CHAPTER He-Hea 1000  ACUTE CARE FACILITIES

 

PART He-Hea 1001  PURPOSE

 

          He-Hea 1001.01  Purpose.

 

          (a)  This chapter implements a standard for the consideration of acute care facility construction, expansions, renovations and/or replacements.

 

          (b)  These standards are intended to:

 

(1)  Improve the:

 

a.  Quality of care;

 

b.  Access and availability to services; and

 

c.  Cost effectiveness of services provided, and

 

(2)  Not be detrimental to the health care system of the area.

 

Source.  #4097, eff 7-22-86; ss by #4498, eff 11-21-90; ss by #5236, eff 9-27-91 (from He-Hea 1001.02), EXPIRED: 9-27-97

 

New.  #6655, INTERIM, eff 12-18-97, EXPIRED: 4-17-98

 

New.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

PART He-Hea 1002  DEFINITIONS

 

He-Hea 1002.01  Definitions.

 

          (a)  “Acute care facility” means a hospital which cares primarily for patients having conditions or undergoing procedures which could result in severe or serious injury or diseases.

 

          (b)  “Adjusted Admission” means a calculation performed by hospitals to factor in outpatient and other hospital service activity to traditional inpatient admission totals to arrive at a total account of hospital business.

 

          (c)  “Application” means a proposal prepared by a person and filed with board for a certificate of need.

 

          (d)  “Applicant” means “applicant” as defined in RSA 151-C:2, II.

 

          (e)  “Board” means “board” as defined in RSA 151-C:3.

 

          (f)  “Capital expenditure” means a disbursement which, under generally accepted accounting principles is not properly chargeable as an expense of operation or maintenance, and includes acquisition by purchase, by transfer or by lease or comparable arrangement or through donation if the expenditure would have been considered a capital expenditure if the acquisition had been by purchase.

 

          (g)  “Certificate of need (CON)” means “certificate of need” as defined in RSA 151-C:2, VIII.

 

          (h)  “Length of stay” means the number of days a patient stays in a facility.

 

          (i)  “Market share population” means the number and/or percent of patients in a given service area utilizing a specific acute care facility.

 

          (j)  “Marshall Valuation Service (MVS)” means an appraisal guide for the development and reporting of replacement building and equipment costs used to determine construction costs of commercial buildings.

 

          (k)  “Normile methodology” means a mathematical model used to determine bed need which assumes that the incidence of need for hospital care follows a normal distribution of occurrence.

 

          (l)  “Occupancy” means the ratio of beds that is calculated by dividing the total beds occupied by the total licensed bed capacity of the hospital as licensed by the New Hampshire department of health and human services, bureau of health facilities administration.

 

          (m)  “Operating revenue” means the revenue collected from the provision of patient care services.

 

          (n)  “Patient charges” means the aggregate price charged for patient care services at a healthcare facility.

 

          (o)  “Person” means “person” as defined in RSA 151-C: 2, XXVIII.

 

          (p)  “Renovation” means a capital expenditure which repairs, remodels and/or reconfigures existing space.

 

          (q)  “Replacement” means a capital expenditure which rebuilds in whole or in part an acute care facility on a new or the original site.

 

          (r)  “Service area” means a geographic area which is served by each acute care hospital and is determined by service area boundaries extrapolated through hospital utilization patterns from a data base known as the uniform hospital discharge data system that is maintained in accordance with RSA 126:25.

 

          (s)  “Story height multiplier” means the number by which the base cost of a building is multiplied to adjust for any variation in average story height from the base of 12 feet.

 

          (t)  “Total patient days” means the sum of the number of days patients stay at a healthcare facility.

 

          (u) “Uniform hospital discharge data set (UHDDS)” means a dataset containing data from all New Hampshire hospitals that is maintained in accordance with RSA 126:25.

 

Source.  #4097, eff 7-22-86; ss by #4988, eff 11-21-90; ss by #5236, eff 9-27-91, EXPIRED: 9-27-97

 

New.  #6655, INTERIM, eff 12-18-97, EXPIRED: 4-17-98

 

New.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

PART He-Hea 1003  STANDARDS FOR EXPANSION, RENOVATION OR REPLACEMENT OF ACUTE CARE FACILITIES

 

          He-Hea 1003.01   Service Area.

 

          (a)  Service areas for each acute care hospital shall be determined by applying the DRGs common to all acute care hospitals in the state based upon the database known as the uniform hospital discharge data set maintained in accordance with RSA 126:25. 

 

          (b)  A city or town shall be part of the service area of the hospital:

 

(1)  From which a plurality of patients from the town are discharged; and

 

(2)  Is contiguous to the service area to which it is assigned.

 

          (c)  Notwithstanding He-Hea 1003.01 (b) above, in cases where the city or town is not contiguous to other towns in the hospital service area, the city or town shall be assigned to the hospital service area of the next highest plurality which is contiguous.

