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General Assembly Raised Bill No. 440
February Session, 2024
LCO No. 2995
Referred to Committee on PUBLIC HEALTH
Introduced by:
(PH)
AN ACT CONCERNING CERTIFICATES OF NEED.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 19a-638 of the 2024 supplement to the general 1
statutes is repealed and the following is substituted in lieu thereof 2
(Effective October 1, 2024): 3
(a) A certificate of need issued by the unit shall be required for: 4
(1) The establishment of a new health care facility; 5
(2) A transfer of ownership of a health care facility; 6
(3) A transfer of ownership of a large group practice to any entity 7
other than a (A) physician, or (B) group of two or more physicians, 8
legally organized in a partnership, professional corporation or limited 9
liability company formed to render professional services and not 10
employed by or an affiliate of any hospital, medical foundation, 11
insurance company or other similar entity; 12
(4) The establishment of a freestanding emergency department; 13 Raised Bill No. 440
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(5) The termination of inpatient or outpatient services offered by a 14
hospital, including, but not limited to, the termination by a short-term 15
acute care general hospital or children's hospital of inpatient and 16
outpatient mental health and substance abuse services; 17
(6) The establishment of an outpatient surgical facility, as defined in 18
section 19a-493b, or as established by a short-term acute care general 19
hospital; 20
(7) The termination of surgical services by an outpatient surgical 21
facility, as defined in section 19a-493b, or a facility that provides 22
outpatient surgical services as part of the outpatient surgery department 23
of a short-term acute care general hospital, provided termination of 24
outpatient surgical services due to (A) insufficient patient volume, or (B) 25
the termination of any subspecialty surgical service, shall not require 26
certificate of need approval; 27
(8) The termination of an emergency department by a short-term 28
acute care general hospital; 29
(9) The establishment of cardiac services, including inpatient and 30
outpatient cardiac catheterization, interventional cardiology and 31
cardiovascular surgery; 32
(10) The acquisition of computed tomography scanners, magnetic 33
resonance imaging scanners, positron emission tomography scanners or 34
positron emission tomography-computed tomography scanners, by any 35
person, physician, provider, short-term acute care general hospital or 36
children's hospital, except (A) as provided for in subdivision (22) of 37
subsection (b) of this section, and (B) a certificate of need issued by the 38
unit shall not be required where such scanner is a replacement for a 39
scanner that was previously acquired through certificate of need 40
approval or a certificate of need determination, including a replacement 41
scanner that has dual modalities or functionalities if the applicant 42
already offers similar imaging services for each of the scanner's 43
modalities or functionalities that will be utilized; 44 Raised Bill No. 440
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(11) The acquisition of nonhospital based linear accelerators, except a 45
certificate of need issued by the unit shall not be required where such 46
accelerator is a replacement for an accelerator that was previously 47
acquired through certificate of need approval or a certificate of need 48
determination; 49
(12) An increase in the licensed bed capacity of a health care facility, 50
except as provided in subdivision (23), subparagraph (C) of subdivision 51
(26) and subdivision (28) of subsection (b) of this section; 52
(13) The acquisition of equipment utilizing technology that has not 53
previously been utilized in the state; 54
(14) An increase of two or more operating rooms within any three-55
year period, commencing on and after October 1, 2010, by an outpatient 56
surgical facility, as defined in section 19a-493b, or by a short-term acute 57
care general hospital; [and] 58
(15) The termination of inpatient or outpatient services offered by a 59
hospital or other facility or institution operated by the state that 60
provides services that are eligible for reimbursement under Title XVIII 61
or XIX of the federal Social Security Act, 42 USC 301, as amended from 62
time to time; 63
(16) The relocation of outpatient, behavioral health care, substance 64
use disorder, women's health care or emergency medical services 65
outside of the municipality in which such services are currently 66
provided; 67
(17) Any investment in a health care facility by a private equity 68
company in which the private equity company acquires a controlling 69
interest, either directly or indirectly, in a health care facility, or 70
otherwise obtains the ability to exercise operational control, managerial 71
control or decision-making authority over such facility; 72
(18) Any transaction in which a private equity company acquires a 73
controlling interest, either directly or indirectly, in a large group practice 74 Raised Bill No. 440
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of ten or more full-time equivalent physicians, or otherwise obtains the 75
ability to exercise operational control, managerial control or decision-76
