2021 -- S 0007

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LC000544

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2021

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A N   A C T

RELATING TO HEALTH AND SAFETY -- THE HOSPITAL CONVERSION ACT

     Introduced By: Senators Ruggerio, Goodwin, McCaffrey, Miller, Lombardo, Coyne,
Quezada, Kallman, Cano, and Lawson

     Date Introduced: January 12, 2021

     Referred To: Senate Health & Human Services

     It is enacted by the General Assembly as follows:

     SECTION 1. Legislative findings

     (1) The strength of the state's overall hospital network is critical to the wellbeing of all

Rhode Islanders;

     (2) The for-profit hospital model's diverging interests due to its tax status result in a

different approach to care and corporate governance;

     (3) The current financial stability of the for-profit hospital group controlling Fatima and

Roger Williams Hospitals has been publicly called into question;

     (4) Public court filings have alleged that the hospitals are insolvent and that bankruptcy is

possible;

     (5) Financial troubles at Fatima and Roger Williams Hospitals may stem in part from their

status as for-profit institutions, which has allowed the ownership of Fatima and Roger Williams

Hospitals to indebt their national network of hospitals with over a billion dollars in debt while

personally collecting over $500 million in dividends from the hospitals;

     (6) As demonstrated with the closure of Memorial Hospital in Pawtucket, the ramifications

of any potential closures are felt in health centers across the state, potentially overtaxing their ability

to provide necessary health services;

     (7) Rhode Island's hospitals presently bear a significant burden due to the COVID-19

pandemic, and this burden has resulted in the opening of two field hospitals and stretched the

capacities of health care workers;

     (8) As other hospital networks in Rhode Island consider transfers of ownership, it is

essential that the General Assembly, Rhode Island Department of Health, and Rhode Island

Attorney General, and health care regulators thoroughly understand the for-profit hospital model

and its broader impact on our state's healthcare delivery system; and

     (9) A moratorium on approvals of any new for-profit hospitals or transfer of ownership

would grant the General Assembly and regulators the time necessary to conduct a comprehensive

review of for-profit hospital entities and their impact on the financial condition of the hospitals they

operate, other hospitals in the state, and the overall health care system.

     SECTION 2. Chapter 23-17.14 of the General Laws entitled "The Hospital Conversions

Act" is hereby amended by adding thereto the following section:

     23-17.14-36. Moratorium on conversions involving for-profit corporation as acquiree

or acquiror.

     There shall be a one year moratorium imposed on the conversion of any hospital governed

by this act if the acquiree or acquiror is a for-profit corporation.

     SECTION 3. This act shall take effect upon passage and shall expire one year from the

effective date.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO HEALTH AND SAFETY -- THE HOSPITAL CONVERSION ACT

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     This act would provide a one year moratorium on hospital conversions involving for-profit

corporations as acquiree or acquiror.

     This act would take effect upon passage and would expire one year from the effective date.

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