House File 2635 H-8080 Amend House File 2635 as follows: 1 1. By striking everything after the enacting clause and 2 inserting: 3 < DIVISION I 4 HEALTH INSURANCE TRADE PRACTICES 5 Section 1. Section 514F.8, Code 2026, is amended by adding 6 the following new subsection: 7 NEW SUBSECTION . 2A. A utilization review organization may 8 use an artificial intelligence-based algorithm or system to 9 provide an initial review of a request for prior authorization, 10 except that, for a prior authorization request for a health 11 care service based on medical necessity, a utilization review 12 organization shall not use an artificial intelligence-based 13 algorithm or system as the sole basis for the utilization 14 review organization’s decision to deny, delay, or downgrade the 15 prior authorization request. 16 Sec. 2. NEW SECTION . 514F.8C Utilization review 17 organizations —— audits. 18 1. As used in this section, unless the context otherwise 19 requires: 20 a. “Audit” means a review, investigation, or request for 21 additional documentation by a utilization review organization 22 before or after issuing payment on a claim to a health care 23 provider. 24 b. “Commissioner” means the commissioner of insurance. 25 c. “Health care provider” means the same as defined in 26 section 514F.8. 27 d. “Health carrier” means the same as defined in Section 28 514F.8. 29 e. “Utilization review organization” means the same as 30 defined in section 514F.8. 31 2. a. A utilization review organization that conducts an 32 audit shall notify the health care provider that submitted 33 the claim of the initiation of the audit no later than 34 fifteen calendar days after the date the utilization review 35 -1- HF 2635.3065 (1) 91 nls/ko 1/ 22 #1.

organization selects the claim for audit. 1 b. A utilization review organization shall complete an audit 2 of a claim and issue a determination on the claim to the health 3 care provider that submitted the claim no later than forty-five 4 calendar days after the date that the utilization review 5 organization receives all requested documentation regarding the 6 claim from the health care provider. 7 c. A health care provider that submitted a claim that is 8 the subject of an audit by a utilization review organization 9 that receives an adverse determination regarding the claim may 10 appeal the adverse determination no later than thirty calendar 11 days after the date the health care provider receives the audit 12 determination. 13 d. A utilization review organization shall consider an 14 appeal under paragraph “c” and issue a final determination 15 on the claim that is the subject of the appeal no later than 16 thirty calendar days after the date the utilization review 17 organization receives notice of the appeal. 18 e. If, after a hearing, the commissioner finds that a 19 utilization review organization has violated this subsection, 20 the claim shall be approved by the utilization review 21 organization and promptly paid, including interest at the rate 22 of ten percent per annum. 23 3. a. This section applies to the following classes of 24 third-party payment provider contracts, policies, or plans 25 delivered, issued for delivery, continued, or renewed in this 26 state on or after January 1, 2027: 27 (1) Individual or group accident and sickness insurance 28 providing coverage on an expense-incurred basis. 29 (2) An individual or group hospital or medical service 30 contract issued pursuant to chapter 509, 514, or 514A. 31 (3) An individual or group health maintenance organization 32 contract regulated under chapter 514B. 33 (4) A plan established for public employees pursuant to 34 chapter 509A. 35 -2- HF 2635.3065 (1) 91 nls/ko 2/ 22

b. This section shall not apply to accident-only, specified 1 disease, short-term hospital or medical, hospital confinement 2 indemnity, credit, dental, vision, Medicare supplement, 3 long-term care, basic hospital and medical-surgical expense 4 coverage as defined by the commissioner of insurance, 5 disability income insurance coverage, coverage issued as a 6 supplement to liability insurance, workers’ compensation or 7 similar insurance, or automobile medical payment insurance. 8 4. The commissioner may adopt rules pursuant to chapter 17A 9 to administer and enforce this section. 10 5. a. This section shall apply to an audit initiated on or 11 after January 1, 2027. 12 b. This section shall not apply to a claim that is under 13 active fraud investigation by a state or federal authority. 14 c. This section shall not apply to a federal program where 15 audits are mandated by federal law. 16 Sec. 3. NEW SECTION . 514F.8D Health carriers —— standards 17 of conduct. 18 1. As used in this section, unless the context otherwise 19 requires: 20 a. “Health care provider” means the same as defined in 21 section 514J.102. 22 b. “Health carrier” means the same as defined in section 23 514F.8. 24 2. A health carrier shall not impose on a health care 25 provider, directly or indirectly, any financial penalty, 26 reimbursement reduction, or administrative fee, or terminate a 27 health care provider’s participation in the health carrier’s 28 network, based on the health care provider’s referral to, or 29 affiliation with, an out-of-network health care provider. 30 3. A health carrier shall not interfere with, or participate 31 in any capacity in, a health care provider’s decisions 32 regarding staffing and referrals, except as otherwise provided 33 by law. 34 4. A health carrier shall not offer, attempt to enforce, 35 -3- HF 2635.3065 (1) 91 nls/ko 3/ 22

