Substantial Capital Expenditure and Substantial Change in Service

Pursuant to M.G.L. c. 111, § 25C, no Person may make a Substantial Capital Expenditure or a Substantial Change in Service, unless the Department has first issued a Notice of Determination of Need. (A) Substantial Capital Expenditure. Effective October 1, 2019, an Application for Substantial Capital Expenditure must be submitted when the total of any Capital Expenditures, excluding those Capital Expenditures consisting of construction defined as a Conservation Project, by a Health Care Facility, as that term is defined in 105 CMR 100.100, for any construction that requires Department approval, either through a Notice of Determination of Need or through the submission and approval of architectural plans and specifications as required by M.G.L. c. 111, § 51, reasonably forseeable during the course of a single Federal Fiscal Year, exceed, or may be reasonably regarded as likely to exceed, the Expenditure Minimum with Respect to Substantial Capital Expenditures when consolidated over the course of a single Federal Fiscal Year. Such Applications must also include all proposed Substantial Changes in Service consolidated over the same Federal Fiscal Year. An Applicant may separately submit an Application for those Capital Expenditures consisting solely of construction defined as a Conservation Project that, when consolidated over the course of a single Federal Fiscal Year, exceed the Expenditure Minimum with Respect to Substantial Capital Expenditures. A Hospital or comprehensive cancer center, as that term is defined in M.G.L. c. 118E, § 8A, may separately submit an Application for Substantial Capital Expenditure for those Capital Expenditures concerned solely with outpatient services other than Ambulatory Surgery and not otherwise defined by the Department as DoN-required Equipment or DoN-required Services; provided that such an Application includes all such reasonably foreseeable Capital Expenditures across all locations on the Health Care Facility License that exceed the Expenditure Minimum with Respect to Substantial Capital Expenditures when consolidated over the course of a single Federal Fiscal Year. Such Applications must also include all planned Substantial Changes in Service consolidated over the same Federal Fiscal Year. (B) Substantial Change in Service. Effective October 1, 2019, a Health Care Facility, as that term is defined in 105 CMR 100.100, that is not required to submit an application under 105 CMR 100.715(A) but proposes any reasonably foreseeable Substantial Change in Service over the course of a single Federal Fiscal Year, must submit an Application for any Substantial Change in Service that consolidates all such Substantial Changes in Service at the Health Care Facility over that Federal Fiscal Year. A Hospital or comprehensive cancer center, as that term is defined in M.G.L. c. 118E, § 8A, may separately submit an Application for Substantial Change in Service for outpatient services; provided that such an Application consolidates all such reasonably foreseeable Substantial Changes in Service across all locations on the Health Care Facility License over the course of a single Federal Fiscal Year. (1) DoN-required Services and DoN-required Equipment. (a) Maintenance or replacement of existing equipment defined as a DoN-required Equipment shall not require a Notice of Determination of Need. (b) When considering a proposed Addition, Expansion, or Conversion of an existing DoN-required Service or DoN-required Equipment, the Department shall first deem that such services or equipment were established or acquired pursuant to a properly issued Notice of Determination of Need. (2) Ambulatory Surgery. (a) No Person shall be issued a Notice of Determination of Need inclusive of Ambulatory Surgery, unless the Proposed Project, as it relates to Ambulatory Surgery, constitutes: 1. Surgery capacity located on the main campus of an existing Hospital for which the Applicant has or is a participant in a Certified ACO; 2. An Expansion, Conversion, Transfer of Ownership, transfer of Site, or change of designated Location for Ambulatory Surgery capacity located on a satellite campus of an existing Hospital for which the Applicant has or is a participant in a Certified ACO; 3. Freestanding Ambulatory Surgery Center, that is an Affiliate of, or joint venture with an Entity that has or participates in, a Certified ACO; or, 4. An Expansion, Conversion, Transfer of Ownership, transfer of Site, or change of designated Location for a Freestanding Ambulatory Surgery Center that received an Original License as a Clinic on or before January 1, 2017. (b) For any Application for Notice of Determination of Need made pursuant to 105 CMR 100.715(B)(2)(a) 1. 2. or 3. hich includes a Proposed Project within the Primary Service Area of an existing Hospital that is: 1. designated as an independent community disproportionate share or non- disproportionate share Hospital as defined by HPC’s Massachusetts Hospital Cohort Designation and Affiliation Status, and 2. not an existing joint venture or Affiliate of the Applicant: a. The Proposed Project must constitute a joint venture with the independent community disproportionate share or non-disproportionate share Hospital; or b. The Applicant must obtain a letter of support signed by the independent community disproportionate share or non-disproportionate share Hospital’s chief executive officer and board chair. (3) Pursuant to M.G.L. c. 111, § 25C, no Person may acquire by purchase, lease, or other arrangement a unit of medical, diagnostic, or therapeutic equipment for a Location other than a Health Care Facility, which has a fair market value in excess of $250,000, adjusted annually by the Commissioner after consideration of any inflation index established by the U.S. Department of Health and Human Services and set forth by the Commissioner in an informational bulletin, unless the Person first notifies the Department in writing at least 60 days prior to the acquisition of, or implementation of contractual arrangements for the acquisition of the equipment. If the Person fails to notify the Department, or if such acquisition meets the definition of a Substantial Change in Service, the Commissioner shall order the filing of an Application for Determination of Need.