HK Navigator: Mapping Healthcare Transaction Laws Holland & Knight Healthcare Transaction Laws Map

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Healthcare providers involved in a covered transaction must provide 30 days written notice to the attorney general. Applies to two or more healthcare facilities or provider organizations not previously under common ownership or contracting affiliation. Effective since Jan. 1, 2024/Currently Effective

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HK Navigator: Mapping Healthcare Transaction Laws

State and federal scrutiny of healthcare transactions is heating up, particularly where private equity sponsors are involved. The map below summarizes the scope and applicability of state laws requiring pre-closing notice and/or approval of certain healthcare transactions, often via extensive filings. Click on the blue-shaded states for a summary, including each law’s potential applicability to transactions involving Management Services Organizations (MSOs) and Dental Support Organizations (DSOs). For more detailed analyses of these and similar laws and emerging issues, see our thought leadership linked at the bottom of this page and consult our team of Holland & Knight attorneys. For the latest on related federal antitrust developments, please also visit the Holland & Knight Antitrust Blog.

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Broad Applicability

Narrow Applicability

No Current Legislation

Requirement: 90 days' pre-closing notice to California Office of Health Care Affordability (OHCA). Applicable to: Mergers, acquisitions, affiliations or other agreements impacting provision of healthcare services, involving healthcare entities that meet certain asset-valuation thresholds or thresholds for California-derived revenue in California. The definitions of “healthcare entities” and “material transactions” are broad and require close study, but there are some exemptions, including for transactions already subject to review by other California agencies. Private Equity Focus?: None stated, but there have been unsuccessful attempts by California to have the California Attorney General review private equity transactions in the healthcare industry. For additional information, see AB 3129, as well as our previous publications, “Navigating Scrutiny of Friendly Professional Corporations in California,” “New Bill Would Empower California AG to Curtail Healthcare Private Equity Transactions” and “Private Equity Healthcare Transactions Under Scrutiny.” MSO & DSO Applicability: MSOs: Yes. MSOs engaging in transactions with covered healthcare entities, or acquiring the non-clinical assets of a medical practice, may be subject to the notice and approval requirements. DSOs: Likely no. Dental providers and DSOs are not currently covered healthcare entities and OHCA guidance affirms that interpretation. Estimated Review Period: 90 days, unless OHCA determines a cost and market review is necessary (which could delay closing up to eight months or longer). Citations: Cal. Code Regs. tit. 22 §97435 Forms: The website directs you to send in notice to CMIR@hcai.ca.gov. Filed Transactions: Accessible here.

California

Requirement: 30 days' pre-closing notice to Connecticut Attorney General; 30 days' post-closing, notice to Office of Health Strategy. Applicable to: Mergers, acquisitions and certain other affiliations by or between physician group practices (that will increase in size to eight or more physicians post-closing), hospitals and hospital systems. Private Equity Focus?: None stated. MSO & DSO Applicability: No. Estimated Review Period: Not specified. Citations: Conn. Gen. Stat. § 19a-486i Forms: Accessible here; email notice to AG.PhysicianAcquisitions@ct.gov. Filed Transactions: Not published.

Connecticut

Requirement: 30 days' pre-closing notice to Illinois Attorney General. Applicable to: Mergers and acquisitions between 1) two or more Illinois healthcare facilities or provider organizations, or 2) an Illinois healthcare entity and an out-of-state healthcare entity that generates at least $10 million in annual revenue from Illinois residents. Private Equity Focus?: None stated. MSO & DSO Applicability: Potentially. Certain MSOs that represent more than 20 healthcare providers in contracting with insurance companies could be provider organizations subject to the notice requirements. The definition of “represent” is unclear, and DSOs are not expressly covered. Estimated Review Period: 30 days, but the Attorney General may request additional information potentially extending that timeline. Citations: 740 Ill. Comp. Stat. 10/7.2a. Forms: Accessible here. Filed Transactions: Not published.

