Senate Study Bill 1117 - Introduced
SENATE FILE _____
BY (PROPOSED COMMITTEE ON
HEALTH AND HUMAN SERVICES
BILL BY CHAIRPERSON EDLER)
A BILL FOR
1 An Act relating to the certificate of need process.
2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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1 Section 1. Section 135.61, subsections 1, 14, 15, and 18,
2 Code 2023, are amended to read as follows:
3 1. “Affected persons” means, with respect to an application
4 for a certificate of need:
5 a. The person submitting the application.
6 b. Consumers who would be served by the new institutional
7 health service proposed in the application.
8 c. Each institutional health facility or health maintenance
9 organization which is located in the geographic area which
10 would appropriately be served by the new institutional
11 health service proposed in the application. The appropriate
12 geographic service area of each institutional health facility
13 or health maintenance organization shall be determined on a
14 uniform basis in accordance with criteria established in rules
15 adopted by the department.
16 d. Each institutional health facility or health maintenance
17 organization which, prior to receipt of the application by
18 the department, has formally indicated to the department
19 pursuant to this subchapter an intent to furnish in the future
20 institutional health services similar to the new institutional
21 health service proposed in the application.
22 e. Any other person designated as an affected person by
23 rules of the department.
24 f. Any payer or third-party payer for health services.
25 14. “Institutional health facility” means any of the
26 following, without regard to whether the facilities referred
27 to are publicly or privately owned or are organized for profit
28 or not or whether the facilities are part of or sponsored by a
29 health maintenance organization:
30 a. A hospital.
31 b. A health care facility.
32 c. An organized outpatient health facility.
33 d. An outpatient surgical facility.
34 e. A community mental health facility.
35 f. A birth center.
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1 15. “Institutional health service” means any health service
2 furnished in or through institutional health facilities or
3 health maintenance organizations, including mobile health
4 services.
5 18. “New institutional health service” or “changed
6 institutional health service” means any of the following:
7 a. The construction, development, or other establishment of
8 a new institutional health facility regardless of ownership.
9 b. Relocation of an institutional health facility.
10 c. Any capital expenditure, lease, or donation by or
11 on behalf of an institutional health facility in excess
12 of one five million five hundred thousand dollars within a
13 twelve-month period.
14 d. A permanent change in the bed capacity, as determined
15 by the department, of an institutional health facility. For
16 purposes of this paragraph, a change is permanent if it is
17 intended to be effective for one year or more.
18 e. Any expenditure in excess of five hundred thousand
19 dollars by or on behalf of an institutional health facility for
20 health services which are or will be offered in or through an
21 institutional health facility at a specific time but which were
22 not offered on a regular basis in or through that institutional
23 health facility within the twelve-month period prior to that
24 time.
25 f. The deletion of one or more health services, previously
26 offered on a regular basis by an institutional health facility
27 or health maintenance organization or the relocation of one or
28 more health services from one physical facility to another.
29 g. Any acquisition by or on behalf of a health care provider
30 or a group of health care providers of any piece of replacement
31 equipment with a value in excess of one million five hundred
32 thousand dollars, whether acquired by purchase, lease, or
33 donation.
34 h. Any acquisition by or on behalf of a health care provider
35 or group of health care providers of any piece of equipment
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1 with a value in excess of one million five hundred thousand
2 dollars, whether acquired by purchase, lease, or donation,
3 which results in the offering or development of a health
4 service not previously provided. A mobile service provided
5 on a contract basis is not considered to have been previously
6 provided by a health care provider or group of health care
7 providers.
8 i. Any acquisition by or on behalf of an institutional
9 health facility or a health maintenance organization of any
10 piece of replacement equipment with a value in excess of one
11 million five hundred thousand dollars, whether acquired by
12 purchase, lease, or donation.
13 j. Any acquisition by or on behalf of an institutional
14 health facility or health maintenance organization of any
15 piece of equipment with a value in excess of one million five
16 hundred thousand dollars, whether acquired by purchase, lease,
17 or donation, which results in the offering or development of
18 a health service not previously provided. A mobile service
19 provided on a contract basis is not considered to have been
20 previously provided by an institutional health facility.
21 k. Any air transportation service for transportation of
22 patients or medical personnel offered through an institutional
23 health facility at a specific time but which was not offered
24 on a regular basis in or through that institutional health
25 facility within the twelve-month period prior to the specific
26 time.
