S.F. _____ Section 1. Section 135.61, subsections 1, 14, 15, and 18, 1 Code 2023, are amended to read as follows: 2 1. “Affected persons” means, with respect to an application 3 for a certificate of need: 4 a. The person submitting the application. 5 b. Consumers who would be served by the new institutional 6 health service proposed in the application. 7 c. Each institutional health facility or health maintenance 8 organization which is located in the geographic area which 9 would appropriately be served by the new institutional 10 health service proposed in the application. The appropriate 11 geographic service area of each institutional health facility 12 or health maintenance organization shall be determined on a 13 uniform basis in accordance with criteria established in rules 14 adopted by the department. 15 d. Each institutional health facility or health maintenance 16 organization which, prior to receipt of the application by 17 the department, has formally indicated to the department 18 pursuant to this subchapter an intent to furnish in the future 19 institutional health services similar to the new institutional 20 health service proposed in the application. 21 e. Any other person designated as an affected person by 22 rules of the department. 23 f. Any payer or third-party payer for health services. 24 14. “Institutional health facility” means any of the 25 following, without regard to whether the facilities referred 26 to are publicly or privately owned or are organized for profit 27 or not or whether the facilities are part of or sponsored by a 28 health maintenance organization: 29 a. A hospital. 30 b. A health care facility. 31 c. An organized outpatient health facility. 32 d. An outpatient surgical facility. 33 e. A community mental health facility. 34 f. A birth center. 35 -1- LSB 1825XC (3) 90 pf/rh 1/ 14

S.F. _____ 15. “Institutional health service” means any health service 1 furnished in or through institutional health facilities or 2 health maintenance organizations , including mobile health 3 services . 4 18. “New institutional health service” or “changed 5 institutional health service” means any of the following: 6 a. The construction, development , or other establishment of 7 a new institutional health facility regardless of ownership. 8 b. Relocation of an institutional health facility. 9 c. Any capital expenditure, lease, or donation by or 10 on behalf of an institutional health facility in excess 11 of one five million five hundred thousand dollars within a 12 twelve-month period. 13 d. A permanent change in the bed capacity, as determined 14 by the department, of an institutional health facility. For 15 purposes of this paragraph, a change is permanent if it is 16 intended to be effective for one year or more. 17 e. Any expenditure in excess of five hundred thousand 18 dollars by or on behalf of an institutional health facility for 19 health services which are or will be offered in or through an 20 institutional health facility at a specific time but which were 21 not offered on a regular basis in or through that institutional 22 health facility within the twelve-month period prior to that 23 time. 24 f. The deletion of one or more health services, previously 25 offered on a regular basis by an institutional health facility 26 or health maintenance organization or the relocation of one or 27 more health services from one physical facility to another. 28 g. Any acquisition by or on behalf of a health care provider 29 or a group of health care providers of any piece of replacement 30 equipment with a value in excess of one million five hundred 31 thousand dollars, whether acquired by purchase, lease, or 32 donation. 33 h. Any acquisition by or on behalf of a health care provider 34 or group of health care providers of any piece of equipment 35 -2- LSB 1825XC (3) 90 pf/rh 2/ 14

S.F. _____ with a value in excess of one million five hundred thousand 1 dollars, whether acquired by purchase, lease, or donation, 2 which results in the offering or development of a health 3 service not previously provided. A mobile service provided 4 on a contract basis is not considered to have been previously 5 provided by a health care provider or group of health care 6 providers. 7 i. Any acquisition by or on behalf of an institutional 8 health facility or a health maintenance organization of any 9 piece of replacement equipment with a value in excess of one 10 million five hundred thousand dollars, whether acquired by 11 purchase, lease, or donation. 12 j. Any acquisition by or on behalf of an institutional 13 health facility or health maintenance organization of any 14 piece of equipment with a value in excess of one million five 15 hundred thousand dollars, whether acquired by purchase, lease, 16 or donation, which results in the offering or development of 17 a health service not previously provided. A mobile service 18 provided on a contract basis is not considered to have been 19 previously provided by an institutional health facility. 20 k. Any air transportation service for transportation of 21 patients or medical personnel offered through an institutional 22 health facility at a specific time but which was not offered 23 on a regular basis in or through that institutional health 24 facility within the twelve-month period prior to the specific 25 time. 26 l. Any mobile health service with a value in excess of one 27 million five hundred thousand dollars. 28 m. Any of the following: 29 (1) Cardiac catheterization service. 30 (2) Open heart surgical service. 31 (3) Organ transplantation service. 32 (4) Radiation therapy service applying ionizing radiation 33 for the treatment of malignant disease using megavoltage 34 external beam equipment. 35 -3- LSB 1825XC (3) 90 pf/rh 3/ 14

