Oral arguments for a lawsuit challenging the new ban on physician-owned hospitals will be heard on Sept. 29 at U.S. District Court in Tyler, Texas.
The lawsuit, filed by Physician Hospitals of America and Texas Spine & Joint Hospital, charges the ban is exclusionary and unconstitutional, eliminates competition and will erode patient choice and affordability. The court will make a ruling within 30 days. Plaintiffs are hoping the judge will call for a trial based on the facts of the case, but whoever loses is expected to appeal the decision.
Plaintiffs feeling optimistic
"We feel optimistic about our arguments," says Scott Oostdyk, an attorney at McGuireWoods, representing the plaintiffs. "Basically, the law targets one type of ownership class — physicians." Since the lawsuit was filed in June, both sides have been conducting depositions, filing briefs and preparing for oral arguments.
The ban, part of the healthcare reform law, prevents Medicare certification for new physician-owned hospitals after Dec. 31 and has prevented existing centers from expanding since the reform law was signed in March. There are currently more than 260 physician-owned hospitals in 38 states.
Texas Spine & Joint Hospital invested almost $3 million in permits and licenses for the new facility and planned to spend $27 million on the project, but the project was suspended before breaking ground. Texas Spine was told, in effect, "Tough luck, you got to eat it," Mr. Oostdyk says.
Read more about Physician Hospitals of America.
The lawsuit, filed by Physician Hospitals of America and Texas Spine & Joint Hospital, charges the ban is exclusionary and unconstitutional, eliminates competition and will erode patient choice and affordability. The court will make a ruling within 30 days. Plaintiffs are hoping the judge will call for a trial based on the facts of the case, but whoever loses is expected to appeal the decision.
Plaintiffs feeling optimistic
"We feel optimistic about our arguments," says Scott Oostdyk, an attorney at McGuireWoods, representing the plaintiffs. "Basically, the law targets one type of ownership class — physicians." Since the lawsuit was filed in June, both sides have been conducting depositions, filing briefs and preparing for oral arguments.
The ban, part of the healthcare reform law, prevents Medicare certification for new physician-owned hospitals after Dec. 31 and has prevented existing centers from expanding since the reform law was signed in March. There are currently more than 260 physician-owned hospitals in 38 states.
Texas Spine & Joint Hospital invested almost $3 million in permits and licenses for the new facility and planned to spend $27 million on the project, but the project was suspended before breaking ground. Texas Spine was told, in effect, "Tough luck, you got to eat it," Mr. Oostdyk says.
Read more about Physician Hospitals of America.