Medicare telehealth received a critical, if temporary, reprieve with the enactment of new legislation that extends key pandemic-era telehealth flexibilities that were set to expire on January 31, 2026, to December 31, 2027. In this Client Alert from our healthcare team, learn more about the impacts of the new law and why providers, health systems, and digital health companies should use this window to assess compliance, billing, infrastructure, and long-term strategy in anticipation of potential policy shifts after 2027.  

Healthcare providers in New Jersey operate in one of the most highly regulated environments in the state, where employment law changes can directly affect daily operations, compliance obligations, and risk exposure. New legislation expanding employee leave and job-protection rights requires healthcare employers to reassess existing policies and practices to ensure they align with evolving state requirements. With expanded coverage thresholds and earlier employee eligibility, these changes may impact a wide range of healthcare organizations, making early awareness and preparation essential.

Read more in our latest Client Alert about the significant changes to Family Leave and job-protection obligations that take effect July 17, 2026.

On January 21, 2026, the New Jersey Appellate Division rejected a physician’s appeal concerning an Order of the Board of Medical Examiners dated April 19, 2024 enforcing a prior Consent Order that had been entered on March 14, 2007. The 2007 Consent Order had required the respondent physician to be accompanied by a chaperone whenever he examined or treated a female patient in all practice settings. The case illustrates the unsoundness of relying on the maxim that “it is better to ask for forgiveness than to ask for permission in advance.” Whatever the origin of this adage and despite its common usage in “business banter,” it has been observed that it “is almost never a valid approach in a court of law.”

The Board of Medical Examiners proceeding commenced in 2002 following disclosure of pending charges of criminal sexual contact against the respondent physician with a patient in 2002. (The physician was the respondent in the Board proceeding and the appellant before the Appellate Division.)  The Board entered an Interim Consent Order permitting the physician’s continued practice but requiring that during the pendency of the criminal case he employ a licensed health care professional to act as chaperone when he rendered medical services to female patients. The physician was acquitted of the criminal charge; however, the BME matter remained open and under investigation with an administrative complaint being eventually filed. The licensure proceeding was resolved with entry of the 2007 Consent Order with a finding of professional misconduct. The Consent Order suspended the physician’s license for one year but stayed the suspension to be served as a probationary period and continued the requirement of a chaperone for female patients, who was to be “approved by the Board” and who would provide regular reports to the Board. It further provided that after four years, the respondent could apply to the Board for relief from the chaperone requirement in all settings when treating a female patient. The Consent Order was signed both by the physician and his then attorney. Any deviation from its terms without prior written consent from the Board would constitute a violation of the order.

Based on an investigative report from the Attorney General’s Enforcement Bureau, the physician appeared before a Preliminary Evaluation Committee (PEC) of the Board on November 22, 2022, in which his non-compliance was discussed. There was a follow-up investigative report in June 2023. In November 2023, the Attorney General moved to enforce the terms of the 2007 Consent Order. The physician was now represented by a different attorney. The motion to enforce litigant’s rights was based on the two investigative reports indicating that the respondent physician had failed to comply with the chaperone requirements of the Consent Order. Instead of using a Board-approved chaperone, he was utilizing unlicensed members of his staff, who had not been approved by the Board. In testimony before the PEC and later in a public hearing before the full Board on December 13, 2023, the respondent physician admitted that he had been using employees and had not received permission from the Board to do so. Now represented by different legal counsel than he had in 2007, he further testified that while he had used Board-approved chaperones from 2003 until 2010, “his prior attorney had advised him he no longer needed to follow the consent order.” He claimed that his attorney indicated that he would file a motion to relieve the physician of the conditions of the Consent Order but no such motion was filed. There was no documentation or evidential support for these assertions. He further contended that inspectors for the Board making periodic visits to the office after 2010 knew he was using office staff and told him that he was compliant with the order.

At the conclusion of the December 13, 2023, hearing, the Board directed that the respondent physician be in full compliance with the 2007 Consent Order by January 12, 2024, and that he could temporarily use office staff until Board-approved chaperones were in place. If he did not obtain Board approval for the chaperones, he had to cease and desist from treating female patients until he did obtain approval. The Board announced its decision at the conclusion of the December meeting, which was memorialized in the Order of April 19, 2024, that became the subject of the Appellate Division’s review.

