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New York Scraps For-Profit Hospital Program

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A previously proposed for-profit hospital pilot program in New York currently will not see the light of day, as it has been dropped from the state's budget, according to a New York Times report.

In February, New York Gov. Andrew Cuomo proposed his executive budget for 2013-14, which included a provision that would have allowed for-profit companies to own and operate two hospitals in the state — one in Brooklyn and another in another part of the state. The demonstration projects were seen as a major shift because under New York law, all owners of a corporation that operate a for-profit hospital must be "natural persons." This essentially prevents investor-owned corporations from owning and operating hospitals.

The New York State Assembly nixed the program, and according to the report, Richard Gottfried, a Democrat and chairman of the Assembly's Health Committee, "would not budge" on allowing the program.

Investment firms hailed the for-profit hospital demo, which originally was proposed for 10 hospitals, and some still plan to pursue a way to revive the projects. The New York State Nurses Association praised the legislature for scrapping the measure. Jill Furillo, executive director of the NYSNA, told the Times, "For-profit healthcare does not work. People in the Assembly listened to us, and so did Gov. Andrew Cuomo."

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