1.1                          A bill for an act 
  1.2             relating to health; modifying provisions of the 
  1.3             hospital construction moratorium; amending Minnesota 
  1.4             Statutes 1996, section 144.551, subdivision 1. 
  1.5   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.6      Section 1.  Minnesota Statutes 1996, section 144.551, 
  1.7   subdivision 1, is amended to read: 
  1.8      Subdivision 1.  [RESTRICTED CONSTRUCTION OR MODIFICATION.] 
  1.9   (a) The following construction or modification may not be 
  1.10  commenced:  
  1.11     (1) any erection, building, alteration, reconstruction, 
  1.12  modernization, improvement, extension, lease, or other 
  1.13  acquisition by or on behalf of a hospital that increases the bed 
  1.14  capacity of a hospital, relocates hospital beds from one 
  1.15  physical facility, complex, or site to another, or otherwise 
  1.16  results in an increase or redistribution of hospital beds within 
  1.17  the state; and 
  1.18     (2) the establishment of a new hospital.  
  1.19     (b) This section does not apply to:  
  1.20     (1) construction or relocation within a county by a 
  1.21  hospital, clinic, or other health care facility that is a 
  1.22  national referral center engaged in substantial programs of 
  1.23  patient care, medical research, and medical education meeting 
  1.24  state and national needs that receives more than 40 percent of 
  1.25  its patients from outside the state of Minnesota; 
  2.1      (2) a project for construction or modification for which a 
  2.2   health care facility held an approved certificate of need on May 
  2.3   1, 1984, regardless of the date of expiration of the 
  2.4   certificate; 
  2.5      (3) a project for which a certificate of need was denied 
  2.6   before July 1, 1990, if a timely appeal results in an order 
  2.7   reversing the denial; 
  2.8      (4) a project exempted from certificate of need 
  2.9   requirements by Laws 1981, chapter 200, section 2; 
  2.10     (5) a project involving consolidation of pediatric 
  2.11  specialty hospital services within the Minneapolis-St. Paul 
  2.12  metropolitan area that would not result in a net increase in the 
  2.13  number of pediatric specialty hospital beds among the hospitals 
  2.14  being consolidated; 
  2.15     (6) a project involving the temporary relocation of 
  2.16  pediatric-orthopedic hospital beds to an existing licensed 
  2.17  hospital that will allow for the reconstruction of a new 
  2.18  philanthropic, pediatric-orthopedic hospital on an existing site 
  2.19  and that will not result in a net increase in the number of 
  2.20  hospital beds.  Upon completion of the reconstruction, the 
  2.21  licenses of both hospitals must be reinstated at the capacity 
  2.22  that existed on each site before the relocation; 
  2.23     (7) the relocation or redistribution of hospital beds 
  2.24  within a hospital building or identifiable complex of buildings 
  2.25  provided the relocation or redistribution does not result in: 
  2.26  (i) an increase in the overall bed capacity at that site; (ii) 
  2.27  relocation of hospital beds from one physical site or complex to 
  2.28  another; or (iii) redistribution of hospital beds within the 
  2.29  state or a region of the state; 
  2.30     (8) relocation or redistribution of hospital beds within a 
  2.31  hospital corporate system that involves the transfer of beds 
  2.32  from a closed facility site or complex to an existing site or 
  2.33  complex provided that:  (i) no more than 50 percent of the 
  2.34  capacity of the closed facility is transferred; (ii) the 
  2.35  capacity of the site or complex to which the beds are 
  2.36  transferred does not increase by more than 50 percent; (iii) the 
  3.1   beds are not transferred outside of a federal health systems 
  3.2   agency boundary in place on July 1, 1983; and (iv) the 
  3.3   relocation or redistribution does not involve the construction 
  3.4   of a new hospital building; 
  3.5      (9) a construction project involving up to 35 new beds in a 
  3.6   psychiatric hospital in Rice county that primarily serves 
  3.7   adolescents and that receives more than 70 percent of its 
  3.8   patients from outside the state of Minnesota; 
  3.9      (10) a project to replace a hospital or hospitals with a 
  3.10  combined licensed capacity of 130 beds or less if:  (i) the new 
  3.11  hospital site is located within five miles of the current site; 
  3.12  and (ii) the total licensed capacity of the replacement 
  3.13  hospital, either at the time of construction of the initial 
  3.14  building or as the result of future expansion, will not exceed 
  3.15  70 licensed hospital beds, or the combined licensed capacity of 
  3.16  the hospitals, whichever is less; 
  3.17     (11) the relocation of licensed hospital beds from an 
  3.18  existing state facility operated by the commissioner of human 
  3.19  services to a new or existing facility, building, or complex 
  3.20  operated by the commissioner of human services; from one 
  3.21  regional treatment center site to another; or from one building 
  3.22  or site to a new or existing building or site on the same 
  3.23  campus; or 
  3.24     (12) the construction or relocation of hospital beds 
  3.25  operated by a hospital having a statutory obligation to provide 
  3.26  hospital and medical services for the indigent that does not 
  3.27  result in a net increase in the number of hospital beds.; or 
  3.28     (13) the redistribution of hospital beds within a hospital 
  3.29  building or identifiable complex of buildings to a new hospital 
  3.30  located within the same building or identifiable complex of 
  3.31  buildings if: 
  3.32     (i) the hospital from which the beds are redistributed has 
  3.33  a licensed capacity of over 400 beds; 
  3.34     (ii) the number of beds redistributed to the new hospital 
  3.35  does not exceed 30; 
  3.36     (iii) the number of licensed beds in the hospital from 
  4.1   which the beds are redistributed is reduced by 50, exclusive of 
  4.2   the beds redistributed; 
  4.3      (iv) the patients to be served by the new hospital will 
  4.4   need hospital care and will possess the clinical characteristics 
  4.5   of patients assignable to diagnostic categories under Medicare's 
  4.6   diagnosis related group system; 
  4.7      (v) the new hospital will qualify, after satisfaction of 
  4.8   any Medicare-required waiting period, for an exclusion from the 
  4.9   Medicare prospective payment system as a long-term care hospital 
  4.10  pursuant to section 1886(d)(1)(B)(iv) of Title XVIII of the 
  4.11  Social Security Act; 
  4.12     (vi) the new hospital agrees, under the medical assistance 
  4.13  and general assistance medical care programs, to payment as an 
  4.14  acute care hospital and to forego any positive difference in 
  4.15  inpatient rates over acute care hospital rates that would 
  4.16  otherwise be associated with its designation as a long-term care 
  4.17  hospital, including those rates specified under section 256.969, 
  4.18  subdivision 25; 
  4.19     (vii) the result of the redistribution is not an increase 
  4.20  in the number of licensed hospital beds in this state; and 
  4.21     (viii) the new hospital complies with the applicable 
  4.22  provisions of sections 144.50 to 144.55 and any applicable rules 
  4.23  adopted thereunder.