or enforce an agreement, or an amendment to an agreement, with 1 a health care provider without providing an opportunity for 2 negotiation. A decision of the commissioner enforcing this 3 subsection is final agency action for purposes of chapter 17A. 4 5. The commissioner may adopt rules pursuant to chapter 17A 5 to administer and enforce this section. 6 DIVISION II 7 PRIOR AUTHORIZATIONS 8 Sec. 4. NEW SECTION . 514F.8A Prior authorizations —— peer 9 review. 10 1. For purposes of this section, unless the context 11 otherwise requires: 12 a. “Clinical peer” means a health care professional that 13 meets all of the following requirements: 14 (1) The health care professional practices in the same or 15 similar specialty as the health care provider that requested 16 a prior authorization. 17 (2) The health care professional has experience managing 18 the specific medical condition or administering the health care 19 service that is the subject of the prior authorization request. 20 (3) The health care professional is employed by or 21 contracted with the utilization review organization or health 22 carrier to which a health care provider submitted a request for 23 prior authorization. 24 b. “Covered person” means the same as defined in section 25 514F.8. 26 c. “Downgrade” means a decision by a utilization review 27 organization to change an expedited or urgent request for prior 28 authorization to a standard determination, or otherwise modify 29 a health care service that is the subject of a request for 30 prior authorization to a lower-level health care service. 31 d. “Health care professional” means the same as defined in 32 section 514J.102. 33 e. “Health care provider” means the same as defined in 34 section 514F.8. 35 -4- HF 2635.3065 (1) 91 nls/ko 4/ 22

f. “Health care services” means the same as defined in 1 section 514F.8. 2 g. “Health carrier” means the same as defined in section 3 514F.8. 4 h. “Physician” means a doctor of medicine and surgery, or 5 a doctor of osteopathic medicine and surgery, licensed under 6 chapter 148. 7 i. “Prior authorization” means the same as defined in 8 section 514F.8. 9 j. “Qualified reviewer” means a physician that meets all of 10 the following requirements: 11 (1) The physician practices in the same or a similar 12 specialty as the health care provider that requested a prior 13 authorization. 14 (2) The physician has the training and expertise to treat 15 the specific medical condition that is the subject of a 16 request for prior authorization, including sufficient knowledge 17 to determine whether the health care service that is the 18 subject of the request is medically necessary or clinically 19 appropriate. 20 (3) The physician is employed by or contracted with the 21 utilization review organization to which a health care provider 22 submitted a request for prior authorization. 23 k. “Utilization review organization” means the same as 24 defined in section 514F.8. 25 2. A utilization review organization shall not deny or 26 downgrade a request for prior authorization unless all of the 27 following requirements are met: 28 a. The decision to deny or downgrade the request is made by 29 either of the following: 30 (1) A qualified reviewer, if the health care provider 31 requesting prior authorization is a physician. 32 (2) A clinical peer, if the health care provider requesting 33 prior authorization is not a physician. 34 b. The utilization review organization provides the health 35 -5- HF 2635.3065 (1) 91 nls/ko 5/ 22

