Oregon Administrative Rules › Chapter 410 - OREGON HEALTH AUTHORITY, HEALTH SYSTEMS DIVISION: MEDICAL ASSISTANCE PROGRAMS › Division 145 - COOPERATIVE TRANSPLANT PROGRAM APPROVAL AND MONITORING › Section 410-145-0010 - Application Procedures

Current through Register Vol. 63, No. 7, July 1, 2024
(1) The
			 Oregon Health Sciences University and one or more entities, each of which
			 operates at least three hospitals in a single urban area in this state, may
			 apply to the director for approval of a cooperative program.
(2) The application must include all of the
			 following information, in the order specified:
(a) The names and addresses of each of the
			 entities to be involved in the cooperative program, with a narrative describing
			 how each entity meets the eligibility requirements set out in section (1) of
			 this rule;
(b) A list of the names
			 of all health care providers who propose to provide heart and kidney transplant
			 services under the cooperative program, together with appropriate evidence of
			 compliance with any licensing or certification requirements for those health
			 care providers to practice in this state. The services to be provided by each
			 provider and the location where these services are to be provided should be
			 identified. In the case of employed physicians, the list and the information to
			 be submitted may be limited to the employer or organizational unit of the
			 employer;
(c) A description of the
			 activities to be conducted by the cooperative program;
(d) A description of proposed anticompetitive
			 practices listed in paragraphs (A) through (E) of this subsection, any
			 practices that the parties anticipate will have significant anticompetitive
			 effects and a description of practices of the cooperative program affecting
			 costs, prices, personnel positions, capital expenditures and allocation of
			 resources. As provided in ORS
			 442.715(1),
			 practices which may be authorized by an order issued under this rule include:
(A) Setting prices for heart and kidney
			 transplants and all services directly related to heart and kidney
			 transplants;
(B) Refusing to deal
			 with competitors in the heart and kidney transplant market;
(C) Allocating product, service, geographic
			 and patient markets directly relating to heart and kidney
			 transplants;
(D) Acquiring and
			 maintaining a monopoly in heart and kidney transplant services; and
(E) Engaging in other activities that might
			 give rise to liability under ORS
			 646.705 - ORS
			 646.836 or federal antitrust
			 laws.
(e) A list of the
			 goals identified in paragraphs (A) through (H) of this subsection that the
			 cooperative agreement expects to achieve, together with an explanation,
			 including documentation as necessary, of the way in which such goals will be
			 achieved and the anticipated time schedule for meeting these goals. The phrase
			 "Reduction of, or protection against", as used in paragraphs (A), (B) and (D)
			 of this subsection, means that the applicants have two options for
			 demonstrating accomplishment of these goals. The application may compare the
			 projected results for the cooperative program to the existing situation, in
			 which case a reduction in price, cost and duplication of resources compared to
			 present conditions must be demonstrated. Alternatively, the application may
			 compare the projected results for the cooperative program to the situation that
			 would have existed if there were separate, competing transplant programs. In
			 this latter case, the application must demonstrate that the proposed
			 cooperative program will result in protection against the rising costs, rising
			 prices and duplication of resources that might result if there were competing
			 programs. As provided in ORS
			 442.705(2),
			 goals which might be achieved through cooperative transplant programs include:
(A) Reduction of, or protection against,
			 rising costs of heart and kidney transplant services;
(B) Reduction of, or protection against,
			 rising prices for heart and kidney transplant services;
(C) Improvement or maintenance of the quality
			 of heart and kidney transplant services provided in this state;
(D) Reduction of, or protection against,
			 duplication of resources including, without limitation, expensive medical
			 specialists, medical equipment and sites of service;
(E) Improvement or maintenance of efficiency
			 in the delivery of heart and kidney transplant services;
(F) Improvement or maintenance of public
			 access to heart and kidney transplant services;
(G) Increase in donations of organs for
			 transplantation; and
(H)
			 Improvement in the continuity of patient care.
