Senate File 2255 S-5032 Amend Senate File 2255 as follows: 1 1. By striking everything after the enacting clause and 2 inserting: 3 < Section 1. Section 135.61, subsection 18, Code 2022, is 4 amended to read as follows: 5 18. “New institutional health service” or “changed 6 institutional health service” means any of the following: 7 a. (1) The construction, development , or other 8 establishment of a new institutional health facility other than 9 a nursing facility regardless of ownership if the building 10 or structure of the new institutional health facility has an 11 interior floor space of forty thousand square feet or more . 12 (2) The construction, development, or other establishment 13 of a nursing facility regardless of ownership. 14 b. Relocation of an institutional health a nursing facility. 15 c. Any capital expenditure, lease, or donation by or 16 on behalf of an institutional health a nursing facility in 17 excess of one million five hundred thousand dollars within a 18 twelve-month period. 19 d. A permanent change in the bed capacity, as determined by 20 the department, of an institutional health a nursing facility. 21 For purposes of this paragraph, a change is permanent if it is 22 intended to be effective for one year or more. 23 e. Any expenditure in excess of five hundred thousand 24 dollars by or on behalf of an institutional health a nursing 25 facility for health services which are or will be offered in 26 or through an institutional health a nursing facility at a 27 specific time but which were not offered on a regular basis in 28 or through that institutional health nursing facility within 29 the twelve-month period prior to that time. 30 f. The deletion of one or more health services, previously 31 offered on a regular basis by an institutional health a nursing 32 facility or health maintenance organization or the relocation 33 of one or more health services from one physical facility to 34 another. 35 -1- SF 2255.3452 (1) 89 pf/rh 1/ 11 #1.

g. Any acquisition by or on behalf of a health care provider 1 or a group of health care providers of any piece of replacement 2 equipment with a value in excess of one ten million five 3 hundred thousand dollars, whether acquired by purchase, lease, 4 or donation. 5 h. Any acquisition by or on behalf of a health care provider 6 or group of health care providers of any piece of equipment 7 with a value in excess of one ten million five hundred thousand 8 dollars, whether acquired by purchase, lease, or donation, 9 which results in the offering or development of a health 10 service not previously provided. A mobile service provided 11 on a contract basis is not considered to have been previously 12 provided by a health care provider or group of health care 13 providers. 14 i. (1) Any acquisition by or on behalf of an institutional 15 health facility , other than a nursing facility, or a health 16 maintenance organization of any piece of replacement equipment 17 with a value in excess of one ten million five hundred thousand 18 dollars, whether acquired by purchase, lease, or donation. 19 (2) Any acquisition by or on behalf of a nursing facility of 20 any piece of replacement equipment with a value in excess of 21 one million five hundred thousand dollars, whether acquired by 22 purchase, lease, or donation. 23 j. (1) Any acquisition by or on behalf of an institutional 24 health facility , other than a nursing facility, or health 25 maintenance organization of any piece of equipment with a value 26 in excess of one ten million five hundred thousand dollars, 27 whether acquired by purchase, lease, or donation, which 28 results in the offering or development of a health service not 29 previously provided. A mobile service provided on a contract 30 basis is not considered to have been previously provided by an 31 institutional health facility. 32 (2) Any acquisition by or on behalf of a nursing facility 33 of any piece of equipment with a value in excess of one 34 million five hundred thousand dollars, whether acquired by 35 -2- SF 2255.3452 (1) 89 pf/rh 2/ 11

purchase, lease, or donation, which results in the offering or 1 development of a health service not previously provided. 2 k. Any air transportation service for transportation of 3 patients or medical personnel in excess of ten million dollars 4 offered through an institutional health facility at a specific 5 time but which was not offered on a regular basis in or through 6 that institutional health facility within the twelve-month 7 period prior to the specific time. 8 l. Any mobile health service with a value in excess of one 9 ten million five hundred thousand dollars. 10 m. Any of the following with a value in excess of ten 11 million dollars : 12 (1) Cardiac catheterization service. 13 (2) Open heart surgical service. 14 (3) Organ transplantation service. 15 (4) Radiation therapy service applying ionizing radiation 16 for the treatment of malignant disease using megavoltage 17 external beam equipment. 18 Sec. 2. Section 135.61, Code 2022, is amended by adding the 19 following new subsection: 20 NEW SUBSECTION . 18A. “Nursing facility” means the same as 21 defined in section 135C.1. 22 Sec. 3. Section 135.63, Code 2022, is amended to read as 23 follows: 24 135.63 Certificate of need required —— exclusions. 25 1. A new institutional health service or changed 26 institutional health service shall not be offered or developed 27 in this state without prior application to the department 28 for and receipt of a certificate of need, pursuant to 29 this subchapter . The application shall be made upon forms 30 furnished or prescribed by the department and shall contain 31 such information as the department may require under this 32 subchapter . The application shall be accompanied by a fee 33 equivalent to three-tenths of one percent of the anticipated 34 cost of the project with a minimum fee of six hundred dollars 35 -3- SF 2255.3452 (1) 89 pf/rh 3/ 11

