Alabama 2025 Regular Session

Alabama Senate Bill SB285 Compare Versions

Only one version of the bill is available at this time.

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1	1	SB285INTRODUCED
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3	3	SB285
4	4	UA2CDXG-1
5	5	By Senator Stutts
6	6	RFD: Fiscal Responsibility and Economic Development
7	7	First Read: 01-Apr-25
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12	12	5 UA2CDXG-1 03/19/2025 JC (L)lg 2025-660
13	13	Page 1
14	14	First Read: 01-Apr-25
15	15	SYNOPSIS:
16	16	Under existing law, health care institutions and
17	17	providers must apply for and obtain a certificate of
18	18	need as a requirement for constructing new medical
19	19	facilities or offering new or expanded health care
20	20	services.
21	21	This bill would eliminate the certificate of
22	22	need requirement for any proposed new or expanded
23	23	facility or health care service that provides obstetric
24	24	care or psychiatric treatment.
25	25	This bill would also delete duplicative language
26	26	and also make nonsubstantive, technical revisions to
27	27	update the existing code language to current style.
28	28	A BILL
29	29	TO BE ENTITLED
30	30	AN ACT
31	31	Relating to the certificate of need program; to amend
32	32	Section 22-21-265, Code of Alabama 1975, to exclude new or
33	33	expanded health care facilities that provide obstetric or
34	34	psychiatric care from the certificate of need requirement; to
35	35	amend Sections 22-21-260, 22-21-263, and 22-21-264, Code of
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63	63	28 SB285 INTRODUCED
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65	65	amend Sections 22-21-260, 22-21-263, and 22-21-264, Code of
66	66	Alabama 1975, to make conforming changes; and to delete
67	67	duplicative language and make nonsubstantive, technical
68	68	revisions to update the existing code language to current
69	69	style.
70	70	BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
71	71	Section 1. Sections 22-21-260, 22-21-263, 22-21-264,
72	72	and 22-21-265, Code of Alabama 1975, are amended to read as
73	73	follows:
74	74	"§22-21-260
75	75	As used in this article, the following words and terms,
76	76	and the plurals thereof, shall have the meanings ascribed to
77	77	them in this section, unless otherwise required by their
78	78	respective context:
79	79	(1) ACQUISITION. Obtaining the legal equitable title to
80	80	a freehold or leasehold estate or otherwise obtaining the
81	81	substantial benefit of such titles or estates, whether by
82	82	purchase, lease, loan or suffrage, gift, devise, legacy,
83	83	settlement of a trust or means whatever, and shall include any
84	84	act of acquisition. The term "acquisition" shall does not mean
85	85	or include:
86	86	a. Anyany conveyance, or creation of any lien or
87	87	security interest by mortgage, deed of trust, security
88	88	agreement, or similar financing instrument , nor shall it mean
89	89	or include any;
90	90	b. Any transfer of title or rights as a result of the
91	91	foreclosure, or conveyance or transfer in lieu of the
92	92	foreclosure, of any such mortgage, deed of trust, security
93	93	agreement, or similar financing instrument , nor shall it mean
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123	123	agreement, or similar financing instrument , nor shall it mean
124	124	or include any; or
125	125	c. Any gift, devise, legacy, settlement of trust, or
126	126	other transfer of the legal or equitable title of an interest
127	127	specified hereinabove by a natural person an individual to any
128	128	member of such person'sthe individual's immediate family. For
129	129	the purposes of this sectionparagraph, "immediate family"
130	130	shall meanmeans the spouse of the grantor or transferor and
131	131	any other person related to the grantor or transferor to the
132	132	fourth degree of kindred as such degrees are computed
133	133	according to law.
134	134	(2) APPLICANT. Any person, as defined in this section,
135	135	who files an application for a certificate of need.
136	136	(2.1)(3) CAMPUS. The contiguous real property,
137	137	contained within a single county, which is owned or leased by
138	138	a health care facility and upon which is located the buildings
139	139	and any other real property used by the health care facility
140	140	to provide existing institutional health services which are
141	141	subject to review.
142	142	(3)(4) CAPITAL EXPENDITURE. An expenditure, including a
143	143	force account expenditure (i.e., an expenditure for a
144	144	construction project undertaken by the health care facility as
145	145	its own contractor), which, under generally accepted
146	146	accounting principles, is not properly chargeable as an
147	147	expense of operation and maintenance and which satisfies any
148	148	of the following:
149	149	a. Exceeds two million dollars ($2,000,000) indexed
150	150	annually for inflation for major medical equipment; eight
151	151	hundred thousand dollars ($800,000) for new annual operating
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181	181	hundred thousand dollars ($800,000) for new annual operating
182	182	costs indexed annually for inflation; four million dollars
183	183	($4,000,000) indexed annually for inflation for any other
184	184	capital expenditure. The index referenced in this paragraph
185	185	shall be the Consumer Price Index Market Basket Professional
186	186	Medical Services index as published by the U.S. Department of
187	187	Labor, Bureau of Labor Statistics. The SHPDA shall publish
188	188	this index information to the general public.
189	189	b. Changes the bed capacity of the facility with
190	190	respect to which such expenditure is made.
191	191	c. Substantially changes the health services of the
192	192	facility with respect to which such expenditure is made.
193	193	(4)(5) CONSTRUCTION. Actual commencement, with bona
194	194	fide intention of completing the construction, or completion
195	195	of the construction, erection, remodeling, relocation,
196	196	excavation, or fabrication of any real property constituting a
197	197	facility under this article, and the term construct shall mean
198	198	and include means and includes any act of construction.
199	199	"Ground breaking ceremony," "receipt of bids," "receipt of
200	200	quotation," or similar action that will permit unilateral
201	201	termination without penalty shall not be considered
202	202	construction.
203	203	(5)(6) FIRM COMMITMENT or OBLIGATION. Any of the
204	204	following:
205	205	a. Any executed, enforceable, unconditional , written
206	206	agreement or contract not subject to unilateral cancellation
207	207	for the acquisition or construction of a health care facility
208	208	or purchase of equipment therefor.
209	209	b. Actual construction of facilities peculiarly adapted
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239	239	b. Actual construction of facilities peculiarly adapted
240	240	to the furnishing of one or more particular services and with
241	241	the bona fide intention of furnishing such service or
242	242	services.
