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  • NJ A3101
  • Permits registered surgical practices to convert to or combine with ambulatory care facilities; provides for phased-in gross receipts assessment; authorizes non-profit hospitals to acquire joint ownership interest in practices.
Introduced
(2/22/2016)
In Committee
(2/22/2016)
Crossed OverPassedSignedDead/Failed/Vetoed
2016-2017 Regular Session
This bill authorizes surgical practices registered with the Department of Health (DOH) to convert to an ambulatory surgery facility, combine with an existing ambulatory care facility to expand the services offered through that facility, or allow a non-profit hospital or an entity owned in part by a non-profit hospital to acquire a joint ownership interest in the facility. The bill additionally permits two or more licensed ambulatory surgical facilities to combine. A conversion or combination will not be permitted under the bill if it would result in a net increase in the total number of operating rooms. The certificate of need requirement will not apply to a combination or conversion approved under the bill. Any action taken under the bill to combine or convert will require approval by the Commissioner of Health. Each entity included in the application to combine or convert will be required to possess a current registration or license and be in compliance with all rules and regulations necessary to complete the action. The application will be in a form and manner prescribed by DOH, and will include the following information for each entity included in the application: the name of the entity's chief administrator or designated agent; the entity's address; the names and addresses of each owner of the entity; the entity's registration or license number; a physical description of the entity, if applicable; documentation of compliance with all statutory and regulatory requirements; and any other information as DOH may require. The current application and licensure fees, renewal fees, inspection fees and other inspection requirements that apply to licensed health care facilities will apply to entities that are approved for combination or conversion under the bill. If the combination or conversion will require the entity to obtain certification by the Centers for Medicare and Medicaid Services (CMS) or obtain accreditation from an accrediting body recognized by CMS, the commissioner is to permit the entity a reasonable period of time to obtain the required certification or accreditation. The bill additionally provides that, in the case of an approved transfer of ownership of a registered surgical practice, DOH is to permit the transferee a reasonable period of time to obtain the required CMS certification or accreditation. A facility resulting from an approved conversion or combination under the bill will be subject to a phased-in gross receipts assessment. In the first complete fiscal year following restructuring, the facility will not pay an assessment; in the second complete fiscal year, the assessment will be 0.74% of gross receipts from the prior fiscal year; in the third complete fiscal year, the assessment will be 1.48% of gross receipts from the prior fiscal year; in the fourth complete fiscal year, the assessment will be 2.22% of gross receipts from the prior fiscal year; and in the fifth and each subsequent complete fiscal year, the assessment will be 2.95% of gross receipts from the prior fiscal year, which is the assessment that currently applies to licensed facilities. In the case of a licensed ambulatory care facility that combines with a registered surgical practice to expand the services provided by the facility, the phased-in assessment will only apply to gross receipts generated by the expanded portion of the facility. As under current law, no assessment will apply to a facility with gross receipts that are less than $300,000, and no facility will be required to pay an assessment of more than $350,000. In the case of a non-profit hospital acquiring joint ownership of a registered surgical practice, the bill provides that the exception from the prohibition against practitioner self-referrals (i.e. referring patients to a health care service in which the practitioner or a family member has a significant beneficial interest) which currently applies to registered surgical practices will extend to registered surgical practices in which a non-profit hospital acquires joint ownership. The exception requires that the practitioner who provided the referral personally performs the procedure, the practitioner's remuneration as an owner of or investor in the registered surgical practice is directly proportional to the practitioner's ownership interest and not to the volume of patient referrals, all clinically-related decisions at the registered surgical practice are made by practitioners and are in the best interests of the patient, and the practitioner provides written disclosure of the significant beneficial interest at or prior to the time the referral is made. This bill also changes the duration of a registration for a surgical practice from one year to two years. It is the sponsor's belief that facilitating the consolidation and restructuring of registered surgical practices is consistent with current market trends in the health care industry and will help improve and enhance the quality and safety of patient care.
2nd Reading in the Assembly
Assembly Health and Senior Services Hearing (10:00 2/22/2016 Committee Room 11, 4th Floor)  (on 2/22/2016)
 
 

Date Chamber Action Description
2/22/2016 A Reported out of Assembly Committee, 2nd Reading
2/22/2016 A Introduced, Referred to Assembly Health and Senior Services Committee
2/22/2016 Assembly Health and Senior Services Hearing (10:00 2/22/2016 Committee Room 11, 4th Floor)
Date Motion Yea Nay Other
Detail 2/22/2016 Assembly Health and Senior Services Committee: Reported Favorably 13 0 0