2026 -- H 7172

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LC004043

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2026

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A N   A C T

RELATING TO HEALTH AND SAFETY -- HEALTH CARE AND SOCIAL SERVICES

TRANSACTION REVIEW AND SIGNIFICANT EQUITY INVESTOR DISCLOSURE ACT

     Introduced By: Representatives Casimiro, Giraldo, Donovan, Read, Spears, Shallcross
Smith, Potter, and Hopkins

     Date Introduced: January 21, 2026

     Referred To: House Corporations

     It is enacted by the General Assembly as follows:

     SECTION 1. Legislative findings.

     The general assembly finds that:

     (1) Private equity and similar investment structures increasingly own or control entities

delivering health care and essential social services in this state;

     (2) Certain transactions involving changes in ownership or control may materially affect

cost, access, quality, workforce stability, and continuity of care or services; and

     (3) Transparency regarding ownership, governance, and financial structure is necessary to

protect the public interest.

     SECTION 2. Title 23 of the General Laws entitled "HEALTH AND SAFETY" is hereby

amended by adding thereto the following chapter:

CHAPTER 17.31

HEALTH CARE AND SOCIAL SERVICES TRANSACTION REVIEW AND SIGNIFICANT

EQUITY INVESTOR DISCLOSURE ACT

     23-17.31-1. Short title.

     This chapter shall be known and may be cited as the “Health Care and Social Services

Transaction Review and Significant Equity Investor Disclosure Act.”

     23-17.31-2. Definitions.

     As used in this chapter:

     (1) “Control” means the power, directly or indirectly, to direct or cause the direction of the

management or policies of an entity, whether through ownership of voting securities, contract,

governance rights, management agreement, or otherwise.

     (2) “Covered care entity” means any of the following operating in this state:

     (i) A healthcare facility or healthcare provider licensed, certified, or registered by the

department of health pursuant to title 23;

     (ii) A behavioral health organization, residential facility, program, or provider licensed,

certified, or funded by the department of behavioral healthcare, developmental disabilities, and

hospitals pursuant to title 40.1; or

     (iii) A residential facility, group home, residential treatment facility, or program licensed,

certified, or approved by the department of children, youth, and families pursuant to title 42.

     (3) “Management services organization” or “MSO” means an entity that provides

management, administrative, financial, or operational services to a covered care entity or provider

organization for compensation.

     (4) “Material change” means any merger, acquisition, consolidation, affiliation, purchase,

sale, transfer of assets, change in ownership, change in control, or other transaction that results in:

     (i) A change of ownership or control of a covered care entity; or

     (ii) A transaction involving a significant equity investor that affects ownership,

governance, or control of a covered care entity, provider organization, or MSO.

     (5) “Private equity company” means any company or group of related entities that raises

or manages capital and acquires, directly or indirectly, an ownership interest in a covered care

entity, provider organization, or MSO for the purpose of investment or financial return, including

through affiliated funds or holding companies; provided, however, that this term shall not include

venture capital firms exclusively funding startups or other early-stage businesses.

     (6) “Provider organization” means any corporation, partnership, limited liability company,

association, or other entity that contracts with, employs, manages, or organizes one or more covered

care entities.

     (7) “Significant equity investor” means:

     (i) Any private equity company with a direct or indirect ownership interest in a covered

care entity, provider organization, or MSO; or

     (ii) Any investor or group of investors that holds, directly or indirectly, ten percent (10%)

or more of the equity, profits, or governance rights of a covered care entity, provider organization,

or MSO.

     23-17.31-3. Notice of material change.

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     (a) Except as provided in § 23-17.31-7, a party to a material change involving a covered

care entity shall file written notice with the department of health and the department of attorney

general not less than sixty (60) days prior to the effective date of the material change.

     (b) The notice shall include:

     (1) Identification of all parties and controlling persons or entities;

     (2) A description of the transaction structure and related agreements;

     (3) Post-transaction ownership, management, and governance structure; and

     (4) Identification of any significant equity investor.

     (c) Filing under this section shall not constitute approval unless approval is otherwise

required by law.

     23-17.31-4. Enhanced disclosures for significant equity investor transactions.

     (a) For any material change involving a significant equity investor, the department of

health, in consultation with the department of attorney general and the applicable licensing agency,

may require submission of additional information including, but not limited to:

     (1) Capital structure of the significant equity investor;

     (2) Ownership and management structure;

     (3) Sources and uses of transaction financing;

     (4) Audited financial statements or equivalent financial information; and

     (5) Management services, lease, or related-party agreements.

     (b) The departments may require periodic post-transaction reporting for a period not to

exceed five (5) years to assess impacts on service availability, cost, workforce stability, and

continuity of care.

     23-17.31-5. Confidentiality.

     Confidential commercial or financial information submitted pursuant to this chapter shall

be protected from public disclosure to the extent permitted by law; provided, however, that a public

summary may be issued that omits such information.

     23-17.31-6. Enforcement.

     (a) Failure to comply with this chapter shall be subject to a civil penalty not to exceed ten

thousand dollars ($10,000) per day, enforceable by the attorney general.

     (b) The department of health may promulgate rules and regulations in consultation with

other affected state agencies.

     23-17.31-7. Coordination with existing law.

     (a) Nothing in this chapter shall be construed to modify, limit, or supersede chapter 17.14

of title 23 (“the hospital conversions act”), which shall control where applicable.

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     (b) Compliance with any healthcare pre-merger notification rule and regulation adopted by

the department of attorney general shall satisfy the notice requirements of this chapter to the extent

the same information is required.

     (c) The department of health, the department of attorney general, and any other licensing

agency may permit concurrent filings and shall deem compliance with duplicative statutory or

regulatory requirements satisfied.

     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO HEALTH AND SAFETY -- HEALTH CARE AND SOCIAL SERVICES

TRANSACTION REVIEW AND SIGNIFICANT EQUITY INVESTOR DISCLOSURE ACT

***

     This act would create and establish the health care and social services transaction review

and significant equity investor disclosure act to require advance notice and enhanced disclosure of

material changes involving significant equity investors to existing state licensing and approval

authorities.

     This act would take effect upon passage.

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