243	243	c. Any executed, unconditional , written agreement not
244	244	subject to unilateral cancellation for the bona fide purpose
245	245	of furnishing one or more services.
246	246	(6)(7) HEALTH CARE FACILITY. General and specialized
247	247	hospitals, including tuberculosis, psychiatric, long-term
248	248	care, and other types of hospitals, and related facilities
249	249	such as, laboratories, out-patient clinics, and central
250	250	service facilities operated in connection with hospitals;
251	251	skilled nursing facilities; intermediate care facilities;
252	252	skilled or intermediate care units operated in veterans'
253	253	nursing homes and veterans' homes, owned or operated by the
254	254	State Department of Veterans' Affairs, as these terms are
255	255	described in Chapter 5A (commencing with Section 31-5A-1) of
256	256	Title 31, rehabilitation centers; public health centers;
257	257	facilities for surgical treatment of patients not requiring
258	258	hospitalization; kidney disease treatment centers, including
259	259	free-standing hemodialysis units; community mental health
260	260	centers and related facilities; alcohol and drug abuse
261	261	facilities; facilities for the developmentally disabled;
262	262	hospice service providers; and home health agencies and health
263	263	maintenance organizations. The term health care facility
264	264	shalldoes not include the offices of private physicians or
265	265	dentists, whether for individual or group practices and
266	266	regardless of ownership, or Christian Science sanatoriums
267	267	operated or listed and certified by the First Church of
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297	297	operated or listed and certified by the First Church of
298	298	Christ, Scientist, Boston, Massachusetts, or a veterans'
299	299	nursing home or veterans' home owned or operated by the State
300	300	Department of Veterans'Veterans Affairs, not to exceed 150
301	301	beds to be built in Bay Minette, Alabama, and a veterans'
302	302	nursing home or veterans' home owned or operated by the State
303	303	Department of Veterans'Veterans Affairs not to exceed 150 beds
304	304	to be built in Huntsville, Alabama, for which applications for
305	305	federal funds under federal law are being considered by the
306	306	U.S. Department of Veterans'Veterans Affairs prior to March
307	307	18, 1993.
308	308	(7)(8) HEALTH SERVICE AREA. A geographical area
309	309	designated by the Governor, as being appropriate for effective
310	310	planning and development of health services.
311	311	(8)(9) HEALTH SERVICES. Clinically related (i.e.,
312	312	diagnostic, curative, or rehabilitative) services, including
313	313	alcohol,and drug abuse, and mental health services
314	314	customarily furnished on either an in-patient or out-patient
315	315	basis by health care facilities, but not including the lawful
316	316	practice of any profession or vocation conducted independently
317	317	of a health care facility and in accordance with applicable
318	318	licensing laws of this state.
319	319	(9)(10) INSTITUTIONAL HEALTH SERVICES. Health services
320	320	provided in or through health care facilities or health
321	321	maintenance organizations, including the entities in or
322	322	through which such services are provided.
323	323	(9.1)(11) MAJOR MEDICAL EQUIPMENT. Medical clinical
324	324	equipment intended for use in the diagnosis or treatment of
325	325	medical conditions, which is used to provide institutional
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355	355	medical conditions, which is used to provide institutional
356	356	health services of a health care facility which are subject to
357	357	review, and which expenditure exceeds the thresholds
358	358	referenced in this section and in Section 22-21-263.
359	359	(10)(12) MODERNIZATION. The alteration, repair,
360	360	remodeling, and renovation of existing buildings, including
361	361	equipment within the existing buildings. Modernization does
362	362	not include the replacement of existing buildings which are
363	363	used by a health care facility to provide institutional health
364	364	services which are subject to review and does not include the
365	365	replacement of major medical equipment.
366	366	(11)(14) PERSON. Any personindividual, firm,
367	367	partnership, association, joint venture, corporation, limited
368	368	liability company, or other legal entity, the State of Alabama
369	369	and its political subdivisions or parts thereof, and any
370	370	agencies or instrumentalities and any combination of persons
371	371	herein specified, but person shallthe term does not include
372	372	the United States or any agency or instrumentality thereof,
373	373	except in the case of voluntary submission to the regulations
374	374	established by this article.
375	375	(12)(15) RURAL HEALTH CARE PROVIDER/APPLICANT/HOSPITAL.
376	376	A provider or applicant or hospital which is designated by the
377	377	United States government Health Care Financing Administration
378	378	as rural.
379	379	(13)(16) STATE HEALTH PLAN. a. A comprehensive plan
380	380	which is prepared triennially and reviewed at least annually
381	381	and revised as necessary by the Statewide Health Coordinating
382	382	Council, with the assistance of the State Health Planning and
383	383	Development Agency, and approved by the Governor.
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413	413	Development Agency, and approved by the Governor.
414	414	b. The Statewide Health Coordinating Council shall meet
415	415	at least annually to determine whether revisions for the State
416	416	Health Plan are necessary. If the Statewide Health
417	417	Coordinating Council fails to meet and to review or revise the
418	418	State Health Plan on an annual basis, there shall be no fees
419	419	required on all certificate of need applications filed with
420	420	the Certificate of Need Review Board until the Statewide
421	421	Health Coordinating Council meets and reviews or revises the
422	422	State Health Plan. For purposes of this paragraph, the annual
423	423	meeting of the Statewide Health Coordinating Council shall
424	424	occur on or before August 1 of each calendar year.
425	425	c. The State Health Plan shall provide for the
426	426	development of health programs and resources to assure that
427	427	quality health services will be available and accessible in a
428	428	manner which assures continuity of care, at reasonable costs,
429	429	for all residents of the state. Nothing in this section should
430	430	be construed as permitting expenditures for facilities,
431	431	services, or equipment which are inconsistent with the State
432	432	Health Plan.
433	433	(14)(17) STATE HEALTH PLANNING AND DEVELOPMENT AGENCY
434	434	(SHPDA)or STATE AGENCY or SHPDA . An agency of the State of
435	435	Alabama which is designated by the Governor as the sole State
436	436	Health Planning and Development Agency, which shall consist of
437	437	three consumers, three providers, and three representatives of
438	438	the Governor who all shall serve staggered terms and all be
439	439	appointed by the Governor. Where used in this article, the
440	440	terms, "state agency," and the "SHPDA," shall be synonymous
441	441	and may be used interchangeably.
