PORT ST. LUCIE, Fla. — When the Cleveland Clinic started acquiring hospitals and medical offices in this palm tree-lined region six years ago, many Floridians were excited. The Ohio nonprofit, ranked among the top hospitals in the world, pledged to bring expert care and an infusion of cash to the state’s Treasure Coast, an area north of Boca Raton brimming with 55-and-up gated communities.
But in the years after the Cleveland Clinic’s blue and green signs popped up outside dozens of medical offices, patients began receiving unexpected bills: an additional $95 for a consultation with a neurosurgeon. An extra $112 to see a family medicine physician. And $174 more for a neurologist appointment that previously cost only a $50 co-pay.
Baffled, the patients contacted their doctors’ offices and insurers and learned that the new costs were “facility fees” — charges that hospitals have traditionally billed for inpatient stays and emergency room visits but are now increasingly charging for routine appointments in their outpatient clinics. The fees, which are often not fully covered by insurance, are meant to support the higher level of care that these doctors’ offices provide, according to hospitals.
For blindsided patients, that can mean paying a hospital fee — even if they never set foot in a hospital.
“My heart dropped,” said Brandy Macaluso-Owens, 43, a social worker who lives in Port St. Lucie. She received a $174 facility fee after a visit in March with a Cleveland Clinic gastroenterologist. “I probably met with the doctor maybe as little as 15 minutes.”
The Cleveland Clinic defended facility fees in an email, saying they are an “appropriate practice” that align “with government regulations and industry guidelines.”
“These fees help support just some of the costs of maintaining outpatient facilities so that we can continue providing high-quality, compassionate care to all patients,” the Cleveland Clinic said.
The Cleveland Clinic is far from the only hospital charging facility fees, which amount to billions of dollars annually for patients across the country. The fees have become pervasive in recent years as major health systems have snapped up doctors’ offices, making it harder for patients to find independent practices: More than half of all physicians nationally are now employed by hospitals or health systems, up from just a quarter in 2012.
For more on facility fees, watch NBC’s “Nightly News with Tom Llamas” at 6:30 p.m. ET/5:30 p.m. CT and “Top Story” on NBC News NOW at 7 p.m. ET.
At the same time, facility fees have become more noticeable because of a rise in high-deductible health insurance plans, which leave patients paying a larger share of their medical bills before their insurance kicks in. A study last year found that the average deductible for employer-sponsored coverage had risen about 47% in a decade.
These factors are affecting many patients who are already teetering financially. About half of adults in the U.S. say they would be unable to pay an unexpected $500 medical bill or would have to go into debt to pay it, according to the health policy group KFF.
Facility fees can run into the hundreds of dollars, and even small amounts can quickly add up.
Did your doctor’s office charge you a facility fee? Here’s what to know
“People are getting really high bills for simple, routine care,” said Christine Monahan, an assistant research professor at the Center on Health Insurance Reforms at Georgetown University who has studied the issue. “They don’t expect to be paying high bills for this. And it’s not realistic to expect people to be able to afford this.”
Opposition to outpatient facility fees is a rare area of agreement between patient advocates and insurance companies, which argue that hospitals are unnecessarily inflating the cost of care. While efforts to restrict facility fees have drawn bipartisan support at the state and federal levels, the hospital industry has pushed back, arguing that the fees are necessary to help fund core services like 24/7 emergency departments, and that insurers should cover them.
These national forces are all colliding in southeast Florida, where 11 patients told NBC News that the Cleveland Clinic had charged them unexpected facility fees in the past several years. For some, the fees were a mere annoyance, a sign of the escalating cost of health care. For others, the bills were a financial burden too big to shoulder. And some are refusing to pay them.
Billie Paukune Boorman, a waitress, was recently charged a $174 facility fee for her 13-year-old daughter’s ear, nose and throat appointment, along with over $200 in other unanticipated charges.
“I don’t have that kind of money laying around,” she said.
