Sec. 10.24.01.01. Definitions

A. In this chapter, the following terms have the meanings indicated.

B. Terms Defined.

(1) "Acquisition" means:

(a) Any transfer of stock or assets that results in a change of the person or persons who control a health care facility; or

(b) The transfer of any stock or ownership interest in excess of 25 percent.

(2) "Adversely affected", for purposes of determining interested party status in a Certificate of Need review, as defined in §B(19) of this regulation, means that a person:

(a) Is authorized to provide the same service as the applicant, in the same planning region used for purposes of determining need under the State Health Plan or in a contiguous planning region if the proposed new facility or service could reasonably provide services to residents in the contiguous area;

(b) Can demonstrate that the approval of the application would materially affect the quality of care at a health care facility that the person operates, such as by causing a reduction in the volume of services when volume is linked to maintaining quality of care;

(c) Would suffer a substantial depletion of essential personnel or other resources by approval of the application by the Commission; or

(d) Can demonstrate to the reviewer that the person could suffer a potentially detrimental impact from the approval of a project before the Commission, in an issue area over which the Commission has jurisdiction, such that the reviewer, in the reviewer's sole discretion, determines that the person should be qualified as an interested party to the Certificate of Need review.

(3) "Aggrieved party" means:

(a) An interested party who:

(i) Presented written comments on an application to the Commission, both to the reviewer and in the form of exceptions to a proposed decision that is adverse to the position of that person, and

(ii) Would be adversely affected by the final decision of the Commission; or

(b) The Secretary.

(4) "Ambulatory surgical facility" means an entity or part of an entity with two or more operating rooms that:

(a) Operates primarily for the purpose of providing surgical services to patients who do not require overnight hospitalization; and

(b) Seeks reimbursement from a third-party payor as an ambulatory surgical facility.

(5) "Approved bed" means a bed approved by the Commission in a Certificate of Need, but not yet licensed.

(6) "By or on behalf of" includes, but is not limited to, a capital expenditure which affects the physical plant, service volume, or service capacity of a health care facility or health maintenance organization regardless of the source of the funds.

(7) "Capital expenditure" means:

(a) An expenditure, including predevelopment costs, which:

(i) Is made by or on behalf of a health care facility, and which, under generally accepted accounting principles, is not properly chargeable as an expense of operation and maintenance, or which is made to obtain by lease or comparable arrangement any physical plant for a facility;

(ii) Is made as part of an acquisition, improvement, or expansion, including redevelopment costs, and is more than the threshold for capital expenditures;

(iii) Is made as part of replacement of a physical plant of the health care facility and is more than the threshold for capital expenditures;

(iv) Results in a change in the bed capacity of a health care facility with respect to which the expenditure is made that meets the criteria of Regulation .02A(3) of this chapter;

(v) Results in a relocation of a health care facility that meets the criteria of Regulation .02A(2) of this chapter; or

(vi) Results in a change in the health care services to be offered by a health care facility that meets the criteria of Regulation .02A(4) of this chapter;

(b) A donation of a physical plant to a health care facility, if a Certificate of Need would be required for an expenditure by the health care facility to acquire the physical plant directly;

(c) A transfer of a physical plant to a facility for less than fair market value, which is considered a capital expenditure if the transfer of the physical plant at fair market value would be a capital expenditure.

(8) "Certificate of Need (CON)" means an approval issued by the Commission for a health care project under Health-General Article, Title 19, Annotated Code of Maryland.

(9) "Department" means the Maryland Department of Health.

(10) "Existing health care facility" means a health care facility, as described in §B(12) of this regulation, which is licensed by the Department.

(11) "General hospice care program" means a coordinated, interdisciplinary program of hospice care services for meeting the special physical, psychological, spiritual, and social needs of dying individuals and their families, by providing palliative and supportive medical, nursing, and other health services through home-based or inpatient care during illness and bereavement.

(12) Health Care Facility.

(a) "Health care facility" means:

(i) A hospital, as defined in Health-General Article, §19-301(g), Annotated Code of Maryland;

(ii) A limited service hospital, as defined in Health-General Article, §19-301(e), Annotated Code of Maryland;

(iii) A related institution, as defined in Health-General Article, §19-301(o), Annotated Code of Maryland;

(iv) An ambulatory surgical facility;

(v) A rehabilitation facility;

(vi) A home health agency, as defined in Health-General Article, §19-401(b), Annotated Code of Maryland;

(vii) A hospice, as defined in Health-General Article, §19-901, Annotated Code of Maryland;

(viii) Other health institutions, services, or programs that may be specified as requiring a Certificate of Need under State law.

