Uncovering Systemic Corruption in the ER: An Empirical Analysis of Motor Vehicle-Related Hospital Bills and their Impact on Insurance Companies

Abstract

With the advent of automated and assisted vehicle technology, the prospect of significantly decreasing motor vehicle accidents is imminent. However, accidents resulting in emergency room visits provide revenue for hospitals by charging automobile insurance companies for services to treat injured individuals. Statistical methods are used to investigate discrepancies in charges associated with motor vehicle accident injuries among different payers including: automobile insurance providers, Medicare, Medicaid, self-pay, and others. Charges for treatment of similar injuries with different causes are also evaluated. Results from 2011 data for New Jersey show that patients admitted to the emergency room (ER) after falling or being struck have significantly less expensive medical bills than patients that enter the ER from a motor vehicle accident. Differences in services for treating patients show hospital bias toward automobile insurers who provide generous reimbursements in New Jersey.