Insurance covered most of the cost of the hospital stay, he said. He didn’t pay much attention to a bill he received from Commonwealth Anesthesia Associates and expected his insurance to cover it. A few months ago, he got a notice that Commonwealth was suing him in Richmond General District Court for $1,870 for putting him under during the surgery, court records show.

“Wow, seriously?” the 30-year-old information technology manager recalled thinking after getting the court summons. Loney didn’t have that kind of money at hand. His plan was to try to negotiate down the amount or “take out another credit card to pay for it.”

Loney’s is a classic, notorious type of surprise bill that Congress and activists have worked for years to eliminate: an out-of-network charge not covered by insurance even though the patient had an emergency procedure or sought care at an in-network hospital thinking insurance would cover most charges.

Commonwealth said it was in-network for Loney’s insurer, UnitedHealthcare. But the insurer rejected the anesthesiology charge because it said his primary care doctor was out of network, claims records show.

The federal No Surprises Act, passed at the end of 2020, has been hailed by consumer advocates for prohibiting such practices. Starting Jan. 1, medical companies in most cases cannot bill patients more than in-network amounts for any emergency treatment or out-of-network care delivered at an in-network hospital.

But as much as the legislation is designed to protect millions of patients from unexpected financial consequences, it will hardly spare all consumers from medical billing surprises.

“It’s great that there will be surprise billing protections 鈥� but you’re still going to see lawsuits,” said Zack Cooper, an economist and associate professor at the Yale School of Public Health. “This is by no means going to get rid of all of the problems with billing.”

The law will kick in too late for Loney and many others saddled with surprise out-of-network bills in states that don’t already ban the practice.

“It doesn’t prohibit surprise bills that are happening now in states that don’t have protections” against them, said Erin Fuse Brown, a law professor at Georgia State University who studies hospital billing. “And it doesn’t prohibit collection activity for surprise bills that arose prior to January.”

Virginia’s surprise-bill protection law took effect only this year and doesn’t apply to self-insured employer health plans, which cover a large portion of residents.

The federal legislation also does nothing to reduce another kind of unpleasant, often surprising bill 鈥� large, out-of-pocket payments for in-network medical care that many Americans can’t afford and might not have realized they were incurring.

Two substantial changes in recent years shifted more risk to patients. Employers and other payers narrowed their provider networks to exclude certain high-cost hospitals and doctors, making them out of network for more patients. They also drastically increased deductibles 鈥� the amount patients must pay each year before insurance starts contributing.

The No Surprises Act addresses the first change. It does nothing to address the second.

For a snapshot of the past and future of surprise and disputed medical bills, KHN examined Commonwealth’s lawsuits against patients in central Virginia and attended court hearings where patients contested their bills.

“The whole thing with insurance not covering my bills is a headache,” said Melissa Perez-Obregon, a Richmond-area dance teacher whom Commonwealth sued for $1,287 over services she received during the 2019 birth of her daughter, according to court records. Her insurance paid most but not all of a $5,950 anesthesia charge, billing records show.

“I’m a teacher,” she said, standing in the lobby at Chesterfield County General District Court. “I don’t have this kind of extra money.”

Commonwealth is one of the more active creditors seeking judgments in the Richmond area, court records show. From 2019 through 2021, it filed nearly 1,500 cases against patients claiming money owed for treatment, according to the KHN analysis of court filings.

In numerous cases, it initiated garnishment proceedings, in which creditors seize a portion of patients’ wages.

as “the largest private anesthesiology practice in Central Virginia,” Commonwealth said it employs more than 100 clinicians who care for roughly 55,000 patients a year in hospitals and surgery centers, mostly in the Richmond area.

Commonwealth said more than 99% of the patients it treats are members of insurance plans it accepts. It garnishes wages only as a “last resort” and only if the patient has the ability to pay, Michael Williams, Commonwealth’s practice administrator, said in a written statement.

“Over the past three years we have filed suit to collect from just over 1% of our patients,” mostly for money owed for in-network deductibles or coinsurance, Williams said. Nearly half the bills are settled before the court date, he said.

Gwendolyn Peters, 67, said she was shocked to receive a court summons this summer. Commonwealth was suing her for $1,000 for anesthesia during a lumpectomy for breast cancer in 2019, according to court records.

“This is the first time I have ever been in this situation,” she said, sitting in the Chesterfield court with half a dozen other Commonwealth defendants.

Because patients typically have little or no control over who puts them under, Brown said, anesthesiologists face less risk to their businesses and reputations than other medical specialists do in using aggressive collections tactics.

The specialty is often “one of the worst offenders because they don’t depend on their reputation to get patients,” she said. “They’re not going to lose business because they engage in these really aggressive practices that ruin their patients’ finances.”

