Certificate of Need - Modifications

In the 2019 Session, the General Assembly passed Senate Bill 940/House Bill 931 (Sen. Klausmeier and Del. Kipke), Health Care Facilities - Certificate of Need - Modifications.  The Governor signed Senate Bill 940 (now Chapter 474 of the Acts of 2019) on May 13, 2019.

This bill, along with 2 others (House Bill 626 and House Bill 646), was the result of a workgroup formed over the past interim at the request of House Health and Government Operations Chair Shane Pendergrass and then-Senate Finance Chair Mac Middleton, to look at how the current Certificate of Need (CON) process could be streamlined and made more effective.

The bill makes three primary changes:

1 - The definition of an ambulatory surgical facility owned by one or more health care practitioners or a group practice is changed to a center with 3 or more operating rooms; under current law the term was defined as a center with 2 or more operating rooms.  The establishment of an ASF requires a lengthy and costly CON process.  Under the current definition, a CON is not needed for an ASF with one operating room; the bill changes that to allow for a facility with 2 operating rooms to be established without a CON.

2 - The "capital threshold" is eliminated for these facilities.  Under current law, a CON is needed, generally speaking, if a non-hospital facility pursues a project to acquire, renovate, or expand a facility involving capital expenditures of $5 million or more, regardless of whether the facility is offering new services or substantially changes bed capacity.  Now, the CON will only be required if new services are offered or bed capacity is substantially changed.

3 - Senate Bill 940 now deems most uncontested CON applications as being approved if the Maryland Health Care Commission does not act on the application within 120 days of the application being docketed.  This does not apply to an application for the establishment of a health care facility, the relocation of a health care facility, or the establishment of cardiac or organ transplant services at a hospital.

 The bill will take effect on October 1, 2019.