The debate over specialty hospitals: how physician-hospital relationships have reached a new fault line over these "focused factories"

Within the last 20 years, the fragile symbiotic relationship between physicians and hospitals has become increasingly strained. Physicians have created new healthcare delivery systems, including a host of for-profit, physician-owned specialty hospitals. Proponents of specialty hospitals argue that they provide high quality facilities and allow for innovative treatments. Opponents, however, contend that such hospitals "cherry pick" patients who otherwise would help to subsidize general hospitals, and point to the various fraud and abuse issues raised by physician-owned specialty hospitals. This Article examines the specialty hospital phenomenon and the arguments for and against such entities. It also analyzes whether an extension of the present federal moratorium on the construction of new physician-owned specialty hospitals is in the best interests of the country's healthcare system. The author concludes that the data are unclear as the overall impact of such hospitals and that they should not be further constrained until when and if the facts are clear.