The average annual deductible for single-person coverage from job-based insurance has soared from in the past 15 years, according to 麻豆女优. Deductibles for family coverage in many cases Coinsurance 鈥� the patient’s responsibility after the deductible is met 鈥� can add thousands of additional dollars in expenses.

That means millions of patients are essentially uninsured for care that might cost them a substantial portion of their income. Surveys have repeatedly found that many consumers say they would have an unexpected bill of even a few hundred dollars.

Loney’s insurer, UnitedHealthcare, agreed to pay the bill from Commonwealth for his emergency appendectomy after being contacted by KHN and saying it “updated” information on the claim. Otherwise, Loney said, he couldn’t have paid it without borrowing money.

In Richmond-area courthouses, hearings for Commonwealth lawsuits take place every few months. A lawyer for the anesthesiology practice attends, sometimes making payment arrangements with patients. Many defendants don’t show up, which often means they lose the case and might be subject to garnishment.

Commonwealth sued retiree Ronda Grimes, 66, for $1,442 for anesthesia claims her insurance didn’t cover after a 2019 surgery, billing and legal records filed in Richmond General District Court show.

“That’s a lot of money, especially when you have health insurance,” she said.

New examining court cases in Wisconsin shows that medical lawsuits are disproportionately filed against people of color and people living in low-income communities.

“Physicians are entitled to get paid like everyone else for their services,” Cooper said. But unaffordable, out-of-pocket medical costs are “a systemic issue. And this systemic issue generally falls on the backs of the most vulnerable in our population.”

For uninsured patients, Commonwealth matches any financial assistance given by the hospital and will be “enhancing” its financial assistance program in 2022, Williams said.

Two of the nine people being sued by Commonwealth and interviewed by KHN at courthouse hearings were Hispanic. Four were Black.

One was Darnetta Jefferson, 61, who underwent a double mastectomy in early 2020 and came to court wearing a cancer-survivor shirt. Commonwealth sued her for $836 it said she owed in coinsurance for anesthesia she was given during the surgery. Commonwealth’s lawyer agreed to drop the lawsuit if she agreed to pay $25 a month toward the balance until it’s paid, she said.

“If I ever have some extra money to pay it off someday, I will,” said Jefferson, who worked at Ukrop’s supermarket for many years before her cancer forced her to go on disability. “But right now, my circumstances are not looking good.”

Although she is living on a reduced income, her rent just went up again, said Jefferson, who also survived lung cancer diagnosed in 2009. Rent now runs close to $1,000 a month.

Paying Commonwealth’s bill in monthly $25 increments, she said, means “it’s going to be a long way to go.”

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The child failed the screening required by law for all newborns, the tester said, requiring a follow-up exam. “We were scared as first-time parents,” said Malik, who agreed to the second exam. The clinician, Malik said, didn’t tell them that infants often fail an initial screening because of in the ears that soon dissipates. The second screening found no problem with the baby’s hearing.

Last year, when her second daughter was born, Malik refused a hearing test after another Pediatrix clinician appeared at her bedside. (Parents are allowed to opt out but rarely do.)

The infant hearing test 鈥� particularly the more advanced technology Pediatrix uses 鈥� is an example of how some common medical procedures have become significantly more profitable for their providers.

Pediatrix and related companies have drawn a string of complaints from dissatisfied customers like Malik, who said she was surprised by Pediatrix’s charges for in-hospital infant care. Such tests were once free or included in a hospital’s new-baby fees. Pediatrix earns tens of millions of dollars a year in revenue from them, according to regulatory filings.

Founded in Florida decades ago, Pediatrix and its parent company, Mednax, have grown into a network of physicians and other clinicians delivering hearing screens, pediatric intensive care, pediatric surgery and obstetric services. They operate in more than 400 affiliated hospitals in some 40 states.

Pediatrix now cares for about 1 in 4 babies in neonatal intensive care units, according to the company, and administers its hearing tests to nearly a million babies a year.

“I’ve been involved with trying to prevent them coming into hospitals,” said Lisa Hunter, a professor and pediatric hearing specialist at the University of Cincinnati who objected generally to Pediatrix’s high charges for hearing screens and the billing confusion they can cause. “I’m very much empathetic with patients who have concerns.”

Pediatrix officials say their doctors and other clinicians deliver top-level maternity and newborn medicine, often to smaller and community hospitals as well as large systems, providing not just hearing tests but surgery and lifesaving care for premature babies.

“Doing what’s right for the patient is our highest priority,” said Dr. Roger Hinson, president of the Pediatrix and Obstetrix medical group.