Illinois

Requirement: 90 days' pre-closing notice to Indiana Attorney General. Applicable to: Mergers and acquisitions between broadly defined “healthcare entities” where at least one entity is an Indiana healthcare entity and both entities have at least $10 million in total assets. See Indiana AG Statement. Private Equity Focus?: Yes, the definition of healthcare entity includes private equity partnerships merging with or acquiring healthcare entities.. Recently, Senator Mike Braun, a gubernatorial candidate, released a healthcare plan for Indiana that included a proposal to subject all private equity mergers and acquisitions in the healthcare industry to approval by the Indiana Attorney General. See Indiana Capital Chronicle. MSO & DSO Applicability: Potentially, if the MSO or DSO is controlled or owned by a private equity entity and acquires non-clinical assets of the healthcare entity. Estimated Review Period: 90 days. Citations: Ind. Code §25-1-8.5-4 Forms: No specific form; statute sets forth notice requirements. Filed Transactions: Not published.

Indiana

Requirement: 60 days’ pre-closing notice to Massachusetts Attorney General, Center for Health Information and Analysis, and Health Policy Commission. Applicable to: Mergers, acquisitions or certain affiliations of and between healthcare providers and provider organizations that had at least $25 million in net patient revenue in the preceding fiscal year. Private Equity Focus?: Not currently, but prior proposed legislation would add a focus on private equity. MSO & DSO Applicability: Potentially. MSOs and DSOs that represent one or more healthcare providers in contracting with payers could be provider organizations subject to the notice requirements. Estimated Review Period: 30 days, unless a cost and market impact review is initiated, which may extend review by up to 215 days. Citations: Mass. Gen. Laws Ch. 6D § 13 and 958 CMR 7.00 Forms: Accessible here. Filed Transactions: Accessible here.

Massachusetts

Requirement: 60 days' pre-closing notice to Health Economics Program for entities with more than $80 million in revenue; 30 days' pre-closing notice to Minnesota Department of Health for entities with $10 million to $80 million in revenue. Applicable to: A single transaction or series of transactions involving certain Minnesota healthcare entities (including physician, physician assistant and advanced practice registered nurse (APRN) group practices) where one entity has at least $10 million in annual revenue. Private Equity Focus?: None stated. MSO & DSO Applicability: MSOs: Potentially, if the MSO 1) has power to control the management and policies of a healthcare entity or 2) shares in more than 40 percent of the revenue of the healthcare entity. DSOs: No. Dental providers and DSOs are not currently covered healthcare entities. Estimated Review Period: 30 to 60 days. Citations: Minn. Stat. §§ 145D.01, 145D.02 Forms: HEP Notice accessible here; MDH Notice accessible here. Filed Transactions: Not published.

Minnesota

Requirement: 30 days' pre-closing notice to Nevada Attorney General plus, for certain physician group practice transactions, 60 days' pre-closing notice to Nevada Department of Health and Human Services (DHHS). Applicable to: Mergers, acquisitions or affiliations of or between healthcare group practices that constitute a significant percentage of providers of a single specialty within a Nevada geographic market. Private Equity Focus?: None stated. MSO & DSO Applicability: No. Estimated Review Period: 30 to 60 days. Citations: Nev. Rev. Stat. § 598A.290 et seq. and Nev. Rev. Stat. § 439A.126 Forms: Attorney General Notice accessible here; email to HSRand30dayHealthNotices@ag.nv.gov; DHHS Notice accessible here. Filed Transactions: Not published.

Nevada

Requirement: 30 days' pre-closing notice to New York Department of Health. Applicable to: A single transaction or series of transactions (during rolling 12-month period) that will result in a healthcare entity increasing its total gross in-state revenue by $25 million or more. Private Equity Focus?: None stated, but the legislative history suggests a focus on private equity transactions involving physician practices that historically were not reviewed by New York state agencies. MSO & DSO Applicability: MSOs: Yes, the definition of healthcare entity includes MSOs. DSOs: Likely no. Dental providers and DSOs are not expressly covered healthcare entities. Estimated Review Period: 30 days. Citations: N.Y. Pub. Health Law § 4550 et seq Forms: No specific form; statute sets forth notice requirements. Email notice to MaterialTransactionDisclosure@health.ny.gov. Filed Transactions: Accessible here.