(f) A description of the proposed places and
			 manner of providing heart and kidney transplant services and services related
			 to heart and kidney transplants under the cooperative program. This description
			 should include a discussion of whether service sites have or will receive
			 membership in the United Network for Organ Sharing (UNOS). If the cooperative
			 program will not initially include both heart and kidney transplant services,
			 the application shall identify which services will not initially be included,
			 and will describe what will be done by the parties to work towards inclusion of
			 such services in the future. The application must describe the ongoing efforts
			 being made and any planned efforts for including both heart and kidney
			 transplant services in the cooperative program;
(g) Projections of the number of heart
			 transplants and the number of kidney transplants which the cooperative program
			 expects to perform in each of its first three years of operation. These
			 projections should be accompanied by a discussion of the methodology by which
			 they were derived. A description of the expected service area(s) for the
			 cooperative program's services should also be included;
(h) If the application claims that the
			 program will achieve the goal in paragraph (e)(G) of this section, or if the
			 application projects an increase in the total number of heart or kidney
			 transplants in the state, the application should discuss how donor organ
			 availability would change as a result of the cooperative program's operations,
			 and explain the reasons why such changes are anticipated;
(i) If the applicants intend to demonstrate
			 that the cooperative program will result in a reduction of costs, prices and
			 duplication of resources compared to present conditions, the application must
			 include a budget for the most recently completed fiscal year for each existing
			 heart and kidney transplant program, as well as a proposed budget for operating
			 the cooperative program for its first three years. The budget for the
			 cooperative program must account for all applicable services listed in OAR
			 410-145-0000(2). Both the budgets for existing programs and the projected
			 budget for the proposed cooperative program must include the following
			 information:
(A) Gross revenues;
(B) Direct expenses, including a breakdown
			 into salaries, payroll taxes and fringe benefits, any compensation to
			 physicians to be paid by the program, supplies, bad debts, depreciation and
			 interest, and other direct expenses;
(C) Indirect expenses, identified by
			 categories which should include operation and maintenance of plant,
			 housekeeping, billing, insurance, another indirect expenses;
(D) Deductions from revenue by component,
			 including charity care;
(E) Net
			 operating income (or loss) after the allocation of indirect expenses from
			 non-revenue producing departments;
(F) Anticipated gross and net operating
			 revenue per case for heart transplants and for kidney transplants;
(G) If either existing programs or the
			 proposed cooperative programs charge or anticipate charging any flat fees for
			 any transplant services, the amount of such fees (projected for the first three
			 years of operation, in the case of the cooperative program);
(H) For the cooperative program only, any
			 proposed capital expenditures; and
(I) Projected cost savings or cost increases
			 to the health care system of the proposed cooperative program, compared to the
			 costs of existing transplant services.
(j) If the applicants intend to demonstrate
			 that the cooperative program will result in protection against rising costs,
			 rising prices and duplication of resources compared to the situation that would
			 have existed if there were separate, competing transplant programs, the
			 application must include a proposed budget for operating the cooperative
			 program for its first three years. This budget must account for all applicable
			 services listed in OAR 410-145-0000(2)  which will be delivered at a new
			 transplant program site, and for all new services which will be delivered
			 through the cooperative program at an existing site. The budget must also
			 separately account for any existing services that will be included in or
			 provide support to the cooperative program, but the application may provide a
			 lesser level of detail for the budget information on existing services. The
			 applicant must also provide a projected three year budget for new transplant
			 service sites and associated support services, showing what would occur if the
			 services proposed to be delivered by the cooperative program were to be
			 delivered through separate, competing programs. Both the cooperative program
			 budget and the hypothetical budget for a competing program must include the
			 following information:
(A) Gross
			 revenues;
(B) Direct expenses (for
			 services provided through a new transplant program site or for new services at
			 an existing site, include a breakdown into salaries, payroll taxes and fringe
			 benefits, any compensation to physicians to be paid by the program, supplies,
			 bad debts, depreciation and interest, and other direct expenses);
(C) Indirect expenses (for services provided
			 through a new transplant program site or for new services at an existing site,
			 identified by categories which should include operation and maintenance of
			 plant, housekeeping, billing, insurance, and other indirect
			 expenses);
(D) Deductions from
			 revenue (for services provided through a new transplant program site or for new
			 services at an existing site, deductions should be broken out by component,
			 including charity care);
(E) Net
			 operating income (or loss) after the allocation of indirect expenses from
			 non-revenue producing departments;
(F) Anticipated gross and net operating
			 revenue per case for heart transplants and for kidney transplants;
(G) If it is anticipated that either the
			 cooperative or competitive program would charge any flat fees for any
			 transplant services, a projection of such fees for the first three years of
			 operation;
(H) For services
			 provided through a new transplant site or for new services at an existing site,
			 any proposed capital expenditures; and
(I) Projected cost savings or cost increases
			 to the health care system of cooperative vs. competitive programs for
			 transplant services.
(k)
			 Satisfactory evidence of financial ability to deliver heart and kidney
			 transplant services in accordance with the cooperative program. Such evidence
			 shall include:
(A) Financial statements for
			 each party to the application for each of the three previous years;
(B) The anticipated sources or reimbursement
			 for heart transplants and sources of reimbursement for kidney transplants
			 during the first three years of cooperative program operations. The application
			 should discuss whether the cooperative program anticipates receiving Medicare
			 certification for any proposed new heart and kidney transplant sites and, if
			 so, when such certification is expected. The application should also discuss
			 any existing or anticipated contractual agreements with third party payers
			 regarding cooperative program services, and any anticipated modifications of
			 existing contractual agreements concerning cooperative program services between
			 parties to the cooperative agreement and third party payers.
(l) The agreement that establishes
			 the cooperative program and policies that shall govern it.