9. Hearings for Project Reviews at State and Local Levels Sections 1522 (b), 1532(a) and 1532(b)

a. Policy Position. American Hospital Association supports an amendment to the National Health Planning and Resources Development Act to require a public forum for all interested parties who desire to participate in project reviews at the local level and to permit either the HSA or the applicant to request a formal hearing prior to any decision being made at the state level in a certificate of need or Section 1122 project review or in a review of the appropriateness of institutional health services.

b. Rationale. Although Section 1532(8) of the statute requires public hearings
during the course of project reviews and appropriateness reviews, it is vague
as to the stage of the proceedings at which such hearings shall take place.
There is also a requirement for public hearings "for good cause shown" after
HSA and State Agency decisions, but, again, the timing and location are not
specified. We suggest that it would be appropriate to provide for one public
hearing at the local level, at which all interested persons would have the
opportunity to make statements or present evidence with respect to the applica-
tion or other review. To provide the maximum opportunity for such participation,
such a hearing should be well publicized, informal in nature and conducted in
the local community. A summary, although not a verbatim transcript, should be
made, which should become part of the record of the total review process, and
form part of the basis for the recommendations of the HSA and the decisions of
the State Agency.

A second public hearing would generally tend to be merely repetitious of the
statements and comments made at the first. However, there ought to be an
opportunity for either the applicant or the HSA to request a formal hearing
conducted by the State Agency prior to its decision. The interests of fairness
and equity then would require that the decision be appealable by either party
to the formal hearing, to a state agency other than the State Health Planning
and Development Agency and thence to the courts to the extent provided by state
law. At present, such an appeal is provided to the health systems agency only
if the SHPDA decision is inconsistent with HSA recommendations. The existence
of a right of appeal on the part of a project sponsor depends upon state law
and on whether review is being conducted under Section 1122 of the Social
Security Act or under a state certificate of need program. There are no pro-
visions for institutions to appeal adverse findings made in the course of
appropriateness reviews, even though these can have serious detrimental effects.
The amendments proposed will: (i) consolidate all the P.L.93-641 requirements
for review procedures into Section 1532, where the bulk of them now appear;
(ii) require that the procedures for the different kinds of reviews be harmonized,
to the extent permitted by the statutes under which the reviews are being con-
ducted, making it clear that the regulatory process must not contravene statutory
requirements; (iii) provide for a public forum to be conducted by the health
systems agency, at which all interested persons may appear and present state-
ments or evidence concerning the review being conducted; (iv) require a formal
hearing prior to the decision of the State Agency, at the request of either the
health systems agency or the sponsor of a project or the institution whose ser-
vices are being reviewed for their appropriateness.

C.

Legislative Language. The following specific legislative language is
proposed to accomplish the changes in the National Health Planning
and Resources Development Act set forth above.

HEARINGS AND PROCEDURES

SECTIONS 1522 (b), 1532 (a) and 1532 (b)

"State Administrative Program

"Section 1522(b). The State Program of a State must

(13)-provide-that-if-the-State-Agency -makes-a decision-in-the-performance of-a-function-under-paragraph-(8), -(4), -(5), -or- (6) -of-Section-1535(a)-or under-title-XVI-which-is-inconsistent-with-a-FeGoRendation -made-under Subsection (f);-(g); -or- (h)-of-Section-1513-by-a-health-s -systems-agency with-the-State--

(A)-such-decision-(and-the-record-upon-which-it-was-made)-shall, mechanism-eensistent-with-State-law-governing-the-practices-and-procedures of-administrative-agencies,-by-an-agency-of-the-State-(other-than-the-State health-planning-and-development-agency)-designated-by-the-Governor,-and

upen-request-of-the-health-systems-agency, -be-reviewed, -under-an-appeals

(B)-the-decision-of-the-reviewing-agency-shall-for-purposes-of-this title-and-title-XVI-be-considered-the-decision-of-the-State-health-planning

and-development-agency="

"Procedures and Criteria for Reviews of Proposed Health System Changes

"Section 1532. (a) In conducting reviews pursuant to Subsections (e), (f), and (g) of Section 1513 or in conducting any other reviews of proposed or existing health services, each health systems agency shall (except to the extent approved by the Secretary) follow procedures, and apply criteria, developed and published by the agency in accordance with regulations of the Secretary; and in performing its review functions under Section 1523, a State Agency shall (except to the extent approved by the Secretary) follow procedures, and apply criteria, developed and published by the State Agency in accordance with regulations of the Secretary. Procedures and criteria for reviews by health systems agencies and States Agencies must be in accordance with the State and Federal statutes pursuant to which such reviews are being conducted, but may vary according to the purpose for which a particular review is being conducted or the type of health services being reviewed.