care provider that requested the prior authorization all of the 1 following: 2 (1) A written statement that cites the specific reasons 3 for the denial or downgrade, including any coverage criteria 4 or limits, or clinical criteria, that the utilization review 5 organization considered or that was the basis for the denial 6 or downgrade. The written statement must be signed by either 7 of the following: 8 (a) The qualified reviewer that made the denial or downgrade 9 determination if the health care provider that requested prior 10 authorization is a physician. 11 (b) The clinical peer that made the denial or downgrade 12 determination if the health care provider that requested prior 13 authorization is not a physician. 14 (2) A written explanation of the utilization review 15 organization’s appeals process. The utilization review 16 organization shall also provide the written explanation to the 17 covered person for whom prior authorization was requested. 18 (3) A written attestation that is either of the following: 19 (a) If the health care provider that requested prior 20 authorization is a physician, a written attestation that 21 the qualified reviewer who made the denial or downgrade 22 determination practices in the same or a similar specialty as 23 the health care provider, and has the requisite training and 24 expertise to treat the medical condition that is the subject 25 of the request for prior authorization, including sufficient 26 knowledge to determine whether the health care service is 27 medically necessary or clinically appropriate. The attestation 28 shall include the qualified reviewer’s name, national provider 29 identifier, state medical license number, board certifications, 30 specialty expertise, and educational background. 31 (b) If the health care provider that requested prior 32 authorization is not a physician, a written attestation 33 that the clinical peer who made the denial or downgrade 34 determination practices in the same or a similar specialty as 35 -6- HF 2635.3065 (1) 91 nls/ko 6/ 22

the health care provider, and the clinical peer has experience 1 managing the specific medical condition or administering 2 the health care service that is the subject of the request 3 for prior authorization. The attestation shall include the 4 clinical peer’s name, national provider identifier, state 5 medical license number, board certifications, specialty 6 expertise, and educational background. 7 3. At the request of the requesting health care provider, a 8 utilization review organization that denies a request for prior 9 authorization shall, no later than seven business days after 10 the date that the utilization review organization notifies 11 the requesting health care provider of the denial, conduct a 12 consultation either in person or remotely, as follows: 13 a. Between the health care provider and a qualified reviewer 14 if the health care provider requesting prior authorization is a 15 physician. 16 b. Between the health care provider and a clinical peer if 17 the health care provider requesting prior authorization is not 18 a physician. 19 4. a. If a utilization review organization’s decision to 20 deny or downgrade a request for prior authorization is appealed 21 by the requesting health care provider or covered person, the 22 appeal shall be conducted by either of the following: 23 (1) A qualified reviewer if the health care provider 24 requesting prior authorization is a physician. 25 (2) A clinical peer if the health care provider requesting 26 prior authorization is not a physician. 27 b. A qualified reviewer or clinical peer involved in the 28 initial denial or downgrade determination of a request for 29 prior authorization that is the subject of an appeal shall not 30 conduct the appeal. 31 c. When conducting an appeal of a request for prior 32 authorization, the qualified reviewer or clinical peer shall 33 consider the known clinical aspects of the health care services 34 under review, including but not limited to medical records 35 -7- HF 2635.3065 (1) 91 nls/ko 7/ 22

relevant to the covered person’s medical condition who is 1 the subject of the health care services for which prior 2 authorization is requested, and any relevant medical literature 3 submitted by the health care provider as part of the appeal. 4 5. This section applies to requests for prior authorization 5 made on or after January 1, 2027. 6 6. a. This section applies to the following classes of 7 third-party payment provider contracts, policies, or plans 8 delivered, issued for delivery, continued, or renewed in this 9 state on or after January 1, 2027: 10 (1) Individual or group accident and sickness insurance 11 providing coverage on an expense-incurred basis. 12 (2) An individual or group hospital or medical service 13 contract issued pursuant to chapter 509, 514, or 514A. 14 (3) An individual or group health maintenance organization 15 contract regulated under chapter 514B. 16 (4) A plan established for public employees pursuant to 17 chapter 509A. 18 b. This section shall not apply to accident-only, specified 19 disease, short-term hospital or medical, hospital confinement 20 indemnity, credit, dental, vision, Medicare supplement, 21 long-term care, basic hospital and medical-surgical expense 22 coverage as defined by the commissioner of insurance, 23 disability income insurance coverage, coverage issued as a 24 supplement to liability insurance, workers’ compensation or 25 similar insurance, or automobile medical payment insurance. 26 7. The commissioner of insurance may adopt rules pursuant to 27 chapter 17A to administer this section. 28 Sec. 5. NEW SECTION . 514F.8B Prior authorizations —— 29 exemptions. 30 1. For purposes of this section: 31 a. “Covered person” means the same as defined in section 32 514F.8. 33 b. “Health benefit plan” means the same as defined in 34 section 514J.102. 35 -8- HF 2635.3065 (1) 91 nls/ko 8/ 22

