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HS

Bill

A 5185

Revises regulation of certain health care facilities.

2026-2027 Regular Session Introduced by Heather Simmons and 2 co-sponsors

The bill strengthens state regulation of health care facilities by expanding penalties, adding debarment and receivership tools, and requiring improvement plans to ensure patient s

Reported and Referred to Assembly Appropriations Committee
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Bill Summary · A 5185

Overview

A 5185, introduced in the 222nd New Jersey Legislature, revises the regulation of health care facilities, with a focus on strengthening enforcement, expanding debarment authority, increasing penalties, and clarifying oversight for hospitals, certificates of need (CON), and related procedures. The bill includes new provisions on real estate arrangements, hospital receivership, financial audits, and subsidy repayment in the event of early closure.

Main purpose and intent

  • Enhance the Department of Health’s ability to regulate health care facilities, particularly when facilities fail to meet standards or face financial distress.
  • Create mechanisms to prevent, remedy, or mitigate threats to patient safety, access to care, and fiscal stability in hospital systems.
  • Align penalties and enforcement with contemporary regulatory needs, while providing due process for facilities facing action.

Key provisions and changes

  • Pricey penalties for noncompliance:

    • Increases penalties for operating health care facilities without required approvals or after suspension/revocation of licenses to first offense: $12,500 per day; subsequent offenses: $25,000 per day.
    • Penalties may be adjusted annually via regulation, but increases cannot exceed the five-year CPI growth.

  • Debarment and certificate of need (CON) reform:

    • The Commissioner of Health would gain authority to debar facilities or ownership entities from eligibility for a CON based on substantial violations of the Health Care Facilities Planning Act or CON requirements.
    • Debarment involves notice, a right to appeal (to the Office of Administrative Law), and potential provisional actions for associated facilities if a hospital is debarred.

  • Hospital receivership and improvement plans:

    • If a hospital suffers acute distress or substantial violations, the department may intervene by:
    • Providing or directing management support and resources.
    • Initiating court proceedings to appoint a receiver to stabilize operations.
    • Requiring a comprehensive improvement plan, including cost containment and addressing disparities in care.
    • A provisional license for hospitals within the same system may be issued, converting to full license after approved improvements (typically within one year).

  • Real estate and CON site restrictions:

    • A new CON prohibition: facilities seeking to build or expand cannot obtain CONs for sites leased from a health care Real Estate Investment Trust (REIT).
    • Exemption for facilities already leasing from a REIT as of the effective date; the commissioner may waive the prohibition for satellite outpatient facilities.

  • Health care facility reporting and enrollment/claims:

    • Hospitals must file third-party claims within specified timeframes (60 days for patient-initiated claims; 180 days for claims assigned to the facility), subject to standard forms and conditions. Delays can result in payer denial rights and restrictions on direct patient collection.
    • Failure to comply may incur civil penalties; penalties and procedures align with existing penalty enforcement laws.

  • Financial reporting and charity care:

    • Hospitals must submit demographic and financial data used to calculate payer mix; penalties for noncompliance exist.
    • Hospitals with substantial violations may be required to submit third-party financial audits and comprehensive improvement plans.

  • Subsidy repayment:

    • If a subsidy-receiving hospital closes before June 30 of a calendar year, it must reimburse the state for the portion of the subsidy covering the post-closure period; failure to repay may trigger offsets against Medicaid payments within the hospital system.

Who and what is affected

  • Health care facilities licensed under New Jersey law (including acute care hospitals and residential facilities).
  • Hospital systems, particularly those with multiple campuses or associated entities.
  • Ownership structures and individuals with ownership interests in facilities (subject to debarment provisions).
  • Health care REITs and satellite outpatient facilities (due to CON site restrictions).

Procedural and timeline aspects

  • Debarment decisions are discretionary and factor-driven; appeals route to the Office of Administrative Law.
  • Provisional licensing and recovery plans have a defined timeline (often roughly one year) to implement comprehensive improvement plans.
  • Effective date: provisions take effect immediately; certain sections apply to CON applications filed on or after the effective date.
  • Regulatory action required for penalties and some procedures under the Administrative Procedure Act.

Note: The bill’s statement of intent emphasizes stronger enforcement, improved oversight, and structured remedies to ensure patient care quality and hospital system stability.

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

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