PHA concerned over negative impact on patient care by Section 6001 of Healthcare Reform

Section 6001 Jeopardizes Hospital Projects That Would Serve Approximately 300,000 Patients

Physician Hospitals of America (PHA) is deeply concerned about the negative impact on patient care caused by Section 6001 of Healthcare Reform which prohibits new construction or expansion of physician owned hospitals (POHs). Since its passage, section 6001 has prevented or impeded progress for 37 new hospitals, more than 40 nearly-finished hospital construction projects, and approximately 20 major expansion projects.

These facilities would provide care for approximately 300,000 patients.   With 30 million additional patients entering the insurance rolls, this country needs more high-performing hospitals – not fewer.  

Many of these projects were planned for parts of the country with a desperate need for patient care.  "The main reason we started our POH is that the local hospital decided to consolidate its cardiac services 120 miles away," says Dr. Sean Denney, a cardiologist and POH partner at Kearney Regional Medical Center in Nebraska.  "That is simply too far for such a crucial and time-sensitive specialty." 

In both rural and inner city areas, physicians have been investors of last resort in an effort to rescue needed hospitals.  In Pontiac, Michigan, doctors worked with the city government to rescue a bankrupt hospital.  It would not have reopened if the doctors had not have invested.  This is also true of an inner city hospital in Houston, as well as rural hospitals in Alabama and Tennessee.  Physician ownership generally improves quality of care as has already been documented in both public and private studies.

"President Obama has publically said that 'consumers do better when there is choice and competition,' and we agree," says PHA President Dr. Michael Russell.  "What is the point of requiring Americans to have insurance and then taking away their choice and access to care?"

There are currently 275 POHs treating approximately 1.5 million patients each year in 34 states.  These hospitals include general acute care, long term acute care (LTAC), emergency medicine, multispecialty, women's, children's, rehabilitation and psychiatric.    According to the government's HCAHPS survey data, physician owned hospitals rank first for quality in 19 states.