NCPA - National Center for Policy Analysis


September 12, 2006

The state of Kansas is among a number of states currently wrestling with the implications of a significant growth in the number of specialty hospitals within its borders, says Matthew Hisrich, senior policy fellow at the Flint Hills Center for Public Policy.

Claims that specialty hospitals cherry-pick patients and undermine community care not only avoid the primary issues at stake, but face a significant body of research that calls such claims into question, says Hisrich.  It is vital that politicians avoid the trap of debating superficial points when more fundamental questions confront the state, including:

  • Health care pricing that distorts the marketplace.
  • Hospital cross-subsidization, in which higher profit procedures subsidize less profitable ones.
  • The non-profit status of hospitals.
  • The benefits of competition and the dangers of market intervention.

If the underlying cause of the growth in specialty hospitals in Kansas and elsewhere is a product of government intervention, then scaling back that intervention should lead to their demise, says Hisrich.  But if specialty hospitals do indeed fulfill a consumer niche within the health care market, then they will survive absent built-in advantages within the current government pricing structure.

Ultimately, the decision should not be left to lobbyists and government agencies far removed from the day-to-day health care needs of the average citizen, but instead should be in the hands of dispersed consumers acting in their own best interests both in Kansas and throughout the country.

Source: Matthew Hisrich, "Clearing the Air on Specialty Hospitals," Flint Hills Center for Public Policy, September 5, 2006


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