Sen. Katy Duhigg, D-Albuquerque, attends a hearing in 2022. Duhigg was one of the sponsors of the Health Care Consolidation Oversight Act in 2024 and its expansion in 2025. Courtesy/Santa Fe New Mexican
By CLARA BATES
The Santa Fe New Mexican
New Mexico has so far reviewed only two hospital acquisitions under oversight laws passed in 2024 and 2025, largely in response to the state’s nation-leading rate of private equity-owned hospitals.
One transaction was approved in December 2024 and the other is currently under review, according to the New Mexico Office of the Superintendent of Insurance and the Health Care Authority.
The Health Care Consolidation Oversight Act, approved in 2024, temporarily authorized the state’s insurance regulation agency to review certain transactions related to hospital mergers. That authority was expanded, made permanent and shifted from the insurance agency to the Health Care Authority in 2025.
Some lawmakers and advocates argue the law still has loopholes hindering transparency and oversight, and say there are more private equity transactions not being scrutinized because they’re not included under the law. The oversight efforts, though, have received strong pushback from the hospital industry in years past, and some lawmakers have argued private equity is unfairly demonized.
Sen. Katy Duhigg, D-Albuquerque, a co-sponsor of last year’s bill, said it was watered down in the legislative process to win passage. The state has the “good bones of an oversight system now, but I suspect what we’re going to see is that because we left those loopholes in, we’re not catching all the transactions that were intended to be caught,” she said.
The law is primarily focused on hospitals, although the co-sponsors initially wanted it to be more expansive.
Duhigg cited the purchase of several urgent care clinics last year by Lovelace Health System’s private equity-owned parent company as transactions that weren’t subject to review. Ardent Health, Lovelace’s parent company, acquired six urgent care clinics in New Mexico last year, according to a corporate disclosure from November.
She also said “significant weakening of whistleblower protections” during the legislative process last year make it less likely for workers affected by health care transactions to disclose key information to the state oversight body.
“We spent a lot of time working on that bill, really specifically trying to ensure that the language that we were using didn’t leave wiggle room, because all these companies — whether it’s private equity or not — that are doing this consolidation with health care, they hire very smart lawyers who are very good at figuring out how to get around oversight,” Duhigg said in an interview.
“And unfortunately,” she added, “a lot of that language got taken out.”
Duhigg said she plans to propose a bill in the Legislature’s 60-day session next year to close the loopholes and ensure the state has “meaningful oversight” over the transactions. This year’s legislative session is primarily focused on the budget.
Private equity debate
Hospital industry groups and business organizations called some of the requirements unnecessary and burdensome in 2024 and 2025, and fought for more information on proposed transactions to be confidential.
The New Mexico Hospital Association at first opposed the 2024 bill until it was pared down.
Troy Clark, the association’s president and CEO, said at the time his members were concerned about what it would cost to go through the review process and whether the decision is being made “on an objective, not subjective, basis, regardless of who’s in office.” He also said they were worried about having to go through a lengthy review if they’re considering a merger for financial relief.
Clark said he understands concerns about private equity ownership, but added in New Mexico “we have good evidence that it can be done successfully.”
J.D. Bullington, a lobbyist for the Greater Albuquerque Chamber of Commerce, said during a hearing on the bill last year, “Sometimes, the only solution for a local hospital staying out of red ink is acquisition by an entity that can bring financial resources to the table.”
The bill doesn’t only target private equity-backed acquisitions but was motivated in part by their prevalence in the state.
New Mexico had the highest rate of private equity-owned hospitals in the nation as of last year, according to a report from the Private Equity Stakeholder Project, at 36%.
National studies have linked private equity ownership to declining quality of care in hospitals.
That view is not universally shared in the Legislature: Lawmakers at interim committee hearings late last year said private equity-backed hospitals are saving rural communities and argued against enhanced oversight.
At a November meeting of the interim legislative Courts, Corrections and Justice Committee, Sen. Bill Sharer, R-Farmington, said several rural hospitals “would all be closed” if not for private equity intervention.
“There would be no health care system at all, had the private equity people not come in to save those hospitals,” Sharer said.
In an October Legislative Health and Human Services Committee hearing, Rep. John Block, R-Alamogordo, said further oversight could hurt rural communities.
Tightening acquisition oversight or banning the corporate practice of medicine “would kill access to capital for rural and community hospitals that desperately need investment,” he argued. “So private equity isn’t the enemy of health care. It’s often the last lifeline.”
The two reviews
The Office of the Superintendent of Insurance received two requests in the year it was tasked with oversight of hospital transactions, one of which was found exempt from the law, spokesperson Michelle Bowling wrote in an email late last year.
The first came from Ardent Health Services, a private equity-backed company that owns Lovelace Health System, Bowling said. Ardent proposed to convert from a limited liability company to a corporation and sell shares of common stock, Bowling wrote, but “a review of the transaction determined the conversion was not subject to the Act,” she added.
The second request was from Oceans Acquisition Inc., Bowling wrote, proposing to purchase Haven Behavioral Healthcare Inc., which includes a behavioral health hospital in Albuquerque.
That transaction was approved after the state review. Oceans appears to be backed by a Massachusetts-based private equity firm.
The oversight law requires, each year from 2025 to 2027, that Oceans submit various reports to the state including those showing the “growth, decline and other material changes in health care services provided by Haven Albuquerque,” the “cost trends” at Haven and any other material changes.
The Health Care Authority, which is now in charge of oversight, confirmed Oceans submitted the 2025 report.
Those reports are confidential.
The Health Care Authority has received one transaction for evaluation since taking over in July 2025, spokesperson Tim Fowler said.
The current transaction under review is by two trusts, Woodland SNF Operator Trust and Woodland SNF Operator Trust II, and associated companies, proposing to acquire 100% ownership of New Mexico Behavioral Healthcare in Albuquerque. According to the Health Care Authority, New Mexico Behavioral Healthcare has 18 inpatient beds at its Albuquerque facility now, and the transaction would expand the facility by 58 additional beds.
The Health Care Authority held a public meeting on the proposed transaction Nov. 4, Fowler said, and no comments were submitted. The agency will render a decision on the transaction by Feb. 6, according to the notice.
It doesn’t immediately appear the proposed buyers are linked to private equity firms — but the state doesn’t require public disclosure of ownership interests, and private equity firms often operate through other companies, said Michael Fenne, senior health care policy coordinator for the nonprofit Private Equity Stakeholder Project.
Fenne said he sees three broad issues in the New Mexico law compared with oversight laws in other states, noting some allow for more scrutiny.
One issue, Fenne said in an interview, is the “lack of transparency around backers and financial owners,” meaning the ownership structure, or whether there is a private equity connection, is not always clear.
He also noted the law is limited in scope: “New Mexico’s law focuses on hospitals and acquisitions by insurance companies, but private equity firms are also active in buying up individual providers, nursing homes, ambulatory surgery centers and other areas that aren’t covered by New Mexico’s law,” he said.
New Mexico is among the states with the highest rates of private equity-controlled nursing homes, at 35%, according to the Private Equity State Risk Index.
The third issue Fenne cited is that the post-transaction review period is just three years, so “private equity can wait those out.”
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