Bill to Erode Ban on Hospitals Hiring Physicians Moves to Senate
CMA continues to fight state legislation (SB 726) that would erode the ban on the corporate practice of medicine in California by allowing certain hospitals to hire physicians directly.  Under current law, hospitals are barred from hiring physicians as employees. This important protection for doctors and patients was created to prevent corporations or others from influencing the professional judgment of physicians for financial gain.

SB 726 seeks to expand a pilot project that currently allows rural hospitals to employ only two physicians, with contracts limited to four years and the total of such hires capped at 20 statewide. SB 726 would greatly expand the program so that both rural and urban hospitals could hire up to five physicians each, and the hospitals would not need to meet requirements in the current pilot program for treating high numbers of underserved patients. Furthermore, SB 726 does not mandate that hospitals give physicians input on the hirings.SB 726 passed the Assembly in a close vote during the last week of June and is now awaiting a hearing in the Senate Rules Committee. CMA will continue to vigorously oppose the bill unless important changes are made.