In that Order, the Board made the following findings:

Although Respondent makes vague assertions that he did so after he was told by his former counsel that the requirement no longer applied, he has not produced a scintilla of documented evidence to support that claim. Moreover, there is nothing in the Board’s records that suggests that he ever made a request to be relieved of the chaperoning requirement, nor anything in the Board’s records that suggests that the Board ever approved any modification or discontinuation of that requirement. Most significantly, it is clear that [the respondent] knew, or should have known, after he appeared for an investigative hearing before a Committee of the Board on November 22, 2022, that the chaperoning requirements in the 2007 Consent Order continued to apply to his practice, yet he has continued to practice thereafter without a professionally licensed Board-approved chaperone, manifesting a complete disregard for the authority of this Board and an inherent lack of understanding of why a chaperoning requirements was imposed in the first instance to protect vulnerable patients.

On appeal, the physician advanced three arguments. First, he contended that the Board waived the chaperone requirement. Next, he asserted that the Board’s procedure deprived him of proper notice and opportunity to be heard before a judicial forum in violation of the New Jersey constitutional requirement regarding separation of powers. Lastly, he contended that the Board’s decision was unsupported by a clear danger to the public. The Appellate Division was “unpersuaded” and affirmed.

Invoking the deferential standard for review of administrative agencies, it concluded that the Board’s action was neither arbitrary nor capricious. The Legislature had vested broad discretion in the Board for the regulation of the practice of medicine. The Board not only had authority to revoke or suspend licenses but pursuant to the Uniform Enforcement Act it also could order licensees to “submit to any supervision, monitoring or limitation on practice determined by the [Board] to be necessary.” The court rejected the argument that the Board’s supposed “laxity” in enforcing the Consent Order constituted a waiver of its requirements. It concluded that the Board could assess the credibility of the undocumented and non-specific assertions that he was told he was in compliance. It emphasized the continuing non-compliance with the Consent Order after the physician had appeared before the PEC in November 2022 and was made aware of the Board’s concerns. He took no corrective or protective action belatedly seeking relief from the terms of the Consent Order.

He unsuccessfully challenged the use of Zoom video technology to conduct the hearing before the Board as providing only a limited opportunity to testify. His claim that enforcement of the order had to be done in a judicial forum rather than an administrative hearing was summarily rejected with reference to long-standing precedent approving of an administrative agency serving in both prosecutorial and adjudicatory capacities.

The contention that there was no showing of danger or harm to the public was also rebuffed. The court cited a 2006 New Jersey Supreme Court decision holding that “the Legislature did not require a finding of patient harm before authorizing license revocation.” Because the physician did not establish any arbitrary, capricious, or unreasonable action by the Board or that the Board’s decision lacked support by substantial credible evidence, the Appellate Division affirmed.

Neither the Board’s ruling nor the Appellate Division’s opinion provide any insight into why a motion to be relieved of the terms of the Consent Order was not filed after it had been successfully adhered to beyond the four-year period required by its terms. The need for the chaperoning requirements came into existence because of the physician’s inappropriate conduct with a female patient. At a minimum this inappropriate behavior reflected bad judgment and decisions on his part, which he presumptively could remediate. Continuing flawed judgment, however, can be seen in the unilateral decision to discontinue complying with the Board’s chaperoning requirements without applying to the Board for permission, compounded by the decision not to immediately seek to comply after becoming aware of the Board’s concern manifested in the November 22, 2022, hearing.

There is another aspect of interest. The Appellate Division heard oral argument on September 10, 2025. Before that date, additional proceedings took place before the Board. On June 24, 2024, the Attorney General filed an administrative complaint alleging that notwithstanding the requirements of the April 17, 2024, Order, the respondent physician continued to see female patients without a Board-approved chaperone. Finding that the flagrant disregard of the Order constituted a clear and imminent danger to the public, the Board entered an Order on July 5, 2024, as permitted by the Uniform Enforcement Act, temporarily suspending the physician’s license until conclusion of a plenary hearing. Then on April 30, 2025, the Board entered its Final Decision and Order suspending the respondent’s license for a period of five years.  There is no reference to these events in the Appellate Division opinion.