Dr. Michelle Barhaghi, an obstetrician herself, said she was shocked by the $6,538 that a Pediatrix doctor in California charged for the unplanned cesarean delivery of her baby in April while she was traveling.

“When I saw that, my jaw dropped,” she said. “I sent that bill statement to all my OB-GYN friends.”

Insurance paid Pediatrix $2,867, according to benefit statements. That’s still nearly three times the rate for the same procedure under Medicare’s schedule of physician fees. Pediatrix also billed Barhaghi $1,311 for charges that insurance didn’t cover for a physical and discharge prep for her baby. Pediatrix withdrew that bill after being contacted by KHN for comment, she said.

Three years ago, the insurance giant Aetna sued Mednax and Pediatrix, saying they inflated charges by more than $50 million, performing unneeded tests and treatments and diagnosing babies as being sicker than they really were.

Mednax denied Aetna’s allegations, and the case ended in July when Aetna withdrew it as part of a confidential agreement. Neither Aetna nor Mednax would disclose the terms.

As part of the proceedings, Mednax admitted in court that it destroyed internal emails Aetna had sought as potential evidence of corporate coaching to nudge physicians to engage in “upcoding” to higher-value procedures.

Pediatrix was a of a campaign in the early 2000s for state laws requiring hearing tests for babies, records show. now have such laws, and the American Academy of Pediatrics for all newborns before they leave the hospital.

The idea is that the rare baby with hearing deficiencies 鈥� two or three in every thousand 鈥� needs to be identified quickly to ensure proper treatment and language development even if some false positives worry parents.

A simple screen measures whether the baby’s inner ear responds to sound. A more expensive hearing screen, a procedure originally designed to assess patients with serious neurological or auditory disease, measures the brain’s electrical response to sound.

Many hospitals reserve that screen for high-risk babies in intensive care or for those who fail an earlier, less expensive screening.

Aetna’s claims analysis found that Mednax and affiliates billed three times more often for those kinds of tests than for those given by non-Mednax clinicians.

Pediatrix charges $150 or more for the test, said audiologists familiar with the company. The company charged $326 for Malik’s first child’s screening, billing records show, and insurance paid a discounted price of $177.

“The cost of doing the screening should be no more than $50,” said professor Hunter, including the initial test and in-hospital follow-up. “To bill more than that, and to do this on every single baby that’s born, to me that sounds like a license to print money.”

Hinson said Pediatrix uses the more expensive auditory brainstem screen because it tests the entire hearing pathway. He said it has a lower false-positive rate on infant screenings than the less expensive alternative.

The Joint Committee on Infant Hearing, a board of experts considered authoritative for screening protocols, says initially for babies.

But done in the hospital soon after birth, both varieties produce a substantial number of initial false indications of hearing deficiency, , often because of fluid in the ears from birthing.

This requires a second test either in the hospital or sometimes weeks later in a doctor’s office. Meanwhile, families might believe their baby could be deaf. When parents are approached by an infant-hearing screener in the hospital, they should make sure the procedure is covered by insurance, patient advocates say. If the child fails the test, parents should be aware it could be a fleeting result and request a follow-up before leaving the hospital.

or mishandled bills from Pediatrix and Mednax have drawn complaints to the Better Business Bureau and on .

When a Mednax or Pediatrix clinician is outside a patient’s insurance network, “we bill the balance to the patient,” the company says in filings with the Securities and Exchange Commission. At least one hospital, Inova Alexandria Hospital in Northern Virginia, has warned expectant parents that Pediatrix “may not be an approved provider” with their insurer.

From the beginning of 2019 to mid-November, 192 people filed complaints with the Better Business Bureau against Pediatrix and Mednax, according to data provided by the BBB. Most of the complaints are about billing and collections issues, according to the data.

“We have to do things that make things more seamless for our patients and more seamless for our payers,” Hinson said. When Pediatrix is out of network, the company works with families “to mitigate post-discharge surprise billing,” he said.

It took more than a year, two dozen phone calls and the help of the Better Business Bureau to resolve one incorrect $1,010 bill. It was charged for a Pediatrix nurse practitioner who stood by while Sarah Tela’s twins were delivered by an obstetrician in 2018.

After doing research, Tela, who lives near Seattle, realized that “I wasn’t the only one going through this battle with them.” She added: “I could have easily paid the bill. But I knew I was right.”

The problem turned out to be an incorrect date of service on the bill, which caused the insurer’s claims software to reject it, she said.

Mednax, which contacted Barhaghi and Malik after their cases were brought up by a reporter, is “confident that their respective matters are being resolved to their satisfaction,” the company said in an email.