making authority over such large group practice; and 77
(19) Any transaction involving a private equity company in which a 78
health care facility's assets would be increased or reduced. 79
(b) A certificate of need shall not be required for: 80
(1) Health care facilities owned and operated by the federal 81
government; 82
(2) The establishment of offices by a licensed private practitioner, 83
whether for individual or group practice, except when a certificate of 84
need is required in accordance with the requirements of section 19a-85
493b or subdivision (3), (10) or (11) of subsection (a) of this section; 86
(3) A health care facility operated by a religious group that 87
exclusively relies upon spiritual means through prayer for healing; 88
(4) Residential care homes, as defined in subsection (c) of section 19a-89
490, and nursing homes and rest homes, as defined in subsection (o) of 90
section 19a-490; 91
(5) An assisted living services agency, as defined in section 19a-490; 92
(6) Home health agencies, as defined in section 19a-490; 93
(7) Hospice services, as described in section 19a-122b; 94
(8) Outpatient rehabilitation facilities; 95
(9) Outpatient chronic dialysis services; 96
(10) Transplant services; 97
(11) Free clinics, as defined in section 19a-630; 98
(12) School-based health centers and expanded school health sites, as 99
such terms are defined in section 19a-6r, community health centers, as 100 Raised Bill No. 440
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defined in section 19a-490a, not-for-profit outpatient clinics licensed in 101
accordance with the provisions of chapter 368v and federally qualified 102
health centers; 103
(13) A program licensed or funded by the Department of Children 104
and Families, provided such program is not a psychiatric residential 105
treatment facility; 106
(14) Any nonprofit facility, institution or provider that has a contract 107
with, or is certified or licensed to provide a service for, a state agency or 108
department for a service that would otherwise require a certificate of 109
need. The provisions of this subdivision shall not apply to a short-term 110
acute care general hospital or children's hospital, or a hospital or other 111
facility or institution operated by the state that provides services that are 112
eligible for reimbursement under Title XVIII or XIX of the federal Social 113
Security Act, 42 USC 301, as amended; 114
(15) A health care facility operated by a nonprofit educational 115
institution exclusively for students, faculty and staff of such institution 116
and their dependents; 117
(16) An outpatient clinic or program operated exclusively by or 118
contracted to be operated exclusively by a municipality, municipal 119
agency, municipal board of education or a health district, as described 120
in section 19a-241; 121
(17) A residential facility for persons with intellectual disability 122
licensed pursuant to section 17a-227 and certified to participate in the 123
Title XIX Medicaid program as an intermediate care facility for 124
individuals with intellectual disabilities; 125
(18) Replacement of existing computed tomography scanners, 126
magnetic resonance imaging scanners, positron emission tomography 127
scanners, positron emission tomography-computed tomography 128
scanners, or nonhospital based linear accelerators, if such equipment 129
was acquired through certificate of need approval or a certificate of need 130
determination, provided a health care facility, provider, physician or 131 Raised Bill No. 440
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person notifies the unit of the date on which the equipment is replaced 132
and the disposition of the replaced equipment, including if a 133
replacement scanner has dual modalities or functionalities and the 134
applicant already offers similar imaging services for each of the 135
equipment's modalities or functionalities that will be utilized; 136
(19) Acquisition of cone-beam dental imaging equipment that is to be 137
used exclusively by a dentist licensed pursuant to chapter 379; 138
(20) The partial or total elimination of services provided by an 139
outpatient surgical facility, as defined in section 19a-493b, except as 140
provided in subdivision (6) of subsection (a) of this section and section 141
19a-639e; 142
(21) The termination of services for which the Department of Public 143
Health has requested the facility to relinquish its license; 144
(22) Acquisition of any equipment by any person that is to be used 145
exclusively for scientific research that is not conducted on humans; 146
(23) On or before June 30, 2026, an increase in the licensed bed 147
capacity of a mental health facility, provided (A) the mental health 148
facility demonstrates to the unit, in a form and manner prescribed by 149
the unit, that it accepts reimbursement for any covered benefit provided 150
to a covered individual under: (i) An individual or group health 151
insurance policy providing coverage of the type specified in 152
subdivisions (1), (2), (4), (11) and (12) of section 38a-469; (ii) a self-153
insured employee welfare benefit plan established pursuant to the 154
federal Employee Retirement Income Security Act of 1974, as amended 155
from time to time; or (iii) HUSKY Health, as defined in section 17b-290, 156
and (B) if the mental health facility does not accept or stops accepting 157
