Code of Federal Regulations: Containing a Codification of Documents of ...

a time. A grantee must submit a separate application to have the support continued for each subsequent year. Decisions regarding continuation awards and the funding level of such awards will be of such factors as the grantee's progress and management practices, and the availability of funds. In all cases, continuation awards require a determination by the Secretary that continued funding is in the best interest of the Federal Government.

(c) Neither the approval of any application, nor the award of any grant commits or obligates the Federal Government in any way to make any additional, supplemental, continuation, or other award with respect to any approved application or portion of an approved application.

Several other regulations apply to grants under this part. These include, but are not limited to:

42 CFR Part 50-Subpart D-PHS grant appeals procedure.

45 CFR Part 16-Department grant appeals process.

45 CFR Part 46-Protection of human subjects.

45 CFR Part 74-Administration of grants. 45 CFR Part 75-Informal grant appeals procedures (indirect cost rates and other cost allocations).

45 CFR Part 80-Nondiscrimination under programs receiving Federal assistance through the Department of Health and Human Services-Effectuation of Title VI of the Civil Rights Act of 1964. 45 CFR Part 81-Practice and procedure for hearings under Part 80.

45 CFR Part 84-Nondiscrimination on the basis of handicap in federally assisted programs.

45 CFR Part 91'-Nondiscrimination on the basis of age in programs or activities receiving Federal financial assistance from HHS.

'Refer to 45 CFR Part 90 until Part 91 is issued.

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 $100,000.

(ii) For purposes of paragraph (a)(1)(i) of this section, where the estimated cost of a proposed project, including cost escalation factors appropriate to the area in which the project is located, is, within 60 days of the date on which the obligation for such expenditure is incurred, certified by a licensed architect or engineer to be $100,000 or less, such expenditure shall be deemed not to exceed $100,000 regardless of the actual cost of such project: Provided, that, In any such case where the actual cost of the project exceeds $100,000, the health care facility or health maintenance organization on whose behalf such expenditure is made shall provide written notification of such cost to the designated planning agency not more than 30 days after the date on which such expenditure is incurred. Such notification shall include a copy of the certified estimate.

(iii) For purposes of paragraph (a)(1)(ii) of this section, a capital expenditure which "changes the bed capacity" of a facility means a capital expenditure which results in any increase or decrease in licensed capacity under applicable State or local law, or, if there is no such law, the number of beds in a given facility as of January 1, 1973, as determined by the designated planning agency.

(iv) For purposes of paragraph (a)(1)(iii) of this section, a capital expenditure which "substantially changes the services" of a facility means a capital expenditure which results in the addition of a clinically related (i.e., diagnostic, curative, or rehabilitative) service not previously provided in the facility or the termination of such a service which had previously been provided in the facility. The addition of computed tomographic (CT) scanner services not previously provided in or through the facility is a substantial change of services within the meaning of this subparagraph, whether these services are provided through a fixed or mobile CT scanner.

The addition of CT full-body scanner services is included in the previous sentence if it is added to or replaces existing CT head scanner services.

(v) Any change in a proposed capital expenditure which itself meets the criteria set forth in this paragraph, shall, for purposes of this subpart, be deemed a capital expenditure; Provided, That an increase or decrease in the cost of a proposed capital expenditure which increase or decrease is not related to a change in bed capacity or a substantial change in services may, at the option of the designated planning agency, be exempt from review under this subpart.

(b) Where a person obtains, under lease or comparable arrangement, or through donation, any facility or part thereof, or equipment for a facility, the expenditure for which would have been considered a capital expenditure and subject to exclusion from reimbursement under titles V, XVIII, and XIX of the Act pursuant to this subpart if the person had acquired it by purchase, such acquisition shall be deemed a capital expenditure by or on behalf of such facility and the Secretary shall, subject to section 1122(d) of the Act:

(1) In the case of a lease or comparable arrangement, (i) in computing such person's rental expense, in determining the Federal payments to be made under such titles V, 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 equipment by purchase; and

(ii) In computing such person's return on equity capital, deduct any amount deposited under the terms of the lease or comparable arrangement; and

(2) In the case of a donation which is carried by such person as a capital asset, exclude from reimbursement for services provided under titles V, XVIII, and XIX any amount claimed for depreciation on such facility or equipment, and other costs related to its acquisition.

(c) Obligation: An obligation for a capital expenditure shall be deemed to

skilled nursing care and related services for patients who require medical or nursing care, or rehabilitation services for the rehabilitation of injured, disabled, or sick persons.

(5) The term "intermediate care facility" means an institution which provides, on a regular basis, health-related care and services to individuals who do not require the degree of care and treatment which a hospital or skilled nursing facility is designed to provide, but who because of their mental or physical condition require health-related care and services (above the level of room and board).

(6) The term "ambulatory surgical facility" means a facility, not a part of a hospital, which provides surgical treatment to patients not requiring hospitalization. Such term does not include the offices of private physicians or dentists, whether for individual or group practice.

(f) "Health maintenance organization" means a public or private organization, organized under the laws of any State, which

(1) Provides or otherwise makes available to enrolled participants health care services, including at least the following basic health care services: Usual physician services, hospitalization, laboratory, X-ray, emergency and preventive services, and out-ofarea coverage;

(2) Is compensated (except for copayments) for the provision of the basic health care services listed in paragraph (f)(1) of this section to enrolled participants on a predetermined periodic rate basis; and

(3) Provides physicians' services priImarily (i) directly through physicians who are either employees or partners of such organization, or (ii) through arrangements with individual physicians or one or more groups of physicians (organized on a group practice or individual practice basis).

[38 FR 31381, Nov. 13, 1973, as amended at 42 FR 4024, Jan. 21, 1977]

§ 100.103 Expenditures covered.

Any capital expenditure proposed by or on behalf of any health care facility or health maintenance organization, the obligation for which is incurred by or on behalf of a health care facility

or health maintenance organization after December 31, 1972, or after the effective date of the agreement entered into pursuant to § 100.104 by the Secretary and the State in which the health care facility or health maintenance organization is located (which effective date may, at the option of the State, be earlier than the date on which such agreement is entered into where the Secretary finds that the procedure utilized by the State for review of proposed capital expenditures as of such earlier date satisfies the requirements of section 1122 and this subpart), whichever is later, is subject to this subpart: Provided, that, In the case of a health care facility providing health care services as of December 18, 1970, which on such date is committed to a formal plan of expansion or replacement, this subpart shall not apply with respect to such expenditures as may be made or such obligations as may be incurred for capital items included in such plan where preliminary expenditures toward the plan of expansion or replacement (including payments for studies, surveys, designs, plans, working drawings, specifications, and site acquisition, essential to the acquisition, improvement, expansion, or replacement of the health care facility or equipment concerned) of $100,000 or more, had been made during the three-year period ended December 17, 1970.

(a)(1) For purposes of this subpart, a "capital expenditure" is an expenditure, including a force account expenditure (i.e., an expenditure for a construction project undertaken by the facility as its own contractor), which, under generally accepted accounting principles, is not properly chargeable as an expense of operation and maintenance and which (i) exceeds $100,000, or (ii) changes the bed capacity of the facility with respect to which such expenditure is made, or (iii) substantially changes the services of the facility with respect to which such expenditure is made.

(2)(i) For purposes of paragraph (a)(1)(i) of this section, the cost of studies, surveys, designs, plans, working drawings, specifications, and other activities essential to the acquisition,