The Hidden Cost of Healthcare: Understanding Surprise Facility Fees
When a Doctor’s Visit Comes with an Unexpected Price Tag
Imagine walking into your trusted doctor’s office for a routine checkup, only to receive a bill weeks later that makes your jaw drop—not because of the medical care you received, but because of mysterious charges that seem to have nothing to do with your actual treatment. This is becoming an all-too-common reality for patients across America who visit hospital-owned medical practices. These surprise charges, known as facility fees, can range anywhere from a modest $25 to eye-watering amounts in the thousands of dollars. They’re appearing on bills for seemingly straightforward services: your annual physical, a quick strep throat test, or even a telehealth appointment conducted from the comfort of your own home. According to consumer advocacy group U.S. PIRG, these fees represent a growing financial burden that’s catching patients completely off guard and fundamentally changing the landscape of healthcare costs in America.
The original purpose of facility fees was actually quite reasonable—they were designed to help hospitals cover their genuinely high operational costs. Running a hospital is an expensive undertaking, with round-the-clock staffing, specialized medical equipment, emergency services, and the infrastructure to provide overnight care. These legitimate expenses justify certain additional charges. However, the situation has become problematic as hospitals have increasingly acquired independent physician clinics and small practices that don’t face these same hospital-scale expenses. When your neighborhood doctor’s office gets purchased by a large hospital system, patients continue visiting the same building, seeing the same doctor, and receiving the same care—but suddenly their bills include charges meant to offset hospital costs that have nothing to do with their outpatient visit. As Patricia Kelmar, senior director of health care campaigns at U.S. PIRG, explains it plainly: “We don’t want to pay hospital fees for services that we never stepped into the hospital for.” This practice is not only driving up healthcare prices but is also causing people to think twice about getting their regular treatments and checkups, which could lead to more serious health problems down the line.
The Growing Scope of the Problem
The emergence of facility fees is a relatively recent phenomenon that has exploded in frequency over the past couple of years, with these charges first becoming noticeable in 2023. Their proliferation directly corresponds with a significant shift in how healthcare is structured in America—the ongoing consolidation of independent medical practices under hospital ownership. Today, approximately half of all community medical practices are owned by hospitals rather than operating as independent entities. This means that for many consumers, encountering these facility fees has become virtually unavoidable. You might have been visiting the same family doctor for years, building a relationship and trust, only to discover that your physician’s practice has been quietly acquired by a hospital system. Nothing about your care changes—same doctor, same exam room, same medical procedures—but the billing suddenly transforms, and you’re now subject to facility fees that weren’t part of your healthcare costs before.
What makes this situation particularly frustrating for patients is the lack of transparency and advance notice. In most states, there’s absolutely no requirement for hospitals or medical practices to inform patients ahead of time that they’ll be charged these additional fees. Kelmar describes a scenario that many patients have experienced: “People don’t know before they go, or they see a sign in the doctor’s office after they have taken off work, hired a babysitter, that says, ‘This place may charge a facility fee,’ with no dollar amount.” By the time you spot this vague warning, you’ve already invested time and resources into your appointment—you’ve arranged childcare, taken time off from work, and traveled to the office. The sign provides no specific information about how much you might be charged, and backing out at that point means wasting all the effort you’ve already put in. As Kelmar rightly points out, “Day-of notice is no help. At that point, it’s too late.” This lack of upfront transparency prevents patients from making informed decisions about their healthcare and comparing costs between different providers.
Real People, Real Financial Impact
The abstract concept of facility fees becomes painfully concrete when you hear stories from people who’ve been affected. Beth Davis from Mentor, Ohio, experienced exactly the kind of billing shock that’s becoming increasingly common. She visited a hospital-owned doctor’s office seeking treatment for carpal tunnel syndrome, a condition causing wrist pain that affects her daily life. The treatment was straightforward—a cortisone injection to reduce inflammation. She returned a month later for a second injection, the same simple procedure in the same outpatient setting. What happened next left her stunned. The bill for that second shot totaled $2,667.45, an amount that seems absurd for a procedure that took just minutes to complete. When Davis examined the itemized charges, the breakdown revealed the problem: a facility fee described as “Ancillaries and Observation Room” accounted for $2,418 of the total—the overwhelming majority of her bill. The actual clinic costs were just $156, with a pharmacy charge of $93.45.
