Hospitals and Health Care Facilities

Plain English Breakdown

The bill summary does not provide information about penalties for non-compliance with public meeting requirements.

Tennessee Certificate of Public Advantage Hospital System Board Act

This bill requires hospital systems in Tennessee with certificates of public advantage to have a nine-member board of directors appointed by the governor and confirmed by the general assembly, with specific rules about membership, terms, and public access.

What This Bill Does

• Requires hospital systems to have a nine-member board of directors nominated by the governor and confirmed by joint resolution of the general assembly.
• Prohibits certain individuals from serving on the board, such as employees of hospitals or entities that do business with them.
• Establishes staggered terms for initial members and sets regular meeting requirements for the board.
• Requires public access to all meetings through live streaming and archived videos on the board's website.

Who It Names or Affects

• Hospitals that are part of a certificate of public advantage in Tennessee
• The governor, general assembly, and hospital system boards

Terms To Know

Certificate of Public Advantage

A legal document issued to hospitals or entities involved in cooperative agreements.

Staggered Terms

Different start dates for board members' terms to ensure continuity and prevent all seats from being vacant at once.

Limits and Unknowns

• The bill does not specify what happens if the general assembly fails to confirm appointments.
• It is unclear how existing boards will transition under this new system.

Official Summary Text

This bill requires
two or more hospitals or entities that are parties to a cooperative agreement and have been issued a certificate of public advantage
(a

"
hospital system
")

to
have as the governing body of the hospital system a board of directors that complies with this
bi
ll
.

A hospital system
that
has

an existing board of directors that does not comply with this
bill

must
, within

30 days after the effective date of this
bill
, vacate the existing board of directors and reconstitute the board of directors in a manner that c
omplies with this
bill
.

This bill generally requires the
board of directors of a hospital system
to
consist of nine voting members who are nominated by the governor and
to
be confirmed by joint resolution of the general assembly.
However, the following
exceptions to being confirmed by such a joint resolution applies:



If the general assembly is not in session when initial appointments are made, all initial appointees serve the terms prescribed in
this bill
, unless the appointments are not confirmed during the next regular session of the general assembly following the appointments.



If the general assembly is not in session at the time a member is appointed to fill a vacancy resulting from the expiration of a term, the member whose term has expired serves until a new appointee is confirmed.



If the general assembly is not in session at the time a member is appointed to fill a vacancy not resulting from the expiration of a term, the new appointee serves for the term appointed unless the appointment is not confirmed during the next regular session of the general assembly following the appointment.

This bill requires the
reconstituted board of directors
to
assume responsibility beginning May 1, 2025. The reconstitution of the board of directors has no effect
on any action taken by the board of directors prior to May 1, 2025, unless such action is inconsistent with this part.

If a board of directors is not appointed by May 1, 2025, then the hospital system's certificate of public advantage expires on May 1, 2
025.

PROHIBITED MEMBERS TO A BOARD

This bill prohibits the
following individuals from serving as a member of the board of directors of a hospital system for so long as they hold the office or position:



An employee of a hospital that is a party to the hospital system's cooperative agreement
.


An employee of an entity that contracts to do business with the hospital system or with any hospital that is a party to the hospital system's cooperative agreement
.


A member of a governing body of any hospital that is a party to the hospital system's cooperative agreement
.


A person who has a financial interest in any contract or transaction affecting the interest of the hospital system
.

A violation of such prohibition
subjects the violator to removal by the governo
r, board of directors, or the committee of state legislators appointed pursuant to
this bill as described below
.

TERMS OF BOARD MEMBERS

This bill staggers the initial terms
of service for members on the board of directors appointed by the
governor.
Fol
lowing the expiration of the initial terms, the term for all members appointed to serve on the board of directors is three years, beginning on May 1 of the year of appointment and ending on April 30 three years later.

Members appointed are
generally
elig
ible to serve multiple terms and succeed themselves
. However, a
person m
ust not
serve more than two consecutive terms, whether appointed as an initial member, as a successor member, or to fill a vacancy. A member who serves two consecutive terms may be r
eappointed after two years have elapsed since the individual's last date of service on the board.

If a vacancy on a board of directors occurs by death or resignation,
this bill provides that
a successor
must be
appointed for the remainder of the term
.
I
f a vacancy occurs by reason of expiration of a term, then the member whose term has expired serve
s
until a successor is appointed and confirmed.

MEETINGS

This bill authorizes t
he governor

to call the initial meeting of the reconstituted board of direct
ors to occur on or after May 1, 2025.

The board
must
hold at least one stated meeting annually on a day or days determined by the board from year to year and at called meetings that may be necessary, to be called by the board or to be called by a legislat
ive committee, upon at least five days' notice to the board members.

This bill requires the
governor
to
appoint a committee of members of the senate and house of representatives that is authorized, by majority vote, to call a meeting of the board of dire
ctors. The committee must only be composed of members of the senate and house of representatives that represent a county or portion of a county where the hospital system is located.

This bill provides that f
ive members of the board of directors constit
ute a quorum for the purpose of transacting business
and that a
ll meetings of the board must be made available for viewing by the public over the internet by streaming video accessible from the board's website. Archived videos of the board's meetings
must

also be available to the public through the board's website.

This bill provides that the
failure of a member to attend at least 50% of the regular meetings in a calendar year is cause for the member's removal and authorizes the presiding officer of the
board to call on the governor to appoint a successor.

