§ 23-17.14-28. Concurrent approval — License.
(a) The director may consider the requirement of this chapter and the requirements of
§§ 23-17-1 — 23-17-45 together upon completion of the initial application. The director may approve, approve
with conditions, or disapprove one or both requests filed pursuant to this chapter,
including expedited review under § 23-17.14-12.1, and §§ 23-17-1 — 23-17-45. The approvals of the director required by this chapter shall be subject to chapter 35 of title 42. For any conversion subject to this chapter, the director may combine any hearings
required by this chapter with any hearings on similar or related matters required
by §§ 23-17-1 — 23-17-45 and shall consider issues of market share especially as they affect quality, access,
and affordability of services.
(b) Any approval of a conversion involving a for-profit corporation as an acquiror shall
be subject to any conditions as determined by the director of health, provided those
conditions relate to the purpose of this chapter. The conditions may include, but
not be limited to, the conditions contained in this subsection. In the event the director
determines that one or more of the conditions contained in this subsection are not
appropriate or desirable in a particular conversion, the director shall include the
rationale for not including the condition(s) in any approval.
(1) Maintain a governing body for each converted hospital whose membership shall include
uncompensated, independent individuals who reside in Rhode Island;
(2) Make a financially reasonable contribution to support the state's coordinated health
planning process;
(3) Adhere to reasonable restrictions on financial incentives to patient or health plan
enrollees to receive hospital services outside of the state of Rhode Island;
(4) Keep the new hospital open and operational for a reasonable minimum period of time;
(5) Make a reasonable minimum investment to support primary care in the Rhode Island communities
served by the new hospital;
(6) Not enter into any contract or other service or purchasing arrangements with an affiliated
legal entity except for contracts or arrangements to provide services or products
that are reasonably necessary to accomplish the healthcare purposes of the relevant
hospital and for compensation that is consistent with fair-market value for the services
actually rendered, or the products actually provided;
(7) Report to the director on annual distributions of profit to owners; and
(8) Require that any corporate allocation, or equivalent charge, to any affiliated organization(s)
in any hospital fiscal year not exceed reasonable fair-market value for the services
rendered or the assets purchased or leased from the affiliate.
(c) Any approval of a conversion involving a for-profit corporation as an acquiror shall
be subject to any conditions as determined by the attorney general, provided those
conditions relate to the purpose of this chapter. The conditions may include, but
not be limited to, the acquiror's adherence to a minimum investment to protect the
assets, financial health, and well-being of the new hospital and for community benefit.
In the event the attorney general determines that the conditions contained in this
subsection are not appropriate or desirable in a particular conversion, the attorney
general shall include the rationale for not including the condition(s) in any approval.
(d) For a period of five (5) years following the effective date of the conversion, when
approval of a conversion involves either a not-for-profit or a for-profit corporation
as an acquiror:
(1) The acquiror shall file reports with the department and the attorney general on or
before March 1 of each calendar year detailing compliance with the conditions in subsection
(b) and any other conditions on the conversion approval or license of the new hospital.
Failure to comply with any of the conditions or the charity care requirements contained
in § 23-17.14-15 shall be cause for penalties to be applied in accordance with § 23-17.14-30;
(2) The department of health and the department of attorney general shall monitor, assess,
and evaluate the acquiror's compliance with all of the conditions of approval, as
well as annually review the impact of the conversion on healthcare costs and services
within the communities served;
(3) The acquiror shall pay for the costs of the department of health and the department
of attorney general in performing the monitoring, evaluation, and assessment in an
amount to be determined by the attorney general or the director as they deem appropriate,
which should be placed in escrow during the term of the monitoring period. No application
for a conversion made pursuant to the requirements of this chapter shall be approved
unless an agreement has been executed with the attorney general and the director for
the payment of reasonable costs in accordance with this section; and
(4) The department and/or the attorney general may seek immediate relief in the superior
court to enforce any conditions of approval of a conversion, and may impose penalties
for noncompliance pursuant to § 23-17.14-30.