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471	471	and may be used interchangeably.
472	472	(15)(18) STATEWIDE HEALTH COORDINATING COUNCIL. A
473	473	council, appointed by the Governor , established pursuant to
474	474	Sections 22-4-7 and 22-4-8 to advise the State Health Planning
475	475	and Development Agency on matters relating to health planning
476	476	and resource development and to perform other functions as may
477	477	be delegated to it, to include an annual review of the State
478	478	Health Plan.
479	479	(16)(13)TO OFFER. When used in connection with health
480	480	services, a health care facility or health maintenance
481	481	organization that holds itself out as capable of providing, or
482	482	as having the means for the provision of, specified health
483	483	services."
484	484	"§22-21-263
485	485	(a) All new institutional health services whichthat are
486	486	subject to this article and whichthat are proposed to be
487	487	offered or developed within the state shall be subject to
488	488	review under this article. No institutional health services
489	489	whichthat are subject to this article shall be permitted which
490	490	are inconsistent with the State Health Plan. For the purposes
491	491	of this article, new institutional health services shall
492	492	include any of the following:
493	493	(1) The construction, development, acquisition through
494	494	lease or purchase, or other establishment of a new health care
495	495	facility or health maintenance organization. A transaction
496	496	involving the sale, lease, or other transfer or change of
497	497	control of an existing health care facility, existing health
498	498	maintenance organization, or existing institutional health
499	499	service is not subject to certificate of need review or
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529	529	service is not subject to certificate of need review or
530	530	approval under this article unless the transaction also
531	531	involves implementing one or more of the new institutional
532	532	health services described in subdivision (2), (3), or (4). The
533	533	two immediately preceding sentences are applicable to all
534	534	transactions occurring on or after July 30, 1979.
535	535	Notwithstanding anything to the contrary in this article,
536	536	expenditures incurred in the sale, lease, or other transfer of
537	537	an existing health care facility or existing health
538	538	maintenance organization or existing institutional health
539	539	service shall not be subject to subdivision (2).
540	540	(2) Any expenditure by or on behalf of a health care
541	541	facility or health maintenance organization which, under
542	542	generally accepted accounting principles consistently applied,
543	543	is a capital expenditure in excess of two million dollars
544	544	($2,000,000) indexed annually for inflation for major medical
545	545	equipment; in excess of eight hundred thousand dollars
546	546	($800,000) for new annual operating costs indexed annually for
547	547	inflation; and in excess of four million dollars ($4,000,000)
548	548	indexed annually for inflation for any other capital
549	549	expenditure by or on behalf of a health care facility or a
550	550	health maintenance organization. The index referenced in this
551	551	subdivision shall be the Consumer Price Index Market Basket
552	552	Professional Medical Services index as published by the U.S.
553	553	Department of Labor, Bureau of Labor Statistics. The SHPDA
554	554	shall publish this index information to the general public.
555	555	(3) A change in the existing bed capacity of a health
556	556	care facility or health maintenance organization through the
557	557	addition of new beds, the relocation of one or more beds from
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587	587	addition of new beds, the relocation of one or more beds from
588	588	one physical facility to another, or reallocation among
589	589	services of existing beds through the conversion of one or
590	590	more beds from one category to another within the following
591	591	bed categories: general medical surgical, inpatient
592	592	psychiatric, inpatient/residential alcohol and drug abuse or
593	593	inpatient rehabilitation beds, or long-term care beds
594	594	including skilled nursing care, intermediate care,
595	595	transitional care, and swing beds. Notwithstanding any
596	596	provision of this subdivision to the contrary, any health care
597	597	facility or health maintenance organization in which at least
598	598	65 percent of the beds are dedicated or used exclusively for
599	599	acute care services, general medical surgical, or
600	600	nonspecialized services may reallocate existing beds within
601	601	the following specialized bed categories: inpatient
602	602	psychiatric, inpatient/residential alcohol and drug
603	603	rehabilitation beds , to acute care services , or general
604	604	medical surgical beds without first obtaining a certificate of
605	605	need from the SHPDA.
606	606	(4) Health services proposed to be offered in or
607	607	through a health care facility or health maintenance
608	608	organization, and which were not offered on a regular basis in
609	609	or through suchthe health care facility or health maintenance
610	610	organization within the 12 month12-month period prior to the
611	611	time suchthe services would be offered. Health services, other
612	612	than those health services involving long-term care services,
613	613	including, without limitation, skilled and intermediate
614	614	nursing home care, swing beds services, or transitional care
615	615	services, provided directly by acute care hospitals classified
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645	645	services, provided directly by acute care hospitals classified
646	646	as rural by the U.S. Bureau of Census/OfficeCensus, Office of
647	647	Management and Budget, United States government Health Care
648	648	Financing Administration or acute care hospitals with less
649	649	than 105 beds that are located over 20 miles from the nearest
650	650	acute health care facility located within Alabama shall not be
651	651	subject to this subdivision but shall be subject to the other
652	652	subdivisions of this subsection. Provided, however, that the
653	653	exemption from this subdivision herein established shall not
654	654	apply to home health services provided outside of the county
655	655	in which the hospital is located.
656	656	(b) The four conditions of new institutional health
657	657	services listed in this section shall be mutually exclusive.
658	658	(c) Notwithstanding all other provisions of this
659	659	article to the contrary, those facilities and distinct units
660	660	operated by the Department of Mental Health and those
661	661	facilities and distinct units operating under contract or
662	662	subcontract with the Department of Mental Health where the
663	663	contract constitutes the primary source of income to the
664	664	facility shall not be subject to review under this article.
