Healthcare providers and advocates are invited to share their views on expanding the role of physician-led hospitals in Medicare, with a public comment period closing on June 9, 2026.
As the June 9 deadline approaches, the Centers for Medicare & Medicaid Services (CMS) is actively seeking input from healthcare providers, patient advocates, and industry groups regarding the future of physician-owned hospitals in the Medicare system.
This initiative marks the first time federal health regulators have formally requested public feedback on the potential for physician-led hospitals to participate more extensively in Medicare payment models. The agency is particularly interested in whether these hospitals should be allowed to voluntarily engage in the Transforming Episode Accountability Model (TEAM), a value-based care initiative designed to enhance patient outcomes while reducing costs.
The public comment period is part of CMS’s Fiscal Year 2027 Inpatient Prospective Payment System (IPPS) proposed rule, and it invites a wide range of stakeholders—including healthcare organizations, physicians, medical societies, and patient advocates—to share their perspectives on this significant issue.
Supporters of physician-led hospitals view this request as an opportunity to reassess longstanding restrictions that have hindered the growth of these facilities for over a decade. Dr. Carlos J. Cardenas, president of Physician-Led Healthcare for America, characterized CMS’s outreach as a pivotal change in the federal government’s stance on physician-led care.
“The landmark moment is the fact that for the first time, it appears that CMS is not asking whether physician-led hospitals should be included, but rather, how do we include them in the delivery of care and in how we can better serve our patients,” Cardenas stated.
He further emphasized that physician-led hospitals have consistently shown strong results for patients, asserting that they deliver higher quality care, greater efficiency, and improved patient satisfaction. Despite these advantages, Cardenas noted that access to these models remains limited for many patients, a situation he believes needs to change.
Under the proposed rule, CMS is soliciting input on various questions, including which physician-owned hospitals should qualify for participation, the necessity of regulatory waivers, safeguards to protect patient choice, and compliance management after participation periods conclude.
Advocates argue that expanding the role of physician-led hospitals could contribute to lowering healthcare costs while maintaining high standards of care. Research has indicated that physician leadership in healthcare organizations often correlates with higher quality ratings and better operational efficiency without compromising financial performance.
Cardenas described the request for information from CMS as a significant shift in policy discussions, suggesting that physician-led providers are now being invited to participate in conversations about healthcare delivery models in unprecedented ways. He believes that involvement in programs like TEAM would enable physicians to directly influence the design and evaluation of care models aimed at enhancing outcomes and resource utilization.
Proponents also contend that increasing the presence of physician-led hospitals could address concerns regarding consolidation in the healthcare sector. They argue that fostering greater competition may provide patients with more choices and stimulate innovation in care delivery.
Studies have shown that hospitals with strong physician leadership tend to achieve higher patient satisfaction and quality outcomes. Additionally, patient-centered care models have been linked to lower costs and improved efficiency.
However, the proposal has not been without its critics. Some healthcare organizations have expressed concerns about the implications of expanding physician-owned hospitals. Critics have raised issues related to patient selection, market competition, and the potential for overutilization of services. Not all healthcare organizations support the expansion of physician-owned hospitals.
In a joint statement, Ashley Thompson, Senior Vice President for Public Policy Analysis and Development at the American Hospital Association (AHA), and Don May, Executive Vice President of the Federation of American Hospitals (FHA), highlighted important limitations facing physician-owned hospitals.
“Previous analysis has also shown that POHs report on fewer quality measures and have higher re-admission measure penalties,” they stated. “Compared to full-service hospitals, POHs are limited in the scope of services offered, often specializing in one type of care, like cardiac or orthopedic surgery, and treating patient populations that are younger, more likely to be commercially insured, and present with less complex conditions.”
Thompson and May also pointed out that, unlike full-service community hospitals, physician-owned hospitals are not obligated to provide emergency care and often depend on nearby facilities for emergency services.
As CMS evaluates potential future policy changes, it is actively seeking stakeholder feedback on these critical issues. For advocates of physician-led care, this consultation represents a rare opportunity to influence the direction of Medicare policy.
With the public comment window nearing its close, healthcare professionals and patient groups are encouraged to submit their views on whether physician-led hospitals should play a more significant role in delivering care under federal healthcare programs, according to Source Name.