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HB 905

Prohibit common ownership of certain health care entities

136th Legislature (2025-2026) Introduced by Sean Brennan and 4 co-sponsors

HB 905 bars shared ownership between health care providers and certain financiers (PBMs, distributors, and health plan issuers), with divestiture/cessation timelines and enforcemen

Referred to committee
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Bill Summary · HB 905

Summary of HB 905 (Ohio, 136th General Assembly)

Purpose and intent

  • Proposes to prohibit, across a broad range of health care entities, common ownership between certain health care providers/organizations and health plan issuers, pharmacy benefit managers, wholesale distributors of dangerous drugs, and wholesale distributors of medical devices.
  • Aims to reduce potential conflicts of interest and horizontal integration that could affect pricing, competition, and patient care within Ohio’s health care system.
  • Establishes a framework for orderly divestiture or cessation of in-state services if prohibitions are violated, and creates a dedicated fund to support enforcement outcomes.

Key provisions and changes

  • Definitions (Sec. 3962.01)

    • Clarifies terms:
    • Health plan issuer
    • Health care provider (includes hospitals, ambulatory surgical facilities, certain medical practice entities, certain pharmacies, home health agencies, and any other entity with a national provider identifier)
    • Management services organization (MSO)
    • Pharmacy benefit manager (PBM)
    • Wholesale distributor of dangerous drugs
    • Wholesale distributor of medical devices

  • Ownership prohibitions (Sec. 3962.02)

    • Prohibits simultaneous ownership by a single entity of:
    • A health plan issuer or PBM and a health care provider or MSO
    • A wholesale distributor of dangerous drugs or medical devices and a health care provider or MSO
    • Provisions apply regardless of direct or indirect ownership or partial ownership

  • Limited exception (Sec. 3962.03)

    • Ownership and operation that would violate 3962.02 is allowed if, while in violation, the owner and entities only provide services outside Ohio (i.e., to out-of-state customers). In-state activity still triggers prohibitions unless divestiture/cessation actions are taken under the framework.

  • Divestiture or cessation timelines (Sec. 3962.04)

    • If in violation on the effective date, the violator must choose:
    • (1) Divest all offending entities within 1 year
    • (2) Cease providing all in-state services within 2 years
    • If opting for cessation, the violator may use the interim period to wind down existing contracts and reorganize business affairs.

  • Guidance on compliance (Sec. 3962.05)

    • Secretary of State (through the Secretary of State’s Business Services Division) must issue compliance guidelines within 30 days of the section’s effective date.
    • Guidelines to include milestones for divestment and for cessation of in-state services.
    • Requires collaboration with and input from multiple state agencies (AG, Auditor, Department of Insurance, Medicaid, Health, Taxation, Board of Pharmacy) as appropriate.

  • Enforcement and remedies (Sec. 3962.06 – .08)

    • Failure to meet milestones can trigger civil actions.
    • Civil actions may include:
    • Temporary or permanent injunctions
    • Disgorgement of profits (calculated as 20% of monthly profits from in-state services, assessed monthly)
    • Directing disgorged funds to the Health Care Conglomerate Separation Fund (see Sec. 3962.12)
    • Court-ordered remedies may also include other equitable relief to redress violations and prevent recurrence.

  • Private right of action (Sec. 3962.09)

    • Individuals harmed by violations may sue for damages and injunctive or other equitable relief.
    • Private action is limited by the divestiture/cessation deadlines; a private action is barred unless the violator fails to meet the deadlines specified in 3962.04.

  • Preemptive court action (Sec. 3962.10)

    • Attorney General may seek an order to enjoin ongoing activities if imminent risk of violation is detected during the ownership-creation process.

  • Oversight and investigation (Sec. 3962.11)

    • State agencies (Department of Insurance, Medicaid, Health, Board of Pharmacy) may oversee and investigate alleged violations and may collaborate with the Attorney General, Auditor, Secretary of State, etc.

  • Health care conglomerate separation fund (Sec. 3962.12)

    • Establishes the fund, held by the State Treasurer but not part of the state treasury.
    • Fund consists of disgorged amounts from 3962.07/3962.08 actions.
    • Permits the Treasurer to use funds to:
    • Return disgorged amounts to violators if they meet deadlines
    • Distribute funds to state officers/agencies for enforcement purposes, allocated according to the jurisdiction of the activity that caused the disgorgement

Affected parties

  • Entities that would be governed by the prohibitions (broadly defined health care providers, MSOs, PBMs, health plan issuers, WDs of dangerous drugs, and WDs of medical devices) and their owners, whether direct or indirect, including corporate and organizational structures.
  • Ohio residents receiving in-state health care services, given potential changes in provider ownership structures and competitive dynamics.
  • State agencies involved in health care regulation and enforcement, including the Attorney General, Secretary of State, Department of Insurance, Department of Medicaid, Department of Health, Department of Taxation, and the State Board of Pharmacy.
  • The Health Care Conglomerate Separation Fund as the repository for disgorged funds and enforcement-related allocations.

Procedural and timeline aspects

  • Effective date is not specified in the text provided; the bill sets deadlines once enacted.
  • Guideline development by the Secretary of State and Business Services Division within 30 days of the section’s effective date.
  • Divestiture or cessation deadlines set:
    • Divest all relevant entities within 1 year
    • Cease in-state services within 2 years
  • Milestones and compliance timelines are to be established and monitored through the guidelines, with ongoing enforcement and potential civil actions if milestones are not met.
  • Possible private actions for individual harms are contingent on meeting or missing the specified deadlines.

Overall impact

  • Creates a comprehensive framework to separate ownership between health care providers and certain financial/care entities to limit cross-sectional influence on pricing, contracting, and service delivery.
  • Establishes enforceable timelines, penalties, and a dedicated fund to support enforcement and compliance activities.
  • Emphasizes regulatory collaboration across multiple state agencies to enforce competitive and patient-protection goals in Ohio’s health care market.

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

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