New Jersey’s regulatory landscape may be frozen—but healthcare compliance risks are anything but. Governor Mikie Sherrill’s Executive Order 7 imposes a 90-day pause on new rulemaking, while former Governor Murphy’s termination of pandemic-era regulatory flexibilities is still set to take effect on February 16, 2026. For certain healthcare providers, these overlapping executive actions create uncertainty—but not a compliance grace period. In this recent Client Alert, we break down what EO 7 really means for APNs, physician assistants, and healthcare facilities, why proposed scope-of-practice expansions may be delayed, and what providers should be doing now to avoid enforcement exposure

New Jersey will fully exit its pandemic-era regulatory framework for certain healthcare providers on February 16, 2026. As outlined in this recent client alert by Greenbaum attorney Sukrti Thonse, impacted providers – including Advanced Practice Nurses, Physician Assistants, hospitals, medical practices, and providers operating under emergency or reciprocity licenses – should take action now to ensure that all collaborative agreements, supervision structures, and prescribing authority are compliant by the February 16th deadline.

Two lessons emerge from the Appellate Division’s December 5, 2025 opinion in Weissman v. Li. The first is a reiteration of the importance of precision of the language used in questioning witnesses. The other is rejection of the reflexive reluctance to question one’s own witness in a pretrial deposition.

This is a medical malpractice case involving a claim that spinal surgery caused the plaintiff’s leg and foot pain. The plaintiff had a Minimally Invasive Lumbar Decompression (MILD) procedure to treat his spinal stenosis. The trial court excluded the plaintiff’s liability expert, a board-certified anesthesiologist and pain management specialist, from opining on medical causation and then granted summary judgment dismissing the complaint for failure to establish a prima facie case because the plaintiff had no expert testimony to support the essential element of causation.

The trial court reached this conclusion for two reasons. The expert stated in his deposition that he would “defer to a neurologist” regarding causation undermining the witness’ expertise to express an opinion. In addition, the trial judge deemed the expert’s report an inadmissible “net opinion” lacking sufficient factual basis. On appeal, in an opinion authored by Judge Jack M. Sabatino, the Appellate Division affirmed but without endorsing the trial judge’s analysis completely. The court invoked the commonly used deferential standard for review of trial court evidentiary rulings from Townsend v. Pierre that admissibility of expert testimony “is committed to the sound discretion of the trial court” but with de novo review of questions of law. The court framed the pivotal legal issue as whether the plaintiff’s expert satisfied the requirement found at N.J.R.E. 702 that the witness has sufficient expertise to offer the intended testimony.

The plaintiff’s theory of liability was that while performing a surgical procedure on the patient’s spine, the defendant caused an injury to the nerve in the spine. The Appellate Division noted that the expert had extensive training and experience in the fields of anesthesia and pain management, was board-certified in the field, and was manifestly familiar with the nervous system and its effect on pain. He was the sole expert on behalf of the plaintiff. Since the defendant was a board-certified pain management physician, the expert satisfied the requirement of the Patients First Act that a witness opining on medical liability issues must have comparable or equivalent credentials to those of the defendant. The defense had two experts: a board-certified anesthesiologist and pain management specialist and a neurologist. The proffered opinions of the defense experts were that there was no deviation from accepted standards of care in the performance of the procedure and that the procedure did not cause the plaintiff’s leg and foot problems.

Defense counsel conducted a pretrial deposition of the plaintiff’s expert in a fashion to limit the scope of his opinions. In response to questions, the witness acknowledged that nerve injury was a known risk of the MILD procedure. The examination then included the following crucial passage:

Q: Would I be correct, Doctor, that you would defer to a neurologist in terms of whether or not Mr. Weissman’s complaints on the bottom of his foot are related to the surgery or not?

A: Yes, I would defer to a neurologist.

