- Introduced -

SB 523 - This act is known as the Nonprofit Hospital Sale Act. It gives the Attorney General supervision over an acquisition of 20% or more of the assets of a nonprofit hospital, and any acquisition resulting in a 50% or greater interest in a nonprofit hospital.

APPLICATION - Any person or corporation making such an acquisition in a nonprofit hospital must first apply to the Attorney General (AG) and the Department of Health (DOH). The application shall include a copy of the proposed agreement, a financial and economic analysis and any other documents requested by the AG or DOH. Approval must be received from the AG before the acquisition may be completed.

HEALTH DEPT. - The DOH must publish notice of the application in a local newspaper and shall notify individuals who have requested such notice. The DOH shall review the application with respect to: (1) continued access to affordable care in the community; (2) commitments to care for the disadvantaged and uninsured; and (3) conflict of interest safeguards for health care providers. The DOH shall make a recommendation to the AG within 30 days.

ATTORNEY GENERAL - The AG has thirty days to decide whether to consider the application and must approve or disapprove within 60 days after receiving the recommendation of the DOH. The AG shall hold at least one public hearing. The AG shall not approve the acquisition unless the value of the charitable assets are safeguarded and the proceeds are used for appropriate charitable health care purposes. Various factors are described for consideration by the AG.

A person with a legal interest in a hospital may obtain judicial review of the AG's decision. The AG's decision shall be approved unless there was an abuse of discretion. If the AG should receive information that the acquiring person is failing to fulfill the commitment to the community, the AG may begin proceedings to revoke the license of the purchaser.

CONFLICTS OF INTEREST - The act limits conflicts of interest between the buyer and the hospital and between the buyer and any nonprofit charitable institution which may receive assets.

ENFORCEMENT - Conditions are established, such as failure to get approval under this act or failure to follow conflict of interest rules, for revocation or suspension of a hospital's license.

The act has an emergency clause.

MICHAEL HOEFERKAMP