665	665	(d) For the purposes of this article, and
666	666	notwithstanding all other provisions of this article to the
667	667	contrary and notwithstanding any and all provisions of the
668	668	State Health Plan on September 1, 2003, relating to
669	669	lithotripsy, magnetic resonance imaging, and positron emission
670	670	tomography, new institutional health services , which that are
671	671	subject to this article , shall not include any health services
672	672	provided by a mobile or fixed-based extracorporeal shock wave
673	673	lithotripter, mobile or fixed-based magnetic resonance
674	674	309
675	675	310
676	676	311
677	677	312
678	678	313
679	679	314
680	680	315
681	681	316
682	682	317
683	683	318
684	684	319
685	685	320
686	686	321
687	687	322
688	688	323
689	689	324
690	690	325
691	691	326
692	692	327
693	693	328
694	694	329
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696	696	331
697	697	332
698	698	333
699	699	334
700	700	335
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703	703	lithotripter, mobile or fixed-based magnetic resonance
704	704	imaging, or positron emission tomography proposed to be
705	705	offered in or through a health care facility or health
706	706	maintenance organization. The SHPDA, after consultation with
707	707	and the advice of the Statewide Health Coordinating Council,
708	708	in accordance with the Alabama Administrative Procedure Act
709	709	and within 60 days of September 1, 2003, shall cause the State
710	710	Health Plan to be amended to repeal and delete all sections of
711	711	the Alabama State Health Plan relating to mobile and
712	712	fixed-based lithotripters, mobile and fixed-based magnetic
713	713	resonance imaging, and positron emission tomography, and cause
714	714	the amendment and repeal of any other SHPDA rules and
715	715	regulations inconsistent with this article. "
716	716	"§22-21-264
717	717	The SHPDA, pursuant to the provisions of Section
718	718	22-21-274, shall prescribe by rules and regulations the
719	719	criteria and clarifying definitions for reviews covered by
720	720	this article. These criteria shall include at least the
721	721	following:
722	722	(1) Consistency with the appropriate State Health
723	723	Facility and services plans effective at the time the
724	724	application was received by the State Agency, which shall
725	725	include the latest approved revisions of the following plans:
726	726	a. The most recent Alabama State Health Plan which
727	727	shall include updated inventories and separate bed need
728	728	methodologies for inpatient rehabilitation beds , inpatient
729	729	psychiatric beds and inpatient/residential alcohol and drug
730	730	abuse beds.
731	731	b. Alabama State Health Plan for services to the
732	732	337
733	733	338
734	734	339
735	735	340
736	736	341
737	737	342
738	738	343
739	739	344
740	740	345
741	741	346
742	742	347
743	743	348
744	744	349
745	745	350
746	746	351
747	747	352
748	748	353
749	749	354
750	750	355
751	751	356
752	752	357
753	753	358
754	754	359
755	755	360
756	756	361
757	757	362
758	758	363
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761	761	b. Alabama State Health Plan for services to the
762	762	mentally ill.
763	763	c. Alabama State Health Plan for rehabilitation
764	764	facilities.
765	765	d. Alabama developmental disabilities plan.
766	766	e. Alabama Statestate alcoholism plan.
767	767	f. Such otherOtherstate plansState Plans as may from
768	768	time to time be required by state or federal statute.
769	769	(2) The relationship of services reviewed to theany
770	770	long-range development plan (if any) of the person providing
771	771	or proposing such services.
772	772	(3) The availability of alternative, less costly , or
773	773	more effective methods of providing such services.
774	774	(4) Determination of a substantially unmet public
775	775	requirement for the proposed health care facility, service , or
776	776	capital expenditure that is consistent with orderly planning
777	777	within the state and the community for furnishing
778	778	comprehensive health care , such determination to be
779	779	established on the merits of the proposal after giving
780	780	appropriate consideration to all of the following :
781	781	a. Financial feasibility of the proposed change in
782	782	service ofor facility;.
783	783	b. Specific data supporting the demonstration of need
784	784	for the proposed change in facility or service shall be
785	785	reasonable, relevant , and appropriate ;.
786	786	c. Evidence of evaluation and consistency of the
787	787	proposed change in facility or service with the facility's and
788	788	the community's overall health and health-related plans ;.
789	789	d. Evidence of consistency of the proposal with the
790	790	365
791	791	366
792	792	367
793	793	368
794	794	369
795	795	370
796	796	371
797	797	372
798	798	373
799	799	374
800	800	375
801	801	376
802	802	377
803	803	378
804	804	379
805	805	380
806	806	381
807	807	382
808	808	383
809	809	384
810	810	385
811	811	386
812	812	387
813	813	388
814	814	389
815	815	390
816	816	391
817	817	392 SB285 INTRODUCED
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819	819	d. Evidence of consistency of the proposal with the
820	820	need to meet nonpatient care objectives of the facility such
821	821	as teaching and research ;.
822	822	e. Evidence of review of the proposed facility,
823	823	service, or capital expenditure when appropriate and requested
824	824	by other state agencies.
825	825	f. Evidence of the locational appropriateness of the
826	826	location of the proposed facility or service ,such
827	827	asincluding, but not limited to, transportation accessibility,
828	828	manpower availability, local zoning , and environmental health ,
829	829	etc.;.
830	830	g. Reasonable potential of the facility to meet
831	831	licensure standards.
832	832	h. Reasonable consideration shall be given to medical
833	833	facilitiesConsideration of whether the proposed facility or
834	834	service will be involved in medical education.
835	835	(5) Determination that the person applying is an
836	836	appropriate applicant, or the most appropriate applicant in
837	837	the event of duplicative applications, for providing the
838	838	proposed health care facility or service, such determination
839	839	to be established from the evidence as toof the ability of the
840	840	person, directly or indirectly, to render adequate service to
841	841	the public, including affirmative evidence as to the
842	842	following:
843	843	a. Professional capability of the facility proposing
844	844	the capital expenditure ;.
845	845	b. Management capability of the facility proposing the
846	846	capital expenditure ;.
847	847	c. Adequate manpower to enable the facility to offer
848	848	393
849	849	394
850	850	395
851	851	396
852	852	397
853	853	398
854	854	399
855	855	400
856	856	401
857	857	402
858	858	403
859	859	404
860	860	405
861	861	406
862	862	407
863	863	408
864	864	409
865	865	410
866	866	411
867	867	412
868	868	413
869	869	414
870	870	415
871	871	416
872	872	417
873	873	418
874	874	419
875	875	420 SB285 INTRODUCED
876	876	Page 16
877	877	c. Adequate manpower to enable the facility to offer
878	878	the proposed service ;.
