Study finds millions of Americans have billions of dollars in medical debt
A study by West Health and Gallup Healthcare found that 31 million Americans will have $74 billion in medical debt by 2024.
Suzanne Maguire, who was a regular visitor to a doctor’s office in suburban Boston, had small plugs placed in her tear ducts to treat persistent dry eye. She paid $600 for the procedure, which only took a few minutes.
A few weeks later, the Arlington, Massachusetts, woman received a second bill in the mail for about $600. She thought it was a billing error and called the hospital. However, the employee explained that it was not a mistake. The second bill included facility fees charged by an affiliated hospital, Boston-based Mass Eye & Ear, which McGuire never set foot in.
Maguire, who works as a financial planner, scrutinizes her medical bills because she has a health insurance plan with a $3,000 medical deductible. A deductible is the amount that must be paid before insurance coverage applies. When she saw the hospital bill for a visit to a suburban doctor, she was perplexed.
“It was shocking,” Maguire said. “I was 24 miles from the hospital.”
Mass Eye & Year said in a statement that the suburban clinic is a hospital-licensed facility and is transparent about its billing practices.
Hospital-run doctors charge additional fees
Hospitals are increasingly acquiring independent clinics and clinics and charging admission fees for such non-emergency visits. In 2024, approximately 55% of physicians will work in a hospital or health system, more than double the number in 2012.
People who visit these hospital-owned clinics may receive two bills: one from their doctor and one from the hospital, even if they never received treatment within the hospital. In other cases, consumers may receive a single bill from health care providers and hospitals that includes charges.
According to the Ambulatory Outrage 2026 report released by the U.S. Public Interest Research Group (PIRG) on January 29, hospitalization costs for doctor and clinic visits range from $50 to more than $1,000 and are often assessed without warning patients.
PIRG officials said the report highlights the growing trend of hospitals charging for routine care. People often visit doctors’ offices and clinics to prevent health problems from worsening. This type of “outpatient” treatment, done in a doctor’s office or doctor’s office, is usually less expensive than treatment in a hospital.
“The whole point of preventive care is to save overall costs and help people get regular health checkups,” said Patricia Kelmer, senior director of health care campaigns at PIRG. “Yet we are being billed as if we were lying in a hospital bed.”
The American Hospital Association said facility fees provide the resources needed for 24-hour emergency and trauma care in hospital emergency rooms. In addition to inpatient care, hospital-owned outpatient clinics often treat more seriously ill patients and face stricter regulations, the AHA said.
“Facility fees are an important way for hospitals to pay to maintain all the critical services and capabilities they provide to their patients and communities, especially as Medicare and Medicaid continue to underpay hospitals and private health insurance companies,” said Molly Smith, group vice president for policy at the American Hospital Association.
However, consumers are struggling to pay unexpected charges.
Todd Bash, 60, of West Covina, California, was charged more than $14,000 in facility fees for shots he received at a hospital-run pain clinic in Los Angeles. The health insurance company reimbursed the hospital more than $1,800, and Bash paid more than $450.
Frustrated, Bash asked his insurance company for a list of pain clinics in his area that were in their network. He called the providers on the list, but most were hospital-owned or didn’t take insurance. He eventually found an independent clinic where pain injections cost just $37.
PIRG’s report found that New Mexico women spent more on facility fees than they paid to health care providers during multiple visits to hospital-owned primary care clinics and specialists in 2025. For the same visit, the nurse charged $73 and the hospital charged $92.
According to PIRG, hospitals add fees to their own outpatient clinics and offices for medical services such as routine exams, mammograms, colonoscopies and telemedicine appointments.
Maguire, who lives in Massachusetts, paid $180 in 2024 for several telemedicine appointments with a nurse who prescribed anxiety medication. Starting in 2025, mental health hospitals that employ nurses will more than double their facility fees.
When Maguire first complained about the extra charges, the nurse was not aware that the hospital charges were being assessed. So Maguire switched to a non-hospital telemedicine prescriber and now pays $120 per appointment.
Hospital treatment costs 2 to 4 times more
Research shows that when hospitals acquire outpatient clinics and surgery centers, they often increase costs for people seeking non-emergency care.
A study funded by Arnold Ventures reported that older Americans on Medicare pay two to four times more for services in hospital-owned outpatient departments than in privately run clinics.
Several states are scrutinizing outpatient hospital charges, and consumer advocates are calling for better protections and disclosures for patients. A total of 22 states have passed laws or regulations addressing facility fees, said Christine Monahan, an assistant professor at the Georgetown Center on Health Care Reform.
State laws are often aimed at assisting consumers through better disclosures and other protections.
“This will help consumers avoid sudden high bills like this,” Monaghan said.
Monaghan said consumers often don’t have the cash to pay the extra charges. Insured consumers often have to pay a deductible or coinsurance, which requires them to pay a portion of their medical costs.
“Every dollar really matters,” Monaghan said. “These fees are occurring in more and more places and are becoming a major problem in consumers’ daily lives.”
Monahan said hospital facility fees also contribute to increased U.S. health spending on government health programs such as Medicare, Medicaid and private insurance companies. Insurance companies then increase monthly premiums for workers who have purchased Affordable Care Act coverage and for employers who sponsor individual health insurance plans.
Americans who buy ACA insurance on their own are paying significantly more because the enhanced tax credit expires at the end of 2025. KFF, a health policy nonprofit, estimated that the average cost for the 22 million Americans with subsidized ACA insurance more than doubled in January.
A KFF tracking poll released on January 29th reports that Americans’ top financial concern in 2026 is health care affordability. About one in three poll respondents said they were “very concerned” about their ability to pay for health care. According to the KFF poll, health care topped other common affordability concerns, including paying for groceries, rent or mortgage, utilities, gas and transportation.
PIRG: Consumers need more protection
PIRG officials said states and consumers can take steps to protect themselves from unexpected medical costs.
Before receiving treatment at a doctor’s office or clinic, consumers should ask the clinic staff whether there is a facility fee.
Insurance companies may be hesitant to pay hospital charges for outpatient visits. As a result, consumers will have to pay the additional costs out of pocket, Kelmer said.
PIRG’s report also recommended states enact stricter reforms to limit fees and protect consumers.
Twenty-two states have enacted some reforms, but none have eliminated the surcharges that hospitals charge for outpatient clinics. PIRG recommends that states adopt a “same service, same price” standard that prohibits price differences.
PIRG also recommends the following conditions:
- Protect patients by prohibiting the collection of facility usage fees for routine outpatient treatment.
- Require all healthcare providers to have a unique billing identifier. This allows consumers and insurers to clearly see which providers are billing, rather than allowing a single billing identifier for all locations owned by a hospital or other entity.
- Require public reporting of all facility fees and payments.
Contact the reporter at alltuck@usatoday.com..