and a maximum fee of twenty-one thousand dollars. The fee 1 shall be remitted by the department to the treasurer of 2 state, who shall place it in the general fund of the state. 3 If an application is voluntarily withdrawn within thirty 4 calendar days after submission, seventy-five percent of the 5 application fee shall be refunded; if the application is 6 voluntarily withdrawn more than thirty but within sixty days 7 after submission, fifty percent of the application fee shall 8 be refunded; if the application is withdrawn voluntarily more 9 than sixty days after submission, twenty-five percent of 10 the application fee shall be refunded. Notwithstanding the 11 required payment of an application fee under this subsection , 12 an applicant for a new institutional health service or a 13 changed institutional health service offered or developed by 14 an intermediate care facility for persons with an intellectual 15 disability or an intermediate care facility for persons with 16 mental illness as defined pursuant to section 135C.1 is exempt 17 from payment of the application fee. 18 2. This subchapter shall not be construed to augment, limit, 19 contravene, or repeal in any manner any other statute of this 20 state which may authorize or relate to licensure, regulation, 21 supervision, or control of, nor to be applicable to: 22 a. Private offices and private clinics of an individual 23 physician, dentist, or other practitioner or group of 24 health care providers, except as provided by section 135.61, 25 subsection 18 , paragraphs “g” , “h” , and “m” , and section 135.61, 26 subsections 20 and 21 . 27 b. Dispensaries and first aid stations, located within 28 schools, businesses, or industrial establishments, which are 29 maintained solely for the use of students or employees of those 30 establishments and which do not contain inpatient or resident 31 beds that are customarily occupied by the same individual for 32 more than twenty-four consecutive hours. 33 c. Establishments such as motels, hotels, and boarding 34 houses which provide medical, nursing personnel, and other 35 -4- SF 2255.3452 (1) 89 pf/rh 4/ 11

health related services as an incident to their primary 1 business or function. 2 d. a. The remedial care or treatment of residents or 3 patients in any home or institution conducted only for those 4 who rely solely upon treatment by prayer or spiritual means in 5 accordance with the creed or tenets of any recognized church or 6 religious denomination. 7 e. A health maintenance organization or combination of 8 health maintenance organizations or an institutional health 9 facility controlled directly or indirectly by a health 10 maintenance organization or combination of health maintenance 11 organizations, except when the health maintenance organization 12 or combination of health maintenance organizations does any of 13 the following: 14 (1) Constructs, develops, renovates, relocates, or 15 otherwise establishes an institutional health facility. 16 (2) Acquires major medical equipment as provided by section 17 135.61, subsection 18 , paragraphs “i” and “j” . 18 f. b. A residential care facility, as defined in section 19 135C.1 , including a residential care facility for persons with 20 an intellectual disability, notwithstanding any provision in 21 this subchapter to the contrary. 22 g. (1) c. A reduction in bed capacity of an institutional 23 health facility, notwithstanding any provision in this 24 subchapter to the contrary, if all of the following conditions 25 exist: 26 (a) (1) The institutional health facility reports to 27 the department the number and type of beds reduced on a form 28 prescribed by the department at least thirty days before the 29 reduction. In the case of a health care facility, the new bed 30 total must be consistent with the number of licensed beds at 31 the facility. In the case of a hospital, the number of beds 32 must be consistent with bed totals reported to the department 33 of inspections and appeals for purposes of licensure and 34 certification. 35 -5- SF 2255.3452 (1) 89 pf/rh 5/ 11

