Substitute Senate Bill No. 1507 seeks to prohibit private equity ownership and control of hospitals and health systems, effective July 1, 2025. The bill explicitly states that no private equity company or real estate investment trust (REIT) may acquire or increase any direct or indirect ownership interest or operational control over these healthcare entities. It also introduces definitions for key terms such as "health system," "hospital," "ownership interest," and "operational control," while establishing the concept of "indirect ownership interest." Additionally, the bill restricts healthcare facilities and management services organizations from interfering with the clinical decisions of healthcare providers, including advanced practice registered nurses and physicians, rendering any agreements that violate this provision void and unenforceable.

Moreover, the bill mandates the Office of Health Strategy to assess the potential for the Attorney General to petition for the appointment of a receiver to manage hospitals in financial distress, with a report due by October 1, 2026. It also includes provisions that make any policy or contract related to nursing homes void if it violates the bill's stipulations, effective July 1, 2025, and requires courts to award reasonable attorney's fees and costs to plaintiffs in such cases. The fiscal impact of the bill is estimated to cost the General Fund approximately $164,000 in FY 26 and $211,900 in FY 27, primarily due to the need for additional personnel in the Department of Public Health to manage increased case volumes related to interference and coercion claims. Overall, the bill aims to enhance public health by safeguarding healthcare providers' clinical autonomy and preventing potentially harmful financial influences from private equity in the healthcare sector.