On Jan. 8, Gov. Maura Healey signed a bill into law that will increase scrutiny of healthcare transactions, according to a Jan. 10 report from The National Law Review.
Here are five things to know about the new law:
1. The law specifically aims to increase scrutiny of private equity sponsors, significant equity investors, health care real estate investment trusts, management services organizations and pharmacy benefits companies in the state.
2. The passage of the current law follows waves of debate last year over similar bills.
3. The law also broadens the transactions that are subject to the state's Health Policy Commission's material-change notice requirements to include significant expansions to ownership capacity, transactions involving a significant equity investor that result in a change of ownership of a healthcare organization, real estate sale lease-back arrangements and other significant acquisitions, and conversation of a provider or organization from nonprofit to for-profit status.
4. The HPC will also now require more documentation of such transactions, including information regarding capital structure, financial conditions, ownership and management structure, and audited financials of equity investors.
5. The law also reduces the market share threshold for mergers and acquisitions that will be subject to the material-change notice requirement and expands review criteria for a cost- and market-impact review.