879	879	d. Evidence of the existence of the applicant's
880	880	long-range planning program and an ongoing planning process ;.
881	881	e. Evidence of existing and ongoing monitoring of
882	882	utilization and the fulfilling of unmet or under metunder-met
883	883	health needs in the case of expansion ;.
884	884	f. Evidence of communication with all planning,
885	885	regulatory, and utility agencies and organizations that
886	886	influence the facility's destiny.
887	887	(6) Consideration of the special needs and
888	888	circumstances of those entities which provide a substantial
889	889	portion of their services or resources, or both, to
890	890	individuals not residing in the health service area in which
891	891	the entities are located or in adjacent health service areas.
892	892	(7) The special needs and circumstances of health
893	893	maintenance organizations.
894	894	(8) In case of a construction project, consideration
895	895	shall be given to both of the following :
896	896	a. The costs and methods of the proposed construction
897	897	including the costs and methods of energy provision ; and.
898	898	b. The probable impact of the construction project
899	899	reviewed on the costs of providing health services."
900	900	"§22-21-265
901	901	(a) On or after July 30, 1979, no No person to which
902	902	this article applies shall acquire, construct, or operate a
903	903	new institutional health service, as defined in this article,
904	904	or furnish or offer, or purport to furnish a new institutional
905	905	health service, as defined in this article, or make an
906	906	421
907	907	422
908	908	423
909	909	424
910	910	425
911	911	426
912	912	427
913	913	428
914	914	429
915	915	430
916	916	431
917	917	432
918	918	433
919	919	434
920	920	435
921	921	436
922	922	437
923	923	438
924	924	439
925	925	440
926	926	441
927	927	442
928	928	443
929	929	444
930	930	445
931	931	446
932	932	447
933	933	448 SB285 INTRODUCED
934	934	Page 17
935	935	health service, as defined in this article, or make an
936	936	arrangement or commitment for financing the offering of a new
937	937	institutional health service, unless the person shall first
938	938	obtain from the SHPDA a certificate of need therefor.
939	939	(b) Notwithstanding any provisionsprovision of this
940	940	article to the contrary, those facilities and distinct units
941	941	operated by the Department of Mental Health, and those
942	942	facilities and distinct units operating under contract or
943	943	subcontract with the Department of Mental Health where the
944	944	contract constitutes the primary source of income to the
945	945	facility, shall not be required to obtain a certificate of
946	946	need under this article.
947	947	(b)(c)(1) Notwithstanding allany other
948	948	provisionsprovision of this article to the contrary, the
949	949	replacement of equipment by health care facilities shall be
950	950	exempt from certificate of need review, provided:
951	951	(1)a. The replacement does not change the purpose, use,
952	952	or application of the equipment .;
953	953	(2)b. The existing equipment is taken out of service .;
954	954	(3)c. The replacement equipment does not enable the
955	955	health care facility to expand its health services .; and
956	956	(4)d. The replacement equipment does not enable the
957	957	health care facility to provide any health services not
958	958	previously provided on a regular basis.
959	959	(2) A determination of whether the acquisition of
960	960	equipment is exempt from review under this section shall be
961	961	made by the Executive Director of the SHPDA upon the filing of
962	962	an application requesting the determination, on the form or
963	963	forms prescribed by the CON Review Board, together with a fee
964	964	449
965	965	450
966	966	451
967	967	452
968	968	453
969	969	454
970	970	455
971	971	456
972	972	457
973	973	458
974	974	459
975	975	460
976	976	461
977	977	462
978	978	463
979	979	464
980	980	465
981	981	466
982	982	467
983	983	468
984	984	469
985	985	470
986	986	471
987	987	472
988	988	473
989	989	474
990	990	475
991	991	476 SB285 INTRODUCED
992	992	Page 18
993	993	forms prescribed by the CON Review Board, together with a fee
994	994	in the amount of 20 percent of the fee provided in Section
995	995	22-21-271. If it is determined that the replacement is not
996	996	reviewable pursuant to this section, the applicant shall be
997	997	notified in writing that no certificate of need is required.
998	998	The SHPDA shall define an appeals process.
999	999	(d) Any provision in this article to the contrary
1000	1000	notwithstanding, a rural hospital shall only be required to
1001	1001	submit a fee equal to 25 percent of the fee applicable to
1002	1002	non-rural hospitals when filing a request for determination
1003	1003	under this section.
1004	1004	(c)(e) Notwithstanding any other provision of this
1005	1005	article to the contrary, the modernization or construction of
1006	1006	a nonclinical building, parking facility, or any other
1007	1007	noninstitutional health services capital item on the existing
1008	1008	campus of a health care facility shall be exempt from
1009	1009	certificate of need review, provided the construction or
1010	1010	modernization does not allow the health care facility to
1011	1011	provide new institutional health services subject to review
1012	1012	and not previously provided on a regular basis.
1013	1013	(d)(f) The SHPDA shall maintain the Alabama State
1014	1014	Health Plan to include separate bed need methodologies for
1015	1015	inpatient psychiatric services, inpatient rehabilitation
1016	1016	services, and inpatient/residential alcohol and drug abuse
1017	1017	services. The SHPDA shall utilize these methodologies in
1018	1018	considering all certificate of need applications.
1019	1019	(e)(g) Notwithstanding allany other provisionsprovision
1020	1020	of this article to the contrary, the increase in the number of
1021	1021	nursing home beds of a health care facility licensed pursuant
1022	1022	477
1023	1023	478
1024	1024	479
1025	1025	480
1026	1026	481
1027	1027	482
1028	1028	483
1029	1029	484
1030	1030	485
1031	1031	486
1032	1032	487
1033	1033	488
1034	1034	489
1035	1035	490
1036	1036	491
1037	1037	492
1038	1038	493
1039	1039	494
1040	1040	495
1041	1041	496
1042	1042	497
1043	1043	498
1044	1044	499
1045	1045	500
1046	1046	501
1047	1047	502
1048	1048	503
1049	1049	504 SB285 INTRODUCED
1050	1050	Page 19
1051	1051	nursing home beds of a health care facility licensed pursuant
1052	1052	to Section 22-21-260(6) as a skilled nursing care facility or
1053	1053	an intermediate care facility, but excluding an increase in
1054	1054	the bed capacity of an intermediate care facility designated
1055	1055	as an ICF-MR by the State Board ofCommittee on Public Health
1056	1056	and operated by the state Department of Mental Health which
1057	1057	facilities shall beare governed by the other provisions of
1058	1058	this article, shall be exempt from certificate of need review,
1059	1059	provided:
1060	1060	(1) The increase does not exceed 10 percent of the
1061	1061	total skilled nursing beds of the facility, rounded to the
1062	1062	nearest whole number, or 10 beds, whichever is greater.
