HealthLeaders-InterStudy, a leading provider of managed care industry intelligence, reports that Houston's hospitals are caught in a vicious cycle of rising uncompensated costs from a growing uninsured population combined with an increasing loss of inpatient volume to physician-owned hospitals. According to the latest issue of the Houston Market Overview, Houston may well follow the lead of Dallas, as local health systems court physicians for joint ownership in office buildings and ambulatory-care centers in order to stop the drain of healthcare business.

"Joint physician-hospital ownership has proven quite successful in Dallas," said Patrick Powers, HealthLeaders-InterStudy senior analyst. "It remains to be seen how far it will progress in Houston. There are 10 physician-owned hospitals in Houston, and at least four more have been proposed. The mainstream hospitals, stuck with mandated low-margin services, are feeling the financial pressure, as niche physician facilities siphon off the more lucrative procedures, such as heart care, orthopedics, and diagnostic services. Already, the area's two largest health systems, Memorial Hermann Healthcare System and HCA Houston Network, are negotiating with physician groups about joint facilities."

In an effort to strengthen ties with local physicians, Memorial Hermann Healthcare System is offering joint-venture opportunities in the new surgery and endoscopy units that are part of The Century Project. The ambulatory surgery centers will be owned and operated in a partnership with Memorial Hermann and Dallas-based United Surgical Partners International.

HCA's Bayshore Medical Center, which has formed a partnership with Kirkwood Medical Associates, indicates that it will be looking for further relationships with physician groups.

Other news about the Houston healthcare market

California-based Molina Healthcare will enter Houston's busy Medicaid market as part of the state's plan to phase out its primary-care case-management program in Houston and transfer members to HMOs by the end of 2006.

About Market Overviews

Market Overviews provides a detailed analysis of local healthcare markets, allowing healthcare businesses to plan their local strategies.

About HealthLeaders-InterStudy

HealthLeaders-InterStudy, a company of Decision Resources, Inc. (, is the authoritative source for managed care data, analysis, and news. For more information, please visit

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   For more information, contact:     Alex Jablokow    Decision Resources    781-296-2562 

SOURCE: HealthLeaders-InterStudy

CONTACT: Alex Jablokow of Decision Resources, +1-781-296-2562,

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