Skip to main content Skip to office menu Skip to footer
Minnesota Legislature

Office of the Revisor of Statutes

144.581 HOSPITAL AUTHORITIES.
    Subdivision 1. Nonprofit corporation powers. A municipality, political subdivision, state
agency, or other governmental entity that owns or operates a hospital authorized, organized, or
operated under chapters 158, 250, 376, and 397, or under sections 246A.01 to 246A.27, 412.221,
447.05 to 447.13, 447.31, or 471.59, or under any special law authorizing or establishing a
hospital or hospital district shall, relative to the delivery of health care services, have, in addition
to any authority vested by law, the authority and legal capacity of a nonprofit corporation under
chapter 317A, including authority to
(a) enter shared service and other cooperative ventures,
(b) join or sponsor membership in organizations intended to benefit the hospital or hospitals
in general,
(c) enter partnerships,
(d) incorporate other corporations,
(e) have members of its governing authority or its officers or administrators serve as
directors, officers, or employees of the ventures, associations, or corporations,
(f) own shares of stock in business corporations,
(g) offer, directly or indirectly, products and services of the hospital, organization,
association, partnership, or corporation to the general public, and
(h) expend funds, including public funds in any form, or devote the resources of the hospital
or hospital district to recruit or retain physicians whose services are necessary or desirable for
meeting the health care needs of the population, and for successful performance of the hospital
or hospital district's public purpose of the promotion of health. Allowable uses of funds and
resources include the retirement of medical education debt, payment of one-time amounts in
consideration of services rendered or to be rendered, payment of recruitment expenses, payment
of moving expenses, and the provision of other financial assistance necessary for the recruitment
and retention of physicians, provided that the expenditures in whatever form are reasonable under
the facts and circumstances of the situation.
    Subd. 2. Use of hospital funds for corporate projects. In the event that the municipality,
political subdivision, state agency, or other governmental entity provides direct financial subsidy
to the hospital from tax revenue at the time an undertaking authorized under subdivision 1, clauses
(a) to (g), is established or funded, the hospital may not contribute funds to the undertaking for
more than three years and thereafter all funds must be repaid, with interest in no more than
ten years.
    Subd. 3. Converting public funds for individual benefit. The conversion of public funds
for the benefit of any individual shall constitute grounds for review and action by the attorney
general or the county attorney under section 609.54.
    Subd. 4. Other laws governing hospital board. The execution of the functions of the board
of directors of a hospital by an organization established under this section shall be subject to the
public purchasing requirements of section 471.345, the Open Meeting Law, chapter 13D, and
the Data Practices Act, chapter 13.
    Subd. 5. Closed meetings; recording. (a) Notwithstanding subdivision 4 or chapter 13D, a
public hospital or an organization established under this section may hold a closed meeting
to discuss specific marketing activity and contracts that might be entered into pursuant to the
marketing activity in cases where the hospital or organization is in competition with health care
providers that offer similar goods or services, and where disclosure of information pertaining
to those matters would cause harm to the competitive position of the hospital or organization,
provided that the goods or services do not require a tax levy. No contracts referred to in this
paragraph may be entered into earlier than 15 days after the proposed contract has been described
at a public meeting and the description entered in the minutes, except for contracts for consulting
services or with individuals for personal services.
(b) A meeting may not be closed under paragraph (a) except by a majority vote of the board
of directors in a public meeting. The time and place of the closed meeting must be announced at
the public meeting. A written roll of members present at the closed meeting must be available to
the public after the closed meeting. The proceedings of a closed meeting must be tape-recorded
and preserved by the board of directors for two years. The data on the tape are nonpublic data
under section 13.02, subdivision 9. However, the data become public data under section 13.02,
subdivision 14
, two years after the meeting, or when the hospital or organization takes action
on matters referred to in paragraph (a), except for contracts for consulting services. In the case
of personal service contracts, the data become public when the contract is signed. For entities
subject to section 471.345, a contract entered into by the board is subject to the requirements
of section 471.345.
(c) The board of directors may not discuss a tax levy, bond issuance, or other expenditure
of money unless the expenditure is directly related to specific marketing activities and contracts
described in paragraph (a) at a closed meeting.
History: 1984 c 554 s 1; 1984 c 655 art 2 s 15 subd 1; 1987 c 384 art 2 s 1; 1989 c 304
s 137; 1989 c 351 s 15; 1990 c 568 art 2 s 9; 1992 c 549 art 5 s 13; 1994 c 618 art 1 s 21;
1994 c 625 art 8 s 44