1063	1063	(2) The average rate of occupancy for the nursing home
1064	1064	beds of the facility is not less than 95 percent, rounded to
1065	1065	the nearest whole number, for the 24-month period ending on
1066	1066	June 30 of the year immediately preceding the application for
1067	1067	exemption from the certificate of need review.
1068	1068	(3) The aggregate average rate of occupancy for all
1069	1069	other skilled nursing facilities and intermediate nursing
1070	1070	facilities in the same county as the requesting facility's is
1071	1071	not less than 95 percent, rounded to the nearest whole number,
1072	1072	for the 24-month period ending on June 30 of the year
1073	1073	immediately preceding the application for exemption from
1074	1074	certificate of need review.
1075	1075	(4) The increase does not require capital expenditures
1076	1076	exceeding the capital expenditure thresholds prescribed in
1077	1077	Section 22-21-263(a)(2).
1078	1078	(5) The facility has not been granted an increase of
1079	1079	beds under this exemption within the immediately preceding
1080	1080	505
1081	1081	506
1082	1082	507
1083	1083	508
1084	1084	509
1085	1085	510
1086	1086	511
1087	1087	512
1088	1088	513
1089	1089	514
1090	1090	515
1091	1091	516
1092	1092	517
1093	1093	518
1094	1094	519
1095	1095	520
1096	1096	521
1097	1097	522
1098	1098	523
1099	1099	524
1100	1100	525
1101	1101	526
1102	1102	527
1103	1103	528
1104	1104	529
1105	1105	530
1106	1106	531
1107	1107	532 SB285 INTRODUCED
1108	1108	Page 20
1109	1109	beds under this exemption within the immediately preceding
1110	1110	24-month period.
1111	1111	In calculating the average occupancy for the facility
1112	1112	under subdivision (2) of this subsection and for all other
1113	1113	skilled and intermediate nursing facilities in the same county
1114	1114	under subdivision (3) of this subsection , beds previously
1115	1115	granted, including beds granted after January 1, 1995, to the
1116	1116	facility, and to other skilled or intermediate nursing
1117	1117	facilities in the same county as the requesting facility,
1118	1118	pursuant to a certificate of need or to this exemption shall
1119	1119	be deemed built and available for occupancy as of the date
1120	1120	granted regardless of when the beds were placed in service.
1121	1121	SHPDA shall promulgate regulations adopt rules to determine how
1122	1122	occupancy shall be calculated for the purpose of this
1123	1123	subsection, taking into account certain factors such as, but
1124	1124	without limitation, disregarding beds that have not been
1125	1125	available for use for the three years next preceding the
1126	1126	period for which occupancy is being measured.
1127	1127	(6) The facility has had an average daily census
1128	1128	comprised of 40 percent of Medicaid patients within the fiscal
1129	1129	year ended June 30 immediately prior to filing an application
1130	1130	for exemption under this section.
1131	1131	(7)a. Any exemption to add beds without a certificate
1132	1132	of need shall expire and be deemed null and void unless the
1133	1133	beds are placed in service not less than 12 months after the
1134	1134	date the exemption is granted. Notwithstanding the foregoing,
1135	1135	SHPDA may promulgateadopt rules permitting the Executive
1136	1136	Director of SHPDA to grant one extension not to exceed
1137	1137	twelve12 months upon a showing of substantial progress.
1138	1138	533
1139	1139	534
1140	1140	535
1141	1141	536
1142	1142	537
1143	1143	538
1144	1144	539
1145	1145	540
1146	1146	541
1147	1147	542
1148	1148	543
1149	1149	544
1150	1150	545
1151	1151	546
1152	1152	547
1153	1153	548
1154	1154	549
1155	1155	550
1156	1156	551
1157	1157	552
1158	1158	553
1159	1159	554
1160	1160	555
1161	1161	556
1162	1162	557
1163	1163	558
1164	1164	559
1165	1165	560 SB285 INTRODUCED
1166	1166	Page 21
1167	1167	twelve12 months upon a showing of substantial progress.
1168	1168	Notwithstanding the foregoing, any exemption granted by the
1169	1169	SHPDA prior to April 10, 1995, for facilities which have
1170	1170	agreed to the provisions of the June 21, 1995 consent decree,
1171	1171	is ratified and confirmed and shall be deemed to have been
1172	1172	granted in accordance with this subsection. In addition, any
1173	1173	facility which was granted an exemption by the SHPDA prior to
1174	1174	April 10, 1995, is ratified and confirmed and shall be deemed
1175	1175	to have been approved as of the latter of the actual date
1176	1176	approved or March 3, 1995 , and to have been granted in
1177	1177	accordance with this subsection.
1178	1178	b. A determination of whether the increase in beds is
1179	1179	exempt from review under this section shall be made by the
1180	1180	Executive Director of SHPDA upon the filing of an application
1181	1181	requesting the determination, on the form or forms prescribed
1182	1182	by the CON Review Board, together with a fee in an amount to
1183	1183	be determined by the review board in accordance with Section
1184	1184	22-21-271(a). The SHPDA shall promulgateadopt rules affording
1185	1185	an applicant pursuant to this subsection a right to appeal
1186	1186	adverse rulings.
1187	1187	c. Applications pursuant to this section for exemption
1188	1188	from certificate of need review for an increase in bed
1189	1189	capacity shall be made only during the 90-day period beginning
1190	1190	January 1 through March 31 of each year.
1191	1191	d. The provisions of this section shall automatically
1192	1192	terminate and become null and void on December 31, 2005,
1193	1193	unless a bill to continue or reestablish the provisions of
1194	1194	this section shall be passed by both houses of the Legislature
1195	1195	and enacted into law.
