A bill that would give HHS' inspector general's office oversight authority over the sales of not-for-profit hospitals to investor-owned chains was introduced last week by Rep. Fortney "Pete" Stark (D-Calif.).
As expected, the bill would give the agency the responsibility of determining whether a for-profit paid fair market value for any tax-exempt entity it acquires (Dec. 16, 1996, p. 4).
The agency also would review any management contracts or payments made to executives at the acquired organization to ensure the payments were not excessive.
In order to make that determination, for-profit buyers would have to disclose to the government the financial terms of their proposed acquisitions. The information would also be available to the public. The bill has six co-sponsors, all Democrats.