 

          (d)  Based upon the application of (a) through (c) above, hospital service areas shall be identified as set forth in Table 1003-1 "Service Areas by Hospital," below:

 

Table 1003-1 Service Areas By Hospital

 

ALICE PECK DAY HOSPITAL/MARY HITCHCOCK MEMORIAL HOSPITAL

 

Canaan

Hanover

Orford

Cornish

Lebanon

Springfield

Croydon

Lyme

 

Enfield

Piermont

 

Grafton

Plainfield

 

Grantham

Orange

 

 

ANDROSCOGGIN VALLEY HOSPITAL

 

Berlin

Gorham

Shelburne

Cambridge

Milan

Success

Dummer

Randolph

 

 

 

CATHOLIC MEDICAL CENTER/ELLIOT HOSPITAL

 

Auburn

Deerfield

Londonderry

Bedford

Goffstown

Manchester

Candia

Hooksett

New Boston

 

 

CHESHIRE HOSPITAL

 

Alstead

Langdon

Sullivan

Chesterfield

Marlborough

Surry

Fitzwilliam

Marlow

Swanzey

Gilsum

Nelson

Troy

Harrisville

Richmond

Walpole

Hinsdale

Roxbury

Westmoreland

Keene

Stoddard

Winchester

 

CONCORD HOSPITAL

 

Allenstown

Deering

Pittsfield

Andover

Dunbarton

Salisbury

Barnstead

Epsom

Warner

Boscawen

Henniker

Washington

Bow

Hillsborough

Webster

Bradford

Hopkinton

Weare

Canterbury

Loudon

Windsor

Chichester

Northwood

 

Concord

Pembroke

 

 

 

COTTAGE HOSPITAL

 

Bath

Haverhill

 

Benton

Monroe

 

 

 

EXETER HOSPITAL

 

Brentwood

Hampton Falls

Plaistow

Danville

Kensington

Raymond

East Kingston

Kingston

Seabrook

Epping

Newfields

South Hampton

Exeter

Newmarket

Stratham

Fremont

Newton

 

Hampton

Nottingham

 

 

 

FRISBIE MEMORIAL HOSPITAL

 

Farmington

Milton

Rochester

Middleton

New Durham

Strafford

 

HUGGINS HOSPITAL

 

Alton

Freedom

Tuftonboro

Brookfield

Ossipee

Wakefield

Effingham

Tamworth

Wolfeboro

 

 

LAKES REGION GENERAL HOSPITAL/FRANKLIN REGIONAL HOSPITAL

 

Danbury

Hill

 

Franklin

Tilton

 

 

 

LAKES REGION GENERAL HOSPITAL

 

Belmont

Laconia

Northfield

Center Harbor

Meredith

Sanbornton

Gilford

Moultonborough

Sandwich

Gilmanton

New Hampton

 

 

LITTLETON HOSPITAL

 

Beans Grant

Franconia

Lyman

Bethlehem

Greens Grant

Martins Location

Carroll

Hadleys Purchase

Pinkhams Grant

Chandlers

Landaff

Sargents Purchase

Crawfords

Lisbon

Sugar Hill

Cutts Grant

Littleton

Thompson and Meserve

Easton

Low and Burbanks Grant

 

 

 

MEMORIAL HOSPITAL

 

Albany

Conway

Jackson

Bartlett

Eaton

Madison

Beans Purchase

Harts Location

 

Chatham

Hales Location

 

 

 

MONADNOCK COMMUNITY HOSPITAL

 

Antrim

Greenville

Rindge

Bennington

Hancock

Sharon

Dublin

Jaffrey

Temple

Francestown

New Ipswich

 

Greenfield

Peterborough

 

 

 

NEW LONDON HOSPITAL

 

Goshen

New London

Wilmot

Newport

Sunapee

 

Newbury

Sutton

 

 

 

PARKLAND MEDICAL CENTER

 

Atkinson

Hampstead

Windham

Chester

Salem

 

Derry

Sandown

 

 

 

PORTSMOUTH REGIONAL HOSPITAL

 

Greenland

Newington

Portsmouth

New Castle

North Hampton

Rye

 

 

ST. JOSEPH’S HOSPITAL/ SOUTHERN NH REGIONAL MEDICAL CENTER

 

Amherst

Litchfield

Milford

Brookline

Lyndeborough

Mont Vernon

Hollis

Mason

Nashua

Hudson

Merrimack

Wilton

 

 

SPEARE MEMORIAL HOSPITAL

 

Alexandria

Groton

Thornton

Ashland

Hebron

Warren

Bridgewater

Holderness

Waterville

Bristol

Lincoln

Wentworth

Campton

Livermore

Woodstock

Dorchester

Plymouth

 

Ellsworth

Rumney

 

 

 

UPPER CONNECTICUT VALLEY HOSPITAL

 