1196	1196	561
1197	1197	562
1198	1198	563
1199	1199	564
1200	1200	565
1201	1201	566
1202	1202	567
1203	1203	568
1204	1204	569
1205	1205	570
1206	1206	571
1207	1207	572
1208	1208	573
1209	1209	574
1210	1210	575
1211	1211	576
1212	1212	577
1213	1213	578
1214	1214	579
1215	1215	580
1216	1216	581
1217	1217	582
1218	1218	583
1219	1219	584
1220	1220	585
1221	1221	586
1222	1222	587
1223	1223	588 SB285 INTRODUCED
1224	1224	Page 22
1225	1225	and enacted into law.
1226	1226	(f)(h) Notwithstanding all other provisions of this
1227	1227	article to the contrary, an existing home health agency may
1228	1228	accept referrals of patients from outside its Medicare
1229	1229	certified service area without obtaining a certificate of
1230	1230	need, provided all of the following conditions are met:
1231	1231	(1) The county of the referral is contiguous to a
1232	1232	county for which the home health agency holds a certificate of
1233	1233	need or an exemption granted pursuant to provisions of Section
1234	1234	22-21-263.
1235	1235	(2) The home health agency establishes no branch office
1236	1236	in the county of the referral.
1237	1237	(3) The home health agency incurs no capital
1238	1238	expenditures in the county of the referral in excess of five
1239	1239	hundred dollars ($500).
1240	1240	The home health agency shall notify the SHPDA that it
1241	1241	has begun accepting referrals from a county contiguous to its
1242	1242	service area within 14 days of the receipt of the first
1243	1243	referral from the contiguous county. No notice to the SHPDA
1244	1244	shall be required related to subsequent referrals in the same
1245	1245	contiguous county. The SHPDA shall take steps to provide for
1246	1246	the inclusion of statistical information relating to the
1247	1247	service to referrals outside the Medicare certified service
1248	1248	area in its annual statistical reports. The SHPDA may impose,
1249	1249	by rule, a reasonable charge upon home health agencies
1250	1250	accepting such referrals to cover the additional cost of
1251	1251	gathering and processing the information.
1252	1252	(g)(i) Notwithstanding allany other provisionsprovision
1253	1253	of this article to the contrary, the replacement, including
1254	1254	589
1255	1255	590
1256	1256	591
1257	1257	592
1258	1258	593
1259	1259	594
1260	1260	595
1261	1261	596
1262	1262	597
1263	1263	598
1264	1264	599
1265	1265	600
1266	1266	601
1267	1267	602
1268	1268	603
1269	1269	604
1270	1270	605
1271	1271	606
1272	1272	607
1273	1273	608
1274	1274	609
1275	1275	610
1276	1276	611
1277	1277	612
1278	1278	613
1279	1279	614
1280	1280	615
1281	1281	616 SB285 INTRODUCED
1282	1282	Page 23
1283	1283	of this article to the contrary, the replacement, including
1284	1284	relocation in the same county, of an existing acute care
1285	1285	hospital by the construction of a new digital hospital shall
1286	1286	be exempt from certificate of need review provided the
1287	1287	hospital meets all of the following:
1288	1288	(1) The digital hospital design incorporates a fully
1289	1289	automated, centralized, digital system to integrate all
1290	1290	current and future medical technologies with capabilities for
1291	1291	all systems to interface in a comprehensive medical record.
1292	1292	The integration of medical technology shall include, but not
1293	1293	be limited to, all patient medical records, diagnostic images,
1294	1294	diagnostic reports, laboratory results, pharmacy data,
1295	1295	pharmacological interactions, contraindications, surgical
1296	1296	reports, surgical streaming video, pathology reports, unique
1297	1297	patient identification, voice activated transcription,
1298	1298	wireless applications, automated billing with electronic
1299	1299	transmission capability, and electronic procurement systems.
1300	1300	(2) The electronic medical systems shall interface on a
1301	1301	single electronic platform to produce the most favorable
1302	1302	patient outcome with a reduction in medical errors.
1303	1303	(3) Medical records shall only be accessed by
1304	1304	authorized clinical personnel who are provided access by
1305	1305	hospital consoles, physician offices, physician homes, or any
1306	1306	remote location via unique identification requirements.
1307	1307	(4) Patient rooms shall be designed to provide optimal
1308	1308	electronic documentation of vital signs, real-time data entry,
1309	1309	any and all treatment protocols, physician orders, and patient
1310	1310	progression.
1311	1311	(5) The digital hospital shall have a minimum project
1312	1312	617
1313	1313	618
1314	1314	619
1315	1315	620
1316	1316	621
1317	1317	622
1318	1318	623
1319	1319	624
1320	1320	625
1321	1321	626
1322	1322	627
1323	1323	628
1324	1324	629
1325	1325	630
1326	1326	631
1327	1327	632
1328	1328	633
1329	1329	634
1330	1330	635
1331	1331	636
1332	1332	637
1333	1333	638
1334	1334	639
1335	1335	640
1336	1336	641
1337	1337	642
1338	1338	643
1339	1339	644 SB285 INTRODUCED
1340	1340	Page 24
1341	1341	(5) The digital hospital shall have a minimum project
1342	1342	cost of one hundred million dollars ($100,000,000) to include
1343	1343	design, systems, property, buildings, equipment, and
1344	1344	electronic software development.
1345	1345	(6) The construction and design of the facility shall
1346	1346	utilize technology and materials for patient flow to limit
1347	1347	general public contact with patient care areas,
1348	1348	healthcarehealth care workers, and hazardous materials to
1349	1349	reduce the potential for cross-contamination and resulting
1350	1350	direct medical costs.
1351	1351	(7) The digital hospital environment shall be energy
1352	1352	efficient, cost effective, and clinically designed to produce
1353	1353	the most favorable environment.
1354	1354	(8) The digital hospital shall meet all of the
1355	1355	following conditions:
1356	1356	a. Operate as an acute care hospital.
1357	1357	b. Replace an existing acute care hospital located in
1358	1358	the same county as the digital hospital.
