Code of the District of Columbia

§ 44–401. Definitions.

For the purposes of this chapter, the term:

(1) “Acquiring of effective control” means:

(A) Any transfer, assignment or other disposition of 50% or more of the stock, voting rights thereunder, ownership interest, or operating assets of a corporation or other entity which is a HCF or is the operator or owner of a HCF;

(B) Any transaction which results in any person, or any group of persons acting in concert, owning or controlling, directly or indirectly, 50% or more of the stock, voting rights thereunder, ownership interest, or operating assets of such a corporation or other entity;

(C) Any transaction which results in any person, or any group of persons acting in concert, having the ability to elect or cause the election of a majority of the board of directors of such a corporation; or

(D) Any conversion which results in the selling, transferring, leasing, exchanging, conveying, or otherwise disposing of, directly or indirectly, all the assets or a material amount of the assets, as defined by § 44-602, of a nonprofit HCF to a for-profit entity whether a corporation, mutual benefit corporation, limited liability partnership, general partnership, joint venture, or sole proprietorship, including such an entity that results from, or is created in connection with, the conversion.

(2) “Annual Implementation Plan” means the plan prepared annually by the State Health Planning and Development Agency and the Statewide Health Coordinating Council to specify actions which will achieve the goals and objectives of the Health Systems Plan.

(2A)(A) “Bad debt” means an account receivable based on physician and hospital medical services furnished to any patient for which payment is:

(i) Expected, but is regarded as uncollectible following reasonable collection efforts; and

(ii) Not the obligation of any federal, state, or local governmental unit.

(B) The term “bad debt” does not include charity care.

(3)(A) "Capital expenditure" means:

(i) Any expenditure by or on behalf of a hospital, including a private general, rehabilitation, or psychiatric or other specialty hospital that is, under generally accepted accounting principles, not properly chargeable as an expense of operation or maintenance and exceeds $6 million; except, that the SHPDA may, by rule, adjust this threshold annually to reflect the change in the Hospital Construction Cost Index issued by the U.S. Department of Commerce;

(ii) For all health care facilities not specified in sub-subparagraph (i) of this subparagraph, any expenditure by or on behalf of a health care facility, or by or on behalf of a person that is, under generally accepted accounting principles, not properly chargeable as an expense of operation or maintenance and exceeds $3.5 million; except, that the SHPDA may, by rule, adjust this threshold annually to reflect the change in the Hospital Construction Cost Index issued by the U.S. Department of Commerce;

(iii) Any expenditure for the acquisition of major medical equipment;

(iv) Any expenditure for any acquisition under a lease or comparable arrangement, or through any other type of transfer that would have constituted a capital expenditure under this paragraph if the acquisition had been made at fair market value;

(v) Any expenditure for any acquisition under a lease, comparable arrangement, through donation, or through any other type of transfer by 2 or more persons acting in concert, where the aggregate cost of the acquisition would have constituted a capital expenditure under this paragraph if the acquisition had been by purchase at fair market value, notwithstanding that the cost or value to each participating person of the acquisition would not, alone, constitute a capital expenditure under this paragraph; and

(vi) Any expenditure for any action or combination of related actions by a person or by 2 or more persons acting in concert that results in acquiring effective control of a health care facility or any other corporation, partnership, limited liability company, or other entity that holds a certificate of need and which would have constituted a capital expenditure under this paragraph if the acquisition or intended acquisition had been by purchase at a fair market value.

(B) For purposes of this paragraph, the cost of studies, appraisals, charitable donations, title searches, in-kind contributions, Internal Revenue Service 1031 exchanges, acquisition of contracts, supplies and equipment, surveys, designs, plans, working drawings, specifications, site preparation, construction, related equipment, legal fees, and other activities essential to or related to the capital expenditure shall be included in determining the total costs of the expenditure.

(3A) "Certificate of need" means a document obtained from the SHPDA that demonstrates a public need for the new service or expenditure, as described in § 44-406(a).

(3B) “Charity care” means the physician and hospital medical services provided to persons who are unable to pay for the cost of services, especially those persons who are low-income, uninsured and underinsured, but excluding those services determined to be caused by, or categorized as, bad debt.

(4) Repealed.

(5) Repealed.

(6) Repealed.

(6A) “Department” means the Department of Health.

(6B)(A) “Diagnostic health care facility” means:

(i) A diagnostic imaging center accredited by the American College of Radiology whose primary business is the provision of diagnostic imaging services to the public;

(ii) A cardiac catheterization laboratory;

(iii) A radiation therapy facility; or

(iv) An independent diagnostic laboratory whose primary business is the provision of diagnostic imaging services to the public and at which at least 3 of the following exams are performed:

(I) Magnetic resonance imaging;

(II) CAT scan;

(III) Nuclear medicine;

(IV) Ultrasound;

(V) X-ray; or

(VI) Mammography.

(B) The term “diagnostic health care facility” shall not include the offices of private physicians, whether in individual or group practice.

(7) “Director” means the director of the SHPDA established by § 44-402.

(7A) “Director of the Department of Mental Health” means the Director of the Department of Mental Health established by § 7-1131.03.

(8) “District government” means the government of the District of Columbia.

(9) “Ex parte contact” means an oral or written communication not on the official record where reasonable contemporaneous notice to all parties is not given.

