government

House bills would lift ban on physician-owned hospitals

The legislation would reverse a provision in the health reform law that effectively prohibits new doctor-owned hospitals from forming and stops existing facilities from expanding.

By — Posted March 31, 2011

Print  |   Email  |   Respond  |   Reprints  |   Like Facebook  |   Share Twitter  |   Tweet Linkedin

House lawmakers have introduced two pieces of legislation that would rescind a provision in the health system reform statute designed to stop the spread of physician-owned hospitals.

Separate bills introduced by Reps. Doc Hastings (R, Wash.) and Sam Johnson (R, Texas) would repeal Section 6001 of the Patient Protection and Affordable Care Act. The provision barred new physician-owned hospitals from obtaining Medicare certification starting Jan. 1, and it placed strict limits on existing hospitals that seek to expand their footprints or take on new physician investors beyond where they were at the time of the law's enactment.

Physician hospital advocates said the move was crippling to an industry that provides high-quality, specialized care to millions of patients. Physician Hospitals of America, which represents many of the facilities, said the issue goes beyond the 275 doctor-owned hospitals that are in operation.

"Much-needed expansion projects were halted at over 30 existing hospitals, and more than 40 hospitals are in a state of uncertainty because they were not certified by Medicare in time to meet the [Dec. 31, 2010,] deadline," said PHA president Michael E. Russell II, MD. He's an orthopedic spine surgeon at Texas Spine & Joint Hospital, a wholly physician-owned orthopedic care facility in eastern Texas. "Passage of this legislation would undo the harm to communities imposed by the current law, help improve access to quality health care services, preserve the right of patients to choose where they receive their health care and protect much-needed jobs during our down economy."

The American Medical Association and other medical organizations support physician ownership of hospitals and are backing efforts to repeal the ban in the reform law. They say doctor-owned hospitals introduce healthy competition to the marketplace, increase high-quality care choices for patients and give physicians an alternative to more traditional hospital employment arrangements. Advocates of the hospitals note that the reform language targeted not just specialty hospitals, but also multispecialty hospitals, acute care facilities and even some community hospitals being supported by physician investors.

But community hospital backers, such as the American Hospital Assn., say the doctor-owned facilities pose a threat by siphoning off more profitable patients and straining the wide range of vital services provided by the larger community facilities. They also stress an inherent conflict of interest whenever a physician owner refers a patient for treatment at a hospital in which he or she has a financial interest.

The Hastings bill, which at this article's deadline had a bipartisan list of 10 co-sponsors, also would repeal reform law language requiring drug and device makers to report all payments they make to physicians as well as to disclose any physician ownership in their firms.

Back to top


ADVERTISEMENT

ADVERTISE HERE


Featured
Read story

Confronting bias against obese patients

Medical educators are starting to raise awareness about how weight-related stigma can impair patient-physician communication and the treatment of obesity. Read story


Read story

Goodbye

American Medical News is ceasing publication after 55 years of serving physicians by keeping them informed of their rapidly changing profession. Read story


Read story

Policing medical practice employees after work

Doctors can try to regulate staff actions outside the office, but they must watch what they try to stamp out and how they do it. Read story


Read story

Diabetes prevention: Set on a course for lifestyle change

The YMCA's evidence-based program is helping prediabetic patients eat right, get active and lose weight. Read story


Read story

Medicaid's muddled preventive care picture

The health system reform law promises no-cost coverage of a lengthy list of screenings and other prevention services, but some beneficiaries still might miss out. Read story


Read story

How to get tax breaks for your medical practice

Federal, state and local governments offer doctors incentives because practices are recognized as economic engines. But physicians must know how and where to find them. Read story


Read story

Advance pay ACOs: A down payment on Medicare's future

Accountable care organizations that pay doctors up-front bring practice improvements, but it's unclear yet if program actuaries will see a return on investment. Read story


Read story

Physician liability: Your team, your legal risk

When health care team members drop the ball, it's often doctors who end up in court. How can physicians improve such care and avoid risks? Read story