Progressive Lawmakers Introduce Bill to 'Get Wall Street Out' of Medical Offices Across US

Thanks to legislation passed in Oregon last year, physicians in the state have stopped corporate takeovers of medical practices—and six Democratic members of Congress on Wednesday introduced a bill to replicate the state law nationwide, arguing, as Sen. Elizabeth Warren said, that "patients want to know that decisions about their health are being made by their doctors, not by Wall Street investors."

The Massachusetts Democrat was joined by Sens. Ron Wyden (D-Ore.) and Jeff Merkley (D-Ore.), along with Reps. Val Hoyle (D-Ore.), Alexandria Ocasio-Cortez (D-NY), and Suhas Subramanyam (D-Va.) in introducing the Stop Corporate Takeovers of Physicians Act.

The bill would ban the corporate practice of medicine by making it illegal for private equity funds, insurance companies, and other for-profit corporations to own or control medical practices—as is increasingly the case in the profit-driven US healthcare system.

Over 80% of doctors in the US are employed by corporate entities including private equity firms—up from 62% just seven years ago, according to the lawmakers.

Corporations have also exploited legal loopholes that allow them to take over medical practices, despite laws in over 30 states banning the corporate practice of medicine.

“Americans want medical decisions to stay between patients and their doctor, not dictated by corporate actors and private equity firms focused on maximizing profits,” said Wyden. “I’m proud of Oregon’s pioneering state law that has been used by doctors to protect their independence, and it’s time to take that model to the federal level. Corporate medicine is making healthcare more expensive for everyone, and safeguards must be put in place to ensure healthcare decisions stay in the hands of physicians.”

The legislation would:

• Close the “friendly physician” loophole that has allowed investor-backed corporations to evade state-level bans on the corporate practice of medicine and control medical practices through management service organizations (MSOs);
• Prohibit an MSO from controlling a medical practice through a “friendly” or “captive” physician, or by taking over business, administrative, and clinical functions such as hiring and firing, work schedules, compensation, disbursement of revenue or setting of revenue targets, billing practices, contracting, and other services;
• Ensure that physicians retain ultimate control of medical practices by requiring that physician owners are meaningfully engaged in providing medical care in the state in which their practice is located; and
• Protect physician independence by prohibiting corporate interference with clinical decisions and banning restrictive contract terms, such as noncompete agreements, nondisclosure agreements, and nondisparagement agreements.

Such entities "often cut corners, leading to patients paying more for significantly worse care," said Ocasio-Cortez. “I’m proud to co-lead the Stop Corporate Takeovers of Physicians Act to get Wall Street out of Americans’ doctors’ offices."

Warren added that "doctors should be able to do what's best for their patients, not what's best for some wealthy investor."

The legislation is supported by several medical associations as well as economic justice advocates.

"A prohibition is only as strong as its enforcement, and this bill backs its corporate practice of medicine (CPOM) prohibition with three enforcement paths: the Federal Trade Commission, state attorneys general suing on behalf of residents, and physicians themselves through a private right of action with treble damages. That layered enforcement, paired with mandatory divestment, is what gives this bill teeth that earlier CPOM laws have often lacked,” said Dr. Marco Fernandez, president of the Association for Independent Medicine.

Alex Lawson, executive director of Social Security Works, said that the "groundbreaking legislation is absolutely needed to give health providers and patients a fighting chance against corporate greed."

"Congress must stop private equity from ripping the copper wires out of American healthcare and put patients first," said Lawson. "Social Security Works is proud to endorse this legislation."

Charles Idelson, the former communications director of National Nurses United, which advocates for Medicare for All, said the bill "would help close some, though not all, of the worst profiteering in healthcare."

"Exploiting sickness to enrich wealthy executives," said Idelson, "is obscene."