Bill restricting for-profit hospital conversions advances
A controversial proposal that would put a moratorium on the conversion of nonprofit hospitals to for-profits garnered enough votes to move forward Tuesday, but several members of the legislature’s Public Health Committee said their “yes” votes shouldn’t be construed as endorsing the measure.
And one of the lawmakers who crafted the bill said it’s expected to undergo many changes before being finalized.
The bill was proposed in response to concerns about changes in the health care landscape, including the consolidation of hospitals and the potential acquisition of four nonprofit hospitals by a national for-profit chain. In addition to the moratorium on hospitals becoming for-profit, it would also new regulatory requirements for changes of ownership of nonprofit hospitals.
The moratorium wouldn’t apply to hospitals that apply to become for-profit by Oct. 1. Waterbury Hospital, which is pursuing a deal with the for-profit Tenet Healthcare and the nonprofit Yale New Haven Health System, is the only hospital with a proposal currently filed, but three other hospitals — Bristol, Rockville General and Manchester Memorial hospitals — are also pursuing deals with Tenet and Yale.
Labor unions and other groups have raised concerns about the growth of for-profit hospitals in Connecticut. But hospital officials have said that they need the flexibility to consider partnering with out-of-state partners, including for-profit companies that have better access to capital than nonprofits.
The bill that cleared the Public Health Committee Tuesday calls for state bonding money to be available for hospital capital improvements, but doesn’t specify how much.
Some critics of the measure said it would put too much of a burden on hospitals going through ownership changes.
“Oversight is essential. Oversight is needed. But my concern is excessive regulation, could it be counterproductive?” asked Rep. Prasad Srinivasan, R-Glastonbury, a physician.
Committee Co-Chairwoman Sen. Terry Gerratana, D-New Britain, said it’s better for consumers if hospitals going through ownership changes disclose more information. “I don’t know that we’re excessively regulating,” she said. “The intent is disclosure, and to know what you’re getting into.”
Srinivasan voted against advancing the bill. Rep. Peggy Sayers, D-Windsor Locks, voted for it to advance, but said she had reservations about its current form. She said she worried that if hospitals are overly restricted, some could close.
Rep. Michelle Cook, D-Torrington, also raised concerns about the proposal’s effect on hospitals, including Charlotte Hungerford Hospital, which is in her district.
In the last few years, Cook said, the state has “slapped around our hospitals.” Hospitals are subject to a recently imposed tax and have lost hundreds of millions of dollars in state funding, although Gov. Dannel P. Malloy’s administration has argued that they should recoup the money as more patients gain insurance under the federal health law.
Cook said she hoped and prayed the final bill would include provisions to ensure that hospitals are protected.
The bill cleared the committee 16 to 9.
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