ENGROSSED
Senate Bill No. 550
(By Senators Helmick and Ross)
____________
[Introduced February 16, 1999; referred to the Committee on
Health and Human Resources; and then to the Committee on
Finance.]
____________
A BILL to amend and reenact section five, article two-d, chapter
sixteen of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, relating to the conversion
of rural hospital acute care and psychiatric beds to skilled
nursing beds certified by medicare and medicaid; and
providing an exception to agency rules and certain statutory
requirements.
Be it enacted by the Legislature of West Virginia:
That section five, article two-d, chapter sixteen of the
code of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted to read as follows:
ARTICLE 2D. CERTIFICATE OF NEED.
§16-2D-5. Powers and duties of state agency.
(a) The state agency shall administer the certificate of
need program as provided by this article.
(b) The state agency is responsible for coordinating and
developing the health planning research efforts of the state and
for amending and modifying the state health plan which includes
the certificate of need standards.
(c) The state agency may seek advice and assistance of other
persons, organizations and other state agencies in the
performance of the state agency's responsibilities under this
article.
(d) For health services for which competition appropriately
allocates supply consistent with the state health plan, the state
agency shall, in the performance of its functions under this
article, give priority, where appropriate to advance the purposes
of quality assurance, cost effectiveness and access, to actions
which would strengthen the effect of competition on the supply of
the services.
(e) For health services for which competition does not or
will not appropriately allocate supply consistent with the state
health plan, the state agency shall, in the exercise of its
functions under this article, take actions, where appropriate to
advance the purposes of quality assurance, cost effectiveness and
access and the other purposes of this article, to allocate the
supply of the services.
(f) Notwithstanding the provisions of section seven of this
article, the state agency may charge a fee for the filing of any
application, the filing of any notice in lieu of an application,
the filing of any exemption determination request or the filing
of any request for a declaratory ruling. The fees charged may
vary according to the type of matter involved, the type of health
service or facility involved or the amount of capital expenditure
involved. The state agency shall implement this subsection by
filing procedural rules pursuant to chapter twenty-nine-a of this
code. The fees charged shall be deposited into a special fund
known as the certificate of need program fund to be expended for
the purposes of this article.
(g) No hospital, nursing home or other health care facility
shall add any intermediate care or skilled nursing beds to its
current licensed bed complement. This prohibition also applies
to the conversion of acute care or other types of beds to
intermediate care or skilled nursing beds: Provided, That
hospitals eligible under the provisions of section four-a and
subsection (i), section five of this article may convert acute
care beds to skilled nursing beds in accordance with the
provisions of these sections, upon approval by the state agency.
Furthermore, no certificate of need shall be granted for the
construction or addition of any intermediate care or skilled
nursing beds except in the case of facilities designed to replace existing beds in unsafe existing facilities. A health care
facility in receipt of a certificate of need for the construction
or addition of intermediate care or skilled nursing beds which
was approved prior to the effective date of this section shall
incur an obligation for a capital expenditure within twelve
months of the date of issuance of the certificate of need. No
extensions shall be granted beyond the twelve-month period.
(h) No additional intermediate care facility for the
mentally retarded (ICF/MR) beds shall be granted a certificate of
need, except that prohibition does not apply to ICF/MR beds
approved under the Kanawha County circuit court order of the
third day of August, one thousand nine hundred eighty-nine, civil
action number MISC-81-585 issued in the case of E. H. v. Matin,
168 W.V. 248, 284 S.E.2d 232 (1981).
(i) Notwithstanding the provisions of subsection (g),
section five of this article and, further notwithstanding the
provisions of subsection (b), section three of this article, an
existing acute care hospital may apply to the health care
authority for a certificate of need to convert acute care beds to
skilled nursing beds: Provided, That the proposed skilled
nursing beds are medicare certified-only: Provided, however,
That any hospital which converts acute care beds to medicare
certified-only skilled nursing beds shall not bill for any
medicaid reimbursement for any converted beds. In converting beds, the hospital shall convert a minimum of one acute care bed
into one medicare certified-only skilled nursing bed. The health
care authority may require a hospital to convert up to and
including three acute care beds for each medicare certified-only
skilled nursing bed: Provided further, That a hospital
designated or provisionally designated by the state agency as a
rural primary care hospital may convert up to thirty beds to a
distinct-part nursing facility, including skilled nursing beds
and intermediate care beds, on a one-for-one basis if the rural
primary care hospital is located in a county without a certified
free-standing nursing facility and the hospital may bill for
medicaid reimbursement for the converted beds: And provided
further, That if the hospital rejects the designation as a rural
primary care hospital then the hospital may not bill for medicaid
reimbursement. The health care authority shall adopt rules to
implement this subsection which require that:
(1) All acute care beds converted shall be permanently
deleted from the hospital's acute care bed complement and the
hospital may not thereafter add, by conversion or otherwise,
acute care beds to its bed complement without satisfying the
requirements of subsection (b), section three of this article for
which purposes an addition, whether by conversion or otherwise,
shall be considered a substantial change to the bed capacity of
the hospital notwithstanding the definition of that term found in subsection (ff), section two of this article.