reimbursement for any covered benefit provided to a covered 158
individual under a policy, plan or program described in clause (i), (ii) or 159
(iii) of subparagraph (A) of this subdivision, a certificate of need for such 160
increase in the licensed bed capacity shall be required. 161
(24) The establishment at harm reduction centers through the pilot 162 Raised Bill No. 440
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program established pursuant to section 17a-673c; [or] 163
(25) On or before June 30, 2028, a birth center, as defined in section 164
19a-490, that is enrolled as a provider in the Connecticut medical 165
assistance program, as defined in section 17b-245g; 166
(26) On or before June 30, 2030, (A) the establishment or expansion of 167
diagnostic or therapeutic cardiac catheterization or cardiac surgery 168
units, psychiatric units, substance use disorder units or rural health 169
services, (B) upgrades to radiologic technology, (C) an increase of 170
behavioral health beds for children, (D) an increase in capacity for 171
existing services offered by a health care facility, and (E) an increase in 172
the number of operating rooms at a health care facility existing on or 173
before October 1, 2024; 174
(27) The relocation of outpatient services (A) within the municipality 175
in which such services are currently provided, or (B) not more than 176
twenty miles from the current location at which such services are 177
provided; or 178
(28) An increase or reduction in the licensed bed capacity of a health 179
care facility of not more than twelve beds within any two-year period, 180
commencing on and after October 1, 2024. 181
(c) (1) Any person, health care facility or institution that is unsure 182
whether a certificate of need is required under this section, or (2) any 183
health care facility that proposes to relocate pursuant to section 19a-184
639c, shall send a letter to the unit that describes the project and requests 185
that the unit make a determination as to whether a certificate of need is 186
required. In the case of a relocation of a health care facility, the letter 187
shall include information described in section 19a-639c. A person, health 188
care facility or institution making such request shall provide the unit 189
with any information the unit requests as part of its determination 190
process. The unit shall provide a determination within thirty days of 191
receipt of such request. 192
(d) The executive director of the Office of Health Strategy may 193 Raised Bill No. 440
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implement policies and procedures necessary to administer the 194
provisions of this section while in the process of adopting such policies 195
and procedures as regulation, provided the executive director holds a 196
public hearing prior to implementing the policies and procedures and 197
posts notice of intent to adopt regulations on the office's Internet web 198
site and the eRegulations System not later than twenty days after the 199
date of implementation. Policies and procedures implemented pursuant 200
to this section shall be valid until the time final regulations are adopted. 201
(e) On or before June 30, 2026, a mental health facility seeking to 202
increase licensed bed capacity without applying for a certificate of need, 203
as permitted pursuant to subdivision (23) of subsection (b) of this 204
section, shall notify the Office of Health Strategy, in a form and manner 205
prescribed by the executive director of said office, regarding (1) such 206
facility's intent to increase licensed bed capacity, (2) the address of such 207
facility, and (3) a description of all services that are being or will be 208
provided at such facility. 209
(f) Not later than January 1, 2025, the executive director of the Office 210
of Health Strategy shall report to the Governor and, in accordance with 211
the provisions of section 11-4a, to the joint standing committee of the 212
General Assembly having cognizance of matters relating to public 213
health concerning the executive director's recommendations, if any, 214
regarding the establishment of an expedited certificate of need process 215
for mental health facilities. 216
Sec. 2. Section 19a-639a of the 2024 supplement to the general statutes 217
is repealed and the following is substituted in lieu thereof (Effective 218
October 1, 2024): 219
(a) An application for a certificate of need shall be filed with the unit 220
in accordance with the provisions of this section and any regulations 221
adopted by the Office of Health Strategy. The application shall address 222
the guidelines and principles set forth in (1) subsection (a) of section 19a-223
639, and (2) regulations adopted by the department. The applicant shall 224
include with the application a nonrefundable application fee based on 225 Raised Bill No. 440
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the cost of the project. The amount of the fee shall be as follows: (A) One 226
thousand dollars for a project that will cost not greater than fifty 227
thousand dollars; (B) two thousand dollars for a project that will cost 228
greater than fifty thousand dollars but not greater than one hundred 229
thousand dollars; (C) three thousand dollars for a project that will cost 230
