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| Montana Administrative Register Notice 37-594 | No. 15 08/09/2012 | |
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BEFORE THE DEPARTMENT OF PUBLIC HEALTH AND HUMAN SERVICES OF THE STATE OF MONTANA
TO: All Concerned Persons 1. On August 29, 2012, at 1:30 p.m., the Department of Public Health and Human Services will hold a public hearing in Room 207 of the Department of Public Health and Human Services Building, 111 North Sanders, Helena, Montana, to consider the proposed adoption of the above-stated rules. 2. The Department of Public Health and Human Services will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice. If you require an accommodation, contact Department of Public Health and Human Services no later than 5:00 p.m. on August 22, 2012, to advise us of the nature of the accommodation that you need. Please contact Kenneth Mordan, Department of Public Health and Human Services, Office of Legal Affairs, P.O. Box 4210, Helena, Montana, 59604-4210; telephone (406) 444-4094; fax (406) 444-9744; or e-mail dphhslegal@mt.gov. 3. The rules as proposed to be adopted provide as follows: NEW RULE I PURPOSE (1) The purpose of these rules is to establish the general requirements for the licensure of specialty hospitals. These rules outline the process for application, including the submission of results of an impact study; and the development and implementation of charity care policies for the nondiscrimination of persons who are unable to pay for health care services provided in specialty hospitals. IMP: 50-5-121, 50-5-245, 50-5-246, MCA NEW RULE II SCOPE (1) A specialty hospital is a subclass of a hospital that is intended to diagnose, care, or treat patients with: (a) cardiac conditions; (b) orthopedic conditions; (c) patients undergoing surgery; or (d) patients being treated for cancer-related diseases and receiving oncology services. (2) A specialty hospital is subject to the general requirements applicable to all hospitals and must be licensed according to the rules as outlined in this subchapter. NEW RULE III DEFINITIONS (1) "Administrator" means the individual responsible for the day-to-day operations of a specialty hospital. This individual may also be known as, but not limited to, "chief executive officer," "executive director," or "president." (2) "Charity care" means provision of services to those who are unable to pay. This includes all of the under reimbursed costs of caring for low income patients who either are enrolled in a government program, such as Medicaid, or those who are uninsured, or underinsured. (3) "Emergency care services" means health care items and services furnished or required to evaluate and treat an emergency medical condition. (4) "Emergency medical condition" means a condition manifesting itself by symptoms of sufficient severity, including severe pain, that the absence of immediate medical attention could reasonably be expected to result in any of the following: (a) the person's health would be in serious jeopardy; (b) the person's bodily functions would be seriously impaired; or (c) a bodily organ or part would be seriously damaged. (5) "Impact study" means the examination and analysis of the financial and operational effects of a proposed specialty hospital on existing health care facilities in the service area. (6) "Independent consultant" means an individual or group of individuals who for a fee examine and analyze the financial and operational impacts of a proposed specialty hospital on existing health care facilities in the service area. In order to be deemed an independent consultant, the individual or group of individuals must not be an employee of, not otherwise related to, or affiliated with the owners or operators of a proposed specialty hospital or an existing health care facility in the service area. (7) "Joint venture relationship" means an express or implied agreement or contract between two or more parties to create the joint venture. (8) "Service area" means that geographic location in which local residents are the primary recipients of provided specialty hospital services. A nonresident is not prohibited from receiving services from the specialty hospital. (9) "Transfer of care" means relocating an individual to the care of another health care facility or health care provider when an adequate continuum of care is not possible. IMP: 50-5-101, 50-5-121, 50-5-245, 50-5-246, MCA NEW RULE IV GENERAL REQUIREMENTS (1) A specialty hospital must comply with the requirements under 42 CFR 482.2 through 482.62. The department adopts and incorporates by reference 42 CFR 482.2 through 482.62 as revised on May 16, 2012, which set forth the Centers for Medicare and Medicaid Services Conditions of Participation for Hospitals as the standard for the operation of specialty hospitals in Montana. A copy of 42 CFR 482.2 through 482.62 may be obtained from the Department of Public Health and Human Services, Quality Assurance Division, Licensure Bureau, NEW RULE V IMPACT STUDY (1) As indicated in [NEW RULE VI] a condition of application for a proposed specialty hospital is that it must conduct an impact study that analyzes the financial and operational impacts of the proposed specialty hospital on existing health care facilities in the service area. The impact study must be completed prior to submitting the application for licensure. (2) The applicant for a proposed specialty hospital: (a) must provide the department with an overview of the proposed specialty hospital including, but not limited to: (i) type of services to be provided in the proposed specialty hospital; (ii) the number and type of patients or residents for which care is to be provided; and (iii) the number of employees in all job classifications. (b) must provide to the department a list of independent consultants who could conduct the impact study; and (c) pay the costs of that study. (3) The department must provide for an opportunity for public comment and participation, including opportunity to comment on the list of consultants, into the study process. Prior to designating an independent consultant to conduct the impact study, the department will afford the public an opportunity to provide