Doctor-Owned Hospitals Nabbing Bonuses Under ACA’s Quality Programs
Despite provisions in the Affordable Care Act that discourage their growth, physician-owned hospitals have been receiving some of the largest bonuses under the ACA's new quality programs, Kaiser Health News/Washington Post reports.
In response to concerns that such physician-owned hospitals cherry pick the best insured and most lucrative patients, the ACA sought to inhibit the growth of such facilities by prohibiting new construction or expansion, except under limited circumstances.
There are about 260 physician-owned hospitals across 33 states, with many in Kansas, Louisiana, Oklahoma and Texas. Of those, 122 are receiving rewards under the ACA's quality programs and 39 are being penalized. In comparison, 74% of other types of hospitals are being penalized under the program.
Meanwhile, nine of the 10 hospitals receiving the largest bonuses under the law are physician-owned. Further, physician-owned hospitals are receiving an average bonus of 0.21% per Medicare beneficiary they treat this fiscal year, while other hospitals are being penalized an average of 0.30% per beneficiary.
Physician-owned hospitals might be faring better under the ACA's quality programs because they have lower readmission rates because many do not accept heart failure or heart attack cases, which Medicare uses to calculate the rewards and penalties.
In addition, physician-owned hospitals often treat fewer low-income individuals, who typically have a harder time purchasing medications, pursuing follow-up appointments and finding help during their recuperation. Further, many patients at physician-owned facilities are undergoing elective surgeries instead of being treated for emergencies.
Ashish Jha, a professor at the Harvard School of Public Health, said, "Providing extra rewards for hospitals that treat the healthiest, wealthiest patients just seems unfair."
However, executives at physician-owned hospitals have said they deserve the additional payments.
Robb Linafelter, CEO of Lincoln Surgical Hospital in Nebraska, said that because physicians own the hospital, they decide where resources are best used to help patients. "At a community hospital, doctors don't have control over where the dollars are spent" (Rau, Kaiser Health News/Washington Post, 4/13).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.