- Competition does not hurt general hospitals. This fact is more than evident even if looking only at the national growth of the healthcare industry. For instance, on January
3rd, 2006, USA Today reported that the industry is "in the middle of the biggest hospital construction boom" in more than 50 years. And on November 7th, 2005, Modern
Healthcare reported that the hospital industry's profits "rose to an all-time record and its net profit margin hit a six-year high."
- Furthermore, the MedPAC Study found specifically that the profitability of general hospitals remained stable over time even when faced with a physician owned
hospital in the same market area. According to MedPAC, "The financial impact on community hospitals in the markets in which physician-owned specialty hospitals are
located has been limited, thus far. Those community hospitals competing with specialty hospitals have demonstrated financial performance comparable to other community
hospitals." MedPAC Study, summary pg. vii.
- When competition exists in any industry, including healthcare, service is improved, efficiencies are heightened and costs are controlled. In fact, the
MedPAC Study reported that competition provides community hospitals with a stimulus for change; and that community hospitals often responded to the presence of surgical
hospitals by "improving their own performance." MedPAC Study, pg. 10.
- Let competition work. A joint study between the Department of Justice and Federal Trade Commission found that the American free-market system is built on the premise that
open competition and consumer choice maximize consumer welfare, even when complex products and services such as healthcare are involved. "Improving Healthcare:
A Dose of Competition," A Report by the Federal Trade Commission and the Department of Justice, July 2004. "Healthy competition equals healthy consumers. Consumers want
high-quality, affordable, accessible health care, and the challenge of providing it requires new strategies," said FTC Chairman Timothy J. Muris.
- Let's put consumers in charge of healthcare... The current healthcare industry is made up, in large part, of vertically integrated delivery systems that have proven an
economic nightmare. On the other hand, physician owned hospitals are focused, not integrated, leading to lower costs and better efficiency. The focus is on what the
consumers want and need. This is the model for the future, patient choice - consumer driven healthcare.
The debate over physician owned hospitals should be about how patients and communities can best be served. At PHK, we believe that patients can best make that decision. Competition and innovation have served this country well. Those same forces should be
allowed to continue as we all search for improved care and access at the lowest cost.
Information provided by the Physician Hospitals of America.