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An act relating to certificates of need; amending s.

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408.035, F.S.; revising the requirements for the Agency

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for Health Care Administration with respect to reviewing

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an application for a certificate of need for a general

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hospital; amending s. 408.037, F.S.; revising the

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requirements for an application for a certificate of need

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by an applicant for a general hospital; amending s.

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408.039, F.S.; requiring the agency to attend public

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hearings on such applications; requiring an existing

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hospital to submit a written statement of opposition in

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order to challenge the agency decision on an application

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for a certificate of need for a general hospital;

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authorizing the applicant to submit a written response;

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limiting filing a letter of intent to file an application;

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limiting the period of a continuance that may be granted

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with respect to an administrative hearing considering an

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application for a general hospital; limiting the parties

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who may challenge in an administrative hearing involving

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an application for a certificate of need; limiting the

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scope of the challenge; authorizing the administrative

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judge to expand the scope of the issues to be heard upon a

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motion showing good cause; requiring that the party

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appealing a final order granting a certificate of need for

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a general hospital pay the appellee's attorney's fees and

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costs subject to certain requirements; repealing s.

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408.040(3), F.S.; relating to a requirement for an

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architect's certification of final payment before issuance

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of a certificate of need; providing for application of the

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act; providing for severability; providing an effective

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date.

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Be It Enacted by the Legislature of the State of Florida:

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     Section 1.  Section 408.035, Florida Statutes, is amended to

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read:

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     408.035  Review criteria.--

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     (1) The agency shall determine the reviewability of

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applications and shall review applications for certificate-of-

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need determinations for health care facilities and health

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services in context with the following criteria, except for

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general hospitals as defined in s. 395.002:

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     (a)(1) The need for the health care facilities and health

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services being proposed.

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     (b)(2) The availability, quality of care, accessibility,

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and extent of utilization of existing health care facilities and

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health services in the service district of the applicant.

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     (c)(3) The ability of the applicant to provide quality of

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care and the applicant's record of providing quality of care.

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     (d)(4) The availability of resources, including health

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personnel, management personnel, and funds for capital and

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operating expenditures, for project accomplishment and operation.

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     (e)(5) The extent to which the proposed services will

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enhance access to health care for residents of the service

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district.

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     (f)(6) The immediate and long-term financial feasibility of

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the proposal.

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     (g)(7) The extent to which the proposal will foster

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competition that promotes quality and cost-effectiveness.

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     (h)(8) The costs and methods of the proposed construction,

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including the costs and methods of energy provision and the

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availability of alternative, less costly, or more effective

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methods of construction.

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     (i)(9) The applicant's past and proposed provision of

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health care services to Medicaid patients and the medically

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indigent.

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     (j)(10) The applicant's designation as a Gold Seal Program

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nursing facility pursuant to s. 400.235, when the applicant is

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requesting additional nursing home beds at that facility.

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     (2) For a general hospital, the agency shall consider only

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the criteria specified in paragraph (1)(a), paragraph (1)(b),

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except for quality of care in paragraph (1)(b), and paragraphs

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(1)(e), (g), and (i).

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     Section 2.  Section 408.037, Florida Statutes, is amended to

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read:

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     408.037  Application content.--

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     (1) Except as provided in subsection (2) for a general

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hospital, an application for a certificate of need must contain:

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     (a)  A detailed description of the proposed project and

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statement of its purpose and need in relation to the district

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health plan.

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     (b)  A statement of the financial resources needed by and

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available to the applicant to accomplish the proposed project.

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This statement must include:

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     1.  A complete listing of all capital projects, including

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new health facility development projects and health facility

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acquisitions applied for, pending, approved, or underway in any

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state at the time of application, regardless of whether or not

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that state has a certificate-of-need program or a capital

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expenditure review program pursuant to s. 1122 of the Social

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Security Act. The agency may, by rule, require less-detailed

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information from major health care providers. This listing must

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include the applicant's actual or proposed financial commitment

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to those projects and an assessment of their impact on the

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applicant's ability to provide the proposed project.

