Medicare Payment Advisory Commission seems poised to recommend
that Congress get rid of a big loophole in the laws that
prevent physicians from sending their patients to facilities
in which they have a financial interest.
"whole hospital" exception was based on the theory
that a single physician could not possibly refer enough
patients to significantly affect the profitability of his
or her interest in an entire general hospital, but it has
had the unforeseen consequence of facilitating the rise
of physician-owned "specialty" hospitals that
focus on a single area such as coronary procedures or orthopedics.
describe these facilities as "focused factories"
that provide more cost-effective care for patients and a
better environment for physicians, but critics say specialty
hospitals skim the most profitable patients from struggling
general hospitals. The Medicare Modernization Act placed
an 18-month moratorium on the development of new physician-owned