c. “Health care professional” means the same as defined in 1 section 514J.102. 2 d. “Health carrier” means the same as defined in section 3 514F.8. 4 e. “Prior authorization” means the same as defined in 5 section 514F.8. 6 f. “Utilization review” means the same as defined in section 7 514F.4, subsection 3. 8 2. A health carrier shall not require prior authorization 9 for, or impose additional utilization review requirements on, a 10 covered person for any of the following: 11 a. A cancer-related screening if the cancer-related 12 screening is recommended by the covered person’s health care 13 professional based on the most recently updated national 14 comprehensive cancer network clinical practice guidelines in 15 oncology which are designated as category 2A or lower. 16 b. Diagnosis and treatment of an emergency medical condition 17 that develops or becomes evident in a covered person while 18 the covered person is receiving inpatient care that meets 19 inpatient care standards, if the emergency medical condition 20 is reasonably determined by a health care professional to be a 21 life-threatening condition unless the covered person receives 22 immediate assessment and treatment. 23 3. This section applies to all of the following: 24 a. Health benefit plans delivered, issued for delivery, 25 continued, or renewed in this state on or after January 1, 26 2027. 27 b. Requests for prior authorization for a cancer-related 28 screening, if the screening is recommended by the covered 29 person’s health care professional based on the most recently 30 updated national comprehensive cancer network clinical practice 31 guidelines in oncology designated as category 2A or lower, and 32 is made on or after January 1, 2027. 33 c. Requests for prior authorization for the diagnosis and 34 treatment of an emergency medical condition that develops or 35 -9- HF 2635.3065 (1) 91 nls/ko 9/ 22

becomes evident in a covered person while the covered person is 1 receiving inpatient care that meets inpatient care standards, 2 if the emergency medical condition is reasonably determined by 3 a health care professional to be a life-threatening condition 4 unless the covered person receives immediate assessment and 5 treatment if the request is made on or after January 1, 2027. 6 4. a. This section applies to the following classes of 7 third-party payment provider contracts, policies, or plans 8 delivered, issued for delivery, continued, or renewed in this 9 state on or after January 1, 2027: 10 (1) Individual or group accident and sickness insurance 11 providing coverage on an expense-incurred basis. 12 (2) An individual or group hospital or medical service 13 contract issued pursuant to chapter 509, 514, or 514A. 14 (3) An individual or group health maintenance organization 15 contract regulated under chapter 514B. 16 (4) A plan established for public employees pursuant to 17 chapter 509A. 18 b. This section shall not apply to accident-only, specified 19 disease, short-term hospital or medical, hospital confinement 20 indemnity, credit, dental, vision, Medicare supplement, 21 long-term care, basic hospital and medical-surgical expense 22 coverage as defined by the commissioner of insurance, 23 disability income insurance coverage, coverage issued as a 24 supplement to liability insurance, workers’ compensation or 25 similar insurance, or automobile medical payment insurance. 26 5. The commissioner of insurance may adopt rules pursuant to 27 chapter 17A to administer this section. 28 Sec. 6. NEW SECTION . 514F.8E Enforcement. 29 The remedy for noncompliance with section 514F.8, 514F.8A, 30 514F.8B, 514F.8C, or 514F.8D shall be those remedies authorized 31 by chapters 505 and 507B pursuant to the procedures set forth 32 in sections 507B.6, 507B.7, and 507B.8. Upon a finding of 33 a pattern or practice of noncompliance with sections 514F.8, 34 514F.8A, 514F.8B, 514F.8C, or 514F.8D, the commissioner of 35 -10- HF 2635.3065 (1) 91 nls/ko 10/ 22

