July 17,2009

Death at Colorado Physician-Owned Hospital Deepens Concerns about Safety at Those Facilities

Finance Leaders say incident exemplifies long-standing concerns about patient safety, questions about physician-owned hospitals’ participation in Medicare

Washington, DC – Senate Finance Committee Chairman Max Baucus (D-Mont.) and Ranking Member Chuck Grassley (R-Iowa) said today that the death of a patient at a Denver, Colorado physician-owned hospital deepens concerns about safety at those facilities and raises further questions about their participation in the Medicare program. According to news reports of the incident, the patient was given a painkiller and shortly thereafter became unresponsive, prompting staff at the physician-owned hospital to call 911 to transport the patient to a nearby community hospital. The patient died at that hospital four days later. Baucus and Grassley have long been concerned about patient safety at physician-owned hospitals and have questioned whether they should continue to be eligible to participate in the Medicare program.

“I am deeply saddened by the death of this patient and my thoughts go out to her family,” Baucus said. “I have long been concerned about physician-owned hospitals’ ability to respond to emergency situations, and this tragic incident heightens that concern. All hospitals should provide safe and effective treatment for all patients. Seniors in Medicare should feel confident their care is safe regardless of where they receive it, and I intend to use health care reform as an opportunity to continue fighting to ensure that.”

“Senator Baucus and I have worked for years now to address the concerns that come with physician- owned hospitals, including inherent conflicts of interest for physician owners and, more importantly, patient safety,” Grassley said. “I remain concerned about the ability of these facilities to address emergency situations. At minimum, patients going in for surgery and other procedures ought to be able to expect that these facilities have adequate emergency capabilities.”

The Denver Post reported that the Colorado State Health Department found problems with the administration of painkillers and the immediate response to the emergency situation. It also reported that the investigation found that the hospital lacked documentation as to whether staff members were properly trained in emergency procedures. In an agreement with the health department, the physician- owned hospital where the incident occurred, the Colorado Orthopedic and Surgical Hospital, has suspended all elective surgeries.

Baucus and Grassley have long questioned whether physician-owned hospitals should participate in the Medicare program because of concerns that these facilities are often not properly staffed or equipped to handle emergencies, that there is a conflict of interest when physicians who own or invest in hospitals self-refer patients, and that these hospitals have a tendency to cherry-pick healthier and wealthier patients, thereby discriminating against the sickest and lowest-income Americans. As part of health care reform efforts this year, Baucus and Grassley have proposed preventing any new physician- owned hospitals from participating in the Medicare program and increasing safety precautions at existing facilities.