According to William G. Plested, MD, AMA President-elect, "The American Medical Association is pleased with findings from MedPAC's updated analysis, which adds to the growing body of knowledge on the benefit of specialty hospitals. This analysis is good news to everyone who believes competition and choice positively affect the quality of health care.

"The case against specialty hospitals has centered around the alleged impact on the bottom-line of community hospitals. Yet MedPAC's report found that specialty hospitals have no statistically significant impact on community hospitals' total revenue or total margins. Contrary to the claim of specialty hospital detractors, MedPAC found no evidence that financial incentives play a role in increased utilization of heart surgery. MedPAC also found that Medicare patients had shorter than expected lengths of stay in specialty hospitals. This finding correlates with other studies that have found high patient satisfaction in specialty hospitals.

"The AMA agrees with Chairman Hackbarth's comments that the hospital payment system should be revised to eliminate the need to use higher paying services to subsidize those that are lower paying or uncompensated. Congress should change the Medicare Hospital Prospective Payment System to minimize the need for cross-subsidization and accurately reflect relative costs of hospital care."

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