Sponsors (3)
Bars REIT deals that would weaken health providers or threaten public health, mandates HHS review/enforcement, and treats qualified health care property income as REIT rent for tax purposes.
Official title: Prohibit certain sales or leases of real property for a health care entity if the terms of such a sale or lease would lead to long-term weakened financial status of the health care entity or place the public health at risk, and for other purposes.
Introduced October 8, 2025 by Edward John Markey · Last progress October 8, 2025
The bill strengthens federal review and state coordination to protect community access to health services and preserves favorable REIT tax treatment for health-property owners, at the cost of added compliance, penalties, potential federal–state friction, and some tax revenue and administrative complexity.
Hospitals and health systems are less likely to sell or lease assets in ways that weaken their long-term finances, reducing the risk of closures or service reductions that would disrupt local patient care.
Mandatory HHS review plus state coordination helps identify transactions that threaten public health or community access to services, preserving continuity of care for vulnerable beneficiaries.
Clarifying that income from qualified health care property counts as qualifying rent preserves REIT tax treatment and gives hospitals and health-system landlords clearer tax rules, which may encourage investment in health care real estate.
Hospitals, health systems, and covered firms will face added regulatory burdens and transaction delays from mandatory HHS reviews, increasing legal and compliance costs and slowing mergers or other transactions.
Federal review and intervention could preempt or complicate existing state regulatory regimes, creating duplicative oversight, legal uncertainty, and potential conflicts between federal and state authorities.
Civil monetary penalties of up to $10,000 per violation expose providers and covered firms to financial risk for inadvertent noncompliance, raising the cost of doing business for health care entities.
Based on analysis of 3 sections of legislative text.
Prohibits health care entities from entering sale or lease deals with REITs that would weaken a provider’s long‑term finances or risk public health, requires the HHS Secretary to review proposed terms and enforce the rule (including civil penalties and state enforcement backstop), and amends the federal tax code so income from certain qualified health care property counts as rent for REIT tax purposes. The bill defines covered health care entities and covered firms, authorizes consultations with state attorneys general, allows HHS lawyers to defend civil suits, and adjusts REIT rules to treat qualified health care property receipts as qualifying rent for taxable years after enactment.