The ERs that can turn patients away — and are reaping millions

STAT News – Monday, June 29, 2026
By Tara Bannow

Robert Behounek walked into the Albuquerque emergency room last fall with telltale signs of a heart attack.

For weeks, he’d been having trouble breathing and terrible swelling all over his body. What began as searing pain in one of his arms was now a relentless ache in his chest. The receptionist at Albuquerque ER & Hospital asked for his health insurance card, but he didn’t have insurance. She told Behounek that his visit could cost upward of $1,600.

“I said, ‘I don’t have that. Can you just bill me afterward? I’m worried I’m having a heart attack,’” Behounek recalled. “She just said, ‘There’s nothing we can do for you. We can’t see you here unless you pay the cost first.’ I said, ‘But you guys are an ER,’ and she said, ‘We’re not that kind of ER.’”

For the past 40 years, it’s been illegal in the U.S. for emergency departments to turn away patients because of an inability to pay. But that only applies to hospitals that contract with Medicare. Houston-based Nutex Health, which runs the hospital Behounek visited, has opted not to at most of its hospitals, so it’s not bound by that law. Nutex claims it complies voluntarily, screening every patient to ensure they’re not dying before demanding payment. But some patients say they were never screened.

In this way, Nutex is able to have the best of both worlds: It charges emergency department prices while avoiding the responsibilities that usually come with being an ER; namely, taking all comers. It’s just one way Nutex has enriched itself and its investors through exploiting loopholes in laws meant to protect patients. In recent years, that’s meant funneling most of its bills through a surprise billing ban’s arbitration process, even though it’s meant to be a last resort. It’s been a gold mine, quadrupling its revenue.

“There is a growing for-profit business model that is exploiting the benefits and higher revenue that comes with providing emergency care without taking on the risks or obligations of being an emergency department,” said Amber Sabbatini, an associate professor of emergency medicine at the University of Washington. Nutex is one of several companies running microhospitals and freestanding emergency departments, although many are run as satellites of traditional hospitals. They tend to open in wealthier areas where people are likely to have insurance.

The federal arbitration process set up under the No Surprises Act has been a stunning success for providers. Not only are they winning in over 80% of cases, they’re securing payments that are three to nine times in-network rates. The program, known as independent dispute resolution, has also been slammed with far more disputes than federal officials had expected. Because of that, it cost at least $5 billion between 2022 and 2024 alone, potentially wiping out the savings Congress expected it to generate.

For Nutex, this arbitration process has generated eye-popping returns. In less than a year, the company more than tripled its revenue and profit soared nearly twelvefold. The numbers are so dramatic, in fact, that some investors view the money-making strategy as a house of cards. Several are suing Nutex over what they say is an unsustainable reliance on arbitration wins and a precarious alignment with HaloMD, a middleman whose tactics are the subject of multiple lawsuits.

Nutex maintains it’s just trying to get paid in-network rates for its services. No more, no less. But federal arbitrators are awarding payments for HaloMD’s clients, of which Nutex is among the biggest, that are almost nine times the median in-network rates. Providers, Nutex included, accuse health insurers of manipulating the purported in-network rates used in arbitration so they appear artificially low.

In Idaho, the state’s Blue Cross plan says Nutex often seeks payments in arbitration that are 10 times Medicare rates. In one instance, the company charged nearly $3,000 to treat a runny nose, when the median commercial rate is $376. The state’s insurance department told STAT it’s investigating Nutex’s use of arbitration.

There was also a congressional inquiry into Nutex’s charges for Covid-19 tests during the pandemic. Dozens of patients reported being charged thousands of dollars to be tested in Google reviews, and STAT verified some of their accounts.

The key question when it comes to Nutex is whether its microhospitals provide any value to patients over and above their existing options, said Matt Wolf, a health care financial consulting leader with Elliott Davis Advisory.

“I think if the answer is no, then they are going to get found out,” Wolf said.

