Hospital Sale Bill Fails on Assembly Floor

The Assembly yesterday rejected a proposal to allow the state attorney general’s office to alter the terms of some hospital sales approved with improper information.

SB 1094 by Sen. Ricardo Lara (D-Long Beach) failed on a 23-24 Assembly floor vote.

Sales of not-for-profit health facilities must be approved by the attorney general’s office. Lara’s bill, which was procedurally granted reconsideration at a later time, would have authorized the AG “to enforce conditions imposed on the approval of an agreement or transaction, and to require the transferee to fulfill all representations made during the application process.”

That means, for instance, if a not-for-profit hospital sale included assurances that reproductive rights would be honored, or that union representation would be carried over to the new administration, the AG would have the right to revisit the sale contract if those assurances aren’t met, said Assembly member Chris Holden (D-Pasadena), who brought the bill before the Assembly yesterday.

“This bill will ensure that adequate protections are in place to protect the community, and to ensure access to critical health services is not diminished,” Holden said.

“The bottom line here is if the public or the attorney general is given misinformation, this is about protecting the interests of the consumer,” Holden said.

“You hear this is all about access to health care,” said Assembly member Don Wagner (R-Irvine). “But we all know that’s a smoke screen. This is all about access to abortion.”

Wagner said there was no compelling reason to pass this bill, since there’s no outstanding problem that needs to be fixed, and said the retroactive power to change sale contracts would be costly to hospitals, consumers and the state.

Assembly member Joan Buchanan (D-Alamo) was not swayed by Wagner’s abortion argument, but she did have other objections to the bill.

“I have struggled with this bill,” she said. “I am a longtime supporter of Planned Parenthood and a major supporter of women’s reproductive rights, and if this bill were limited to that issue, I would be supporting the bill.”

She said contracts that are reviewed and agreed upon should not be revisited later.

“The reality is, the Attorney General [now] has adequate time to review the sales agreements,” Buchanan said. “But this bill gives the Attorney General the right — for 10 years after the sale of a hospital — to change the terms and conditions. When we enter into contracts, we agree to live by those terms. If a hospital breaches that contract, there are remedies in place now to address that.”

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