S.F. _____ Sec. 2. Section 135.61, subsections 2 and 16, Code 2023, are 1 amended by striking the subsections. 2 Sec. 3. Section 135.62, subsection 2, paragraphs a, b, and 3 c, Code 2023, are amended to read as follows: 4 a. Qualifications. The members of the council shall be 5 chosen so that the council as a whole is broadly representative 6 of various geographical areas of the state and no more than 7 three of its members are affiliated with the same political 8 party. Each council member shall be a person who has 9 demonstrated by prior activities an informed concern for the 10 planning and delivery of health services . A member of the 11 council and any spouse of a member shall not, during the 12 time that member is serving on the council, do either of the 13 following: 14 (1) Be a health care provider nor be otherwise directly or 15 indirectly engaged in the delivery of health care services nor 16 have a material financial interest in the providing or delivery 17 of health services. 18 (2) Serve as a member of any board or other policymaking 19 or advisory body of an institutional health facility, a health 20 maintenance organization, or any health or hospital insurer. 21 b. Appointments. Terms of council members shall be six 22 three years, beginning and ending as provided in section 23 69.19 . A member shall be appointed in each odd-numbered 24 year to succeed each member whose term expires in that year. 25 Vacancies shall be filled by the governor for the balance of 26 the unexpired term. Each appointment to the council is subject 27 to confirmation by the senate. A council member is ineligible 28 for appointment to a second consecutive term, unless first 29 appointed to an unexpired term of three years or less. 30 c. Chairperson. The governor council shall designate one 31 of the council members as chairperson. That designation may 32 be changed not later than July 1 of any odd-numbered year, 33 effective on the date of the organizational meeting held in 34 that year under paragraph “d” . 35 -4- LSB 1825XC (3) 90 pf/rh 4/ 14

S.F. _____ Sec. 4. Section 135.63, subsection 1, Code 2023, is amended 1 to read as follows: 2 1. A new institutional health service or changed 3 institutional health service shall not be offered or developed 4 in this state without prior application to the department 5 for and receipt of a certificate of need, pursuant to 6 this subchapter . The application shall be made upon forms 7 furnished or prescribed by the department and shall contain 8 such information as the department may require under this 9 subchapter . The application shall be accompanied by an 10 economic impact statement that includes information specified 11 by rule to assist the department and the council in the 12 evaluation of the application pursuant to section 135.64. 13 The application shall be accompanied by a fee equivalent to 14 three-tenths of one percent of the anticipated cost of the 15 project with a minimum fee of six hundred dollars and a maximum 16 fee of twenty-one of one thousand dollars. The fee shall be 17 remitted by the department to the treasurer of state, who shall 18 place it in the general fund of the state. If an application 19 is voluntarily withdrawn within thirty calendar days after 20 submission, seventy-five percent of the application fee shall 21 be refunded ; if the application is voluntarily withdrawn more 22 than thirty but within sixty days after submission, fifty 23 percent of the application fee shall be refunded; if the 24 application is withdrawn voluntarily more than sixty days 25 after submission, twenty-five percent of the application fee 26 shall be refunded . Notwithstanding the required payment of 27 an application fee under this subsection , an applicant for a 28 new institutional health service or a changed institutional 29 health service offered or developed by an intermediate care 30 facility for persons with an intellectual disability or an 31 intermediate care facility for persons with mental illness as 32 defined pursuant to section 135C.1 is exempt from payment of 33 the application fee. 34 Sec. 5. Section 135.63, subsection 2, paragraphs a and e, 35 -5- LSB 1825XC (3) 90 pf/rh 5/ 14