(b) "Health care facility" does not mean:

(i) A hospital or related institution operated, or listed and certified, by the First Church of Christ Scientist, Boston, Massachusetts;

(ii) For the purpose of providing an exclusion from a Certificate of Need under Health-General Article, §19-120, Annotated Code of Maryland, a facility to provide comprehensive care constructed by a provider of continuing care, as defined in Article 70B, Annotated Code of Maryland, if the facility is for the exclusive use of the provider's subscribers who have executed continuing care agreements except as provided by Regulation .03J of this chapter;

(iii) A kidney disease treatment facility, or the kidney disease treatment stations and services provided by or on behalf of a hospital, if the facility or the services do not include kidney transplant services or programs;

(iv) The office of one or more individuals licensed to practice dentistry under Health Occupations Article, Title 4, Annotated Code of Maryland, for the purposes of practicing dentistry.

(13) "Health care project" means a health care project requiring a Certificate of Need as set forth in Regulation .02 of this chapter.

(14) "Health care services" means clinically related patient services.

(15) "Health Facilities Coordination Office" means that office of the Commission which acts as the entry and information point for applications for Certificate of Need.

(16) "Health maintenance organization" means a health maintenance organization under Health-General Article, §19-701, Annotated Code of Maryland.

(17) "Health planning region" means the area used for planning for a particular service as provided in the State Health Plan.

(18) Home Health Agency.

(a) "Home health agency" means a health-related organization, institution, or part of an institution that, directly or through a contractual arrangement, provides to a sick or disabled individual in the residence of that individual, skilled nursing and home health aide services, and at least one other home health care service, that are centrally administered, as provided under Health-General Article, §19-401, et seq., Annotated Code of Maryland.

(b) "Home health agency" includes both parent (previously known as a branch) and subunit, as defined by the Centers for Medicare and Medicaid Services under 42 CFR §484.2.

(19) Initiation of Construction.

(a) "Initiation of construction" for a new health care facility or expansion of an existing health care facility means that an approved project has filed with the Commission appropriate documents and photographs establishing that the approved project has:

(i) Obtained permits, approvals, or both considered necessary by applicable federal, State, and local authorities to initiate construction;

(ii) Completed necessary preconstruction site work; and

(iii) Started the installation of the foundation system with placement of permanent components, such as reinforcing steel, concrete, and piles.

(b) "Initiation of construction" for the renovation of an existing health care facility means that an approved project has filed with the Commission appropriate documents and photographs establishing that the approved project has:

(i) Obtained permits, approvals, or both considered necessary by applicable federal, State, and local authorities to initiate renovation;

(ii) Begun the demolition or relocation of affected services necessary to undertake the renovation project.

(20) "Interested party" means a person recognized by a reviewer as an interested party and may include:

(a) The applicant for a proposed project;

(b) The staff of the Commission;

(c) A third-party payor who can demonstrate substantial negative impact on overall costs to the health care system if the project is approved;

(d) A local health department in the jurisdiction or, in the case of regional services, in the planning region in which the proposed service is to be offered; and

(e) A person who can demonstrate to the reviewer that the person would be adversely affected, in an issue area over which the Commission has jurisdiction, by the approval of a proposed project.

(21) "Jurisdiction" means the 23 counties of Maryland and Baltimore City.

(22) Licensed Bed Capacity.

(a) "Licensed bed capacity" means the number of beds in any of the medical service categories or subcategories in a health care facility identified in §B(25) of this regulation, as they appear in the Commission's inventories of service capacity.

(b) "Licensed bed capacity" does not mean the number of holding beds to support hospital emergency services, bassinets, or recovery beds to support ambulatory surgical services.

(23) "Limited service hospital" means a health care facility that:

(a) Is licensed as a hospital on or after January 1, 1999;

(b) Changes the type or scope of health care services offered by eliminating the facility's capability to admit or retain patients for overnight hospitalization;

(c) Retains an emergency or urgent care center; and

(d) Complies with the regulations adopted by the Secretary under Health-General Article, §19-307.1, Annotated Code of Maryland.

(24) "Long-term significant relationship" means a relationship characterized by mutual economic dependence, demonstrated by evidence such as a joint lease or mortgage or power of attorney, and evidence of common legal residence shown by driver's licenses, voter registration, or other identification.

(25) "Local health department" means the health department in a jurisdiction or a body designated by that jurisdiction to perform health planning functions.

(26) "Maryland Health Care Commission (Commission)" means the agency established by Health-General Article, Title 19, Subtitle 1, Annotated Code of Maryland, that replaced the Health Care Access and Cost Commission and the Maryland Health Resources Planning Commission, effective October 1, 1999.

(27) "Medical service" means:

(a) Any of the following categories of health care services as they appear in the Commission's inventories of service capacity:

(i) Medical/surgical/gynecological/addictions;

(ii) Obstetrics;

(iii) Pediatrics;

(iv) Psychiatry;

(v) Rehabilitation;

(vi) Chronic care;

(vii) Comprehensive care;

(viii) Extended care;

(ix) Intermediate care; or

(x) Residential treatment; or

(b) A subcategory of the rehabilitation, psychiatry, comprehensive care, or intermediate care categories of medical services for which the State Health Plan provides a need projection methodology or specific standards.

