A bill that would make the Attorney General responsible for approving health care provider affiliations has drawn opposition from the medical community, which doesn’t want to grant such sweeping power to the government.
SB 977, which is supported by Attorney General Xavier Becerra, and sponsored by Sen. Bill Monning, (D-Carmel), passed the Assembly Health Committee Aug. 4 by a vote of 8-4 with three NVR (no votes recorded).
“The way SB 977 is written – it’s almost that you have to prove yourself innocent,” Jan Emerson-Shea, VP of external affairs at the California Hospital Association, told the Northern California Record. “There’s not a due process laid out in here, the power would very much reside in the hands of one elected official.”
The ability to create partnerships has become even more necessary amid the COVID-19 health crisis, Emerson-Shea said.
“There have been huge losses from COVID, and we’re very worried that some hospitals will not be able to keep their doors open long-term. One way they might be able to is to affiliate,” Emerson-Shea said. “There are small, independent facilities and rural hospitals that need a lifeline.”
Under the provisions of SB 977, the Attorney General could file civil action against entities deemed to be in violation, according to a news release from Becerra’s office.
A broad coalition representing medical providers last month sent a letter of opposition to Jim Wood, D - Santa Rosa, chair of the Assembly Health Committee.
“A provider must demonstrate that the acquisition or affiliation will result in clinical integration or an increase in access and availability of services to an underserved population, but SB 977 provides no clarity on how a provider may do so,” the letter states. “The ability to regulate anti-competitive behavior is already governed by the Attorney General’s current review authority, as well as federal and state antitrust laws. This proposal would place the burden on all health care providers to meet arbitrary standards of proof, with no right to a hearing or meaningful appeal process.”
SB 977 is next scheduled to go before the Assembly Appropriations Committee.
Emerson-Shea noted that even before the pandemic, 40% of California hospitals were operating in the red, and consolidation has allowed them to continue providing care in underserved areas. Near Mendocino, the only hospital within 60 miles almost closed last year but was able to stay open after affiliating, Emerson-Shea said.
“We need to make sure that communities across our state have access to hospital services,” Emerson-Shea said. “We may see some hospitals having to close their doors because the ability of them to affiliate could be at risk.”