‘If the patient is dead, you wouldn’t hear about it’

Nutex’s CEO, Tom Vo, spent about a decade working as an emergency physician in Texas before opening hospitals of his own. Today, Nutex has 27 hospitals in 12 states, but that number is growing rapidly, with 15 more hospitals in various stages of development.

Vo describes Nutex’s facilities as “safety-net hospitals,” twisting the term on its head. “Safety-net hospitals” generally mean facilities that treat high proportions of uninsured, Medicaid, and Medicare patients and that don’t turn people away. In 2025, just 1% of Nutex’s revenue came from Medicaid and Medicare, and the company’s financial report contains no reference to providing charity care.

Still, Vo claims Nutex’s hospitals screen all patients for emergency conditions, and never turn away someone who is dying because they can’t pay, instead treating them “pro bono.”

“We provide a lot of free care; people don’t realize that,” Vo told STAT in an interview. “Let’s say you come in and you don’t have insurance. If you’re going to die, we treat you. We’re not going to let anybody die.”

But some patients say they were never screened prior to a demand for payment.

Behounek said no one at Albuquerque ER & Hospital performed any kind of screening on him. No one checked his blood pressure, put a stethoscope on his chest, or offered to call an ambulance. Instead, he drove himself to Presbyterian Hospital about 8 miles away. There, he was quickly evaluated and taken by ambulance to Presbyterian’s hospital in Rio Rancho about a half hour away.

In Rio Rancho, doctors diagnosed the 34-year-old with systolic heart failure and told him he’d already suffered a minor heart attack. He was hospitalized for about a week and had a stent inserted.

Reflecting on his experience with Nutex, Behounek feels angry, but also worries what could happen if others are turned away in emergencies.

“It was literally just, ‘No money, you don’t get treatment,’” he said. “They say they don’t do that, but they absolutely 100% will turn you away if you don’t have the money upfront. They don’t care.”

Asked to respond to Behounek’s account and that of the other patients STAT interviewed, Nutex shared a written statement that said its review of the company’s medical records and billing documentation did not substantiate their allegations. The company also said it can’t comment on the specifics of individual patients’ treatment or billing.

Julie Bliss had a similar experience at Nutex’s Oklahoma ER & Hospital in the Oklahoma City area in 2023. It was late at night on a weekend and the family was up watching movies, when her 11-year-old daughter suddenly passed out and had what looked like a seizure. When her daughter came to, she was disoriented and didn’t know what had happened.

Bliss called 911, but because it was taking too long, she rushed her daughter to the Nutex hospital about two minutes from her house. They were taken into an exam room right away. A clinician was about to begin assessing her daughter, when Bliss said a billing person stopped them and said, ‘No, no, we can’t start treatment. They’re not paying.’ At that point, no one knew whether Bliss’ daughter was stable or about to have another episode.

“I didn’t know what was going on with my, at the time, 11-year-old, and they were super argumentative,” Bliss said. “That’s when I was finally like, ‘What do we need to pay to get her seen? My child is in distress.’”

Bliss is a tribal member and typically gets medical bills reimbursed through the Indian Health Service. She thought that’s what would happen there, too. Ultimately, she handed over her credit card and was charged $100 to start treatment.

The visit didn’t lead to a diagnosis. That came later after lots of testing with their pediatrician. It turns out Bliss’ daughter had passed out because of vasovagal syncope, a sudden drop in blood pressure that reduces blood flow to the brain.

Bliss got a $7,500 bill from Nutex in the mail. After she posted a negative Google review about her experience, she said an administrator called her and told her they would use it as a learning experience. They forgave the bill.

“It was a very traumatic experience on top of another traumatic experience,” Bliss said.

When asked to comment on patients’ claims that they were refused care unless they paid upfront, Vo said in an interview that that wouldn’t happen unless a doctor had examined them and determined they were not going to die that day. He said Nutex abides by the federal Emergency Medical Treatment and Labor Act, or EMTALA, which requires Medicare-participating hospitals to evaluate anyone who presents to their emergency departments regardless of their ability to pay. If those patients are found to have emergency medical conditions, hospitals are required to treat them.

