By Julia Burleson and Stacey Pogue
Elevated hospital consolidation and personal fairness in well being care have raised widespread issues about larger prices, diminished entry, decrease high quality, and decreased competitors. In New Mexico, a proposed merger between an area hospital system and a bigger out-of-state system aimed to create a 48-hospital system with roughly $11 billion in annual income. Though the transaction fell by way of, it highlighted the state’s lack of oversight mechanisms for mergers and acquisitions and spurred legislative motion.
In 2024, New Mexico enacted the Well being Care Consolidation Oversight Act (SB 15) and strengthened the legislation in 2025 with HB 586, which prolonged and expanded its authority. Whereas the 2025 laws constructed on the inspiration laid in 2024, it finally fell brief of its preliminary ambitions after encountering sturdy opposition from the hospital business and allied enterprise and supplier teams. Nevertheless, the state’s latest efforts lay the groundwork for a strong and clear oversight framework, which can develop into more and more vital as monetary pressures from the federal One Massive Stunning Invoice Act (H.R. 1) drive a potential new wave of mergers and acquisitions.
The Danger of Hospital Consolidation and Personal Fairness in New Mexico
New Mexico’s hospital sector is extremely consolidated, with KFF ranking all 4 of its metro areas as extremely concentrated. As well as, personal fairness companies personal 36% of New Mexico’s hospitals—the best proportion of any state. On the time state legislators launched SB 15 in 2024, New Mexico had no formal oversight course of for hospital transactions, not like most states.
In response, Consultant Reena Szczepanski and Senator Katy Duhigg sponsored profitable laws in each 2024 and 2025 to authorize state overview and approval of mergers and acquisitions involving hospitals. The legislators emphasised that the payments don’t block funding, however intention to make sure the state evaluates main well being care transactions for his or her potential impression on entry, value, and high quality.
They argued that personal fairness companies, which have a fiduciary obligation to prioritize shareholder earnings, could make choices that don’t align with group well being wants. The sponsors cited analysis linking personal fairness possession to decreased high quality of care, together with testimony from suppliers, sufferers, and advocates throughout the state concerning the impacts of hospital consolidation. By way of listening classes with stakeholders, Senator Duhigg and Superintendent of Insurance coverage Alice Kane heard studies of diminished entry to important companies reminiscent of labor and supply companies, following consolidations. The invoice sponsors additionally pointed to hospital consolidation as an element contributing to rising well being care prices. In 2020, common spending on hospital care was $3,960 per individual, larger than in neighboring states.
Momentary Hospital Consolidation Oversight Authority Enacted in 2024
New Mexico enacted the Well being Care Consolidation Oversight Act (SB 15) in 2024, which briefly licensed the Workplace of Superintendent of Insurance coverage (OSI), in session with the state’s Well being Care Authority, to overview and approve or deny mergers, acquisitions, and different transactions that may end in a change accountable for a hospital. OSI’s overview considers the impression the proposed transaction could have on entry to companies, high quality of care, affected person affordability, and competitors out there. As well as, the legislation granted OSI authority to conduct post-transaction oversight for 3 years to watch compliance with any situations positioned on accepted transactions and different outcomes.
The sundown date within the legislation repealed authority a 12 months later (as of July 1, 2025), giving invoice sponsors time to collect stakeholder enter and craft a extra complete and everlasting method for the 2025 legislative session.
Ups and Downs within the 2025 Session Yield Everlasting and Expanded Authority
Following the passage of SB 15, OSI and invoice sponsors carried out listening classes across the state, and heard from client advocates, group members, insurers, well being care suppliers, and hospital leaders. Within the fall of 2024, invoice sponsors outlined the extra complete method they deliberate to soak up the 2025 session, together with a timeline for taking stakeholder enter on the draft legislative language previous to session.
Invoice sponsors filed SB 14 in 2025, which sought to extend the transparency of proposed transactions and develop oversight to further sorts of transactions and entities past hospitals, together with different well being care suppliers and personal fairness buyers. SB 14 confronted overwhelming business pushback and was voted down in committee. Proponents scrambled to search out one other path to prolonged expiring state oversight authority in New Mexico’s brief, 60-day session, finally amending and passing a substitute invoice, HB 586. To cross the invoice, sponsors scaled again a number of provisions, for instance, guaranteeing info on proposed transactions confidential in response to issues from the state’s hospital affiliation.
Whereas HB 586 is pared down in comparison with SB 14, it expands on 2024’s SB 15 in a number of methods, together with:
- Making the state’s oversight authority everlasting;
- Increasing oversight to further transactions, together with acquisitions of impartial well being care practices by a well being insurer or its affiliated firms and adjustments accountable for the actual property a hospital sits on;
- Making among the info within the discover of proposed transaction public, together with the targets of the transactions and areas, companies, and teams impacted, and permitting public touch upon transactions underneath overview;
- Permitting the state’s overview to think about the transaction’s impression on worker salaries and dealing situations;
- Shifting oversight authority from OSI to the Well being Care Authority; and
- Establishing monetary penalties and non-compliance and whistleblower protections for hospital workers or others who report improper acts.
Wanting forward
Whereas proponents in each 2024 and 2025 aimed to ascertain extra strong well being care consolidation oversight modeled on Oregon’s authority, opposition from hospitals and business teams compelled compromises. But, New Mexico’s iterative course of reveals how sustained legislative engagement, stakeholder outreach, and a willingness to adapt can result in significant coverage improvement, even within the face of highly effective opposition. By constructing a basis for transparency, public accountability, and state-level approval authority, New Mexico is now higher positioned to answer the affect of hospital consolidation and personal fairness in well being care.
New Mexico joins a rising quantity of states with hospital consolidation oversight authority that extends past discover and overview to leverage approval authority and post-transaction monitoring. These oversight instruments could develop into more and more vital to states if shifts in federal coverage speed up hospital consolidation, impacting native entry to and affordability of well being care.
