I heard one doctor say last fall, that she knew of (or possibly was involved in) a project to start a direct pay acute-care hospital, but I have not been able to get any more about it or any other attempts to clear this last, big hurdle to setting up the full compliment of parallel medical institutions.
Government regulations, such as the Stark Law and the Affordable Care Act (ACA), limit physicians’ ability to own hospitals by prohibiting self-referrals and restricting the establishment or expansion of physician-owned hospitals participating in Medicare. These measures have shifted hospital ownership to large corporate entities. This shift has given rise to the corporate practice of medicine, where the financial priorities of health systems often focus on revenue generation rather than patient-centered care. Unfortunately this corporate model compromise care quality, reduce physician autonomy, and prioritize high-margin services over essential but less profitable ones. In addition, these large health systems are increasingly acquiring physician practices, and as of 2024, over 80% of doctors are employed within corporate practices. This trend is accelerating the decline of private practice, as government policies continue to cut physician compensation without adjusting for inflation, making independent practice financially unsustainable. As a result, private doctors are on the verge of extinction, raising concerns about the future of medicine and patient care quality.
I receive most of my major medical care in Panama. For instance, we recently had a baby there, and the total cost for everything, including a C-section, OB services, anesthesiology, assistants, medications, and a 3-day stay in a private OB suite, was approximately $6,000 out of pocket. We found the quality of care to be superior to that in the U.S., all at a fraction of the cost.
There are ways around Stark, like making the physicians debt-holders, instead of equity-holders. I’m not sure what ACA did, but you are making my point for me, since a direct-pay hospital would not accept Medicare or big health plans. Ambulatory surgery centers, like Surgery Center of Oklahoma are showing that direct-pay for outpatient surgery is often cheaper through their direct-pay surgeons than through major-medical plans. Acute-care hospital pricing shenanigans are making an increasing number of Americans willing to look for, and pay more for, predictable alternatives.
Since asking this question, I became aware of an effort by Dr. Paul Dibble in Humble, TX, to start such a hospital. There is a website in WaybackMachine that calls it Beacon Medical Center, but the effort appears to have folded, and my emails to the info@ address have gone unanswered.