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The bill was extraordinary. Sutter Health Memorial Medical Center charged $44,914 including an $8,928 “trauma alert” fee, billed for summoning the hospital’s top surgical specialists and usually associated with the most severely injured patients.

The case, buried in the records of a 2017 trial, is a rare example of a courtroom challenge to something billing consultants say is increasingly common at U.S. hospitals.

Tens of thousands of times a year, hospitals charge enormously expensive trauma alert fees for injuries so minor the patient is never admitted.

In Florida alone, where the number of trauma centers has exploded, hospitals charged such fees more than 13,000 times in 2019 even though the patient went home the same day, according to a KHN analysis of state data provided by Etienne Pracht, an economist at the University of South Florida. Those cases accounted for more than a quarter of all the state’s trauma team activations that year and were more than double the number of similar cases in 2014, according to an all-payer database of hospital claims kept by Florida’s Agency for Health Care Administration.

While false alarms are to be expected, such frequent charges for little if any treatment suggest some hospitals see the alerts as much as a money spigot as a clinical emergency tool, claims consultants say.

“Some hospitals are using it as a revenue generator,” Tami Rockholt, a registered nurse and medical claims consultant who appeared as an expert witness in the Sutter Health car-accident trial, said in an interview. “It’s being taken advantage of” and such cases are “way more numerous” than a few years ago, she said.

Hospitals can charge trauma activation fees when a crack squad of doctors and nurses assembles after an ambulance crew says it’s approaching with a patient who needs trauma care. The idea is that life-threatening injuries need immediate attention and that designated trauma centers should be able to recoup the cost of having a team ready 鈥� even if it never swings into action.

Those fees, which can exceed $50,000 per patient, are billed on top of what hospitals charge for emergency medical care.

“We do see quite a bit of non-appropriate trauma charges 鈥� more than you’d see five years ago,” said Pat Palmer, co-founder of Beacon Healthcare Costs Illuminated, which analyzes thousands of bills for insurers and patients. Recently “we saw a trauma activation fee where the patient walked into the ER” and walked out soon afterward, she said.

The portion of Florida trauma activation cases without an admission rose from 22% in 2012 to 27% last year, according to the data. At one Florida facility, Broward Health Medical Center, there were 1,285 trauma activation cases in 2019 with no admission 鈥� almost equal to the number that led to admissions.

“Trauma alerts are activated by EMS [first responders with emergency medical services], not hospitals, and we respond accordingly when EMS activates a trauma alert from the field,” said Jennifer Smith, a Broward Health spokesperson.

Florida regulations allow hospitals themselves to declare an “in-hospital trauma alert” for “patients not identified as a trauma alert” in the field, according to by the Florida Department of Health.

At some hospitals, few patients whose cases generate trauma alerts are treated and released the same day.

At Regions Hospital, a Level I trauma center in St. Paul, Minnesota, patients who are not admitted after a trauma team alert are “very rare” 鈥� 42 of 828 cases last year, or about 5%, said Dr. Michael McGonigal, the center’s director, who blogs at “.”

“If you’re charging an activation fee for all these people who go home, ultimately that’s going to be a red flag” for Medicare and insurers, he said.

In the Sutter case in Modesto, the patient sued a driver who struck his vehicle, seeking damages from the driver and her insurer. Patient “looks good,” an emergency doctor wrote in the records, which were part of the trial evidence. He prescribed Tylenol with hydrocodone for pain.

“If someone is not going to bleed out, or their heart is not going to stop, or they’re not going to quit breathing in the next 30 minutes, they probably do not need a trauma team,” Rockholt said in her testimony.

Like other California hospitals with trauma center designations, Sutter Health Memorial Medical Center follows “county-designated criteria” for calling an activation, said Sutter spokesperson Liz Madison: “The goal is to remain in position to address trauma cases at all times 鈥� even in the events where a patient is determined healthy enough to be treated and released on the same day.”

Trauma centers regularly review and revise their rules for trauma team activation, said Dr. Martin Schreiber, trauma chief at Oregon Health & Science University and board chair at the Trauma Center Association of America, an industry group.

“It is not my impression that trauma centers are using activations to make money,” he said. “Activating patients unnecessarily is not considered acceptable in the trauma community.”

Hospitals began billing trauma team fees to insurers of all kinds after Medicare authorized them for cases in which hospitals are notified of severe injuries before a patient arrives. Instead of leaving trauma team alerts to the paramedics, hospitals often call trauma activations themselves based on information from the field, trauma surgeons say.

Reimbursement for trauma activations is complicated. Insurers don’t always pay a hospital’s trauma fee. Under rules established by Medicare and a committee of insurers and health care providers, emergency departments must give 30 minutes of critical care after a trauma alert to be paid for activating the team. For inpatients, the trauma team fee is sometimes folded into other charges, billing consultants say.

