Hostname: page-component-cd9895bd7-lnqnp Total loading time: 0 Render date: 2024-12-24T02:22:08.811Z Has data issue: false hasContentIssue false
  • English
  • Français

Conditions on Certificates of Need: Approval at What Price?

Published online by Cambridge University Press:  27 April 2021

W. Thomas Berriman
Get access Rights & Permissions [Opens in a new window]

Extract

Providers and health planning agencies familiar with the federaily mandated Section 1122 and certificate of need (CON) programs had mixed reactions to the passage of the 1979 amendments to the National Health Planning and Resources Development Act (the 1979 Planning Act Amendments), especially the addition of Section 1527 which prescribes specific federal requirements for state CON programs. One of the most controversial provisions of Section 1527 is the so-called conditions amendment, often referred to as the “Satterfield amendment.” The conditions amendment has crystalized by statute a power that many planning agencies had previously assumed and that most hospitals had feared: state health planning and development agencies (SHPDAs) have the legal authority to issue CONs subject to conditions that require applicants to undertake actions unrelated to those for which they sought approval. At the same time, however, the conditions amendment vindicates a notion long held by providers and rejected by some planning agencies: the SHPDA's conditioning power is not unlimited; while some conditions are permissible, others are not.

Type
Article
Information
Law, Medicine and Healthcare , Volume 9 , Issue 4 , December 1981 , pp. 4 - 10
Copyright
Copyright © American Society of Law, Medicine and Ethics 1981