Atkinson and Gilmanton Grant

Dixs Grant

Second College Grant

Clarksville

Dixville

Stewartstown

Colebrook

Ervings Location

Wentworth Location

Columbia

Pittsburg

 

 

 

VALLEY REGIONAL HOSPITAL

 

Ackworth

Claremont

Unity

Charlestown

Lempster

 

 

 

WEEKS MEMORIAL HOSPITAL

 

Dalton

Lancaster

Stark

Errol

Millsfield

Stratford

Jefferson

Northumberland

Whitefield

Kilkenny

Odell

 

 

 

WENTWORTH-DOUGLASS HOSPITAL

 

Barrington

Lee

Somersworth

Dover

Madbury

 

Durham

Rollinsford

 

 

          (e)  Notwithstanding (d) above, any party in any proceeding shall have the opportunity to demonstrate a service area different from that shown in Table 1003-1 based on the results of applying the methodology in (b) and (c).

 

          (f)  Applicants may identify a secondary service area for its proposed project based on patient origin data specific to patient care services under consideration in the application rather than general patient origin data.

 

          (g)  Any party that proposes a service area under (e) or (f) above shall notify any affected acute care hospital of such proposal.

 

          (h)  Notification of the proposed service area shall be made in writing with a copy provided to the board as part of the application.

 

Source.  #4097, eff 7-22-86; ss by #4988, eff 11-21-90; ss by #5236, eff 9-27-91, EXPIRED: 9-27-97

 

New.  #6655, INTERIM, eff 12-18-97, EXPIRED: 4-17-98

 

New.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09 (from He-Hea 1003.02)

 

          He-Hea 1003.02  Service Area Population.

 

          (a)  Applicants shall develop:

 

       (1)  Current and projected populations for their hospital service area and secondary service area; and

 

(2)  Current and projected age and gender cohorts for their hospital service area and secondary service area.

 

          (b)  Population estimates for (a) above shall be obtained from:

 

(1)  The U. S. Census;

 

(2)  The New Hampshire office of energy and planning, 57 Regional Drive, Concord, NH;

 

(3)  The office of health statistics and data management, division of public health services, department of health and human services; or

 

(4)  A nationally recognized demographic data provider.

 

          (c)  Age groups for (a) above shall be determined as follows:

 

(1)  0-14;

 

(2)  15-44;

 

(3)  45-64; and

 

(4)  65 and older.

 

          (d)  Notwithstanding (c) above, applicants shall have the opportunity to demonstrate different age groupings that apply specifically to their proposal in terms of:

 

(1)  Women of child-bearing age;

 

(2)  Infants;

 

(3) Pediatric patients; or

 

(4)  Geriatric patients.

 

          (e)  In the event of any dispute brought before the board relative to age and gender cohorts presented in any application, the board shall rely upon the age and gender population estimates as provided by the New Hampshire office of energy and planning, 57 Regional Drive, Concord, N.H. to make a final determination on the proposal.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1003.03   Market Share.  Applicants shall report their market share for each town in the proposed service area by using discharge data from the uniform discharge dataset maintained in accordance with RSA 126:25.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09 (from He-Hea 1003.05)

 

          He-Hea 1003.04   Projected Patient Days Calculation.

 

          (a)  “UR” means use rate which is a table of age and gender use rates that is computed by the applicant by dividing the total patient days statewide for the most recent 12 months as obtained from the UHDDS  by the statewide population for the same time period divided by 1,000;

 

          (b)  “Ppop” means projected population by age and sex cohort for each of the cities and towns in the hospital service area as well as any secondary service area defined by the applicant;

 

          (c)  “MS” means market share as determined by the percentage of discharges the applicant receives from a given town as reported by all New Hampshire hospitals as part of RSA 126:25;

 

          (d)  “OPD” means outside patient days which is the historical annual patient days generated by persons residing outside the state of N.H.utilizing the applicant’s hospital multiplied by the historical growth rate for this category of patient days. 

 

          (e)  To determine projected patient days, applicants shall multiply the use rates by the projected populations and market share for each town, and then add the outside patient days to the sum of these two figures, as in the formula below:

 

PROJECTED PATIENT DAYS = (UR X Ppop X MS)+ OPD

 

          (f)  The applicant shall sum all results of (e) above to arrive at total projected patient days for the identified service area.

 

          (g)  Age groups for (a) above shall be determined as follows:

 

(1)  0-14;

 

(2)  15-44;

 

(3)  45-64; and

 

(4)  65 and older.

 

          (h)  Notwithstanding (g) above, applicants shall have the opportunity to demonstrate different age groupings that apply specifically to their proposal in terms of:

 

(1)  Women of child-bearing age;

 

(2)  Infants;

 

(3)  Pediatric patients; or

 

(4)  Geriatric patients.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07 (from He-Hea 1003.05); ss by #9457, eff 4-21-09 (from He-Hea 1003.04)

 

          He-Hea 1003.05  Net Revenue per Adjusted Admission Calculation.

