IVCA Provides Updates for State Legislative Issues – 04/15/2026

IVCA Illinois Legislative Report
David Stricklin, IVCA Legislative Liaison, Stricklin & Associates

IVCA WORKS ON LEGISLATION TARGETING PE

Two bills working their way through the Illinois General Assembly have been the focus of our advocacy efforts so far this session.

HB 5487 is legislation promoted by the Illinois Trial Lawyers Association and supported by the Illinois State Bar Association to address what they see as threats to legal independence by Management Service Organizations or Alternative Business Structures in law firms. Some PE firms, law firms and accounting firms are evaluating this opportunity, but the trial lawyers particularly are opposed. The bill was amended in committee to take out the words “private equity” and “hedge fund” and replace with language referring to non-lawyers. This is an improvement in the bill and addresses much of our opposition.

House Committee Amendment No. 1

Replaces everything after the enacting clause. Reinserts provisions in the bill as introduced with these changes. Deletes references to “hedge fund” and “private equity group” and makes the Act applicable to “an entity owned, operated, or controlled in whole or in part by persons not licensed as attorneys”. Prohibits such an entity from accessing, owning, or determining the content of client records or accessing any attorney-client communications. Makes conforming changes. Effective immediately.

The House bill is not in the Senate, which declined to hear the Senate version of the same bill earlier in the session. It remains to be seen if the bill will move through committee and onto the Senate floor. We are keeping a close watch.

A second measure gives the Illinois Attorney General slightly expanded powers to monitor health care transactions. HB 5000 clarifies that transactions between private entities are covered in the bill and expressly uses the term private equity. This bill, promoted as simply clarifying statute, and the one above, are clear indications that regulating PE is on the minds of policy makers! HB 5000 seems certain to pass and then go to the Governor.

Amends provisions requiring health care entities to notify the Attorney General within 30 days before a merger or affiliation to include a “covered transaction” even if the parties to the transaction are not themselves a health care facility or provider organization but own or control, directly or indirectly, one or more of the 2 or more health care facilities or provider organizations that will be under common ownership or contracting affiliation if the transaction is consummated, including if parties to the covered transaction are private equity companies. Defines “private equity company” to mean any company or partnership that collects capital investments from individuals or entities and purchases, as a parent company, at any level of corporate ownership, or through another entity or entities so that the company completely or partially owns or controls, a direct or indirect ownership share of an Illinois health care entity or an out-of-state health care entity that generates $10,000,000 or more in annual revenue from patients residing in this State.