Rising Medical Costs Force Greater Scrutiny of Health M&A Deals

Healthcare attorney Nili Yolin spoke with Bloomberg Law about increased oversight from state regulators regarding major healthcare business deals, which comes as part of a larger effort to rein in soaring health spending. In this article, Ms. Yolin provides specific insight on the state of play in New York. The New York law requires a 30-day notice of material transactions, with a de minimus threshold of $25 million in gross in-state revenues. The law covers mergers and acquisitions, new agreements, and contracts. However, it leaves out collaborations to run a clinical trial or graduate medical education programs.

“The parties to this type of transaction are now going to have to give some thought to the transaction itself – to certain aspects of the transaction that they never really previously considered,” she said.

She also explained that the law needs clarification through regulations, such as outlining the time period for determining if a transaction meets the de minimus threshold.

“The definition of material transaction refers to a rolling 12-month period. The assumption is for purposes of determining whether it’s de minimis would probably be the same. But it’s certainly ambiguous,” she continued.

READ: Rising Medical Costs Force Greater Scrutiny of Health M&A Deals