A bill that would strengthen California’s ban on the corporate practice of medicine and address the growing influence of private equity in healthcare has passed out of the state’s legislature and is headed to Gov. Gavin Newsom’s desk for final approval.
According to a Sept. 15 news release by the California Medical Association, the bill expands the powers held by California’s attorney general to take action against corporate entities that interfere with the practice of medicine, including patient care decisions. The measure addressed growing concerns about the impact of private equity ownership in healthcare, which has been connected to higher healthcare costs, reduced access and decreased quality of care.
Mergers and acquisitions by hedge funds and management services organizations may also be more heavily scrutinized if the bill becomes law. The bill would codify existing laws restricting the corporate practice of medicine and restrictive covenant limitations.
