Brief
The question of who actually decides where a U.S. hospital opens or closes has no single answer because authority is split across at least four layers that rarely coordinate and are individually opaque. At the state level, Certificate-of-Need (CON) programs remain the primary legal gatekeeper: as of 2026 approximately 35 states and Washington, D.C. still require a CON before a hospital or health system can build, expand, or add major equipment. But that regulatory floor is shifting under pressure — Tennessee passed SB1369 on April 16, 2026 to repeal CON requirements for acute-care hospitals effective 2030, Mississippi's HB 3 (signed February 4, 2026) raised the capital-expenditure threshold triggering CON review from $2 million to $5 million, and North Carolina and several other states have moved toward full or partial repeal, all amid federal pressure tied to CMS scoring states on CON reform in rural health grant applications.
A second layer sits above or beside CON: state-sanctioned monopoly agreements called Certificates of Public Advantage (COPAs), which let hospital mergers bypass federal antitrust review in exchange for state oversight. Ballad Health — formed in 2018 from the merger of Mountain States Health Alliance and Wellmont Health System under Tennessee and Virginia COPAs, and now operating 20 hospitals across northeast Tennessee and southwest Virginia — is the highest-profile test case, with the Tennessee legislature moving in April 2026 to let its COPA expire in 2028 over explicit objections from the FTC, which warned the move risks price and quality harm if competition doesn't immediately fill the vacuum. The Tennessee House passed the measure 79-14 in April 2026, illustrating that even lawmakers who voiced concern about a post-COPA competition gap voted for deregulation anyway.
The third and least transparent layer is ownership and capital structure. Private equity firms owned approximately 488 U.S. hospitals as of April 2025 — about 8.5% of all private hospitals and over 22% of for-profit hospitals — concentrated among a small number of firms: Apollo Global Management (Lifepoint Health, ScionHealth), Equity Group Investments (Ardent Health Services), Welsh Carson Anderson & Stowe (Emerus Hospital Partners), and others. These firms increasingly avoid outright acquisition in favor of joint ventures with nonprofit systems — Lifepoint alone operated at least 70 joint ventures with more than 30 nonprofit partners as of January 2026 — a structure that keeps the nonprofit brand and community goodwill on the door while private equity controls the capital stack, often invisibly to the CON regulators and legislators nominally overseeing siting decisions. REITs add a further capital layer: Medical Properties Trust, formed in 2003, held 373 properties across 51 operators, roughly 38,000 hospital beds, in 30 U.S. states and 9 countries as of June 30, 2026 — and a December 2025 BMJ study of REIT sale-leaseback transactions found the arrangements associated with subsequent hospital financial deterioration, closure, and bankruptcy, most visibly in the collapses of Steward Health Care and Prospect Medical Holdings.
The fourth layer is the emerging state legislative and attorney-general response to the first three: at least 25 states have proposed or passed laws since roughly 2024-2026 increasing oversight of healthcare ownership transactions, spurred by a wave of PE-backed hospital-chain collapses. Connecticut's 2026 law requires hospitals to annually attest that no private equity entity holds controlling interest or influences clinical policy; New York, Pennsylvania, Vermont, Massachusetts, Illinois, and others have introduced or passed material-transaction notice laws aimed at the same target. Pitchbook data cited in an August 2026 Stateline report shows PE-involved healthcare deal value declining in the first half of 2026 versus the same period in 2025, though the Private Equity Stakeholder Project cautions it is too early to attribute the decline definitively to the new laws, since many only took effect in 2026 or 2027. The net effect is a system where the actors who most directly determine facility access — the PE sponsor structuring a joint venture, the REIT setting a lease rate, the CON board weighing a competitor's objection — are frequently the least visible to the patients and communities the decisions affect.
The Players (9)
Apollo Global Management (via Lifepoint Health / ScionHealth)OrgPrincipal
Private equity sponsor controlling one of the largest for-profit hospital platforms in the U.S.
