Congress extends moratorium on specialty hospitals again
An important bill extending a moratorium on specialty hospitals has just passed Congress, the impact of which is wider than most realize. The battle between not-for-profit, general-care hospitals and for-profit hospitals that specialize in just a few high-profit procedures lies at the heart of the debate.
As background, the Stark Act prohibits physicians from referring Medicare or Medicaid patients to another entity if the referring physician has an ownership interest in the entity. Any referral of patients to a “specialty hospital” by a physician owner of the hospital would implicate the Stark Act because the referral of patients to the hospital will be for inpatient and outpatient hospital services.
Congress felt there was a problem with this ban, though, and made physician self-referrals exempt from these referrals under the “whole-hospital exception”. This caused about 100 specialty hospitals to spring up nationwide during the ’90s, including many in Indiana. But in December 2003 Congress placed a moratorium on physicians referring to any new specialty hospitals.
Now Congress has once again extended the moratorium, a move which significantly affects hospitals across the state. S. 1932 passed in the Senate yesterday by a vote of 51-50 (with Cheney casting the deciding vote), following the House’s passage on Monday with a vote of 212-206.