(9A) “Expedited administrative review” means a review conducted by the SHPDA staff, using the same criteria and standards that apply to projects reviewed through use of the regular process, the results of which are reported to the SHCC at the next regularly scheduled SHCC meeting.

(10) “Health care facility” (“HCF”) means any private general hospital, psychiatric hospital, other specialty hospital, rehabilitation facility, skilled nursing facility, intermediate care facility, ambulatory care center or clinic, ambulatory surgical facility, kidney disease treatment center, freestanding hemodialysis facility, diagnostic health care facility home health agency, hospice, or other comparable health care facility which has an annual operating budget of at least $500,000. “Health facility” shall not include Christian Science sanitariums operated, listed, and certified by the First Church of Christ Scientist, Boston, Massachusetts; the private office facilities of a health professional or group of health professionals, where the health professional or group of health professionals provides conventional office services limited to medical consultation, general non-invasive examination, and minor treatment, or a health care facility licensed or to be licensed as a community residence facility, or an Assisted Living Residence as defined by § 44-102.01.

(11) “Health Maintenance Organization” (“HMO”) means a private organization which is a qualifying HMO under federal regulations or has been determined to be an HMO pursuant to rules issued by the SHPDA in accordance with this chapter.

(12) “Health service” means any medical or clinical related service, including services that are diagnostic, curative, or rehabilitative, as well as those related to inpatient mental health services, home health care, hospice care, medically supervised day care, and renal dialysis. The term “health service” shall not include those outpatient behavioral health services subject to the exclusive regulatory authority of the Department of Behavioral Health and services provided by physicians, dentists, HMOs, and other individual providers in individual or group practice.

(13) “Health Systems Plan” (“HSP”) means the comprehensive health plan prepared by the SHPDA and the SHCC in accordance with this chapter.

(14)(A) "Major medical equipment" means:

(i) For private general, rehabilitation, or psychiatric or other specialty hospitals, equipment used for the provision of medical or other health services that is acquired by lease, purchase, donation, or other comparable arrangement by or on behalf of such hospitals, and has a fair market value in excess of $3.5 million; except, that the SHPDA may, by rule, adjust this threshold annually to reflect the change in the Consumer Price Index issued by the Bureau of Labor Statistics, United States Department of Labor;

(ii) For all health care facilities not specified in sub-subparagraph (i) of this subparagraph, equipment used for the provision of medical or other health services that is acquired by lease, purchase, donation, or other comparable arrangement by or on behalf of a health care facility, or by or on behalf of any private group practice of diagnostic radiology or radiation therapy and has a fair market value in excess of $2 million; or

(iii) A single piece of diagnostic or therapeutic equipment that is acquired by lease, purchase, donation, or other comparable arrangement by or on behalf of a physician or group of physicians (excluding those referenced in sub-subparagraph (i) of this subparagraph), or an independent owner or operator of the equipment, and has a fair market value is in excess of $350,000.

(B) In determining whether medical equipment has a fair market value in excess of the amount specified in subparagraph (A)(i) of this paragraph, the cost of studies, surveys, designs, plans, working drawings, specifications, site preparation, construction, related equipment, and other activities essential to the acquisition of the equipment shall be included.

(C) The term "major medical equipment" does not include medical equipment acquired by or on behalf of a clinical laboratory to provide clinical laboratory services if the clinical laboratory is independent of a physician's office or a hospital and meets the requirements of section 1861(s)(10) and (11) of the Social Security Act, approved August 14, 1935 (49 Stat. 420; 42 U.S.C. 1395x(s)).

(15) “New institutional health service” means:

(A) The construction, development, or other establishment of:

(i) A health care facility;

(ii) A home health or home nursing service;

(iii) Any new health service; or

(iv) A change in the licensed bed capacity of a facility by 10 beds or 10%, whichever is less, within a 2-year period.

(B) Any health service offered by or on behalf of a HCF and which was not offered on a regular basis by the HCF within the 12-month period prior to the time the service would be offered or which involves an operating budget of at least $600,000 in direct costs for the first year of operation, except that the SHPDA may, by rule, adjust this threshold annually to reflect the change in the medical care component of the Consumer Price Index issued by the Bureau of Labor Statistics, U.S. Department of Labor, or which results in a capital expenditure in any amount.

(16) “Person” means an individual, a trust, or estate, a partnership, or a corporation (including associations, joint stock companies, and insurance companies), the District government, or an agency, subdivision, or instrumentality of the District government.

(17) “Social Security Act” means the Social Security Act, approved August 14, 1935, as amended (49 Stat. 520; 42 U.S.C. 301 et seq.)

(18) “Statewide Health Coordinating Council” (“SHCC”) means the Statewide Health Coordinating Council established by § 44-403 to advise the State Health Planning and Development Agency on certain health planning functions as specified in this chapter.

(19) “State Health Planning and Development Agency” (“SHPDA”) means the agency for the District of Columbia within the Commission of Public Health responsible for carrying out the District government’s health planning and development program established by § 44-402.

(20) “Uncompensated care” means the cost of health care services rendered to patients for which the health care facility does not receive payment. The term “uncompensated care” includes bad debt and charity care, but does not include contractual allowances.