Specialty Hospitals put community health care at risk

AORN Journal,  June, 2005  

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The opening of physician-owned, limited-service (ie, specialty) hospitals has Led to increased costs in health care services, forced cutbacks in services at other hospitals, and placed access to emergency and trauma services at risk, according to a Feb 16, 2005, news release from the American Hospital Association (AHA). Specialty hospitals typically focus on financially rewarding services, such as orthopedics or cardiac care, and depend on physician-owners to refer their own patients.

Previous government reports have found that specialty hospitals remove Lucrative services from full-service hospitals, treat healthier patients, treat fewer patients with low incomes, and rarely have emergency departments that are open 24 hours a day, seven days a week. These strategies can lead to operating margins as high as 44%, versus the average operating margin of 3.3% for a community hospital.

A recent study sponsored by the AHA and several state hospital associations reinforces these findings. The study found that when physician-owners shift selected patients and services to limited-service hospitals, access to a variety of critical health services is put at risk for the broader community. Lost revenues force cutbacks in essential programs, such as behavioral health care, outpatient clinics for patients with low incomes, and health education, and prevent investment in new programs and technology. The study's findings have led the AHA to call for Congress to permanently ban physician self-referral to limited-service hospitals.

Health Services for Broader Community Put at Risk by "Specialty" Hospitals: Report (news release, Washington, DC: American Hospital Association, Feb 16, 2005).

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