 

          (a)  “Total Admissions” means the total number of patients admitted to the hospital within a given year.

 

          (b)  “Inp_Rev” means the gross inpatient revenue collected from patients admitted to the hospital in a given year.

 

          (c)  Out_Rev” means the gross outpatient revenue collected from patients treated in the outpatient setting of a hospital in a given year.

 

          (d)  “DPU” means the gross total distinct part unit revenue, which is the sum of psychiatric and physical rehabilitation revenue collected from patients admitted to these units of a hospital for such care in a given year.

 

          (e)  “HH_Rev” means the gross home health revenue collected from patients provided services in the home from the hospital in a given year.

 

          (f)  To calculate adjusted admissions of a hospital, applicants shall divide the sum of gross inpatient revenue, gross outpatient revenue, gross distinct part unit revenue and gross home health revenue by the sum of gross inpatient revenue and gross distinct part unit revenue, then multiply this result by total admissions, as in the formula below:

 

Total Admissions X (Inp_Rev + Out_Rev + DPU_Rev + HH_Rev) /

(Inp_Rev + DPU_Rev)

 

          (g)  To determine the net revenue per adjusted admission for a hospital, applicants shall divide the total net revenue by the adjusted admissions result determined by (f) above.

 

          (h)  The result of (g) above shall be applied to the criterion found in He-Hea 1004.01(l).

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07 (from He-Hea 1003.06); ss by #9457, eff 4-21-09

 

          He-Hea 1003.06  Bed Replacement.

 

          (a)  Requests for replacement of existing beds shall be developed on the basis of the following minimum and optimal occupancy rates based upon total operational beds for general hospitals, by service category, as set forth in Table 1003-2, “Bed Replacement Calculation Table”.

 

Table 1003-2 Bed Replacement Calculation Table

 

          Service Category

Minimum Occupancy

Optimal Occupancy

          Medical/Surgical

75%

90%

          Obstetrics

60%

85%

          Pediatrics

 

 

             Less than 40 beds

60%

85%

              More than 40 beds

65%

90%

          ICU/CCU

60%

85%

          Psychiatric

70%

90%

 

          (b)  “ADC” means average daily census which is computed by dividing the total patient days computed in He-Hea 1003.04 by 365.

 

          (c)  “fp” means probability factor which at a 95% confidence level for medical/surgical and pediatric service converts to a multiple of 1.65 and a 99% confidence level for CCU, ICU, and obstetric services converts to a multiple of 2.33.

 

          (d)  Need for replacement of existing beds shall be determined by multiplying the square root of the average daily census by the probability factor, then adding the product of these 2 figures by the average daily census, as in the formula below:

 

Bed Need = ADC + (fpÖADC)

 

          (e)  Notwithstanding (a) through (d) above, any hospital given Medicare designation as a critical access hospital shall not be held to the occupancy rates set forth in Table 1003-2.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07 (from He-Hea 1003.07); ss by #9457, eff 4-21-09 (from He-Hea 1003.01)

 

          He-Hea 1003.07  Impact on Other Providers.

 

          (a)  Applicants proposing to establish, expand or renovate an acute care facility shall demonstrate that the proposed facility shall not have a detrimental impact on health services within the proposed service area in terms of:

 

(1)  Quality of care;

 

(2)  Access to and availability of health care services; and

 

(3)  Cost effectiveness of health care services provided.

 

          (b)  Demonstration shall be made by submitting with the application:

 

(1)  A copy of an existing or proposed quality improvement program pursuant to He-Hea 303.05;

 

(2)  To the extent data is available, a statistical report in the application which shows how the proposed project is projected to affect health care services in the proposed service area in terms of:

 

a.  Utilization;

 

b.  Patient charges;

 

c.  Market share;

 

d.  Physician referral patterns;

 

e.  Personnel resources; and

 

f.  Referral sources.

 

(3)  Any correspondence from other facilities in the service area regarding the impact of the proposed project on their existing health care services including their continued ability to:

 

a.  Maintain quality health care services;

 

b.  Provide essential community services;

 

c.  Provide emergency services; and

 

d.  Provide charity care.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07 (from He-Hea 1003.08); ss by #9457, eff 4-21-09

 

PART He-Hea 1004  CRITERIA FOR FACILITY EXPANSIONS, RENOVATIONS OR REPLACEMENT OF ACUTE CARE FACILITIES

 

          He-Hea 1004.01  Criteria.  In addition to all other requirements in RSA 151-C:7 and He-Hea 303.02 through He-Hea 303.09, applicants shall meet the following criteria for consideration of a CON for expansion, renovation or replacement of an acute care facility:

 

          (a)  Applicants shall demonstrate that the anticipated proposed construction cost per bed, cost per square foot and square foot per bed shall be comparable in cost and size by a 10% margin to the 2008 edition of Marshall Valuation Service, section 15;

 

