Nonprofit to for-profit hospital conversions, including direct sales and joint ventures, are sweeping the country. Over 170 nonprofit hospitals have entered into transactions with for-profit corporations since 1993. Texas is a hotbed conversion activity; 15 nonprofit hospitals have converted to for-profit status since 1990, seven in 1996 alone. The proliferation of these transactions is transforming the health care environment across the country, and in Texas, and involves the transfer of hundreds of millions of charitable dollars held in trust for the public. Yet, Texas charitable trust common law does not adequately preserve and protect these charitable assets and the state has failed to enact legislation to strengthen its oversight of nonprofit to for-profit hospital conversions. This report examines the policy issues raised by these controversial transactions and provides recommendations to address those concerns.
-- Author's foreword.