Health care workforce measure progresses despite pushback from governor, corporate hospitals

A bill sponsored by the Patient Protection Commission is making its way through the legislature despite pushback from the governor’s office.

The measure, Assembly Bill 11, would prohibit corporate hospitals and hospital systems from directly hiring physicians. Nevada hospitals have long refrained from directly hiring physicians, opting instead to hire them as independent contractors. The bill would formalize that practice into law.

The bill will also prohibit hospitals from restricting nurses and other health care providers they employ or have contracts with from discussing salary, wages, and working conditions with others. The legislation would also prohibit hospitals from imposing noncompete agreements that prevent them from working at other medical facilities.

“We don’t have enough doctors to be hired by every hospital, but we also have a real movement in Nevada and the whole country as well, towards consolidation of the hospital and whole health care industry so it’s easier for hospitals and health care systems to build market share,” Bobbette Bond, the Culinary Health Fund Policy Director, said at an earlier meeting on the bill. 

Four companies – HCA, UHS, Renown, and Common Spirit – own the bulk of Nevada’s acute hospitals and generate over 70% of the hospital revenues and profit in the state, according to a presentation given on the bill. But Nevada ranked first in the nation for the highest percentage of low-rated acute-care hospitals — those receiving one out of five stars – according to the Centers for Medicare and Medicaid Services.

Throughout the U.S. ownership of hospitals and health care systems is becoming increasingly consolidated and the result equates to higher costs to patients and lower compensation to providers, according to the Health Care Pricing Project. 

AB 11  was one of three bills submitted to the legislature this session by the Patient Protection Commission, which was championed by Democratic Gov. Steve Sisolak in 2019. At the beginning of the current session, Republican Gov. Joe Lombardo’s chief of staff wrote a letter to the commission expressing the governor’s office’s opposition to AB 11 and another bill they’d submitted.

But AB 11 was given a committee hearing and passed the full Assembly on a 26-16 vote last month. Democratic Assemblywomen Shea Backus and Shannon Bilbray-Axelrod joined Republicans in opposition. The bill passed through the Senate Health and Human Services Committee on Tuesday.

Hospitals that violate the bill’s provisions could face administrative penalties or, in the instance of repeat violations, have their license revoked or suspended.

The legislation would also require the Joint Interim Committee on Health and Human Services to study the employment of physicians by corporations during the 2023–2024 interim and allocate one additional bill draft to the committee to address the study’s findings.  

The Nevada Hospital Association is opposed to AB 11, arguing it would keep the state behind national trends. Nearly 40% of physicians worked either directly for a hospital or for a practice that was partially owned by a hospital or health system, in 2020, according to a report by the American Medical Association.

“In Nevada, we have a significant shortage of medical specialists, and many doctors today find it very challenging to go into private practice and pay rent and the personnel issues and the malpractice issues,” state Sen. Jeff Stone (R-Henderson) said during the Senate committee hearing. “For many of them, it’s just easier to work for an entity like a hospital. I believe this bill, if it passes into law, is going to limit the number of medical specialists that we have.” 

Proponents of the bill argue that the law would confirm the current practice in the state, allow graduate medical education programs in the state to hire doctors, and ensure that patients can get care at all hospitals where the doctor has privileges or contracts.