But, on the whole, the increase in the size and frequency of trauma team activation fees, including those for non-admitted patients, has helped turn trauma operations, often formerly a financial drain, into profit centers. In recent years, hundreds of hospitals have sought trauma center designation, which is necessary to bill a trauma activation fee.

“There must have been a consultant that ran around the country and said, 鈥楬ey hospitals, why don’t you start charging this, because you can,’” said Marc Chapman, founder of , which challenges large hospital bills for auto insurers and other payers. “In many of those cases, the patients are never admitted.”

The national number of Level I and Level II trauma centers, able to treat the most badly hurt patients, grew from 305 in 2008 to 567 last year, according to the American College of Surgeons. Hundreds of other hospitals have Level III or Level IV trauma centers, which can treat less severe injuries and also bill for trauma team activation, although often at lower rates.

Emergency surgeons say they walk a narrow path between being too cautious and activating a team unnecessarily (known as “overtriage”) and endangering patients by failing to call a team when severe injuries are not obvious.

Often “we don’t know if patients are seriously injured in the field,” said Dr. Craig Newgard, a professor of emergency medicine at Oregon Health & Science University. “The EMS providers are using the best information they have.”

Too many badly hurt patients still don’t get the care they need from trauma centers and teams, Newgard argues.

“We’re trying to do the greatest good for the greatest number of people from a system perspective, recognizing that it’s basically impossible to get triage right every time,” he said. “You’re going to take some patients to major trauma centers who don’t really end up having serious injury. And it’s going to be a bit more expensive. But the trade-off is optimizing survival.”

At Oregon Health & Science, 24% of patients treated under trauma alerts over 12 months ending this spring were not admitted, Schreiber said.

“If this number gets much lower, you could put patients who need activation at risk if they are not activated,” he said.

On the other hand, rising numbers of trauma centers and fees boost health care costs. The charges are passed on through higher insurance premiums and expenses paid not just by health insurers but also auto insurers, who often are first in line to pay for the care of a crash victim.

Audits are uncommon and often the system is geared to paying claims with little or no scrutiny, billing specialists say. Legal challenges like the one in the Sutter case are extremely rare.

“Most of these insurers, especially auto insurance, do not look at the bill,” said Beth Morgan, CEO of Medical Bill Detectives, a consulting firm that helps insurers challenge hospital charges. “They automatically pay it.”

And trauma activation charges also can hit patients directly.

“Sometimes the insurance companies will not pay for them. So people could get stuck with that bill,” Morgan said.

A few years ago, Zuckerberg San Francisco General Hospital charged a $15,666 trauma response fee to the family of a toddler who had fallen off a hotel bed. He was fine. Treatment was a bottle of formula and a nap. The hospital waived the fee after KHN and Vox wrote about it.

Trauma alert fatigue can add up to a nonfinancial cost for the trauma team itself, McGonigal said.

“Every time that pager goes off, you’re peeling a lot of people away from their jobs only to see [patients] go home an hour or two later,” he said.

“Some trauma centers are running into problems because they run themselves ragged. And there is probably unneeded expense in all the resources that are needed to evaluate and manage those patients.”

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But Knight’s wound, while requiring about 30 stitches, wasn’t life-threatening. Hospital records called it “mild.” The people in white coats quickly scattered, he remembered, and he went home about three hours later.

“Basically, it was just a gash on my arm,” said Knight, 71. “The emergency team that they assembled didn’t really do anything.”

Nevertheless, Chippenham, owned by for-profit chain HCA Healthcare, included a $17,000 trauma team “activation” fee on Knight’s bill, which totaled $52,238 and included three CT scans billed at $14,000. His care should have cost closer to $3,500 total, according to claims consultant WellRithms, which analyzed the charges for KHN.

HCA Healthcare’s activation fees run as high as $50,000 per patient and are sometimes 10 times greater than those at other hospitals, according to publicly posted price lists. Such charges have made trauma centers, once operated mainly by established teaching hospitals, a key part of the company’s growth and profit-generating strategy, corporate officials have said. HCA’s stock has doubled in three years. The biggest U.S. hospital operator along with the Department of Veterans Affairs, HCA has opened trauma centers in more than half its 179 hospitals and in the country.

And it’s not slowing down.

HCA “has basically taken a position that all of their hospitals should be trauma centers,” said Dr. Robert Winchell, describing conversations he had with HCA officials. Winchell is a trauma surgeon and former chairman of the at the American College of Surgeons.

Trauma patients are typically those severely injured in automobile accidents or falls or wounded by knives or guns.

