Legislature Moves to Track Healthcare Consolidations
Healthcare Transactions attorney John Saran was interviewed by Law Week Colorado about Senate Bill (SB) 26-041, which would increase oversight of mergers, acquisitions, consolidations and other types of deals in the state's healthcare industry by imposing transaction reporting requirements. The bill would obligate parties involved in a deal to notify the state attorney general (AG) 60 days prior to closing, with the intent of allowing regulators to review the deal's implications. Mr. Saran situated the proposal within national trends, as state legislators from Maine to Arizona have proposed laws on transaction reporting, corporate practice of medicine and healthcare consolidations. He explained that the Colorado bill not only attempts to bridge the gap with federal oversight – the Hart-Scott-Rodino Act applies only to the largest transactions – but also covers a wider range of organizations, including hospitals, ambulatory surgery centers, behavioral health facilities and even pharmacy benefit managers.
"Colorado wants to see the full picture," he explained, adding that the bill includes "actual teeth" through an enforcement provision allowing the attorney general to seek injunctive relief for noncompliance.
Mr. Saran additionally warned about some of the practical effects of the bill, such as holding up national transactions and thus dissuading investors or inundating the AG's office with paperwork given the number of providers captured. Ultimately, he concluded, success in this field will entail finding a balance between maintaining access, quality of care and affordability without creating onerous obligations.
"If done well, this can give the state meaningful insight while maintaining a functional market," he stated.