TMA Supports Physician Hospital Ownership

Federal law should not interfere with physician ownership of hospitals because physician-owned hospitals provide a significant contribution and studies show their exceptional quality results in a ranking at the top in patient satisfaction, TMA has told a federal court.

"Economically, these hospitals pay billions in salaries, hundreds of millions in taxes, provide charity care, and provide services in underserved or abandoned areas," TMA says in a legal brief [PDF] that supports a lawsuit seeking to overturn the portion of the new health system reform law that restricts physician ownership. The TMA Board of Trustees authorized filing of the brief to throw the association's weight behind a federal lawsuit against Health and Human Services Secretary Kathleen Sebelius by Physician Hospitals of America and Texas Spine & Joint Hospital, Ltd. The lawsuit seeks to overturn Section 6001 of the Patient Protection and Affordable Care Act.

"Physician hospitals have endured bullying by their non-physician-owned competitors for years," the brief says.

"Unfortunately, under pressure from non-physician-owned hospital giants, the government has impermissibly banned the future development of physician-owned hospitals. There is no justification for targeting the class of physicians in this way. No other class of professionals is discriminated against in this way."

The brief notes that:

  • Studies show physician hospitals have better health care outcomes, shorter hospital stays, and much higher patient satisfaction ratings than do non-physician owned hospitals.
  • In Texas alone, physician-owned hospitals employed 22,740 people and paid $1,121,570,000 in salaries in 2009.
  • Physician-owned hospitals in this country paid $671,350,300 in taxes last year.
  • In many cases, physician hospitals provide more charity care than not-for-profit hospitals. Nationally, physician-owned hospitals provide, on average, approximately 6.2-percent charity care.
  • Non-physician-owned hospitals have used numerous tactics to squeeze out the competition of physician-owned hospitals in order to preserve their bottom line.


Action, Sept. 14, 2010

Last Updated On

May 12, 2016