The Cleveland Clinic declined an interview request from NBC News and declined to comment on individual cases but said in its email that patients are charged facility fees in doctors’ offices that are classified as hospital outpatient departments, which must meet stricter quality and safety standards than nonaccredited physician practices. The facility fees reflect “the significant added costs to hospitals of complying with these standards,” the Cleveland Clinic added.
The Cleveland Clinic told NBC News that it has sent more than 250,000 letters to its Florida patients informing them of the fees ahead of their appointments, and said it posts signs at its offices saying that they are hospital outpatient departments. Medicare patients receive an additional notice at check-in. The letters that the Cleveland Clinic sent say patients may see “a change from how you were billed in the past” but do not explicitly note that patients may be charged more out of pocket. Many of the patients who spoke to NBC News did not recall receiving the letters.
The health system did not answer questions about how it determines the price of a facility fee but said the costs “vary depending on the facility and the type of medical services provided.”
Several patients said they did not notice any differences in their care after the fees were implemented.
Last year, Irene Rauch, 66, a semiretired human resources executive, was charged a $95 facility fee for an appointment with a neurosurgeon she said she had seen for the same type of appointment three months earlier for just a $15 co-pay. The added charge was not something she had budgeted for.
“I’m grateful for the care that I’ve gotten at the facility,” she said. “Does it justify this unknown fee, when you go to see the doctor for a check-up and you’re in there for five minutes?”
A booming population with growing health care needs
Along Florida’s Treasure Coast, signs of the booming — and aging — population are everywhere. Strip malls full of medical offices pepper the streets, and senior centers bustle with exercise classes and bingo games.
In 2018, the leaders of the Cleveland Clinic saw the area’s growing need for health care and invested in the century-old nonprofit’s first major expansion outside Ohio. Renowned for cardiac surgery, among other specialties, the Cleveland Clinic emphasizes its public health mission, committing over $413 million annually to philanthropy. The health system now owns four hospitals and dozens of outpatient offices across the Treasure Coast, including family health clinics, sleep labs and a wound care center, and it has vowed to be “part of the social fabric of the community.”
The flurry of facility fees did not immediately follow the Cleveland Clinic’s arrival in Florida: Most patients said they only noticed them in the last year or two.
In February, Mark Huber, 60, of Hobe Sound, went to a Cleveland Clinic neurologist whom his wife, Victoria, had seen a couple of times in 2024. The couple had carefully selected the in-network doctor from their commercial insurance plan’s website so they would only have a $50 co-pay. But after his appointment, Mark Huber received a bill for a $174 facility fee.
“We were just floored that this charge came and no one was apologizing,” he said.
Some of the outpatient offices that the Cleveland Clinic has acquired in the region had already been charging facility fees prior to becoming part of its health system, the Cleveland Clinic said in an email to NBC News. It said it began charging fees in the last two years at additional sites to be consistent across its locations.
“We understand this frustration with any change and are transparent with all billing practices,” the Cleveland Clinic said. Patients with concerns can speak to a Cleveland Clinic financial advocate, the organization added.
During a Facebook Live chat with a Cleveland Clinic executive in February, patients expressed confusion and anger about the fees. Dr. Rishi Singh, vice president and chief medical officer of the Cleveland Clinic Martin North and South Hospitals in Martin County, Florida, told the patients that they were now receiving “hospital-level care” that independent doctors don’t offer.
“We are required to have various ways of sterilizing things, to inspect our facilities, to make sure they’re clean, to have air handling, to do all these special things,” he said. “That’s a big difference in the way that the cost is for that.”
Among those who pressed Singh was Virginia MacDonald, who lives in Stuart. She posted in the Facebook chat that her husband had been charged hundreds of dollars worth of facility fees for weekly health care appointments.
In response to her and others, Singh advised patients to talk with their insurance companies about facility fees, which MacDonald said she felt was “ridiculous.”
“There’s always this push and shove over what insurance companies are going to cover,” she said in a recent phone interview. “I just think they found this little hidden charge where they can get away with it.”
