CASE STUDY: MEDICAL CENTER AT ELIZABETH PLACE

A Physician-Owned Hospital Opens in Dayton, OH

With the federal moratorium on physician-owned hospitals lifted, Regent Surgical Health moved to open a hospital in Dayton, Ohio, and convert an ambulatory surgery center into a hospital in Calumet, Indiana.

Called Medical Center at Elizabeth Place, the 26-bed, four operating room hospital in Dayton opened in September 2006 and serves the greater Dayton community with the latest, most advanced medical procedures, including general surgery, orthopedics, GI, ophthalmology, diagnostic imaging, gynecology, neurosurgery and urology. Owned by 60 Dayton-area physicians, Regent holds a minority share and runs the hospital for the physicians. Situated on the site of the shuttered St. Elizabeth’s Hospital, the new Medical Center at Elizabeth Place is helping restore the former hospital to its landmark status and bringing high quality, efficient healthcare to Dayton.

Medical Center at Elizabeth Place is part of a "medical mall;" the hospital shares space with 75 healthcare-related tenants on the 26-acre campus near downtown Dayton. The city of Dayton had welcomed the venture by providing a $100,000 economic development grant.

In addition to high quality care, the hospital has its own pathology lab and an adjoining diagnostic imaging center with MRI and CT.

Physician partners say Medical Center at Elizabeth Place is a return to healthcare as it used to be: personal, compassionate care in a patient-focused setting.

"By opening this physician-owned hospital, we are helping to restore a longtime asset to the community, and we are returning healthcare to the control of physicians and their patients," says John Fleishman, board president and an ophthalmologist.

The opening of the physician-owned hospital did not come without a fight. The local hospital system, Premier, tried to intimidate physician owners and non-owners by sending letters, holding meetings and making phone calls to doctors. Several were threatened with loss of privileges and termination of office leases. Yet Premier’s attempts to stop the hospital from opening galvanized physician owners, and an ensuing public relations campaign by Medical Center at Elizabeth Place put the hospital system on the defensive. "The non-profit hospitals are generally allergic to competition," says Fleishman. "So we simply told our story and reminded the public that being a for-profit venture is a good thing in America."

According to the American Medical Association (AMA), specialty hospitals "offer improved, cost-effective care." They "encourage competition between and among health facilities, which has led to the delivery of higher quality, more efficient and innovative health care in the communities in which they are located."

As a for-profit venture, Medical Center at Elizabeth Place pays corporate and property taxes; non-profit hospitals do not pay taxes. Premier also argued that it takes all cases without regard for ability to pay, yet Medical Center at Elizabeth Place also takes care of the indigent population in Dayton. "We will not turn away a patient based on ability to pay," says Fleishman.

Medical Center at Elizabeth Place is one of about 125 physician-owned hospitals in America, according to the American Surgical Hospital Association. Regent CEO Tom Mallon expects that number to rise.

"Physicians and patients have increasingly larger roles in the way healthcare is delivered in this country, and that will lead to not only higher quality care but more efficient care. Our role is to help physicians build the healthcare facility that the community needs—and in Dayton at Medical Center at Elizabeth Place, we are helping bring quality care back to a once-great hospital building."