Connecticut lawmakers are currently considering the idea of allowing private for-profit companies to purchase nonprofit community hospitals. During last year’s legislative session, “tempers flared” over a bill that would have made it easier for a private, for-profit hospital company to purchase physician practices from a nonprofit it planned to take over. The bill was vetoed by Governor Malloy, who said it needed further consideration in determining “whether current laws provide safeguards to guard against any perceived or actual threat to the independence of medical decisions made by providers employed by for-profit entities.”
Connecticut is not well versed in for-profit hospitals; as of now, there is only one for-profit hospital in the entire state: Sharon Hospital. However, for some hospitals in Connecticut, for-profit hospitals represent a new way to bring in capital to their facilities. Tenet HealthCare Corporation, a Texas-based for-profit company, is in negotiations with Waterbury Hospital and has also been courted by Bristol Hospital, and Eastern Connecticut Health Network. In addition, most recently, Tenet created a joint medical foundation with Yale New Haven Hospital. With state and federal funds being cut, along with the implementation of the ACA, some believe these strategic partnerships with for-profit institutions are desperately needed.
If for-profit hospitals do partner with non-profit hospitals in the state, the bigger question remains: will the state allow these for-profit entities to employ physicians? As of now, none of the bills before the legislature allow for the corporate practice of medicine.
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