Lobbyists Weaken California Bill To Stop Private Equity Control Of Hospitals

A bill introduced in the California Legislature in February had a simple but significant goal: to force scrutiny of private equity investors as they increasingly encroach on the state’s healthcare industry.

Assembly Bill 129 would have given Bonta’s office wide latitude to stop or place conditions on the kinds of private equity takeovers that the AG feared would worsen health care in the state. I Photo: Health Services Los Angeles County

Given private equity’s history of often disastrous outcomes in the health care field, both in patient care and cost, such legislation was reasonable, Mark Kreidler reported for Capital & Main.

The bill, as originally written by Assemblyman Jim Wood (D-Healdsburg) and supported by state Attorney General (AG) Rob Bonta, would have given Bonta’s office wide latitude to stop or place conditions on the kinds of private equity takeovers that the AG feared would worsen health care in the state.

Six months later, Assembly Bill 3129 is still alive—but substantially weakened. It may yet pass, and its implementation would still apply to many healthcare settings.

But some of the industry’s biggest power players won’t be affected by it, including for-profit hospitals, because they’ve been made exempt.

This is a measure rooted in concern about what private equity is doing to Californians’ ability to receive adequate care without facing astronomical bills. In the end, though, AB 3129 appears to be falling victim to the usual suspects: money, influence, and lobbying power.