AB925: Bill Text

AB925,25,6 (4) No hospital or physician may be paid for a service that a utilization review program under this section determines is medically unnecessary or inappropriate. If the hospital or physician has already been paid, the hospital or physician shall reimburse the payer within 30 days. The commission may commence an action to enforce this subsection in the circuit court for the county in which the hospital is located.

AB925,25,10 150.665 Enforcement and penalties. (1) (a) Until the commission establishes different rates under this subchapter, no hospital may charge any payer an amount exceeding the rates in effect as of the effective date of this paragraph .... [revisor inserts date].

AB925,25,18 (b) The attorney general may petition a court to enforce compliance with par. (a) and s. 150.612 (2) if the attorney general first notifies the hospital and provides the hospital a reasonable time to correct the violation. The commission may petition a court to enforce compliance with any statutory requirement or with any rule or order of the commission if it first notifies the hospital and provides the hospital a reasonable time to correct the violation. The commission shall commence any action under this paragraph in the circuit court for the county in which the hospital is located.

AB925,25,21 (c) A hospital that intentionally violates s. 150.612 (2) may be subject to a forfeiture of up to $5,000. Each week that a hospital intentionally violates s. 150.612 (2) is a separate violation.

AB925,25,24 (2) Any person who intentionally violates an order of a hearing examiner issued under s. 227.46 (7) to protect trade secrets in a contested case brought under this subchapter shall be subject to a forfeiture of $5,000.

AB925,26,4 150.67 Annual adjustments. The commission shall adjust annually the limits on gross annual patient revenue in ss. 150.63 (2) (b) and 150.65 (2) (a) and (3) to reflect annual changes in the average of the consumer price index and the hospital market basket index.

AB925,26,13 150.68 Assessments. Beginning July 1, 2002, the commission shall, within 90 days after the beginning of each fiscal year, estimate the total amount of revenue required for administration by the commission of this subchapter during that fiscal year and assess that estimated total amount to hospitals in proportion to each hospital's respective gross private-pay patient revenues during the hospital's most recently concluded fiscal year. The commission shall promulgate rules to establish the rate of the assessments under this section. Each hospital shall pay the assessment by December 1 of the year in which the assessment is made. The assessments shall be credited to the appropriation account under s. 20.438 (1) (g).

AB925,26,17 150.71 Approval required. (1) Beginning on the effective date of this subsection .... [revisor inserts date], no person may do any of the following unless the person applies for and receives the department's approval as specified under this subchapter:

AB925,26,21 (a) Except as provided in s. 150.713 and subject to sub. (2), by or on behalf of a hospital, obligate for a capital expenditure more than $1,000,0000, unless the capital expenditure is to convert a hospital to a new use or to renovate part or all of a hospital.

AB925,26,24 (b) Except as provided in s. 150.713 and subject to sub. (2), by or on behalf of a hospital, obligate for a capital expenditure more than $1,500,000 to convert a hospital to a new use or to renovate part or all of a hospital.

AB925,27,3 (c) Implement an organ transplant program, a burn center, a neonatal intensive care program, a cardiac program, or air transport services or add psychiatric or chemical dependency beds.

AB925,27,4 (d) Purchase or otherwise acquire a hospital.

AB925,27,5 (e) Construct or operate an ambulatory surgery center or a home health agency.

AB925,27,12 (2) The cost of studies, surveys, plans, and other activities essential to a proposed capital expenditure specified under sub. (1) (a) or (b) shall be included in determining the value of the capital expenditure. A capital expenditure includes any donation of equipment or facilities that, if acquired directly, would be subject to review under this subchapter and any transfer of equipment or facilities for less than fair market value that, if transferred at fair market value, would be subject to review under this subchapter.

AB925,27,17 150.713 Exceptions. (1) A person who has, prior to the effective date of this subsection .... [revisor inserts date], entered into a legally enforceable contract, promise, or agreement to do any of the activities specified in s. 150.71 (1), is not required to apply for or receive the department's approval under this subchapter to do any of the activities agreed to in the contract, promise, or agreement.

AB925,27,23 (2) A person may obligate for a capital expenditure, by or on behalf of a hospital, without first obtaining the department's approval under this subchapter, not more than 20% of the hospital's gross annual patient revenue for its last fiscal year if the expenditure is for heating, air conditioning, ventilation, electrical systems, energy conservation, telecommunications, computer systems, or nonsurgical outpatient services and is not a component of another project specified in s. 150.71 (1).