New York

Requirement: 180 days' pre-closing notice to Oregon Health Authority (OHA), but, in practice, many transactions with tighter timelines submit 30 days pre-closing. OHA must approve the transaction, and OHA may add conditions on the transaction if or when it approves. Applicable to: Certain transactions involving healthcare entities, including partnerships or affiliations that will eliminate or significantly reduce services available to patient populations. At least one healthcare entity must have at least $25 million in average revenue for each of the previous three years, and the other party to the transaction must have at least $10 million in average revenue for previous three years (or $10 million in anticipated revenue during first year, if new entity). Transactions involving out-of-state entities are reportable if they will increase cost or limit access in Oregon. Oregon broadly defines “healthcare entity.” Private Equity Focus?: Yes. Oregon recently issued guidance clarifying that private equity firms that own 25 percent or more of a healthcare entity may be subject to the notice and review requirements. MSO & DSO Applicability: Yes. Oregon defines “acquisition” to include undertaking to provide “comprehensive management services,” and Oregon recently issued guidance clarifying that MSOs and DSOs may be subject to the notice and review requirements. Estimated Review Period: 30 days, unless OHA determines a comprehensive review is needed, in which case, review may be extended for 180 days or more. Citations: Or. Rev. Stat. § 415.500 et seq. and Or. Admin. R. 409-070-0000 - 0085 Forms: Accessible here. Filed Transactions: Accessible here.

Oregon

Requirement: 60 days' pre-closing notice to Washington Attorney General. Applicable to: Mergers, acquisitions or contracting affiliations between a provider organization, hospital or hospital system operating within Washington. Out-of-state entities that generate $10 million or more in healthcare services from patients residing in Washington also must file. Private Equity Focus?: None stated. MSO & DSO Applicability: Potentially. MSOs and DSOs that represent at least seven healthcare providers in contracting with payers could be provider organizations subject to the notice requirements. Estimated Review Period: 60 days. Citations: Wash. Rev. Code § 19.390 et seq. Forms: Accessible here. Filed Transactions: Not published.

Washington

This map identifies state laws that have been enacted or proposed in connection with increased scrutiny by states of healthcare transactions. Other long-standing transaction review requirements found in state licensure, not-for-profit, insurance and risk bearing organizations, certificate of need and hospital laws are not displayed here. In addition, other states have proposed similar legislation that failed to pass and/or is currently pending in the respective legislatures. This page is current as of Oct. 1, 2024. For the latest information on emerging issues and new developments, please contact our team of Holland & Knight attorneys.

Nashville

PARTNER

615.850.8927

doug.wolford@hklaw.com

Doug Wolford

Nashville

PARTNER

615.850.8647

morgan.ivey@hklaw.com

Morgan L. Ivey

Chicago

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312.715.5889

john.saran@hklaw.com

John C. Saran

Primary Contacts

Requirement: Pre-closing notice (number of days not specified) to the New Mexico Office of Superintendent of Insurance (OSI). OSI will either approve, approve with conditions, or disapprove each transaction. The law and its regulations are scheduled to auto-repeal on July 1, 2025. Applicable to: (i) Acquisitions or mergers of New Mexico hospitals, or (ii) contracting affiliations between a New Mexico hospital and an MSO or health insurer, resulting in a change of control of the hospital. Control includes the power to direct or cause direction of the management and policies of hospital via contract. Parties may request a pre-notice conference with the OSI to determine whether a proposed transaction will be subject to the law. Private Equity Focus?: None stated. MSO & DSO Applicability: MSOs: Yes, if the MSO controls and provides all or substantially all of the administrative, management, and policies for the hospital, including administration of contracts with health plans, TPAs, and PBMs, on behalf of the hospital. DSOs: N/A Estimated Review Period: 120 days. Citations: N.M. Code Ann. 59A-63-3 et seq.; N.M. Admin. Code 13.2.12.1 et seq. Forms: Accessible here. Submit to OSI.Consolidation@state.nm.us. Filed Transactions: Not published.

New Mexico