Vo said the fact that patients were able to write negative reviews about their experiences proves their conditions weren’t really life threatening.

“If the patient is dead, you wouldn’t hear about it,” Vo said.

A ‘never event’

One week before Christmas in 2023, Kyle Webb showed up at the same Albuquerque hospital as Behounek.

In an exam room, Webb, 40 years old and father to a young daughter, said he’d heard voices coming from the lobby speakers. They said someone was going to kill him. The clinician wrote that Webb was experiencing a life-threatening emergency. His medical records, referenced in a later lawsuit, note severe distress and paranoia.

But instead of being treated or transferred elsewhere, Webb simply left through Albuquerque ER & Hospital’s front doors. Directly after that, he killed himself.

The National Quality Forum and the Joint Commission, two organizations that assess hospital safety, consider the unauthorized departure of a patient who does not have decision-making capacity to be a “Serious Reportable Event,” otherwise known as a “never event.” A patient suicide that occurs in a health care facility or within seven days of discharge is also considered a never event.

New Mexico law requires hospitals to report these events to the health department, but Marina Piña, a health department spokesperson, said Nutex never reported Webb’s case. Piña said the department is now investigating the matter.

Nutex said it did not believe it was required to report the incident involving Webb, and that it did not learn of Webb’s death until this year, after his father sued.

“After reviewing the medical records and speaking to the facility, we have determined there was nothing in the care of the patient nor his refusal of care that rose to the level of a reportable incident,” Vo said by email.

Lisa Curtis, the Albuquerque attorney representing Webb’s father in his suit against the hospital, said emergency rooms must have protocols for instituting involuntary psychiatric holds on patients who pose a danger to themselves or others. That typically includes locking their room and removing hazardous items. None of that was done in Webb’s case, Curtis said.

“It feels like somehow Albuquerque ER & Hospital only wants to be an emergency room sometimes,” Curtis said. “It doesn’t want to be an emergency room when it’s really an emergency and you’ve got to have policies and procedures in place on how to do involuntary holds on people. They don’t seem to understand that they have to do that.”

Nutex is currently seeking to have the lawsuit dismissed on a technicality, arguing that it was filed against the wrong corporate entity.

Nutex’s hospitals recorded almost 200,000 visits in 2025, and many of those patients appeared to have positive experiences. In glowing Google reviews — which Vo frequently references during interviews and investor presentations — people praise the hospitals for their friendly staff, short wait times, and convenience.

“Everywhere we open, patients love us,” Vo said in a January investor presentation. “We’re valuable to society.”

A miraculous rebound

From its start in 2011, Nutex has been largely out-of-network with health insurers. That way, there’s no limit on how much the company can bill for services. The company has also opted not to accept Medicare, Medicaid, and other forms of government insurance at all but two of its hospitals. Vo explained that contracting with the Centers for Medicare and Medicaid Services involves a lot more rules and restrictions.

Before the No Surprises Act took effect in 2022, out-of-network providers could bill patients for the difference between their total charges and what the patients’ health insurers covered, often resulting in massive bills. The new law threw a wrench in that tactic. Now, those providers can’t bill patients for more than their in-network copays or deductibles for emergency services and for services provided at in-network facilities.

Several providers that relied on balance billing patients went bankrupt. Nutex was very nearly one of them.

Vo claims his company, unlike its peers, did not rely on billing patients for anything their insurers didn’t cover before the No Surprises Act, though there are numerous Google reviews from people who said they received exorbitant bills from Nutex before 2022.

Instead, Vo said Nutex initially struggled under the No Surprises Act because health insurers paid less after the law was implemented. “They’re crooks,” he said in an interview.

Nutex took home gross profit of $158 million and $179 million in 2020 and 2021, respectively. In 2022, that sunk to just $13 million.

