Here are six things to know about the new bill:
1. The language of the bill, proposed in the state Senate, is similar to the one from last year. It would limit the power of affiliates of private equity companies entering into management agreements or other transactions with physicians and dentists.
2. The new bill, SB 351, does not include the previous bill’s language requiring notice and consent of the state attorney general for certain private equity healthcare transactions.
3. In SB 351, private equity groups or hedge funds “involved in any manner” with a physician or dental practice may not interfere with decision-making by physicians regarding:
- What diagnostic tests are appropriate for treatment of a given condition
- The need for referrals or consultation with another provider
- The overall direction of care needed for patients
- How many patients are seen daily or the number of hours a physician works
4. Private equity groups would also be prohibited from taking control over other aspects of practice management, including:
- The ownership of medical records
- Hiring, selection or termination of physicians and other health professionals
- The parameters of contractual agreements with payers or care providers
- Decisions on coding and billing
- The selection of medical equipment and supplies
5. The bill would also put in place restrictions on clauses in management agreements that explicitly preclude a professional departing from the practice from competing with the practice or from voicing criticism over care quality issues, utilization, ethical or professional challenges or revenue increasing strategies put in place by the private equity group or hedge fund.
6. The bill would apply only to arrangements created after the law is enacted, but it may require that existing contracts are reviewed for compliance with the new law if passed.
