Attorneys general in more than 30 states are hearing a not-for-profit group's cries for oversight of investor-owned healthcare acquisitions of not-for-profits.
Linda Miller, president of Volunteer Trustees of Not-for-Profit Hospitals, which represents 180 tax-exempt facilities, recently had the ear of the National Association of Attorneys General and the National Association of State Charity Officers. Both groups oversee healthcare business deals and charitable divisions in offices of attorneys general.
"There's major interest from the attorneys general because this issue is of major significance," Miller said. "These conversions amount to the largest redeployment of charitable assets in U.S. history."
In an assembly in Williamsburg, Va., late last month, Miller's group offered the attorneys general guidelines to ensure these conversions "protect the public interest."
"For the most part, these transactions are unsupervised and they are paving new ground," Miller said. "They are defining public policy by virtue of their numbers and speed alone."
Volunteer Trustees suggested the attorneys general hold public hearings for community comment. It also suggested independent organizations be called in to review sales and that states require disclosure statements be submitted by not-for-profit officers involved in sales.
Most recently, Volunteer Trustees called for an Internal Revenue Service investigation of a proposed 50-50 ownership deal between Cleveland-based Sisters of Charity of St. Augustine Health System, which owns four hospitals, and investor-owned giant Columbia/HCA Healthcare Corp. of Nashville, Tenn. (June 26, p. 10).
Volunteer Trustees has been largely dismissed by investor-owned chains, which contend they are becoming valuable assets to the communities they serve. For-profits also have said they provide as much charity care as not-for-profits (May 8, p. 28).
But some attorneys general say they expect healthcare conversions will be looked at more closely in the future.
"Now it's hard to find a state not faced with some type of conversion with a hospital or health maintenance organization," said Oregon Assistant Attorney General Ross Laybourne.