Stake: Maximizing return on its hospital platform through consolidation, joint-venture expansion into nonprofit-branded markets, and periodic asset shuffling between its own portfolio companies.
Leverage: Lifepoint operated at least 70 joint ventures with over 30 different nonprofit partners as of January 2026, and Apollo orchestrated a 2026 transaction moving eight ScionHealth community hospitals back to Lifepoint — both entities being Apollo-owned — giving Apollo direct control over facility footprint decisions across dozens of communities without a single conventional M&A filing.
Track Record: Apollo acquired Lifepoint in 2018 for $5.6 billion and now holds a 97% ownership stake; its 2021 merger of Lifepoint and Kindred Healthcare created ScionHealth specifically to house facilities and debt separately from Lifepoint's core balance sheet.
Current Move: Consolidating hospitals back onto the Lifepoint platform from ScionHealth in 2026 while continuing to expand joint ventures with nonprofit health systems as its primary growth vehicle.
Apollo has effectively built a shadow health-system operator whose facility decisions run through nonprofit joint-venture wrappers, making its actual footprint control far larger than its headline ownership stake suggests.
Watch: Whether more states adopt Connecticut-style attestation laws requiring hospitals to certify no PE controlling interest, which would force greater disclosure of Apollo's JV structures.
Medical Properties Trust (MPT)OrgPrincipal
Publicly traded REIT and one of the world's largest owners of hospital real estate
Stake: Generating rental income and shareholder returns from sale-leaseback financing of hospital buildings, independent of whether the operating hospital ultimately survives financially.
Leverage: MPT held 373 properties across 51 operators, roughly 38,000 hospital beds, in 30 U.S. states and 9 countries as of June 30, 2026 — meaning it holds the underlying real estate for a hospital footprint the size of a mid-sized health system, and can set lease terms that determine whether a facility remains financially viable.
Track Record: MPT's sale-leaseback deals with Steward Health Care preceded Steward's 2024 collapse, described as the largest hospital bankruptcy in U.S. history, and a similar sale-leaseback arrangement is tied to Prospect Medical Holdings' subsequent financial strain and bankruptcy.
Current Move: Executing a 'balance sheet de-leveraging offensive' following the Steward collapse, having transitioned 15 major hospitals to replacement operators while continuing to pursue new sale-leaseback deals internationally.
MPT sits structurally outside CON review and state hospital-ownership disclosure laws entirely because it owns buildings, not licenses — a regulatory blind spot that a December 2025 BMJ study links directly to closure and bankruptcy outcomes.
Watch: Whether more states follow the emerging pattern of restricting REIT operational control over hospitals, as Connecticut's HB 5316 does starting October 1, 2026.
Tennessee General AssemblyOrgPrincipal
State legislature actively rewriting the two central legal instruments controlling hospital siting and monopoly power in its state
Stake: Balancing deregulation pressure (tied to federal CMS scoring of state CON reform for rural health grant funds) against maintaining oversight of a state-sanctioned hospital monopoly.
Leverage: Passed SB1369 on April 16, 2026 to repeal CON requirements for acute-care hospitals effective 2030, and separately passed a House measure (79-14 vote in April 2026) to let Ballad Health's Certificate of Public Advantage expire in 2028 — two votes that together determine whether an entire 20-hospital regional monopoly faces competition or continues operating under state protection.
Track Record: Tennessee and Virginia lawmakers waived antitrust regulations in 2018 to allow the Mountain States Health Alliance–Wellmont Health System merger that created Ballad Health, overriding explicit FTC opposition at the time.
Current Move: Proceeding with COPA sunset and CON repeal legislation in 2026 despite a formal FTC warning that ending oversight without ensuring immediate competition risks price and quality harm.
Tennessee lawmakers are running a live, high-stakes experiment in removing both the entry barrier (CON) and the monopoly safeguard (COPA) for the same regional hospital system at nearly the same time, with even sympathetic legislators voting for it while voicing doubt.
