A hospital would need a new license when it “Sells, transfers, leases, exchanges, options, conveys, or otherwise disposes of, material amount of its assets or operations to another individual or entity.” The bill defines “a material amount of its assets” as more than 10 percent of the value of the facility or a facility worth more than a value of $3 million.
A new license would also be necessary if a hospital “transfers control, responsibility, or governance of a material amount of its assets or operations to another individual or entity,” which includes the transfer of 10 percent or more of membership interests or voting rights of a limited liability company, 10 percent or more of stock or voting rights of a corporation, responsibility for the license to a new corporate member(s), or voting control of the governing body to a new member(s) of the governing body.
Among other requirements, the license application will confirm the applicant’s ability to finance the health facility for at least 45 days.
The current law demands that hospitals apply for a license only when first acquiring a health facility.
Read the bill on hospital licenses.
Read more coverage on California hospitals:
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– California’s Grossmont Healthcare CEO Sees $20K Raise For Increase in Duties
– California Employers Voice Concerns Over ACOs
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