Independent hospital districts required to analyze the benefits of going private under House bill

TALLAHASSEE, FLA. 9/22/21-Rep. Randy Fine, R-Palm Bay, during the House Redistricting Committee, Wednesday at the Capitol in Tallahassee. COLIN HACKLEY PHOTO

Independent hospital districts may have made sense years ago, but a leading House Republican contends they may be antiquated in Florida’s current health care marketplace.

Rep. Randy Fine, Chair of the powerful Health & Human Services Committee, filed legislation (HB 1421) that requires the 26 independent hospital districts in the state conduct a market evaluation by the end of the year analyzing the costs and benefits associated with converting their model into a private nonprofit entity.

“Just because something was a good idea in 1948, 1928 or 1968 doesn’t mean it’s a good idea today,” Fine told the members of the House Select Committee on Health Innovation before the panel voted 7-3 to advance the bill.

“What this bill would do is to require them to go out and hire someone independent and say hey, might somebody be willing to pay a lot of money for this? That money goes to the taxpayers and then it gets it off our books because, the fact of the matter is, if the private sector can do it the government probably shouldn’t be,” he said.

Rep. David Silvers questioned the costs of the market analysis required under the bill and who would be responsible for the tab. He also asked what the special district’s governing board should be considering when determining whether they want to sell the facility.

“Profitability, is that the main metric? Or if it makes economic sense to go private for the sale? Is that the main metric to determine whether or not the hospital should be sold?” he asked.

Fine said the bill didn’t address the metrics.

“The decision whether to put a hospital up for sale or if this bill were to pass, convert it to nonprofit status, that is a decision of the board,” Fine said.

To that end, the bill establishes a procedure for independent hospital districts to individually convert into a private nonprofit entity, allowing the governing body of the district to vote, requiring a majority.

If the governing body of the district determines conversion is in the best interests of the district’s residents, the board is authorized to negotiate an agreement with the governing body of each county in which any part of the district’s boundary is located.

This agreement must include the terms and conditions necessary for both disposing of the assets and liabilities of the system and ensuring health care services are provided to the district’s residents. The plan would have to be approved by all the parties.

If the hospital district levies, collects or receives ad valorem taxes, such as the North Broward Hospital District and the South Broward Hospital District, the conversion must be approved by the electors of the district voting in a referendum held during the next General Election.

The Safety Net Hospital Alliance of Florida opposes the bill but didn’t publicly testify against it.

HB 1421 heads to the House State Affairs Committee next. SB 1700, the companion measure, has been referred to three committees but has not been heard.