California Enacts Law to Review More Private Equity Healthcare Acquisitions

Healthcare Transactions attorney John Saran was cited in a Wall Street Journal article on California's latest moves to regulate private equity in healthcare. Assembly Bill (AB) 1415, signed by Gov. Gavin Newsom, will require private equity firms, hedge funds and other investors to submit planned healthcare buyouts for review by the state's Office of Health Care Affordability starting in January, while Senate Bill (SB) 351, signed the prior week, bolsters enforcement against corporate interference in medical decision-making. Mr. Saran noted that although AB 1415 does not grant veto power, it will make deals more burdensome and costly by compelling disclosure of internal financial information and could have national implications given California's market size. He added that California's new review regime is prompting private equity-backed providers to reassess deal timelines and structures, even as other states advance similar oversight measures.

"This certainly does have a national impact," he said.

READ: California Enacts Law to Review More Private Equity Healthcare Acquisitions (Subscription required)