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HF 1529

1st Division Engrossment - 92nd Legislature (2021 - 2022) Posted on 03/11/2021 02:00pm

KEY: stricken = removed, old language.
underscored = added, new language.

Bill Text Versions

Engrossments
Introduction Posted on 02/25/2021
Division Engrossments
1st Division Engrossment Posted on 03/11/2021

Current Version - 1st Division Engrossment

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A bill for an act
relating to health; modifying hospital bed license transfer requirements following
a hospital closure; establishing monitoring and enforcement of hospital construction
moratorium exception conditions; amending Minnesota Statutes 2020, sections
144.55, subdivisions 4, 6; 144.551, subdivision 1, by adding a subdivision.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2020, section 144.55, subdivision 4, is amended to read:


Subd. 4.

Routine inspections; presumption.

Any hospital surveyed and accredited
under the standards of the hospital accreditation program of an approved accrediting
organization that submits to the commissioner within a reasonable time copies of (a) its
currently valid accreditation certificate and accreditation letter, together with accompanying
recommendations and comments and (b) any further recommendations, progress reports
and correspondence directly related to the accreditation is presumed to comply with
application requirements of subdivision 1 and the standards requirements of subdivision 3
and no further routine inspections or accreditation information shall be required by the
commissioner to determine compliance. Notwithstanding the provisions of sections 144.54
and 144.653, subdivisions 2 and 4, hospitals shall be inspected only as provided in this
section. The provisions of section 144.653 relating to the assessment and collection of fines
shall not apply to any hospital. The commissioner of health shall annually conduct, with
notice, validation inspections of a selected sample of the number of hospitals accredited by
an approved accrediting organization, not to exceed ten percent of accredited hospitals, for
the purpose of determining compliance with the provisions of subdivision 3. If a validation
survey discloses a failure to comply with subdivision 3, the provisions of section 144.653
relating to correction orders, reinspections, and notices of noncompliance shall apply. The
commissioner shall also conduct any inspection necessary to determine whether hospital
construction, addition, or remodeling projects comply with standards for construction
promulgated in rules pursuant to subdivision 3. new text begin The commissioner shall also conduct any
inspections necessary to determine whether a hospital or hospital corporate system continues
to satisfy the conditions on which a hospital construction moratorium exception was granted
under section 144.551.
new text end Pursuant to section 144.653, the commissioner shall inspect any
hospital that does not have a currently valid hospital accreditation certificate from an
approved accrediting organization. Nothing in this subdivision shall be construed to limit
the investigative powers of the Office of Health Facility Complaints as established in sections
144A.51 to 144A.54.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2021.
new text end

Sec. 2.

Minnesota Statutes 2020, section 144.55, subdivision 6, is amended to read:


Subd. 6.

Suspension, revocation, and refusal to renew.

(a) The commissioner may
refuse to grant or renew, or may suspend or revoke, a license on any of the following grounds:

(1) violation of any of the provisions of sections 144.50 to 144.56 or the rules or standards
issued pursuant thereto, or Minnesota Rules, chapters 4650 and 4675;

(2) permitting, aiding, or abetting the commission of any illegal act in the institution;

(3) conduct or practices detrimental to the welfare of the patient; or

(4) obtaining or attempting to obtain a license by fraud or misrepresentation; or

(5) with respect to hospitals and outpatient surgical centers, if the commissioner
determines that there is a pattern of conduct that one or more physicians or advanced practice
registered nurses who have a "financial or economic interest," as defined in section 144.6521,
subdivision 3
, in the hospital or outpatient surgical center, have not provided the notice and
disclosure of the financial or economic interest required by section 144.6521.

(b) The commissioner shall not renew a license for a boarding care bed in a resident
room with more than four beds.

new text begin (c) The commissioner shall not renew licenses for hospital beds issued to a hospital or
hospital corporate system pursuant to a hospital construction moratorium exception under
section 144.551 if the commissioner determines the hospital or hospital corporate system
is not satisfying the conditions on which the exception was granted.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for license renewals occurring on or after
July 1, 2021.
new text end

Sec. 3.

Minnesota Statutes 2020, section 144.551, subdivision 1, is amended to read:


Subdivision 1.

Restricted construction or modification.

(a) The following construction
or modification may not be commenced:

(1) any erection, building, alteration, reconstruction, modernization, improvement,
extension, lease, or other acquisition by or on behalf of a hospital that increases the bed
capacity of a hospital, relocates hospital beds from one physical facility, complex, or site
to another, or otherwise results in an increase or redistribution of hospital beds within the
state; and

(2) the establishment of a new hospital.

