It usually comes as a surprise to Texans when they learn that a state law prohibits hospitals from “employing” physicians. As a rule, doctors in Texas are independent and self employed. They may contract with a hospital to provide medical services or become an employee of a physician-owned medical practice group incorporated under section 501A of the IRS laws. Physicians are the lifeblood of rural health care and hospitals can’t admit patients or treat them on their own.

The problem for many rural communities that need to recruit physicians is that more and more physicians are asking to be an employee of the local hospital with a paycheck, health insurance and retirement. They are not interested in establishing a medical practice in a small town and taking on the financial risk that goes with it. And, it is often not practical to set up a 501A corporation with such a small number of doctors to pool together and set up a separate benefits plan. A 501A corporation is how larger medical groups and hospitals have legally circumvented this old law for years. The creation of these separate corporations, with more bureaucracy and added cost to the taxpayers, is not feasible for rural physicians and hospitals.

With health care access seriously challenged in rural areas, this outdated law is becoming a significant barrier. The situation is aggravated by the fact that many doctors are moving to Texas from states that do allow physicians to be employed. In fact, only a half dozen states have any laws that restrict the employment of a physician. The problem will only get worse. A recent Texas medical school survey shows that three-fourths of upcoming doctors in family and internal medicine would prefer to be employed by a hospital.

Texas rural hospitals and communities see the handwriting on the wall and are asking the Texas Legislature to catch up with the rest of the world by creating an option for rural hospitals to offer employment to any physicians that desire to be employed rather than work independently. Sen. Robert Duncan of Lubbock, whose district has more rural hospitals than any other in the state, has introduced Senate Bill 1500 in the Texas Legislature to allow hospitals of counties of 50,000 or less population to have the option to hire doctors.

At the same time, 12 state representatives and 6 senators with partly rural districts are also proposing bills to help their local rural hospitals by allowing them to employ physicians. Sen. Craig Estes and Rep. David Farabee are sponsoring bills to allow the hospital in Electra to employ physicians. This is being done at the request of both the physicians and the hospital board. Sen. Estes and Rep. Farabee are to be commended for their vision and commitment to enhance health care access in Texas.

An interesting point in this political debate is the fact the Legislature in years past has made many exceptions for its own institutions and certain local hospital districts. Doctors can be an employee of a medical school, prison, and state school. Community health centers and over a dozen hospitals districts across the state can already hire doctors.

Some will argue that if hospitals employ physicians, the physicians will lose their autonomy and their independent medical judgment will somehow be compromised. This argument is unfounded. There are no systemic problems that have arisen in the medical schools, the other states, or the community health centers. Texas doctors are professionals and will always act in the best interest of their patients, just as hospitals are committed to do. Besides, if hospitals start telling doctors how to practice medicine, they are violating current state law.

The arguments may seem complex, but the answer is simple. This antiquated Texas law prohibiting the employment of physicians is a recurring barrier to the recruitment of talented young physicians to rural Texas and the time has come to change it.

Don McBeath is the director of Advocacy and Communications Texas Organization of Rural & Community Hospitals