Watch: Whether the state fills the two-year gap the FTC flagged between COPA expiration (2028) and CON repeal (2030) with a new competition-oversight mechanism.
Federal Trade CommissionOrgMajor
Federal antitrust regulator with authority over hospital mergers absent state-granted COPA immunity
Stake: Preventing hospital-market monopolization and price increases that follow when competition is removed without a functioning alternative safeguard.
Leverage: Issued a formal public warning to Tennessee lawmakers in April 2026 that ending Ballad Health's COPA without ensuring immediate market competition risks price and quality harm, and has previously issued orders to five health insurance companies and two health systems to study COPA effects on price, quality, and wages.
Track Record: The FTC formally opposed the 2018 Mountain States–Wellmont merger that created Ballad Health but was overridden when Tennessee granted the COPA in September 2017.
Current Move: Publicly pressuring the Tennessee legislature in 2026 to pair COPA termination with stronger competition safeguards rather than allowing an unregulated gap between COPA expiration and CON repeal.
The FTC has no direct veto over state COPA or CON decisions, so its influence here is entirely reputational and advisory — Tennessee's 79-14 House vote in favor of COPA repeal despite the warning shows the limits of that leverage.
Watch: Whether the FTC escalates from public comment to formal antitrust action once Ballad's COPA actually expires in 2028.
State Certificate-of-Need boards and health departmentsOrgPrincipal
The direct regulatory gatekeepers who approve or deny hospital construction, expansion, and major-equipment purchases in states that retain CON law
Stake: Balancing stated goals of cost control and preventing facility oversupply against political pressure to deregulate and against use of the CON process by incumbent hospitals to block new competitors.
Leverage: As of 2026, approximately 35 states and the District of Columbia still operate CON programs covering hospitals, meaning these boards hold a legal veto over new hospital construction across the majority of the country's population footprint.
Track Record: A Tennessee administrative law judge blocked Vanderbilt University's approved, CON-granted new hospital in Rutherford County after existing providers intervened, delaying a 42-bed facility that had been in the works since 2020.
Current Move: Operating under active legislative rewrite pressure in 2026, including Mississippi's HB 3 raising the capital-expenditure CON threshold from $2 million to $5 million (signed February 4, 2026) and Tennessee's scheduled 2030 sunset for acute-care CON.
CON boards are simultaneously the most direct and most contested gatekeeper in the system — existing hospitals routinely use the same process meant to prevent oversupply to block would-be competitors, as the Vanderbilt case shows.
Watch: How many of the roughly 35 remaining CON states follow Tennessee, Mississippi, and North Carolina toward full or partial repeal in the 2026-2027 legislative cycles.
Ballad HealthOrgMajor
State-sanctioned regional hospital monopoly operating under a Certificate of Public Advantage
Stake: Preserving its protected market position and negotiated price-growth commitments while facing a legislated end date for that protection.
Leverage: Operates 20 hospitals across northeastern Tennessee and southwestern Virginia under a COPA that has, since 2018, displaced ordinary federal antitrust scrutiny of what would otherwise be an unambiguous hospital-market merger to monopoly.
Track Record: Formed in 2018 through the merger of Mountain States Health Alliance and Wellmont Health System, a deal the FTC formally opposed for more than two years before Tennessee granted the COPA in September 2017.
Current Move: Publicly defending its COPA and cooperative-agreement structure as the state legislature moves to let it expire in 2028, citing negotiated commitments to limit regional healthcare price growth below the national average.
Ballad is the clearest live example of a hospital system whose entire market structure — and by extension its power over regional facility decisions — depends on a single, now-expiring state legal instrument rather than ordinary competitive dynamics.
Watch: Whether Ballad pursues a renewed or restructured COPA before the 2028 expiration or pivots toward voluntary commitments to preempt federal antitrust action.
