bringing us ever-expanding payment innovations that we don’t want (Obamacare).