Medicare wants to restrict doctors from
referring patients to specialized hospitals owned by the
physicians, a necessary step to prevent fraud, regulators say.
The agency that runs Medicare will propose a rule in July
that would limit doctors’ ownership in hospitals that specialize
in treating one disease, according to an agenda in the Federal
Register. The rule may affect 10 hospitals run by MedCath Corp.,
which specializes in heart disease, and another 82 owned by
doctors and individual investors.
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On average, doctors own almost a third of each heart
hospital, such as those owned by Charlotte-based MedCath, and
about 70 percent of each specialty surgical facility. That’s drawn
criticism from general hospital chains, including HCA Inc., who
say physicians are steering profitable surgeries and other
business to specialty chains that they own. Medicare may not have
the authority to enforce its plan, a lawyer said.
“They’re in essence redefining a hospital for this purpose,
and I wonder whether that’s proper,” said Larry Oday, an attorney
with the Washington office of Vinson & Elkins who follows Medicare
regulations.
Medicare officials wrote anti-fraud rules that bar physicians
from referring patients to clinics or lines of service in which
the doctors own an interest. The agency is proposing to revise
rules to limit ownership in entire hospitals.
Some lawmakers have already supported limiting doctors’
investments in specialty hospitals. House Ways and Means Committee
Chairman Bill Thomas, a California Republican, said two weeks ago
that such hospitals should get lower Medicare payments than
general acute-care hospitals.
Medicare is the U.S. health insurance program for the elderly
and disabled. About 55 percent of MedCath’s hospital division
revenue comes from Medicare, according to the company.
Bloomberg News
