Connecticut Seal

General Assembly

 

Raised Bill No. 5215

February Session, 2018

 

LCO No. 1031

 

*01031_______PH_*

Referred to Committee on PUBLIC HEALTH

 

Introduced by:

 

(PH)

 

AN ACT CONCERNING THE DEPARTMENT OF PUBLIC HEALTH'S RECOMMENDATIONS REGARDING REVISIONS TO THE OFFICE OF HEALTH CARE ACCESS STATUTES.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Section 19a-639a of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2018):

(a) An application for a certificate of need shall be filed with the office in accordance with the provisions of this section and any regulations adopted by the Department of Public Health. The application shall address the guidelines and principles set forth in (1) subsection (a) of section 19a-639, and (2) regulations adopted by the department. The applicant shall include with the application a nonrefundable application fee of five hundred dollars. If the application concerns the transfer of ownership of a hospital, the applicant shall include in a single application all information related to all supplemental transactions associated with such transfer of ownership that would otherwise require a separate application for a certificate of need.

(b) Prior to the filing of a certificate of need application, the applicant shall publish notice that an application is to be submitted to the office in a newspaper having a substantial circulation in the area where the project is to be located. Such notice shall (1) be published (A) not later than twenty days prior to the date of filing of the certificate of need application, and (B) for not less than three consecutive days, and (2) contain a brief description of the nature of the project and the street address where the project is to be located. An applicant shall file the certificate of need application with the office not later than ninety days after publishing notice of the application in accordance with the provisions of this subsection. The office shall not accept the applicant's certificate of need application for filing unless the application is accompanied by the application fee prescribed in subsection (a) of this section and proof of compliance with the publication requirements prescribed in this subsection.

(c) (1) Not later than five business days after receipt of a properly filed certificate of need application, the office shall publish notice of the application on its Internet web site. Not later than thirty days after the date of filing of the application, the office may request such additional information as the office determines necessary to complete the application. In addition to any information requested by the office, if the application involves the transfer of ownership of a hospital, as defined in section 19a-639, as amended by this act, the applicant shall submit to the office (A) a plan demonstrating how health care services will be provided by the new hospital for the first three years following the transfer of ownership of the hospital, including any consolidation, reduction, elimination or expansion of existing services or introduction of new services, and (B) the names of persons currently holding a position with the hospital to be purchased or the purchaser, as defined in section 19a-639, as amended by this act, as an officer, director, board member or senior manager, whether or not such person is expected to hold a position with the hospital after completion of the transfer of ownership of the hospital and any salary, severance, stock offering or any financial gain, current or deferred, such person is expected to receive as a result of, or in relation to, the transfer of ownership of the hospital.

(2) The applicant shall, not later than sixty days after the date of the office's request, submit any requested information and any information required under this subsection to the office. If an applicant fails to submit such information to the office within the sixty-day period, the office shall consider the application to have been withdrawn.

(d) Upon determining that an application is complete, the office shall provide notice of this determination to the applicant and to the public in accordance with regulations adopted by the department. In addition, the office shall post such notice on its Internet web site. The date on which the office posts such notice on its Internet web site shall begin the review period. Except as provided in this subsection, (1) the review period for a completed application shall be ninety days from the date on which the office posts such notice on its Internet web site; and (2) the office shall issue a decision on a completed application prior to the expiration of the ninety-day review period. The review period for a completed application that involves a transfer of a large group practice, as described in subdivision (3) of subsection (a) of section 19a-638, when the offer was made in response to a request for proposal or similar voluntary offer for sale, shall be sixty days from the date on which the office posts notice on its Internet web site. Upon request or for good cause shown, the office may extend the review period for a period of time not to exceed sixty days. If the review period is extended, the office shall issue a decision on the completed application prior to the expiration of the extended review period. If the office holds a public hearing concerning a completed application in accordance with subsection (e) or (f) of this section, the office shall issue a decision on the completed application not later than sixty days after the date the office closes the public hearing record.

(e) Except as provided in this subsection, the office shall hold a public hearing on a properly filed and completed certificate of need application if three or more individuals or an individual representing an entity with five or more people submits a request, in writing, that a public hearing be held on the application. For a properly filed and completed certificate of need application involving a transfer of ownership of a large group practice, as described in subdivision (3) of subsection (a) of section 19a-638, when an offer was made in response to a request for proposal or similar voluntary offer for sale, a public hearing shall be held if twenty-five or more individuals or an individual representing twenty-five or more people submits a request, in writing, that a public hearing be held on the application. Any request for a public hearing shall be made to the office not later than thirty days after the date the office determines the application to be complete.