Current Bill Text

<BillNo> <Sponsor>

HOUSE BILL 1167
By Hawk

HB1167
000021
- 1 -

AN ACT to amend Tennessee Code Annotated, Title 4;
Title 8; Title 56; Title 63 and Title 68, relative to
certificates of public advantage.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Title 68, Chapter 11, Part 13, is amended by
adding the following as a new section:
(a) As used in this section, "hospital system" means two (2) or more hospitals or
entities that are parties to a cooperative agreement and have been issued a certificate of
public advantage pursuant to § 68-11-1303.
(b)
(1) A hospital system shall have as the governing body of the hospital
system a board of directors that complies with this section.
(2) A hospital system which has, on the effective date of this act, an
existing board of directors that does not comply with this section shall, within
thirty (30) days after the effective date of this act, vacate the existing board of
directors and reconstitute the board of directors in a manner that complies with
this section.
(c) The board of directors of a hospital system must consist of nine (9) voting
members who are nominated by the governor and, except as otherwise provided in
subsection (d), must be confirmed by joint resolution of the general assembly.
(d)
(1) If the general assembly is not in session when initial appointments
are made, all initial appointees serve the terms prescribed in subsection (h),

- 2 - 000021

unless the appointments are not confirmed during the next regular session of the
general assembly following the appointments.
(2) If the general assembly is not in session at the time a member is
appointed to fill a vacancy resulting from the expiration of a term, the member
whose term has expired serves until a new appointee is confirmed as provided in
subdivision (d)(1).
(3) If the general assembly is not in session at the time a member is
appointed to fill a vacancy not resulting from the expiration of a term, the new
appointee serves for the term appointed unless the appointment is not confirmed
during the next regular session of the general assembly following the
appointment.
(e)
(1) The following individuals are prohibited from serving as a member of
the board of directors of a hospital system for so long as they hold the office or
position:
(A) An employee of a hospital that is a party to the hospital
system's cooperative agreement;
(B) An employee of an entity that contracts to do business with
the hospital system or with any hospital that is a party to the hospital
system's cooperative agreement;
(C) A member of a governing body of any hospital that is a party
to the hospital system's cooperative agreement; and
(D) A person who has a financial interest in any contract or
transaction affecting the interest of the hospital system.

- 3 - 000021

(2) A violation of subdivision (e)(1) subjects the violator to removal by the
governor, board of directors, or the committee of state legislators appointed
pursuant to subsection (p).
(f) The reconstituted board of directors shall assume responsibility beginning
May 1, 2025. The reconstitution of the board of directors has no effect on any action
taken by the board of directors prior to May 1, 2025, unless such action is inconsistent
with this part.
(g) If a board of directors is not appointed by May 1, 2025, pursuant to
subsection (c) and subject to subsection (d), then the hospital system's certificate of
public advantage expires on May 1, 2025.
(h) In order to establish staggered terms of service for members on the board of
directors, the initial terms of the members of the board of directors appointed by the
governor pursuant to subsection (c) are as follows:
(1) Three (3) members shall each serve an initial one-year term,
beginning on May 1, 2025, and terminating on April 30, 2026;
(2) Three (3) members shall each serve an initial two-year term,
beginning on May 1, 2025, and terminating on April 30, 2027; and
(3) Three (3) members shall each serve an initial three-year term,
beginning on May 1, 2025, and terminating on April 30, 2028.
(i) Following the expiration of the initial terms prescribed in subsection (h), the
term for all members appointed to serve on the board of directors pursuant to subsection
(c) is three (3) years, beginning on May 1 of the year of appointment and ending on April
30 three (3) years later.
(j) Members appointed pursuant to subsection (c) are eligible to serve multiple
terms and succeed themselves; provided, that no person may serve more than two (2)

- 4 - 000021

consecutive terms, whether appointed as an initial member, as a successor member, or
to fill a vacancy. A member who serves two (2) consecutive terms may be reappointed
after two (2) years have elapsed since the individual's last date of service on the board.
(k) If a vacancy on a board of directors occurs by death or resignation, a
successor is appointed pursuant to subsection (c) for the remainder of the term, subject
to subsection (d). If a vacancy occurs by reason of expiration of a term, then the
member whose term has expired shall serve until a successor is appointed and
confirmed.
(l) Five (5) members of the board of directors constitute a quorum for the
purpose of transacting business.
(m) The failure of a member to attend at least fifty percent (50%) of the regular
meetings in a calendar year is cause for the member's removal and authorizes the
presiding officer of the board to call on the governor to appoint a successor.
(n) The governor is authorized to call the initial meeting of the reconstituted
board of directors to occur on or after May 1, 2025.
(o) The board shall hold at least one (1) stated meeting annually on a day or
days determined by the board from year to year and at called meetings that may be
necessary, to be called by the board or to be called by a legislative committee pursuant
to subsection (p), upon at least five (5) days' notice to the board members.
(p) The governor shall appoint a committee of members of the senate and house
of representatives that is authorized, by majority vote, to call a meeting of the board of
directors pursuant to subsection (o). The committee must only be composed of
members of the senate and house of representatives that represent a county or portion
of a county where the hospital system is located.

- 5 - 000021

(q) All meetings of the board must be made available for viewing by the public
over the internet by streaming video accessible from the board's website. Archived
videos of the board's meetings shall also be available to the public through the board's
website.
SECTION 2. If any provision of this act or the application of any provision of this act to
any person or circumstance is held invalid, the invalidity does not affect other provisions or
applications of the act that can be given effect without the invalid provision or application, and to
that end, the provisions of this act are declared to be severable.
SECTION 3. This act takes effect upon becoming a law, the public welfare requiring it.