Connecticut General AssemblyOrgMajor
State legislature that enacted the most aggressive current state law restricting private-equity control over hospital operations and real estate
Stake: Responding to constituent anger over the collapse of the bankrupt Prospect Medical Holdings, which owned three troubled Connecticut safety-net hospitals.
Leverage: Its 2026 law requires hospitals to annually attest that no private equity firm holds controlling interest or influences clinical policy affecting triage, admission, or discharge decisions, and HB 5316 prohibits REITs from acquiring or increasing operational control over a hospital or health system starting October 1, 2026.
Track Record: Passed in direct response to the collapse of Prospect Medical Holdings, a private-equity-backed hospital chain whose three Connecticut hospitals became a years-long source of controversy before its bankruptcy.
Current Move: Implementing the nation's most detailed private-equity and REIT hospital-ownership disclosure and restriction regime, with attestation and REIT-control provisions taking effect through October 2026 and 2027.
Connecticut is the closest thing to a model bill other states are copying, per the Private Equity Stakeholder Project's own account of legislators elsewhere looking to it as a template.
Watch: Whether Illinois, which passed its own PE-healthcare bills in 2026, or other states adopt Connecticut's specific sale-leaseback and attestation mechanisms.
Private Equity Stakeholder ProjectOrgSupporting
Watchdog organization tracking private-equity healthcare transactions and lobbying for state-level disclosure and control legislation
Stake: Advancing transparency and accountability requirements on private equity ownership of hospitals and other healthcare facilities.
Leverage: Tracked 84 private equity health care bills across 24 states during the 2025-2026 legislative sessions and maintains the primary public tracker of private-equity hospital ownership, cited directly by state legislators drafting oversight bills.
Track Record: Its research and hospital tracker have been cited in state legislative debates in Connecticut, Illinois, and elsewhere as the evidentiary basis for new transaction-disclosure laws.
Current Move: Continuing to publish monthly private-equity healthcare acquisition tracking through 2026, including documentation of the Lifepoint-ScionHealth intra-Apollo hospital transfers.
Functions as the de facto public transparency layer that state CON boards and legislators themselves often lack the data infrastructure to produce independently.
Watch: Whether its 2026 hospital tracker update (July 2026) prompts further state legislation once the REIT-ownership data it newly incorporated becomes more widely cited.
Vanderbilt University Medical CenterOrgWildcard
Academic health system whose CON application for a new hospital was blocked by incumbent competitor objections
Stake: Seeking to open a new 42-bed hospital in Rutherford County, Tennessee, a project in the works since 2020.
Leverage: As an academic medical center with substantial capital and political standing, it represents a test case for whether even well-resourced, non-PE-backed systems can be blocked by the CON objection process that incumbents use against new entrants.
Track Record: Received initial state approval and a granted certificate of need, only to have a Tennessee administrative law judge block the opening after three existing providers intervened, claiming no need existed for the new facility.
Current Move: Its Rutherford County hospital had a tentative 2026 opening pending resolution of the incumbent providers' objection.
Vanderbilt's case is the clearest evidence that CON law's stated purpose — preventing unnecessary duplication — functions in practice as an incumbent veto over new entrants, regardless of applicant quality or need.
Watch: The final resolution of the Rutherford County CON dispute as a bellwether for how CON objection processes function even against well-capitalized nonprofit challengers.
Facts & Figures (9)
The claims behind this analysis, each with its verification status — including what is contested, unverified, or could not be established.
Apollo Global Management (via Lifepoint Health / ScionHealth) — Lifepoint operated at least 70 joint ventures with over 30 different nonprofit partners as of January 2026, and Apollo orchestrated a 2026 transaction moving eight ScionHealth community hospitals back to Lifepoint — both entities being Apollo-owned — giving Apollo direct control over facility footprint decisions across dozens of communities without a single conventional M&A filing.
