Modern Healthcare

A proposed California bill that would require the attorney general to sign off on any healthcare provider transaction exceeding $1 million would likely stifle mergers and acquisitions, regulatory experts said.

Authors: Paul W. Pitts

The legislation would give California Attorney General Xavier Becerra—who would have 60 days to review a deal involving providers, private-equity firms and/or hedge funds—an "unprecedented expansion of authority," experts said, noting that the $1 million threshold would encompass most healthcare transactions.

While providers argue that hospitals and physician groups will close if they have to clear the bill's "overreaching" standards, others claim that if implemented well, the bill could provide necessary oversight that could help maintain competition and keep prices in check.

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