Q: I understand those are your opinions and maybe you just didn’t understand my question, because it could short-circuit the deposition is what I’m trying to do. So if I’m understanding, your role in this case is to give us your opinions as a pain management specialist as to deviation from standard of care. Correct?

A: Yes.

 Q: And I’m correct that in terms of what these alleged deviations caused in terms of any possible neurological damage to the patient, you would defer to a neurologist because that’s not your area of specialty. Correct?

A: Yes.

The trial court concluded that this deposition testimony was a concession by the expert that he was unqualified to opine on the causation issues in this case. On appeal, Judge Sabatino identified the effect of the expert’s concession that he would defer to a neurologist in the evaluation of the cause of the nerve injury as “a matter of first impression” in New Jersey. Although finding no germane precedent in New Jersey case law, he cited decisions from other jurisdictions addressing the issue. He referred to cases from the Tenth Circuit Court of Appeals (applying Kansas law) and from Georgia where an expert was disqualified from testifying on the basis of such a deferral to the expertise of another specialty. But decisions from other jurisdictions, including New Hampshire and Texas, reached a contrary conclusion. In final analysis, the court declined to adopt a blanket rule that such a concession precluded an expert from testifying and described the evaluation as “highly contextual.”

No one asked [the deponent] to define the term “defer” or what he understood the word to      mean in this context. The questioner did not define the term either. The plaintiff’s counsel did       not object to the question.

Nor did the plaintiff’s counsel ask any clarifying questions of the expert after defense counsel   had finished her questioning of Dr. Gerges.

Emphasizing the lack of definition or clarification, Judge Sabatino looked to dictionary usage of the word “defer” and found that these connoted a yielding or submitting to the opinions of another person. He noted that one might infer that the witness was acknowledging to his questioner that he is not a neurologist, and that only a neurologist is qualified to render opinions about whether the MILD procedure medically caused the plaintiff’s foot and leg pain. However, it could also be that he was simply expressing professional respect for the views of neurologists and their specialty. A third interpretation was that as a board-certified anesthesiologist and pain management doctor, he was not as qualified as a neurologist to render opinions about the cause(s) of a patient’s pain but notwithstanding that deference, he nonetheless advanced his own contrary opinions on what caused the plaintiff’s condition. In the context of a summary judgment motion given these various inferences and the need to draw all inferences in favor of the party opposing the motion, the court declined to rest the analysis on the supposed concession.

Rather Judge Sabatino proceeded to review the net opinion aspect of the trial court’s ruling. He concluded that the trial judge had correctly applied the doctrine’s requirement that the expert’s testimony must provide the “whys and wherefores” to support the admissibility of the opinion. The plaintiff’s expert report did not explain anatomically the causal mechanism as to how the spinal procedure produced the problem with a nerve root resulting in weakness of the plaintiff’s leg and pain in the foot. “An expert’s explanation of a causal mechanism is important when it is not obvious to a layperson how an action or inaction can cause an injury.” Since nerve injury is a generally recognized risk of this procedure, the expert did not explain how the risk of such harm in the plaintiff’s case was increased by the defendant’s alleged surgical deviations.  The expert’s discussion of causation was brief and largely a temporal analysis, resting upon what he referred to as the “timing component” of the plaintiff’s symptoms and conditions. But Judge Sabatino explained that “the association or coincidence of the timing doesn’t suffice to prove causation” and referenced the Supreme Court’s decision in State v. Olenowski, one of a line of cases holding that correlation, consistency or association does not equal causation. In Olenowski, while temporarily assigned tothe Supreme Court, Judge Sabatino demonstrated the insufficiency of “mere coincidence”:

A simple example illustrates the point: the fact that, between 1908 and 2020, the same political party’s candidate won the presidential election in two-thirds of the years in which a National League team won the World Series does not mean that the World Series outcome caused the presidential election result. The correlation between those events is obviously coincidental. 

