900 KAR 6:100. Certificate of Need standards for implementation and biennial review.

 

      RELATES TO: KRS 216B.010-216B.130, 216B.330-216B.339, 216B.455, 216B.990

      STATUTORY AUTHORITY: KRS 194A.030, 194A.050, 216B.040(2)(a)1

      NECESSITY, FUNCTION, AND CONFORMITY: KRS 216B.040(2)(a)1 requires the Cabinet for Health and Family Services to administer Kentucky's Certificate of Need Program and to promulgate administrative regulations as necessary for the program. This administrative regulation establishes the required timetables and standards for implementation as well as requirements for biennial reviews for the orderly administration of the Certificate of Need Program.

 

      Section 1. Definitions. (1) "Cabinet" is defined by KRS 216B.015(5).

      (2) "Days" means calendar days, unless otherwise specified.

      (3) "Long-term care beds" means nursing home beds, intermediate care beds, skilled nursing beds, nursing facility beds, and Alzheimer nursing home beds.

      (4) "Office of Inspector General" means the office within the Cabinet for Health and Family Services that is responsible for licensing and regulatory functions of health facilities and services.

      (5) "Show cause hearing" means a hearing during which it is determined whether a person or entity has violated provisions of KRS Chapter 216B.

 

      Section 2. Standards for Implementation. (1) As a condition for the issuance of a certificate of need, a holder of a certificate of need shall submit progress reports on the OHP - Form 8, Certificate of Need Six Month Progress Report, incorporated by reference in 900 KAR 6:055, at the six (6) month intervals specified in this section.

      (2) A notice specifying the date each progress report is due shall be sent to every holder of a certificate of need whose project is not fully implemented.

      (3) The cabinet or its designee shall review a progress report and shall determine:

      (a) If the required elements have been completed; and

      (b) If the required elements have not been completed, if sufficient reasons for failure to complete have been provided.

      (4) A certificate of need shall be deemed complete if:

      (a) The project has been approved for licensure or occupancy by the Office of Inspector General; and

      (b) A final cost breakdown has been submitted.

      (5) Until a project is deemed complete by the cabinet, the cabinet may require:

      (a) The submission of additional reports as specified in subsections (16) through (18) of this section; or

      (b) Progress reports in addition to those required at six (6) month intervals under the provisions of this section.

      (6) Except for long-term care bed proposals, a certificate of need shall not be revoked for failure to complete the items required during a six (6) month period if the holder of the certificate of need establishes that the failure was due to circumstances that:

      (a) Could not reasonably be anticipated and avoided by the holder; or

      (b) Were not the result of action or inaction of the holder.

      (7) If the cabinet determines that required elements have not been completed for reasons other than those set forth in subsection (6) of this section, it shall notify the holder of the certificate of need, in writing, that it has determined to revoke the certificate of need.

      (8) The revocation shall become final thirty (30) days from the date of notice of revocation unless the holder requests a hearing pursuant to KRS 216B.086.

      (9) The first progress report for all projects other than long-term care beds shall include:

      (a) For projects for the addition of new services or expansion of existing services that do not involve construction, renovation or the installation of equipment: plans for implementation of the project;

      (b) For projects for the purchase of equipment only, a copy of the purchase order;

      (c) For projects involving the acquisition of real property, evidence of an option to acquire the site; or

      (d) For a construction or renovation project, evidence that schematic plans have been submitted to the Public Protection Cabinet, Department of Housing, Buildings, and Construction, and the Office of Inspector General.

      (10) For projects other than long-term care beds not deemed complete, a second progress report shall include:

      (a) For projects converting beds, documentation that all beds are licensed;

      (b) For projects for addition of new services or expansion of existing services that do not involve construction, renovation, or the installation of equipment, documentation of approval for licensure and occupancy by the Office of Inspector General or the Kentucky Board of Emergency Medical Services; or

      (c) For construction or renovation projects, the schedule for project completion, evidence of preliminary negotiation with a financial agency, and evidence of preliminary negotiation with contractors.