(f) (1) The office shall hold a public hearing with respect to each certificate of need application filed pursuant to section 19a-638 after December 1, 2015, that concerns any transfer of ownership involving a hospital. Such hearing shall be held in the municipality in which the hospital that is the subject of the application is located.

(2) The office may hold a public hearing with respect to any certificate of need application submitted under this chapter. The office shall provide not less than two weeks' advance notice to the applicant, in writing, and to the public by publication in a newspaper having a substantial circulation in the area served by the health care facility or provider. In conducting its activities under this chapter, the office may hold hearing on applications of a similar nature at the same time.

(g) (1) Notwithstanding the provisions of section 4-177a, any person who contests a certificate of need application and seeks party or intervenor status shall submit a written petition to the office not less than fourteen days prior to the date of the public hearing with respect to such application.

(2) Any person granted party or intervenor status under this subsection shall submit written testimony to the office not less than ten days prior to the date of the public hearing with respect to the certificate of need application.

(3) The office may waive the requirements of this subsection at any time upon a showing of good cause.

[(g)] (h) The Commissioner of Public Health may implement policies and procedures necessary to administer the provisions of this section while in the process of adopting such policies and procedures as regulation, provided the commissioner holds a public hearing prior to implementing the policies and procedures and prints notice of intent to adopt regulations on the department's Internet web site and the eRegulations System not later than twenty days after the date of implementation. Policies and procedures implemented pursuant to this section shall be valid until the time final regulations are adopted.

Sec. 2. Section 19a-681 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2018):

(a) For purposes of this section: (1) "Detailed patient bill" means a patient billing statement that includes, in each line item, the hospital's current pricemaster code, a description of the charge and the billed amount; and (2) "pricemaster" means a detailed schedule of hospital charges.

(b) Each hospital shall file with the office its current pricemaster which shall include each charge in its detailed schedule of charges.

(c) Upon the request of the Department of Public Health or a patient, a hospital shall provide to the department or the patient a detailed patient bill. If the billing detail by line item on a detailed patient bill does not agree with the detailed schedule of charges on file with the office for the date of service specified on the bill, the hospital shall be subject to a civil penalty of five hundred dollars per occurrence payable to the state not later than fourteen days after the date of notification. The penalty shall be imposed in accordance with section 19a-653, as amended by this act. The office may issue an order requiring such hospital, not later than fourteen days after the date of notification of an overcharge to a patient, to adjust the bill to be consistent with the detailed schedule of charges on file with the office for the date of service specified on the detailed patient bill.

(d) Each hospital shall post a copy of its current pricemaster on its Internet web site in an easily accessible location. The pricemaster shall be the version in effect at the time of posting. Every time a hospital files its pricemaster with the office, the hospital shall update the pricemaster posted on its Internet web site.

Sec. 3. Subsection (f) of section 19a-654 of the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):

(f) The Commissioner of Public Health [shall] may adopt regulations, in accordance with the provisions of chapter 54, to carry out the provisions of this section.

Sec. 4. Subdivision (5) of subsection (d) of section 19a-639 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2018):

(5) The office may place any conditions on the approval of a certificate of need application [involving a transfer of ownership of a hospital] consistent with the provisions of this chapter. Before placing any such conditions on an approval involving a transfer or ownership of a hospital, the office shall weigh the value of such conditions in promoting the purposes of this chapter against the individual and cumulative burden of such conditions on the transacting parties and the new hospital. For each condition imposed, the office shall include a concise statement of the legal and factual basis for such condition and the provision or provisions of this chapter that it is intended to promote. Each condition shall be reasonably tailored in time and scope. The transacting parties or the new hospital shall have the right to make a request to the office for an amendment to, or relief from, any condition based on changed circumstances, hardship or for other good cause.

