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The Florida Senate

2011 Florida Statutes

Title XI COUNTY ORGANIZATION AND INTERGOVERNMENTAL RELATIONS
Chapter 155 HOSPITALS Entire Chapter
SECTION 40
Sale or lease of county, district, or municipal hospital; effect of sale.
F.S. 155.40
155.40 Sale or lease of county, district, or municipal hospital; effect of sale.—
(1) In order that citizens and residents of the state may receive quality health care, any county, district, or municipal hospital organized and existing under the laws of this state, acting by and through its governing board, shall have the authority to sell or lease such hospital to a for-profit or not-for-profit Florida corporation, and enter into leases or other contracts with a for-profit or not-for-profit Florida corporation for the purpose of operating and managing such hospital and any or all of its facilities of whatsoever kind and nature. The term of any such lease, contract, or agreement and the conditions, covenants, and agreements to be contained therein shall be determined by the governing board of such county, district, or municipal hospital. The governing board of the hospital must find that the sale, lease, or contract is in the best interests of the public and must state the basis of such finding. If the governing board of a county, district, or municipal hospital decides to lease the hospital, it must give notice in accordance with paragraph (4)(a) or paragraph (4)(b).
(2) Any such lease, contract, or agreement made pursuant hereto shall:
(a) Provide that the articles of incorporation of such for-profit or not-for-profit corporation be subject to the approval of the board of directors or board of trustees of such hospital;
(b) Require that any not-for-profit corporation become qualified under s. 501(c)(3) of the United States Internal Revenue Code;
(c) Provide for the orderly transition of the operation and management of such facilities;
(d) Provide for the return of such facility to the county, municipality, or district upon the termination of such lease, contract, or agreement; and
(e) Provide for the continued treatment of indigent patients pursuant to the Florida Health Care Responsibility Act and pursuant to chapter 87-92, Laws of Florida.
(3) Any sale, lease, or contract entered into pursuant to this section prior to the effective date of this act must have complied with the requirements of subsection (2) in effect at the time of the sale, lease, or contract. It is the intent of the Legislature that this section does not impose any further requirements with respect to the formation of any for-profit or not-for-profit Florida corporation, the composition of the board of directors of any Florida corporation, or the manner in which control of the hospital is transferred to the Florida corporation.
(4) In the event the governing board of a county, district, or municipal hospital elects to sell or lease the hospital, the board shall:
(a) Negotiate the terms of the sale or lease with a for-profit or not-for-profit Florida corporation and publicly advertise the meeting at which the proposed sale or lease will be considered by the governing board of the hospital in accordance with s. 286.0105; or
(b) Publicly advertise the offer to accept proposals in accordance with s. 255.0525 and receive proposals from all interested and qualified purchasers.

Any sale must be for fair market value, and any sale or lease must comply with all applicable state and federal antitrust laws.

(5) In the event a hospital operated by a for-profit or not-for-profit Florida corporation receives annually more than $100,000 in revenues from the county, district, or municipality that owns the hospital, the Florida corporation must be accountable to the county, district, or municipality with respect to the manner in which the funds are expended by either:
(a) Having the revenues subject to annual appropriations by the county, district, or municipality; or
(b) Where there is a contract to provide revenues to the hospital, the term of which is longer than 12 months, the governing board of the county, district, or municipality must be able to modify the contract upon 12 months notice to the hospital.

A not-for-profit corporation that is subject to this subsection and that does not currently comply with the accountability requirements in this subsection shall have 12 months after the effective date of this act to modify any contracts with the county, district, or municipality in a manner that is consistent with this subsection.

(6) Unless otherwise expressly stated in the lease documents, the transaction involving the sale or lease of a hospital shall not be construed as:
(a) A transfer of a governmental function from the county, district, or municipality to the private purchaser or lessee;
(b) Constituting a financial interest of the public lessor in the private lessee; or
(c) Making a private lessee an integral part of the public lessor’s decisionmaking process.
(7) The lessee of a hospital, under this section or any special act of the Legislature, operating under a lease shall not be construed to be “acting on behalf of” the lessor as that term is used in statute, unless the lease document expressly provides to the contrary.
(8)(a) If, whenever the sale of a public hospital by a public agency to a private corporation or other private entity pursuant to this section or pursuant to a special act of the Legislature reflects that:
1. The private corporation or other private entity purchaser acquires 100 percent ownership in the hospital enterprise;
2. The private corporation or other private entity purchases the physical plant of the hospital facility and has complete responsibility for the operation and maintenance of the facility, regardless of ownership of the underlying real property;
3. The public agency seller retains no control over decisionmaking or policymaking for the hospital;
4. The private corporation or other private entity purchaser receives no funding from the public agency seller other than by contract for services rendered to patients for whom the public agency seller has the responsibility to pay for hospital or medical care;
5. The public agency seller makes no substantial investment in or loans to the private entity;
6. The private corporation or other private entity purchaser was not created by the public entity seller; and
7. The private corporation or other private entity purchaser operates primarily for its own financial interests and not primarily for the interests of the public agency,

such a sale shall be considered a complete sale of the public agency’s interest in the hospital.

(b) A complete sale of a hospital as described in this subsection shall not be construed as:
1. A transfer of a governmental function from the county, district, or municipality to the private corporation or other private entity purchaser;
2. Constituting a financial interest of the public agency in the private corporation or other private entity purchaser;
3. Making the private corporation or other private entity purchaser an “agency” as that term is used in statutes;
4. Making the private corporation or other private entity purchaser an integral part of the public agency’s decisionmaking process; or
5. Indicating that the private corporation or other private entity purchaser is “acting on behalf of a public agency” as that term is used in statute.
History.—s. 3, ch. 82-147; s. 1, ch. 83-158; s. 1, ch. 84-98; s. 6, ch. 87-92; s. 1, ch. 96-304; s. 6, ch. 99-356; s. 1, ch. 2006-170.