Section 1 (144.551, subdivision 1) adds an exception to the hospital construction moratorium for any projects that are eventually approved under section 3.

Section 2 (144.552) modifies the requirement that an entity seeking a moratorium exception must submit a plan to the Minnesota Department of Health (MDH) for a public interest review. This section requires a plan submission from an organization seeking to obtain a new hospital license only in cases where the organization has been notified by MDH under section 3 that it is subject to the requirement for a public interest review. This section also requires MDH to conduct a public hearing as part of the review process.

Section 3 (144.553) establishes an alternative approval process for moratorium exceptions.

Subdivision 1 requires an organization seeking a new hospital license to submit a letter of intent to MDH, specifying the location and number of beds for the proposed hospital. MDH must publish a notice giving other interested organizations 30 days to notify MDH that they are also interested in obtaining a hospital license to serve the same area. If no other organizations express interest, MDH must notify the original entity that it is subject to a public interest review.

Subdivision 2 requires MDH to conduct a needs assessment on the proposed new hospital if one or more additional organizations responds to the original letter of intent. The commissioner must make a determination of need within 90 days, and each interested organization must provide to MDH sufficient information to allow MDH to make this determination. If MDH determines the new hospital is not needed, the agency must notify the applicants.

Subdivision 3 requires MDH, if it determines that a new hospital is needed, to do the following:

select the applicant best able to provide services consistent with the review criteria established in this subdivision;

determine market-specific criteria regarding access, quality, cost, and feasibility, and other criteria at the agency's discretion. In developing other criteria, MDH must consider the need for mental health services, the need for uncompensated care, and the need for coordination with other hospitals in order to avoid duplication and to provide specialized services in adequate volume to ensure high-quality care;

define a service area for the proposed hospital. Parameters for establishing service areas are outlined in this subdivision;

publish the criteria within 60 days of the determination of need and accept proposals from the applicants for an additional 60 days;

select the most qualified applicant following (1) a hearing conducted by the agency or a designee, such as an administrative law judge; (2) a public hearing; and (3) consideration of input from legislators and local elected officials.

submit the recommended proposal, during the time frame outlined, to a regular session of the Legislature.

Legislative acceptance of the proposal constitutes approval of a moratorium exception. Legislative rejection concludes the process but does not prohibit a new application. In the event of a legislative failure to act, upon the conclusion of the legislative session MDH must make the agency's recommendation the final approval of the project. The terms "legislative acceptance," "legislative rejection," and "legislative failure to act" are defined.

Subdivision 4 requires the parties to any stage of the process outlined in this section to pay an equal share of the agency's expenses.

DG:rdr

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