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Research Brief
Emergency Room

Policymakers and insurers have largely focused on the cost of emergency care relative to treatment in other outpatient settings. But the role of emergency departments in either facilitating or preventing hospital admissions may be a bigger story. How do modern emergency departments contribute to today's health care system, and how might this role change in the future?

AP IMAGES/M. Spencer Green

Emergency departments (EDs) are often mischaracterized as "the most expensive care there is." But depicting emergency care as expensive relative to treatment in a doctor's office ignores the many roles that emergency departments play, including advanced diagnostic center for ill patients referred by primary care physicians; decisionmaker for half of all hospital inpatient admissions; and the "safety net of the safety net" for millions of Americans who are unable to get care elsewhere. EDs are the only place in the U.S. health care system where the poor cannot be turned away.

Emergence of the Modern Hospital Emergency Department

Once little more than a treatment room on the ground floor of community hospitals, hospital emergency departments and the specialist physicians and nurses that staff them now routinely manage a wide range of challenges: caring for critically ill and injured children and adults; treating chronically ill patients with HIV–AIDS, cancer, renal failure, and diabetes; and evaluating complex patients with worrisome symptoms. The enhanced capabilities ED staff have acquired to provide this kind of care mean they can better diagnose, stabilize, and address difficult problems, often without resorting to hospital admission.

While these technical advances are remarkable, EDs have also become the victims of their own success. For much of the past quarter century, demand for emergency care has outpaced supply, in part because the rate of ED use has been growing twice as fast as the U.S. population. One of the biggest drivers of ED use is declining access to primary care. When a patient has troubling symptoms and no alternative care options, the ED may be their only choice.

The average cost of an ED visit is about $900.
The average cost of a hospital stay is ten times that amount.

Rising use of EDs, particularly by patients who do not have reliable access to primary care, has led insurers and policymakers to focus on the high cost of "nonurgent" ED visits. This has distracted attention from more important and consequential trends, including the growing use of EDs as diagnostic centers, the increasingly prominent role EDs play as the major entry point for unscheduled hospital admissions, and the potential role EDs may be playing in limiting growth of preventable hospital admissions. These trends were recently examined by a team of RAND Health researchers, drawing on published federal data and interviews with primary care physicians, hospitalists, and emergency department physicians.

The Evolving Role of EDs

EDs account for nearly all of the recent growth in hospital admissions. Primary care physicians appear to be sending more of their ill patients to the ED, rather than admitting them to the hospital themselves. Office-based physicians cite severity of illness and complexity of symptoms as the main reasons they refer patients to the ED.

Increasingly, EDs are supporting primary care practices by performing complex diagnostic workups and handling after-hours demand for care. Almost all of the physicians RAND interviewed — specialists and primary care alike — confirmed that office-based primary care physicians are growing increasingly reliant on EDs to perform expedited workups of complex patients with potentially dangerous symptoms.


As a result of these shifts in practice, emergency department physicians have become the major decisionmakers for approximately half of all U.S. hospital admissions. Since inpatient care accounts for more than 30 percent of aggregate U.S. health care spending — nearly a trillion dollars per year — decisions made in hospital EDs have a profound impact on the health of patients, the financial well-being of hospitals, and aggregate health care spending.

Although hospital EDs and the doctors who staff them represent a small part of the U.S. health care system, they have a disproportionate impact on patient care. In any given year, one out of five Americans makes at least one visit to an ED. ED physicians account for only about 4 percent of U.S. physicians, but they manage more than 10 percent of all outpatient hospital visits and more than one-quarter of visits for new or changing symptoms, focusing disproportionately on those involving potentially dangerous or troubling symptoms, such as chest or abdominal pain, severe headache, or shortness of breath.

Most patients who seek ED treatment on a walk-in basis do so because they lacked an alternative or were sent to the ED by a health care provider. Despite efforts to strengthen primary care, the major reason patients visit EDs for health problems treatable or preventable by primary care is lack of timely options elsewhere. Many primary care practices do not offer after-hours or weekend care, and the physicians who manage these practices may be hard to reach by phone. In a national survey, 4 of 5 patients who contacted a health care provider before heading to the ED were advised to seek care there.

Although hospital admissions from EDs are increasing overall, EDs appear to be playing a constructive role in limiting preventable hospital admissions. Before the advent of ED-based observation units, individuals were routinely admitted to the hospital for 2 or 3 days to rule out a possible heart attack (for example). Today, the same individuals can be comprehensively evaluated in an observation unit within 6–24 hours and never see a hospital bed. Similar strategies are being developed for other time-sensitive conditions. The average cost of an ED visit is about $900. The average cost of a hospital stay is ten times that amount.

Operating at the Interface of Inpatient and Outpatient Care

The fact that EDs play multiple, valuable roles in our health care system has been obscured by the recent focus on ED use for nonurgent conditions. EDs can play these roles because they function at the interface between outpatient and inpatient care, have access to advanced diagnostic and treatment technology that is rarely available in doctors' offices, are staffed by physicians and nurses trained to manage a wide range of problems, are open 24 hours a day, and have a unique legal duty to care for all in need. As American health care inexorably transitions from fee-for-service reimbursement to payment models intended to reward high-value rather than high-volume health care, EDs are likely to become an even more important component of integrated health care delivery systems.

This report is part of the RAND research brief series. RAND research briefs present policy-oriented summaries of individual published, peer-reviewed documents or of a body of published work.

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