(b) This section does not apply to:

(1) construction or relocation within a county by a hospital, clinic, or other health care
facility that is a national referral center engaged in substantial programs of patient care,
medical research, and medical education meeting state and national needs that receives more
than 40 percent of its patients from outside the state of Minnesota;

(2) a project for construction or modification for which a health care facility held an
approved certificate of need on May 1, 1984, regardless of the date of expiration of the
certificate;

(3) a project for which a certificate of need was denied before July 1, 1990, if a timely
appeal results in an order reversing the denial;

(4) a project exempted from certificate of need requirements by Laws 1981, chapter 200,
section 2;

(5) a project involving consolidation of pediatric specialty hospital services within the
Minneapolis-St. Paul metropolitan area that would not result in a net increase in the number
of pediatric specialty hospital beds among the hospitals being consolidated;

(6) a project involving the temporary relocation of pediatric-orthopedic hospital beds to
an existing licensed hospital that will allow for the reconstruction of a new philanthropic,
pediatric-orthopedic hospital on an existing site and that will not result in a net increase in
the number of hospital beds. Upon completion of the reconstruction, the licenses of both
hospitals must be reinstated at the capacity that existed on each site before the relocation;

(7) the relocation or redistribution of hospital beds within a hospital building or
identifiable complex of buildings provided the relocation or redistribution does not result
in: (i) an increase in the overall bed capacity at that site; (ii) relocation of hospital beds from
one physical site or complex to another; or (iii) redistribution of hospital beds within the
state or a region of the state;

(8) relocation or redistribution of hospital beds within a hospital corporate system that
involves the transfer of beds from a closed facility site or complex to an existing site or
complex provided that: (i) no more than 50 percent of the capacity of the closed facility is
transferred; (ii) the capacity of the site or complex to which the beds are transferred does
not increase by more than 50 percent; (iii) the beds are not transferred outside of a federal
health systems agency boundary in place on July 1, 1983; deleted text begin anddeleted text end (iv) the relocation or
redistribution does not involve the construction of a new hospital building;new text begin and (v) the
transferred beds are used first to replace within the hospital corporate system the total number
of beds previously used in the closed facility site or complex for mental health services and
substance use disorder services. Only after the hospital corporate system has fulfilled the
requirements of item (v) may the remainder of the available capacity of the closed facility
site or complex be transferred for any other purpose;
new text end

(9) a construction project involving up to 35 new beds in a psychiatric hospital in Rice
County that primarily serves adolescents and that receives more than 70 percent of its
patients from outside the state of Minnesota;

(10) a project to replace a hospital or hospitals with a combined licensed capacity of
130 beds or less if: (i) the new hospital site is located within five miles of the current site;
and (ii) the total licensed capacity of the replacement hospital, either at the time of
construction of the initial building or as the result of future expansion, will not exceed 70
licensed hospital beds, or the combined licensed capacity of the hospitals, whichever is less;

(11) the relocation of licensed hospital beds from an existing state facility operated by
the commissioner of human services to a new or existing facility, building, or complex
operated by the commissioner of human services; from one regional treatment center site
to another; or from one building or site to a new or existing building or site on the same
campus;

(12) the construction or relocation of hospital beds operated by a hospital having a
statutory obligation to provide hospital and medical services for the indigent that does not
result in a net increase in the number of hospital beds, notwithstanding section 144.552, 27
beds, of which 12 serve mental health needs, may be transferred from Hennepin County
Medical Center to Regions Hospital under this clause;

(13) a construction project involving the addition of up to 31 new beds in an existing
nonfederal hospital in Beltrami County;

(14) a construction project involving the addition of up to eight new beds in an existing
nonfederal hospital in Otter Tail County with 100 licensed acute care beds;

(15) a construction project involving the addition of 20 new hospital beds in an existing
hospital in Carver County serving the southwest suburban metropolitan area;

(16) a project for the construction or relocation of up to 20 hospital beds for the operation
of up to two psychiatric facilities or units for children provided that the operation of the
facilities or units have received the approval of the commissioner of human services;

(17) a project involving the addition of 14 new hospital beds to be used for rehabilitation
services in an existing hospital in Itasca County;

(18) a project to add 20 licensed beds in existing space at a hospital in Hennepin County
that closed 20 rehabilitation beds in 2002, provided that the beds are used only for
rehabilitation in the hospital's current rehabilitation building. If the beds are used for another
purpose or moved to another location, the hospital's licensed capacity is reduced by 20 beds;

(19) a critical access hospital established under section 144.1483, clause (9), and section
1820 of the federal Social Security Act, United States Code, title 42, section 1395i-4, that
delicensed beds since enactment of the Balanced Budget Act of 1997, Public Law 105-33,
to the extent that the critical access hospital does not seek to exceed the maximum number
of beds permitted such hospital under federal law;

(20) notwithstanding section 144.552, a project for the construction of a new hospital
in the city of Maple Grove with a licensed capacity of up to 300 beds provided that:

(i) the project, including each hospital or health system that will own or control the entity
that will hold the new hospital license, is approved by a resolution of the Maple Grove City
Council as of March 1, 2006;

