Ohio hospital dumps doctors who invest in for-profit rival

A nonprofit health system makes the decision to revoke privileges for physicians involved in financing a competing facility.

By Cheryl Jackson, AMNews staff. Aug. 12, 2002.

If doctors want to open competing hospitals, then existing facilities have a right to strike them from their staffs, one Ohio hospital says.

The board of directors at OhioHealth, a nonprofit health system based in Columbus, Ohio, voted in July to remove from the staffs of its hospitals physicians who invest in competing for-profit facilities.

The decision was OhioHealth's response to 28 doctors investing in the nearby $38 million New Albany Surgical Hospital.

The move is preemptive to discourage other for-profit facilities, a hospital spokesman said. It takes effect in October.

OhioHealth operates three of Columbus' six hospitals.

Similar scenes might play out across the United States as more physicians invest in facilities while hospitals cry foul, alleging that the new competitors take away the most profitable business and put them in jeopardy of closing.

Ohio has seen an increase in the number of private, often physician-owned ambulatory surgery centers and hospitals, following the demise of its state review and approval process for new facilities.

Ironically, it was the hospital community that led the charge to get rid of the certificate-of-need process, hoping it would allow for easier building and expansions. But private companies were able to use a more lenient process to open new shops.

Nonprofit hospitals now say the competition takes money from them while leaving them responsible for money-losing services such as emergency departments.

The Columbus area has no tax-supported county hospital, so charity and indigent care is provided by a network of nonprofit hospitals. [...]