216 R.I. Code R. 216-RICR-40-10-22.16 - Changes, Cost Overruns, and Failure to Implement

A. Except for approved nursing facility proposals, any cost overrun that exceeds seven hundred and fifty thousand dollars ($750,000) or ten percent (10%) of the total approved capital cost, whichever is more, shall require review by the Health Services Council and approval of the state agency.

1. For nursing facility proposals, any cost overrun that exceeds three hundred thousand dollars ($300,000) or ten percent (10%) of the total approved capital cost, whichever is less, requires review by the Health Services Council and approval of the state agency. Cost overruns that are three hundred thousand dollars ($300,000) or less shall be submitted to the state agency for administrative review and determination.

B. All other changes (including changes in financing plans) to an approved project for provision of new institutional health services or new health care equipment shall require approval of the state agency.

1. For the purpose of this section, a change includes any change in the bed capacity of a facility or the addition or termination of a health service which occurs within one (1) year after the date the activity for which the expenditure was approved is initiated or implemented, whether or not a capital expenditure is involved.

2. If applicable, the State Budget Office and Hospital Service Corporations organized under R.I. Gen. Laws Chapter 17-19 shall provide the state agency with a cost impact analysis for the cost overrun.

C. Failure to initiate development of a new institutional health service or new health care equipment, not involving construction, within one (1) year of the date of approval of such new institutional health service or new health care equipment unless otherwise specifically conditioned in the state agency decision shall be grounds for review by the Health Services Council and the state agency to determine if approval should be withdrawn.

D. Failure to execute a contract to initiate construction of a new institutional health service within one (1) year of the date of approval of such new institutional health service unless otherwise specifically conditioned in the state agency decision shall be grounds for review by the Health Services Council and the state agency to determine if approval should be withdrawn.

E. Failure to provide summary progress reports as required in § 22.15(A)(8) of this Part shall be grounds for review by the Health Services Council and the state agency to determine if approval should be withdrawn.

F. Failure to demonstrate that sufficient progress is being made toward project completion as evidenced in the summary progress reports as required in § 22.15(A)(8) of this Part shall be grounds for review by the Health Services Council and the state agency to determine if approval should be withdrawn.

G. Withdrawal of approval for failure to initiate development or to execute a construction contract in accordance with §§ 22.16(C) or 22.16(D) of this Part shall preclude the applicant whose approval has been withdrawn from being considered as an existing or potential provider of the new institutional health service or new health care equipment for which approval was withdrawn, in the context of application by the Health Services Council of the considerations listed in § 22.10(K) of this Part to pending or subsequent applications for similar services by other persons or health care facilities.

H. In conducting reviews in accordance with §§ 22.16(C) through 22.16(F) of this Part, the state agency shall provide written notification to the applicant and the Health Services Council stating the grounds, scope and procedures for initiating withdrawal of the certificate of need. Within thirty (30) days from the date of notification, the applicant shall provide written justification to the state agency for failure to implement or to demonstrate that sufficient progress is being made toward project completion in accordance with §§ 22.16(C) through (F) of this Part. Upon receipt of this written justification or following the expiration of the allowed thirty (30) day period, the state agency shall forward said justification if furnished and other pertinent materials to the Health Services Council for review and recommendation. When practicable, the Health Services Council shall provide the state agency with a recommendation within forty-five (45) days of the receipt of the applicant's written justification if furnished regarding the failure to implement a project. The scope of the Health Services Council review and recommendation shall be limited to:

1. The specific circumstances resulting in failure to implement or to make sufficient progress toward project completion; and

2. The impact of this failure to implement or to make sufficient progress toward project completion on the public need for said services. Decisions by the state agency with respect to withdrawal of approval shall be rendered within thirty (30) days of the completion of the Health Services Council's review and recommendation, when practicable.

I. The decision of the state agency rendered in accordance with this section is subject to the reconsideration and/or administrative review and/or judicial review outlined in §§ 22.17 through 22.19 of this Part.

J. In the case of a decision by the state agency to disapprove any changes or cost overruns, sanctions available under R.I. Gen. Laws § 23-15-4(h) of the Act shall apply only to the costs associated with the changes and/or overruns disapproved thereby.

Notes

216 R.I. Code R. 216-RICR-40-10-22.16