The assertion that because a condition follows some event chronologically, it was caused by that event is the false logic of post hoc, ergo propter hoc rejected in several New Jersey decisions dating back at least to 1961 with Schulman v. Male. Temporal analysis may play a role in cases that qualify for the application of the doctrine of res ipsa loquitur; however, that doctrine is narrowly applied under New Jersey law to medical malpractice claims. Moreover, the doctrine has been held inapplicable to an injury which is a known risk of the surgery or procedure.

Judge Sabatino’s analysis of the supposed concession by the plaintiff’s expert that he was unqualified to opine on causation because he would “defer” to a neurologist illustrated the possible interpretations and resulting ambiguities of the testimony. The use of clear, precise language is essential to avoid misunderstandings and ambiguities, and to effectively communicate recollections and observations. Having a medical witness explain and define technical terminology is basic in trial work. The Appellate Division in its opinion in Ruth v. Fenchel recognized that this could be done by opposing counsel or even the judge at trial. This concern typically revolves around scientific or medical information. But one must be alert for not only for “weasel words” to evade answering a question but also for vague and connotative words capable of multiple meanings. Otherwise, there is a risk of setting the stage at trial for an exchange reminiscent of the scene in Through the Looking-Glass in which Humpty Dumpty said to Alice: “When I use a word, it means just what I choose it to mean — neither more nor less.”

That the plaintiff’s case was made vulnerable by the plaintiff expert’s concession regarding “deferring to a neurologist” is apparent in retrospect; however, that could have been recognized at the deposition table. While long-standing traditional wisdom is to not question one’s own witness at a pretrial deposition, that precept should not be rigidly followed in all situations. As Judge Sabatino commented, there was no objection to the form of the question and neither “did the plaintiff’s counsel ask any clarifying questions of the expert after defense counsel had finished her questioning.” The issue that was problematic at the trial level for the plaintiff could have been avoided. And that same issue that became adverse for the defense on appeal could have been eliminated with more precise follow-up phrasing that committed the witness to a definition of this critical term.

On November 12, 2025, President Donald Trump signed, legislation, H.R. 5371, extending key Medicare telehealth flexibilities on a temporary basis through January 1, 2026. Our previous client alert outlined the immediate rollback of pandemic-era telehealth rules following the government shutdown and the resulting disruption. This new legislation temporarily reverses that rollback and restores the pandemic-era telehealth framework.

In addition, the Centers for Medicare and Medicaid (CMS) is expected to issue updated guidance addressing the submission of impacted claims, eligibility for retroactive reimbursement, and the processing of claims that have been held or suspended—consistent with the clarifying bulletins CMS released during the shutdown period. While these extensions preserve many pandemic-era policies, it’s important to note that they do not make those policies permanent.

Providers and their organizations should plan now for potential changes when these flexibilities sunset.

Overview of Key Medicare Telehealth Flexibilities Extended Through January 1, 2026

  1. Home as an originating site: Medicare beneficiaries may continue to receive telehealth services from their homes without geographic or originating-site restrictions.
  1. Audio-only telehealth: Coverage for certain audio-only telehealth services remains in place subject to applicable service and documentation requirements.
  1. Expanded practitioner eligibility: The broadened list of practitioners eligible to furnish and bill Medicare telehealth services (e.g., physical therapists, occupational therapists, speech-language pathologists, and others) continues as permitted by statute and CMS guidance.
  1. Federally qualified health centers (FQHCs) and rural health clinics (RHCs) as distant site providers: FQHCs and RHCs may continue to serve as distant site practitioners for covered telehealth services, using applicable payment methodologies.
  1. In-person visit requirements: Any delayed or modified in‑person visit requirements tied to specific telehealth services remain deferred as provided in the new legislation and subsequent CMS rulemaking.
  1. Hospital and facility considerations: Flexibilities related to hospital outpatient department telehealth arrangements and supervision maintained under the extension continue to the extent preserved by the new legislation and CMS policy.

Note: These flexibilities apply to Medicare fee-for-service and may be incorporated into Medicare Advantage plans subject to plan terms. Commercial payer and Medicaid policies may differ by payer and state.

