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Study: Physician Owners Add to Health Costs, Usage
Physician-owned limited-service hospitals drive up utilization and health care costs, according to two new studies released today, lending support to an Ohio Hospital Association quest for federal legislation.
Jean M. Mitchell, Ph.D., an economist at Georgetown University, released studies of physician-owned limited-service spine and orthopedic hospitals in Oklahoma and cardiac hospitals in Arizona, which suggest the financial incentives linked to ownership caused physician owners to change their practice patterns, shift more profitable procedures to facilities they own, and cherry-pick low severity cases and patients with generous insurance coverage.
Mitchell also concluded a proliferation of physician-owned limited-service hospitals is more likely in states lacking certificate of need (CON) law, which requires hospitals to show a need for a new facility or service. Ohio repealed its CON law in 1995.
The studies lend support to the OHA’s Board-adopted position that Congress should make permanent a federal moratorium on new physician-owned limited-service hospitals. An 18-month moratorium is set to expire June 8, 2005. OHA anticipates the introduction of federal legislation and possible congressional hearings on the issue soon.
Mitchell’s analyses in Oklahoma are based on more than 250,000 workers’ compensation claims for treatment at full-service community hospitals, limited-service hospitals, physician-owned ambulatory surgery centers and non-physician-owned ambulatory surgery centers. The Arizona study is based on six years of hospital inpatient discharge data and physician directory information from the Arizona Medical Board.
More information, including copies of the studies, is available from the Coalition of Full Service Community Hospitals’ Web site at www.fullservicehospitals.org/.
The Ohio Hospital Association was established in 1915 and currently represents 170 hospitals and 40 health systems throughout Ohio. OHA is a membership-driven organization that provides proactive leadership to create an environment in which Ohio hospitals are successful in serving their communities. Visit OHA’s Web site at www.ohanet.org. For information on top health care issues, visit the online OHA News Media Center at www.ohanet.org/media/.
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