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ANNAPOLIS — Two hospitals that operate separate emergency centers want the state to regulate their centers' rates so they can receive Medicare and Medicaid reimbursement.

But legislation before the General Assembly that addresses their desire is opposed by the Maryland Health Care Commission, a sister agency to the one that would regulate the centers' rates.

Currently, the two emergency centers in Maryland do not fall under the oversight of the Health Services Cost Review Commission, which regulates fees at facilities that are required to have certificates of need to operate. The emergency centers do not have certificates of need.

The legislature directly approved the facilities over the objections of the Maryland Health Care Commission, which issues the certificates of need.

Without state regulation, the centers are not eligible to be reimbursed for institutional fees, under current Medicare and Medicaid rules.

Officials connected to the two emergency centers — one that operates as a free-standing facility in Germantown and one that is under construction in Grasonville in Queen Anne's County — said the Medicare and Medicaid fees are crucial to their bottom line.

"We're stuck in a Catch-22," said Robert Jepson, associate vice president of government affairs for Shady Grove Adventist Hospital, which operates the Germantown emergency center.

The Germantown center lost $847,000 in 2009. Medicare and Medicaid reimbursement would help the center recover some of the costs, but not all of them, Jepson said.

Although a state bill to regulate the rates of the free-standing centers has bipartisan support in the legislature — the House version has 24 sponsors — the Maryland Health Care Commission, which wants to require the facilities to obtain a certificate of need, opposes the measure. Officials with the commission fear it opens the doors to similar facilities, which they say are not cost-effective. The bill has had a first reading in committee.

Officials said the legislature approved the free-standing emergency centers at Germantown in 2005 and in Grasonville in 2007 against the recommendation of the commission. The Germantown center opened in 2006, and the University of Maryland Medical System's Queen Anne's Emergency Center is scheduled to open later this year.

"We're facing a real dilemma here," said Dr. Rex Cowdry, executive director of the Maryland Health Care Commission.

The stand-alone emergency centers are a "very expensive" way to provide health care, and the commission's analysis has shown that the patients being treated at the Germantown center are more often not emergency cases when compared to cases at other hospital emergency rooms, Cowdry said.

Pamela Barclay, director of the commission's Center for Hospital Services, said it costs roughly 10 times more to treat patients at a center than if they were seen by a primary-care physician.

In addition, a proliferation of the centers would siphon patients from existing hospitals and hurt their economic viability, she said.

"We tend to think there's benefit to having a thoughtful planning process, both from a cost standpoint and because you don't want to negatively impact hospital emergency departments in other parts of the state," she said.

Barclay testified before the House Health and Government Operations Committee on Feb. 25 that while the Germantown emergency center sees a large number of patients, only 5 percent of the visits result in hospital-inpatient care. That figure compares with 16 percent for Shady Grove Adventist Hospital's emergency room in Rockville and 19 percent for emergency rooms statewide.

The Germantown center also had a higher percentage of patients, 45 percent, who were deemed as not needing emergency-room care compared with the state average of 40 percent, Barclay said.

One reason the relatively high percentage of those seen are not hospitalized or considered emergency cases is because the upper part of the county has a lot of relatively healthy young families with children, Jepson said.

The Shady Grove Adventist Emergency Center at Germantown treated 36,000 patients in 2009 for everything from broken bones to chest pains, he said.

In a letter in support of the bill, Montgomery County Fire and Rescue Services Chief Richard R. Bowers wrote that the Germantown center provides emergency care "effectively and in a cost-efficient manner," which has improved access to emergency health-care for residents in upper Montgomery County.

Delegates and senators from Montgomery County and from Queen Anne's County testified the free-standing centers provide a vital niche to make sure patients can get emergency treatment quickly.

"Could these two be grandfathered in and then require certificates of need [from other facilities] in the future?" asked Del. Kirill Reznik (D-Dist. 39) of Germantown, a sponsor of the bill.

"This is a life and death matter to us," said Sen. E.J. Pipkin (R-Dist. 36) of Stevensville, who supports the measure.

On the Eastern Shore, an ambulance could be out of service for more than two hours because of the length of time it takes to travel to a hospital with an emergency room and back, Pipkin said.

But Cowdry said providing rate regulation for the facilities might encourage other hospitals to seek free-standing emergency centers in the future. "What do we do, and how do we keep them from proliferating?" Cowdrey asked.