The bill amends Chapter 23-17.14 of the General Laws, known as "The Hospital Conversions Act," by introducing a new section titled "Hospital receivership." This section grants the superior court the authority to liquidate the assets and businesses of a hospital, defined as the legal entity licensed as a hospital under Rhode Island law, when it is established that the hospital is mismanaged, in severe financial distress, insolvent, acting illegally, or operating in a manner that endangers patient health and safety. The attorney general or the department of health can initiate this action.

The bill outlines the procedures for appointing a receiver, including the court's general equity jurisdiction to issue orders and appoint a receiver with specified powers and duties. A hearing for the appointment of a permanent receiver must occur within 21 days of the action's commencement, unless extended by the court for good cause. The receiver is authorized to manage the hospital's affairs, sue and defend in court, and handle the hospital's assets, including the authority to sell or dispose of assets as necessary.

Additionally, the bill establishes a process for creditors to file claims against the hospital's assets, with a fixed date for filing claims set by the court. Creditors who fail to file by this date may be barred from participating in the distribution of the hospital's assets. The court retains exclusive jurisdiction over the hospital and its property throughout the receivership process, ensuring the preservation and appropriate distribution of the hospital's assets. This act will take effect upon passage.