1359	1359	c. Be licensed for no more than the same number of
1360	1360	hospital beds and for the same bed categories as the existing
1361	1361	acute care hospital to be replaced by the digital hospital,
1362	1362	unless otherwise approved by the Certificate of Need Review
1363	1363	Board through issuance of a certificate of need.
1364	1364	d. Shall not exceed the same scope of health services,
1365	1365	including the same amount of diagnostic or therapeutic major
1366	1366	medical equipment, as the existing acute care hospital to be
1367	1367	replaced by the digital hospital, unless otherwise approved by
1368	1368	the SHPDA approval process.
1369	1369	e. Shall not exceed the number of inpatient and
1370	1370	645
1371	1371	646
1372	1372	647
1373	1373	648
1374	1374	649
1375	1375	650
1376	1376	651
1377	1377	652
1378	1378	653
1379	1379	654
1380	1380	655
1381	1381	656
1382	1382	657
1383	1383	658
1384	1384	659
1385	1385	660
1386	1386	661
1387	1387	662
1388	1388	663
1389	1389	664
1390	1390	665
1391	1391	666
1392	1392	667
1393	1393	668
1394	1394	669
1395	1395	670
1396	1396	671
1397	1397	672 SB285 INTRODUCED
1398	1398	Page 25
1399	1399	e. Shall not exceed the number of inpatient and
1400	1400	outpatient surgical suites as contained in the existing acute
1401	1401	care hospital to be replaced by the digital hospital, unless
1402	1402	otherwise approved by the SHPDA approval process.
1403	1403	(9) The existing acute care hospital, replaced by the
1404	1404	digital hospital, shall be taken out of service as an acute
1405	1405	care hospital and shall not be converted to or used as another
1406	1406	health care facility, unless approved by the Certificate of
1407	1407	Need Review Board through issuance of a certificate of need.
1408	1408	(10) Any presently reviewable health service which is
1409	1409	proposed to be offered by the digital hospital which was not
1410	1410	offered on a regular basis within the preceding
1411	1411	twelve-month12-month period in or through the existing acute
1412	1412	care hospital to be replaced by the digital hospital shall be
1413	1413	subject to Certificate of Need Review Board approval through
1414	1414	issuance of a certificate of need.
1415	1415	(11) The only digital hospital exempt from certificate
1416	1416	of need review shall be the first digital hospital developed
1417	1417	in the state, and the digital hospital shall be located in a
1418	1418	county where there is located an accredited medical school and
1419	1419	teaching facility and not less than 3,000 licensed general
1420	1420	hospital beds, and construction shall be commenced within one
1421	1421	year from the issuance of a certificate of need by SHPDA.
1422	1422	(12) A determination whether the construction of a
1423	1423	digital hospital is exempt from review under this subsection
1424	1424	shall be made by the Executive Director of the SHPDA, upon the
1425	1425	filing of an application requesting the determination, on the
1426	1426	forms acceptable to the Executive Director of SHPDA together
1427	1427	with an application fee as provided in Section 22-21-271. If
1428	1428	673
1429	1429	674
1430	1430	675
1431	1431	676
1432	1432	677
1433	1433	678
1434	1434	679
1435	1435	680
1436	1436	681
1437	1437	682
1438	1438	683
1439	1439	684
1440	1440	685
1441	1441	686
1442	1442	687
1443	1443	688
1444	1444	689
1445	1445	690
1446	1446	691
1447	1447	692
1448	1448	693
1449	1449	694
1450	1450	695
1451	1451	696
1452	1452	697
1453	1453	698
1454	1454	699
1455	1455	700 SB285 INTRODUCED
1456	1456	Page 26
1457	1457	with an application fee as provided in Section 22-21-271. If
1458	1458	it is determined that the replacement facility is not
1459	1459	reviewable pursuant to this section, SHPDA shall notify the
1460	1460	applicant in writing that the application is exempt from
1461	1461	certificate of need review and shall issue a certificate of
1462	1462	need. The applicant shall have a right of may appeal from any
1463	1463	adverse ruling denying exemption , and the SHPDA shall
1464	1464	promulgateadopt rules affording an applicant a right to appeal
1465	1465	adverse rulings pursuant to this subsection.
1466	1466	(13) The provisions of this subsection shall
1467	1467	automatically terminate and become null and void upon the
1468	1468	issuance of the first certificate of need for the construction
1469	1469	and operation of a digital replacement hospital as herein
1470	1470	provided or on December 31, 2005, whichever first occurs,
1471	1471	unless a bill to continue or reestablish the provisions of
1472	1472	this subsection shall be passed by both houses of the
1473	1473	Legislature and enacted into law .
1474	1474	(j) Notwithstanding any other provision of this article
1475	1475	to the contrary, the acquisition, construction, operation, or
1476	1476	furnishing of a new institutional health service that provides
1477	1477	any of the following shall be exempt from certificate of need
1478	1478	review:
1479	1479	(1) Obstetric care, whether to be rendered in a
1480	1480	freestanding birth center or in a maternity ward in any
1481	1481	existing hospital.
1482	1482	(2) A neonatal intensive care unit.
1483	1483	(3) Mental health services as defined by Section
1484	1484	22-56-2, regardless of whether the services are rendered in a
1485	1485	freestanding facility or unit within an existing hospital on
1486	1486	701
1487	1487	702
1488	1488	703
1489	1489	704
1490	1490	705
1491	1491	706
1492	1492	707
1493	1493	708
1494	1494	709
1495	1495	710
1496	1496	711
1497	1497	712
1498	1498	713
1499	1499	714
1500	1500	715
1501	1501	716
1502	1502	717
1503	1503	718
1504	1504	719
1505	1505	720
1506	1506	721
1507	1507	722
1508	1508	723
1509	1509	724
1510	1510	725
1511	1511	726
1512	1512	727
1513	1513	728 SB285 INTRODUCED
1514	1514	Page 27
1515	1515	freestanding facility or unit within an existing hospital on
1516	1516	an inpatient or outpatient basis, including a designated
1517	1517	mental health facility as defined by Section 22-52-1.1 ."
1518	1518	Section 2. This act shall become effective on October
1519	1519	1, 2025.
1520	1520	729
1521	1521	730
1522	1522	731
1523	1523	732