greater than one hundred thousand dollars but not greater than five 231
hundred thousand dollars; (D) four thousand dollars for a project that 232
will cost greater than five hundred thousand dollars but not greater than 233
one million dollars; (E) five thousand dollars for a project that will cost 234
greater than one million dollars but not greater than five million dollars; 235
(F) eight thousand dollars for a project that will cost greater than five 236
million dollars but not greater than ten million dollars; and (G) ten 237
thousand dollars for a project that will cost greater than ten million 238
dollars. 239
(b) Prior to the filing of a certificate of need application, the applicant 240
shall (1) publish notice that an application is to be submitted to the unit 241
(A) in a newspaper having a substantial circulation in the area where 242
the project is to be located, and (B) on the applicant's Internet web site 243
in a clear and conspicuous location that is easily accessible by members 244
of the public, (2) request the publication of notice (A) in at least two sites 245
within the affected community that are commonly accessed by the 246
public, such as a town hall or library, and (B) on any existing Internet 247
web site of the municipality or local health department, and (3) submit 248
such notice to the unit for posting on such unit's Internet web site. Such 249
newspaper notice shall be published for not less than three consecutive 250
days, with the final date of consecutive publication occurring not later 251
than twenty days prior to the date of filing of the certificate of need 252
application, and contain a brief description of the nature of the project 253
and the street address where the project is to be located. Postings in the 254
affected community and on the applicant's Internet web site shall 255
remain until the decision on the application is rendered. The unit shall 256
not invalidate any notice due to changes or removal of the notice from 257
a community Internet web site of which the applicant has no control. An 258
applicant shall file the certificate of need application with the unit not 259 Raised Bill No. 440
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later than ninety days after publishing notice of the application in a 260
newspaper in accordance with the provisions of this subsection. The 261
unit shall not accept the applicant's certificate of need application for 262
filing unless the application is accompanied by the application fee 263
prescribed in subsection (a) of this section and proof of compliance with 264
the publication requirements prescribed in this subsection. Prior to 265
submitting the certificate of need application, the applicant may request 266
an informational meeting with the unit to discuss the requirements of 267
the application process. The unit shall hold such informational meeting 268
with the applicant not later than one week after the date it receives the 269
applicant's request for an informational meeting. 270
(c) (1) Not later than five business days after receipt of a properly filed 271
certificate of need application, the unit shall publish notice of the 272
application on its Internet web site. Not later than thirty days after the 273
date of filing of the application, the unit may request such additional 274
information as the unit determines necessary to complete the 275
application. In addition to any information requested by the unit, if the 276
application involves the transfer of ownership of a hospital, as defined 277
in section 19a-639, the applicant shall submit to the unit (A) a plan 278
demonstrating how health care services will be provided by the new 279
hospital for the first three years following the transfer of ownership of 280
the hospital, including any consolidation, reduction, elimination or 281
expansion of existing services or introduction of new services, and (B) 282
the names of persons currently holding a position with the hospital to 283
be purchased or the purchaser, as defined in section 19a-639, as an 284
officer, director, board member or senior manager, whether or not such 285
person is expected to hold a position with the hospital after completion 286
of the transfer of ownership of the hospital and any salary, severance, 287
stock offering or any financial gain, current or deferred, such person is 288
expected to receive as a result of, or in relation to, the transfer of 289
ownership of the hospital. 290
(2) The applicant shall, not later than sixty days after the date of the 291
unit's request, submit any requested information and any information 292
required under this subsection to the unit. If an applicant fails to submit 293 Raised Bill No. 440
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such information to the unit within the sixty-day period, the unit shall 294
consider the application to have been withdrawn. 295
(3) The unit shall make reasonable efforts to limit the requests for 296
additional information to two such requests and, in all cases, cease all 297
requests for additional information not later than six months after 298
receiving the application. 299
(d) Upon deeming an application complete, the unit shall provide 300
notice of this determination to the applicant and to the public in 301
accordance with regulations adopted by the department. In addition, 302
