by Amin H. Karim MD
This section will recount in the journey some encounters with entities that representing venture (vulture) capitalists that come to town having done their homework which tells them that there are lot of dollars in the medical world. They also know most doctors are busy in their practices and have little time to look into other sources of income. So if they can be enticed into investing a little capital, sign up to work in the facility and get dividends they can have era income to supplement their practice income. Pretty simple concept and the share of limited partnership would conform to the Federal kick back laws.
I recall some of these (all are in public domain). Some were very successful for all parties concerned and some not so successful, some never got off the ground an some utter failures were the physicians lost everything.
HIGHLY SUCCESSFUL!
The one venture that has always impressed me and still does is the TEXAS ORTHOPEDIC HOSPITAL in Houston. in the early 90’s a large orthopedic group called the Fondren Orthopedic Group partnered with Hospital Corporation of America (HCA) to build a hospital dedicated to Orthopedic Surgery only with related entities like Radiology and Physical Therapy. There were about 20 partners in the group. I am not privy to what the financial arrangement was but word on the street was that the HCA would manage and operate the hospital in return for 20% of income and the rest would go to the Physician Partnership. The surgeons would use the hospital for most of their work. The model proved to be a great success. The hospital added a third floor and parking lot and continues to thrive with 50 plus orthopedic surgeon in one big group.
A second venture that proved very successful was the NORTH CYPRESS HOSPITAL on Highway 290 in Cypress. An entrepreneur made a mid size hospital with processional building and made physician own limited partnership interest in the hospital. The secret to their success was out of network billing which brought them huge profits and dividends to primary care and specialists who were partners and who worked at the hospital. For a while it worked till the savvy insurance carrier realized that patient with out of network benefits were preferentially being treated at the hospital. I think were lawsuits and not sure how they all ended. In any case the hospital was eventually sold to HCA System which now owns and operates the hospital.
GlobeMedic 