What's happening
This bill expands the definition of who has authority to operate a hospital and requires additional approval for such authority transfers.
Why it matters
Expands who qualifies as having "authority to operate" a hospital. The bill broadens this definition to include any person or entity with decision-making power over key aspects of hospital governance (like hiring management, approving budgets, or making major policy decisions), not just those with formal titles.
Targets indirect or shared control. By including those who “share” authority or have influence over critical decisions, the legislation addresses scenarios where outside entities (such as management companies, investors, or corporate parents) exert substantial control over hospital operations without being the named operator.
Requires state approval for new types of control transfers. Any assignment or delegation of operational authority—unless it's within the hospital’s own governing body or routine management contracts—now needs explicit review and approval by the state’s Public Health and Health Planning Council, closing loopholes for unofficial takeovers or shadow management.
Aims to increase transparency and oversight. By tightening definitions and approval requirements, the bill seeks to make hospital ownership and control more transparent to the public and regulators, potentially reducing risks of mismanagement, conflicts of interest, or dilution of accountability in hospital leadership.
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Who cares
Hospital owners and affiliated entities
Those holding or sharing authority over specified hospital decisions would need Public Health and Health Planning Council establishment approval unless otherwise authorized by law to operate without it.
Hospital governing boards
Assigning or delegating specified operating powers would require council approval, with exceptions for delegation to board committees, corporate officers or hospital employees and for qualifying management contracts.
Hospital management companies
Contracts to manage day-to-day hospital operations, portions or services would require the health commissioner's written approval before taking effect.
Public Health and Health Planning Council
The bill would require the council to review entities with specified decision-making powers, including control over hospital budgets, leadership appointments and operating policies.
Headline styles
Approve Hospital Operators
Plain English, a few words. Used as the page title.
Sponsors
7 Co-sponsors
History
- Ordered to third reading cal.54
- Advanced to third reading cal.37
- Reported
- Referred to health
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
1147
2019-2020 Regular Sessions
IN ASSEMBLY
January 14, 2019
Introduced by M. of A. GOTTFRIED, PAULIN, L. ROSENTHAL, JAFFEE, ABINAN- TI, D'URSO, COLTON -- Multi-Sponsored by -- M. of A. CARROLL, COOK, CYMBROWITZ, DINOWITZ, ENGLEBRIGHT, GLICK, LIFTON, PERRY, SIMON -- read once and referred to the Committee on Health
AN ACT to amend the public health law, in relation to hospital establishment
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subdivision 1 of section 2801-a of the public health law, as amended by section 57 of part A of chapter 58 of the laws of 2010, is amended to read as follows:
1. (a) No hospital, as defined in this article, shall be established except with the written approval of the public health and health planning council. No certificate of incorporation of a business membership or not-for-profit corporation shall hereafter be filed which includes among its corporate purposes or powers the establishment or operation of any hospital, as defined in this article, or the solicitation of contributions for any such purpose, or two or more of such purposes, except with the written approval of the public health and health planning council, and when otherwise required by law of a justice of the supreme court, endorsed on or annexed to the certificate of incorporation. No articles of organization of a limited liability company established pursuant to the New York limited liability company law which includes among its powers or purposes the establishment or operation of any hospital as defined in this article, shall be filed with the department of state except upon the approval of the public health and health planning council.
(b) For the purposes of this subdivision, a person (other than a person acting solely as a member of the governing body of a hospital or an employee of a hospital), partnership, company, stockholder, member, corporation or other entity shall be deemed to have authority to operate
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD03363-01-9
A. 1147 2
a hospital if it has or shares decision-making authority over any of the following:
(i) appointment or dismissal of a hospital's management-level employees or medical staff;
(ii) election or removal of members of the governing board or corporate officers of the hospital;
(iii) approval of the hospital's operating or capital budgets;
(iv) adoption, approval or enforcement of the hospital's operating policies or procedures;
(v) approval of applications for construction or establishment approval filed by or on behalf of the hospital;
(vi) approval of hospital debt necessary to finance the cost of compliance with operational or physical plant standards required by law;
(vii) approval of contracts for management of the hospital or for clinical services at the hospital; and
(viii) approval of settlements of administrative proceedings or litigation to which the hospital is party that exceed the hospital's insurance coverage or coverage by any applicable self-insurance fund.
(c) Any person, partnership, company, stockholder, member, or corporation, or other entity with authority to operate a hospital shall be subject to approval for establishment by the public health and health planning council under this section, unless otherwise authorized by this chapter to operate a hospital without such establishment approval.
(d) Any assignment or delegation of any authority to operate a hospital, as set forth in paragraph (b) of this subdivision shall be subject to approval for establishment by the public health and health planning council under this section, except for:
(i) assignment or delegation by the governing body of the hospital to a committee of the governing body, a corporate officer or an employee of the hospital; or
(ii) a management contract under which a governing body contracts with an entity to manage day-to-day operations of a hospital or a portion or service thereof, provided that such a management contract shall require the written approval of the commissioner before it may take effect.
§ 2. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.