In small markets where hospital competition still exists, physicians can shop around for the deepest pocket.
Such is the case in Williamsburg, Va., where a group of 13 physicians found two hospital systems willing to co-sponsor its surgery center proposal after another hospital system rejected the proposal.
The physicians are teaming with two powerhouses, the national Bon Secours Health System and local Riverside Health System of Newport News, to develop a $3.6 million ambulatory surgery center.
Bon Secours owns 225-bed Mary Immaculate Hospital in Newport News, which would own 10% of the venture. Four-hospital Riverside would own another 10%, while the physicians would control 70%. A fourth partner, Edmond, Okla.-based Surgery Centers of America, would own 10% and manage the center.
The cost of the project would be divided according to ownership.
Riverside, which operates three acute-care hospitals, will construct the building regardless of whether its partnership group wins the surgery center battle, said Bud Ramey, a Riverside spokesman.
Ramey said the physicians approached Riverside and Bon Secours after their negotiations with competing Williamsburg Community Hospital collapsed.
"They had been working with Williamsburg Community to get more physician control of outpatient surgery, but they couldn't work it out," Ramey said. "Then they came to us and suggested it, and we were very interested."
Those 13 physicians are responsible for more than 40% of the outpatient procedures performed at Williamsburg Community Hospital, according to the state regulatory agency reviewing the certificate-of-need application to build the center. The project cannot proceed without state approval.
In danger of losing that business, Williamsburg Community is making its own bid for a surgery center. That pits Williamsburg Community, owned by six-hospital Sentara Health System of Norfolk, Va., a local chain, against Riverside.
Les Donahue, chief executive officer of Williamsburg Community, argues that the area would be better served if the surgery center were operated by the local not-for-profit hospital than by large out-of-town systems.
The systems' joint venture and Williamsburg Community submitted their CON applications to the regional regulatory agency Jan. 29. A decision could come as early as May.