Implications for New Jersey Providers and Their Organizations

  1. Update policies and consent: Ensure telehealth policies, procedures, and consent forms reflect current federal requirements and New Jersey-specific laws and regulations, including licensure, scope of practice, patient identification, privacy/security, and emergency protocols.
  1. Billing and coding: Align coding, modifiers, and place-of-service indicators with current CMS guidance for telehealth (including audio-only where permitted) and verify payer-specific requirements for Medicare Advantage and commercial plans. Confirm FQHC/RHC billing rules where applicable.
  1. Compliance and documentation: Maintain documentation supporting modality (audio-only vs. audio-video), medical necessity, patient location, practitioner eligibility, and technology used; confirm HIPAA-compliant platforms or applicable enforcement discretion parameters as currently in effect.
  1. Cross-border practice: Confirm New Jersey licensure or applicable compacts/exemptions when treating patients located in New Jersey or out of state; verify payer credentialing and enrollment for telehealth services.
  1. Privacy and security: Review HIPAA and New Jersey privacy/security obligations; ensure Business Associate Agreements, risk analyses, and safeguards reflect telehealth workflows.
  1. Prepare for sunset: Develop contingency plans for services most affected if flexibilities lapse after January 1, 2026, including:
    • Reinstatement of geographic/originating site limits.
    • Narrower practitioner eligibility.
    • Restrictions on audio-only services.
    • Changes to FQHC/RHC distant site status and reimbursement.
    • Potential reimposition of in-person visit prerequisites.
  1. Monitor developments: Track CMS rulemaking and sub-regulatory guidance implementing H.R. 5371, as well as New Jersey legislative or regulatory updates that may affect Medicaid and commercial telehealth coverage.

Our Healthcare team will continue to monitor these issues and will keep you advised accordingly. Please contact the authors of this Alert with questions or to discuss your specific circumstances.

On May 12, 2025, President Donald Trump issued an Executive Order (EO) entitled “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients” with the goal of ensuring Americans pay no more for prescription drugs than other developed nations.

The EO directed the Secretary of Health and Human Services to communicate most-favored-nation (MFN) price targets to manufacturers, and if significant progress is not made toward such pricing structures, to propose a rulemaking plan to address the issue. The EO further directed the HHS Secretary to facilitate direct-to-consumer purchasing programs for manufacturers selling their products at the MFN prices.

In furtherance of these goals, on July 31, 2025, President Trump sent letters to leading pharmaceutical manufacturers outlining steps they must take to bring down the prices of prescription drugs in the United States to match the lowest price offered in other developed nations.  

As a result, on September 30, 2025, President Trump announced the first agreement with a major pharmaceutical company, Pfizer, to bring American drug prices in line with the lowest price paid by other developed nations.  According to the White House, the agreement with Pfizer will:

  • Provide every state Medicaid program with access to MFN prices on Pfizer products;
  • Ensure “foreign nations can no longer use price controls to freeride on American innovation” by guaranteeing MFN prices on all new medicines brought to the market by Pfizer;
  • Require Pfizer to repatriate increased foreign revenue realized as a result of the administration’s trade policies; and
  • Require Pfizer to offer medications at deep discounts when selling directly to American patients.

Also on September 30, the administration announced it would be rolling out a new direct-to-consumer website called TrumpRx, where individuals can buy prescription medications at discounted prices rather than through insurance. Though few specific details were provided about TrumpRx, the administration announced at least four Pfizer medicines, Eucrisa, Duavee, Zavzpret and Xeljanz, would be available through the website, which is planned for launch in “early 2026.”

The Pfizer deal and the announcement of TrumpRx constitute significant steps towards reaching the administration’s goal of lowering prescription drug prices for American citizens. However, the lack of specifics in the rollout of TrumpRx leaves many questions unanswered. At the top of that list is whether the TrumpRx program, which addresses the cash price of prescription drugs, will have a tangible impact on the prices patients covered by insurance pay for such medications.

California has enacted two bills that will significantly impact private equity firms, management services organizations (MSOs), and physician practices operating in the state.