Consolidating hospitals back onto the Lifepoint platform from ScionHealth in 2026 while continuing to expand joint ventures with nonprofit health systems as its primary growth vehicle.
✓ DOCUMENTED
Medical Properties Trust (MPT) — MPT held 373 properties across 51 operators, roughly 38,000 hospital beds, in 30 U.S. states and 9 countries as of June 30, 2026 — meaning it holds the underlying real estate for a hospital footprint the size of a mid-sized health system, and can set lease terms that determine whether a facility remains financially viable.
Executing a 'balance sheet de-leveraging offensive' following the Steward collapse, having transitioned 15 major hospitals to replacement operators while continuing to pursue new sale-leaseback deals internationally.
✓ DOCUMENTED
Tennessee General Assembly — Passed SB1369 on April 16, 2026 to repeal CON requirements for acute-care hospitals effective 2030, and separately passed a House measure (79-14 vote in April 2026) to let Ballad Health's Certificate of Public Advantage expire in 2028 — two votes that together determine whether an entire 20-hospital regional monopoly faces competition or continues operating under state protection.
Proceeding with COPA sunset and CON repeal legislation in 2026 despite a formal FTC warning that ending oversight without ensuring immediate competition risks price and quality harm.
✓ DOCUMENTED
Federal Trade Commission — Issued a formal public warning to Tennessee lawmakers in April 2026 that ending Ballad Health's COPA without ensuring immediate market competition risks price and quality harm, and has previously issued orders to five health insurance companies and two health systems to study COPA effects on price, quality, and wages.
Publicly pressuring the Tennessee legislature in 2026 to pair COPA termination with stronger competition safeguards rather than allowing an unregulated gap between COPA expiration and CON repeal.
✓ DOCUMENTED
State Certificate-of-Need boards and health departments — As of 2026, approximately 35 states and the District of Columbia still operate CON programs covering hospitals, meaning these boards hold a legal veto over new hospital construction across the majority of the country's population footprint.
Operating under active legislative rewrite pressure in 2026, including Mississippi's HB 3 raising the capital-expenditure CON threshold from $2 million to $5 million (signed February 4, 2026) and Tennessee's scheduled 2030 sunset for acute-care CON.
✓ DOCUMENTED
Ballad Health — Operates 20 hospitals across northeastern Tennessee and southwestern Virginia under a COPA that has, since 2018, displaced ordinary federal antitrust scrutiny of what would otherwise be an unambiguous hospital-market merger to monopoly.
Publicly defending its COPA and cooperative-agreement structure as the state legislature moves to let it expire in 2028, citing negotiated commitments to limit regional healthcare price growth below the national average.
✓ DOCUMENTED
Connecticut General Assembly — Its 2026 law requires hospitals to annually attest that no private equity firm holds controlling interest or influences clinical policy affecting triage, admission, or discharge decisions, and HB 5316 prohibits REITs from acquiring or increasing operational control over a hospital or health system starting October 1, 2026.
Implementing the nation's most detailed private-equity and REIT hospital-ownership disclosure and restriction regime, with attestation and REIT-control provisions taking effect through October 2026 and 2027.
✓ DOCUMENTED
Private Equity Stakeholder Project — Tracked 84 private equity health care bills across 24 states during the 2025-2026 legislative sessions and maintains the primary public tracker of private-equity hospital ownership, cited directly by state legislators drafting oversight bills.
Continuing to publish monthly private-equity healthcare acquisition tracking through 2026, including documentation of the Lifepoint-ScionHealth intra-Apollo hospital transfers.
✓ DOCUMENTED
Vanderbilt University Medical Center — As an academic medical center with substantial capital and political standing, it represents a test case for whether even well-resourced, non-PE-backed systems can be blocked by the CON objection process that incumbents use against new entrants.
Its Rutherford County hospital had a tentative 2026 opening pending resolution of the incumbent providers' objection.
✓ DOCUMENTED