It got worse. In April 2024, Nutex’s stock price fell below $1, triggering a warning from the Nasdaq that the company could be delisted. In response, Nutex put a moratorium on building new hospitals, and considered closing existing ones.

It also took more drastic actions, performing two reverse stock splits, a maneuver that reduces the total number of outstanding shares and increases their price.

By this time, providers had discovered that the No Surprises Act’s arbitration process was their saving grace, delivering them payments well above insurers’ contracted rates. In July 2024, HaloMD began ushering Nutex’s disputes through arbitration, a partnership that wouldn’t be publicly disclosed for another year. By the first quarter of 2025, Nutex’s revenue had more than tripled compared with the first quarter of 2024. It made $118 million in gross profit, compared with just $10 million in the prior-year quarter.

At the end of 2024, Nutex reported meeting its goal of sending up to 70% of bills to arbitration. That’s despite the fact that Congress designed the program to be used only after attempts to negotiate with insurers had failed.

By the end of 2025, Nutex’s finances were unrecognizable. Revenue had nearly quadrupled from its 2022 trough, from $219 million to $875 million. The company reported $444 million in gross profit in 2025, a margin of 51%.

Not all of Nutex’s investors saw the windfall as a good thing. In July 2025, the activist investor Blue Orca Capital issued a short report on Nutex that unveiled HaloMD as the secret sauce behind Nutex’s rebound. By that time, three health insurers had already sued HaloMD, although one of the cases has since been dismissed. It was only a matter of time before an insurer sued Nutex, too, the report said. Nutex’s stock fell 16% the day after the report came out.

Lawsuits did follow, but from investors, not insurers. Now consolidated, they echo the accusations from the short report: that Nutex hid its partnership with HaloMD. In so doing, they say Nutex concealed the risks of its current strategy, which include clawbacks from health insurers, lawsuits, or regulatory changes that put the kibosh on the tactic.

In its response, Nutex said that the consolidated lawsuit fails to state a claim because it relies on unadjudicated lawsuits against HaloMD and a biased short report. A pending decision on Nutex’s motion to dismiss will determine whether the case moves forward.

In an interview with STAT, Vo said neither the investors suing Nutex nor Blue Orca Capital understand the “nitty-gritty” of his business.

‘Flabbergasted’ by the bills

The first thing Tim Roe asked when he walked into Post Falls ER & Hospital in Post Falls, Idaho in 2024 was whether the hospital was in-network with his health insurer, UnitedHealthcare. The receptionist said yes, so he stayed, he recalled.

A mechanic, he’d been grinding metal at work, and a piece of debris landed in one of his eyes. After filling out the necessary paperwork, he was taken to an exam room, where a doctor placed drops in his eye and shined a flashlight. The doctor said there was nothing in there, and Roe left. He guessed he was at the hospital for 15 minutes.

Not long after, the bills came in totaling roughly $6,000, of which Roe was on the hook for about half. It turns out, the hospital did not have a contract with his health insurance.

Roe said he understands an ER visit is expensive, but had he been given accurate information, he would have gone somewhere that accepted his insurance.

“There’s five other places in town that I could have gone to; this one just happens to be near my work,” Roe said. “I was taking them at their word that they’re in-network. I wouldn’t expect them to lie about something like that, but they did.”

Roe isn’t the only one who’s felt misled. Google reviews of other Nutex hospitals contain similar complaints. People report either calling ahead or asking at the front desk to learn whether the hospital was in-network with their insurance. They were told it was, only to find out later that it was not.

It’s not unusual for freestanding emergency departments and microhospitals to blur their insurance status. In fact, some experts say these operators want to be mistaken for urgent care clinics so they can attract people with minor ailments and charge hospital-level prices for their treatment.

Before a 2019 state law barred the practice, it was common for freestanding emergency departments to use misleading signage like “we welcome” or “we accept” followed by a list of carriers that they’re not actually contracted with, said Daniel Marthey, an assistant professor of health policy and management at Texas A&M University. Nutex has eight hospitals in Texas, and they’re subject to the law.

