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sHB5316 / File No. 141 1
General Assembly File No. 141
February Session, 2026 Substitute House Bill No. 5316
House of Representatives, March 24, 2026
The Committee on Banking reported through REP. DOUCETTE
of the 13th Dist., Chairperson of the Committee on the part of
the House, that the substitute bill ought to pass.
AN ACT PROHIBITING REAL ESTATE INVESTMENT TRUSTS FROM
ACQUIRING OR INCREASING OPERATIONAL CONTROL OVER
HOSPITALS OR HEALTH SYSTEMS AND PROHIBITING HOSPITALS
AND HEALTH SYSTEMS FROM ENTERING INTO SALE-LEASEBACK
FINANCING TRANSACTIONS.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. (NEW) (Effective October 1, 2026) (a) As used in this section: 1
(1) "Health system" means (A) a parent corporation of one or more 2
hospitals and any entity affiliated with such parent corporation through 3
ownership, governance, membership or other means, or (B) a hospital 4
or any entity affiliated with such hospital through ownership, 5
governance, membership or other means; 6
(2) "Hospital" has the same meaning as provided in section 19a -646 7
of the general statutes; 8
(3) "Main campus of a hospital" means the licensed premises within 9
which the majority of inpatient beds are located; 10
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(4) "Operational control" means to (A) influence or direct the actions 11
or policies of any part of a hospital or health system, or (B) choose, 12
appoint or terminate a member of the board, manager, managing 13
member, senior employee, consultant or other individual or entity that 14
participates in the operational oversight of a hospital or health system; 15
(5) "Person" has the same meaning as provided in section 1 -79 of the 16
general statutes; 17
(6) "Real estate investment trust" has the same meaning as provided 18
in 26 USC 856, as amended from time to time; and 19
(7) "Sale -leaseback transaction" means a transaction in which a 20
hospital or health system enters into an agreement with another person 21
to sell and lease back hospital or health system-owned real property that 22
constitutes the main campus of a hospital. 23
(b) On and after October 1, 2026, no real estate investment trust shall 24
(1) acquire any operational control over a hospital or health system; or 25
(2) increase any operational control that the real estate investment trust 26
has over a hospital or health system. 27
(c) On and after October 1, 2026, no hospital or health system shall 28
enter into a sale-leaseback transaction. 29
This act shall take effect as follows and shall amend the following
sections:
Section 1 October 1, 2026 New section
Statement of Legislative Commissioners:
In Subsec. (b)(2), "health care system" was changed to "health system"
for consistency with other provisions of the Section.
BA Joint Favorable Subst. -LCO
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The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of
the General Assembly, solely for purposes of information, summarization and explanation and do not
represent the intent of the General Assembly or either chamber thereof for any purpose. In general,
fiscal impacts are based upon a variety of informational sources, including the analyst’s professional
knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final
products do not necessarily reflect an assessment from any specific department.
OFA Fiscal Note
State Impact: None
Municipal Impact: None
Explanation
The bill prohibits: (1) real estate investment trusts from acquiring or
increasing operational control of hospitals and health systems; and (2)
hospitals and health systems from entering sale-leaseback transactions,
resulting in no fiscal impact to the state or municipalities.
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OLR Bill Analysis
sHB 5316
AN ACT PROHIBITING REAL ESTATE INVESTMENT TRUSTS
FROM ACQUIRING OR INCREASING OPERATIONAL CONTROL
OVER HOSPITALS OR HEALTH SYSTEMS AND PROHIBITING
HOSPITALS AND HEALTH SYSTEMS FROM ENTERING INTO
SALE-LEASEBACK FINANCING TRANSACTIONS.
SUMMARY
This bill prohibits, beginning October 1, 2026, real estate investment
trusts (REITs) from acquiring any operational control, or increasing any
operational control they already have, over a hospital or health system
(hospitals or parent corporations of hospitals and their affiliates).
Under the bill, “operational control” is (1) influencing or directing
actions or policies of any part of a hospital or health system or (2)
choosing, appointing, or terminating a person or entity that participates
in the hospital’s or health system’s opera tional oversight (for example,
a board member, senior employee, or consultant). The bill incorporates
the REIT definition from the federal Internal Revenue Code (26 U.S.C. §
856). Subject to various conditions, a REIT is generally a corporation,
trust, or association (other than a financial institution or insurance
company) that owns or finances income-producing real estate.
The bill also prohibits, starting October 1, 2026, hospitals and health
systems from entering into sale -leaseback transactions. These
transactions are agreements for a hospital or health system to sell and
lease back real property comprising a hospital’s main campus.
EFFECTIVE DATE: October 1, 2026
BACKGROUND
Related Bills
sSB 196 (File 48), favorably reported by the Public Health Committee,
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(1) prohibits hospitals from entering into sale -leaseback transactions
and (2) requires hospitals to annually attest that no private equity entity
has a controlling interest in the hospital or may influence policies or
procedures that would interfere with clinicians’ decisions, and that the
hospital license holder has full governance control over its assets and
activities.
HB 5045, favorably reported by the Public Health Committee,
replaces the current health care facility certificate of need (CON)
program with a new one and, among various other changes, generally
requires CON approval for a REIT’s acquisition (in any way) of at least
20% of the assets or operations of a health care entity.
COMMITTEE ACTION
Banking Committee
Joint Favorable
Yea 13 Nay 0 (03/10/2026)