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HB 5197

AN ACT PROHIBITING LICENSURE OF ACUTE CARE HOSPITALS THAT LEASE PROPERTY OWNED BY REAL ESTATE INVESTMENT TRUSTS.

2025 Regular Session Introduced by Tom Delnicki and 2 co-sponsors

Connecticut would prohibit acute care hospital licenses for facilities leasing property from REITs, potentially forcing operational changes or closures.

REF. TO JOINT COMM. ON Public Health
#hospitals #realestateinvestmenttrusts
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Bill Summary · HB 5197

Legislative bill overview

HB 5197 would prohibit the state from issuing or renewing licenses for acute care hospitals that lease their property from Real Estate Investment Trusts (REITs). This creates a structural barrier preventing hospitals operating under REIT-leased facilities from obtaining or maintaining operational licensure in Connecticut.

Why is this important

Hospital licensing is a fundamental regulatory requirement—without it, facilities cannot legally operate. This bill would effectively force any acute care hospital currently leasing from a REIT to either acquire the property, find alternative ownership, or cease operations. This touches on healthcare access, facility stability, and the role of real estate financing in hospital operations.

Potential points of contention

  • Healthcare access impacts: Forced property transitions could destabilize hospital operations during transitions, potentially affecting patient care and employee continuity
  • Economic feasibility questions: Hospitals would face significant costs to purchase property or exit leases; unclear how this affects hospital viability, pricing, and affordability
  • REIT ownership prevalence: The bill's real-world scope is unclear—how many Connecticut acute care hospitals currently lease from REITs, and would compliance be possible for all affected facilities?
  • Regulatory approach: Whether licensing restrictions are the appropriate tool versus direct regulation of REIT healthcare leasing practices
  • Unintended consequences: Could reduce hospital real estate financing options, increase borrowing costs, or discourage healthcare investment in the state

Compiled from official sources — confirm details with the bill’s official record.

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