AN ACT REQUIRING AN EVALUATION OF THE APPOINTMENT OF A RECEIVER TO MANAGE HOSPITALS IN FINANCIAL DISTRESS OR OPERATIONAL CRISIS.

Plain English Breakdown

The official bill text defines 'financial distress or operational crisis' but only within Section 1 for the purpose of this evaluation; it does not establish a permanent legal definition outside this context.

Study on Appointing Managers for Struggling Hospitals

This law requires state health officials to study whether the Attorney General should be allowed to ask a court to appoint an outside manager for hospitals facing serious money or operation problems.

What This Bill Does

• Defines what counts as a hospital in financial distress or operational crisis based on specific conditions like bankruptcy, unpaid taxes, missed wage payments, or license revocation.
• Requires the Commissioner of Public Health to evaluate if the Attorney General should have the power to ask courts for a receiver appointment.
• Sets a deadline of October 1, 2027, for the Commissioner to submit this evaluation report.
• Directs the final report to be sent to the state legislative committee that handles public health matters.

Who It Names or Affects

• The Commissioner of Public Health
• Hospitals in financial distress or operational crisis as defined by the law
• The Attorney General

Terms To Know

Receiver

A person appointed by a court to take control of and manage an organization, such as a hospital.

Financial distress or operational crisis

Specific situations where a hospital has filed for bankruptcy protection or meets at least three conditions like unpaid taxes, missed wage payments, negative audit opinions, debt defaults, or license revocation.

Limits and Unknowns

• The law only requires an evaluation and report; it does not immediately give the Attorney General power to appoint receivers.
• The text does not state when this new authority would take effect if the study recommends it, as that depends on future action.

Official Summary Text

To require the Commissioner of Public Health to evaluate whether the Attorney General should be authorized to appoint a receiver to manage hospitals in financial distress or operational crisis.

Current Bill Text

House Bill No. 5165

Special Act No. 26-29

AN ACT REQUIRING AN EVALUATION OF THE APPOINTMENT OF
A RECEIVER TO MANAGE HOSPITALS IN FINANCIAL DISTRESS
OR OPERATIONAL CRISIS.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:

Section 1. (Effective from passage) (a) As used in this section, "a hospital
in financial distress or operational crisis" means a hospital that (1) has
filed for bankruptcy protection, or (2) is experiencing three or more of
the following conditions: (A) The hospital has been issued a nega tive
going concern opinion by its independent auditing firm; (B) the hospital
owes fees, taxes or an assessment to one or more public entities and such
fees or taxes are, or such assessment is, not less than one hundred eighty
days past due, provided the hospital has not (i) commenced a
proceeding to contest the payment of such fees, taxes or assessment, or
(ii) been granted an extension of time to pay such fees, taxes or
assessment; (C) the hospital is in default of a mate rial covenant on a
bond contract or similar debt instrument; (D) the hospital has failed to
make a payment of wages, as defined in section 31 -71a of the general
statutes, for two or more consecutive pay periods, provided the amount
of such wages is not in dispute pursuant to section 31-71d of the general
statutes; or (E) the Commissioner of Public Health has revoked the
hospital's license or the Centers for Medicare and Medicaid Services has
revoked the hospital's participating provider status.
House Bill No. 5165

Special Act No. 26-29 2 of 2

(b) The Commissioner of Public Health shall evaluate whether the
Attorney General should be authorized to petition the Superior Court
for the appointment of a receiver to manage a hospital in financial
distress or operational crisis. Not later than October 1, 2027, the
commissioner shall report, in accordance with the provisions of section
11-4a of the general statutes, to the joint standing committee of the
General Assembly having cognizance of matters relating to public
health regarding such evaluation.