(ii) the entity that will hold the new hospital license will be owned or controlled by one
or more not-for-profit hospitals or health systems that have previously submitted a plan or
plans for a project in Maple Grove as required under section 144.552, and the plan or plans
have been found to be in the public interest by the commissioner of health as of April 1,
2005;

(iii) the new hospital's initial inpatient services must include, but are not limited to,
medical and surgical services, obstetrical and gynecological services, intensive care services,
orthopedic services, pediatric services, noninvasive cardiac diagnostics, behavioral health
services, and emergency room services;

(iv) the new hospital:

(A) will have the ability to provide and staff sufficient new beds to meet the growing
needs of the Maple Grove service area and the surrounding communities currently being
served by the hospital or health system that will own or control the entity that will hold the
new hospital license;

(B) will provide uncompensated care;

(C) will provide mental health services, including inpatient beds;

(D) will be a site for workforce development for a broad spectrum of health-care-related
occupations and have a commitment to providing clinical training programs for physicians
and other health care providers;

(E) will demonstrate a commitment to quality care and patient safety;

(F) will have an electronic medical records system, including physician order entry;

(G) will provide a broad range of senior services;

(H) will provide emergency medical services that will coordinate care with regional
providers of trauma services and licensed emergency ambulance services in order to enhance
the continuity of care for emergency medical patients; and

(I) will be completed by December 31, 2009, unless delayed by circumstances beyond
the control of the entity holding the new hospital license; and

(v) as of 30 days following submission of a written plan, the commissioner of health
has not determined that the hospitals or health systems that will own or control the entity
that will hold the new hospital license are unable to meet the criteria of this clause;

(21) a project approved under section 144.553;

(22) a project for the construction of a hospital with up to 25 beds in Cass County within
a 20-mile radius of the state Ah-Gwah-Ching facility, provided the hospital's license holder
is approved by the Cass County Board;

(23) a project for an acute care hospital in Fergus Falls that will increase the bed capacity
from 108 to 110 beds by increasing the rehabilitation bed capacity from 14 to 16 and closing
a separately licensed 13-bed skilled nursing facility;

(24) notwithstanding section 144.552, a project for the construction and expansion of a
specialty psychiatric hospital in Hennepin County for up to 50 beds, exclusively for patients
who are under 21 years of age on the date of admission. The commissioner conducted a
public interest review of the mental health needs of Minnesota and the Twin Cities
metropolitan area in 2008. No further public interest review shall be conducted for the
construction or expansion project under this clause;

(25) a project for a 16-bed psychiatric hospital in the city of Thief River Falls, if the
commissioner finds the project is in the public interest after the public interest review
conducted under section 144.552 is complete;

(26)(i) a project for a 20-bed psychiatric hospital, within an existing facility in the city
of Maple Grove, exclusively for patients who are under 21 years of age on the date of
admission, if the commissioner finds the project is in the public interest after the public
interest review conducted under section 144.552 is complete;

(ii) this project shall serve patients in the continuing care benefit program under section
256.9693. The project may also serve patients not in the continuing care benefit program;
and

(iii) if the project ceases to participate in the continuing care benefit program, the
commissioner must complete a subsequent public interest review under section 144.552. If
the project is found not to be in the public interest, the license must be terminated six months
from the date of that finding. If the commissioner of human services terminates the contract
without cause or reduces per diem payment rates for patients under the continuing care
benefit program below the rates in effect for services provided on December 31, 2015, the
project may cease to participate in the continuing care benefit program and continue to
operate without a subsequent public interest review;

(27) a project involving the addition of 21 new beds in an existing psychiatric hospital
in Hennepin County that is exclusively for patients who are under 21 years of age on the
date of admission; deleted text begin or
deleted text end

(28) a project to add 55 licensed beds in an existing safety net, level I trauma center
hospital in Ramsey County as designated under section 383A.91, subdivision 5, of which
15 beds are to be used for inpatient mental health and 40 are to be used for other services.
In addition, five unlicensed observation mental health beds shall be addeddeleted text begin .deleted text end new text begin ; or
new text end

new text begin (29) the addition of licensed beds in a hospital or hospital corporate system to primarily
provide mental health services or substance use disorder services. In order to add beds under
this clause, a hospital must have an emergency department and must not be a hospital that
solely provides treatment to adults for mental illnesses or substance use disorders. Beds
added under this clause must be available to serve medical assistance and MinnesotaCare
enrollees. Notwithstanding section 144.552, public interest review shall not be required for
an addition of beds under this clause.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4.

Minnesota Statutes 2020, section 144.551, is amended by adding a subdivision to
read:


new text begin Subd. 5. new text end

new text begin Monitoring. new text end

new text begin The commissioner shall monitor the implementation of exceptions
under this section. Each hospital or hospital corporate system granted an exception under
this section shall submit to the commissioner each year a report on how the hospital or
hospital corporate system continues to satisfy the conditions on which the exception was
granted.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2021.
new text end