The AMA is a strong proponent of lifting bans on physician-owned hospitals. A newly introduced bipartisan bill, the Physician Led and Rural Access to Quality Care Act (H.R. 9001), works to achieve that goal, permitting the establishment of select physician-owned hospitals that meet certain criteria.
Introduced by Reps. Michael Burgess, MD (R-Texas), Tony Cardenas (D-Calif.), Morgan Griffith (R-Va.), and Vicente Gonzalez (D-Texas), the bill seeks to improve access to care in rural areas through the expansion of existing physician-owned hospitals.
“Having owned my own practice, I understand the critical importance of affordable health care prices and timely access to high-quality care,” Dr. Burgess, who practiced ob-gyn medicine for nearly three decades, said in a statement. “I am honored to lead this bipartisan legislation with my fellow members to ensure that rural patients across America receive the care they need.”
Physician-owned hospitals grew rapidly from less than 70 nationwide in the early 2000s to roughly 250 by 2010. That growth was spurred by demand for general acute care hospitals in some markets and opportunities to boost clinical operations and surgical procedures through facility specialization.
Expansions stopped in 2010 with the passage of the Affordable Care Act (ACA), which after intense lobbying by hospital trade groups included a provision that effectively banned the expansion of existing physician-owned hospitals and prevented any new doctor-owned hospitals from opening.
Help for rural areas
H.R. 9001 doesn’t repeal the ACA ban. Instead, it proposes smaller changes, creating a narrow exemption for new physician-owned hospitals that meet specific criteria.
The bill defines a “covered rural hospital” as a physician-owned hospital located in a rural area and more than a 35-mile drive—or a 15-mile drive in mountainous terrain or areas with only secondary roads—from another hospital or critical access hospital. Hospitals that meet this narrow definition would be able to move forward as a new hospital under physician ownership and once meeting this definition, they would be able to expand.
The AMA strongly supports the bipartisan legislation.
"With consolidation on the rise in all areas of health care leading to higher costs, it's crucial that Congress pursue policy solutions to increase competition, especially among hospitals,” said AMA President Bruce A. Scott, MD.
Dr. Scott applauded the lawmakers for issuing a bipartisan, commonsense solution to pave the way for some new physician-owned hospitals.
“This balanced approach will undoubtedly usher in high-quality health care across the country, especially in rural areas,” he said.
The hope is that H.R. 9001 will move with a larger health care bill at the end of the year. Despite its narrow scope, it is expected that the hospital lobby will continue to oppose the legislation. The AMA also continues to support H.R. 977, the Patient Access to Higher Quality Health Care Act, which completely removes the ban on newly constructed or expanded physician-owned hospitals. That legislation is led by Dr. Burgess and Texas Democratic Rep. Henry Cuellar.