Sec. 5. Subsection (e) of section 19a-639 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2018):

(e) (1) If the certificate of need application (A) involves the transfer of ownership of a hospital, (B) the purchaser is a hospital, as defined in section 19a-490, whether located within or outside the state, that had net patient revenue for fiscal year 2013 in an amount greater than one billion five hundred million dollars or a hospital system, as defined in section 19a-486i, as amended by this act, whether located within or outside the state, that had net patient revenue for fiscal year 2013 in an amount greater than one billion five hundred million dollars, or any person that is organized or operated for profit, and (C) such application is approved, the office shall hire an independent consultant to serve as a post-transfer compliance reporter for a period of three years after completion of the transfer of ownership of the hospital. The independent consultant shall have no previous financial interest with the hospital or hospital system, or any affiliate of the hospital or hospital system, no previous sanctions and no adverse decisions regarding monitoring activities. Such reporter shall, at a minimum: (i) Meet with representatives of the purchaser, the new hospital and members of the affected community served by the new hospital not less than quarterly; and (ii) report to the office not less than quarterly concerning (I) efforts the purchaser and representatives of the new hospital have taken to comply with any conditions the office placed on the approval of the certificate of need application and plans for future compliance, and (II) community benefits and uncompensated care provided by the new hospital. The purchaser shall give the reporter access to its records and facilities for the purposes of carrying out the reporter's duties. The purchaser shall hold a public hearing in the municipality in which the new hospital is located not less than annually during the reporting period to provide for public review and comment on the reporter's reports and findings.

(2) If the reporter finds that the purchaser has breached a condition of the approval of the certificate of need application, the office may [, in] take one of the following actions: (A) In consultation with the purchaser, the reporter and any other interested parties it deems appropriate, implement a performance improvement plan designed to remedy the conditions identified by the reporter and continue the reporting period for up to one year following a determination by the office that such conditions have been resolved; (B) institute an action to enjoin the purchaser from engaging in conduct in violation of the certificate of need; or (C) impose a civil penalty in accordance with section 19a-653, as amended by this act. In addition, for a breach of a condition specifying cost or price limits, the office may require a partial or full refund or repayment to the affected payer of the amount in excess of the conditioned limits.

(3) [The purchaser shall provide funds, in an amount determined by the office not to exceed two hundred thousand dollars annually, for the hiring of the post-transfer compliance reporter.] Upon the filing of a certificate of need application involving the transfer of ownership of a hospital, the purchaser shall establish an escrow account pursuant to a formal escrow agreement provided by the office for the purpose of paying the bills for services rendered by the independent consultant. The purchaser shall initially fund the escrow account with two hundred thousand dollars. The escrow agent shall pay such bills out of the escrow account directly to the independent consultant not later than thirty days after receipt of each bill by the purchaser.

Sec. 6. Subsection (j) of section 19a-639f of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2018):

(j) The office shall retain an independent consultant with expertise on the economic analysis of the health care market and health care costs and prices to conduct each cost and market impact review, as described in this section. [The office shall submit bills for such services to the purchaser, as defined in subsection (d) of section 19a-639. Such purchaser] Upon the filing of a certificate of need application involving the transfer of ownership of a hospital, the purchaser shall establish an escrow account pursuant to a formal escrow agreement provided by the Office of Health Care Access for the purpose of paying the bills for services rendered by the independent consultant. The purchaser shall initially fund the escrow account with two hundred thousand dollars. The office shall submit bills for independent consultant services to the purchaser, as defined in section 19a-630. The escrow agent shall pay such bills not later than thirty days after receipt. Such bills shall not exceed two hundred thousand dollars per application. The provisions of chapter 57, sections 4-212 to 4-219, inclusive, and section 4e-19 shall not apply to any agreement executed pursuant to this subsection.

Sec. 7. Subsection (a) of section 19a-653 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2018):

(a) [Any] The Department of Public Health may impose a civil penalty of up to one thousand dollars per day on any person or health care facility or institution that [is required] fails to (1) file a certificate of need for any of the activities described in section 19a-638, [and any person or health care facility or institution that is required to] for each day such activities are conducted without certificate of need approval, (2) file data or information under any public or special act or under this chapter or sections 19a-486 to 19a-486h, inclusive, or any regulation adopted or order issued under this chapter or said sections [, which wilfully fails to seek certificate of need approval for any of the activities described in section 19a-638 or to so file within prescribed time periods, shall be subject to a civil penalty of up to one thousand dollars a day for each day such person or health care facility or institution conducts any of the described activities without certificate of need approval as required by section 19a-638 or for each day such information is missing, incomplete or inaccurate] within the prescribed time periods, for each day such data or information is missing, incomplete or inaccurate, or (3) comply with a condition in accordance with subdivision (5) of subsection (d) of section 19a-639, as amended by this act, for each day such condition is breached. Any civil penalty authorized by this section shall be imposed by the Department of Public Health in accordance with subsections (b) to (e), inclusive, of this section.

