Ending the Ban on Physician Owned Hospitals

In March of 2010, Title VI of the Affordable Care Act effectively prohibited new development or expansion of existing Physician Owned Hospitals (POH). This stifled a thriving healthcare segment that had a 3-4-fold increase over the preceding decade. Shortly thereafter Centers for Medicare and Medicaid Services (CMS) began its Hospital Value Based Purchasing Program. CMS began rewarding acute care hospitals with incentive payments for quality care. Parameters measured include patient safety, patient experience, clinical care, efficiency and cost reduction. Direct comparison of hospitals became more readily available to the public.

Those advocating a cessation of POH based on quality and cost have over time been proven wrong. Although POH comprise only 5% of the total nationwide hospital network, POH routinely outperform their competition. 7 of the 10 highest scoring hospitals per CMS are physician owned. 40% of POH received Medicare’s coveted 5-star rating, compared to only 5% of general hospitals. And, according to Avalon Health Economics, POH have saved CMS $3.2 billion over ten years.

While small business owners deal with increasing healthcare premiums, and patients struggle with increasing healthcare deductibles, it is vital that low cost high quality healthcare become widely available. POH encourage local physicians to remain at the forefront of healthcare delivery. Having physicians engaged in the total patient experience and focused on guiding their patients through a complicated healthcare delivery system is an asset to any community. Article VI of the Affordable Care Act runs contrary to the law’s laudable goals of access to quality care for all and should be repealed.

Safa Farzin M.D.

Dr. Farzin is a practicing Intensivist in Harrisburg, PA and Chief Executive of the Medical Group of Pennsylvania, Central PA’s largest Independent Physician Association. To learn more about the Medical Group of PA, visit us at MedGroupPA.com.