BOSTON — Lawmakers on Monday rushed a hospital oversight bill to Gov. Maura Healey that aims to tighten regulation of private equity firms and increase penalties for companies that fail to submit required information. Agreement was reached on policy responses to the care crisis.
The Health Care Market Reform Act (H 5159) would give state health regulators and Attorney General Andrea Campbell more regulatory oversight of transactions involving private equity investors, health care real estate investment trusts, and managed services organizations. and executive authority.
House and Senate negotiators announced the agreement last Friday night, along with the prescription drug reform bill that Congress sent to Mr. Healey on Monday. Negotiations broke down at the end of formal legislation in July, but a breakthrough emerged just before the two-year term ended on Tuesday.
The late legislative maneuver leaves little time for Healey to communicate with Healey about potential changes to the bill, effectively giving him the power to decide whether to sign the bill into law or kill it. Ta. Pocket vetoes have been in place since the parliament that drafted the sweeping bill was dissolved.
The bill would increase penalties for hospitals that don’t comply with data reporting requirements, require lenders to notify states 60 days before recalling medical equipment, and help regulators manage health care costs and assess resources. The bill will thoroughly review the regulations and prevent the Ministry of Public Health from issuing permits for medical devices. Establish or maintain an acute care hospital whose main campus is leased from a real estate investment trust.
The compromise would not completely ban real estate sale-leaseback agreements, but would require formal notification of material changes to state health regulators. The Senate adopted this approach in its oversight bill, but the House bill would have prohibited such leases, which partially led to Steward’s bankruptcy.
Sen. Cindy Friedman, the Senate’s chief negotiator on both health packages, did not specifically mention Steward when explaining the compromise. But while the Arlington Democrat condemned the role of private equity in the health care sector, Senate Minority Leader Bruce Tarr disputed that view.
“There is no place for private equity in the delivery of health care. These two things are completely contradictory and are facts, not judgments,” Friedman argued on the Senate floor. “Private equity’s job is to make short-term profits for investors. Healthcare is about providing care and meeting the needs of people who need our help because of illness. Two is not a jive.”
Tarr did not mention Steward by name, but he said he “generally” agreed that Massachusetts has seen the “devastating results” of private equity in health care.
“I’m not prepared to agree to a blanket exemption as long as it’s a way for many health care providers, private equity, and especially small medical groups, to get the tools they need to provide health care.” said the Gloucester Republican. Said. “So I think these things need to be properly supervised and regulated, but I don’t agree with the proposition that there is no role for private equity in the delivery of health care.”
The compromise expands the oversight capacity of the Health Policy Commission, which in recent months has helped scrutinize the sale of some Steward hospitals to new owners.
Under the bill, the HPC would be able to scrutinize drug manufacturers, pharmacy benefit managers, private equity investors, health care real estate investment trusts, and managed services organizations at annual cost hearings.
Private equity transactions are subject to the HPC’s material change notification process, and regulators may request information such as audited financial statements. After the deal is approved, HPC could require companies to submit additional information over the next five years, a tool HPC officials lacked when selling Steward’s Physician Network to a private equity firm. is.
The agreement also requires private equity investors, health care real estate investment trusts, and managed services organizations to comply with financial reporting requirements to the Center for Health Information Analysis. Fines for companies that fail to submit requested data by the deadline will jump from $1,000 to $25,000 per week, with no cap.
The attorney general’s office would gain tools to hold private equity firms accountable under the compromise, including expanded investigative powers over health care transactions.
The House passed the hospital oversight bill 152-1 in May, and the Senate passed it 38-2 in July. House Speaker Ron Mariano withdrew the bill from conference committee negotiations early on Aug. 1 and told reporters by Oct. 22 that no “deal” was in place.
Tarr, a committee member on both the hospital oversight bill and the prescription drug reform bill, expressed frustration Monday with how Congress handled the agreement.
“These are extremely important issues, extremely complex and extremely impactful,” Tarr said on the Senate floor. “And Mr. President, we are considering them in private meetings, and we hope that we will consider them in formal meetings so that they can have their due debate and recorded vote. It’s a shame that I couldn’t do it.”