(b) Each health systems agency and State Agency shall include in the procedures required by Subsection (a) at least the following:

(8) Provision for public hearings in the course of agency review at which members of the public shall have opportunity to make

statements and present relevant evidence; er provision for formal hearings to be conducted by the State Agency if requested by persons-directly affected-by-the-review; the agency or the entity proposing the project or whose services are being reviewed; and provision for public-hearings;-for good-cause-shown; respecting-agency-and-State-Ageney-decisions: review of any decision by a State Agency in any matter subject to Subsection 1532 (a) at the request of the health systems agency or of the entity offering or proposing to offer the services being reviewed, under an appeals mechanism consistent with State law governing the practices and procedures of administrative agencies, by an agency of the State (other than the state health planning and development agency) designated by the Governor and, to the extent provided by State law, to the courts of the state. The decision of the reviewing agency or court shall, for purposes of this title, title XVI and Section 1122 of the Social Security Act be considered the decision of

the state health planning and development agency;

10. Phase In of Functions of Health Systems Agencies Section 1513(b)

a. Policy Position. The American Hospital Association supports an amendment to ensure that agencies do not perform functions which are beyond their capability.

b. Rationale. The purpose of this amendment is to permit Health Systems Agency (HSA) Functions to be phased in, in accordance with staff expertise and availability of funds. DHEW should evaluate each applicant's proposed work program according to the agency's level of expertise and financing. The magnitude of the tasks listed as functions of a Health Systems Agency is overwhelming. If Health Systems Agencies are permitted to phase-in their programs in an orderly manner, and are not mandated to attempt to perform functions that are beyond their capabilities and available resources, the credibility and effectiveness of the Health Systems Agencies will be greatly enhanced.

For example, we have recommended that the appropriateness review functions be deleted as it is felt that in the absence of adequate staffing or adequate funding a review of this magnitude would be prohibitive. In the event that our recommendation for deletion of the appropriateness review is not followed as one of the functions of an HSA and State Agency, we believe that this is a prime example of a function which should be phased in after all other functions are in place. The Health Systems Agencies have numerous tasks to perform. Should they try to accomplish all these tasks simultaneously the efforts in each of them will be less than satisfactory.

c. Legislative Language. The following is proposed legislative language to amend the National Health Planning and Resources Development Act in accord with the above policy:

PHASE IN FUNCTIONS OF HEALTH SYSTEMS AGENCIES
SECTION 1513(b)

"(b) In providing health planning and resources development for its health service area, a health systems agency shall perform, to the extent that its capabilities and approved work program permit, the following functions: (1) The agency shall assemble and analyze data concerning-

"(A) the status (and its determinants) of the health of the residents of its health service area.

"(B) the status of the health care delivery system in the area and the use of that system by the residents of the area,

"(C) the effect the area's health care delivery system has on

the health of the residents of the area.

"(D) the number, type, and location of the area's health resources, including health services, manpover, and facilities.

and,

"(E) the patterns of utilization of the area's health resources,

"(F) the environmental and occupational exposure factors affecting immediate and long-term health conditions."

11. Composition of National Council on Health Planning and Development Section 1503(b) (1)

a. Policy Position. The American Hospital Association supports an amendment to ensure hospital representation at the national level.

b. Rationale. As the legislation is now written, there is no provision to ensure adequate representation of hospital provider interests at the national level of the planning structure. Hospitals may therefore, be represented by someone who is not directly involved in health care delivery in hospitals and would not necessarily be in the best position to represent hospital needs. The underlying philosophy of the statute is that health care policy is to be developed through a coalition of representative consumer and provider interests. Because the nature of the representation categories is so broad and the various provider categories are so extensive, the possibility exists that the National Council could be composed of providers excluding a hospital representative unless there is specification that one of the five provider categories as listed in section 1512(b) (3) (C) (ii) should be a person who is a hospital representative. As this is a major category for the provision of health service, it is important to preclude this possibility.

c. Legislative Language. The following is proposed legislative language to amend the National Health Planning and Resources Development Act in accord with the above policy:

COMPOSITION OF NATIONAL COUNCIL ON HEALTH
PLANNING AND DEVELOPMENT

SECTION 1503(b)(1)

"(b)(1) The Council shall be composed of not less than fifteen nor more than twenty members, The Chief Medical Director of the Veteran's Administration, the Assistant Secretary for Health and Environment of the Department of Defense, and the Assistant Secretary for Health of the Department of Health, Education, and Welfare shall be nonvoting ex officio members of the Council. The remaining members shall be appointed by the Secretary and shall be persons who, as a result of their training, experience, or attainments, are exceptionally well qualified to assist in carrying out the functions of the Council. Of the voting members, not less than one shall represent each of the five classifications of providers enumerated in section 1512(b)(3)(C)(ii), not less than five shall be persons who are not providers of health services, not more than three shall be officers or employees of the Federal Government, not less than three shall be members of governing bodies of health systems agencies designated under part B, and not less than three shall be members of Statewide Health Coordinating Councils under section 1524 and not less than one shall be representative of hospital administration. The two major political parties shall have equal representation among the voting members on the Council."