Another oldie, from April/11.

What effect does the ownership of medical facilities by  physicians  have on the quality of health care and on prices?  My great uncle was the only physician in a small town in Oklahoma for many years and his home doubled as his living quarters(upstairs) and as the town hospital(downstairs).  Eventually he built a hospital away from his residence and I have subsequently learned that this was the situation in most of rural Oklahoma. Indeed, if it weren’t for the willingness of physicians to take this risk, there would have been no hospitals in these small communities.  My great uncle was never able to wash his hands of the care rendered to patients in his facility, saying, “well…I did my part, but the folks in the hospital messed up.”  He was accountable for not only the care he rendered but of that given his patients by everyone in his hospital.  He was also not able to say,”I can’t do anything about that bill…that’s the hospital…my fees are fair.”  The patients knew that it was his hospital and that he could charge whatever he wanted and that whatever they were charged it was his decision and certainly his responsibility.  He was also not able to say,”I don’t know why the credentials committee gave that incompetent butcher privileges.”  He was in control of who he worked with and who was allowed to work in his hospital.  Indeed, the poor practice of medicine by anyone in his facility was a reflection on him.

Little has changed.  Physician facility owners are accountable to their patients on more levels than physicians that are not facility owners.  Multiple levels of accountability to the patients we serve makes the likelihood of high quality care, fair pricing and regular policing of all those working at the facility a natural occurrence.

You say, “Yeah, but doctors who own their own facilities are going to churn and overutilize to pad their pockets!”  Physicians who act in this manner are everywhere, but are less likely to be found in a physician-owned facility because their reputations (and that of every physician working in the facility) are on the line.  If a surgeon is going to perform unnecessary surgery he is more likely to get away with that in a facility where he has no interest in the long term success of the facility and where his actions don’t affect the reputation of his colleagues.  And for those of you who object to physician ownership, how is it that no conflict of interest exists when hospitals own doctors but one supposedly does when doctors own hospitals?

G. Keith Smith, M.D.