insurance may also suspend a utilization review organization’s 1 authority to conduct utilization review. 2 DIVISION III 3 PRIOR AUTHORIZATIONS —— MEDICAL ASSISTANCE PROGRAM 4 Sec. 7. NEW SECTION . 249A.5 Prior authorization —— 5 exemptions. 6 1. For purposes of this section, unless the context 7 otherwise requires: 8 a. “Emergency medical condition” means the same as defined 9 in 42 C.F.R. §438.114. 10 b. “Managed care organization” means an entity acting 11 pursuant to a contract with the department to administer the 12 medical assistance program. 13 c. “Prior authorization” means any process used by the 14 department or a managed care organization to determine if, 15 before a health care service is furnished to a recipient, the 16 service is covered or medically necessary. 17 d. “Utilization review” means a set of formal techniques 18 used to monitor or evaluate the medical necessity, 19 appropriateness, or efficiency of a health care service. 20 2. The department, or a managed care organization, shall 21 not require prior authorization for, or impose additional 22 utilization review requirements on, a recipient for any of the 23 following: 24 a. A cancer-related screening recommended for the recipient 25 by the recipient’s provider in accordance with the most 26 recently updated national comprehensive cancer network clinical 27 practice guidelines in oncology which are designated as 28 category 2A or lower. 29 b. The diagnosis and treatment of an emergency medical 30 condition that develops or becomes evident in a recipient 31 while the recipient is receiving inpatient care that 32 meets inpatient care standards, if the emergency medical 33 condition is reasonably determined by a provider to present a 34 life-threatening risk unless the recipient receives immediate 35 -11- HF 2635.3065 (1) 91 nls/ko 11/ 22

assessment and treatment. 1 3. This section applies to all of the following: 2 a. All contracts between the department and a managed 3 care organization that are delivered, issued for delivery, 4 continued, extended, or renewed on or after January 1, 2027. 5 b. All requests for prior authorization made on or after 6 January 1, 2027. 7 4. The department may adopt rules pursuant to chapter 17A to 8 administer this section. 9 Sec. 8. NEW SECTION . 514I.13 Prior authorizations —— 10 exemptions. 11 1. For purposes of this section: 12 a. “Emergency medical condition” means the same as defined 13 in 42 C.F.R. §438.114. 14 b. “Health care professional” means a person licensed or 15 certified under the laws of this state to provide health care 16 services to an eligible child. 17 c. “Managed care organization” means an entity acting 18 pursuant to a contract with the department to administer the 19 Hawki program. 20 d. “Prior authorization” means any process used by the 21 department or a managed care organization to determine if, 22 before a health care service is furnished to an eligible child, 23 the service is covered or medically necessary. 24 e. “Utilization review” means a set of formal techniques 25 used to monitor or evaluate the medical necessity, 26 appropriateness, or efficiency of a health care service. 27 2. The department, or a managed care organization, shall 28 not require prior authorization for, or impose additional 29 utilization review requirements on, an eligible child for any 30 of the following: 31 a. A cancer-related screening recommended for the eligible 32 child by the eligible child’s health care professional 33 in accordance with the most recently updated national 34 comprehensive cancer network clinical practice guidelines in 35 -12- HF 2635.3065 (1) 91 nls/ko 12/ 22

oncology which are designated as category 2A or lower. 1 b. The diagnosis and treatment of an emergency medical 2 condition that develops or becomes evident in an eligible child 3 while the eligible child is receiving inpatient care that meets 4 inpatient care standards, if the emergency medical condition is 5 reasonably determined by a health care professional to present 6 a life-threatening risk unless the eligible child receives 7 immediate assessment and treatment. 8 3. This section applies to all of the following: 9 a. All contracts between the department and a managed 10 care organization that are delivered, issued for delivery, 11 continued, extended, or renewed on or after January 1, 2027. 12 b. All requests for prior authorizations made on or after 13 January 1, 2027. 14 4. The department may adopt rules pursuant to chapter 17A to 15 administer this section. 16 DIVISION IV 17 CERTIFICATES OF NEED 18 Sec. 9. Section 135.61, subsection 1, paragraphs d and f, 19 Code 2026, are amended by striking the paragraphs. 20 Sec. 10. Section 135.61, subsection 12, paragraph e, Code 21 2026, is amended by striking the paragraph. 22 Sec. 11. Section 135.61, subsection 16, Code 2026, is 23 amended to read as follows: 24 16. “New institutional health service” or “changed 25 institutional health service” means any of the following: 26 a. (1) The construction, development , or other 27 establishment of a new institutional health facility regardless 28 of ownership if completing the construction, development, or 29 other establishment requires more than the following amount: 30 (a) Beginning on or after January 1, 2027, and before 31 December 31, 2031, four million dollars . 32 (b) Beginning on or after January 1, 2032, and before 33 December 31, 2036, four million five hundred thousand dollars. 34 (c) Beginning on or after January 1, 2037, five million 35 -13- HF 2635.3065 (1) 91 nls/ko 13/ 22