(2) The hospital shall meet all federal and state licensing
certification and operational requirements applicable to nursing
homes including a requirement that all skilled care beds created
under this subsection shall be located in distinct-part, long- term care units.
(3) The hospital shall demonstrate a need for the project.
(4) The hospital shall use existing space for the medicare
certified-only skilled nursing beds. Under no circumstances
shall the hospital construct, lease or acquire additional space
for purposes of this section.
(5) The hospital shall notify the acute care patient, prior
to discharge, of facilities with skilled nursing beds which are
located in or near the patient's county of residence.
Nothing in this subsection negatively affects the rights of
inspection and certification which are otherwise required by
federal law or regulations or by this code or duly adopted rules
of an authorized state entity.
(j) (1) Notwithstanding the provisions of subsection (g) of
this section, a retirement life-care center with no skilled
nursing beds may apply to the health care authority for a
certificate of need for up to sixty skilled nursing beds provided
the proposed skilled beds are medicare certified only. On a
statewide basis, a maximum of one hundred eighty skilled beds which are medicare certified only may be developed pursuant to
this subsection. The state health plan is not applicable to
projects submitted under this subsection. The health care
authority shall adopt rules to implement this subsection which
shall include a requirement that:
(A) The one hundred eighty beds are to be distributed on a
statewide basis;
(B) There be a minimum of twenty beds and a maximum of sixty
beds in each approved unit;
(C) The unit developed by the retirement life-care center
meet all federal and state licensing certification and
operational requirements applicable to nursing homes;
(D) The retirement center demonstrate a need for the
project;
(E) The retirement center offer personal care, home health
services and other lower levels of care to its residents; and
(F) The retirement center demonstrate both short and long- term financial feasibility.
(2) Nothing in this subsection negatively affects the rights
of inspection and certification which are otherwise required by
federal law or regulations or by this code or duly adopted rules
of an authorized state entity.
(k) The state agency may order a moratorium upon the
processing of an application or applications for the development of a new institutional health service filed pursuant to section
three of this article, when criteria and guidelines for
evaluating the need for the new institutional health service have
not yet been adopted or are obsolete. The moratorium shall be
declared by a written order which shall detail the circumstances
requiring the moratorium. Upon the adoption of criteria for
evaluating the need for the new institutional health service
affected by the moratorium, or one hundred eighty days from the
declaration of a moratorium, whichever is less, the moratorium
shall be declared to be over and affected applications shall be
processed pursuant to section six of this article.
(l) (1) The state agency shall coordinate the collection of
information needed to allow the state agency to develop
recommended modifications to certificate of need standards as
required in this article. When the state agency proposes
amendments or modifications to the certificate of need standards,
it shall file with the secretary of state, for publication in the
state register, a notice of proposed action, including the text
of all proposed amendments and modifications, and a date, time
and place for receipt of general public comment. To comply with
the public comment requirement of this section, the state agency
may hold a public hearing or schedule a public comment period for
the receipt of written statements or documents.
(2) All proposed amendments and modifications to the certificate of need standards, with a record of the public
hearing or written statements and documents received pursuant to
a public comment period, shall be presented to the governor.
Within thirty days of receiving the proposed amendments or
modifications, the governor shall either approve or disapprove
all or part of the amendments and modifications, and, for any
portion of amendments or modifications not approved, shall
specify the reason or reasons for nonapproval. Any portions of
the amendments or modifications not approved by the governor may
be revised and resubmitted.
(m) The state agency may exempt from or expedite rate
review, certificate of need, and annual assessment requirements
and issue grants and loans to financially vulnerable health care
facilities located in underserved areas that the state agency and
the office of community and rural health services determine are
collaborating with other providers in the service area to provide
cost effective health care services.
(n) Notwithstanding any provision contained in this article
or section and any rule issued by the state agency, including
compliance with certificate of need requirements, any rural
hospital with less than eighty licensed acute care beds as of the
first day of January, one thousand nine hundred ninety-eight, may
convert up to forty-four percent of existing licensed acute care
beds to skilled nursing beds for certification by both medicare and medicaid for reimbursement purposes provided that the
following conditions are met:
(1) There is no overall increase in the bed capacity of the
hospital; one acute care bed is converted to one dually certified
medicare and medicaid skilled nursing bed.
