DaytonDailyNews.com

The end of an 18-month federal moratorium on doctor-owned hospitals in 2006 didn't stop the debate.

The version of the State Child Health Insurance Program expansion bill passed by the House of Representatives in January would have halted new construction of doctor-owned hospitals by making them unable to receive Medicare payments and restricting expansion of current ones. That wasn't part of the bill President Barack Obama signed into law in February.

And in 2007, Ohio Senate Bill 120, co-sponsored by then-state Sen. Steve Austria, R-Beavercreek, would have required hospitals to have 24-hour emergency rooms, which are not profit centers. That bill, also seen as a threat by physician-owned hospitals, never became law.

Critics of doctor-owned hospitals have said they siphon off profitable procedures in communities while leaving less profitable indigent care to others.

Tiffany Himmelreich, spokeswoman for the Ohio Hospital Association said of its 176 members, only five are physician-owned, for-profit hospitals, including the Medical Center at Elizabeth Place.

Ohio has eight physician-owned general medical/surgical hospitals, including two in Dayton (MCEP and Riverview Health Institute). Advocates say such hospitals give patients good, safe and cost-effective care driven by physicians, not business people.

"The challenges really come from those traditional, mainstay hospitals who, in some cases, are quite frankly afraid of the competition," said Tim Maglione, spokesman for the Ohio State Medical Association.

"There's no conclusive evidence that shows specialty hospitals have a negative impact on the financial condition of community hospitals," he said.

But since MCEP opened in September 2006, "we have seen some volume impact" for certain kinds of medical care, said LuJean Smith, a spokeswoman for Good Samaritan Hospital. She declined to say how much volume the hospital had lost.

Bryan Bucklew, executive director of the Greater Dayton Area Hospital Association (GDAHA), noted the Dayton area is the nation's fourth largest metropolitan area without a publicly funded community or university hospital to help nonprofit hospital networks bear the cost of indigent care. GDAHA currently has no members that are physician-owned general medical or surgical hospitals.

The region's nonprofit hospitals absorbed $185 million in uncompensated care costs in 2006. While that's an important part of the hospitals' mission that gives them their nontaxable status, Bucklew said a study showing how much hospitals would pay in taxes if they were for-profit would be enlightening to a sometimes skeptical public. The key would be getting the competing nonprofit hospital networks to participate in the study by disclosing financial data.

Alex Rintoul, MCEP's chief executive officer, said his hospital is interested in creating an emergency department when it gets a level playing field — managed-care contracts with health-insurance companies comparable to those of nonprofit hospitals. An emergency department is needed so MCEP is seen in the community as a "comparable hospital," he said.

The Centers for Medicare & Medicaid Services reduced reimbursement rates for certain procedures, making some less profitable for specialty hospitals, Bucklew said. But Rintoul feels nonprofit hospitals also have opened themselves up to risks by overextending themselves with building projects. That creates opportunity for MCEP to provide less expensive care, he said.

More important than letting physicians own hospitals is letting them run hospitals, said John Fleishman, a Dayton eye surgeon who's chairman of the Medical Center at Elizabeth Place.

"The only officials who take an oath to put the patient first are physicians," he said. "The problem we've got is nonphysicians running medicine."