(28) "Multiphased plan of construction" is a plan of construction for an addition, replacement, modernization, relocation, or conversion of an existing health care facility that:

(a) Costs more than $40,000,000; and

(b) Involves distinct elements of construction, demolition, or renovation that are initiated or completed before one or more subsequent elements of the overall project are initiated.

(29) "Operating room" means a discrete area where surgical services are provided, as defined in the State Health Plan under COMAR 10.24.11.

(30) "Participating entity" means a person recognized by the executive director as a participating entity and may include:

(a) A third-party payor;

(b) A jurisdiction in the health planning region that is used for purposes of determining need under the State Health Plan, where the proposed project will be located or from which an existing health care facility seeks to relocate; and

(c) A municipality where the proposed project will be located or from which an existing health care facility seeks to relocate.

(31) "Person" includes an individual, receiver, trustee, guardian, executor, administrator, fiduciary, or representative of any kind and any partnership, firm, association, limited liability company, limited liability partnership, public or private corporation, or other entity.

(32) Personal Physician.

(a) "Personal physician" means a physician licensed to practice medicine who:

(i) Was chosen by the individual;

(ii) Has an established physician-patient relationship with the individual; and

(iii) Has provided health care services to the individual.

(b) "Personal physician" may not be an owner, employee, under contract with, or have a material financial interest in the continuing care retirement community, its management company, or related entity.

(33) Predevelopment Costs.

(a) "Predevelopment costs" means all costs related to the preliminary development of a project which include, but are not limited to, the costs of preliminary plans, studies, surveys, architectural designs, plans, reports, application fees, legal fees, financing fees, consulting fees, working drawings, or specifications undertaken in preparation for the development or offering of a health care project.

(b) "Predevelopment costs" does not include activities routinely undertaken by a health care facility as a part of its internal management or long-range planning process.

(34) "Primary service area" means:

(a) The Maryland postal ZIP codes from which the first 60 percent of a hospital's patient discharges originate during the most recent 12-month period, where the discharges from each ZIP code are ordered from largest to smallest number of discharges and where two or more ZIP codes have the same numbers of discharges, the ZIP codes are ordered from the largest to smallest based on the percentage of ZIP code discharges to the hospital in the most recent 12-month period;

(b) Point ZIP codes physically within any of the ZIP codes designated in §B(33)(a) of this regulation;

(c) Maryland ZIP codes physically contiguous to any of the ZIP codes designated in §B(33)(a) of this regulation that provided 50 percent or more of their discharges to the hospital in the most recent 12-month period; and

(d) For a merged asset system, the ZIP codes are tabulated separately for each hospital, and all ZIP codes identified for each hospital are included in the primary service area of the merged asset system.

(35) "Public body obligation" means a bond, note, evidence of indebtedness, or other obligation for the payment of borrowed money issued by:

(a) The Maryland Health and Higher Educational Facilities Authority;

(b) The State, or any agency, instrumentality, or public corporation of the State;

(c) Any public body as defined in Article 31, §9, Annotated Code of Maryland;

(d) The Mayor and City Council of Baltimore; or

(e) A municipal corporation subject to the provisions of Article XI-E of the Maryland Constitution.

(36) "Rehabilitation facility" means an inpatient facility that:

(a) Is organized for the primary purpose of assisting in the rehabilitation of persons with disabilities through an integrated program of medical and other services which are provided under competent professional supervision;

(b) Is licensed as a special rehabilitation hospital; and

(c) Complies with the regulations adopted by the Secretary under Health-General Article, Title 19, Subtitle 3, Annotated Code of Maryland.

(37) "Reviewer" means one Commissioner, appointed by the Executive Director of the Commission, who:

(a) Evaluates each Certificate of Need application according to the entire record of written submissions and oral presentations by each applicant and interested party;

(b) Prepares a proposed decision for the consideration of the full Commission; and

(c) Serves as presiding officer at an evidentiary hearing on the application or applications, if the reviewer determines that an evidentiary hearing is warranted, according to the criteria set forth in Regulation .10D of this chapter.

(38) "Secretary" means the Secretary of Health.

(39) "State Health Plan" means the State Health Plan for Facilities and Services and its modifications or additions, adopted by the Commission pursuant to State health planning law, and incorporated by reference in this subtitle.

(40) "Threshold for capital expenditures" means:

(a) For a hospital, $10,000,000 for the period June 1 through December 31, 2006, after that to be adjusted annually by the Commission according to the Consumer Price Index-Urban (CPI-U) for the Baltimore Metropolitan Area published by the U.S. Department of Labor, and rounded off to the nearest $50,000; and

(b) For a health care facility other than a hospital, $5,000,000 for the period June 1 through December 31, 2006, after that to be adjusted by the Commission according to the Consumer Price Index-Urban (CPI-U) for the Baltimore Metropolitan Area published by the U.S. Department of Labor, and rounded off to the nearest $50,000.