Bloomberg: Pennsylvania Fights Hospital Closures With Curb on For-Profit Buyers

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(link) https://www.bloomberg.com/news/articles/2023-03-23/pennsylvania-bill-targets-maternal-care-desert-in-suburban-philadelphia?srnd=citylab-economy

Pennsylvania lawmakers plan to introduce legislation that would place a moratorium on private equity and other for-profit firms from buying hospitals in the state, following closures and cutbacks that curtailed care in parts of suburban Philadelphia.

The package of bills would also prohibit owners from taking out dividends within two years of an acquisition and limit a type of financing known as sale-leaseback transactions on hospitals’ real estate. The legislation was floated at the end of the session last year but didn’t progress. A separate bill introduced this year, meanwhile, would make it more difficult to close hospitals.

The legislation, which is similar to efforts to curb corporate ownership and closures in a handful of states like Rhode Island and Illinois, comes after cutbacks at private equity-owned Crozer Health and its closure of two Pennsylvania facilities: Springfield Hospital early last year in a move it called temporary, and Delaware County Memorial in November amidst a court battle over its future.

The private equity industry’s charge into hospital ownership has lawmakers and patient advocates across the country on edge just as labor shortages and inflation have thrown the industry into financial crisis. The backlash is unsurprising since private hospitals have a reputation for putting profits ahead of the needs of the community, especially in poor areas, said Alan Sager, professor of health law, policy and management at Boston University.

- more at link -

This is a developing story that can also be followed on the "Pennsylvania State Senate Co-sponsorship" website.
Link is here: https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=S&SPick=20230&cosponId=40280&mc_cid=a2a17effcd&mc_eid=3ab2f24ac3