the unit shall post such notice on its Internet web site and notify the 303
applicant not later than five days after deeming the application 304
complete. The date on which the unit posts such notice on its Internet 305
web site shall begin the review period. Except as provided in this 306
subsection, (1) the review period for an application deemed complete 307
shall be [ninety] thirty days from the date on which the unit posts such 308
notice on its Internet web site; and (2) the unit shall issue a decision on 309
an application deemed complete prior to the expiration of the [ninety-310
day] thirty-day review period in matters without a public hearing. If the 311
unit does not issue a decision on an application deemed complete prior 312
to the expiration of the thirty-day review period in matters without a 313
public hearing, such application shall be deemed approved. The review 314
period for an application deemed complete that involves a transfer of a 315
large group practice, as described in subdivision (3) of subsection (a) of 316
section 19a-638, when the offer was made in response to a request for 317
proposal or similar voluntary offer for sale, shall be [sixty] twenty days 318
from the date on which the unit posts notice on its Internet web site. 319
Upon request or for good cause shown, the unit may extend the review 320
period for a period of time not to exceed [sixty] twenty days. If the 321
review period is extended, the unit shall issue a decision on the 322
completed application prior to the expiration of the extended review 323
period. If the unit holds a public hearing concerning a completed 324
application in accordance with subsection (e) or (f) of this section, the 325
unit shall issue a decision on the completed application not later than 326
[sixty] twenty days after the date the unit closes the public hearing 327 Raised Bill No. 440
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record. If the unit does not issue a decision on the completed 328
application, not later than twenty days after such date, the application 329
shall be deemed approved. 330
(e) Except as provided in this subsection, the unit shall hold a public 331
hearing on a properly filed and completed certificate of need application 332
if three or more individuals or an individual representing an entity with 333
five or more people submits a request, in writing, that a public hearing 334
be held on the application. For a properly filed and completed certificate 335
of need application involving a transfer of ownership of a large group 336
practice, as described in subdivision (3) of subsection (a) of section 19a-337
638, when an offer was made in response to a request for proposal or 338
similar voluntary offer for sale, a public hearing shall be held if twenty-339
five or more individuals or an individual representing twenty-five or 340
more people submits a request, in writing, that a public hearing be held 341
on the application. Any request for a public hearing shall be made to the 342
unit not later than [thirty] ten days after the date the unit deems the 343
application to be complete. 344
(f) (1) The unit shall hold a public hearing with respect to each 345
certificate of need application filed pursuant to section 19a-638, as 346
amended by this act, after December 1, 2015, that concerns any transfer 347
of ownership involving a hospital. Such hearing shall be held in the 348
municipality in which the hospital that is the subject of the application 349
is located. 350
(2) The unit may hold a public hearing with respect to any certificate 351
of need application submitted under this chapter. The unit shall provide 352
not less than [two weeks'] five days' advance notice to the applicant, in 353
writing, and to the public by publication in a newspaper having a 354
substantial circulation in the area served by the health care facility or 355
provider. In conducting its activities under this chapter, the unit may 356
hold hearings with respect to applications of a similar nature at the same 357
time. The applicant shall post a copy of the unit's hearing notice on the 358
applicant's Internet web site in a clear and conspicuous location that is 359
easily accessible by members of the public. Such applicant shall request 360 Raised Bill No. 440
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the publication of notice in at least two sites within the affected 361
community that are commonly accessed by the public, such as a town 362
hall or library, as well as on any existing Internet web site of the 363
municipality or local health department. The unit shall not invalidate 364
any notice due to changes or removal of the notice from a community 365
Internet web site of which the applicant has no control. 366
(g) An applicant may request an expedited timeline for determination 367
on a certificate of need application in a form and manner prescribed by 368
the unit. The unit shall develop a process for approving a request for an 369
expedited timeline. Notwithstanding the provisions of this section, if the 370
unit accepts a request for an expedited timeline, a determination shall 371
be made on the application not more than fourteen days after the date 372
the completed application is submitted to the unit. 373
[(g)] (h) (1) For applications submitted on or after October 1, 2023, the 374
unit may retain an independent consultant with expertise in the specific 375