Sec. 8. Subsection (a) of section 19a-486d of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2018):

(a) The commissioner shall deny an application filed pursuant to subsection (d) of section 19a-486a unless the commissioner finds that: (1) In a situation where the asset or operation to be transferred provides or has provided health care services to the uninsured or underinsured, the purchaser has made a commitment to provide health care to the uninsured and the underinsured; (2) in a situation where health care providers or insurers will be offered the opportunity to invest or own an interest in the purchaser or an entity related to the purchaser safeguard procedures are in place to avoid a conflict of interest in patient referral; and (3) certificate of need authorization is justified in accordance with chapter 368z. The commissioner may contract with any person, including, but not limited to, financial or actuarial experts or consultants, or legal experts with the approval of the Attorney General, to assist in reviewing the completed application. The commissioner shall submit any bills for such contracts to the purchaser. Such bills shall not exceed one hundred fifty thousand dollars. [The purchaser] Upon the filing of an application pursuant to subsection (d) of section 19a-486a, the purchaser shall establish an escrow account pursuant to a formal escrow agreement provided by the Office of Health Care Access for the purpose of paying bills for services rendered by the expert or consultant. The purchaser shall initially fund the escrow account with one hundred fifty thousand dollars. The escrow agent shall pay such bills [no] out of the escrow account directly to the expert or consultant not later than thirty days after the date of receipt of such bills.

Sec. 9. Subsections (g) to (i), inclusive, of section 19a-486i of the 2018 supplement to the general statutes are repealed and the following is substituted in lieu thereof (Effective from passage):

(g) Not later than January 15, [2018] 2019, and annually thereafter, each hospital and hospital system shall file with the Attorney General and the Commissioner of Public Health a written report describing the activities of the group practices owned or affiliated with such hospital or hospital system. Such report shall include, for each such group practice: (1) A description of the nature of the relationship between the hospital or hospital system and the group practice; (2) the names and specialties of each physician practicing medicine with the group practice; (3) the names of the business entities that provide services as part of the group practice and the address for each location where such services are provided; (4) a description of the services provided at each such location; and (5) the primary service area served by each such location.

(h) Not later than January 15, [2018] 2019, and annually thereafter, each group practice comprised of thirty or more physicians that is not the subject of a report filed under subsection (g) of this section shall file with the Attorney General and the Commissioner of Public Health a written report concerning the group practice. Such report shall include, for each such group practice: (1) The names and specialties of each physician practicing medicine with the group practice; (2) the names of the business entities that provide services as part of the group practice and the address for each location where such services are provided; (3) a description of the services provided at each such location; and (4) the primary service area served by each such location.

(i) Not later than January 15, [2018] 2019, and annually thereafter, each hospital and hospital system shall file with the Attorney General and the Commissioner of Public Health a written report describing each affiliation with another hospital or hospital system. Such report shall include: (1) The name and address of each party to the affiliation; (2) a description of the nature of the relationship among the parties to the affiliation; (3) the names of the business entities that provide services as part of the affiliation and the address for each location where such services are provided; (4) a description of the services provided at each such location; and (5) the primary service area served by each such location.

This act shall take effect as follows and shall amend the following sections:

Section 1

July 1, 2018

19a-639a

Sec. 2

July 1, 2018

19a-681

Sec. 3

from passage

19a-654(f)

Sec. 4

July 1, 2018

19a-639(d)(5)

Sec. 5

July 1, 2018

19a-639(e)

Sec. 6

July 1, 2018

19a-639f(j)

Sec. 7

July 1, 2018

19a-653(a)

Sec. 8

July 1, 2018

19a-486d(a)

Sec. 9

from passage

19a-486i(g) to (i)

Statement of Purpose:

To implement the recommendations of the Department of Public Health regarding revisions to the Office of Health Care Access statutes.

[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]