Draft Bill Threatens Existence of Physician-Owned Hospitals

Sandvig cited five areas in the House draft bill that would damage physician-owned hospitals:

• Existing hospitals would not be forced to "buy-down" physician ownership but would rather be able to remain at the aggregate percentage of physician ownership that they had as of date of enactment.
• The majority of existing hospitals would not be allowed to grow or expand in any way. Provisions allowing expansion based upon very stringent and limiting requirements are included in the bill, but according to PHA calculations, would only allow nine physician hospitals in the country to apply to HHS for the right to grow.
• All under development hospitals that did not have a Medicare Certification number by Jan.1, 2009, would not be grandfathered. In other words, they would not be allowed to continue to take Medicare and Medicaid patients if the physicians who own the hospital continue to refer to that hospital.
• The whole hospital exemption to Stark laws would not apply for any hospitals not in existence as of Jan. 1, 2009. This would not allow a physician to refer a Medicare/Medicaid patient to a hospital in which he or she owns an interest, and thus, severely restrict the future growth of physician owned hospitals.