OFFICE OF FISCAL ANALYSIS
Legislative Office Building, Room 5200
Hartford, CT 06106 (860) 240-0200
http://www.cga.ct.gov/ofa
sSB-1507
AN ACT PROHIBITING PRIVATE EQUITY OWNERSHIP AND
CONTROL OF HOSPITALS AND HEALTH SYSTEMS AND THE
CONTROLLING OF OR INTERFERENCE WITH THE
PROFESSIONAL JUDGMENT AND CLINICAL DECISIONS OF
CERTAIN HEALTH CARE PROVIDERS AND REQUIRING AN
EVALUATION OF THE APPOINTMENT OF A RECEIVER TO
MANAGE HOSPITALS IN FINAN CIAL DISTRESS.
Primary Analyst: NB 4/8/25
Contributing Analyst(s):
Reviewer: JS
OFA Fiscal Note
State Impact:
Agency Affected Fund-Effect FY 26 $ FY 27 $
Public Health, Dept. GF - Cost 121,300 153,500
State Comptroller - Fringe
Benefits
1
GF - Cost 42,700 58,400
Note: GF=General Fund
Municipal Impact: None
Explanation
This bill, which includes various provisions regarding hospitals,
health systems, and health care practices, results in a cost to the General
Fund of $164,000 in FY 26 and $211,900 in FY 27 and annually thereafter,
as described below. The cost is associated with personnel needs in the
Department of Public Health (DPH) due to Section 2.
Section 1 prohibits private equity companies and real estate
investment trusts from new or increased acquisitions or control of any
1
The fringe benefit costs for most state employees are budgeted centrally in accounts
administered by the Comptroller. The estimated active employee fringe benefit cost
associated with most personnel changes is 40.71% of payroll in FY 26. 2025SB-01507-R000614-FN.DOCX Page 2 of 3
hospital or health system, which results in no fiscal impact to the state.
Section 2 prohibits licensed health care entities and management
services organizations from controlling clinical decisions of a health care
practice or clinician. This results in a cost to DPH of $121,300 in FY 26
and $153,500 in FY 27 (and annually thereafter), with an estimated cost
to the Office of the State Comptroller for associated fringe benefits of
$42,700 in FY 26 and $58,400 in FY 27. FY 26 costs reflect an October 1
start date for all staff.
It is anticipated that this prohibition will result in an increase in case
volume for the Facility Licensing and Investigations Section (FLIS)
regarding interference and coercion claims. To handle this increase,
DPH requires: (1) a part-time (0.5 FTE) Supervising Nurse Consultant,
at an annualized salary of $47,500 (plus $19,300 annualized fringe
benefits); and (2) a full-time Nurse Consultant investigator, at an
annualized cost of $96,000 (plus $39,100 annualized fringe benefits).
These positions will complete essential duties in conducting healthcare
investigations, such as reviewing patient records and facility
documentation as well as interviewing staff and patients. The FLIS
currently has a backlog of approximately 1,000 complaints, making
additional staff necessary to complete investigative work that may
result from this bill.
Other expenses are expected to total $16,500 in FY 26 and $10,000 in
FY 27 in annually and thereafter. This includes a one-time total cost of
$8,400 in FY 26 for laptops and related hardware, and ongoing annual
costs of $10,000 (with partial year costs in FY 26 of $8,100) consisting of:
(1) fleet maintenance costs for one motor vehicle ($4,600) needed to
allow investigations to be conducted at facilities across the state; (2)
mileage reimbursement ($5,000); and (3) $400 for software and general
office supplies.
Section 3 requires the Commissioner of Health Strategy to evaluate
the potential appointment of a receiver to manage hospitals in financial
distress or operational crisis, which results in no fiscal impact. The
duties required by the bill can be accomplished through existing 2025SB-01507-R000614-FN.DOCX Page 3 of 3
resources.
The Out Years
The annualized ongoing fiscal impact identified above would
continue into the future subject to inflation.