AB925,28,2 (3) A person who receives an exemption from the department under s. 150.715 is not required to apply for or receive the department's approval to obligate a capital expenditure on behalf of a hospital or to make a substantial change in a health service as specified in the exemption.

AB925,28,3 150.715 Innovative medical technology exemption. (1) In this section:

AB925,28,8 (a) "Clinical trial" means clinical research conducted under approved protocols in compliance with federal requirements that are applicable to investigations involving human subjects, including the requirements for an informed consent advising the patient clearly of the risks associated with participating in the clinical research.

AB925,28,11 (b) "Innovative medical technology" means equipment or procedures that are potentially useful for diagnostic or therapeutic purposes and that introduce new technology in the diagnosis and treatment of an illness.

AB925,28,15 (2) The department may grant any person who intends to undertake a capital expenditure of more than $500,000, or who intends to make a substantial change in a health service, an exemption from the requirements of s. 150.71 if the person meets all of the following requirements:

AB925,28,19 (a) The capital expenditure or substantial change in a health service is for the research, development, and evaluation of innovative medical technology, the development of clinical applications of the technology, or the research, development, and evaluation of a major enhancement to existing medical technology.

AB925,28,20 (b) The person submits an application for an exemption to the department.

AB925,28,24 (c) The person demonstrates that, prior to applying for an exemption, preliminary animal studies or preliminary clinical investigations establish that the innovative medical technology or major enhancement to existing medical technology has a reasonable probability of advancing clinical diagnosis or therapy.

AB925,29,3 (d) In developing and evaluating the clinical applications of the technology or research, the person uses scientifically sound studies to determine clinical efficacy, safety, cost-effectiveness, and appropriate utilization levels in a clinical setting.

AB925,29,7 (e) The person conducts the clinical trials, evaluation, or research according to scientifically sound protocols that are subject to peer review and approval and meets the requirements that are applicable to investigations and clinical evaluation involving human subjects.

AB925,29,9 (f) The innovative medical technology will be used to conduct necessary research, development, and evaluation.

AB925,29,18 (g) The person does not include any recovery of capital expenses that are incurred as part of the capital expenditure or substantial change in a health service exempted under this section in the expense and revenue budget for purposes of rate setting under ss. 150.61 to 150.68 until after the person receives the approval of the federal food and drug administration and the department for general medical use of the innovative medical technology or major enhancement to existing medical technology. The person may recover operating expenses only after the federal food and drug administration approves the expenses for safety and efficacy and a third party agrees to pay for the expenses.

AB925,29,21 (3) No more than 2 exemptions may be granted under this section for each type of innovative medical technology and major enhancement to existing medical technology.

AB925,30,2 150.717 Notification requirement. A person who intends to undertake an activity specified in s. 150.71 (1) shall notify the department in writing at least 30 days prior to submitting an application for review. An application expires one year from the date the applicant notifies the department under this section unless the department declares the application complete as provided under s. 150.719 (1).

AB925,30,10 150.719 Review requirements. (1) The department's review of an application begins on the date that a completed application is received. On or before the 20th day of the month that immediately follows the receipt of a completed application, the department shall send a notice of receipt of the completed application to the applicant and shall publish a class 2 notice under ch. 985 in a daily newspaper with general circulation in the area where the proposed activity will be located. No application for review that is received from a hospital is complete until the commission receives a proposed capital budget under s. 150.73.

AB925,30,20 (2) The department may group applications for the same or similar types of facilities or services or for activities that are proposed within the same health planning area, as defined by the department under s. 150.33 (1), for concurrent review. The department shall base its review under this subsection on a comparative analysis of the applications, using the criteria specified in s. 150.72 and a ranking of priorities determined by the department. In reviewing an application, the department shall first consider cost containment in applying the criteria under s. 150.72 (1) and shall also consider the comments of any affected parties. The department shall promulgate rules specifying the requirements for review under this subsection.

AB925,30,24 150.72 Review criteria. (1) No application for an activity specified in s. 150.71 (1) (a) to (e) may be approved by the department unless the applicant proves by a preponderance of the evidence that each of the following criteria has been met or does not apply to the activity:

AB925,31,2 (a) The activity is consistent with the state medical facilities plan adopted under s. 150.733.

AB925,31,4 (b) A need for the activity, as determined by current and projected utilization, exists.

