Following a series of hospital sale-leaseback transactions that preceded bankruptcy filings in 2024 and 2025, lawmakers at both the federal and state levels have taken notice. In response, legislators have introduced measures aimed at regulating, or increasing oversight of, certain health care real estate transactions.
These efforts seek to protect community hospitals from transactions that may weaken their finances, shift disproportionate value to private-sector investors or jeopardize access to essential services by saddling providers with long-term lease obligations.
As the regulatory landscape continues to evolve, hospitals and investors should assess these requirements early in the planning process. Below is a summary of federal and state legislative activity worth monitoring.
- Federal Legislation – In 2025, several senators proposed the Stop Medical Profiteering and Theft Act. The legislation is designed to prohibit health care systems from entering into sale-leaseback transactions with REITs that could weaken the health care provider’s financial stability. In 2026, several senators proposed the Take Back Our Hospitals Act. The legislation prohibits hospitals and nursing facilities owned by private equity from participating in Medicare. In both cases, the legislation hasn’t received the support needed to move forward at this time.
- New Jersey – In 2023, New Jersey enacted a rule that requires 90 days’ notice to the Department of Health before entering into agreements for the sale or sale-leaseback of hospital buildings.
- Minnesota – In 2024, Minnesota legislators proposed a bill that would have prohibited private equity companies and REITs from acquiring a direct or indirect interest in health care facilities. The bill failed to advance beyond the committee stage.
- Pennsylvania – In 2025, Pennsylvania legislators proposed a bill that would have allowed the Attorney General to review and potentially block sale-leaseback transactions and other health care transactions that are “against the public interest.” The bill is making its way through the legislative process.
- Maine – In 2025, Maine enacted a moratorium prohibiting a private equity company or REIT from acquiring or increasing a direct or indirect ownership interest, operational control or financial control in a hospital. In 2026, the legislation was expanded to include regulatory review and oversight of private equity and MSO transactions.
- Massachusetts – In 2025, Massachusetts enacted a law that significantly expands state oversight of transactions involving private equity investors, REITs and MSOs. In addition to subjecting sale-leasebacks to state review, the law prohibits acute care hospitals from leasing their main campus from REITs.
- Louisiana – In 2026, Louisiana legislators proposed a bill requiring hospitals to disclose certain real estate and sale-leaseback transactions to the Department of Health. The bill is making its way through the legislative process.
- California – In 2026, California legislators proposed an expansion to the state’s existing health care transactions oversight regulations that would increase disclosures and would specifically target private equity and MSO relationships.
- Connecticut – In 2026, Connecticut enacted legislation prohibiting hospitals from entering into sale-leaseback transactions. The legislation goes into effect on July 1, 2027.
- Washington – In 2026, Washington enacted legislation that requires hospitals to give the Attorney General notice of sale-leaseback transactions and other transactions involving the sale of a majority of the hospital’s assets.
For additional information on this topic, please contact:
- Andrew Dick at adick@hallrender.com or (317) 977-1491;
- Joel Swider at jswider@hallrender.com or (317) 429-3638; or
- Your primary Hall Render or Hall Render Advisory Services contact.
Hall Render blog posts and articles are intended for informational purposes only. For ethical reasons, Hall Render attorneys cannot—outside of an attorney-client relationship—answer specific questions that would be legal advice.
