To repeal sections 197.305, 197.317 and 197.318, RSMo Supp. 1996, relating to certain institutional health care services, and to enact in lieu thereof three new sections relating to the same subject.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF MISSOURI, AS FOLLOWS:

     Section A. Sections 197.305, 197.317 and 197.318, RSMo Supp. 1996, are repealed and three new sections enacted in lieu thereof, to be known as sections 197.305, 197.317 and 197.318, to read as follows:

     197.305. As used in sections 197.300 to 197.366, the following terms mean:

     (1) "Affected persons", the person proposing the development of a new health care service, the public to be served, the health systems agency and health care facilities within the service area in which the proposed new health care service is to be developed;

     (2) "Agency", the state health planning and development agency of the Missouri department of health;

     (3) "Capital expenditure", an expenditure by or on behalf of a health care facility which, under generally accepted accounting principles, is not properly chargeable as an expense of operation and maintenance;

     (4) "Certificate of need", a written certificate issued by the committee setting forth the committee's affirmative finding that a proposed project sufficiently satisfies the criteria prescribed for such projects by sections 197.300 to 197.366;

     (5) "Continuing care retirement community", a continuing care retirement community provides at the same site or location independent housing, long-term health care and other services to older persons not related by blood or marriage to the owner or operator of the continuing care retirement community under an agreement effective for the life of the person or a specified period of time in excess of one year which guarantees or provides priority access to on-site health related long-term care services when needed;

     (6) "Develop", to undertake those activities which on their completion will result in the offering of a new institutional health service or the incurring of a financial obligation in relation to the offering of such a service;

     (7) "Expenditure minimum" shall mean:

     (a) For health care facilities licensed under chapter 198, RSMo, and long-term care beds in a hospital as described in subdivision (3) of subsection 1 of section 198.012, RSMo, six hundred thousand dollars in the case of capital expenditures, or four hundred thousand dollars in the case of major medical equipment and new institutional health services as described in subdivision (12), paragraphs (a), (b), (c), (d), (e), (f), and (g), unless such sum exceeds federal regulations;

     (b) For beds or equipment used to provide twenty-four hour accommodations, board and basic or skilled nursing care and treatment services or beds in a long-term care hospital meeting the requirements described in 42 C.F.R., section 412.23(e), the expenditure minimum shall be zero. Nothing in this paragraph shall change or alter the exceptions in paragraphs (e) and (g) of subdivision (12) of this section; and

     (c) For health care facilities or beds not described in paragraph (a) or (b) of this subdivision one million dollars in the case of capital expenditures and one million dollars in the case of medical equipment;

     (8) "Health care facilities", hospitals, health maintenance organizations, tuberculosis hospitals, psychiatric hospitals, professional nursing facilities, practical nursing facilities, [residential care facilities I and II,] kidney disease treatment centers, including free standing hemodialysis units, and ambulatory surgical facilities, but excluding the private offices of physicians, dentists and other practitioners of the healing arts, and Christian Science sanatoriums, also known as Christian Science Nursing facilities listed and certified by the Commission for Accreditation of Christian Science Nursing Organization/Facilities, Inc., and facilities of not for profit corporations in existence on October 1, 1980, subject either to the provisions and regulations of section 302 of the Labor-Management Relations Act, 29 U.S.C. 186 or the Labor-Management Reporting and Disclosure Act, 29 U.S.C. 401-538[, and any residential care facility I or residential care facility II operated by a religious organization qualified under section 501(c)(3) of the federal Internal Revenue Code, as amended, which does not require the expenditure of public funds for purchase or operation, with a total licensed bed capacity of one hundred beds or fewer];

     (9) "Health service area", a geographic region appropriate for the effective planning and development of health services, determined on the basis of factors including population and the availability of resources, consisting of a population of not less than five hundred thousand or more than three million;

     (10) "Health systems agency", a regional health planning agency established pursuant to PL 93-641 and, after December 31, 1981, in accordance with section 1512(b)(1)(B) thereof;

     (11) "Major medical equipment", medical equipment used for the provision of medical and other health services;

     (12) "New institutional health service":

     (a) The development of a new health care facility;

     (b) The acquisition, including acquisition by lease, of any health care facility, or major medical equipment costing in excess of the expenditure minimum;

     (c) Any capital expenditure by or on behalf of a health care facility in excess of the expenditure minimum;

     (d) Predevelopment activities as defined in subdivision (15) hereof costing in excess of one hundred fifty thousand dollars;

     (e) Any change in licensed bed capacity of a health care facility which increases the total number of beds by more than ten or more than ten percent of total bed capacity, whichever is less, over a two-year period;

     (f) Health services, excluding home health services, which are offered in a health care facility and which were not offered on a regular basis in such health care facility within the twelve-month period prior to the time such services would be offered;

     (g) A reallocation by an existing health care facility of licensed beds among major types of service or reallocation of licensed beds from one physical facility or site to another by more than ten beds or more than ten percent of total licensed bed capacity, whichever is less, over a two-year period;

     (13) "Nonsubstantive projects", projects which do not involve the addition, replacement, modernization or conversion of beds or the provision of a new health service but which include a capital expenditure which exceeds the expenditure minimum and are due to an act of God or a normal consequence of maintaining health care services, facility or equipment;

     (14) "Person", any individual, trust, estate, partnership, corporation, including associations and joint stock companies, state or political subdivision or instrumentality thereof, including a municipal corporation;

     (15) "Predevelopment activities", expenditures for architectural designs, plans, working drawings and specifications, and any arrangement or commitment made for financing; but excluding submission of an application for a certificate of need.

