Gov. Dannel P. Malloy has signed a bill that clears the way for nonprofit hospitals to convert to for-profits, a measure that grew out of intense, last-minute negotiations involving hospitals, unions and lawmakers from both parties.
In addition to removing a barrier that could have kept for-profit hospitals from operating in Connecticut, the bill expands state oversight over the sale of nonprofit hospitals and gives the state more oversight on transactions involving physician practices.
The change was prompted by the effort by the national for-profit hospital chain Tenet Healthcare to acquire Waterbury, Bristol, Rockville General and Manchester Memorial hospitals, in partnership with the Yale New Haven Health System. Lawmakers from those areas wanted to eliminate the state’s prohibition on for-profit hospitals employing physicians, while groups with concerns about for-profit hospitals pushed legislators for more restrictions on changes in hospital ownership. Other legislators had concerns about hospitals buying up physician practices.
The measure came together in the final hours of the legislative session last month. Less than an hour after it received final approval, Tenet and the Yale system released a statement that warned that unintended consequences of the bill could make it difficult for the company to move forward in Connecticut. That prompted some legislators who helped broker the deal — which they said had Tenet’s blessing — to question whether Tenet was pushing Malloy to veto the bill or seeking additional accommodations.
Last year, Malloy vetoed a bill that would have allowed Waterbury and Bristol hospitals — then the only state hospitals in talks with the for-profit company that Tenet later acquired — to become for-profit. His office was involved in negotiations on this year’s hospital bill.
Malloy also signed a measure prohibiting people under 18 from buying or possessing e-cigarettes or other electronic smoking devices.
The full list of bills Malloy signed Tuesday is available here.