dollars. 1 (2) If the new institutional health facility involves 2 the use of a leased building, the market value of the leased 3 building shall be used when calculating the value of completing 4 construction, development, or other establishment under 5 subparagraph (1). 6 b. Relocation of an institutional health facility. 7 c. Any A capital expenditure, lease, or donation by or on 8 behalf of an institutional health facility in excess of one 9 million five hundred thousand dollars the following amount 10 within a consecutive twelve-month period : 11 (1) Beginning on or after January 1, 2027, and before 12 December 31, 2031, four million dollars. 13 (2) Beginning on or after January 1, 2032, and before 14 December 31, 2036, four million five hundred thousand dollars. 15 (3) Beginning on or after January 1, 2037, five million 16 dollars . 17 d. A permanent change in the bed capacity, as determined 18 by the department, of an institutional health facility. For 19 purposes of this paragraph, a change is permanent if it is 20 intended to be effective for one year or more. 21 e. Any expenditure in excess of five hundred thousand 22 dollars by or on behalf of an institutional health facility for 23 health services which are or will be offered in or through an 24 institutional health facility at a specific time but which were 25 not offered on a regular basis in or through that institutional 26 health facility within the twelve-month period prior to that 27 time. 28 f. The deletion of one or more health services, previously 29 offered on a regular basis by an institutional health facility 30 or health maintenance organization or the relocation of one or 31 more health services from one physical facility to another. 32 g. Any acquisition by or on behalf of a health care provider 33 or a group of health care providers of any piece of replacement 34 equipment with a value in excess of one million five hundred 35 -14- HF 2635.3065 (1) 91 nls/ko 14/ 22

thousand dollars, whether acquired by purchase, lease, or 1 donation. 2 h. e. (1) Any acquisition by or on behalf of a health 3 care provider or group of health care providers of any piece of 4 equipment with a value in excess of one million five hundred 5 thousand dollars , whether acquired by purchase, lease, or 6 donation, which results in the offering or development of a 7 health service not previously provided that has a value in 8 excess of the following amount: 9 (a) Beginning on or after January 1, 2027, and before 10 December 31, 2031, four million dollars . 11 (b) Beginning on or after January 1, 2032, and before 12 December 31, 2036, four million five hundred thousand dollars. 13 (c) Beginning on or after January 1, 2037, five million 14 dollars. 15 (2) A mobile health service provided on a contract basis 16 is not considered to have been previously provided by a health 17 care provider or group of health care providers. 18 i. Any acquisition by or on behalf of an institutional 19 health facility or a health maintenance organization of any 20 piece of replacement equipment with a value in excess of one 21 million five hundred thousand dollars, whether acquired by 22 purchase, lease, or donation. 23 j. f. (1) Any acquisition by or on behalf of an 24 institutional health facility or health maintenance 25 organization of any piece of equipment with a value in excess 26 of one million five hundred thousand dollars , whether acquired 27 by purchase, lease, or donation, which results in the offering 28 or development of a health service not previously provided that 29 has a value in excess of the following amount: 30 (a) Beginning on or after January 1, 2027, and before 31 December 31, 2031, four million dollars . 32 (b) Beginning on or after January 1, 2032, and before 33 December 31, 2036, four million five hundred thousand dollars. 34 (c) Beginning on or after January 1, 2037, five million 35 -15- HF 2635.3065 (1) 91 nls/ko 15/ 22