comment on the independent consultants and scope of the impact study. At the discretion of the department, a public meeting may be held in lieu of a formal hearing as an additional means of soliciting public comment. (4) The department will determine the scope of the impact study. After the department approves the consultant, the scope of the study will be finalized. The study will assess the potential positive and adverse impacts on access to the health care system in the applicant's service area. The scope of the study may include, but is not limited to: (a) the impact on health care costs in the service area; (b) the impacts on access to emergency care, mental health care, and other subsidized services provided in the proposed service area; (c) the operational impacts upon existing health care facilities; and (d) the need for the services proposed in the health service area. (5) The independent consultants utilized in these studies must: (a) have the necessary resources to conduct and complete the impact study within the required timeframes; (b) not allow the results of the study or the manner in which the study is conducted to be controlled by the proposed specialty hospital applicant or members of the joint venture; (c) address all areas designated within the scope of the study; and (d) prepare a written report documenting the findings of the impact study which the applicant will submit to the department with the license application. (6) The impact study must be completed within 180 days of the date the department finalizes the scope. (7) If as a result of the impact study, the department finds that a proposed specialty hospital will have an adverse influence on an existing hospital or to the community's health care delivery system, the department will: (a) impose conditions to mitigate the adverse effect; or (b) deny the request for license. NEW RULE VI LICENSE APPLICATION PROCESS (1) Application for a specialty hospital must be made on an application form provided by the department. At least 30 days prior to the opening of a facility, an applicant must submit to the department: (a) a completed license application form which must contain the following information: (i) the name and address of the applicant if an individual; the name and address of each member of a firm, partnership, or association; or the name and address of each officer if a corporation; (ii) the location of the proposed specialty hospital facility; (iii) the name of the person or persons who will administer, manage, or supervise the specialty hospital facility; (iv) the number and type of patients or residents for which care is to be provided; (v) the number of employees in all job classifications; (vi) a copy of the contract, lease agreement, or other document indicating the person legally responsible for the operation of the specialty hospital facility if the specialty hospital is operated by a person other than the owner; (vii) the designated name of the specialty hospital to be licensed; and (viii) the owner or operator of a health care facility must sign the completed license application form. (b) the results of an impact study showing the analysis of the financial and operational impacts of the proposed specialty hospital on existing health care facilities in the area; (c) each application form must be accompanied by the applicable license fee: (i) $20.00 license fee for a specialty hospital with 20 beds or less; (ii) $1.00 per bed license fee for a specialty hospital with 21 beds or more. (2) The department will renew the license for a period of one to three years if the specialty hospital: (a) makes written application for renewal on an application form provided by the department at least 30 days prior to the expiration date of its current license; (b) meets the minimum licensure standards; and (c) employs or contracts with existing or proposed qualified staff adequate to operate the facility. (3) On receipt of a new or renewal license application, the department or its authorized agent will inspect the specialty hospital to determine if the proposed staff is qualified and the facility meets the minimum standards set forth in this subchapter. If minimum standards are met and the proposed staff is qualified, the department will issue a license for a period of one to three years. (a) The department may issue a provisional license for a period of less than one year if continued operation of the specialty hospital will not result in undue hazard to patients or if demand for the accommodations offered is not met in the community. (4) A patient may not be admitted or cared for in a specialty hospital unless the facility is licensed. (5) Licensed premises must be open to inspection by the department or its authorized agent and access to all records must be granted to the department at all reasonable times. (6) The designated name of the specialty hospital may not be changed without first notifying the department in writing. IMP: 50-5-111, 50-5-201, 50-5-202, 50-5-203, 50-5-204, 50-5-207, 50-5-245, 50-5-246, MCA NEW RULE VII FACILITY TRANSFER OF CARE AGREEMENT (1) Prior to accepting patients, a specialty hospital must have in place a signed transfer care agreement with a hospital capable of providing emergency care services. A specialty hospital must also have written policies that result in medically appropriate transfers. (2) Prior to transferring a patient from a specialty hospital, the specialty hospital must: (a) notify the receiving hospital before the patient is transferred and receive confirmation from the receiving hospital that services necessary to treat the patient are available; (b) use medically appropriate life support measures to stabilize the patient before the transfer and to sustain the patient during the transfer; (c) transfer all necessary records for continuing the care for the patient; and (d) in cases of nonemergent care services ensure that the patient or legally responsible person acting on the patient's behalf are informed of the risk and benefit of transfer. NEW RULE VIII ADMINISTRATOR (1) Each specialty hospital must have an administrator who: (a) maintains daily overall responsibility for the facility operations; (b) develops and oversees the implementation