AB925,31,7 (c) The activity will efficiently and economically use resources, including financing for capital investment and operating expenses, when measured against alternative use of resources.

AB925,31,9 (d) The applicant has sufficient cash reserves and cash flow to pay operating and capital costs.

AB925,31,15 (e) Increases in operating and capital costs that will result from the activity are reasonable, including the direct charge to the consumer, the applicant's projected request for rate increases under ss. 150.61 to 150.67, and the charges to be paid by medical assistance and disability insurers. In considering whether the increases are reasonable, the department shall consider the analysis provided by the commission under sub. (2).

AB925,31,16 (f) Financing for the activity is available at market rates.

AB925,31,18 (g) Health care personnel needed to provide the proposed services are available and will be effectively used.

AB925,31,19 (h) Proposed construction costs are consistent with industry averages.

AB925,31,21 (i) Any proposed expansion and construction or renovation alternatives are cost-effective.

AB925,31,22 (j) The activity is consistent with efficiency standards and criteria.

AB925,32,3 (k) The applicant is participating in a utilization review program that is applicable to a statistical sampling of all hospital patients regardless of payment source, that requires public disclosure of all review data in a form useful to the department but protects the identities of individual patients and health care professionals, and that is conducted by persons who are free of any substantial conflict of interest.

AB925,32,5 (L) The applicant has prepared a plan to provide health care to low-income individuals, and the department has approved the plan.

AB925,32,8 (2) The commission shall determine the effect of any rate change the applicant has requested on the applicant's activity and provide a report to the department no later than 45 days after the department receives a completed application.

AB925,32,13 150.723 Review process. (1) Upon the request of an affected party, the department shall hold a public meeting to review activities for which an application for review has been received. All affected parties may present testimony at the public meeting. The department shall keep minutes or other record of testimony presented at the public meeting.

AB925,32,21 (2) (a) The department shall issue an initial finding to approve or reject the application no later than 75 days after the date on which the notice under s. 150.719 (1) is published unless the applicant consents to an extension of this period. The department may not require substantial modifications of any project as a condition of approval without the applicant's consent. The department shall submit the initial finding to the applicant. Unless the applicant makes a timely request for a hearing under sub. (3), an initial finding issued under this subsection shall be considered a final action.

AB925,32,25 (b) Notwithstanding par. (a), the department may extend the review period of all projects being reviewed concurrently for 60 days if the department finds that completing the review within the 75-day time period under par. (a) is not practical due to the number of applications under review.

AB925,33,7 (3) (a) If an applicant's application is rejected, the applicant may request a public hearing to review the department's initial finding if the applicant submits a request for the hearing in writing no later than 10 days after the department issues the initial finding or the applicant may initiate a hearing under s. 227.42. The department shall commence the hearing no later than 30 days after the date on which a timely request for the hearing is received unless all parties consent to an extension of the period.

AB925,33,10 (b) Except as provided in s. 227.42, ss. 227.43 to 227.50 do not apply to hearings under this subsection. The department shall promulgate rules specifying all of the following:

AB925,33,11 1. Procedures for scheduling hearings under this subsection.

AB925,33,14 2. Procedures for conducting hearings under this subsection, including methods of presenting arguments, cross-examination of witnesses, and submission of exhibits.

AB925,33,16 3. Procedures following the completion of a hearing under this subsection, including the establishment of time limits for issuance of a decision.

AB925,33,18 4. Standards relating to ex parte communication in hearings under this subsection.

AB925,33,19 5. Procedures for reconsideration and rehearing.

AB925,33,20 (c) The department shall issue all decisions in writing.

AB925,33,23 (d) Each applicant has the burden of proving, by clear and convincing evidence, that the department's initial finding was arbitrary and capricious, contrary to law, or contrary to the weight of the evidence on the record when considered as a whole.

AB925,34,2 150.725 Judicial review. An applicant adversely affected by a decision of the department under s. 150.723 (3) may petition for judicial review of the decision under s. 227.52. The scope of judicial review shall be as provided in s. 227.57, and the record before the reviewing court shall consist of all of the following:

AB925,34,4 (1) The application and all supporting material received prior to the department's initial finding issued under s. 150.723 (2)

AB925,34,5 (2) The record of the public meeting held under s. 150.723 (1).

AB925,34,7 (3) The department's analysis of the activity and the activity's compliance with the criteria specified in s. 150.72 (1).

AB925,34,8 (4) The record of the hearing held under s. 150.723 (3).

