The proposed bill amends the Hospital Conversions Act by introducing a new section that establishes a bond requirement for private equity companies and real estate investment trusts (REITs) that invest in healthcare providers or provider-sponsored organizations (PSOs). Under this legislation, these entities must submit a notice of material change to the Department of Attorney General and deposit a bond with the Department of Health (DOH). The bond amount must equal one year of the provider's or PSO's average or estimated operating expenses, and it must be maintained for the duration of the investment and for seven years thereafter. The DOH is authorized to collect the bond if the provider or PSO declares bankruptcy, is at imminent risk of closure, or closes a majority of essential services. The proceeds from the bond will be used to support the continued provision of healthcare services to patients served by the provider or PSO, with input sought from the public regarding its expenditure.

Additionally, the bill prohibits private equity companies and REITs from interfering with or controlling the clinical decisions made by healthcare practitioners. The DOH is tasked with promulgating regulations necessary to implement this new requirement. This act is set to take effect upon passage.