area of health care that is the subject of the application filed by an 376
applicant if the review and analysis of an application cannot reasonably 377
be conducted by the unit without the expertise of an industry analyst or 378
other actuarial consultant. The unit shall submit bills for independent 379
consultant services to the applicant. Such applicant shall pay such bills 380
not later than thirty days after receipt of such bills. Such bills shall be a 381
reasonable amount per application. The provisions of chapter 57 and 382
sections 4-212 to 4-219, inclusive, and 4e-19 shall not apply to any 383
retainer agreement executed pursuant to this subsection. 384
(2) For applications submitted on or after October 1, 2024, the unit 385
may contract with independent consultants or other persons, as deemed 386
necessary by the executive director of the Office of Health Strategy, to 387
assist in reviewing and issuing decisions on applications submitted 388
pursuant to the provisions of this section. Not later than July 1, 2025, 389
and quarterly thereafter, the executive director of the Office of Health 390
Strategy shall post all costs incurred as a result of contracts entered into 391
pursuant to the provisions of this subdivision on the Office of Health 392
Strategy's Internet web site. 393 Raised Bill No. 440
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[(h)] (i) The executive director of the Office of Health Strategy may 394
implement policies and procedures necessary to administer the 395
provisions of this section while in the process of adopting such policies 396
and procedures as regulation, provided the executive director holds a 397
public hearing prior to implementing the policies and procedures and 398
posts notice of intent to adopt regulations on the office's Internet web 399
site and the eRegulations System not later than twenty days after the 400
date of implementation. Policies and procedures implemented pursuant 401
to this section shall be valid until the time final regulations are adopted. 402
Sec. 3. (Effective from passage) The executive director of the Office of 403
Health Strategy shall conduct a study regarding the certificate of need 404
process in the state. Such study shall include, but need not be limited to, 405
(1) an examination of the cost to health care systems resulting from 406
delays or inefficiencies in the certificate of need process, (2) not less than 407
three public hearings convened by the executive director that allow 408
providers, insurers, the public and other stakeholders to provide 409
testimony regarding the certificate of need process, and (3) the 410
development of recommendations to improve the certificate of need 411
process by reducing delays, streamlining administrative processes and 412
hiring trained, experienced staff in lieu of contracting with third-party 413
experts. Not later than January 1, 2025, the executive director shall 414
report, in accordance with section 11-4a of the general statutes, to the 415
joint standing committee of the General Assembly having cognizance of 416
matters relating to public health regarding the results of such study. 417
Sec. 4. Section 19a-639f of the general statutes is repealed and the 418
following is substituted in lieu thereof (Effective October 1, 2024): 419
(a) The [Health Systems Planning Unit of the Office of Health 420
Strategy] office of the Attorney General shall conduct a cost and market 421
impact review in each case where (1) an application for a certificate of 422
need filed pursuant to section 19a-638, as amended by this act, involves 423
the transfer of ownership of a hospital, as defined in section 19a-639, and 424
(2) the purchaser is a hospital, as defined in section 19a-490, whether 425
located within or outside the state, that had net patient revenue for fiscal 426 Raised Bill No. 440
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year 2013 in an amount greater than one billion five hundred million 427
dollars, or a hospital system, as defined in section 19a-486i, whether 428
located within or outside the state, that had net patient revenue for fiscal 429
year 2013 in an amount greater than one billion five hundred million 430
dollars or any person that is organized or operated for profit. 431
(b) Not later than twenty-one days after receipt of a properly filed 432
certificate of need application involving the transfer of ownership of a 433
hospital filed on or after December 1, 2015, as described in subsection 434
(a) of this section, the unit shall notify the office of the Attorney General 435
of the need for the cost and market impact review. The Attorney General 436
shall initiate such cost and market impact review by sending the 437
transacting parties a written notice that shall contain a description of the 438
basis for the cost and market impact review as well as a request for 439
information and documents. Not later than thirty days after receipt of 440
such notice, the transacting parties shall submit to the [unit] Attorney 441
General a written response. Such response shall include, but need not 442
be limited to, any information or documents requested by the [unit] 443
Attorney General concerning the transfer of ownership of the hospital. 444
The [unit] Attorney General shall have the powers with respect to the 445