of all policies and procedures pertaining to the operation of the specialty hospital; (c) establishes written policies and procedures for all facility human resource services; (d) establishes a process for patient complaints and grievances; (e) establishes a patient incident report file on all patient incidents or allegation of abuse; (f) develops and maintains an organizational chart that delineates the current lines of authority, responsibility, and accountability for the administration and provision of all facility patient treatment programs and services; and (g) develops and implements written orientation and training procedures on all facility policies and procedures for all employees or contractors, relief workers, temporary employees, students, interns, volunteers, and trainees to include, but not limited to: (i) defining responsibilities, limitations, and supervision of students, interns, and volunteers working for the specialty hospital; and (ii) verifying each professional staff member's credentials, when hired, and annually thereafter, to ensure the continued credentialing of required licenses. (2) The administrator must develop policies and procedures for screening, hiring, and assessing staff which include practices that assist the employer in identifying employees that may pose a risk or threat to the health, safety, or welfare of any resident and provide written documentation of findings and the outcome in the employees file. (3) In the absence of the administrator, a staff member must be designated to oversee the operation of the facility during the administrator's absence. The administrator or designee must be in charge, on call, and physically available on a daily basis as needed, and must ensure there are sufficient, qualified staff so that the care, health, safety, and welfare needs of the patient are met at all times. (4) If the administrator is absent for more than 30 calendar days, the department must be given written notice of the individual who has been appointed as the designee. IMP: 50-5-103, MCA NEW RULE IX CHARITY CARE POLICY (1) Every specialty hospital must have a charity care policy that is actively implemented. The charity care policy should reflect the organization's mission statement, organizational goals and objectives, and legal and resource constraints. (2) A specialty hospital devising a charity care policy should clearly identify the difference between charity care and bad debt. (3) For any specialty hospital that has a For Profit tax status, the facility's charity care policy must be commensurate to the policies which exist for any nonprofit hospital in the community. (4) In addition to (1), the charity care policy criteria should include a mixture of the following factors: (a) individual or family income or net worth; (b) employment status and earning capacity; (c) family size; (d) other financial obligations; (e) other sources of payment for the services rendered; (f) type of services provided, whether elective or emergency; (g) costs to provide services exceeds third-party payments for services; and (h) in the case of emergency department visits only, failure of the patient to cooperate with billing inquiries when the patient lives in a zip code known to have a per capita income below the federal poverty level.
NEW RULE X JOINT VENTURE RELATIONSHIP REQUIREMENTS (1) Each specialty hospital must have a joint venture relationship with a hospital or a signed statement from a nonprofit hospital in the community acknowledging that the hospital declined a bona fide, good faith opportunity to participate in a joint venture with the specialty hospital applicant. (2) To qualify as a joint venture, the agreements must contain the following four elements: (a) an express or implied agreement or contract creating and defining the joint venture; (b) a common purpose among the parties; (c) community of interest; and (d) equal right to control of the venture. IMP: 50-5-245, MCA
NEW RULE XI LICENSE DENIAL (1) The department may deny an application for a specialty hospital as a result of an adverse impact study or for any reason as outlined in 50-5-207, MCA. (2) If an application for a specialty hospital is denied for any reason, the department will issue a written denial of the license, the grounds for denial, and the right to an appeal pursuant to 50-5-208, MCA. (3) A decision to deny an application or to impose conditions upon an applicant or licensee may be appealed by filing a request for a hearing, in writing, to the department's Office of Fair Hearings. (4) Hearing requests must be received by the Office of Fair Hearings at P.O. Box 202953, 2401 Colonial Drive, Third Floor, Helena, MT 59620-2953, within 30 days after the date of mailing of notice of the department's decision. IMP: 50-5-207, 50-5-208, 50-5-245, 50-5-246, MCA 4. STATEMENT OF REASONABLE NECESSITY The department is proposing the adoption New Rules I through XI pertaining to minimum licensing standards for specialty hospitals. Senate Bill 446 passed by the 2009 Legislature, (Ch. 456, L. 2009) revised hospital laws to provide licensing requirements for specialty hospitals. The proposed rules address the provisions of the legislation by addressing the scope and purpose of the rules, the general requirements for a specialty hospital, the required impact study requirements, license application and denial requirements, transfer of care agreements, charity care policy, and joint venture requirements. Section 50-5-245, MCA, requires the department to adopt rules governing the qualifications for licensure of specialty hospitals. These proposed licensure rules provide the minimum licensing standards for specialty hospitals specifically while coordinating with the provisions of Title 50, chapter 5, parts 1 and 2, MCA. In addition to being required by statute, the rules are necessary to inform potential specialty hospital applicants of the expectations necessary in order to be licensed. The department considered several approaches to licensing specialty hospitals including modifying existing minimum standards for hospital rules. This option was rejected because of the statutory requirements specific to specialty hospitals are not applicable to other hospitals. The