S.F. _____ Code 2023, are amended to read as follows: 1 a. Private offices and private clinics of an individual 2 physician, dentist, or other practitioner or group of 3 health care providers, except as provided by section 135.61, 4 subsection 18 , paragraphs “g” , “h” , and “m” , and section 135.61, 5 subsections 20 and 21 . 6 e. A health maintenance organization or combination of 7 health maintenance organizations or an institutional health 8 facility controlled directly or indirectly by a health 9 maintenance organization or combination of health maintenance 10 organizations, except when the health maintenance organization 11 or combination of health maintenance organizations does any of 12 the following: 13 (1) Constructs constructs , develops, renovates, relocates, 14 or otherwise establishes an institutional health facility. 15 (2) Acquires major medical equipment as provided by section 16 135.61, subsection 18 , paragraphs “i” and “j” . 17 Sec. 6. Section 135.63, subsection 2, paragraph h, Code 18 2023, is amended by striking the paragraph. 19 Sec. 7. Section 135.63, subsection 4, unnumbered paragraph 20 1, Code 2023, is amended to read as follows: 21 A copy of the application shall be sent to the department 22 of human services at the time the application is submitted to 23 the Iowa department of public health. The department shall not 24 process applications for and the council shall not consider a 25 new or changed institutional health service for an intermediate 26 care facility for persons with an intellectual disability 27 unless both of the following conditions are met: 28 Sec. 8. Section 135.66, subsections 1 and 2, Code 2023, are 29 amended to read as follows: 30 1. a. Within fifteen business days after receipt of an 31 application for a certificate of need, the department shall 32 examine the application for form and completeness and accept 33 or reject it. An application shall be rejected only if it 34 fails to provide all information required by the department 35 -6- LSB 1825XC (3) 90 pf/rh 6/ 14

S.F. _____ pursuant to section 135.63, subsection 1 . The department shall 1 promptly return to the applicant any rejected application, with 2 an explanation of the reasons for its rejection. 3 b. Within thirty days after notifying the applicant of 4 rejection of the application, the applicant may resubmit a 5 revised application for review under this subsection and shall 6 not be subject to payment of another required application 7 fee pursuant to section 135.63. If a subsequent rejection 8 is issued, the applicant shall resubmit the application in 9 accordance with and shall be subject to the procedure and 10 requirements for an initial application. 11 2. Upon acceptance of an application for a certificate 12 of need, the department shall promptly undertake to notify 13 all affected persons in writing that formal review of the 14 application has been initiated. Notification to those affected 15 persons who are consumers or third-party payers or other 16 payers for health services may be provided by distribution of 17 the pertinent information to the news media by an electronic 18 distribution method available to the department . 19 Sec. 9. Section 135.67, subsection 1, Code 2023, is amended 20 to read as follows: 21 1. The department may waive the letter of intent procedures 22 prescribed by section 135.65 and substitute conduct a summary 23 review procedure, which shall be established by rules of the 24 department, when it accepts an application for a certificate of 25 need for a project which meets any of the following criteria 26 in paragraphs “a” through “e” : 27 a. A project which is limited to repair or replacement of a 28 facility or equipment damaged or destroyed by a disaster, and 29 which will not expand the facility nor increase the services 30 provided beyond the level existing prior to the disaster. 31 b. A project necessary to enable the facility or service to 32 achieve or maintain compliance with federal, state, or other 33 appropriate licensing, certification, or safety requirements. 34 c. A project which will not change the existing bed capacity 35 -7- LSB 1825XC (3) 90 pf/rh 7/ 14

