HF533 Summary

• Requires nonprofit health care entities to obtain attorney general approval before converting or transferring material assets (10% of net assets or $10 million) to for-profit entities, with a 150-day waiting period and public hearing requirements.

• Prohibits officers, directors, key employees, and family members of nonprofit health care entities from receiving any compensation, financial benefits, ownership stakes, or business relationships in connection with conversion transactions.

• Mandates that conversion benefit entities (nonprofits receiving transferred assets) be 501(c)(3) corporations with community-based boards, conflict-of-interest policies, and prohibition on payments to the entity receiving the original assets.

• Requires nonprofit health maintenance organizations to devote all net earnings to nonprofit purposes and prohibits dividend or rebate payments, with violations subject to certificate of authority revocation.

• Extends the moratorium on conversion transactions from nonprofit health care entities to for-profit entities until July 1, 2029, with civil penalties up to $1 million for violations and attorney general authority to unwind illegal transactions.