Assembly Bill 1415 (AB 1415) and Senate Bill 351 (SB 351) build on longstanding concerns about the corporate practice of medicine (CPOM) by expanding regulatory oversight of transactions and strengthening statutory prohibitions on non-physician influence over clinical decision-making. Both measures were signed into law by Governor Gavin Newsom and are set to take effect on January 1, 2026, representing the most comprehensive update to California’s CPOM framework in decades.

AB 1415 focuses on transaction oversight and reporting. The bill broadens the scope of entities subject to the Office of Health Care Affordability (OHCA) review by expressly including MSOs, parent entities, private equity funds, and hedge funds within its notice requirements. Under AB 1415, any “material change” transaction involving a California healthcare entity—including changes of control, mergers, or significant asset transfers—will trigger a mandatory 90-day advance notice to OHCA. While the agency does not have explicit authority to block deals, its expanded jurisdiction means that private equity sponsors and MSOs must now plan for additional disclosure, regulatory scrutiny, and potential delays in closing.

SB 351 directly addresses the CPOM doctrine and explicitly extends its reach to private equity firms and hedge funds investing in medical and dental practices. The bill prohibits investors from exercising control over key aspects of clinical operations, such as hiring or firing physicians, approving diagnostic tests, controlling patient records, or dictating payer contracting terms. It also voids restrictive covenants such as non-compete and non-disparagement clauses in agreements between investors and physician practices. SB 351 grants the California Attorney General the authority to enforce these provisions and seek injunctive relief and attorneys’ fees, raising the stakes for non-compliance.

The key requirements and practice impacts of each bill are summarized on this chart:

BillFocusKey RequirementsPractical Impact
AB 1415Expands OHCA’s authority over health care transactions• Broadens scope to include MSOs, private equity, hedge funds, and parent entities.
• Requires at least 90 days’ advance notice to OHCA for “material change” transactions, including mergers, acquisitions, governance shifts, or significant asset transfers.
• Authorizes OHCA to collect data and impose reporting obligations on MSOs.		• Private equity and MSOs must account for new regulatory timelines in deal planning.
• Transactions that previously escaped notice may now face disclosure and review.
• OHCA scrutiny may delay closings or raise reputational risk.
SB 351Codifies and strengthens CPOM restrictions• Extends CPOM prohibitions to private equity firms and hedge funds.
• Bars investor interference with core clinical decisions (diagnosis, referrals, patient records, payer contracting).
• Renders void restrictive covenants such as non-competes and non-disparagement clauses in physician practice agreements.
• Grants Attorney General enforcement authority, including injunctions and recovery of attorneys’ fees.		• Heightened risk of AG enforcement actions.
• Common MSO/PE contract provisions may need revision.
• Physicians gain greater statutory protection against investor control.
• Potential chilling effect on investment structures in California.

Together, AB 1415 and SB 351 underscore California’s effort to curb perceived overreach by private equity in healthcare and to preserve physician independence. For private equity firms, MSOs, and physician groups, the new laws require proactive contract review, careful structuring of governance rights, and early regulatory engagement in transactions. Given California’s outsized influence, these developments may also set the tone for similar legislative efforts across the country.

As of this writing, New Jersey has not introduced new CPOM legislation comparable to AB 1415 or SB 351. However, there has been significant talk in the healthcare industry and in regulatory circles about ways in which the government can strengthen its oversight and authority over private equity investment in healthcare.

AB 1415 and SB 351 encompass the types of strengthened controls one would expect, and thus, those involved in private equity transactions in New Jersey should not be surprised if similar bills are introduced here in the coming future. Nevertheless, for the time being, New Jersey continues to enforce a long-standing prohibition on the corporate practice of medicine through professional corporation laws and Board of Medical Examiners regulations. While management services arrangements are permitted, New Jersey requires that only licensed physicians control medical practices, and regulators closely scrutinize agreements that grant non-physicians influence over clinical judgment.

For private equity firms and MSOs active across multiple jurisdictions, this means that although California now imposes explicit statutory regulation, New Jersey’s risk remains grounded in its established regulatory framework, and deal structures must be calibrated to comply with both regimes. For more information regarding New Jersey’s CPOM regulations, please see our prior posts on this blog.