BILL NUMBER: S8987A
SPONSOR: RIVERA
 
TITLE OF BILL:
An act to amend the public health law, in relation to hospital estab-
lishment
 
PURPOSE OR GENERAL IDEA OF BILL:
To ensure that individuals or entities with decision-making power
regarding the operation of a hospital are subject to approval for estab-
lishment by the Public Health and Health Planning Council. Outlines
detailed criteria and exceptions for such approval, emphasizing the
importance of regulatory oversight in maintaining the quality and integ-
rity of health care facilities.
 
SUMMARY OF SPECIFIC PROVISIONS:
Section 1 amends subdivision 1 of section 2801-a of the public health
law as it relates to the establishment of incorporation of hospitals, to
include new subdivisions new (b), (c), and (d). It would specify that a
person, partnership, company, stockholder, member, corporation or other
entity would be deemed to have authority to operate a hospital if they
have or share the decision-making authority over any of the following
items listed in new subdivision (c). Requires such person or entity to
obtain establishment approval by the Public Health and Health Planning
Council and outlines that any assignment or delegation of operational
authority is subject to establishment approval, except for an assignment
or delegation to a committee, corporate officer, or an employee of the
hospital or a management contract for day-to-day operations of a hospi-
tal and such contract would require the written approval of the Commis-
sioner of Health (COH) before taking effect.
Section 2 sets an effective date.
 
JUSTIFICATION:
The proposed amendments to the Public Health Law represent a critical
step towards guaranteeing complete monitoring and responsibility in the
development and operation of hospitals. Currently, the law requires
consent from the Public Health and Health Planning Council (PHHPC)
before establishing or changing ownership of a hospital, ensuring a
thorough review of public need. However, there is a lack of monitoring
for corporate entities that exercise "passive" control over hospitals,
rather than directly engaging in day-to-day operational choices.
These "passive" corporate arrangements have increasingly played a role
in hospital mergers, networks, and affiliations, often resulting in the
reduction or elimination of vital healthcare services within communi-
ties. Without explicit inclusion in the establishment approval process,
these arrangements operate without the necessary scrutiny regarding
their impact on public health.
By clarifying the definitions of operational authority over a hospital
to encompass "passive" control corporate models, this bill seeks to
address this regulatory gap. Under the proposed revisions, entities
exercising such control would be required to get PHHPC establishment
permission. This ensures that all arrangements influencing hospital
operations, whether direct or indirect, are thoroughly reviewed to
protect the provision of healthcare services in communities.
Furthermore, by subjecting these arrangements to institution approval,
the measure fosters transparency and accountability in healthcare gover-
nance. It connects regulatory monitoring with the changing landscape of
hospital ownership and management structures, instilling greater trust
in the integrity of healthcare delivery systems.
In essence, the amendments proposed in this bill uphold the fundamental
principle that access to quality healthcare is a cornerstone of public
welfare. By extending establishment approval requirements to include
"passive" control corporate models, the legislation reinforces the
commitment to protect and promote the health and well-being of all indi-
viduals and communities across the state.
 
PRIOR LEGISLATIVE HISTORY:
New Bill.
 
FISCAL IMPLICATIONS:
None.
 
EFFECTIVE DATE:
This act shall take effect immediately but only applies prospective to
new submissions to PHHPC.