Printer-friendly format

Donna F. Landry

Owning a piece of a limited-service, or specialty hospital, can change the way doctors practice medicine, resulting in a dramatic rise in high-cost surgeries and procedures, according to a recent Georgetown University study.

The study's results came as little surprise to community, or full-service, hospitals in the Acadiana area. Lafayette is home to four specialty hospitals, two of which opened in 2004.

"Our Lady of Lourdes has experienced a decrease in patient volume over the past two years. Some of it undoubtedly can be attributed to the limited service hospitals," said Berch Stelly, a spokesman for Our Lady of Lourdes Regional Medical Center.

Stelly said the hospital is also doing fewer surgical procedures because of the limited-service hospitals.

But move over to the Lafayette General Medical Center campus and the picture is quite different. Chief Operating Officer Donna F. Landry said specialty hospitals have had little impact on the community hospital, and Lafayette General Surgical Hospital, the hospital's joint venture with 11 surgeons, is proving the benefits of a collaborative approach.

In the last year, Lafayette General has also set up partnerships with 42 doctors in an imaging center and seven doctors in a neurosurgical center of excellence.

Lafayette General and its doctors/partners want to deliver quality healthcare to the community, Landry said. Both are working to provide it.

Mark Eldredge, vice president-business development at Heart Hospital of Lafayette, said the Georgetown study is flawed. Among other things, the study included data from only one workers' compensation carrier, which didn't represent the entire market; looked at only a handful of procedures whose use has been increasing regardless of specialty hospitals; and contradicts findings from a recent, more comprehensive Government Accountability Office study. In Eldredge's experience, a single physician's ownership interest in a specialty hospital is small; typically around 2 percent. Potential return on investment is very low compared to a physician's professional fees earned regardless of where he or she practices.

According to Eldredge, refuting specifies of the study is only half the story. He said physicians refer to hospitals in which they invest because there is a much higher degree of control over clinical quality, and feel their patients will receive better care. Physicians at Heart Hospital of Lafayette, for example, are proactively implementing new prospective review protocols to ensure that cath lab and open heart surgery cases meet established clinical criteria for medical necessity. Physician-driven hospitals, he said, are in a much better position to implement this type of control, which ultimately benefits both patients and payers.

The state and national hospital associations say that physician-owned hospitals add to community hospitals' burdens by targeting the more lucrative surgical procedures and best-insured patients.

Lourdes has been one of the hospitals hardest hit by physician-owned facilities.

Stelly said Lourdes has slashed the equivalent of 375 full-time positions during the past two and a half years. Of the total, less than 100 came as a result of layoffs.

Most resulted from the hospital managing and monitoring attrition in areas that don't deal directly with patients, Stelly said. Some vacant positions were not filled; some workers were not replaced when they left.

Despite the limited-service facilities' impact, Our Lady of Lourdes remains neutral on the subject of a federal ban on physician self-referrals to new limited-service facilities.

The moratorium ends June 8. Both the state and national hospital associations favor extending the ban.

LHA president John A. Matessino said the prohibition should remain in place while Congress completes studies on the issue and analyzes the results.

A number of government studies, he said, as well as those funded by the AHA, have raised questions about physician-owned hospitals. Those studies show physician-owned hospitals pick and choose the services they provide, and the patients who receive them, Matessino said.

For instance, the Government Accounting Office found that physician-owned facilities treated patients that were less sick and provided less uncompensated care. The Medicare Payment Advisory Commission found that physician-owners concentrate on the more profitable disagnoses and procedures, cardiac care, orthopedic surgery and other surgical procedures.

The most recent study by Georgetown University looked at doctor-owned orthopedic and spine hospitals in Tulsa and Oklahoma City. The study found that the number of complex spinal fusion surgeries was nearly five times higher in Oklahoma City in 2004 than in 1999, when the Oklahoma City specialty hospital opened. In Tulsa, there were 21 times as many in 2004 compared to 2000, 65 cases versus three.

There were also substantial percentage increases in the number of epidurals and knee surgeries, the study showed.

These findings support earlier studies that show physician self-referral arrangements result in more medical procedures and increased costs to third-party insurers, the study said.

Not surprisingly, the Louisiana Association of Focused Care Facilities disagrees with the study. The association says that specialty hospitals will reduce costs by lowering overhead and increasing efficiency by focusing on one area.

Eldredge said he's frustrated by the criticism that focused-care facilities receive.

Those assessments, which include cherry picking patients and dumping the sicker patients on community hospitals, aren't true at many of the specialty hospitals, including Heart Hospital. Heart Hospital, a joint venture between MedCath Corp. and local physicians, has an emergency room, which is open 24 hours a day, seven days a week.

Heart Hospital has the same mix of patients as a nonprofit, community hospital, Eldredge said. But unlike those hospitals, focused-care facilities pay property and sales taxes.

The Centers for Medicare & Medicaid Services found that specialty hospitals devoted a much larger share of their revenues to uncompensated care and taxes than community hospitals did to uncompensated care.

The patients and everyone else likes the focused-care approach, Eldredge said. Only community hospitals dislike it.

Tags:

None

Do you know someone else who would like to see this?
Your Email:
Their Email:
Comment:	(Will be included with e-mail)
Secret Code	In the box below, enter the Secret Code exactly as it appears above *