1. Freestanding Emergency
Medical Care Facilities
Texas Department of State Health Services 25 TAC §131
Richard Bays MBA, RN, CPHQ
© 2010

2. Free-Standing Emergency
Departments
ER’s On The Rise…
• Free-standing emergency departments (FSEDs) are on the rise. Unlike
urgent care clinics, these facilities are designed to replicate the full array
of services and procedures offered by traditional hospital emergency
departments. Most accept ambulance traffic. However, FSEDs cannot
admit patients for inpatient care. When such care is needed, the FSED
must transfer the patient to a hospital with which it has a written transfer
agreement.

3. Free-Standing Emergency
Departments
On The Rise…
• The development of FSEDs is driven by growing population trends in urban
and suburban communities, demand for more convenient care closer to
home, and a dwindling number of hospital emergency departments
despite the growing need for emergency care. From 1995 to 2005, the
number of emergency rooms (ERs) in the United States decreased from
4,176 to 3,795.
• The need for emergency room services is growing in the United States.
From 1995 to 2005, ER visits increased 31 percent.

4. Free-Standing Emergency
Departments
In Texas:
• FSEDs will currently be licensed in Texas as of September 1, 2010. The
Department of State Health Services (DSHS), which licenses and oversees
other types of health care facilities, will have authority to regulate them.
• In 2007, legislation was filed to define the minimum operating criteria for
FSEDs as well as to establish regulatory authority. TMA strongly supported
the legislation. The bill stalled because of differences over whether FSEDs
must be open 24 hours a day, seven days a week.
• All FSED’s must be licensed as of September 1, 2010.

5. Free-Standing Emergency
Departments
• A big "EMERGENCY" sign on a medical building has always stood for certain predictable
things, including round-the-clock medical treatment for anything that ails you—albeit on a
"most sick, first served" basis and long hours in crowded waiting rooms for people with
less than dire medical problems.
• At most of the nation's 4,500 or so hospital emergency rooms, the old ways still rule. But a
new type of emergency facility is emerging across the country, one that isn't located at a
hospital at all and whose claim to fame is customer service. Often situated in the fast-
growing suburbs, these "freestanding" emergency rooms trumpet shorter wait times and a
more pleasant environment and, at their best, bring much-needed emergency diagnostic
and clinical expertise to underserved areas.
• Catering to a mostly insured, affluent clientele, freestanding emergency rooms aim to
smooth away the rough edges of an ER visit while providing top-notch care.
Hospital ER's have new competition: freestanding
facilities that tout customer service

6. Free-Standing Emergency
Departments
More emergency rooms open away from hospitals
• A commuter suburb near Washington, D.C., boasts new homes, shopping
centers, plenty of traffic — and a state-of the-art 21-room emergency
department tucked into an office complex.
• Unlike most emergency departments, however, there are no patients
awaiting transfer upstairs to a medical ward, because there is no medical
ward. The nearest hospital is about 8 miles away.
• The number of such facilities owned by hospitals or entrepreneurial
doctors grew 23% from 2005 to 2006, jumping from 146 to 179, according
to an American Hospital Association survey. About a dozen more are
opening or in the planning stages in states such as Florida, Minnesota and
Texas.

7. Free-Standing Emergency
Departments
•The growth of stand-alone emergency departments comes amid continued
overcrowding in hospital ERs and stiff competition among hospitals to expand
their business in fast-growing suburbs.
•The free-standing centers, open around the clock, often offer shorter wait
times than hospital-based departments and can treat a variety of illnesses and
problems, such as fevers, broken bones and serious cuts
•Stand-alone ERs also can siphon patients with minor ailments away from
lower-cost urgent care centers or doctors' offices. Urgent care centers differ
from free-standing ERs because they usually are not open 24 hours and don't
have the same level of high-tech equipment.

8. Free-Standing Emergency
Departments
What customers want …
• Convenient locations – Primarily Suburban Areas
• Shorter wait times to see a physician – Hospitals are acuity based
(Visitors spend an average of 3.2 hours in hospital ER’s) *2003 Data*
• Availability – No office hour restrictions, Patients can access care before
or after work or commuting
• Boutique atmosphere opposed to sterile institution feel of hospitals
• Customer Service - Personalized service, not becoming a medical record
number
• Avoiding overcrowded urban emergency centers

9. Free-Standing Emergency
Departments
Catering to cash pay
and insured customers

10. Free-Standing Emergency
Departments
Show me the $$$...
• Insurance plans and Medicare generally pay for care in stand-alone
emergency departments, just as they do for hospital-based ERs. Yet, care
in an ER — whether free-standing or attached to a hospital — costs the
patient and the insurance company substantially more than at doctor's
offices or urgent care centers.
• For the same type of outpatient visit, for example, Medicare reimburses
medical providers $316 if a patient is treated in an emergency
department, compared with $138 in an urgent care center. Emergency
departments are open longer hours and generally have more staff, so
overhead costs are higher.