     197.317. After July 1, 1983, no certificate of need shall be issued for the following:

     (1) Additional [residential care facility I, residential care facility II,] intermediate care facility or skilled nursing facility beds above the number then licensed by this state;

     (2) Beds in a licensed hospital to be reallocated on a temporary or permanent basis to nursing care or beds in a long-term care hospital meeting the requirements described in 42 C.F.R., section 412.23(e), excepting those which are not subject to a certificate of need pursuant to paragraphs (e) and (g) of subdivision (12) of section 197.305; nor

     (3) The reallocation of intermediate care facility or skilled nursing facility beds of existing licensed beds by transfer or sale of licensed beds between a hospital licensed under this chapter or a nursing care facility licensed under chapter 198, RSMo; except for beds in counties in which there is no existing nursing care facility. No certificate of need shall be issued for the reallocation of existing [residential care facility I or II, or] intermediate care facilities operated exclusively for the mentally retarded to intermediate care or skilled nursing facilities or beds. However, after July 1, 1999, nothing in this section shall prohibit the Missouri health facilities review committee from issuing a certificate of need for additional beds in existing health care facilities or for new beds in new health care facilities or for the reallocation of licensed beds, provided that no construction shall begin prior to July 1, 2000. The provisions of subsections 16 and 17 of section 197.315 shall apply to the provisions of this section.

     197.318. 1. The provisions of section 197.317 shall not apply to [a residential care facility I, residential care facility II,] an intermediate care facility or skilled nursing facility only where the department of social services has first determined that there presently exists a need for additional beds of that classification because the average occupancy of all licensed and available [residential care facility I, residential care facility II,] intermediate care facility and skilled nursing facility beds exceeds ninety percent for at least three consecutive calendar quarters, in a particular county, and within a fifteen-mile radius of the proposed facility, and the facility otherwise appears to qualify for a certificate of need. The department's certification that there is no need for additional beds shall serve as the final determination and decision of the committee. [In determining ninety percent occupancy, residential care facility I and II shall be one separate classification and intermediate care and skilled nursing facilities are another separate classification. The provisions of sections 197.300 to 197.366 shall not apply to any of the following:

     (1) A residential care facility I or residential care facility II which has received approval by the division of aging of plans for construction of such facility by August 1, 1995, and is licensed by the division of aging by August 1, 1996;

     (2) A combined skilled nursing facility and residential care facility I and II located in a tax increment financing district which has received approval by the division of aging of plans for construction of the residential care facility I and II beds by August 1, 1995;

     (3) A residential care facility I or residential care facility II which has received approval by the division of aging of plans for construction of such facility by August 1, 1995, and is located in any county of the first classification without a charter form of government with an assessed valuation of at least one billion dollars but not more than one billion five hundred million dollars;

     (4) A residential care facility I or residential care facility II which has received approval by the division of aging of plans for construction of such facility by August 1, 1995, and is located in a nursing home district which is contiguous to a public hospital district located in a county of the third classification.]

     2. The Missouri health facilities review committee may, for any facility certified to it by the department, consider the predominant ethnic or religious composition of the residents to be served by that facility in considering whether to grant a certificate of need.

     3. There shall be no expenditure minimum for facilities, beds, or services referred to in subdivisions (1), (2) and (3) of section 197.317. The provisions of this subsection shall expire December 31, 1999. Nothing in this subsection shall change or alter the exceptions described in paragraphs (e) and (g) of subdivision (12) of section 197.305.

     4. As used in this section, the term "licensed and available" means beds which are actually in place and for which a license has been issued.

     5. The provisions of section 197.317 shall not apply to any facility where at least ninety-five percent of the patients require diets meeting the dietary standards defined by section 196.165, RSMo.

     6. The committee shall review all letters of intent and applications for long-term care hospital beds meeting the requirements described in 42 C.F.R., section 412.23(e) under its criteria and standards for long-term care beds.

     7. Sections 197.300 to 197.366 shall not be construed to apply to litigation pending in state court on or before April 1, 1996, in which the Missouri health facilities review committee is a defendant in an action concerning the application of sections 197.300 to 197.366 to long-term care hospital beds meeting the requirements described in 42 C.F.R., section 412.23(e).