Dive Brief:
- The Connecticut legislature is considering several bills which would impose more requirements on non-profit hospitals that seek to convert to for-profit status.
- Two bills, for example, would create tougher requirements for the regulatory approval process for such conversions, and would give the Attorney General more authority in approving the conversions.
- Bill opponents say they are overly broad and will create obstacles to partnerships that would otherwise help keep the hospitals afloat; supporters say that the bills are necessary to bring more transparency and oversight of any partnership or merger deal.
Dive Insight:
Looking at this situation, I feel that both sides have a point. On the one hand, transforming a not-for-profit hospital into a for-profit can take valuable resources out of the community, as for-profit hospitals don't have an obligation to create community benefit. On the other hand, this is a very difficult time for hospitals to function alone, and if profit/non-profit deals are overly burdensome to execute, it could indeed slow the pace of affiliations, mergers and acquisitions in a way which is harmful to all parties. It won't be easy to strike a balance that is fair to the deal-making hospitals yet transparent enough to allow the community to protect the resources it has.