DOH Posts Information Regarding New Material Transactions Reporting Law that Took Effect August 1
The New York State Department of Health has posted preliminary information on its website detailing the new law effective August 1 requiring certain health care entities in New York State, including private physician practices, to provide notice to the NYSDOH of material transactions at least 30 days prior to the closing of the transaction.
As a result of MSSNY advocacy, this law is far more scaled down than the original excessively burdensome proposal which would have required DOH approval for all such transactions, not just those exceeding $25 million in new in-state revenue. It would have greatly limited options for many physicians seeking to remain in independent practice.
The overarching goal of the new law is to provide DOH with more detailed information regarding the growing trend of purchases of medical practices by private equity companies.
As noted on the DOH page, a material transaction includes any of the following transactions within a rolling 12-month period that will result in a health care entity increasing its total gross in-state revenues by $25 million or more:
- A merger of one or more health care entities.
- An acquisition of one or more health care entities, including the assignment, sale, or other conveyance of assets, voting securities, membership or partnership interests or the transfer of control, such as contracting for services commonly provided through a management or administrative services agreement between a practice and an MSO.
- An affiliation agreement or contract formed between a health-care entity and another person.
- The formation of a partnership, joint venture, accountable care organization, parent organization, or MSO for the purpose of administering contracts with health plans, third-party administrators, pharmacy benefit managers, or health-care providers.
The site notes that the Material Transactions Form to notify DOH is under development and will be posted shortly. This completed form as well as any additional attachments must be submitted to: [email protected] at least 30-days prior to closing the transaction. The DOH will then post these transactions on their website for public comment.
If you need assistance with the new law, please contact MSSNY’s Senior Vice-President & Chief Legislative Counsel Moe Auster at [email protected].
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