“Visionary Partnership” – A Fading Line Between Non-Profits and For-Profits Medical Schemes?


Staff Writer

Published 08 February 2011 08:48 PM

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Texas Health Resources and a group of cardiologists announced Tuesday that they had entered a joint venture to open a dedicated heart hospital in Arlington.

The partnership is an example of not-for-profit hospital companies forming for-profit ventures with physicians.

Texas Health Resources, which receives a tax exemption as a not-for-profit company, has a majority ownership in the venture. Financial details were not disclosed.

“Any profits received by Texas Health go toward its nonprofit mission,” said Megan Brooks, spokeswoman for Texas Health.

The health care law signed in March places a moratorium on new physician-owned hospitals, such as the Texas Health Heart & Vascular Hospital Arlington. It also restricts expanding existing facilities.

Proponents of the ban say physicians, who have some control over patient admissions, could direct patients to their own hospital or boost revenue with unnecessary care.

The law placed a Dec. 31, 2010, deadline on new physician-owned hospitals. Texas Health’s heart hospital opened in November in a refurbished building on the campus of Texas Health Arlington Memorial Hospital.

“We worked hard to meet the deadline,” Brooks said.

In addition to extra revenue, Texas Health may benefit from improved quality scores that soon may be tied to reimbursement rates.

The U.S. Centers for Medicare and Medicaid Services now measures readmission rates of heart failure patients. Having a dedicated heart hospital next to a general acute-care hospital can be beneficial.

Take Baylor Health Care System’s arrangement in Dallas, for example. Its Baylor Heart and Vascular hospital is located on the campus of Baylor University Medical Center Dallas.

When patients come in with heart problems, Baylor sends the sicker patients to Baylor Medical Center Dallas. Those with more typical heart failure go to the specialty heart hospital.

This setup has helped Baylor’s heart hospital lead the nation with the lowest readmission rate for heart patients.

Patients who visit the emergency room of Texas Health Arlington hospital with heart problems will be transferred to the heart hospital for specialized care.

Kirk King, president of Texas Health Arlington hospital, called the venture a “visionary partnership” that will make it the “hospital system of choice for heart and vascular care in North Texas.”