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SF 2892

1st Engrossment - 90th Legislature (2017 - 2018) Posted on 05/19/2018 12:16pm

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

Current Version - 1st Engrossment

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A bill for an act
relating to health; adding a project to the hospital construction moratorium
exception; imposing deadlines on the public interest review process; amending
Minnesota Statutes 2016, section 144.552; Minnesota Statutes 2017 Supplement,
section 144.551, subdivision 1.

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

Section 1.

Minnesota Statutes 2017 Supplement, 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; and (iv) the relocation or
redistribution does not involve the construction of a new hospital building;

(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 used for
rehabilitation services in an existing hospital in Carver County serving the southwest
suburban metropolitan area. Beds constructed under this clause shall not be eligible for
reimbursement under medical assistance or MinnesotaCare;

(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; deleted text begin or
deleted text end

(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 admissiondeleted text begin .deleted text end new text begin ; or
new text end

new text begin (28) a project to add 100 licensed beds in an existing safety net, level I trauma center
hospital in Ramsey County if the commissioner finds the project to be in the public interest
after completing the public interest review required by section 144.552.
new text end

Sec. 2.

Minnesota Statutes 2016, section 144.552, is amended to read:


144.552 PUBLIC INTEREST REVIEW.

(a) The following entities must submit a plan to the commissioner:

(1) a hospital seeking to increase its number of licensed beds; or

(2) an organization seeking to obtain a hospital license and notified by the commissioner
under section 144.553, subdivision 1, paragraph (c), that it is subject to this section.

The plan must include information that includes an explanation of how the expansion will
meet the public's interest. When submitting a plan to the commissioner, an applicant shall
pay the commissioner for the commissioner's cost of reviewing and monitoring the plan,
as determined by the commissioner and notwithstanding section 16A.1283. Money received
by the commissioner under this section is appropriated to the commissioner for the purpose
of administering this section.new text begin For a hospital that is seeking an exception to the moratorium
under section 144.551, the plan must be submitted to the commissioner no later than August
1 of the calendar year prior to the year when the exception will be considered by the
legislature.
new text end

(b) Plans submitted under this section shall include detailed information necessary for
the commissioner to review the plan and reach a finding. The commissioner may request
additional information from the hospital submitting a plan under this section and from others
affected by the plan that the commissioner deems necessary to review the plan and make a
finding.new text begin If the commissioner determines that additional information is required from the
hospital submitting a plan under this section, the commissioner shall notify the hospital of
the additional information required no more than 30 days after the initial submission of the
plan.
new text end

(c) The commissioner shall review the plan and, within 90 days, but no more than six
months if extenuating circumstances apply, issue a finding on whether the plan is in the
public interest. In making the recommendation, the commissioner shall consider issues
including but not limited to:

(1) whether the new hospital or hospital beds are needed to provide timely access to care
or access to new or improved services;

(2) the financial impact of the new hospital or hospital beds on existing acute-care
hospitals that have emergency departments in the region;

(3) how the new hospital or hospital beds will affect the ability of existing hospitals in
the region to maintain existing staff;

(4) the extent to which the new hospital or hospital beds will provide services to
nonpaying or low-income patients relative to the level of services provided to these groups
by existing hospitals in the region; and

(5) the views of affected parties.

(d) If the plan is being submitted by an existing hospital seeking authority to construct
a new hospital, the commissioner shall also consider:

(1) the ability of the applicant to maintain the applicant's current level of community
benefit as defined in section 144.699, subdivision 5, at the existing facility; and

(2) the impact on the workforce at the existing facility including the applicant's plan for:

(i) transitioning current workers to the new facility;

(ii) retraining and employment security for current workers; and

(iii) addressing the impact of layoffs at the existing facility on affected workers.

(e) Prior to making a recommendation, the commissioner shall conduct a public hearing
in the affected hospital service area to take testimony from interested persons.

(f) Upon making a recommendation under paragraph (c), the commissioner shall provide
a copy of the recommendation to the chairs of the house of representatives and senate
committees having jurisdiction over health and human services policy and finance.

(g) If an exception to the moratorium is approved under section 144.551 after a review
under this section, the commissioner shall monitor the implementation of the exception up
to completion of the construction project. Thirty days after completion of the construction
project, the hospital shall submit to the commissioner a report on how the construction has
met the provisions of the plan originally submitted under the public interest review process
or a plan submitted pursuant to section 144.551, subdivision 1, paragraph (b), clause (20).