S.F. _____ of the applicant’s facility or service, as determined by the 1 department, by more than ten percent or ten beds, whichever is 2 less, over a two-year period. 3 d. A project the total cost of which will not exceed one 4 hundred fifty thousand dollars. 5 e. d. Any other project for which the applicant proposes 6 and the department agrees to summary review. 7 Sec. 10. Section 135.69, Code 2023, is amended to read as 8 follows: 9 135.69 Council to make final decision. 10 1. The department shall complete its formal review of 11 the application within ninety thirty days after acceptance 12 of the application, except as otherwise provided by section 13 135.72, subsection 4 . Upon completion of the formal review, 14 the council shall approve or deny the application. The council 15 shall issue written findings stating the basis for its decision 16 on the application, and the department shall send copies of 17 the council’s decision and the written findings supporting 18 the decision to the applicant and to any other person who so 19 requests. 20 2. Failure by the council to issue a written decision on an 21 application for a certificate of need within the time required 22 by this section shall constitute denial approval of and final 23 administrative action on the application. 24 Sec. 11. Section 135.72, subsection 4, Code 2023, is amended 25 to read as follows: 26 4. Criteria for determining when it is not feasible to 27 complete formal review of an application for a certificate of 28 need within the time limits specified in section 135.69 . The 29 rules adopted under this subsection shall include criteria for 30 determining whether an application proposes introduction of 31 technologically innovative equipment, and if so, procedures 32 to be followed in reviewing the application. However, a rule 33 adopted under this subsection shall not permit a deferral of 34 more than sixty thirty days beyond the time when a decision is 35 -8- LSB 1825XC (3) 90 pf/rh 8/ 14

S.F. _____ required under section 135.69 , unless both the applicant and 1 the department agree to a longer deferment. 2 Sec. 12. Section 135.73, subsection 1, Code 2023, is amended 3 to read as follows: 4 1. Any party constructing a new institutional health 5 facility or an addition to or renovation of an existing 6 institutional health facility without first obtaining a 7 certificate of need or, in the case of a mobile health service, 8 ascertaining that the mobile health service has received 9 certificate of need approval, as required by this subchapter , 10 shall be denied licensure or change of licensure by the 11 appropriate responsible licensing agency of this state. 12 Sec. 13. Section 135.131, subsection 1, paragraph a, Code 13 2023, is amended to read as follows: 14 a. “Birth center” means birth center as defined in section 15 135.61 a facility or institution, which is not an ambulatory 16 surgical center or a hospital or in a hospital, in which 17 births are planned to occur following a normal, uncomplicated, 18 low-risk pregnancy . 19 Sec. 14. Section 135P.1, Code 2023, is amended to read as 20 follows: 21 135P.1 Definitions. 22 For the purposes of this chapter , unless the context 23 otherwise requires: 24 1. “Adverse health care incident” means an objective and 25 definable outcome arising from or related to patient care that 26 results in the death or physical injury of a patient. 27 2. “Health care provider” means a physician or osteopathic 28 physician licensed under chapter 148 , a physician assistant 29 licensed and practicing under a supervising physician pursuant 30 to chapter 148C , a podiatrist licensed under chapter 149 , a 31 chiropractor licensed under chapter 151 , a licensed practical 32 nurse, a registered nurse, or an advanced registered nurse 33 practitioner licensed under chapter 152 or 152E , a dentist 34 licensed under chapter 153 , an optometrist licensed under 35 -9- LSB 1825XC (3) 90 pf/rh 9/ 14

