Sens. Warren, Markey propose bill that would lead to prison time for 'corporate greed' in health care
How does the proposed legislation plan to penalize health care executives who endanger patient safety and access to health care?
The proposed Corporate Crimes Against Health Care Act aims to penalize health care executives who endanger patient safety and access to health care through several mechanisms:
- Creating a new criminal penalty that could put executives in prison for up to six years if they loot health care entities, such as nursing homes and hospitals, and their actions lead to a patient's death.
- Authorizing state attorneys general and the U.S. Justice Department to claw back all compensation, including salaries, from private equity and portfolio company executives within a 10-year period before or after an acquired health care firm experiences serious, avoidable financial difficulties due to looting.
- Imposing an associated civil penalty of up to five times the clawback amount.
- Requiring health care providers receiving federal funding to publicly report mergers, acquisitions, changes in ownership and control, and financial data, including debt and debt-to-earnings ratios.
- Mandating a Health and Human Services Office of the Inspector General report to be sent to Congress detailing the "harms of corporatization" in health care.
The legislation aims to hold private equity firms and health care executives accountable for prioritizing profit over patient safety and access to health care.
What prompted Senators Elizabeth Warren and Ed Markey to introduce this legislation?
Senators Elizabeth Warren and Ed Markey were prompted to introduce the Corporate Crimes Against Health Care Act of 2024 due to the bankruptcy of Steward Health Care4. They believe that this situation is a clear example of private equity exploiting the healthcare system, which has led to detrimental effects on patient care and healthcare workers. The aim of the legislation is to root out corporate greed and private equity abuse in the healthcare sector, and to hold executives accountable for their actions2.
What specific provisions does the Corporate Crimes Against Health Care Act introduce to address corporate exploitation in health care?
The Corporate Crimes Against Health Care Act aims to address corporate exploitation in health care by introducing several provisions:
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New criminal penalties: The bill creates a new criminal penalty that could put executives in prison for up to six years if they engage in looting health care entities, such as nursing homes and hospitals, and their actions lead to a patient's death.
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Clawback provisions: The legislation authorizes state attorneys general and the U.S. Justice Department to claw back all compensation, including salaries, from private equity and portfolio company executives within a 10-year period before or after an acquired health care firm experiences serious, avoidable financial difficulties due to looting.
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Associated civil penalties: The bill introduces an associated civil penalty of up to five times the clawback amount.
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Public reporting requirements: Health care providers receiving federal funding would be required to publicly report mergers, acquisitions, changes in ownership and control, and financial data, including debt and debt-to-earnings ratios.
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Inspector General report: The act would require the Health and Human Services Office of the Inspector General to send a report to Congress detailing the "harms of corporatization" in health care.
These provisions aim to hold health care executives accountable for actions that put patient safety and access to health care at risk and to prevent future instances of corporate exploitation in the industry.