dollars. 1 (2) A mobile health service provided on a contract basis 2 is not considered to have been previously provided by an 3 institutional health facility. 4 k. Any air transportation service for transportation of 5 patients or medical personnel offered through an institutional 6 health facility at a specific time but which was not offered 7 on a regular basis in or through that institutional health 8 facility within the twelve-month period prior to the specific 9 time. 10 l. g. Any A mobile health service with a value in excess of 11 one four million five hundred thousand dollars. 12 m. Any of the following: 13 (1) Cardiac catheterization service. 14 (2) Open heart surgical service. 15 (3) Organ transplantation service. 16 (4) Radiation therapy service applying ionizing radiation 17 for the treatment of malignant disease using megavoltage 18 external beam equipment. 19 Sec. 12. Section 135.62, subsection 1, Code 2026, is amended 20 to read as follows: 21 1. a. A new institutional health service or changed 22 institutional health service shall not be offered or developed 23 in this state without prior application to the department 24 for , and receipt of , a certificate of need, pursuant to this 25 subchapter . 26 b. The application shall be made upon on forms furnished or 27 prescribed by the department and shall contain such information 28 as required by the department may require under this subchapter 29 by rule adopted pursuant to chapter 17A . 30 c. (1) The application shall be accompanied by a fee 31 equivalent to three-tenths of one percent of the anticipated 32 cost of the project with a minimum fee of six hundred dollars 33 and a maximum fee of twenty-one thousand dollars. The fee 34 shall be remitted by the department to the treasurer of state , 35 -16- HF 2635.3065 (1) 91 nls/ko 16/ 22

who shall place it for deposit in the general fund of the 1 state. An applicant for a new institutional health service or 2 a changed institutional health service offered or developed by 3 an intermediate care facility for persons with an intellectual 4 disability or an intermediate care facility for persons with 5 mental illness, as each of those terms are defined in section 6 135C.1, shall not be required to pay the application fee. 7 (2) If an application is voluntarily withdrawn within 8 thirty calendar days after submission, seventy-five percent 9 of the application fee shall be refunded ; if the application 10 is voluntarily withdrawn more than thirty but within sixty 11 days after submission, fifty percent of the application fee 12 shall be refunded; if the application is withdrawn voluntarily 13 more than sixty days after submission, twenty-five percent of 14 the application fee shall be refunded . Notwithstanding the 15 required payment of an application fee under this subsection , 16 an applicant for a new institutional health service or a 17 changed institutional health service offered or developed by 18 an intermediate care facility for persons with an intellectual 19 disability or an intermediate care facility for persons with 20 mental illness as defined pursuant to section 135C.1 is exempt 21 from payment of the application fee. 22 Sec. 13. Section 135.62, subsection 2, paragraphs a and e, 23 Code 2026, are amended to read as follows: 24 a. Private offices and private clinics of an individual 25 physician, dentist, or other practitioner or group of 26 health care providers, except as provided by section 135.61, 27 subsection 16 , paragraphs “g” , “h” , and “m” paragraph “e” , and 28 section 135.61, subsections 2 and 18 . 29 e. A health maintenance organization or combination of 30 health maintenance organizations or an institutional health 31 facility controlled directly or indirectly by a health 32 maintenance organization or combination of health maintenance 33 organizations, except when the health maintenance organization 34 or combination of health maintenance organizations does any of 35 -17- HF 2635.3065 (1) 91 nls/ko 17/ 22

the following: 1 (1) Constructs, develops, renovates, relocates, or 2 otherwise establishes an institutional health facility. 3 (2) Acquires major medical equipment as provided by section 4 135.61, subsection 16, paragraphs “i” and “j” paragraph “f” . 5 Sec. 14. Section 135.62, subsection 2, paragraph h, 6 subparagraph (2), Code 2026, is amended to read as follows: 7 (2) If these conditions are not met, the institutional 8 health facility or health maintenance organization is subject 9 to review as a “new institutional health service” or “changed 10 institutional health service” under section 135.61, subsection 11 16 , paragraph “f” , and is subject to sanctions under section 12 135.72 . 13 Sec. 15. Section 135.62, subsection 2, Code 2026, is amended 14 by adding the following new paragraphs: 15 NEW PARAGRAPH . r. An organized outpatient health 16 facility that provides behavioral health services as defined 17 by the department by rule, including but not limited to 18 substitution-based treatment centers for opiate addiction. 19 NEW PARAGRAPH . s. Open heart surgical services. 20 NEW PARAGRAPH . t. Organ transplantation services. 21 NEW PARAGRAPH . u. Radiation therapy services. 22 NEW PARAGRAPH . v. Cardiac catheterization services. 23 Sec. 16. Section 135.63, subsection 2, paragraph b, Code 24 2026, is amended by striking the paragraph. 25 Sec. 17. Section 135.65, subsections 1 and 2, Code 2026, are 26 amended to read as follows: 27 1. a. Within fifteen business days after receipt of the 28 date the department receives an application for a certificate 29 of need, the department shall examine the application for form 30 and completeness and accept or reject it. An application 31 shall be rejected only if it fails to provide all information 32 required by the department pursuant to section 135.62, 33 subsection 1 . The department shall promptly return to the 34 applicant any a rejected application , to the applicant with an 35 -18- HF 2635.3065 (1) 91 nls/ko 18/ 22