          (b)  Demonstration of project costs shall be made in the form of a report included with the application which provides:

 

(1)  A detail of the costs and space by department or area affected by the proposed project; and

 

(2)  A comparison of these costs which shall be within 10% of the 2008 edition of Marshall Valuation Service, section 15, for the proposed class and type of construction; and

 

(3)  An identification of the square footage for each department or area before and after the project;

 

          (c)  Applicants shall include a report in the application which provides:

 

(1)  An analysis of the class and quality of construction pursuant to section one of the 2008 Marshall Valuation Service;

 

(2)  The allocation of costs within a multiple use building;

 

(3)  The allocations of site costs and land costs where facilities are proposed to have multiple uses;

 

(4)  The methodology used in calculating construction costs for renovations;

 

(5)  The methodology used in calculating construction costs involving leasehold improvements; and

 

(6)  The anticipated useful life of the building for depreciation purposes;

 

          (d)  The following construction costs shall be compared with the 2008 Marshall Valuation Service, section 15:

 

(1)  Total costs associated with:

 

a.  Labor;

 

b.  Materials; and

 

c.  Fixed equipment;

 

(2)  Building permits;

 

(3)  Architectural and engineering fees;

 

(4)  Site preparation for the building;

 

(5)  Utilities from structure to lot line;

 

(6)  Insurance costs during construction; and

 

(7)  Interest costs during construction;

 

          (e)  The applicant shall follow the outline of the calculator method set forth in section 10 of the 2008 Marshall Valuation Service to determine construction costs;

 

          (f)  The costs and factors to take into account pursuant to (e) above shall include:

 

(1)  The base cost found in the general hospital table in section 15, page 24 of the 2008 Marshall Valuation Service:

 

(2)  An adjustment to heating, ventilation and air-conditioning costs for extreme climate:

 

(3)  Sprinkler system costs;

 

(4)  Story height multipliers;

 

(5)  Perimeter multipliers; and

 

(6)  Cost multipliers from section 99 of the 2008 Marshall Valuation Service;

 

          (g)  For inpatient projects, applicants shall provide a comparison of the proposed construction cost per bed to the 2008 edition of the Marshall Valuation Service, section 15, page 38;

 

          (h)  For inpatient projects, applicants shall provide a comparison of the proposed area per bed to the 2008 edition of the Marshall Valuation Service, section 15, page 38;

 

          (i)  Applicants shall describe anticipated operational cost savings that may occur as a result of the project due to:

 

(1)  Consolidation of services;

 

(2)  Improved heating and maintenance costs;

 

(3)  Environmental design of the constructed or renovated space;

 

(4)  Space for future expansion; or

 

(5)  Other factors not listed above.

 

          (j)  Applicants shall document the projected impact on hospital financial activity as a result of the proposed project;

 

          (k)  Documentation shall be made in the form of a report included with the application that contains:

 

(1)  The trended and projected increases in net revenue per adjusted admission as calculated in He-Hea 1003.05 for the past 3 years and continuing through 3 years after project completion; and

 

(2)  Any case mix adjustment that would apply.

 

            (l)   The expansion, renovation or replacement of the acute care facility shall be financially feasible;

 

            (m)  In order to assess the current and long-range financial feasibility of the proposed project, applicants shall demonstrate that resources:

 

(1)  Are available to fund the proposed capital costs and operating costs;

 

(2)  Will be available to maintain operations in the event of interruptions to cash flow; and

 

(3)  Will be available to ensure the continued operation of the proposed project;

 

          (n)  Demonstration of financial feasibility shall be made by providing with the application:

 

(1)  Copies of the facility’s financial statements for the past 3 fiscal years and continuing through 3 years after project completion;

 

(2)  A statement of the sources of funds to finance the proposed project;

 

(3)  Documentation from the applicant’s lender, underwriter or other anticipated source of capital, which includes:

 

a.  Financed amount;

 

b.  Rate of interest; and

 

c.  Term of debt; and

 

(4)  A computation of financial ratios as outlined in He-Hea 1004.02 through He-Hea 1004.05 for the past 3 years and continuing through 3 years after project completion using the financial figures in the applicant’s historical and projected financial statements;

 

          (o)  Applicants shall demonstrate that resources will be available to support the personnel needs of the proposed expansion, renovation or replacement of the acute care facility;

 

          (p)  Demonstration of resources shall be made in the form of a report which provides a schedule of all personnel for the past 3 years and continuing through 3 years after project completion; 

 

          (q)  Applicants shall document the assumptions used to determine the overall financial feasibility of the proposed projects to expand, renovate or replace their respective facilities;

 

          (r)  Documentation of assumptions shall be made in the form of a report which includes the following:

 

(1)  The source of the documents used to determine the population projections of the primary and secondary service areas, if different than the office of energy and planning, 57 Regional Drive, Concord, NH;

 

(2)  The changes in market conditions which would result in a change in market share;

 

(3)  The causes of any anticipated changes in the overall length of stay in the hospital;

 

(4)  The assumptions used to prepare the projected financial statements; and

 

(5)  Other assumptions the applicant considers pertinent to the project’s feasibility.

