42 U.S. Code § 1320a–1 - Limitation on use of Federal funds for capital expenditures
The purpose of this section is to assure that Federal funds appropriated under subchapters XVIII and XIX are not used to support unnecessary capital expenditures made by or on behalf of health care facilities which are reimbursed under any of such subchapters and that, to the extent possible, reimbursement under such subchapters shall support planning activities with respect to health services and facilities in the various States.
The Secretary shall pay any such State from the general fund in the Treasury, in advance or by way of reimbursement as may be provided in the agreement with it (and may make adjustments in such payments on account of overpayments or underpayments previously made), for the reasonable cost of performing the functions specified in subsection (b).
Where a person obtains under lease or comparable arrangement any facility or part thereof, or equipment for a facility, which would have been subject to an exclusion under subsection (d) if the person had acquired it by purchase, the Secretary shall (1) in computing such person’s rental expense in determining the Federal payments to be made under subchapters XVIII and XIX with respect to services furnished in such facility, deduct the amount which in his judgment is a reasonable equivalent of the amount that would have been excluded if the person had acquired such facility or such equipment by purchase, and (2) in computing such person’s return on equity capital deduct any amount deposited under the terms of the lease or comparable arrangement.
Any person dissatisfied with a determination by the Secretary under this section may within six months following notification of such determination request the Secretary to reconsider such determination. A determination by the Secretary under this section shall not be subject to administrative or judicial review.
For the purposes of this section, a “capital expenditure” is an expenditure which, under generally accepted accounting principles, is not properly chargeable as an expense of operation and maintenance and which (1) exceeds $600,000 (or such lesser amount as the State may establish), (2) changes the bed capacity of the facility with respect to which such expenditure is made, or (3) substantially changes the services of the facility with respect to which such expenditure is made. For purposes of clause (1) of the preceding sentence, the cost of the studies, surveys, designs, plans, working drawings, specifications, and other activities essential to the acquisition, improvement, expansion, or replacement of the plant and equipment with respect to which such expenditure is made shall be included in determining whether such expenditure exceeds the dollar amount specified in clause (1).
The provisions of this section shall not apply to a religious nonmedical health care institution (as defined in section 1395x(ss)(1) of this title).
The Public Health Service Act, referred to in subsec. (b), is act July 1, 1944, ch. 373, 58 Stat. 682, which is classified generally to chapter 6A (201 et seq.) of this title. For complete classification of this Act to the Code, see Short Title note set out under section 201 of this title and Tables.
1997—Subsec. (h). Pub. L. 105–33 substituted “a religious nonmedical health care institution (as defined in section 1395x(ss)(1) of this title).” for “Christian Science sanatoriums operated, or listed and certified, by the First Church of Christ, Scientist, Boston, Massachusetts.”
1984—Subsec. (b). Pub. L. 98–369, § 2354(a)(1), substituted a comma for the period at end of par. (1), and struck out “(or the Mental Retardation Facilities and Community Mental Health Centers Construction Act of 1963)” before “to meet the need” in provisions following par. (3).
Subsec. (i)(3). Pub. L. 98–369, § 2354(a)(2), substituted “5703” for “5703(b)”.
1983—Subsec. (c). Pub. L. 98–21, § 607(a), substituted “the general fund in the Treasury” for “the Federal Hospital Insurance Trust Fund”.
Subsec. (g). Pub. L. 98–21, § 607(b)(1), substituted “$600,000 (or such lesser amount as the State may establish)” for “$100,000” and Pub. L. 98–21, § 607(b)(1)(B), substituted “the dollar amount specified in clause (1)” for “$100,000” the second time it appeared.
Subsec. (j). Pub. L. 98–21, § 607(c), added subsec. (j).
1982—Subsec. (d)(2). Pub. L. 97–248 amended directory language of Pub. L. 97–35, § 2193(c)(3)(B), to correct typographical error, and did not involve any change in text. See 1981 Amendment note below.
1981—Subsec. (a). Pub. L. 97–35, § 2193(c)(3)(A), substituted “subchapters XVIII and XIX” for “subchapters V, XVIII, and XIX”.
Subsec. (d)(1). Pub. L. 97–35, § 2193(c)(3)(A), substituted in provision following subpar. (B)(ii)(II) “subchapters XVIII and XIX” for “subchapters V, XVIII, and XIX” in two places.
Subsec. (e). Pub. L. 97–35, § 2193(c)(3)(A), substituted “subchapters XVIII and XIX” for “subchapters V, XVIII, and XIX”.
Subsec. (d). Pub. L. 95–559, § 14(b)(1), (3), as amended by Pub. L. 96–32, struck out references to health maintenance organizations wherever appearing and in par. (2) “or organization, or of any facility of such organization,” after “expansion of such facility”.
1973—Subsec. (d)(1). Pub. L. 93–233, § 18(z), inserted “or a fixed fee or negotiated rate” after “per capita” wherever appearing in last sentence.
Subsec. (d)(2). Pub. L. 93–233, § 18(z–1), substituted “exclude” for “include” where last appearing.
Amendment by Pub. L. 105–33 effective Aug. 5, 1997, and applicable to items and services furnished on or after such date, with provision that Secretary of Health and Human Services issue regulations to carry out such amendment by not later than July 1, 1998, see section 4454(d) of Pub. L. 105–33, set out as an Effective Date note under section 1395i–5 of this title.
Amendment by Pub. L. 97–248 effective as if originally included as part of this section as this section was amended by the Omnibus Budget Reconciliation Act of 1981, Pub. L. 97–35, see section 137(d)(2) of Pub. L. 97–248, set out as a note under section 1396a of this title.
Advisory councils in existence on Jan. 5, 1973, to terminate not later than the expiration of the 2-year period following Jan. 5, 1973, unless, in the case of a council established by the President or an officer of the Federal Government, such council is renewed by appropriate action prior to the expiration of such 2-year period, or in the case of a council established by the Congress, its duration is otherwise provided by law. Advisory councils established after Jan. 5, 1973, to terminate not later than the expiration of the 2-year period beginning on the date of their establishment, unless, in the case of a council established by the President or an officer of the Federal Government, such council is renewed by appropriate action prior to the expiration of such 2-year period, or in the case of a council established by the Congress, its duration is otherwise provided by law. See sections 3(2) and 14 of Pub. L. 92–463, Oct. 6, 1972, 86 Stat. 770, 776, set out in the Appendix to Title 5, Government Organization and Employees.
References in laws to the rates of pay for GS–16, 17, or 18, or to maximum rates of pay under the General Schedule, to be considered references to rates payable under specified sections of Title 5, Government Organization and Employees, see section 529 [title I, § 101(c)(1)] of Pub. L. 101–509, set out in a note under section 5376 of Title 5.
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