AB 2024, passed the Assembly Health Committee. The bill would give rural hospitals special privileges to hire doctors in an effort to lure more healthcare providers to California’s rural communities.
Assemblyman Wood said, “We are experiencing a healthcare crisis. Rural California has 1 physician for every 3,500 people, and the average age of that one physician is 60. It is crucial that we find ways to convince physicians to practice in our small towns.”
A 2015 survey indicated that 92% of final year medical residents would prefer employment with a salary versus working independently. However, California has a statewide prohibition of the “Corporate Practice of Medicine” (CPM). This policy means that physicians cannot be employed by hospitals; they must act as independent contractors. The idea is to shield healthcare providers’ decision making from the business interests of the hospital.
“Unfortunately in our rural communities it can be extremely challenging for physicians to make it,” said Wood. “It is a daunting task for young physicians, who are often tens of thousands of dollars in debt, to move to a small town and build a practice from the ground up.”
AB 2024 would exempt 28 rural health clinics and critical access hospitals from the statewide prohibition of CPM and allow these rural hospitals to employ physicians.
AB 2024 will be heard next in Assembly Appropriations Committee.