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December 8, 2015



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Groups Urge Congress to Support Physician Owned Hospitals

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Groups Urge Congress to Support Physician Owned Hospitals

When passed, the Affordable Care Act (ACA) included a provision that banned any new physician-owned hospitals from being built as well as banning the expansion of existing hospitals. The American Hospital Association (AHA) continues to push back against recent legislation introduced that would lift the moratoria on expansion for these specialty hospitals. They argue that these hospitals “cherry pick” patients or limit themselves to the most lucrative types of procedures and operations. A recent independent study published by the British Medical Journal (BMJ) disputes these claims. In fact, lead author Daniel Blumenthal, MD, a clinical fellow at Massachusetts General Hospital said, “By and large, physician-owned hospitals have virtually identical proportions of Medicaid patients and racial minorities and perform very similar to other hospitals in terms of quality of care.”  The authors also conclude that physician owned hospitals are not providing lower-value care or threatening the financial viability of surrounding hospitals

Indeed, physician-owned hospitals consistently rank higher under current law quality measures, like the Hospital Value Based Purchasing Program, compared to other hospitals. The moratoria puts physician-owned hospitals at a disadvantage and undermines the premise of the ACA by limiting access to care. There is a demand for these hospitals in the healthcare system, and this provision only penalizes patients who should have the right to receive care at the hospital of their choice.

Recently, a group of over 40 specialty societies and state medical societies sent a letter to congress urging support for H.R. 2513, the Protecting Access, Competition and Equity Act, which simply asks that the moratoria on expansion be suspended for approximately 3 years. The moratoria would not be re-imposed if the hospital has achieved a hospital star rating of 3 or more for 12 consecutive quarters. Read the letter online here.

“The inability of physician-owned hospitals to address the growing demand for high quality health care services in their community is bad for our entire health care system and does nothing but penalize patients who should have the right to receive care at the hospital of their choice,” the letter states. “Physician-owned hospitals have injected much-needed competition into the hospital market, forcing traditional hospitals to improve and innovate. This is a win-win for patients and for the entire health care system as we work to improve care.  Physician ownership is driving higher quality and improved outcomes for patients, as demonstrated in the results of the new Value Based Purchasing and hospital star rating programs, among others. We urge Congress to put patients first and support H.R. 2513 to ensure greater access to high quality, physician-owned hospitals.”