S.F. _____ chapter 154 , a pharmacist licensed under chapter 155A , or 1 any other person who is licensed, certified, or otherwise 2 authorized or permitted by the law of this state to administer 3 health care in the ordinary course of business or in the 4 practice of a profession. 5 3. “Health facility” means an institutional health facility 6 as defined in section 135.61 , a hospice licensed under chapter 7 135J , a home health agency as defined in section 144D.1 , an 8 assisted living program certified under chapter 231C , a clinic, 9 a community health center, or the university of Iowa hospitals 10 and clinics, and includes any corporation, professional 11 corporation, partnership, limited liability company, limited 12 liability partnership, or other entity comprised of such health 13 facilities. 14 4. “Institutional health facility” means any of the 15 following, without regard to whether the facilities referred 16 to are publicly or privately owned or are organized for profit 17 or not, or whether the facilities are part of or sponsored by a 18 health maintenance organization: 19 a. A hospital. 20 b. A health care facility. 21 c. An organized outpatient health facility. 22 d. An outpatient surgical facility. 23 e. A community mental health facility. 24 f. A birth center. 25 4. 5. “Open discussion” means all communications that are 26 made under section 135P.3 , and includes all memoranda, work 27 products, documents, and other materials that are prepared 28 for or submitted in the course of or in connection with 29 communications under section 135P.3 . 30 5. 6. “Patient” means a person who receives medical care 31 from a health care provider, or if the person is a minor, 32 deceased, or incapacitated, the person’s legal representative. 33 Sec. 15. REPEAL. Section 135.65, Code 2023, is repealed. 34 EXPLANATION 35 -10- LSB 1825XC (3) 90 pf/rh 10/ 14

S.F. _____ The inclusion of this explanation does not constitute agreement with 1 the explanation’s substance by the members of the general assembly. 2 This bill relates to the health facilities council (HFC) and 3 the certificate of need (CON) process. 4 The bill amends the definition of “affected person” with 5 respect to an application for CON to eliminate from inclusion 6 in the definition each institutional health facility or 7 health maintenance organization which, prior to receipt of 8 the application, has formally indicated an intent to furnish 9 in the future institutional health services similar to the 10 new institutional health service proposed in the application; 11 any other person designated as an affected person by rules of 12 the department; and any payer or third-party payer for health 13 services. 14 The bill amends the definition of “institutional health 15 facility” by removing a “community mental health facility” 16 and a “birth center” from inclusion in the definition, 17 thereby making these facilities and centers exempt from CON 18 requirements. 19 The bill amends the definition of “new institutional 20 health service” or “changed institutional health service” 21 by striking many of the services included in current Code 22 and only including: the construction, development, or other 23 establishment of a new institutional health facility regardless 24 of ownership; relocation of an institutional health facility; 25 any capital expenditure, lease, or donation by or on behalf of 26 an institutional health facility in excess of $5 million within 27 a 12-month period, and a permanent change (effective for one 28 year or more) in the bed capacity of an institutional health 29 facility. Under the bill, only these services included in the 30 definition are subject to CON requirements. 31 The bill eliminates terms defined and references to these 32 terms under the Code chapter that are no longer necessary due 33 to provisions of the bill including the definitions of “birth 34 center” and “mobile health service”. 35 -11- LSB 1825XC (3) 90 pf/rh 11/ 14

S.F. _____ The bill amends the qualifications for members of the HFC by 1 retaining the requirement that members of the council be chosen 2 so that the council as a whole is broadly representative of 3 various geographical areas of the state, but eliminating the 4 requirements that no more than three members are affiliated 5 with the same political party and that each council member be 6 a person who has demonstrated by prior activities an informed 7 concern for the planning and delivery of health services. 8 Code section 69.16 requires that all appointive bodies if 9 not otherwise provided by law shall be bipartisan in their 10 composition. 11 The bill amends HFC member appointment provisions to provide 12 that terms of council members shall be three rather than six 13 years, and by eliminating the requirements that a member shall 14 be appointed in each odd-numbered year to succeed each member 15 whose term expires in that year, that vacancies shall be filled 16 by the governor for the balance of the unexpired term, and that 17 each appointment to the council is subject to confirmation by 18 the senate. The bill also removes the provision that a council 19 member is ineligible for appointment to a second consecutive 20 term, unless first appointed to an unexpired term of three 21 years or less. 22 With regard to the chairperson of the HFC, the bill provides 23 that the council, rather than the governor, shall designate one 24 of the council members as chairperson. 25 The bill amends the fee requirements relating to the 26 application for a CON to provide that instead of a fee 27 equivalent to three-tenths of 1 percent of the anticipated 28 cost of the project with a minimum fee of $600 and a maximum 29 fee of $21,000, the fee is $1,000. The bill retains the 30 provision that provides that if an application is voluntarily 31 withdrawn within 30 calendar days after submission, 75 percent 32 of the application fee shall be refunded, but eliminates 33 the proportionate refund of any portion of the fee if the 34 application is voluntarily withdrawn beyond that 30-day period. 35 -12- LSB 1825XC (3) 90 pf/rh 12/ 14

