After Madera collapse, lawmakers seek to block Bonta’s influence in hospital mergers

The California Attorney General played a central role in merger negotiations before the collapse, closure, and bankruptcy of Madera Community Hospital.

A new Republican-backed bill in the state legislature is seeking to keep California Attorney General Rob Bonta out of future hospital mergers. 

The bill, which was introduced last week by Sen. Shannon Grove (R–Bakersfield) and Brian Jones (R–San Diego), comes in response to the closure of Madera Community Hospital. 


The backstory: Last year, Madera Community Hospital found itself on the verge of bankruptcy after being throttled by the COVID-19 pandemic and with years of being underfunded by Medi-Cal reimbursement rates and facing the substantial costs of paying for travel nurses. 

  • Trinity Health, the Roman Catholic healthcare organization that operates Fresno’s St. Agnes Medical Center, had a deal in place to purchase Madera Community Hospital and keep the region’s lone hospital up and running. 
  • But Bonta tendered his own set of demands on the deal, including price rate caps on all hospital services for five years, leading Trinity Health to back out. Without a buyer, Madera Community Hospital closed up shop in January and filed for Chapter 11 bankruptcy protection.

What’s in it: Senate Bill 774, also known as the “Save Our Hospitals” bill, would prevent Bonta from putting specific conditions onto a merger, partnership or agreement between a nonprofit hospital and a for-profit business entity. Bonta and his successors would be prohibited from placing restrictions and conditions that would have the following impacts: 

  • Limit or restrict the normal operations of the hospital, such as entering into contracts or setting rates.
  • Have an adverse effect on the financial condition of the continued operation of the hospital. 
  • Impose political conditions targeted at the hospital which were not required in similar mergers in the past. 

What they’re saying: “This legislation is about prioritizing access to healthcare for my constituents in the Central Valley and ensuring the most vulnerable people have access to life-saving treatment,” Grove said. 

  • Jones took aim at Bonta and laid the blame at his feet for the closure of Madera Community Hospital. 
  • “Attorney General Bonta single-handedly took away access to an emergency room and specialty medical care from 150,000 Californians and put 700 hospital employees out of work,” Jones said. “Our measure will help prevent this from ever happening again.”
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