(b) (2) The institutional health facility reports the new 1 bed total on its next annual report to the department. 2 (2) If these conditions are not met, the institutional 3 health facility is subject to review as a “new institutional 4 health service” or “changed institutional health service” under 5 section 135.61, subsection 18 , paragraph “d” , and subject to 6 sanctions under section 135.73 . If the institutional health 7 facility reestablishes the deleted beds at a later time, 8 review as a “new institutional health service” or “changed 9 institutional health service” is required pursuant to section 10 135.61, subsection 18 , paragraph “d” . 11 h. (1) d. The deletion of one or more health services, 12 previously offered on a regular basis by an institutional 13 health facility or health maintenance organization, 14 notwithstanding any provision of this subchapter to the 15 contrary, if all of the following conditions exist: 16 (a) (1) The institutional health facility or health 17 maintenance organization reports to the department the deletion 18 of the service or services at least thirty days before the 19 deletion on a form prescribed by the department. 20 (b) (2) The institutional health facility or health 21 maintenance organization reports the deletion of the service or 22 services on its next annual report to the department. 23 (2) If these conditions are not met, the institutional 24 health facility or health maintenance organization is subject 25 to review as a “new institutional health service” or “changed 26 institutional health service” under section 135.61, subsection 27 18 , paragraph “f” , and subject to sanctions under section 28 135.73 . 29 (3) If the institutional health facility or health 30 maintenance organization reestablishes the deleted service 31 or services at a later time, review as a “new institutional 32 health service” or “changed institutional health service” may 33 be required pursuant to section 135.61, subsection 18 . 34 i. e. A residential program exempt from licensing as a 35 -6- SF 2255.3452 (1) 89 pf/rh 6/ 11

health care facility under chapter 135C in accordance with 1 section 135C.6, subsection 8 . 2 j. f. The construction, modification, or replacement 3 of nonpatient care services, including parking facilities, 4 heating, ventilation and air conditioning systems, computers, 5 telephone systems, medical office buildings, and other projects 6 of a similar nature, notwithstanding any provision in this 7 subchapter to the contrary. 8 k. (1) g. The redistribution of beds by a hospital within 9 the acute care category of bed usage, notwithstanding any 10 provision in this subchapter to the contrary, if all of the 11 following conditions exist: 12 (a) (1) The hospital reports to the department the number 13 and type of beds to be redistributed on a form prescribed by 14 the department at least thirty days before the redistribution. 15 (b) (2) The hospital reports the new distribution of beds 16 on its next annual report to the department. 17 (2) If these conditions are not met, the redistribution 18 of beds by the hospital is subject to review as a new 19 institutional health service or changed institutional health 20 service pursuant to section 135.61, subsection 18 , paragraph 21 “d” , and is subject to sanctions under section 135.73 . 22 l. h. The replacement or modernization of any institutional 23 health facility if the replacement or modernization does 24 not add new health services or additional bed capacity for 25 existing health services, notwithstanding any provision in 26 this subchapter to the contrary. With respect to a nursing 27 facility, “replacement” means establishing a new facility within 28 the same county as the prior facility to be closed. With 29 reference to a hospital, “replacement” means establishing a new 30 hospital that demonstrates compliance with all of the following 31 criteria through evidence submitted to the department: 32 (1) Is designated as a critical access hospital pursuant to 33 42 U.S.C. §1395i-4. 34 (2) Serves at least seventy-five percent of the same service 35 -7- SF 2255.3452 (1) 89 pf/rh 7/ 11

area that was served by the prior hospital to be closed and 1 replaced by the new hospital. 2 (3) Provides at least seventy-five percent of the same 3 services that were provided by the prior hospital to be closed 4 and replaced by the new hospital. 5 (4) Is staffed by at least seventy-five percent of the 6 same staff, including medical staff, contracted staff, and 7 employees, as constituted the staff of the prior hospital to be 8 closed and replaced by the new hospital. 9 m. i. Hemodialysis services provided by a hospital or 10 freestanding facility, notwithstanding any provision in this 11 subchapter to the contrary. 12 n. j. Hospice services provided by a hospital, 13 notwithstanding any provision in this subchapter to the 14 contrary. 15 o. k. The change in ownership, licensure, organizational 16 structure, or designation of the type of institutional health 17 facility if the health services offered by the successor 18 institutional health facility are unchanged. This exclusion 19 is applicable only if the institutional health facility 20 consents to the change in ownership, licensure, organizational 21 structure, or designation of the type of institutional health 22 facility and ceases offering the health services simultaneously 23 with the initiation of the offering of health services by the 24 successor institutional health facility. 25 p. l. The conversion of an existing number of beds by an 26 intermediate care facility for persons with an intellectual 27 disability to a smaller facility environment, including but not 28 limited to a community-based environment which does not result 29 in an increased number of beds, notwithstanding any provision 30 in this subchapter to the contrary, including subsection 4 , if 31 all of the following conditions exist: 32 (1) The intermediate care facility for persons with an 33 intellectual disability reports the number and type of beds to 34 be converted on a form prescribed by the department at least 35 -8- SF 2255.3452 (1) 89 pf/rh 8/ 11

