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CEO Message

CEO Message: Amid COVID-19, SB 977 Threatens Health Care Partnerships

This week, California’s Senate will vote on a bill that would give the state Attorney General sweeping power to approve or reject vital business arrangements between hospitals and other health care providers.  

The bill is dangerous because it would vest unprecedented power and authority over these partnerships and relationships with a single office. That will inhibit the development of integrated delivery systems that can buoy financially challenged doctors, keep open hospitals that might otherwise shutter in rural communities and inner-city urban areas, and preserve access to care throughout California. 

Last week, the bill, SB 977, passed a Senate Appropriations Committee procedural step, leading to a floor vote Wednesday or Thursday. That’s where efforts to defeat the bill are now concentrated. In addition to legislators hearing directly from you, an advertorial in the Sacramento Bee is calling their attention to this issue, one that — if not resolved correctly — could limit efficiency and increase costs during a time when the COVID-19 pandemic has proven that systems of care are key to successfully addressing a crisis.   

Also, health care partnerships today are under the rigorous scrutiny of the Federal Trade Commission, and the Attorney General already has the authority to review sales of not-for-profit hospitals. This legislation would go well beyond federal regulation and existing state law, and expand the scope of the state Attorney General’s authority over the affiliation or sale of hospitals, physician practices, ambulatory surgery centers, imaging centers, diagnostic centers, labs, and more. 

Bottom line: this bill would give unprecedented decision-making authority to the Attorney General – and to that office alone – to determine the accessibility and availability of care in California. 

The Attorney General is the bill’s sponsor, so this is as much a political fight as it is a policy debate. That’s why our partners in opposing this legislation – the California Medical Association, the California Chamber of Commerce, and others – are also important. 

If the bill passes the Senate, it will be heard by the Assembly Health Committee in late July, another opportunity to demonstrate how this proposal threatens access to health care and raises costs.  

The COVID-19 pandemic has shown that strong partnerships among providers support an integrated, cooperative response to health care crises. And responding to a crisis is just one reason why we must continue to fight to preserve relationships that support hospitals in caring for all Californians in all ways. 

~ Carmela