Bill Summaries: S506 (2021)

  • Summary date: Apr 6 2021 - View summary

    Part I.

    Revises defined terms applicable to certificates of need laws in Article 9, set forth in GS 131E-176, as follows. Changes the threshold criteria for diagnostic center to include a facility, program, or provider in which the total cost of all medical diagnostic equipment used by the facility which costs more than $10,000 or more exceeds $1.5 million (currently, the cost threshold is set at $500,000). Changes the threshold criteria for major medical equipment to include a unit or system used to provide medical or other health services which costs more than $2 million (currently, the threshold is $750,000). Changes the threshold criteria for new institutional health services to include the obligation of capital expenditures exceeding $4 million (was, $2 million) to develop or expand a health service or facility or relates to the provision of health services. Makes conforming changes to reflect the revised threshold amounts in GS 131E-184. Requires the cost threshold amount for diagnostic center, major medical equipment and new institutional health services to be adjusted annually, beginning September 30, 2022, as specified. Amends bed capacity to specify space used exclusively for inpatient care at a health care facility. Amends the definition of health service to exclude activities performed at a facility that does not meet the definition of a health service facility; removes ambulatory surgical facilities from the definition of health service facility. Removes the conversion of a specialty ambulatory surgical program to a multispecialty program or the addition of a specialty to an existing program from the term new institutional health services (the same provision is deleted again in Section 2(a) of this act, effective 19 months after the act becomes law). Makes conforming and technical changes.

    Amends GS 131E-184 by exempting from certificate of need review a new institutional health service if it receives prior written notice from the entity proposing the service for the development, acquisition, construction, expansion, or replacement of a health service facility or service that obtained certificate of need approval before October 1, 2019, as an ambulatory surgical facility. Also exempts a capital expenditure exceeding the $4 million (was, $2 million) threshold, when the specified conditions are met. Directs the Department of Health and Human Services (DHHS) to exempt from certificate of need review services or facilities for which a certificate of need has already been issued when those services or facilities are replaced, renovated, or relocated to another site in the same county where need was originally determined. Establishes an exemption from certificate of need review for the construction, development, acquisition, or establishment of an ambulatory surgical facility in a county with a population of 100,000 or more that meets four criteria, including requiring licensed physicians seeking the exemption to make every effort to enter into a joint venture with a licensed hospital as specified, agreement with a licensed hospital or hospital privileges to ensure inpatient hospital services are available as specified, capability to immediately transfer patients to an adequate emergency room, and compliance with statutory licensure requirements of ambulatory surgical facilities. 

    Enacts GS 131E-189(d), providing for the expiration of a certificate of need issued for the construction of a health service facility upon the certificate holder failing to initiate authorized construction within four years after the approval becomes final for projects costing over $50 million or two years after the approval becomes final for projects costing less than $50 million.

    Adds to the requirements for ambulatory surgical facility licensure under GS 131E-147 as follows. Requires all initial application and renewal applications to require statement of the number of procedure rooms on, and the number and type of procedures performed at, the named premises. Bars issuing or renewing a license to operate a facility developed, acquired, or replaced on or after October 1, 2019, unless the application provides (1) a commitment that the Medicare allowable amount for self-pay and Medicaid surgical cases minus all revenue collected from self-pay and Medicaid surgical cases will be the greater of either 4% of the total revenue collected for all surgical cases performed at the facility or the percentage of charity care ambulatory surgery services provided by the affiliated hospital; (2) a commitment to annually report the total number of self-pay, Medicaid, Medicare, commercial insurance, managed care, and other surgical cases to DHHS; and (3) a commitment to report use and payment data for services provided by the facility to the statewide data processor. 

    Effective January 1, 2022.

    Part II.

    Makes the following changes, effective 18 months after the act becomes law.

    Further amends GS 131E-176 to remove "psychiatric facility" and "chemical dependency treatment facility" from the term health care facility. Makes conforming changes to the term health service facility bed. Amends new institutional health services to provide for the new exemption enacted in GS 131E-184(j) for ambulatory surgical facilities that meet specified criteria.

    Amends GS 131E-184 regarding the certificate of need review exemption for any conversion of existing acute care beds to psychiatric beds, to eliminate two existing criteria that must be met to qualify for the exemption, including contracting with a division of DHHS and/or specified local authorities and not exceeding a specified limit for the number of beds converted. 

    Amends Section 12F.4 of SL 2016-94, which directs the DHHS Secretary to select hospitals from the three State regions to receive allocated funding for the construction, conversion, or both of short-term, inpatient behavior health beds in rural areas. Revises the conditions for funding to require selected rural hospitals to reserve at least 25%, rather than 50%, of the constructed or converted beds for purchase by DHHS under the State-administered three-way contract, and referrals by LME/MCOs of individuals who are indigent or Medicaid recipients. 

    Part III.

    Includes a severability clause.

    Part IV. 

    Makes the act effective on the date the act becomes law, unless otherwise provided. 

  • Summary date: Apr 5 2021 - View summary

    To be summarized.