What happened in Florida should stay in Florida. On July 1, one of the worst pieces of protectionist legislation ever passed in the history of the healthcare industry took effect in the Sunshine State. As reporter Michael Romano disclosed in last week's issue (p. 6), the new state law, the first of its kind in the country, bans the creation of any healthcare facility that focuses solely on cardiac, orthopedic or cancer care. The unprecedented attack on specialty hospitals prohibits such facilities regardless of ownership. Florida currently doesn't have any specialty hospitals and unless the state law is overturned, it never will.
And Florida's general acute-care hospitals couldn't be happier. They will never have to face the same type of competition from specialty hospitals, physician-owned or otherwise, that their peers in dozens of other states have to face. They clearly are the big winners under the legislation.
And the losers? Just those pesky patients who might have benefited from inpatient facilities that focus their operation on one type of clinical diagnosis. If health-services researchers are correct, positive treatment outcomes are highly correlated with the experience level of practitioners and facilities doing the treatment. The more you do, the better you are at doing it. Unfortunately, Florida residents with heart problems, bad hips and lumps in their breasts won't have access to those specialty facilities. Neither can they benefit from the cardiac, orthopedic or oncology programs at general acute-care hospitals that may have improved their treatment protocols-and even lowered their charges-because of competition from specialty hospitals.
Instead, patients in Florida who need that care will have access to the same facilities providing the same quality of treatment at the same price. We hope that care will be good. But as we all know, small community hospitals that dabble in high-profit clinical programs like cardiac, orthopedics and oncology may not always offer the best care. The same law, as Romano reported, relaxes certificate-of-need regulations for open-heart surgery programs in the state.
Of course, Florida's general acute-care hospitals will argue that access to high-quality care of all kinds will improve because those high-profit programs, now protected from competition, will help fund less profitable or even money-losing services. We'll see. And why ban specialty hospitals in just those areas? If specialty hospitals are so bad, why not ban those that focus on maternal health, neurology or burn care? Perhaps the profit margins aren't as high in those areas so the threat of competition doesn't exist. Talk about cherry-picking.
As readers of this page know, Modern Healthcare is a strong proponent of competition in the healthcare system, as we believe competition improves quality, expands access and controls costs for patients. Florida's law is nothing more than special-interest legislation that denies those benefits to sick people.
In previous editorials, we've also supported the abolition of all state CON laws. If you've been following the titillating CON dispute in Illinois, you'll know why. As reporter Mark Taylor wrote in our July 5 issue, a hospital in suburban Chicago filed a federal whistle-blower lawsuit against a construction company, a former member of the Illinois Health Facilities Planning Board and an investment banking firm over the hospital's proposal to build a $169 million satellite hospital in a neighboring community (p. 14).
The suit alleges that the construction company and the investment bank said that unless the hospital used them to finance and build the new hospital, they would use their clout with the planning board to deny the hospital's CON application. To gather evidence for its case, the hospital's CEO reportedly wore a hidden microphone to record a meeting with an executive of the construction company. When CEOs have to start wearing wires to get capital projects off the ground, it's time to eliminate all CON laws. Give competition a chance.