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Section 1122 of the Social Security Act Amendments of 1972, 42 U.S.C. §1320a-I.Google Scholar
State health planning and development agencies (SHPDAs) are charged to administer state certificate of need programs by §1523(a)(4)(B) of the Public Health Service Act, 42 U.S.C. §300m-2(a)(4)(B).Google Scholar
Health Planning and Resources Development Amendments of 1979, Pub. L. No. 96-79, amending, inter alia, various sections of Title XV of the Public Health Service Act (the latter hereinafter referred to as the “Act”).Google Scholar
Section 117 of Pub. L. No. 96-79 added new §1527 to the Public Health Service Act, codified at 42 U.S.C. §300m-6.Google Scholar
Representative Satterfield, David E. III (D-Va.) was the sponsor of the bill which evolved into the conditions amendment, §1527(a)(2), 42 U.S.C. §300m-6(a)(2).Google Scholar
Horty, Hoff, An Analysis of the Satterfield Amendment to the Federal Health Planning Act: Practical Benefits to Hospitals (National Council of Community Hospitals, 1979) (hereinafter cited as “Horty-Hoff”).Google Scholar
Simpson, , Conditions on Certificate of Need Approvals: A Legal Framework and Some Practical Suggestions (Western Center for Health Planning, 1980) (hereinafter cited as “Simpson”).Google Scholar
Horty-Hoff, , supra note 6, at 2.Google Scholar
Simpson, , supra note 7, at 7, 9.Google Scholar
Section 1527(a)(2), 42 U.S.C. §300m-6(a)(2).Google Scholar
See Horty-Hoff, , supra note 6, at 2, 5–7 and Simpson, , supra note 7, at 5.Google Scholar
Horty-Hoff, , supra note 6, at 7, citing 125 Cong. Rec. H6235-36 (daily ed. July 19, 1979) (remarks of Rep. Satterfield). See also H. R. Rep. No. 96–90, 96th Cong., 1st Sess., 78 (1979) (expressing the view of the Interstate and Foreign Commerce Committee that such conditions “are not appropriate”).Google Scholar
Horty-Hoff, , supra note 6, at 6.Google Scholar
Id. at 5.Google Scholar
Simpson, , supra note 7, at 4–5 (noting contexts other than health planning in which conditional approvals are a “familiar tool of administrative agency procedure”).Google Scholar
Id. at 5, citing 125 Cong. Rec. H6237 (daily ed., July 19, 1979) (remarks of Rep. Preyer and Rep. Waxman).Google Scholar
Horty-Hoff, , supra note 6, at 8, referring to H. R. 3917, as reported by the Subcommittee on Health and Environment of the House Interstate and Foreign Commerce Committee; Simpson, , supra note 7, at 5.Google Scholar
Horty-Hoff, , supra note 6, at 15; Simpson, , supra note 7, at 5.Google Scholar
Simpson, , supra note 7, at 9. The test, according to Simpson, is whether the condition is or is not “based upon Federal or State law.” Id. at 5, quoting S. Rep. No. 96–309, 96th Cong., 1st Sess., 82 (1979).Google Scholar
Horty-Hoff, , supra note 6, at 16. Hence their ubiquitous reference to the conditions amendment as the “Satterfield amendment.”Google Scholar
Section 1527(a)(2)(A), 42 U.S.C. §300m-6(a)(2)(A).Google Scholar
Section 1532(c), 42 U.S.C. §300n-1(c). Should Congress subsequently amend §1532(c) to add more review criteria, those additional criteria would be permissible sources of CON conditions. This is not the case with respect to the federal regulatory criteria. See notes 30 and 31, infra, and accompanying text.Google Scholar
See generally Horty-Hoff, , supra note 6, at 20-24.Google Scholar
Id. at 21.Google Scholar
Id. at 24.Google Scholar
Simpson, , supra note 7, at 9.Google Scholar
Id. at 9-10.Google Scholar
Id. at 9.Google Scholar
Id. As an example, Simpson notes that the determination of whether a proposed specialty service would be accessible to low-income persons “depends on the accessibility of the entire facility to such persons.” Id.Google Scholar
Section 1527(a)(2)(B), 42 U.S.C. §300m-6(a)(2)(B).Google Scholar
44 Fed. Reg. 19315, 19320 (1979), codified at 42 C.F.R., Part 122, Subpart D and Part 123, Subpart E (1979).Google Scholar
Horty-Hoff, , supra note 6, at 24-25; Simpson, , supra note 7, at 6.Google Scholar
Horty-Hoff, , supra note 6, at 24.Google Scholar
Simpson, , supra note 7, at 6.Google Scholar
Id. at 6, citing S. Ref. No. 96-309, 96th Cong., 1st Sess., 82 (1979).Google Scholar
Horty-Hoff, , supra note 6, at 25 n.13.Google Scholar
The post-Pub. L. No. 96-79 CON regulations were published as a Notice of Proposed Rulemaking at 45 Fed. Reg. 20026 (1980), and were promulgated as final regulations at 45 Fed. Reg. 69740 (1980) (These revised regulations are now codified in the 1980 edition of volume 42 of the Code of Federal Regulations).Google Scholar
In addition, the number of CON review criteria was increased from 14 to 21.Google Scholar
See Section 1527(a)(2)(B), 42 U.S.C. §300m-6(a)(2)(B).Google Scholar
The Secretary of HHS is apparently cognizant of this limitation, as evidenced by the discussion in the explanatory Appendix to the final regulations of new §123.413, dealing with “Required findings on access.” This new regulatory section provides that, where the SHPDA approves a project, but finds that the project does not satisfy the SHPDA's access criteria based on §123.412(a)(5), (6), the SHPDA “may … impose the condition that the applicant take affirmative steps to meet those criteria.” 45 Fed. Reg. at 69754, 42 C.F.R. §123.413(b). Apparently in response to public comments received following the NPRM questioning the validity of the provision for affirmative action access-related conditions, the Secretary clarified that this provision “gives planning agencies no more authority than they have under the Act” and that such conditions are “discretionary” with the States. 45 Fed. Reg. at 69773.Google Scholar
Section 1527(a)(2)(C), 42 U.S.C. §300m-6(a)(2)(C).Google Scholar
Horty-Hoff, , supra note 6, at 26.Google Scholar
Id.Google Scholar
Id. at 26-29 (relying on the phrase “an authorization prescribed by State law”).Google Scholar
Id. at 29-31 (relying on the phrase “prescribed by regulation by the State Agency”).Google Scholar
Id. at 31-32, citing the last sentence of §1527(a)(2), 42 U.S.C. §300m-6(a)(2).Google Scholar
Simpson, , supra note 7, at 7 n.19.Google Scholar
Id.Google Scholar
Id.Google Scholar
See 43 Fed. Reg. 11229-41 (1978); 43 Fed. Reg. 21273-82 (1978).Google Scholar
Simpson, , supra note 7, at 5.Google Scholar
Horty-Hoff, , supra note 6, at 7, 10 (characterizing such a condition as one of the “abuses” the conditions amendment was designed to prevent). Consider, however, whether a condition requiring a change in the governing body of a hospital would be valid if it were lawfully promulgated by the SHPDA pursuant to subparagraph (C).Google Scholar
See §1532(c)(3), 42 U.S.C. §300n-1(c)(3), and 42 C.F.R. §123.409(a)(3)(i) (referring to “the need that the population served or to be served” has for the proposed services).Google Scholar
Simpson, , supra note 7, at 8.Google Scholar
Id., citing 42 C.F.R. §123-409(a)(3)(i).Google Scholar
Horty-Hoff, , supra note 6, at 13.Google Scholar
Id. at 19.Google Scholar
Id. at 2, 5.Google Scholar
Id. at 12, 15, 26.Google Scholar
Simpson, , supra note 7, at 10, citing 42 C.F.R. §123.409(a)(5).Google Scholar
Simpson, , supra note 7, at 10.Google Scholar
Horty-Hoff, , supra note 6, at 20-24.Google Scholar
42 C.F.R. §123.409(a)(8).Google Scholar
Horty-Hoff, , supra note 6, at 24-25.Google Scholar
See §1532(c)(1), 42 U.S.C. §300n-1(c)(1) and 42 C.F.R. §123.409(a)(1).Google Scholar
See generally Simpson, , supra note 7, at 10-11, 13–20.Google Scholar
Horty-Hoff, , supra note 6, at 14.Google Scholar
Id. at 14-15.Google Scholar
Simpson, , supra note 7, at 1.Google Scholar