Bill S.1460

SENATE DOCKET, NO. 2324 FILED ON: 1/20/2023

SENATE . . . . . . . . . . . . . . No. 1460

By Ms. Rausch, a petition (accompanied by bill, Senate, No. 1460) of Rebecca L. Rausch for legislation relative to health care providers material changes and financial impact. Public Health.

The Commonwealth of Massachusetts

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In the One Hundred and Ninety-Third General Court
(2023-2024)

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An Act relative to determinations of need.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

SECTION 1. Section 13 of chapter 6D, as appearing in the 2020 Official Edition, is hereby amended by striking out subsection (a) and inserting in place thereof the following subsection:-

(a) Every provider or provider organization shall, not less than 60 days before making any material change to its operations or governance structure, submit notice to the commission, the center and the attorney general of such proposed change. Material changes shall include, but not be limited to: (i) a substantial change in capacity at a new or existing site; (ii) a corporate merger, acquisition or affiliation of a provider or provider organization and a carrier; (iii) mergers or acquisitions of hospitals or hospital systems; (iv) acquisition of insolvent provider organizations; and (v) mergers or acquisitions of provider organizations which will result in a provider organization having a near-majority of market share in a given service or region.

Within 30 days of receipt of a notice filed under this section, the commission shall conduct a preliminary review to determine whether the material change is likely to result in a significant impact on the commonwealth’s ability to meet the health care cost growth benchmark, established pursuant to section 9 of this chapter, or on the competitive market. If the commission finds that the material change is likely to have a significant impact on the commonwealth’s ability to meet the health care cost growth benchmark, or on the competitive market, the commission may conduct a cost and market impact review under this section.

SECTION 2. Said section 13 of said chapter 6D, as so appearing, is hereby further amended by striking out subsection (e) and inserting in place thereof the following subsection:-

(e) The commission shall make factual findings and issue a preliminary report on the cost and market impact review. In the report, the commission shall identify any provider or provider organization that meets all of the following criteria: (i) the provider or provider organization has, or likely will have as a result of the material change, a dominant market share for the services it provides; (ii) the provider or provider organization charges, or likely will charge as a result of the material change, prices for services that are materially higher than the median prices charged by all other providers for the same services in the same market; and (iii) the provider or provider organization has, or likely will have as a result of the material change, a health status adjusted total medical expense that is materially higher than the median total medical expense for all other providers for the same service in the same market.

SECTION 3. Subsection (f) of section 13 of said chapter 6D is hereby amended by adding, after the third sentence, the following sentence:-

The commission shall provide a copy of said final report to the department of public health, which shall be included in the written record and considered by the department of public health during its review of any applicable application for determination of need and which shall be considered in connection with licensure or other regulatory actions involving the provider or provider organization.

SECTION 4. Section 25C of chapter 111 is hereby amended by striking out subsection (f) and inserting in place thereof the following subsection:-

(f) Except as provided in section 25C1/2, a person or agency of the commonwealth or any political subdivision thereof shall not acquire an existing health care facility unless the person or agency files a determination of need application pursuant to this section.

SECTION 5. Section 25C of chapter 111 is hereby further amended by striking out subsection (g) and inserting in place thereof the following subsection:-

(g) The department, in making any determination of need, shall assess both the applicant and the proposed project, shall be guided by the state health plan, shall encourage appropriate allocation of private and public health care resources and the development of alternative or substitute methods of delivering health care services so that adequate health care services will be made reasonably available to every person within the commonwealth at the lowest reasonable aggregate cost, shall be guided by the commonwealth’s cost containment goals, shall assess impacts both on the applicant’s patients and on other residents of the commonwealth, shall take into account any comments and relevant data from the center for health information and analysis, the health policy commission including but not limited to a cost and market impact review report by the health policy commission pursuant to subsection (f) of section 13 of chapter 6D, and any other state agency or entity, and may impose reasonable terms and conditions as the department determines are necessary to achieve the purposes and intent of this section. The department may also recognize the special needs and circumstances of projects that: (1) are essential to the conduct of research in basic biomedical or health care delivery areas or to the training of health care personnel; (2) are unlikely to result in any increase in the clinical bed capacity or outpatient load capacity of the facility; and (3) are unlikely to cause an increase in the total patient care charges of the facility to the public for health care services, supplies, and accommodations, as such charges shall be defined from time to time in accordance with section 5 of chapter 409 of the acts of 1976.

SECTION 6. Section 25C of chapter 111 is hereby further amended by striking out subsection (h) and inserting in place thereof the following subsection:-

(h) Applications for such determination shall be filed with the department, together with other forms and information as shall be prescribed by, or acceptable to, the department. A duplicate copy of any application together with supporting documentation for such application, shall be a public record and kept on file in the department. The department may require a public hearing on any application at its discretion or at the request of the attorney general. The attorney general may intervene in any hearing under this section. A reasonable fee, established by the department, shall be paid upon the filing of such application; provided, however, that in no event shall such fee exceed 0.2 per cent of the capital expenditures, if any, proposed by the applicant. The department may also require an independent cost-analysis be conducted, at the expense of the applicant, by an entity solely selected by the department, including but not limited to another state agency, to demonstrate that the application is consistent with the commonwealth's efforts to meet the health care cost-containment goals established by the commission. Such entity may request, and the applicant may not unreasonably withhold, confidential data and documents necessary to conduct an independent cost-analysis pursuant to such section; provided, that any confidential data and documents so requested shall be provided to the entity conducting the independent cost-analysis, the department, the health policy commission, and the attorney general, but shall not be disclosed to any person without the consent of the applicant, except in summary form, or when the department, health policy commission or attorney general determines that such disclosure should be made in the public interest after taking into account any privacy, trade secret or anticompetitive considerations; and provided further, that any confidential data and documents so provided shall not be public records and shall be exempt from disclosure under clause Twenty sixth of section 7 of chapter 4 or section 10 of chapter 66.

SECTION 7. Section 25C of chapter 111 is hereby further amended by striking out subsection (j) and inserting in place thereof the following subsection:-

(j) The department shall so approve or disapprove in whole or in part each such application for a determination of need within 4 months after filing with the department; provided, however, that the department may, on 1 occasion only, delay the action for up to 2 months after the applicant has provided information which the department reasonably has requested during the 8 month period; provided further, that period for review of an application for which an independent cost-analysis is required shall be stayed until a complete and final independent cost-analysis is received and accepted by the department and the center for health information and analysis, the health policy commission, the attorney general and any other state agency or entity is provided a reasonable opportunity for comment. Notwithstanding the provisions of this section, any determination of need issued to a holder that is subject to a cost and market impact review under section 13 of chapter 6D shall not go into effect until a minimum of 30 days after the issuance of a final report under subsection (f) of section 13 of chapter 6D; provided further, that any determination of need issued to a holder that is subject to a performance improvement plan pursuant to section 10 of said chapter 6D shall not go into effect until 30 days after a determination by the health policy commission that the holder is implementing or has implemented said performance improvement plan in good faith; provided, however, that the health policy commission may rescind its determination that the holder is implementing a performance improvement plan in good faith at any time prior to successful completion of the performance improvement plan. Applications remanded to the department by the health facilities appeals board under section 25E shall be acted upon by the department within the same time limits provided in this section for the department to approve or disapprove applications for a determination of need. If an application has not been acted upon by the department within such time limits, the applicant may, within a reasonable period of time, bring an action in the nature of mandamus in the superior court to require the department to act upon the application.

Name:	District/Address:
Rebecca L. Rausch	Norfolk, Worcester and Middlesex