cost and market impact review as provided in section 19a-633. 446
(c) The [unit] Attorney General shall keep confidential all nonpublic 447
information and documents obtained pursuant to this section and shall 448
not disclose the information or documents to any person without the 449
consent of the person that produced the information or documents, 450
except in a preliminary report or final report issued in accordance with 451
this section if the [unit] Attorney General believes that such disclosure 452
should be made in the public interest after taking into account any 453
privacy, trade secret or anti-competitive considerations. Such 454
information and documents shall not be deemed a public record, under 455
section 1-210, and shall be exempt from disclosure. 456
(d) The cost and market impact review conducted pursuant to this 457
section shall examine factors relating to the businesses and relative 458
market positions of the transacting parties as defined in subsection (d) 459 Raised Bill No. 440
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of section 19a-639 and may include, but need not be limited to: (1) The 460
transacting parties' size and market share within its primary service 461
area, by major service category and within its dispersed service areas; 462
(2) the transacting parties' prices for services, including the transacting 463
parties' relative prices compared to other health care providers for the 464
same services in the same market; (3) the transacting parties' health 465
status adjusted total medical expense, including the transacting parties' 466
health status adjusted total medical expense compared to that of similar 467
health care providers; (4) the quality of the services provided by the 468
transacting parties, including patient experience; (5) the transacting 469
parties' cost and cost trends in comparison to total health care 470
expenditures state wide; (6) the availability and accessibility of services 471
similar to those provided by each transacting party, or proposed to be 472
provided as a result of the transfer of ownership of a hospital within 473
each transacting party's primary service areas and dispersed service 474
areas; (7) the impact of the proposed transfer of ownership of the 475
hospital on competing options for the delivery of health care services 476
within each transacting party's primary service area and dispersed 477
service area including the impact on existing service providers; (8) the 478
methods used by the transacting parties to attract patient volume and to 479
recruit or acquire health care professionals or facilities; (9) the role of 480
each transacting party in serving at-risk, underserved and government 481
payer patient populations, including those with behavioral, substance 482
use disorder and mental health conditions, within each transacting 483
party's primary service area and dispersed service area; (10) the role of 484
each transacting party in providing low margin or negative margin 485
services within each transacting party's primary service area and 486
dispersed service area; (11) consumer concerns, including, but not 487
limited to, complaints or other allegations that a transacting party has 488
engaged in any unfair method of competition or any unfair or deceptive 489
act or practice; and (12) any other factors that the [unit] Attorney 490
General determines to be in the public interest. 491
(e) Not later than ninety days after the [unit] Attorney General 492
determines that there is substantial compliance with any request for 493 Raised Bill No. 440
LCO No. 2995 17 of 20
documents or information issued by the [unit] Attorney General in 494
accordance with this section, or a later date set by mutual agreement of 495
the unit and the transacting parties, the [unit] Attorney General shall 496
make factual findings and issue a preliminary report on the cost and 497
market impact review. Such preliminary report shall include, but shall 498
not be limited to, an indication as to whether a transacting party meets 499
the following criteria: (1) Currently has or, following the proposed 500
transfer of operations of the hospital, is likely to have a dominant market 501
share for the services the transacting party provides; and (2) (A) 502
currently charges or, following the proposed transfer of operations of 503
the hospital, is likely to charge prices for services that are materially 504
higher than the median prices charged by all other health care providers 505
for the same services in the same market, or (B) currently has or, 506
following the proposed transfer of operations of a hospital, is likely to 507
have a health status adjusted total medical expense that is materially 508
higher than the median total medical expense for all other health care 509
providers for the same service in the same market. 510
(f) The transacting parties that are the subject of the cost and market 511
impact review may respond in writing to the findings in the preliminary 512
report issued in accordance with subsection (e) of this section not later 513
than thirty days after the issuance of the preliminary report. Not later 514
than sixty days after the issuance of the preliminary report, the [unit] 515
Attorney General shall issue a final report of the cost and market impact 516
review. [The unit shall refer to the Attorney General any final report on 517