27 l. Any mobile health service with a value in excess of one
28 million five hundred thousand dollars.
29 m. Any of the following:
30 (1) Cardiac catheterization service.
31 (2) Open heart surgical service.
32 (3) Organ transplantation service.
33 (4) Radiation therapy service applying ionizing radiation
34 for the treatment of malignant disease using megavoltage
35 external beam equipment.
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1 Sec. 2. Section 135.61, subsections 2 and 16, Code 2023, are
2 amended by striking the subsections.
3 Sec. 3. Section 135.62, subsection 2, paragraphs a, b, and
4 c, Code 2023, are amended to read as follows:
5 a. Qualifications. The members of the council shall be
6 chosen so that the council as a whole is broadly representative
7 of various geographical areas of the state and no more than
8 three of its members are affiliated with the same political
9 party. Each council member shall be a person who has
10 demonstrated by prior activities an informed concern for the
11 planning and delivery of health services. A member of the
12 council and any spouse of a member shall not, during the
13 time that member is serving on the council, do either of the
14 following:
15 (1) Be a health care provider nor be otherwise directly or
16 indirectly engaged in the delivery of health care services nor
17 have a material financial interest in the providing or delivery
18 of health services.
19 (2) Serve as a member of any board or other policymaking
20 or advisory body of an institutional health facility, a health
21 maintenance organization, or any health or hospital insurer.
22 b. Appointments. Terms of council members shall be six
23 three years, beginning and ending as provided in section
24 69.19. A member shall be appointed in each odd-numbered
25 year to succeed each member whose term expires in that year.
26 Vacancies shall be filled by the governor for the balance of
27 the unexpired term. Each appointment to the council is subject
28 to confirmation by the senate. A council member is ineligible
29 for appointment to a second consecutive term, unless first
30 appointed to an unexpired term of three years or less.
31 c. Chairperson. The governor council shall designate one
32 of the council members as chairperson. That designation may
33 be changed not later than July 1 of any odd-numbered year,
34 effective on the date of the organizational meeting held in
35 that year under paragraph “d”.
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1 Sec. 4. Section 135.63, subsection 1, Code 2023, is amended
2 to read as follows:
3 1. A new institutional health service or changed
4 institutional health service shall not be offered or developed
5 in this state without prior application to the department
6 for and receipt of a certificate of need, pursuant to
7 this subchapter. The application shall be made upon forms
8 furnished or prescribed by the department and shall contain
9 such information as the department may require under this
10 subchapter. The application shall be accompanied by an
11 economic impact statement that includes information specified
12 by rule to assist the department and the council in the
13 evaluation of the application pursuant to section 135.64.
14 The application shall be accompanied by a fee equivalent to
15 three-tenths of one percent of the anticipated cost of the
16 project with a minimum fee of six hundred dollars and a maximum
17 fee of twenty-one of one thousand dollars. The fee shall be
18 remitted by the department to the treasurer of state, who shall
19 place it in the general fund of the state. If an application
20 is voluntarily withdrawn within thirty calendar days after
21 submission, seventy-five percent of the application fee shall
22 be refunded; if the application is voluntarily withdrawn more
23 than thirty but within sixty days after submission, fifty
24 percent of the application fee shall be refunded; if the
25 application is withdrawn voluntarily more than sixty days
26 after submission, twenty-five percent of the application fee
27 shall be refunded. Notwithstanding the required payment of
28 an application fee under this subsection, an applicant for a
29 new institutional health service or a changed institutional
30 health service offered or developed by an intermediate care
31 facility for persons with an intellectual disability or an
32 intermediate care facility for persons with mental illness as
33 defined pursuant to section 135C.1 is exempt from payment of
34 the application fee.
35 Sec. 5. Section 135.63, subsection 2, paragraphs a and e,
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1 Code 2023, are amended to read as follows:
2 a. Private offices and private clinics of an individual
3 physician, dentist, or other practitioner or group of
4 health care providers, except as provided by section 135.61,
5 subsection 18, paragraphs “g”, “h”, and “m”, and section 135.61,
6 subsections 20 and 21.
