Illinois Health Facilities Planning Board Plans New Assessment Tool for Determining Whether a Certificate of Need Permit is Required

October 24, 2008

The Illinois Health Facilities Planning Board (the “HFPB”) is making plans to heighten its scrutiny of health care providers’ capital expenditures. The HFPB recently circulated a draft form entitled the Certificate of Need or Exemption Assessment of Applicability. Health care providers may use this assessment tool for any proposed or anticipated construction or modification projects, including any acquisition of major medical equipment, to better understand and abide by the CON permit requirements. The assessment tool is not currently planned to be mandatory.

Under the current law, Illinois health care providers must obtain HFPB approval for a variety of development and expansion projects including the establishment of new facilities and services and large modernization projects when capital expenditures exceed CON review threshold dollar amounts. The HFPB currently has no consistent process for assessing projects that are not brought before it. For example, when a provider determines that its project falls below the threshold, it can ask for an advisory opinion or a declaratory letter from the HFPB, or send its own courtesy letter to the HFPB, confirming that a CON permit or an exemption to permit is unnecessary. With the new assessment tool, the HFPB plans to implement a process through which health care providers may obtain a HFPB written confirmation that they need not apply for a CON permit or an exemption to permit.

By using the Assessment of Applicability, health care providers would disclose planned capital expenditures and certify that their projects are not within the jurisdiction of the HFPB. Once the Assessment indicates that no permit or exemption is required, a health care provider may submit the Assessment to the HFPB for a written confirmation. The Assessment is proposed to consist of two parts — a Requirement Checklist and a Certification. The Requirement Checklist breaks down the CON requirements into simple yes-or-no questions so that once a provider answers the questions, it can readily ascertain whether a CON permit or exemption is required. The Certification section requests provider contact information and project identification, including its name, location, and a description such as the type of service to be provided and the scope of work. The HFPB also created a worksheet of Estimated Project Costs, which must be submitted along with the Certification.

According to informal advice of a HFPB staff member, the HFPB highly recommends that health care providers use and submit the Assessment if they are unclear about their need for a CON permit or expect the estimated costs to be close to the threshold. It should be noted that the HFPB may be implementing this voluntary process because it had some concerns about certain providers failing to fully comply with the Illinois Health Facilities Planning Act’s CON requirements. The CON law is relatively clear, and providers already have an obligation to report their capital expenditures on their annual hospital questionnaires. Thus, the Assessment, while not planned to be mandatory, will likely become an additional tool for the HFPB to determine whether a provider is in compliance with its rules. HFPB staff has indicated that it expects the final version of the Assessment to be completed in November.

If you have questions about the Certificate of Need or Exemption Assessment of Applicability, please contact the authors.