(2) All converted acute care beds shall be permanently
deleted from the acute care bed complement of the hospital, which
may not thereafter add, by conversion or otherwise, acute care
beds to its bed complement without satisfying the requirements of
subdivision (4), subsection (b), section three of this article,
for which purposes the addition, whether by conversion or
otherwise, shall be considered a substantial change to the bed
capacity of the hospital notwithstanding the definition of that
term as found in subsection (e), section two of this article.
(3) Prior to the conversion, the occupancy rate for licensed
acute care beds cannot exceed forty percent for twenty-four
consecutive months prior to the first month in which this section
is effective.
(4) The hospital shall meet all federal and state licensing
requirements for the provision of skilled nursing services.
Additionally, all skilled nursing beds created under this
exemption shall be located in distinct long-term care units in a
previously constructed part of the hospital that can be used for
that purpose.
(5) The hospital is located in a nonmetropolitan statistical
area as defined by the bureau of the census of the federal
government and is located in the same city in which a hospital
providing mental health inpatient services owned and operated by
the state of West Virginia ceased offering the inpatient services
not later than one thousand nine hundred ninety.
(6) Nothing in this section negatively affects the rights of
inspection and certification which are elsewhere required by
federal law or regulations.
(o) Notwithstanding any provision of law to the contrary,
beginning the first day of January, two thousand, any rural
hospital with less than sixty licensed acute care beds and more
than twenty psychiatric care beds may convert up to eight percent
of existing licensed acute care beds and sixty percent of
existing licensed acute care beds and sixty percent of existing
licensed psychiatric care beds to skilled nursing beds for
certification by both medicare and medicaid for reimbursement
purposes provided that the following requirements are met:
(1) There is no overall increase in the bed capacity of the
hospital and one acute care or psychiatric care bed is converted
to one certified medicare and medicaid skilled nursing bed;
(2) All converted acute care and psychiatric care beds are
permanently deleted from the acute care or psychiatric care bed
complement of the hospital, which may not thereafter add, by conversion or otherwise, acute care or psychiatric care beds to
its bed complement without satisfying the requirements of
subdivision (4), subsection (b), section three of this article.
Notwithstanding any provision of law to the contrary, the
permanent deletion shall be considered a substantial change to
the bed capacity of the hospital.
(3) Prior to the conversion, the occupancy rate for licensed
acute care beds or licensed psychiatric care beds may not exceed
fifty percent for twenty-four consecutive months prior to the
first month in which this section becomes effective.
(4) The hospital meets all federal and state licensing
requirements for the provision of skilled nursing services and,
all skilled nursing beds created under this exemption are located
in distinct long-term care units in a previously constructed part
of the hospital that is amenable to use for that purpose.
(5) The hospital is located in a nonmetropolitan statistical
area defined by the bureau of the census of the federal
government and is located within thirty miles of a hospital
providing mental health inpatient services owned and operated by
the state.
(p) Notwithstanding any provision of law to the contrary,
beginning the first day of January, one thousand nine hundred
ninety-nine, any rural hospital that was previously a for-profit
organization and which has been certified as a not-for-profit organization within the two years prior to the first month in
which this section becomes effective, may convert up to twenty- five licensed acute care beds to skilled nursing beds for
certification by both medicare and medicaid for reimbursement
purposes, provided that the following conditions are met:
(1) There is no overall increase in the bed capacity of the
hospital; one acute care bed is converted to one dually certified
medicare and medicaid skilled nursing bed.
(2) All converted acute care beds shall be permanently
deleted from the acute care bed compliment of the hospital,
which may not thereafter add, by conversion or otherwise, acute
care beds to its bed compliment without satisfying the
requirements of subdivision (4), subsection (b), section three of
this article, for which purposes the addition, whether by
conversion or otherwise, shall be considered a substantial change
to the bed capacity of the hospital notwithstanding the
definition of that term as found in subsection (e), section two
of this article.
(3) The hospital shall meet all federal and state licensing
requirements for the provisions of skilled nursing services.
Additionally, all skilled nursing beds created under this
exemption shall be located in distinct long-term care units in a
previously constructed part of the hospital that can be used for
that purpose.
(4) Nothing in this section negatively affects the rights of
inspection and certification which are elsewhere required by
federal law or regulations.;
(q) Nothing in this section may be construed to inhibit or
constrain the requirement of inspection and certification
required by federal law.