 

Source.  #4097, eff 7-22-86; ss by #4456, eff 7-25-88; ss by #4988, eff 11-21-90; ss by #5236, eff 9-27-91, EXPIRED:9-27-97

 

New.  #6655, INTERIM, eff 12-18-97, EXPIRED: 4-17-98

 

New.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1004.02  Operating Margin Ratio.

 

          (a)  “Total operating revenues” means the sum of all revenue collected from the provision of patient care services.

 

          (b)  “Operating expenses” means the annual costs of the day-to-day provision of patient care services.

 

          (c)  To calculate operating margin ratio, the applicant shall subtract operating expenses from total operating revenues, and then divide the result by total operating revenues, as in the formula below:

 

Total operating revenues - operating expenses

Total operating revenues

 

Source.  #4097, eff 7-22-86; ss by #4456, eff 7-25-88; ss by #4988, eff 11-21-90; ss by #5236, eff 9-27-91, EXPIRED:9-27-97

 

New.  #6655, INTERIM, eff 12-18-97, EXPIRED: 4-17-98

 

New.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1004.03  Debt Services Ratio.

 

          (a)  “Cash flow” means the sum of total revenue less total expenses plus depreciation and interest payment.

 

          (b)  “Principal payment” means the amount of a loan due during one year which is attributable to the principal portion of the debt, less interest costs.

 

          (c)  “Interest expense” means the yearly cost of borrowed funds.

 

          (d)  To calculate debt services ratio, applicants shall divide cash flow by the sum of principal payment plus interest expense, as in the formula below:

 

Cash flow

Principal payment + interest expense

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New. #m 8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1004.04  Debt to Equity Ratio.

 

          (a)  “Long term liabilities” means a facility’s debt which is likely to take more than one year to be paid.

 

          (b)  “Fund balance” means the excess of assets over liabilities.

 

          (c)  To calculate debt to equity ratio, applicants shall divide long term liabilities by fund balance, as in the formula below:

 

Long term liabilities

Fund balance

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1004.05  Current Ratio.

 

          (a)  “Current assets” means a facility’s economic resources which are likely to be converted to cash in one year.

 

          (b)  “Current liabilities” means debt of a facility paid within one year of incurrence.

 

          (c)  To calculate current ratio, applicants shall divide current assets by current liabilities, as in the formula below:

 

Current assets

Current liabilities

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07); ss by #9457, eff 4-21-09

 

PART He-Hea 1005  FILING DATES FOR EXPANSION, RENOVATION OR REPLACEMENT OF ACUTE CARE FACILITIES

 

          He-Hea 1005.01  Requests for Applications.  The board shall issue a request for applications on August 1 of each year pursuant to RSA 151-C:8, I if potential need has been determined based upon the receipt of a letter of intent from a provider.

 

Source.  #4456, eff 7-25-88; ss by #4988, eff 11-21-90; ss by #5236, eff 9-27-91, EXPIRED: 9-27-97

 

New.  #6655, INTERIM, eff 12-18-97, EXPIRED: 4-17-98

 

New.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1005.02  Submission of Applications.  Applications shall be:

 

          (a)  Prepared using the board’s application form per He-Hea 304; and

 

          (b)  Submitted to the board 90 days after a request for applications has been issued by the board.

 

Source.  #4456, eff 7-25-88; ss by #4988, eff 11-21-90; ss by #5236, eff 9-27-91, EXPIRED: 9-27-97

 

New.  #6655, INTERIM, eff 12-18-97, EXPIRED: 4-17-98

 

New.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

PART He-Hea 1006  STANDARDS FOR NEW ACUTE CARE BEDS

 

          He-Hea 1006.01  Need for New Acute Care Beds.

 

          (a)  The number of acute care beds statewide shall not exceed 2.5 for each 1,000 persons;

 

          (b)  The board shall apply the use rate in (a) above to 5 year projected population statistics that are prepared and available through the New Hampshire office of energy and planning, 57 Regional Drive, Concord, NH.

 

          (c)  The result of the calculation of (b) above shall constitute the 5 year projected statewide need for acute care beds.

 

          (d)  The board shall make a determination of unmet need for acute care beds on June 1st of each year.

 

          (e)  Unmet need shall be determined by subtracting the number of licensed and CON approved beds from that number calculated to be needed in (c) above.

 

Source.  #4456, eff 7-25-88; ss by #4988, eff 11-21-90; ss by #5236, eff 9-27-91, EXPIRED: 9-27-97

 

New.  #6655, INTERIM, eff 12-18-97, EXPIRED: 4-17-98

 

New.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1006.02  Service Area.  Hospital Service areas shall be based upon:

 

          (a)  The calculation per He-Hea 1003.01; and

 

          (b)  Table 1003-1 “Service Areas by Hospital.”

