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Members of the House Health Care Committee hear testimony at the Statehouse in February 2026. File photo by Glenn Russell\/VTDigger. File photo by Glenn Russell\/VTDigger<\/p>\nMembers of the House Health Care Committee hear testimony at the Statehouse in February 2026. File photo by Glenn Russell\/VTDigger. File photo by Glenn Russell\/VTDigger<\/p>\n
PE pare-down<\/p>\n
The clinical healthcare space is no place for private equity \u2014 at least, according to the Vermont Senate, which advanced H.583<\/a> on Wednesday morning. That bill would limit private equity involvement in healthcare to making only business, not medical, decisions.<\/p>\n However, the current legislation is a far cry from what it originally set out to do. The bill no longer prohibits private equity or hedge funds from doing business in the state\u2019s healthcare system.<\/p>\n \u201cIt still leaves Vermont very vulnerable. Very vulnerable,\u201d Rep. Alyssa Black, D-Essex Town, who sponsored the bill in the House, said of the encroachment of private equity on healthcare. \u201cWe have done nothing \u2014 nothing \u2014 to stop it.\u201d<\/p>\n The Vermont Health Care Advocate\u2019s Office originally proposed the bill as a safeguard after watching the fallout of Cerberus Capital Management, a private equity company, selling its investment in the Texas-based healthcare group Steward Health Care<\/a>, which had more than 30 hospitals across the country. The investor made $800 million in profits; the hospital group CEO took home more than $250 million; and then the group failed to pay vendors and employees, racking up a debt so extreme that vendors withheld medical devices, which cost lives<\/a>. Patient care suffered as a result of short staffing.<\/p>\n \u201cAll evidence suggests that the introduction of private equity into healthcare decreases quality, increases costs, and, frankly, leads to death and leads to bankruptcies,\u201d Black said.<\/p>\n The bill faced serious pushback from hospitals and groups of physicians, as it worked its way through the House Committee on Health Care earlier this spring. Many worried it would limit access to much-needed capital and prevent them from shifting a heavy administrative burden to those better suited to manage it.<\/p>\n \u201cThe original bill was very broad and captured transactions that we are looking to encourage potentially,\u201d said Devon Green, the vice president of the Vermont Association of Hospitals and Health Systems. She cited practices like sharing administrative services across hospitals or a healthcare facility using debt to affiliate with another. She worried about curbing these abilities especially as the state pushes broader hospital transformation work.<\/p>\n Lawmakers in the House eventually slimmed the bill down to a version with far fewer restrictions on private equity and hedge funds\u2019 ability to operate healthcare organizations in Vermont.<\/p>\n Black sees the version that passed through the Senate on Wednesday as a first step: It establishes a prohibition against something known as the \u201ccorporate practice of medicine.\u201d That means only licensed healthcare professionals can make medical decisions about treatment, scheduling and clinical staffing levels.<\/p>\n It\u2019s a protection that many states already have, and if the bill is enacted into law, Vermont will join them.<\/p>\n The legislation also establishes reporting requirements for healthcare organizations to publicly share data about their ownership and investors. Nursing homes, groups that operate only in telehealth and federally qualified health centers are excluded from those requirements.<\/p>\n Sam Peisch, a policy analyst for the Health Care Advocate\u2019s Office, was integral in the early phases of crafting and lobbying for the bill. He also sees the current language as a good first step toward further protections.<\/p>\n \u201cWe will get a much better view of the scope and scale of the involvement of private equity in Vermont\u2019s healthcare space,\u201d he said. \u201cWe will get that reporting back next spring, and we will see what happens there.\u201d<\/p>\n Peisch thinks that information can provide a launching-off point for further limitations on private equity\u2019s involvement in healthcare.\u00a0<\/p>\n Black agrees.\u00a0She wants to address debt financing, which she said essentially creates indentured servants out of healthcare organizations, gutting them and leaving them with no assets. The practice of lease-backs \u2014\u00a0selling property for a profit, and then leasing back the space \u2014\u00a0is another area she hopes to create protections against.\u00a0<\/p>\n Still, she worries about what is ahead.<\/p>\n \u201cIf you think they\u2019re not coming here, they are coming, and we have no protections,\u201d Black said. \u201cWe haven\u2019t experienced the negative effects of private equity \u2014 yet. We\u2019re lucky.\u201d\u00a0<\/p>\n In the know<\/p>\n House Speaker Jill Krowinski told reporters Wednesday that she is planning for the chamber to adjourn next Friday, May 22. She said she plans to start conducting twice-daily floor sessions as soon as this Friday, May 15, to accelerate the chamber\u2019s work.<\/p>\n That timeline is at least in part dependent on when, and in what form, the Senate approves its version of this year\u2019s major school funding and governance bill, H.955<\/a>. Asked about rumors that deliberations over that bill could push the session into next month, the speaker said: \u201cJune has never been on the table in the House.\u201d<\/p>\n \u2014 Shaun Robinson<\/p>\n Lawmakers originally wanted to ban federal agents in Vermont from wearing masks or disguises while doing their jobs, with some specific exceptions. Then, lawmakers in the House made a sharp change in course this month after a panel of three federal judges ruled that a similar California law was unconstitutional.\u00a0<\/p>\n Now, the bill, S.208<\/a>, tasks Vermont with creating a policy on masking and identification for local and state police. \u201cI believe it\u2019s something we can accept,\u201d said Gov. Phil Scott during his weekly press conference Wednesday, referring to the newest version of the bill.\u00a0<\/p>\n The changed bill was originally up for second reading on the House floor May 7, but representatives have postponed action twice, leaving it next up for consideration Thursday. House Speaker Jill Krowinski, D-Burlington, said votes on the bill have been postponed because lawmakers are continuing to debate it.\u00a0<\/p>\n \u201cThere\u2019s an appetite to include the feds despite the constitutionality concerns,\u201d Krowinski said.\u00a0<\/p>\n \u2014 Charlotte Oliver<\/p>\n On the move<\/p>\n The Senate sent H.577<\/a>, a prescription drug card bill, to the governor\u2019s desk Wednesday.\u00a0<\/p>\n