Under the new health care reform law, physician-owned hospitals face limitations. According to Investors.com, a physician-owned hospital that seeks to expand must, among other things, apply to the U.S. Department of Health and Human Services only once every two years, and it must wait for a period of time for community input. Additionally, the hospital’s bed occupancy rate can’t exceed the state average.
Opponents of physician-owned hospitals say that doctors may base medical decisions on how much money they’ll make and that such facilities create conflict of interest issues that could put patients in danger.
The Physician Hospitals of America (PHA) and Texas Spine & Joint Hospital (TSJH) filed suit in federal court (press release in PDF) to challenge the new health care reform law. An excerpt:
Section 6001 applies only to hospitals owned by physicians and does not impact any other type of hospital. PHA and TSJH believe Section 6001 is exclusionary and unconstitutional, eliminates competition for non-physician owned hospitals, and will ultimately have a negative impact on patient choice and medical care affordability. Section 6001 is retroactive, arbitrary, vague, contradictory, and fails to provide due process and equal protection.
Accompanying the lawsuit is a motion for a preliminary injunction that would allow TSJH to proceed with plans to expand its facility, which has already won local zoning approval for an additional 20 Medicare beds.
According to the Dallas Morning News, Dallas-Forth Worth has more physician-owned hospitals than any other metro area. About 9.7 percent of the country’s physician-owned hospitals are in the area, and Texas itself has the highest rate in the country.