explanation of the reasons for its rejection. 1 b. Within thirty calendar days of the date the department 2 sends a rejected application to an applicant, the applicant may 3 revise and resubmit the application once for review without 4 submitting another application fee under section 135.62. 5 2. Upon acceptance of an application for a certificate 6 of need, the department shall promptly undertake to notify 7 all affected persons in writing through electronic means 8 that formal review of the application has been initiated. 9 Notification to those affected persons who are consumers 10 or third-party payers or other payers for health services 11 may be provided by electronic distribution of the pertinent 12 information to the news media . 13 Sec. 18. Section 135.65, subsection 3, paragraph b, Code 14 2026, is amended to read as follows: 15 b. A period for the submission of written public hearing 16 comments from affected persons on the application, to be held 17 scheduled prior to completion of the evaluation required by 18 paragraph “a” . 19 Sec. 19. Section 135.65, subsection 4, Code 2026, is amended 20 by striking the subsection. 21 Sec. 20. Section 135.66, subsection 1, Code 2026, is amended 22 to read as follows: 23 1. The department may waive the letter of intent procedures 24 prescribed by section 135.64 and substitute conduct a summary 25 review procedure, which shall be established by rules of 26 adopted by the department, when it the department accepts an 27 application for a certificate of need for a project which that 28 meets any of the following criteria in paragraphs “a” through 29 “e” : 30 a. A project which is limited to repair or replacement of a 31 facility or equipment damaged or destroyed by a disaster, and 32 which will not expand the facility nor increase the services 33 provided beyond the level existing prior to the disaster. 34 b. A project necessary to enable the facility or service to 35 -19- HF 2635.3065 (1) 91 nls/ko 19/ 22

achieve or maintain compliance with federal, state, or other 1 appropriate licensing, certification, or safety requirements. 2 c. A project which will not change the existing bed capacity 3 of the applicant’s facility or service, as determined by the 4 department, by more than ten percent or ten beds, whichever is 5 less, over a two-year period. 6 d. A project the total cost of which will not exceed one 7 hundred fifty thousand dollars. 8 e. d. Any other project for which the applicant proposes 9 and the department agrees to summary review. 10 Sec. 21. Section 135.70, subsection 2, Code 2026, is amended 11 to read as follows: 12 2. Upon expiration of a certificate of need, and prior to 13 extension of the certificate of need, any affected person shall 14 have the right to submit to the department information which 15 may be relevant to the question of granting an extension. The 16 department may call a public hearing for this purpose. 17 Sec. 22. Section 135.71, subsection 4, Code 2026, is amended 18 to read as follows: 19 4. Criteria for determining when it is not feasible to 20 complete formal review of an application for a certificate of 21 need within the time limits limit specified in section 135.68 . 22 The rules adopted under this subsection shall include criteria 23 for determining whether an application proposes introduction 24 of technologically innovative equipment, and if so, procedures 25 to be followed in reviewing the application. However, a rule 26 adopted under this subsection shall not permit a deferral of 27 more than sixty thirty calendar days beyond the time when a 28 decision is required under section 135.68 , unless both the 29 applicant and the department agree to a longer deferment. 30 Sec. 23. Section 135P.1, subsection 3, Code 2026, is amended 31 to read as follows: 32 3. “Health facility” means an any of the following: 33 a. An institutional health facility as defined in section 34 135.61 , a . 35 -20- HF 2635.3065 (1) 91 nls/ko 20/ 22