State or local regulators confer the designation “trauma center,” often in concert with standards verified by the American College of Surgeons. The status allows a cascade of lucrative reimbursement, including activation fees billed on top of regular charges for medical care. Trauma centers are mostly exempt from enacted to limit excessive hospital spending and expansion. The bills for all this 鈥� reaching into tens of thousands of dollars 鈥� go to private insurers, Medicare or Medicaid, or patients themselves.

“Once a hospital has a trauma designation, it can charge thousands of dollars in activation fees for the same care seen in the same emergency room,” said Stacie Sasso, executive director of the Health Services Coalition, made up of unions and employers fighting trauma center expansion by HCA and others in Nevada.

HCA’s expansion into trauma centers alarms health policy analysts who suggest its motive is more about chasing profit than improving patient care. Data collected by the state of Florida, analyzed by KHN, shows that regional trauma cases and expensive trauma bills rise sharply after HCA opens such centers, suggesting that many patients classified as trauma victims would have previously been treated less expensively in a regular emergency room.

Patients admitted to HCA and other for-profit hospitals in Florida with a trauma-team activation were far more likely to be only mildly or moderately injured than those at not-for-profit hospitals, .

HCA is “cherry-picking patients,” said , CEO of the University of Florida Health Shands, which runs a Level I trauma center, the highest designation. “What you find is an elderly person who fell and broke their hip who could be perfectly well treated at their local hospital now becomes a trauma patient.”

HCA’s trauma center expansion makes superior care available to more patients, providing “lifesaving clinical services while treating all critically injured patients,” said company spokesperson Harlow Sumerford.

Richmond’s population “is booming,” said Chippenham spokesperson Jeffrey Caldwell. “This increase in demand requires that the regional health care system keep up.”

Trauma Is Big Business

HCA’s trauma center boom picked up speed in Florida a decade ago and has spread to its hospitals in Virginia, Nevada, Texas and other states. It has sparked fierce fights over who handles highly profitable trauma cases and debates over when rival centers go head-to-head competing for patients.

“There’s no question it’s a money grab” by HCA, said Jimenez, who was part of a largely unsuccessful effort to stop HCA’s trauma center expansion in Florida. “It was clear that their trauma activation fees were five or six times larger than ours.”

In a process shielded from public view in Virginia, Chippenham recently applied for and won the highest trauma center designation, Level I, providing the most sophisticated care 鈥� and putting it squarely in competition with nearby VCU Health. VCU has run the region’s only Level I facility for decades. In October, Chippenham announced a contract for its own helicopter ambulance, which gives it another way to increase its trauma business, by flying patients in from miles away. The Virginia Department of Health rejected KHN’s request to review HCA’s Chippenham trauma center application and related documents.

“This is a corporate strategy” by HCA “to grow revenue, maximize reimbursement and meet the interest of stockholders,” said Dr. Arthur Kellermann, CEO of VCU Health, who says his nonprofit, state-run facility is sufficient for the region’s trauma care needs. “Many people in the state should be concerned that the end result will be a dilution of care, higher costs and poorer outcomes.”

Chippenham’s Caldwell said the “redundancy” with VCU “allows the region to be better prepared for mass trauma events.”

Studies show trauma centers need high volumes of complex cases to stay sharp. Researchers call it the “practice makes perfect” effect. Patients treated for traumatic brain injuries at hospitals seeing fewer than six such cases a year died at substantially higher rates than such patients in more experienced hospitals,

Another study, , showed that a decrease as small as 1% in trauma center volume 鈥� because of competition or other reasons 鈥� substantially increased the risk that patients would die.

By splitting a limited number of cases, a competing, cross-town trauma center could set the stage for subpar results at both hospitals, goes the argument. The number of VCU’s admitted adult trauma patients decreased from nearly 3,600 in 2014, before Chippenham attained Level II status, to 3,200 in 2019, VCU officials said.

Chippenham was the only Level I center in Virginia that declined to disclose its trauma patient volume to KHN.

“People are trying to push the [trauma center] designation process beyond what may be good for the major hospitals that are already providing trauma care,” said Dr. David Hoyt, executive director of the American College of Surgeons, speaking generally. Local authorities who make those decisions, he said, can be “pressured by a hospital system that has a lot of economic pull in a community.”

Unlike regular emergency departments, Level I and Level II trauma surgeons, neurosurgeons and special equipment available round-the-clock. Centers with Levels III or IV designations offer fewer services but are still more capable than many emergency rooms, with round-the-clock lab services and extra training, for example.

Hospitals defend trauma team activation fees as necessary to cover the overhead of having a team of elite emergency specialists at the ready. At HCA hospitals they can run more than $40,000 per case, according to publicly posted charge lists, although the amount paid by insurers and patients is often less, depending on the coverage.

