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On July 31, the Department of Health Care Access and Information (HCAI) published draft regulations to implement new requirements for hospitals and other health care entities to notify HCAI’s Office of Health Care Affordability (OHCA) prior to engaging in certain transactions, including mergers, acquisitions, and affiliations.
The draft regulations address the timing and content of the required notices, the types of transactions requiring notice, and OHCA’s process for completing its Cost and Market Impact Reviews of the transactions.
These regulations will apply to transactions involving hospitals, other facilities, physician organizations, clinics, ambulatory surgery centers, labs, imaging centers, payers, and other entities. It will not apply to transactions for which hospitals must obtain attorney general approval unless a special referral is made.
CHA anticipates that complying with the draft regulations will be time-consuming and expensive, and for this reason may result in a chilling effect on hospital transactions. However, OHCA does not have the ability to deny transactions — its role is limited to issuing a public report on each transaction.
CHA will hold a Zoom meeting on Aug. 14 at 3 p.m. (PT) to hear hospitals’ concerns about the draft regulations prior to submitting comments to HCAI. Please contact Lois Richardson at lrichardson@calhospital.org if you wish to participate.
HCAI will hold a public meeting (“workshop”) on Aug. 15 virtually and in-person to take comments on the draft regulations. Written comments are due to HCAI by Aug. 31.
