California Bill Giving Attorney General Authority to Regulate and Approve or Deny Healthcare Transactions Advances to Floor Vote

King & Spalding

On August 20, 2020, the Committee on Appropriations of the California State Assembly approved sending SB-977 to the Assembly for a final vote, ahead of an August 31, 2020 deadline to send bills to Governor Gavin Newsom. SB-977, titled “Health care system consolidation: Attorney General approval and enforcement,” would grant the California Attorney General (AG) sweeping authority to review, and approve or deny, changes of control and acquisitions of health care facilities and providers. The bill would require health care systems, private equity groups, and hedge funds to provide notice to, and obtain written consent of, the AG prior to any change of control or acquisition of or with a healthcare facility or provider.

The California Hospital Association, California Medical Association, California Dental Association and the California Chamber of Commerce oppose SB-977 as well as several other provider, finance, and business groups. More information on SB-977 may be found here.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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