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRESD 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1006.03  Service Area Population.

 

          (a)  Applicants shall develop:

 

(1)  Current and projected populations for their hospital service area and secondary service area; and

 

(2)  Current and projected age and gender cohorts for their hospital service area and secondary service area.

 

          (b)  Population estimates for (a) above shall be obtained from:

 

(1)  The U. S. Census;

 

(2)  The New Hampshire office of energy and planning, 57 Regional Drive, Concord, NH;

 

(3)  The office of health statistics and data management, division of public health services, department of health and human services; or

 

(4)  A nationally recognized demographic data provider.

 

          (c)  Age groups for (a) above shall be determined as follows:

 

(1)  0-14;

 

(2)  15-44;

 

(3)  45-64; and

 

(4)  65 and older.

 

          (d)  Notwithstanding (c) above, applicants shall have the opportunity to demonstrate different age groupings that apply specifically to their proposal in terms of:

 

(1)  Women of child-bearing age;

 

(2)  Infants;

 

(3)  Pediatric patients; or

 

(4)  Geriatric patients.

 

          (e)  In the event of any dispute brought before the board relative to age and gender cohorts presented in any application, the board shall rely upon the age and gender population estimates as provided by the New Hampshire office of energy and planning, 57 Regional Drive, Concord, N.H. to make a final determination on the proposal.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09 (from He-Hea 1006.02)

 

          He-Hea 1006.04  Market Share.  Applicants shall report their market share for each town in the proposed service area by using discharge data from the UHDDS.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1006.05  Projected Patient Days.  Applicants shall provide projected patient days to support the proposed new beds from:

 

          (a)  The common hospital DRGs as outlined in He-Hea 1003.01;

 

          (b)  Any class of DRGs specific to the proposal; or

 

          (c)  Both (a) and (b) above.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09(from He-Hea 1006.06

 

          He-Hea 1006.06  Projected Patient Days Calculation.

 

          (a)  “UR” means use rate which is a table of age and gender use rates that is computed by the applicant by dividing the total patient days statewide for the most recent 12 months as obtained from the UHDDS  by the statewide population for the same time period divided by 1,000;

 

          (b)  “Ppop” means projected population for each age and sex cohort for the cities and towns in the hospital service area as well as any secondary service area defined by the applicant;

 

          (c)  “MS” means market share as determined by the percentage of discharges the applicant receives from a given town as reported by all New Hampshire hospitals as part of RSA 126:25;

 

          (d)  “OPD” means outside patient days which is the historical annual patient days generated by persons residing outside the state of N.H.utilizing the applicant’s hospital multiplied by the historical growth rate for this category of patient days. 

 

          (e)  To determine projected patient days, applicants shall multiply the use rates by the projected populations and market share for each town, then add the outside patient days to the sum of these two figures, as in the formula below:

 

PROJECTED PATIENT DAYS = (UR X Ppop X MS)+ OPD

 

          (f)  The applicant shall sum all results of (e) above to arrive at total projected patient days for the identified service area.

 

          (g)  Age groups for (a) above shall be determined as follows:

 

(1)  0-14;

 

(2)  15-44;

 

(3)  45-64; and

 

(4)  65 and older.

 

          (h)  Notwithstanding (g) above, applicants shall have the opportunity to demonstrate different age groupings that apply specifically to their proposal in terms of:

 

(1)  Women of child-bearing age;

 

(2)  Infants;

 

(3)  Pediatric patients; or

 

(4)  Geriatric patients.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1006.07  Occupancy Rates.

 

          (a)  Requests for additional beds shall be developed on the basis of the following minimum and optimal occupancy rates based upon total operational beds for general hospitals, by service category, as set forth in Table 1006-1, “Bed Calculation Table”.

 

Table 1006-1 Bed Calculation Table

 

          Service Category              

Minimum Occupancy

Optimal Occupancy

          Medical/Surgical

75%

90%

          Obstetrics

60%

85%

          Pediatrics

 

 

             Less than 40 beds

60%

85%

              More than 40 beds

65%

90%

          ICU/CCU

60%

85%

          Psychiatric       

70%

90%

 

          (b)  “ADC” means average daily census which is computed by dividing the total patient days calculated in He-Hea 1006.06 by 365.

 

          (c)  “fp” means probability factor which at a 95% confidence level for medical/surgical and pediatric service converts to a multiple of 1.65 and a 99% confidence level for CCU, ICU and obstetric services converts to a multiple of 2.33.

 

          (d)  Need for additional beds shall be determined by multiplying the square root of the average daily census by the probability factor, then adding the product of these 2 figures by the average daily census, as in the formula below:

 


Bed Need = ADC + (fpÖADC)

 

          (e)  Notwithstanding (a) through (d) above, applicants shall not apply the calculation to any need for additional beds utilized for observation status.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1006.08  Impact on Other Providers.

