New York Enacts New Notice Requirement for Health-Care Transactions

A new law requiring health care entities to provide notice of certain health care transactions goes into effect next week.  As of August 1, 2023, Article 45-A of the Public Health Law shall be binding in New York State.

Entitled “Disclosure of Material Transactions,” it requires that certain health care entities provide the New York State Department of Health (NYSDOH) with thirty-days’ notice prior to proceeding with certain material transactions.  Failure to abide by the new notice requirement can lead to civil penalties.

Article 45-A is broadly applicable to a wide-range of health care entities including physician practices and management services organizations (MSOs).  The notice requirement is triggered when any of the following occurs, whether it is in a single act or series of transactions over the course of a rolling twelve-month period:

  • A merger with a health care entity.
  • An acquisition of one or more health care entities, including the assignment, sale, or other conveyance of assets, voting securities, membership, or partnership interest or the transfer of control.
  • 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 or the purpose of administering contracts with health plans, third-party administrators, pharmacy benefit managers, or health care providers.

It is expected that the NYSDOH will issue implementing rules and regulations regarding process for compliance with the new notice requirement.  Meanwhile, if you have any questions on how Article 45-A might affect your business or whether an anticipated transaction constitutes a “material transaction,” requiring appropriate notice, contact us.

(This blog, prepared by Campanella Law Office, is for general informational purposes only and is not intended to convey specific legal advice, nor is it intended to create or constitute an attorney-client relationship.)

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