Debate over specialty hospitals will continue

"The battle over so-called specialty hospitals is set to make headlines again" because of a recent CMS decision, a Washington Times editorial states (Washington Times, 8/31).

Earlier this month, CMS decided not to extend a moratorium on approval of new specialty hospitals.

As a result, new specialty hospitals are planned in California, Indiana, Pennsylvania and Texas, where about one-third of the 130 specialty hospitals in the U.S. are located. James Grant, executive vice president of Chicago-based National Surgical Hospitals, said that he expects the construction of almost 30 new specialty hospitals within the next year (Kaiser Daily Health Policy Report, 8/29).

Supporters of specialty hospitals "contend that specialization improves both the efficiency and the quality of care," while critics "argue that they siphon away the most lucrative, cost-offsetting patients upon whom community hospitals depend to stay afloat," the editorial states.

Others, including the American Hospital Association, also express concern that physicians "with ownership stakes inevitably face conflicts between optimal care and optimal profit," the editorial adds.

According to the editorial, the debate will continue, but, "for now, specialty hospitals will have at least a few months and probably longer to grow in numbers and prove themselves."

It concludes, "Their success would show that health care is not so radically distinct a segment of the economy that the normal laws of economics must be nullified completely" (Washington Times, 8/31).