 

          (a)  Applicants proposing to establish, expand or renovate an acute care facility shall demonstrate that the proposed facility shall not have a detrimental impact on health services within the proposed service area in terms of:

 

(1)  Quality of care;

 

(2)  Access to and availability of health care services; and

 

(3)  Cost effectiveness of health care services provided.

 

          (b)  Demonstration shall be made by submitting with the application:

 

(1)  A copy of an existing or proposed quality improvement program pursuant to He-Hea 303.05;

 

(2)  To the extent data is available, a statistical report in the application which shows how the proposed project is projected to affect health care services in the proposed service area in terms of:

 

a.  Utilization;

 

b.  Patient charges;

 

c.  Market share;

 

d.  Physician referral patterns;

 

e.  Personnel resources; and

 

f.  Referral sources.

 

(3)  Any correspondence from other facilities in the service area regarding the impact of the proposed project on their existing health care services including their continued ability to:

 

a.  Maintain quality health care services;

 

b.  Provide essential community services;

 

c.  Provide emergency services; and

 

d.  Provide charity care.

 

Source.  #9457, eff 4-21-09; ss by #9457, eff 4-21-09

 

PART He-Hea 1007  CRITERIA FOR NEW ACUTE CARE BEDS

 

          He-Hea 1007.01  Criteria.  In addition to all other requirements in RSA 151-C:7, He-Hea  303.02 through He-Hea  303.09, and He-Hea 1004.01, applicants shall meet the following criteria for consideration of a CON for new acute care beds:

 

          (a)  Applicants shall demonstrate the impact of adding new acute care beds to the healthcare system of the state;

 

          (b)  Demonstration of impact of new beds shall be made by a statistical report in the application which shows how the proposed project is projected to affect the existing hospitals in the service area in terms of:

 

(1)  Utilization;

 

(2)  Patient charges;

 

(3)  Market share;

 

(4)  Physician referral patterns; and

 

(5)  Personnel resources;

 

          (c)  Applicants shall also provide a report with the application that supports the need for new beds in terms of:

 

(1)  Referrals from area health care providers as evidenced by letters of support;

 

(2)  Historical trends in volume such as:

 

a.  Admissions;

 

b.  Average length of stay;

 

c.  Patient days; and

 

d.  Occupancy rates;

 

(3)  Changes in market share;

 

(4)  The addition of new services with different market patterns;

 

(5)  The addition of specialized services with different market patterns; and

 

(6)  Any other causes presented to support the anticipated need for acute care beds.

 

Source.  #5236, eff 9-27-91, EXPIRED: 9-27-97

 

New.  #6655, INTERIM, eff 12-18-97, EXPIRED: 4-17-98

 

New.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

PART He-Hea 1008  FILING DATES FOR NEW BEDS

 

          He-Hea 1008.01  Request for Applications.  In accordance with RSA 151-C:8, I requests for applications shall be issued on August 1st of each year if a need has been delineated for new acute care beds pursuant to He-Hea 1006.01.

 

Source.  #5236, eff 9-27-91, EXPIRED: 9-27-97

 

New.  #6655, INTERIM, eff 12-18-97, EXPIRED: 4-17-98

 

New.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 

          He-Hea 1008.02  Submission of Applications.  Applications for new acute care beds shall be:

 

          (a)  Prepared using the board’s application form per He-Hea 304; and

 

          (b)  Submitted to the board 90 days after the issuance of a request for applications.

 

Source.  #6840, eff 8-28-98, EXPIRED: 8-28-06

 

New.  #8742, INTERIM, eff 10-21-06, EXPIRED: 4-19-07

 

New.  #8918, eff 6-22-07; ss by #9457, eff 4-21-09

 


APPENDIX

 

Rule

statute

 

 

He-Hea 1001.01

RSA 151-C:1

 

 

He-Hea 1002.01

RSA 151-C:2

 

 

He-Hea 1003.01 – He-Hea 1003.06

RSA 126:25, RSA 151-C:5,II(a), RSA 151-C;11, I

He-Hea 1003.07

RSA 151-C:5, II(a), RSA 151-C:11, I

 

 

He-Hea 1004.01 – He-Hea 1004.05

RSA 151-C:5, II(a), RSA 151-C:7, I-II, RSA 151-C:11, I

 

 

He-Hea 1005.01 – He-Hea 1005.02

RSA 151-C:8, I

 

 

He-Hea 1006.01 – He-Hea 1006.07

RSA 126:25, RSA 151-C:5, II (a); RSA 151-C:11, I

He-Hea 1006.08

RSA 151-C:5, II(a); RSA 151-C:11, I

 

 

He-Hea 1007.01

RSA 151-C:5, II(a), RSA 151-C:7, I-II, RSA 151-C:11, I

 

 

He-Hea 1008.01 – He-Hea 1008.02

RSA 151-C:8, I