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     2.  A detailed listing of the needed capital expenditures,

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including sources of funds.

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     3.  A detailed financial projection, including a statement

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of the projected revenue and expenses for the first 2 years of

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operation after completion of the proposed project. This

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statement must include a detailed evaluation of the impact of the

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proposed project on the cost of other services provided by the

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applicant.

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     (c)  An audited financial statement of the applicant. In an

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application submitted by an existing health care facility, health

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maintenance organization, or hospice, financial condition

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documentation must include, but need not be limited to, a balance

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sheet and a profit-and-loss statement of the 2 previous fiscal

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years' operation.

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     (2) An application for a certificate of need for a general

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hospital must contain a detailed description of the proposed

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general hospital project and a statement of its purpose and the

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needs it will meet. The proposed project's location, as well as

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its primary and secondary service areas, must be identified by

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zip code. Primary service area is defined as the zip codes from

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which the applicant projects that it will draw 75 percent of its

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discharges. Secondary service area is defined as the zip codes

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from which the applicant projects that it will draw its remaining

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discharges. If, subsequent to issuance of a final order approving

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the certificate of need, the proposed location of the general

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hospital changes or the primary service area materially changes,

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the agency shall revoke the certificate of need. However, if the

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agency determines that such changes are deemed to enhance access

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to hospital services in the service district, the agency may

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permit such changes to occur. A party participating in the

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administrative hearing regarding the issuance of the certificate

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of need for a general hospital has standing to participate in any

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subsequent proceeding regarding the revocation of the certificate

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of need for a hospital for which the location has changed or for

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which the primary service area has materially changed. In

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addition, the application for the certificate of need for a

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general hospital must include a statement of intent that, if

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approved by final order of the agency, the applicant shall within

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120 days after issuance of the final order or, if there is an

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appeal of the final order, within 120 days after the issuance of

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the court's mandate on appeal, furnish satisfactory proof of the

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applicant's financial ability to operate. The agency shall

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establish documentation requirements, to be completed by each

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applicant, which show anticipated provider revenues and

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expenditures, the basis for financing the anticipated cash-flow

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requirements of the provider, and an applicant's access to

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contingency financing. A party participating in the

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administrative hearing regarding the issuance of the certificate

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of need for a general hospital may provide written comments

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concerning the adequacy of the financial information provided,

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but such party does not have standing to participate in an

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administrative proceeding regarding proof of the applicant's

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financial ability to operate. The agency may require a licensee

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to provide proof of financial ability to operate at any time if

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there is evidence of financial instability, including, but not

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limited to, unpaid expenses necessary for the basic operations of

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the provider.

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     (3)(2) The applicant must certify that it will license and

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operate the health care facility. For an existing health care

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facility, the applicant must be the licenseholder of the

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facility.

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     Section 3.  Subsection (3), paragraphs (b) and (c) of

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subsection (5), and paragraph (d) is added to subsection (6) of

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section 408.039, Florida Statutes, to read:

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     408.039  Review process.--The review process for

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certificates of need shall be as follows:

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     (3)  APPLICATION PROCESSING.--

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     (a)  An applicant shall file an application with the agency

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and shall furnish a copy of the application to the agency. Within

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15 days after the applicable application filing deadline

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established by agency rule, the staff of the agency shall

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determine if the application is complete. If the application is

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incomplete, the staff shall request specific information from the

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applicant necessary for the application to be complete; however,

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the staff may make only one such request. If the requested

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information is not filed with the agency within 21 days after the

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receipt of the staff's request, the application shall be deemed

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incomplete and deemed withdrawn from consideration.

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     (b)  Upon the request of any applicant or substantially

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affected person within 14 days after notice that an application

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has been filed, a public hearing may be held at the agency's

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discretion if the agency determines that a proposed project

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involves issues of great local public interest. In such cases,

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the agency shall attend the public hearing. The public hearing

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shall allow applicants and other interested parties reasonable

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time to present their positions and to present rebuttal

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information. A recorded verbatim record of the hearing shall be

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maintained. The public hearing shall be held at the local level

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within 21 days after the application is deemed complete.