any proposed transfer of ownership that meets the criteria described in 518
subsection (e) of this section.] 519
(g) Nothing in this section shall prohibit a transfer of ownership of a 520
hospital, provided any such proposed transfer shall not be completed 521
(1) less than thirty days after the [unit] Attorney General has issued a 522
final report on a cost and market impact review, if such review is 523
required, or (2) while any action brought by the Attorney General 524
pursuant to subsection (h) of this section is pending and before a final 525
judgment on such action is issued by a court of competent jurisdiction. 526 Raised Bill No. 440
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(h) After the [unit refers a final report on a transfer of ownership of a 527
hospital to the Attorney General under subsection (f) of this section] 528
Attorney General has issued a final report on the cost and market impact 529
review, the Attorney General may: (1) Conduct an investigation to 530
determine whether the transacting parties engaged, or, as a result of 531
completing the transfer of ownership of the hospital, are expected to 532
engage in unfair methods of competition, anti-competitive behavior or 533
other conduct in violation of chapter 624 or 735a or any other state or 534
federal law; and (2) if appropriate, take action under chapter 624 or 735a 535
or any other state law to protect consumers in the health care market. 536
The [unit's] final cost and market impact review report may be evidence 537
in any such action. 538
(i) For the purposes of this section, the provisions of chapter 735a may 539
be directly enforced by the Attorney General. Nothing in this section 540
shall be construed to modify, impair or supersede the operation of any 541
state antitrust law or otherwise limit the authority of the Attorney 542
General to (1) take any action against a transacting party as authorized 543
by any law, or (2) protect consumers in the health care market under any 544
law. Notwithstanding subdivision (1) of subsection (a) of section 42-545
110c, the transacting parties shall be subject to chapter 735a. 546
(j) The [unit] Attorney General shall retain an independent consultant 547
with expertise on the economic analysis of the health care market and 548
health care costs and prices to conduct each cost and market impact 549
review, as described in this section. The transacting parties shall submit 550
three proposed independent consultants to the Attorney General, who 551
shall select one such independent consultant to conduct the cost and 552
market impact review. The [unit] Attorney General shall submit bills for 553
such services to the purchaser, as defined in subsection (d) of section 554
19a-639. Such purchaser shall pay such bills not later than thirty days 555
after receipt. Such bills shall not exceed two hundred thousand dollars 556
per application. The provisions of chapter 57, sections 4-212 to 4-219, 557
inclusive, and section 4e-19 shall not apply to any agreement executed 558
pursuant to this subsection. 559 Raised Bill No. 440
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(k) Any employee of the unit who [directly oversees or] assists in 560
conducting a cost and market impact review shall not take part in factual 561
deliberations or the issuance of a preliminary or final decision on the 562
certificate of need application concerning the transfer of ownership of a 563
hospital that is the subject of such cost and market impact review. 564
(l) The executive director of the Office of Health Strategy shall adopt 565
regulations, in accordance with the provisions of chapter 54, concerning 566
cost and market impact reviews and to administer the provisions of this 567
section. Such regulations shall include definitions of the following 568
terms: "Dispersed service area", "health status adjusted total medical 569
expense", "major service category", "relative prices", "total health care 570
spending" and "health care services". The executive director may 571
implement policies and procedures necessary to administer the 572
provisions of this section while in the process of adopting such policies 573
and procedures in regulation form, provided the executive director 574
publishes notice of intention to adopt the regulations on the office's 575
Internet web site and the eRegulations System not later than twenty 576
days after implementing such policies and procedures. Policies and 577
procedures implemented pursuant to this subsection shall be valid until 578
the time such regulations are effective. 579
Sec. 5. (NEW) (Effective October 1, 2024) On and after October 1, 2024, 580
an insurance company that invests in any institution, as defined in 581
section 19a-490 of the general statutes, shall not exercise operational 582
control, managerial control or decision-making authority relating to the 583
institution's delivery of health care services. 584
This act shall take effect as follows and shall amend the following
sections:
Section 1 October 1, 2024 19a-638
Sec. 2 October 1, 2024 19a-639a
Sec. 3 from passage New section
Sec. 4 October 1, 2024 19a-639f
Sec. 5 October 1, 2024 New section
Raised Bill No. 440
LCO No. 2995 20 of 20
Statement of Purpose:
To make various revisions to the certificate of need process.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]