Take Back Our Hospitals Act of 2026
- Sponsor
- Rep. Scanlon, Mary Gay [D-PA-5]
- Committees
- Energy and Commerce Committee (primary)
- Last action
- Mar 12, 2026
Bottom line
The bill aims to exclude healthcare facilities owned by private equity or REITs from the Medicare program, based on concerns about corporate ownership's impact on patient care and costs.
What it actually does
This bill amends the Social Security Act to prohibit Medicare payments to hospitals and skilled nursing facilities (SNFs) that are owned or controlled by specific types of firms, including private equity funds, corporations controlled by private equity funds, and real estate investment trusts (REITs). It provides a three-year grace period for facilities already under such ownership at the time of enactment.
Proponents argue
Supporters argue that this bill is essential to protect Medicare beneficiaries by removing corporate entities perceived to prioritize profits over patient care, which they contend often leads to understaffing, reduced services, and compromised quality. They believe this measure will help ensure healthcare services are delivered with patient well-being as the primary focus.
Opponents contend
Opponents would likely argue that this bill restricts patient access to care by limiting the pool of participating providers, potentially destabilizing the healthcare market, especially in underserved areas where such firms might be the only source of capital for struggling facilities. They might also contend it unfairly targets specific ownership structures and discourages vital investment in healthcare infrastructure.
The bill is concise and directly addresses its core policy, making it accessible for a quick read and understanding of its primary implications.
Section 2, amending Section 1862 of the Social Security Act, new subsection (p)(1)(A)
Prohibition on Medicare Payments to Facilities Owned by Certain Firms
This provision establishes that Medicare will no longer make payments to hospitals or skilled nursing facilities if they are owned or controlled by a 'covered firm' or its affiliates. This means facilities under private equity fund, private equity-controlled corporation, or real estate investment trust (REIT) ownership would be ineligible for Medicare reimbursement.
Supporters argue
Supporters argue this provision is crucial for safeguarding patient care quality and ensuring that healthcare services are not compromised by profit-driven ownership models. They contend that private equity ownership often leads to cost-cutting measures that negatively impact patient outcomes.
Critics contend
Critics would likely argue that this provision is an overreach that could severely limit access to care, especially in rural or underserved areas where private equity investment might be the only viable option for facility survival or modernization. They might also argue it unfairly targets a specific business model.
Tradeoffs
The tension lies between the goal of protecting patient care from perceived profit motives and the potential for reducing the overall supply of healthcare providers, particularly in areas reliant on facilities with diverse ownership structures.
Section 2, amending Section 1862 of the Social Security Act, new subsection (p)(1)(B)
Grace Period for Currently Owned Facilities
This provision grants a three-year grace period from the date of enactment for hospitals and skilled nursing facilities already owned or controlled by a covered firm or its affiliate. During this period, these facilities can continue to receive Medicare payments before the prohibition takes full effect.
Section 2, amending Section 1862 of the Social Security Act, new subsection (p)(3)
Joint and Several Liability for Violations
This provision stipulates that if a hospital or skilled nursing facility violates the Medicare payment prohibition, the covered firm or its affiliate that owns or controls it will be held jointly and severally liable for any penalties or obligations incurred due to that violation. This ensures accountability extends to the ultimate owners.
Section 2, amending Section 1862 of the Social Security Act, new subsection (p)(4)
Definitions of Prohibited Ownership Structures
This section defines key terms. A 'covered firm' includes private equity funds, corporations owned or controlled by private equity funds, and real estate investment trusts (REITs). 'Control' is broadly defined as possessing the power to direct management or policies, directly or indirectly, including owning 10% or more of the voting securities of an entity.
Defines 'control' to include direct or indirect ownership of 10 percent or more of an entity's voting securities.
Section 2, amending Section 1862(p)(4)(B)(ii) of the Social Security Act.
Why it matters:This is standard legislative practice for defining terms, but the specific threshold is a critical detail for determining applicability.
Case for: Proponents would argue that a 10% threshold is a reasonable indicator of significant influence, even if not outright majority ownership, and is necessary to capture various forms of private equity control that might not involve a simple majority stake.
Case against: Opponents might argue that 10% is a relatively low threshold that could sweep in passive investors or minority stakeholders who do not exert operational control, potentially broadening the bill's scope beyond its stated intent.
Estimated impact: This definition significantly expands the number of entities considered 'controlled' by covered firms, thereby increasing the number of hospitals and SNFs potentially subject to the Medicare payment prohibition.
Defines a 'private equity fund' as a person who would be considered an investment company under section 3 of the Investment Company Act of 1940 but for the application of paragraph (1) or (7) of subsection (c) of such section.
Section 2, amending Section 1862(p)(4)(E)(i) of the Social Security Act.
Why it matters:This is common legislative drafting practice to leverage existing legal definitions, but it effectively 'buries' the precise scope of the term for those unfamiliar with securities law.
Case for: Proponents would argue that using established definitions from securities law provides legal clarity and consistency, ensuring that the bill targets the specific types of investment vehicles intended without creating new, potentially ambiguous, legal categories.
Case against: Critics might argue that relying on such technical, external definitions makes the bill less transparent and harder for the public and even many legal professionals to understand without specialized knowledge, potentially leading to confusion or unintended interpretations.
Estimated impact: This definition precisely delineates the universe of private equity funds targeted by the bill, ensuring that the prohibition applies to the specific investment structures that typically engage in control-oriented investments in healthcare.