House Looks To Remove Bill Banning Specialty Hospitals

Less than a year after lawmakers agreed to change how the state licenses hospitals, a House health-care panel on Wednesday approved a bill that would continue to alter the industry by scrapping a ban on specialty, or “boutique,” hospitals. 

The bill (HB 6059), sponsored by Rep. Heather Fitzenhagen, R-Fort Myers, would eliminate a prohibition on licensing specialty hospitals that restrict their medical and surgical services to cardiac, orthopedic, surgical or oncology care.

Fitzenhagen told members of the Health Market Reform Subcommittee that the goal was to eliminate the ban on specialty hospitals last year as part of a bill that repealed the state’s “certificate of need” regulatory process for hospitals. But the boutique-hospital provision was removed during negotiations with the Senate on the bill.

“So this is, in essence, going back to say, ‘Yes, we are still very strongly committed to get rid of the ban on specialty hospitals,” Fitzenhagen said.

The bill is opposed by the Florida Hospital Association, which fears that it would allow a proliferation of boutique hospitals that would siphon off insured and wealthy patients from already-established facilities but not treat the poor, though a staff analysis noted that “the number of hospitals that might seek licensure as a specialty hospital is unknown.”

An analysis of specialty hospitals conducted by the group America’s Health Insurance Plans concluded that care is more expensive at specialty hospitals than at non-specialty hospitals. The study used a measurement known as average “allowed amounts,” which are the maximum that health plans will pay for services.

The difference in average allowed amounts between the two hospital types ranged from $3,009 per patient to $48,811 per patient for19 services that were examined, according to the 2017 study. AHIP contracted with a third party to conduct the analysis.

“Only those patients undergoing mastectomy surgery at specialty hospitals resulted in a statistically significantly less per-patient cost than their peers treated at non-specialty facilities,” the report said.

Rep. Javier Fernandez, a South Miami Democrat who serves on the House panel, said he had “serious reservations about what this means for our general service hospitals.”

But Fitzenhagen said she filed the bill to “make sure that we bring the best possible care at the best possible price to Florida citizens.”

Crystal Stickle, interim president of the Florida Hospital Association, noted in a statement to The News Service of Florida that the impact of last  year's certificate-of-need repeal hasn’t been fully realized because the Agency for Health Care Administration is in the midst of updating hospital regulations. Under certificate of need, hospitals were required to get state approval to add facilities or certain services.

“It is premature to implement further deregulation before Florida’s health care system can respond to such a significant change. Florida should maintain the current patient protections that prohibit stand-alone, single service boutique hospitals,” Stickle said. “Any surgery can become high-risk, which is why it is critical that any hospital specialty surgical services be co-located, even within a separate building, with a full-service hospital to ensure rapid, quality responses to surgical emergencies that can arise.”

The Health Market Reform Subcommittee voted 9-4 to approve the proposal, a day after House Speaker Jose Oliva, R-Miami Lakes, lambasted hospitals and other parts of the health-care industry as modern-day “robber barons.”

“Now, I am not given to hyperbole, I use these words with precision. The health-care industrial complex --- made up of hospitals, medical device manufacturers and pharmaceutical companies --- are the great robber barons of our time,” Oliva said. “The term robber baron is defined by government manipulation, monopolizing industry and price gouging. Check, check and check.”

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