“Fees associated with trauma activation are based on our costs to immediately deploy lifesaving resources and measures 24/7,” said HCA spokesperson Sumerford, adding that low-income and uninsured patients often pay nothing for trauma care. “What patients actually pay for their hospital care has more to do with their insurance plan” than the total charges, he said.

There is no standard accounting for trauma-related costs incurred by hospitals. One method involves for members of the trauma team by the potential hours worked. Hospitals don’t reveal calculations, but the wide variation in fees suggests they are often set with an eye on revenue rather than true costs, say industry analysts.

Reasonable charges for Knight’s total bill would have been $3,537, not $52,238, according to the analysis by WellRithms, a claims consulting firm that examined his medical records and Chippenham’s costs filed with Medicare. Given his minor injury, the $17,000 trauma activation fee “is not necessary,” said Dr. Ira Weintraub, WellRithms’ chief medical officer.

Often insurers pay substantially less than billed charges, especially Medicare, Knight's insurer. He paid nothing out-of-pocket, and Chippenham collected a total of $1,138 for his care, HCA officials said after this article was initially published. But hospitals can maximize revenue by charging high trauma fees to all insurers, including those required to pay a percentage of charges, say medical billing consultants.

VCU Health charges up to $13,455 for trauma activation, according to its charge list.

Average HCA trauma activation charges are $26,000 in states where the company does business 鈥� three times higher than those of non-HCA hospitals, according to data from Hospital Pricing Specialists, a consulting firm that analyzed trauma charges in Medicare claims for KHN.

The findings are similar to those reported , early in HCA’s trauma center expansion. The Times found that Florida HCA trauma centers were charging patients and insurers tens of thousands of dollars more per case than other hospitals.

Treating trauma patients in the ER is only the beginning of the revenue stream. Intensive inpatient treatment and long patient recoveries add to the income.

“We have more Level I, Level II trauma centers today than we have ever had in the company history,” HCA’s then-CEO, Milton Johnson, told stock analysts in 2016. “That strategy in turn feeds surgical growth. That strategy in turn feeds neurosciences growth, it feeds rehab growth.” Trauma centers attract “a certain cadre of high-value patients,” Dr. Jonathan Perlin, HCA’s chief medical officer, told analysts at a 2017 conference.

Patients at HCA’s largely suburban hospitals are more likely than those at an average hospital to carry private insurance, which pays much more than Medicare and Medicaid. the company’s revenue in 2020 came from private insurers, regulatory filings show. Hospitals, in general, collect of their revenue from private insurers, according to the Department of Health and Human Services.

HCA’s trauma cases can fit the same profile. At Chippenham, in south Richmond, trauma cases are “90% blunt trauma,” according to the hospital's online job posting last year for a trauma medical director. Blunt-trauma patients are generally victims of car accidents and falls and tend to have good insurance, analysts say.

VCU and other urban hospitals, on the other hand, treat a higher share of patients with gun and knife injuries 鈥� penetrating trauma 鈥� who are more often uninsured or covered by Medicaid. About 75% of VCU’s trauma cases are classified as blunt trauma, hospital officials said.

The 90% figure is “not accurate today,” Caldwell said. “Chippenham’s current mix of trauma type is aligned with that of other trauma centers in the region, and we treat traumas ranging from motor vehicle accidents to gunshots, stabbings and other critical injuries regularly.”

鈥楾rauma Drama’ in Florida and Beyond

HCA’s growth strategy is part of a wider trend. From 2010 to 2020 the number of Level I and Level II trauma centers verified by the American College of Surgeons nationwide increased from 343 to 567.

Nowhere has HCA added trauma centers more aggressively or the fight over trauma center growth been more acrimonious than in Florida. The state’s experience over the past decade may offer a preview of what’s to come in Virginia and elsewhere.

In the thick of the controversy, 鈥� but only after the number of HCA trauma centers in the state had grown from one to 11 over more than a decade and helped spark an explosion in trauma cases, according to Florida Department of Health data.

News headlines called it “trauma drama.” Hospitals with existing centers repeatedly filed legal challenges to stop the expansion, with little effect. Florida’s governor at the time was Rick Scott, former chief executive of Columbia/HCA, a predecessor company to HCA.

After launching Level II centers across the state, HCA officials not to adopt recommending severely injured patients be treated at the highest level of trauma care in a region 鈥� Level I, if available.

HCA “kept on working, working, working, working for 10 years” to gain trauma center approvals over objections, said Mark Delegal, who helped broker the legislative settlement as a lobbyist for large safety-net hospitals. “Once they had what they wanted, they were happy to lock the door behind them.”