      (11) For projects other than long-term care beds not deemed complete, a third progress report shall include:

      (a) For construction or renovation projects:

      1. A copy of the deed or lease of land;

      2. Documentation of the final enforceable financing agreement, if applicable;

      3. Documentation that final plans have been submitted to the Public Protection Cabinet, Department of Housing, Buildings, and Construction, and the Office of Inspector General; and

      4. An enforceable contract with a construction contractor; or

      (b) For projects for purchase of equipment only, evidence of approval for licensure and occupancy by the Office of Inspector General.

      (12) For projects other than long-term care beds not deemed complete, a fourth progress report shall include documentation of final plan approval by the Public Protection Cabinet, Department of Housing, Buildings, and Construction, and the Office of Inspector General and evidence that construction has begun.

      (13) For projects other than long-term care beds not deemed complete, a fifth progress report shall include documentation that construction or renovation is progressing according to schedule.

      (14) For projects other than long-term care beds not deemed complete, a sixth progress report shall include documentation that the project has been approved for licensure or occupancy by the Office of Inspector General and, if required, that the appropriate license has been approved for the health care service or facility.

      (15) For projects other than long-term care beds not deemed complete after the sixth progress report, the certificate holder shall, upon request, provide the cabinet or its designee with a written statement showing cause why the certificate should not be revoked. The cabinet may defer revocation action upon a showing by the certificate holder that the project shall be completed on a revised schedule. The cabinet or its designee may require additional progress reports.

      (16) For projects involving long-term care beds:

      (a) The first progress report shall include:

      1. A copy of the deed or lease of land for projects requiring acquisition of real property; and

      2. Evidence that final plans have been submitted to the Public Protection Cabinet, Department of Housing, Buildings, and Construction, and the Office of Inspector General.

      (b) For projects involving long-term care beds not deemed complete, a second progress report shall include:

      1. For conversion of bed projects, documentation that the beds in the project are licensed; or

      2. For construction projects:

      a. A schedule for project completion with projected dates;

      b. Documentation of final financing;

      c. Documentation of final plan approval by the Public Protection Cabinet, Department of Housing, Buildings, and Construction, and the Office of Inspector General; and

      d. An enforceable construction contract.

      (17) For projects involving long-term care beds not deemed complete, a third progress report shall include documentation that construction or renovation is progressing according to the schedule for project completion.

      (18) For projects involving long-term care beds not deemed complete, a fourth progress report shall include documentation that the project has been appropriately licensed and approved for occupancy by the Office of Inspector General.

      (19) The cabinet or its designee may grant no more than three (3) additional extensions of six (6) months for good cause shown if the certificate holder of long-term care beds has failed to comply with the relevant progress report requirements established in this section.

      (20) If the project involves a capital expenditure, a final cost breakdown shall be included in the final progress report.

      (21) If the Office of Inspector General discovers a violation of terms and conditions listed on a certificate of need and license while it is conducting its annual licensure inspection, it shall refer this violation for a show cause hearing in accordance with 900 KAR 6:090, Section 4.

 

      Section 3. Biennial Review. (1) Certificate of need holders may be subject to biennial review to determine if they are in compliance with the terms as listed on their certificate of need.

      (2) Biennial review may be conducted within sixty (60) days of the second anniversary of the final progress report and at twenty-four (24) month intervals thereafter.

      (3) The cabinet or its designee shall provide sixty (60) days' advance written notification to the subject of any biennial review, including the following:

      (a) When the biennial review will be initiated;

      (b) Request for information necessary for the review to which the cabinet does not have ready access; and

      (c) A deadline for a response to the request for information.

      (4) If the cabinet finds that any of the terms and conditions of a certificate of need approval and license have been violated, the review of, and any sanctions for, this violation shall be conducted in accordance with 900 KAR 6:090, Section 4. (36 Ky.R. 250; Am. 815; eff. 10-21-2009.)