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     (c) Except for competing applicants, in order to be

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eligible to challenge the agency decision on a general hospital

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application under review pursuant to paragraph (5)(c), existing

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hospitals must submit a detailed written statement of opposition

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to the agency and to the applicant. The detailed written

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statement must be received by the agency and the applicant within

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21 days after the general hospital application is deemed complete

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and made available to the public.

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     (d) In those cases where a written statement of opposition

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has been timely filed regarding a certificate of need application

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for a general hospital, the applicant for the general hospital

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may submit a written response to the agency. Such response must

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be received by the agency within 10 days of the written statement

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due date.

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     (5)  ADMINISTRATIVE HEARINGS.--

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     (b)  Hearings shall be held in Tallahassee unless the

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administrative law judge determines that changing the location

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will facilitate the proceedings. The agency shall assign

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proceedings requiring hearings to the Division of Administrative

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Hearings of the Department of Management Services within 10 days

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after the time has expired for requesting a hearing. Except upon

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unanimous consent of the parties or upon the granting by the

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administrative law judge of a motion of continuance, hearings

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shall commence within 60 days after the administrative law judge

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has been assigned. For an application for a general hospital,

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administrative hearings shall commence within 6 months after the

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administrative law judge has been assigned, and a continuance may

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not be granted absent a finding of extraordinary circumstances by

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the administrative law judge. All parties, except the agency,

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shall bear their own expense of preparing a transcript. In any

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application for a certificate of need which is referred to the

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Division of Administrative Hearings for hearing, the

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administrative law judge shall complete and submit to the parties

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a recommended order as provided in ss. 120.569 and 120.57. The

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recommended order shall be issued within 30 days after the

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receipt of the proposed recommended orders or the deadline for

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submission of such proposed recommended orders, whichever is

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earlier. The division shall adopt procedures for administrative

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hearings which shall maximize the use of stipulated facts and

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shall provide for the admission of prepared testimony.

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     (c)  In administrative proceedings challenging the issuance

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or denial of a certificate of need, only applicants considered by

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the agency in the same batching cycle are entitled to a

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comparative hearing on their applications. Existing health care

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facilities may initiate or intervene in an administrative hearing

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upon a showing that an established program will be substantially

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affected by the issuance of any certificate of need, whether

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reviewed under s. 408.036(1) or (2), to a competing proposed

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facility or program within the same district. With respect to an

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application for a general hospital, competing applicants and only

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those existing hospitals that submitted a detailed written

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statement of opposition to an application as provided in this

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paragraph may initiate or intervene in an administrative hearing.

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Such challenges to a general hospital application shall be

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limited in scope to the issues raised in the detailed written

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statement of opposition that was provided to the agency. The

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administrative law judge may, upon a motion showing good cause,

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expand the scope of the issues to be heard at the hearing. Such

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motion shall include substantial and detailed facts and reasons

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for failure to include such issues in the original written

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statement of opposition.

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     (6)  JUDICIAL REVIEW.--

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     (d) The party appealing a final order that grants a general

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hospital certificate of need shall pay the appellee's attorney's

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fees and costs, in an amount up to $1 million, from the beginning

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of the original administrative action if the appealing party

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loses the appeal, subject to the following limitations and

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requirements:

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     1. The party appealing a final order must post a bond in

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the amount of $1 million in order to maintain the appeal.

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     2. Except as provided under s. 120.595(5), in no event

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shall the agency be held liable for any other party's attorney's

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fees or costs.

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     Section 4. Subsection (3) of section 408.040, Florida

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Statutes, is repealed.

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     Section 5. The provisions of this act do not apply to a

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certificate of need application filed before the effective date

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of this act.

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     Section 6. If any provision of this act or its

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application to any person or circumstance is held invalid, the

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invalidity does not affect other provisions or applications of

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the act which can be given effect without the invalid provision

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or application, and to this end the provisions of this act are

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severable.

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     Section 7.  This act shall take effect upon becoming a law.