S.F. _____ The bill requires that an application be accompanied by an 1 economic impact statement that includes information required by 2 rule to assist in evaluation of the application. 3 Due to the combining of the department of human services 4 (DHS) and the department of public health (DPH) into the 5 department of health and human services (HHS), the bill 6 eliminates the requirement that a copy of the application for 7 CON be sent to DHS at the time the application is submitted to 8 DPH. 9 Current law provides that within 15 business days after 10 receipt of an application for a CON, HHS shall examine the 11 application and accept or reject it, and that HHS shall 12 promptly return to the applicant any rejected application, with 13 an explanation of the reasons for its rejection. The bill adds 14 a provision that within 30 days after notifying the applicant 15 of rejection of the application, the applicant may resubmit 16 a revised application for review and shall not be subject to 17 payment of another required application fee. Further, if a 18 subsequent rejection is issued, the applicant shall resubmit 19 the application in accordance with and shall be subject to the 20 procedure and requirements for an initial application. 21 Current law provides that upon acceptance of an application 22 for a CON, HHS shall promptly notify all affected persons 23 in writing that formal review of the application has been 24 initiated, and that notification to those affected persons who 25 are consumers or third-party payers or other payers for health 26 services may be provided notification by distribution of the 27 pertinent information to the news media. The bill amends this 28 provision to eliminate the reference to third-party payers or 29 other payers as they are no longer included in the definition 30 of affected persons, and provides that notification to affected 31 persons who are consumers may be provided by an electronic 32 distribution method available to HHS. 33 The bill eliminates the letter of intent procedure requiring 34 that before applying for a CON, the sponsor of a proposed 35 -13- LSB 1825XC (3) 90 pf/rh 13/ 14

S.F. _____ new institutional health service or changed institutional 1 health service submit to HHS a letter of intent to offer or 2 develop a service requiring a CON, as soon as possible after 3 initiation of the applicant’s planning process and not less 4 than 30 days before applying for a CON and before substantial 5 expenditures to offer or develop the service are made. Under 6 this provision, the letter must include a brief description 7 of the proposed new or changed service, its location, and its 8 estimated cost. If requested by the sponsor, HHS was required 9 to make a preliminary review of the letter and inform the 10 sponsor of any factors likely to result in denial of a CON. The 11 bill also makes a conforming change to eliminate a reference to 12 the letter of intent procedure. 13 The bill amends the time frames related to the HFC’s review 14 of CON applications. The bill requires that HHS shall complete 15 its formal review of the application within 30 days, rather 16 than the current 90 days, after acceptance of the application. 17 The bill also provides that failure by the council to issue a 18 written decision on a CON application within the time required 19 shall constitute approval rather than the current denial of and 20 final administrative action on the application. 21 The bill provides that any administrative rule adopted for 22 determining when it is not feasible to complete formal review 23 of an application for a CON within the time limits specified 24 for the HFC’s final decision shall not permit a deferral of 25 more than 30 days, rather than the current 60 days, beyond 26 the time specified for a decision on the final decision, 27 unless both the applicant and the department agree to a longer 28 deferment. 29 -14- LSB 1825XC (3) 90 pf/rh 14/ 14