thirty days before the conversion. 1 (2) The intermediate care facility for persons with an 2 intellectual disability reports the conversion of beds on its 3 next annual report to the department. 4 3. This subchapter shall not be construed to be applicable 5 to a health care facility operated by and for the exclusive use 6 of members of a religious order, which does not admit more than 7 two individuals to the facility from the general public, and 8 which was in operation prior to July 1, 1986. However, this 9 subchapter is applicable to such a facility if the facility 10 is involved in the offering or developing of a new or changed 11 institutional health service on or after July 1, 1986. 12 4. 3. A copy of the application shall be sent to the 13 department of human services at the time the application is 14 submitted to the Iowa department of public health. 15 4. The department shall not process applications for and 16 the council shall not consider a new or changed institutional 17 health service for an intermediate care facility for persons 18 with an intellectual disability unless both of the following 19 conditions are met: 20 a. The new or changed beds shall not result in an 21 increase in the total number of medical assistance certified 22 intermediate care facility beds for persons with an 23 intellectual disability in the state, exclusive of those beds 24 at the state resource centers or other state institutions, 25 beyond one thousand six hundred thirty-six beds. 26 b. A letter of support for the application is provided by 27 the county board of supervisors, or the board’s designee, in 28 the county in which the beds would be located. 29 Sec. 4. Section 135.64, subsection 2, Code 2022, is amended 30 to read as follows: 31 2. In addition to the findings required with respect to 32 any of the criteria listed in subsection 1 of this section , 33 the council shall grant a certificate of need for a new 34 institutional health service or changed institutional health 35 -9- SF 2255.3452 (1) 89 pf/rh 9/ 11

service only if it finds in writing, on the basis of data 1 submitted to it by the department, that all of the following 2 conditions are met : 3 a. Less costly, more efficient, or more appropriate 4 alternatives to the proposed institutional health service are 5 not available and the development of such alternatives is not 6 practicable ; . 7 b. Any existing facilities providing institutional health 8 services similar to those proposed are being used in an 9 appropriate and efficient manner ; . 10 c. In the case of new construction, alternatives including 11 but not limited to modernization or sharing arrangements have 12 been considered and have been implemented to the maximum extent 13 practicable ; . 14 d. Patients will experience serious problems in obtaining 15 care of the type which will be furnished by the proposed new 16 institutional health service or changed institutional health 17 service, in the absence of that proposed new service. 18 Sec. 5. Section 135.67, subsection 1, Code 2022, is amended 19 to read as follows: 20 1. The department may waive the letter of intent procedures 21 prescribed by section 135.65 and substitute a summary 22 review procedure, which shall be established by rules of the 23 department, when it accepts an application for a certificate 24 of need for a project which meets any of the criteria in 25 paragraphs “a” through “e” : 26 a. A project which is limited to repair or replacement of a 27 facility or equipment damaged or destroyed by a disaster, and 28 which will not expand the facility nor increase the services 29 provided beyond the level existing prior to the disaster. 30 b. A project necessary to enable the facility or service to 31 achieve or maintain compliance with federal, state, or other 32 appropriate licensing, certification, or safety requirements. 33 c. A project which will not change the existing bed capacity 34 of the nursing facility applicant’s facility or service, as 35 -10- SF 2255.3452 (1) 89 pf/rh 10/ 11

determined by the department, by more than ten percent or ten 1 beds, whichever is less, over a two-year period. 2 d. A nursing facility project the total cost of which will 3 not exceed one hundred fifty thousand dollars. 4 e. Any other project for which the applicant proposes and 5 the department agrees to summary review. 6 Sec. 6. Section 135B.5A, Code 2022, is amended to read as 7 follows: 8 135B.5A Conversion of a hospital. 9 A conversion of a long-term acute care hospital, 10 rehabilitation hospital, or psychiatric hospital as defined by 11 federal regulations to a general hospital or to a specialty 12 hospital of a different type is a permanent change in bed 13 capacity and that results in a building or structure with a 14 floor space of forty thousand square feet or more shall require 15 a certificate of need pursuant to section 135.63 . 16 Sec. 7. Section 135H.6, subsection 1, paragraph d, Code 17 2022, is amended to read as follows: 18 d. The applicant has been awarded a certificate of need , if 19 applicable pursuant to chapter 135 , unless exempt as provided 20 in this section . 21 Sec. 8. ADMINISTRATIVE RULES. The department of public 22 health, in accordance with section 135.72, may adopt rules 23 pursuant to chapter 17A to administer this Act. > 24 2. Title page, by striking lines 1 and 2 and inserting < An 25 Act relating to the certificate of need process. > 26 ______________________________ JEFF EDLER -11- SF 2255.3452 (1) 89 pf/rh 11/ 11 #2.