HCA hospitals “serve the health care needs of their communities and adjust or expand services as those needs evolve,” said Sumerford.

As HCA added trauma centers, trauma-activation billings and the number of trauma cases spiked, according to Florida Department of Health data analyzed by KHN. Statewide, inpatient trauma cases doubled to 35,102 in the decade leading up to 2020, even though the population rose by only 15%. HCA’s share of statewide trauma cases jumped from 4% to 24%, the data shows.

Charges for trauma activations, also known as trauma alerts, for HCA’s Florida hospitals averaged $26,890 for inpatients in 2019 while the same fees averaged $9,916 for non-HCA Florida hospitals, the data shows. Total average charges, including medical care, were $282,600 per case in 2019 for inpatient trauma cases at HCA hospitals, but $139,000 for non-HCA hospitals.

HCA's substantially higher charges didn't necessarily result from patients with especially severe injuries, public university research found.

Over three years ending in 2014, Florida patients with sprains, mild cuts and other non-life-threatening injuries were “significantly more likely” to be admitted under trauma alerts at HCA hospitals and other for-profit hospitals than at nonprofit hospitals, by University of South Florida economist Etienne Pracht and colleagues. HCA hospitals have admitted emergency department Medicare patients at substantially higher-than-average rates since 2011, suggesting that at other hospitals many would have been sent home, new by the Service Employees International Union found.

“What’s going on with HCA is the Wall Street model they’re following,” said Pracht, who provided KHN with additional Florida Department of Health data showing soaring trauma cases. “And Wall Street’s not happy unless you’re expanding. They’re driven by the motive to keep the stock price high.”

Lobbying and Campaign Dollars

In Virginia, health care organizations need to go through process to add something as basic as a $1 million MRI imaging machine.

But to open or upgrade a trauma center, all that’s needed is the approval of the health commissioner after a confidential qualification procedure. Chippenham did not seek or obtain Level I verification from the American College of Surgeons before getting Level I approval from the state. It is ACS-verified as a Level II center and, Caldwell said, is seeking Level I status with ACS.

Virginia requires an “extensive application” and “in-depth” site reviews by experts before a hospital gains status as a trauma center, Dr. M. Norman Oliver, the commissioner, said in an email. “Chippenham Hospital met the requirements” to become a Level I center, he said.

Nearly 80% of HCA’s Level I and Level II trauma centers have been verified by the American College of Surgeons “and the others currently are pursuing this verification,” said HCA spokesperson Sumerford.

As in other states, HCA invests heavily in Virginia in political influence. are registered with the state to advocate on HCA’s behalf. One lobbyist from December 2019 through February 2020 treating public officials to reception spreads and meals at posh Richmond restaurants such as L'Opossum and Morton’s the Steakhouse, lobbying records submitted to Virginia’s Conflict of Interest and Ethics Advisory Council show. HCA’s political action committee to state candidates last year, according to the records.

Like other hospital systems, HCA hires former paramedics for “EMS relations” or “EMS outreach” jobs. HCA’s EMS liaisons are expected to develop a “business plan, driving service line growth,” according to its employment ads.

Chippenham’s decision to start a helicopter ambulance operation last year to compete with others in transporting trauma patients surprised some public officials. HCA and its contractor had for the operation to be reimbursed by insurers when Richmond City Council members learned about it. Members “were not up to speed on this matter,” council member Kristen Larson told a May 2020 meeting of the Richmond Ambulance Authority, .

Chippenham’s air ambulance partner, private equity-owned Med-Trans, has been the subject of media reports of patients with in out-of-network bills. It’s not unusual for air ambulances to charge $30,000 or more for transporting a patient from a highway accident or just across town, according to news reports.

Last year, 85% of Med-Trans flights for Virginia patients with health insurance were in-network, said a company spokesperson. But Med-Trans is out of network for Virginia members of Aetna and UnitedHealthcare, two of the state’s biggest carriers, said spokespeople for those companies. Med-Trans is part of Anthem Blue Cross Blue Shield’s network, an Anthem spokesperson said.

HCA runs trauma centers “really well,” said Winchell, who runs the Level I trauma center at NewYork-Presbyterian Weill Cornell Medical Center.

But “there are clearly areas of oversupply” for trauma centers generally, he said.

Instead of letting a drive for profits dictate trauma center expansion, health authorities need “objective and transparent metrics” to guide the designation of trauma centers, Winchell in the Journal of the American College of Surgeons.

Free-market advocate “Adam Smith might have been a good economist,” he wrote, “but he would have been a very poor designer of trauma systems.”

KHN data editor Elizabeth Lucas contributed to this report.

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