HB 6873, An Act Strengthening The Review Of Health Care Entity Transactions

TESTIMONY OF THE CONNECTICUT HOSPITAL ASSOCIATION
SUBMITTED TO THE PUBLIC HEALTH COMMITTEE

Monday, March 3, 2025

The Connecticut Hospital Association (CHA) appreciates this opportunity to submit testimony concerning HB 6873, An Act Strengthening The Review Of Health Care Entity Transactions. CHA opposes the bill.

Connecticut hospitals and health systems care for patients, strengthen the state’s economy, and support vulnerable communities across the state. Every day, they work to improve healthcare access, affordability, and health equity. Even as they face ongoing challenges, hospitals provide world-class care to everyone who walks through their doors, regardless of their ability to pay. Hospitals also support an exemplary workforce as the largest collective employer in the state, contribute significantly to the state’s economy, and invest in their communities addressing social drivers of health.

According to the Governor’s fact sheet on HB 6873, this legislation was proposed to address the involvement of out-of-state, for-profit healthcare companies and private equity firms in Connecticut’s healthcare system. Despite the extensive amount of information provided to the state by hospitals and health systems each year and the state’s laborious certificate of need (CON) process, the state has missed or not fully understood significant private equity backed financial transactions that have had a deleterious impact on the delivery of healthcare in Connecticut. We support the narrow effort required to provide the state with information it needs so that these negative impacts can be avoided.

Unfortunately, what is described in the Governor’s fact sheet as a narrow focus on private equity backed and for-profit transactions isn’t actually what the bill does. Instead, the bill extends significant regulatory oversight to the Office of the Attorney General (AG), empowering the AG to run a quasi-CON process, and provides the Office of Health Strategy (OHS) new regulatory oversight through the auspices of the AG’s new authorities. The authority extends far beyond private equity and for-profit transactions. The bill will create a regulatory morass, likely delaying or impeding legitimate healthcare transactions.

Additionally, the bill significantly expands the jurisdiction of OHS without legislative oversight. The bill, through the AG, will allow OHS to further its policy goals outside of the direction of the legislature. We know from experience with today’s current CON process that OHS often attempts to attach unrelated policy riders to CON negotiations and approvals. If adopted, HB 6873 will provide OHS with yet another venue to advance its agenda without legislative oversight.

We believe that the AG has an important role in ensuring that healthcare transactions are in the best interest of the state, and today the AG executes that role effectively. To the extent the AG believes that additional regulatory authority is required for review of a narrow subset of healthcare transactions, then we are interested in working with the AG and the Committee to identify how that authority can be constructed. We cannot support, however, the broad additional authority created in HB 6873.

Thank you for your consideration of our position. For additional information, contact CHA Government Relations at (203) 294-7301.