department determined that combining the requirements would cause confusion between hospital types and therefore is proposing new rules specific to specialty hospitals. New Rule I This rule is necessary to provide an overview of the requirements for licensure of specialty hospitals. New Rule II This rule is necessary to identify the scope of specialty hospitals and to indicate that specialty hospitals need to comply with the general licensing requirements in addition to those licensing requirements specific to specialty hospitals. Requiring specialty hospitals to comply with these licensing requirements ensures the hospital meets the minimum standards in providing care and a safe environment for the hospital's patients, staff, and visitors. New Rule III This rule is necessary to define the terms used in the rules that are not defined in statute. This ensures that all involved are exposed to the meaning of the terms used thereby creating a clearer understanding of the intent of the rules. New Rule IV This rule is necessary to indicate that specialty hospitals comply with the Centers for Medicare and Medicaid Services Conditions of Participation for Hospitals as the standard for the operation of specialty hospitals. These conditions are necessary in the interest of the health and safety of the individuals who are furnished services in hospitals. By requiring compliance with these conditions, there is no variation between the general requirements of hospitals and specialty hospitals. New Rule V This rule is necessary to identify the process and information that is required for the department to make an informed decision regarding the impact a specialty hospital will have on an existing hospital or the community's health care delivery system. Without the impact study, the department has no knowledge of the feasibility of an area supporting multiple facilities and what multiple facilities will do to the provision of services in an area. New Rule VI This rule is necessary to identify the process for licensing a specialty hospital. An entity seeking licensure must know the expectations required in order to apply for and maintain a specialty hospital license. New Rule VII This rule is necessary to indicate that the specialty hospital has made arrangements to provide emergency care services in the event that the patient is not able to receive the necessary care at the specialty hospital. Without the transfer of care agreement in place, the patient's level of care may be negatively impacted. New Rule VIII This rule is necessary to ensure that there is a clear designation of authority regarding the administration of the specialty hospital. By providing this designation, the operation of the specialty hospital is overseen by an individual who is responsible for ensuring that the requirements necessary to ensure the safe operation of the facility are met and maintained. New Rule IX This rule is necessary to ensure that specialty hospitals actively implement a charity care policy comparable to other nonprofit hospitals in the area. If the specialty hospital is not required to operate using the same level of charity care, the existing facilities in the area may be at an economic disadvantage and the facilities may not be able to provide similar levels of care to their patients. New Rule X This rule is necessary to indicate that the existing hospital in the community was afforded the opportunity to participate in the establishment of the specialty hospital. By providing the joint venture relationship requirement, the existing facility may opt in or out of being involved in the operation of another facility that may be providing similar services, thereby providing the potential for financial and operational competition. New Rule XI This rule is necessary to indicate that not all specialty hospital applicants will be eligible for licensure by the department. This rule identifies for the applicant the possible reasons for licensure denial and the appeal process. The possible reasons for denying licensure must be identified so applicants are made aware that a license is not guaranteed. If an applicant is not licensed, the department must provide the opportunity to appeal the decision in order to not violate the applicant's rights. Fiscal Impact There is no fiscal impact due to this rulemaking. 5. Concerned persons may submit their data, views, or arguments either orally or in writing at the hearing. Written data, views, or arguments may also be submitted to: Kenneth Mordan, Department of Public Health and Human Services, Office of Legal Affairs, P.O. Box 4210, Helena, Montana, 59604-4210; fax (406) 444-9744; or e-mail dphhslegal@mt.gov, and must be received no later than 5:00 p.m., September 6, 2012. 6. The Office of Legal Affairs, Department of Public Health and Human Services, has been designated to preside over and conduct this hearing. 7. The department maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list must make a written request that includes the name, e-mail, and mailing address of the person to receive notices and specifies for which program the person wishes to receive notices. Notices will be sent by e-mail unless a mailing preference is noted in the request. Such written request may be mailed or delivered to the contact person in 5 above or may be made by completing a request form at any rules hearing held by the department. 8. An electronic copy of this proposal notice is available through the Secretary of State's web site at http://sos.mt.gov/ARM/Register. The Secretary of State strives to make the electronic copy of the notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that in the event of a discrepancy between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered. In addition, although the Secretary of State works to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems. 9. The bill sponsor contact requirements of 2-4-302, MCA, apply and have been fulfilled. The primary bill sponsor was contacted by mail on July 20, 2012. /s/ Kurt R. Moser /s/ Anna Whiting Sorrell Rule Reviewer Anna Whiting Sorrell, Director Public Health and Human Services Certified to the Secretary of State July 30, 2012.
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