Davis’s frustration is completely understandable when you consider what actually happened during her appointment. “I wasn’t even observed. The doctor walked in and gave me a shot—there wasn’t even an assistant,” she explained. She received no special observation, no use of specialized equipment, no hospital-level care that might justify such a massive charge. Her insurance covered about $1,000 of the costs, but that left her personally responsible for $1,618—a significant financial burden for a simple injection. Davis is refusing to pay this amount because she doesn’t believe it’s justified, and she represents a growing number of patients pushing back against these charges. Perhaps most troubling is that she had no idea these fees existed until the bill arrived. “I didn’t even know such a thing existed. We were never notified of this charge,” she said. Her experience illustrates how facility fees can transform affordable, routine medical care into a financial crisis for ordinary families, and how the lack of transparency leaves patients feeling blindsided and helpless.
The Patchwork of State Protections
Currently, only 21 states across the nation offer consumers any meaningful protection from facility fees, creating a frustrating patchwork where your rights depend entirely on where you happen to live. Of those 21 states with some protections, nine have taken the step of banning facility fees in outpatient facilities—but even these bans come with significant limitations, as they only apply to certain specific types of medical care. This means you might be protected from facility fees for one type of appointment but completely vulnerable to them for another, creating confusion for patients trying to understand their potential costs. Meanwhile, 13 states have implemented requirements that healthcare providers must notify patients that facility fees might apply to their visit. While notification is certainly better than nothing, it doesn’t actually prevent the charges—it merely warns you that they’re coming, often without specifying how much you’ll be charged.
Consumer advocates like Kelmar argue that these existing regulations simply don’t go far enough to shield people from surprise medical bills. “It’s just undermining the whole system,” she explains. “We have to get rid of facility fees and encourage more states to collect data and require more hospitals to report the fees providers are collecting.” The lack of comprehensive data makes it difficult to understand the full scope of the problem and advocate for meaningful reform. Without transparency and reporting requirements, patients have no way to comparison shop for healthcare or make informed decisions about where to seek treatment. “We need some level of reporting. People need to know,” Kelmar insists. The current system leaves too many Americans vulnerable to charges they never anticipated, for overhead costs completely unrelated to the care they actually received.
The Broader Healthcare Affordability Crisis
The issue of facility fees exists within a much larger context of healthcare affordability concerns that keep Americans awake at night. According to recent polling from KFF, a respected health policy research organization, two-thirds of Americans report feeling very or somewhat worried about their ability to afford healthcare. What makes this statistic particularly striking is that healthcare costs now top the list of financial concerns for Americans—ranking above worries about affording groceries, keeping the lights on, or making housing payments. Think about that for a moment: in a time of rising costs across the board, when people are struggling with everything from rent to food prices, healthcare expenses cause more anxiety than any other financial obligation. Among those worried about healthcare costs, one-third describe themselves as very worried—not just concerned, but deeply anxious about their ability to pay for medical expenses.
This intense anxiety about healthcare costs has real-world consequences that extend far beyond financial stress. When people are worried about surprise bills and hidden fees like facility charges, they begin to avoid or delay necessary medical care. Annual checkups get postponed. Concerning symptoms go uninvestigated. Preventive care falls by the wayside because people fear the potential costs more than they fear potential health problems. This avoidance behavior can lead to minor health issues developing into major medical crises that are both more dangerous for patients and ultimately more expensive to treat. The irony is painful: in trying to avoid surprise medical bills, people may be setting themselves up for even larger healthcare costs down the road, not to mention the human cost of suffering and reduced quality of life. Facility fees, by adding unpredictable charges to routine care, directly contribute to this vicious cycle of avoidance and delayed treatment. When you can’t trust that a simple doctor’s visit will come with a reasonable, predictable bill, the rational response is to avoid the doctor’s office altogether—a response that serves neither patients nor the broader healthcare system well.
The path forward requires comprehensive reform that prioritizes transparency, patient protection, and fair billing practices that reflect the actual care provided rather than the corporate structure of the healthcare provider. Patients deserve to know what they’ll pay before they receive care, and they deserve bills that accurately reflect the services they actually received in the setting where they received them.
