COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.:1081S.01I Bill No.:SB 337 Subject:Certificate of Need; Department of Health and Senior Services; Health Care;
Hospitals
Type:Original Date:January 6, 2025Bill Summary:This proposal modifies provisions relating to certificates of need.
FISCAL SUMMARY
ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND AFFECTEDFY 2026FY 2027FY 2028General Revenue($143,198)($176,133)($180,536)Total Estimated Net
Effect on General
Revenue($143,198)($176,133)($180,536)
ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on Other State
Funds $0$0$0
Numbers within parentheses: () indicate costs or losses. L.R. No. 1081S.01I
Bill No. SB 337
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ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on All Federal
Funds $0$0$0
ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on FTE 000
☐ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any
of the three fiscal years after implementation of the act or at full implementation of the act.
☐ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of
the three fiscal years after implementation of the act or at full implementation of the act.
ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Local Government$0$0$0 L.R. No. 1081S.01I
Bill No. SB 337
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FISCAL ANALYSIS
ASSUMPTION
§§ 197.305, 197.315, 197.320 and 354.095 – Certificates of need
Officials from the Department of Health and Senior Services (DHSS) state § 197.305 of the
proposed legislation removes language requiring facilities to complete a CON application for
major medical equipment. Based on previous years, a baseline number of five (5) of these
applications required a MO Population data request. Each application was charged an average of
$122.50. Therefore, Bureau of Health Care Analysis and Data Dissemination (BHCADD) would
have an estimated $612.50 loss of revenue for each projected fiscal year. This was derived by the
following formula: 5 applications times $122.50 per population data request equals $612.50.
The loss in revenue can be absorbed by the BHCADD. The dollars generated from the work
go into a fund that are then used to cover the time the analyst spent fulfilling the data request.
The department anticipates being able to absorb these costs. However, until the FY 2025 budget
is final, the Department cannot identify specific funding sources.
Section 197.305 of the proposed legislation omits major medical equipment from the definition
of a new institutional health service and omits the construction of a new hospital from the
definition of a health care facility as defined in the repealed § 197.366(4). These omissions
would negate the requirement for a Certificate of Need for new, additional or replacement major
medical equipment and for construction of a new hospital. This would result in no oversight of
the development or offering major medical equipment or new hospitals within the state, and the
public would no longer have a voice for such developments. There would be no law to contain
health costs, prevent unnecessary duplication of services, or ensure services are based on a
community need.
DHSS generates an average of $117,380 of General Revenue from major medical equipment
applications. Using a 2.5 percent annual growth rate, the total fiscal impact projected to General
Revenue will be a reduction of equipment application fees of an estimated $100,262 ($117,380 +
2.5 percent * 10/12 months) for FY 2026; $123,322 for FY 2027; and $126,405 for FY 2028.
Between FY 2022 and FY 2024, six new CON hospital application fees were collected, totaling
$886,509 in general revenue: $0 in FY 2022; $127,133 in FY 2023; and $759,376 in FY 2024.
The Department collected one fee in the amount of $635,178 in FY 2024, which was out of the
ordinary and skews the averaging of annual fees; therefore, it was removed from the calculation.
Based on this, DHSS generates an average of $50,266 of General Revenue from major medical
equipment applications. Using a 2.5 percent annual growth rate, the total fiscal impact projected
to General Revenue will be a reduction of new hospital application fees of an estimated $42,936
($50,266 + 2.5 percent * 10/12 months) for FY 2026; $52,811 for FY 2027; and $54,131 for FY
2028. L.R. No. 1081S.01I
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Oversight does not have information to the contrary and therefore, Oversight will reflect the
estimates as provided by the DHSS.
Officials from the Department of Social Services assume the proposal will have no fiscal
impact on their organization. Oversight does not have any information to the contrary.
Therefore, Oversight will reflect a zero impact in the fiscal note for that agency.
Oversight only reflects the responses received from state agencies and political subdivisions;
however, hospitals and nursing homes were requested to respond to this proposed legislation but
did not. A general listing of political subdivisions included in Oversight’s database is available
upon request.
FISCAL IMPACT – State GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028GENERAL REVENUE FUNDLoss – DHSS (§ 197.305) Reduction in
CON application fees p. 3($143,198)($176,133)($180,536)
ESTIMATED NET EFFECT ON
THE GENERAL REVENUE FUND($143,198)($176,133)($180,536)
FISCAL IMPACT – Local GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028$0$0$0
FISCAL IMPACT – Small Business
DHSS states the elimination of the Certificate of Need (CON) review for major medical
equipment would reduce, by at least a small amount, the time it would take to make the purchase.
(§ 197.305)
FISCAL DESCRIPTION
This act repeals provisions of the certificate of need law relating to hospitals, excluding long-
term care beds in hospitals, and major medical equipment. (§ 197.305) L.R. No. 1081S.01I
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This legislation is not federally mandated, would not duplicate any other program and would not
require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Health and Senior Services
Department of Social Services
Julie MorffJessica HarrisDirectorAssistant DirectorJanuary 6, 2025January 6, 2025