Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance
committees of the Legislature. LFC does not assume responsibility for the accuracy of these reports if they
are used for other purposes.
F I S C A L I M P A C T R E P O R T
SPONSOR Ferrary/Thomson/Silva/Anaya/Chávez, E.
LAST UPDATED
ORIGINAL DATE 3/4/2025
SHORT TITLE Medical Corporation Accountability Act
BILL
NUMBER House Bill 552
ANALYST Hernandez
ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT*
(dollars in thousands)
Agency/Program
FY25 FY26 FY27
3 Year
Total Cost
Recurring or
Nonrecurring
Fund
Affected
HCA
No fiscal
impact
No fiscal
impact
No fiscal
impact
No fiscal
impact
Parentheses ( ) indicate expenditure decreases.
*Amounts reflect most recent analysis of this legislation.
Sources of Information
LFC Files
Agency Analysis Received From
Health Care Authority (HCA)
NM Hospital Association
SUMMARY
Synopsis of House Bill 552
House Bill 552 (HB552), or the Medical Corporation Accountability Act, requires that any
hospital receiving state or local funding report their ownership status, salary ranges for health
care providers, and total compensation for the chief executive officer to the Health Care
Authority (HCA) annually. HCA must then provide the report to the Legislature. Additionally,
HB552 requires that a private equity fund or hedge fund involved in any matter with a hospital or
health care provider in New Mexico cannot interfere with the professional judgment of a health
care provider.
This bill does not contain an effective date and, as a result, would go into effect 90 days after the
Legislature adjourns if enacted, or June 20, 2025.
FISCAL IMPLICATIONS
HCA notes no fiscal impact for HB552.
Due to the passage of the Healthcare Delivery and Access Act last session, almost every hospital
in the state receives state funding and is therefore covered under HB552.
SIGNIFICANT ISSUES
Private equity firms are increasingly purchasing hospitals both nationally and in New Mexico— House Bill 552 – Page 2
raising concerns about hospital viability and healthcare access more broadly. A report written by
the Private Equity Stakeholder Project highlights that New Mexico has the highest proportion of
hospitals owned by private equity firms in the country, with 38 percent of private hospitals (17
out of 45) owned by private equity firms. The state with the second highest proportion is Idaho
with 23 percent of hospitals being owned by private equity firms. Nationally, between 2009 to
2019, the acquisition values of healthcare related private equity firms were set at $750 billion.
Generally, private-equity-owned hospitals are in lower income, non-urban areas and have fewer
patients discharged, fewer employees per bed, and lower patient experience scores.
Peer-reviewed research, which includes data points from New Mexico, demonstrates that quality
of care and number of patients treated decline when hospitals are owned by private equity firms.
Focusing on hospitals, patients who visit a private-equity-owned hospital are more likely to
experience “hospital-acquired adverse events.” These events include increased falls, central-line-
associated bloodstream infections, surgical site infections, myocardial infarction, and
pneumonia. Financially, when compared to hospitals that are not owned by private equity firms,
private-equity-owned hospitals are likely to charge more per inpatient day, experience higher
cost-to-charge ratios for emergency departments, and higher total cost-to-charge ratios—driving
up costs for patients and state and federal governments.
1
HCA notes concern over Section 4 of HB552, as it:
Outlines prohibitions related to private equity fund or hedge fund involvement with
decisions of health care providers. This section is significantly broad and lacks clarity for
enforcement. As written, the bill includes all health care providers. The Health Care
Authority, specifically the Division of Health Improvement, has regulatory oversight of
health care facilities, but not of individual practitioners or health care providers. Defining
what would be interference of professional judgement and scope of practice would
require input and potentially oversight from the respective clinical boards, such as the
Medical Board, which this bill does not outline.”
The Hospital Association notes:
In [Section 4 of HB552] the definitions of ‘hedge fund’ and ‘private equity fund’ are
problematic because they describe such a wide array of situations which are not private
equity or a hedge fund. As defined, they would include the investment of private
individuals or healthcare providers in a community that seek to create new and needed
access points in our communities.
ADMINISTRATIVE IMPLICATIONS
HCA notes that it would need to promulgate new rules, as well as determine an enforcement
mechanism for failure to report.
AEH/hj/SL2
1
Bruch JD, Gondi S, Song Z. “Changes in Hospital Income, Use, and Quality Associated with Private Equity
Acquisition.” JAMA Internal Medicine. 2020 Aug 24;180(11):1428-1435. Bruch J, Zeltzer D, Song Z.
“Characteristics of Private Equity-Owned Hospitals in 2018.” Annals of Internal Medicine. 2021 Feb;174(2):277-
279.