MacDonald said Florida Blue, a Blue Cross Blue Shield plan, left the couple responsible for a “huge portion” of her husband’s facility fees.
Insurers argue that facility fees for outpatient visits burden patients and insurance companies with costs that do not improve the quality of care. In an interview with NBC News, a Blue Cross executive criticized them as a way for hospitals to drive up health care costs.
“These fees are tacked on to patient bills with vague descriptions, virtually no transparency as to why, or why they’re being charged,” said David Merritt, a Blue Cross Blue Shield Association senior vice president. “They shouldn’t be tacked on simply to raise revenue for hospitals.”
A push for regulations
The dissatisfaction over facility fees in Florida is mirrored across the country, with patients fuming on social media about the dominant hospital chains in their area, advocates raising concerns that facility fees too often surprise patients, and state legislators seeking to impose limits.
Nineteen states have passed laws related to facility fees, according to the health policy advocacy group United States of Care. Some require only that hospitals warn patients about the fees in advance; others, such as Connecticut, ban facility fees for certain outpatient services. Ohio prohibits facility fees just for telehealth appointments, and other states, such as Indiana, require hospitals to submit annual reports that include their facility fees.
On the federal level, the Trump administration has pushed for protections to shield Medicare patients against some facility fees. A bipartisan proposal expected to be introduced in Congress this year would extend those reforms, requiring Medicare to pay the same rate for common outpatient services whether the doctor’s office is independent or owned by a hospital.
The American Hospital Association opposes efforts to limit facility fees, as does the Florida Hospital Association. In a phone interview, Florida Hospital Association President and CEO Mary Mayhew said hospitals are struggling to cover expenses, especially because Medicaid reimbursement “doesn’t come anywhere close to covering the cost” of many services that Florida hospitals provide. She said facility fees are critical to keeping doctors’ offices and hospitals open and said insurers should cover them.
In Florida, then-House speaker Paul Renner, a Republican, championed legislation last year to clamp down on surprise health care costs, including by requiring medical offices to disclose a patient’s facility fees in advance.
“Unlike going to the grocery store where you can look at price per gallon of milk or the price per pound of an item, in health care, we know what we’re told and we pay what we’re told, but not before the fact,” Renner said in a recent interview. “We get that explanation of benefits afterwards that’s very opaque and hard to follow what you pay, your insurance pays, and it disempowers patients.”
Existing Florida law requires facilities to share good-faith cost estimates with patients who request them. Eventually, the law will require these doctors’ offices to notify all patients about their estimated facility fee costs before they see medical providers — but that portion of the law is not yet in effect.
As patients discover the facility fees on their bills, some are switching to independent doctors to avoid the extra costs. In many cases, that means traveling farther for care: Dr. Evelio Sardiña, who practices concierge medicine in Jupiter about 45 minutes from Port St. Lucie, has heard these patients’ frustrations firsthand.
“If you’re being charged a new fee, you expect there to be a new service,” Sardiña said of his conversations with patients. “It comes right down to, ‘What is the service I’m getting for the money that I’m now being charged?’ And the answer is, ‘I’m not getting any new service — I’m just paying more, so I’m feeling a little more taken advantage of.’”
One of the few Cleveland Clinic patients NBC News spoke to who remembered receiving notice in advance to expect a facility fee was Cindy Aaron, 68, who lives in Fort Pierce. A bladder and kidney cancer survivor, Aaron must see a urologist every six months to make sure she is still in remission. After receiving a letter in the mail from the Cleveland Clinic informing her of the new facility charges, she called to request an estimate ahead of her appointment in April.
The 15-minute urologist appointments, which previously cost her only a $35 co-pay, would now cost an estimated $300, the Cleveland Clinic told her.
She canceled the appointment.
“This is a rip-off,” Aaron said. “I’ve never seen anything like this before.”
Elizabeth Chuck reported from Port St. Lucie, Florida; Maite Amorebieta reported from New York.
