Health Law Advisor

On September 11, 2026, California’s Office of Health Care Affordability (OHCA) Department of Health Care Access and Information (HCAI) released advance notification of proposed emergency regulatory action (the “Proposed Emergency Regulations”) regarding material change health care transactions. The Proposed Emergency Regulations—subsequently submitted to the state’s Office of Administrative Law (OAL)—further implement California’s AB 1415[1] respecting state oversight of private equity (PE) groups, hedge funds, and management services organizations (MSOs) operating in the health care space. As EBG wrote at the time of signing in 2025, AB 1415, which took effect January 1, 2026, represented a significant change for PE groups, hedge funds, and MSOs in the state by expanding OHCA’s notice requirements.

[1] Cal. Stats. 2025, ch. 641

Hospital M&A activity has been increasing recently, and when these transactions are public knowledge, opposition from the physician community (as well as the hospital staff) to such types of transactions may also be a side effect.  Physicians are vital to the operation of a hospital, and any resistance from the physician community, could be a tremendous obstacle, either slowing down the transaction or causing the potential buyer to pull out of the deal.  Hospital administrators, along with their advisors, should do their best to foresee any opposition and manage physicians ...

While I may be stating the obvious, hospitals and health systems are complex creatures that frequently drive local economies, culture and population health status (among other things).  Accordingly, when considering a potential change of control transaction, it is critical that you examine what drives your organization and what [in the community] your organization drives.  In particular, the latter is frequently overlooked in these circumstances.

What Drives Your Organization (Your Mission)

So, how do you begin to identify your organization's priorities?  I recommend ...

Organizations considering a significant transaction have a lot to think about.  One of the most important is making certain that relationships with key constituents and stakeholders are appropriately maintained and managed.  Too frequently, community hospitals and community health systems underestimate the scope and importance of those relationships.

Most of us can rattle-off a short list of key constituents and stakeholders for community hospitals and community health systems.

Here's my standard list, together with a short description of why they are important:

• Board ...