11. Free-Standing Emergency
Departments
Show me the $$$...
• Free-standing emergency departments also can draw the insured away from
hospitals, which rely on paying patients to make up for money they lose treating
the poor and uninsured
• X-rays, CT scans or other imaging tests are provided in about 43% of visits. Patients
receive medication over 77% of the time, with painkillers being the most frequently
prescribed drugs. *2003 Data*

12. Free-Standing Emergency
Departments
Sample Accounting Projections
Assets
Current Assets
Cash $5,400,000
Fixed Assets
Computers / Servers 50,000
Software-T System 50,000
Lab Equipment 130,000
Video-TV’s 20,000
---------------
Total Fixed Assets 250,000
Accumulated Depreciation (250,000)
---------------
Total Assets $5,400.000
=========
Liabilities & Equity
Current liabilities
Working Capital $292,500
Equipment loan 247,500
--------------
Total Current Liabilities 540,000
Equity
Net Income 4,860,000
---------------
Total Equity & liabilities $5,400,000
=========

13. Free-Standing Emergency
Departments
Developing the Model…
• Location(s)
• Facility – New construction / Build out
• State Licensure / Architectural Review
• Capital Equipment / Supplies
• Imaging / Lab / Pharmacy
• Staffing / Management
• Marketing / Referrals
• Revenue Cycle Management / Accreditation

14. Free-Standing Emergency
Departments
Footprint

15. Free-Standing Emergency
Departments
State Regulations
Texas Administrative Code
TITLE 25
HEALTH SERVICES
PART 1
DEPARTMENT OF STATE HEALTH SERVICES
CHAPTER 131
FREESTANDING EMERGENCY MEDICAL CARE FACILITIES
SUBCHAPTER A GENERAL PROVISIONS
SUBCHAPTER B LICENSING REQUIREMENTS
SUBCHAPTER C OPERATIONAL REQUIREMENTS
SUBCHAPTER D INSPECTION AND INVESTIGATION PROCEDURES
SUBCHAPTER E ENFORCEMENT
SUBCHAPTER F FIRE PREVENTION AND SAFETY REQUIREMENTS
SUBCHAPTER G PHYSICAL PLANT AND CONSTRUCTION REQUIREMENTS

16. Free-Standing Emergency
Departments
Equipment
• Emergency department patient rooms are designed with
the needed equipment and supplies to provide urgent care
for the sick and injured.

17. Free-Standing Emergency
Departments
Medical supplies
• Portable light stands
• Intravenous poles
• Rolling trays (Mayo Stands)
• Crash / Supply Carts
• Med gases – O2
• Suture kits / Ortho Supplies
• Tongue depressors, bandages, gauze
• Culture supplies
• Intubation supplies, bag-valve-masks,
suction tubing
• Nasal cannulas and masks
• Patient gowns, drapes, emesis basins
• Linens
Equipment
• Stretchers
• Defibrillators
• Woods Lamp
• Otoscope / Opthalmoscope
• Overhead lighting
• Rolling Stools
• Imaging (CT, MRI, US, etc)
• Lab – Analyzer, Centrifuge, etc
• Monitors – Mounted / Postable
• Blood pressure cuffs

18. Free-Standing Emergency
Departments
• Imaging / Lab / Pharmacy - Services
• Cardiac Markers / Hematology / Chemistry / Pregnancy Testing / Tissue
Specimens / Blood or Blood Components
• CT / X-ray / US
• Controlled Substances, Floor Stock, Formularies
• DEA, DPS, TSBP Class F Licensed

19. Free-Standing Emergency
Departments
• Staffing / Management
• Although technology is critical, the expertise of medical personnel is just as
important. Licensed nursing staff is required to have current certification in
Basic Life Support (BLS), Advanced Cardiac Life Support (ACLS), and Pediatric
Advanced Life Support (PALS), as well as education and training on
equipment and procedures utilized in the Emergency Department.
• Our Physicians are ready to provide prompt, quality emergency care for
patients of all ages 24 hours a day, seven days a week.

20. Free-Standing Emergency
Departments
• Marketing / Referrals
“We understand how stressful a visit to the emergency room can be.
That's why we now guarantee that you’ll receive immediate access to care
within minutes of walking through our Emergency Department doors”
Dr. Filley, Medical Director
• FSED’s can alleviate congestion of minor care complaints in
the hospital ER’s. In addition, focused demographic group
marketing will target the desired cliental.

21. Mission/Vision/Values
Our Values
We constantly strive to achieve the highest degree of caring, excellence, integrity and results. These
essential core values form the foundation of our relationships with patients, customers, investors,
partners and one another. Extraordinarily high performance standards serve as critical guides for
making important clinical and business decisions. The expression of these standards is evident in our
behavior, our attitude, and our approach to our daily work. The product of our strict adherence to
core values is the ability to harness tremendous organizational energy to achieve our goal of
upholding the highest standard for quality and service within the health care industry. This unique
combination of values, performance standards and commitment serves as the key to our success.
Our Mission
To treat every individual with sincerity, respect and compassion, and provide prompt, affordable,
quality health care every day of the year.
Our Vision
To be the leader in emergency care medicine.

22. Free-Standing Emergency
Departments
• Revenue Cycle Management / Accreditation
• The use of financial clearance solutions in your healthcare revenue cycle enables you to determine
not only insurance eligibility but also the ability and willingness to pay healthcare costs. Including
medical necessity checking during registration, scheduling and ordering can help reduce Medicare
denials and increase reimbursement by providing medically necessary services or by issuing an ABN
for non-covered services.
• Accreditation programs can be accessed to participate in
providing CMS services if desired.

23. Free-Standing Emergency
Departments
Summary…..
Insured and cash pay patients are
seeking alternatives to traditional
healthcare access. Freestanding ER’s
are becoming increasingly popular as
wait times at doctor’s offices and
hospitals are ever lengthening.
Convenient locations, availability of
services, rapid delivery of service and
customer relations are building these
facilities while pulling ahead of the
traditional hospital pack.

24. Questions??
Richard Bays MBA, RN, CPHQ
RBaysConsulting@gmail.com
Office - 832.316.2701