AB925,34,9 (5) The department's decisions and analysis issued under s. 150.723 (2) or (3).

AB925,34,12 150.727 Validity and contents of an approval. (1) An approval is valid for one year from the date of issuance. The department may grant one extension of up to 6 months for each approval.

AB925,34,14 (2) Each approval shall specify the maximum capital expenditure that may be obligated for an activity.

AB925,34,19 (3) Each approval shall include the proposed timetable for implementing and completing the project and, for the 3-year period following completion of the activity, the activity's depreciation and interest schedule, any required staff, the proposed per diem rate needed to pay capital costs, and the proposed per diem rate needed to pay operating costs.

AB925,34,25 150.73 Capital budget reporting. Beginning January 1, 2003, each hospital shall annually, by January 1, submit to the department a proposed capital budget for the 5-year period that begins on July 1 of the year in which the proposed budget is submitted. The budget shall specify all anticipated capital expenditures for activities specified in s. 150.71 (1) (a) to (c) and (e) and all anticipated application dates.

AB925,35,6 150.733 State medical facilities plan. (1) The department shall adopt a state medical facilities plan at least once every 3 years that includes a description of the state hospital system and identifies any needed or surplus hospital beds. Each plan, except the initial plan adopted under this subsection, shall also include a description of needed and surplus health services and any other comments the department determines are useful.

AB925,35,11 (2) The department may not approve an application for any activity that requires the addition of hospital beds that would exceed the number of beds authorized by the state medical facilities plan for the acute care service area where the project would be located. The department shall promulgate rules to define an acute care service.

AB925, s. 10 Section 10. 153.08 of the statutes is repealed.

AB925, s. 11 Section 11. 153.75 (1) (g) of the statutes is repealed.

AB925, s. 12 Section 12. 165.40 of the statutes is repealed.

AB925, s. 13 Section 13. 230.08 (2) (mp) of the statutes is created to read:

AB925,35,17 230.08 (2) (mp) One staff director of the hospital rate-setting commission, created under s. 15.105 (27).

AB925, s. 14 Section 14. 632.75 (5) of the statutes is amended to read:

AB925,35,22 632.75 (5) Payments for hospital services. No insurer may reimburse a hospital for patient health care costs at a rate exceeding the rate established under ch. 54, 1985 stats., or s. 146.60, 1983 stats., for care provided prior to July 1, 1987 ss. 150.61 to 150.67.

AB925, s. 15 Section 15. Nonstatutory provisions.

AB925,36,2 (1) Initial appointment of members of the hospital rate-setting commission. Notwithstanding the length of terms specified for the members of the hospital rate-setting commission under section 15.105 (27) of the statutes, as created by this act, the initial members shall be appointed for the following terms:

AB925,36,3 (a) One member for a term expiring on March 1, 2005.

AB925,36,4 (b) One member for a term expiring on March 1, 2007.

AB925,36,5 (c) One member for a term expiring on March 1, 2009.

AB925,36,9 (2) Initial appointment of members of the hospital rate-setting council. Notwithstanding the length of terms specified for the members of the hospital rate-setting council under section 15.107 (18) of the statutes, as created by this act, the initial members shall be appointed for the following terms:

AB925,36,11 (a) The members specified under section 15.107 (18) (a) of the statutes, as created by this act, for terms expiring on July 1, 2003.

AB925,36,14 (b) The members specified under section 15.107 (18) (b) and (d) of the statutes, as created by this act, and the members not specified in section 15.107 (18) (a) to (e) of the statutes, as created by this act, for terms expiring on July 1, 2005.

AB925,36,16 (c) The members specified under section 15.107 (18) (c) and (e) of the statutes, as created by this act, for terms expiring on July 1, 2007.

AB925,36,22 (3) Request to supplement appropriation. By April 1, 2002, the hospital rate-setting commission shall submit to the secretary of administration a request to supplement the appropriation under section 20.438 (1) (g) of the statutes, as created by this act, as specified under section 16.515 of the statutes. The request shall include a proposed budget for activities of the hospital rate-setting commission under subchapter III of chapter 150 of the statutes, as created by this act.

AB925,36,23 (4) Hospital rate-setting commission rules.

AB925,37,2 (a) The hospital rate-setting commission shall submit proposed rules required under section 150.615 of the statutes, as created by this act, to the legislative council staff for review under section 227.15 (1) of the statutes no later than May 1, 2002. These rules may not take effect before July 1, 2002.