Even with the law, Marthey said some facilities still make it confusing. “You are likely to show up at one of these facilities not knowing if you are in-network,” he said.

During the Covid-19 pandemic, several patients said Nutex charged their health insurers between $2,000 and $5,000 for Covid tests, including tests performed at drive-up sites. Vo said Nutex never billed for Covid tests in isolation, and that those bills are for ER visits.

Carrie Caviness, her husband, and their three sons got Covid tests at a Phoenix-area Nutex hospital in 2020, drawn by a sign out front advertising free Covid tests. The receptionist told Caviness they accepted her insurance. A few months later, she started receiving checks from her Blue Cross Blue Shield plan for seemingly random amounts like $4,000 and $1,600.

Confused, she called the hospital and was told that because Nutex didn’t contract with her plan, she had to cash the checks and pay the hospital directly. She complied, but kept careful notes. The Blue Cross payments for the five tests amounted to about $21,000. Caviness didn’t have to pay anything.

“I just was very bothered that a company could do that during this time,” Caviness said. “I could go to the store and get a Covid test for $20. How can you charge us $21,000 for five people?”

Mark Raskin had a similar experience. After his son, a college freshman, received a drive-up Covid test at Nutex’s facility in The Colony, Texas in 2020, Raskin said Nutex billed his insurance $4,400. Nutex charged for an emergency room visit with Covid as a secondary concern. Raskin did not have to pay any of the bill; he’s unsure how much his insurance paid.

“I thought it was an outrageous ripoff to charge that much to do a Covid test,” Raskin said. “If you had gone into the ER with symptoms and they had to do EKGs and blood tests, I get it, but to just swab somebody’s nose out in a parking lot does not warrant $4,400 bucks in any world.”

Vo maintains that Nutex charges hospital prices because its facilities are hospitals. They’re always open and staffed with emergency-trained physicians ready to treat anyone who comes through. They also operate expensive imaging and lab equipment, he said.

“If you go to urgent care, you don’t have those specialists,” Vo said. “You might be seen by a nurse practitioner. They don’t have all the training and equipment and they’re not open 24/7. So that’s why we have to bill a little bit higher, because we are a hospital.”

A STAT analysis of hospital prices found that Nutex’s standard charges were lower than the national average for six out of nine common emergency room billing codes.

For example, Nutex’s hospitals charge $643 for a laceration repair, compared with the national average of about $1,300 in data compiled by Turquoise Health. For a high-severity emergency department visit, Nutex’s hospitals charge about $4,600, below the national average of $4,900.

Vo co-founded a freestanding emergency room company called Neighbors Emergency Center in 2008. Patients accused Neighbors of overcharging for services in online reviews dating back to 2015. On a Nutex earnings call last year, Vo said he left the company in 2011 to start Nutex. Neighbors filed for bankruptcy in 2018.

Josh Reid of Albuquerque went to the Nutex hospital near his house, Albuquerque ER & Hospital, in excruciating low back pain last year. The 55-year-old thought maybe something was wrong with his kidneys. After checking in and handing over his insurance card, he didn’t wait long before being taken into an exam room. He had blood drawn and a CT scan performed, and then a doctor told him they couldn’t find anything wrong. He told Reid to go home and rest.

While he was in the exam room, Reid said someone popped in and asked if he wanted to pay his $500 copay. He declined and asked Nutex to send him a bill, thinking it would just be for the copay. About three weeks later, he got two bills: one for the doctor and another for the facility. In total, Nutex charged his Blue Cross Blue Shield plan roughly $20,000 for the visit, over $3,000 of which was his responsibility.

“I was just flabbergasted to get these bills,” Reid said.

Reid said he regrets going to that hospital. The pain eventually resolved itself, but the experience has left a bad taste in his mouth.

“Our medical system is messed up,” he said.

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