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The State of Play

Again, there are political efforts to limit and restrict physician hospitals (and completely stop their growth and expansion) by denying Medicare patients access to these quality facilities as a part of health care reform. The economic costs of such restrictions are quite large. According to a recent Health Economics Consulting Group study, the physician hospitals now in operation pay $2,694,329,910 in payroll to some 60,000 employees, and pay $605,103,045 in taxes. The physician hospitals under development at a cost of $2,033,698,862 will put another 25,707 employees to work. As the CMS found in its 2005 study, physician hospitals provide a net community benefit almost 8 times higher than hospitals not owned and operated by physicians.

To strangle these important economic assets, at a time when we continue to struggle with a deep recession and sky-high unemployment, would be foolish beyond belief. More importantly, those same misguided politicians seem all too willing to sacrifice the high quality care provided by physician hospitals to supposedly save a health care buck. Unfortunately, the perceived short term savings may well cost you your life.

As part of the 2003 Medicare Modernization Act, Congress passed a moratorium on Medicare payments to physician hospitals. That moratorium expired in 2006. Since then, these types of facilities have flourished, becoming the best hospital facilities in a large number of states. Now, some politicians are willing to aid and abet the big chain and community hospital industry in their effort to once again squash the competition by reinstating the ban on physician-owned hospitals.

All types of hospitals agree that participation with Medicare is vital to success. Efforts to ban Medicare payments to physician-owned hospitals don't serve patients well, expand quality care, or even save money in the long run. Our population is aging, and innovation in all sectors of the health care community is prolonging a better quality of life. Keeping patients healthy is ultimately the best way to lower our nation’s health care bill. America needs physician-owned hospitals to provide better, cleaner, safer care to millions of seniors, as well as to provide much-needed competition for many of the thousands of bigger hospitals now trying to ban their very existence.

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