7 e. A health maintenance organization or combination of
8 health maintenance organizations or an institutional health
9 facility controlled directly or indirectly by a health
10 maintenance organization or combination of health maintenance
11 organizations, except when the health maintenance organization
12 or combination of health maintenance organizations does any of
13 the following:
14 (1) Constructs constructs, develops, renovates, relocates,
15 or otherwise establishes an institutional health facility.
16 (2) Acquires major medical equipment as provided by section
17 135.61, subsection 18, paragraphs “i” and “j”.
18 Sec. 6. Section 135.63, subsection 2, paragraph h, Code
19 2023, is amended by striking the paragraph.
20 Sec. 7. Section 135.63, subsection 4, unnumbered paragraph
21 1, Code 2023, is amended to read as follows:
22 A copy of the application shall be sent to the department
23 of human services at the time the application is submitted to
24 the Iowa department of public health. The department shall not
25 process applications for and the council shall not consider a
26 new or changed institutional health service for an intermediate
27 care facility for persons with an intellectual disability
28 unless both of the following conditions are met:
29 Sec. 8. Section 135.66, subsections 1 and 2, Code 2023, are
30 amended to read as follows:
31 1. a. Within fifteen business days after receipt of an
32 application for a certificate of need, the department shall
33 examine the application for form and completeness and accept
34 or reject it. An application shall be rejected only if it
35 fails to provide all information required by the department
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1 pursuant to section 135.63, subsection 1. The department shall
2 promptly return to the applicant any rejected application, with
3 an explanation of the reasons for its rejection.
4 b. Within thirty days after notifying the applicant of
5 rejection of the application, the applicant may resubmit a
6 revised application for review under this subsection and shall
7 not be subject to payment of another required application
8 fee pursuant to section 135.63. If a subsequent rejection
9 is issued, the applicant shall resubmit the application in
10 accordance with and shall be subject to the procedure and
11 requirements for an initial application.
12 2. Upon acceptance of an application for a certificate
13 of need, the department shall promptly undertake to notify
14 all affected persons in writing that formal review of the
15 application has been initiated. Notification to those affected
16 persons who are consumers or third-party payers or other
17 payers for health services may be provided by distribution of
18 the pertinent information to the news media by an electronic
19 distribution method available to the department.
20 Sec. 9. Section 135.67, subsection 1, Code 2023, is amended
21 to read as follows:
22 1. The department may waive the letter of intent procedures
23 prescribed by section 135.65 and substitute conduct a summary
24 review procedure, which shall be established by rules of the
25 department, when it accepts an application for a certificate of
26 need for a project which meets any of the following criteria
27 in paragraphs “a” through “e”:
28 a. A project which is limited to repair or replacement of a
29 facility or equipment damaged or destroyed by a disaster, and
30 which will not expand the facility nor increase the services
31 provided beyond the level existing prior to the disaster.
32 b. A project necessary to enable the facility or service to
33 achieve or maintain compliance with federal, state, or other
34 appropriate licensing, certification, or safety requirements.
35 c. A project which will not change the existing bed capacity
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1 of the applicant’s facility or service, as determined by the
2 department, by more than ten percent or ten beds, whichever is
3 less, over a two-year period.
4 d. A project the total cost of which will not exceed one
5 hundred fifty thousand dollars.
6 e. d. Any other project for which the applicant proposes
7 and the department agrees to summary review.
8 Sec. 10. Section 135.69, Code 2023, is amended to read as
9 follows:
10 135.69 Council to make final decision.
11 1. The department shall complete its formal review of
12 the application within ninety thirty days after acceptance
13 of the application, except as otherwise provided by section
14 135.72, subsection 4. Upon completion of the formal review,
15 the council shall approve or deny the application. The council
16 shall issue written findings stating the basis for its decision
17 on the application, and the department shall send copies of
18 the council’s decision and the written findings supporting
19 the decision to the applicant and to any other person who so
20 requests.
21 2. Failure by the council to issue a written decision on an
22 application for a certificate of need within the time required
23 by this section shall constitute denial approval of and final
24 administrative action on the application.
25 Sec. 11. Section 135.72, subsection 4, Code 2023, is amended
26 to read as follows:
27 4. Criteria for determining when it is not feasible to
28 complete formal review of an application for a certificate of
29 need within the time limits specified in section 135.69. The
30 rules adopted under this subsection shall include criteria for
31 determinin