Opinion ID: 2177703
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Heading: The Background of the Certificate of Need Act.

Text: The Certificate of Need Act was enacted in 1980 in order to enable the District to qualify for federal financial assistance pursuant to Title 15 of the Public Health Service Act (PHSA), 42 U.S.C. §§ 300k-1 to 300n-6 (1982) (repealed 1986). The PHSA was itself enacted as part of the National Health Planning and Resources Development Act of 1974, Pub.L. No. 93-641, 88 Stat. 2225 (1975) (NHPRDA). The purposes of the NHPRDA were to facilitate the development of recommendations for a national health planning policy, to augment areawide and State planning for health services, manpower, and facilities, and to authorize financial assistance for the development of resources to further that policy. 42 U.S.C. § 300k(b) (1982). The NHPRDA authorized federal financial assistance to the states and to the District of Columbia in order to promote health planning and development. Id. §§ 300m-3, 300m-4. In order to become eligible to receive such federal financial assistance, a jurisdiction was required to establish a [s]tate health planning and development agency and an administrative program, both of which required approval by the Secretary of Health and Human Services. Id. §§ 300m, 300m-1, 300m-4. Among the functions of the agency would be to administer a State certificate of need program which applies to the obligation of capital expenditures within the State and the offering within the State of new institutional health services and the acquisition of major medical equipment and which is consistent with standards established by the Secretary by regulation. Id. § 300m-2(a)(4)(B). By requiring states to impose a need requirement before an applicant could offer a new institutional health service, Congress hoped to reduce maldistribution of health care facilities, a phenomenon which had led to the oversupply of medical services in some areas and a dearth of services in others. North Carolina ex rel. Morrow v. Califano, 445 F.Supp. 532, 534 (E.D.N.C.1977) (quoting 42 U.S.C. § 300k(a)(3)(B) (1982)), aff'd mem., 435 U.S. 962, 98 S.Ct. 1597, 56 L.Ed.2d 54 (1978); see also S. REP. No. 1285, 93d Cong., 2d Sess. 39, reprinted in 4 U.S. CODE CONG. & ADMIN. NEWS 7842, 7878-79 (1974). In 1986, Congress repealed Title 15, including the federal mandate for state certificate of need programs. See Act of November 14, 1986, Pub.L. No. 99-660, § 701, 100 Stat. 3743, 3799. Nevertheless, the District's program, originally enacted in 1980, continues to operate. It requires that [a]ll persons proposing to offer or develop a new institutional health service or to obligate a capital expenditure in the District shall, prior to proceeding with that offering, development or obligation, obtain from the SHPDA a certificate of need indicating that there exists a public need for such new service or expenditure. D.C.Code § 32-303(a)(1) (1988). In addition, [e]xpenditures in excess of $150,000 in preparation to develop or offer a new institutional health service for which a certificate of need is required or arrangements or commitments for financing an offer or development of a new institutional health service for which a certificate of need is required shall not be made by any person unless a certificate of need has been granted. Id. § 32-303(e). The Certificate of Need Act specifically includes the District government within the definition of the term person. Id. § 32-302(13). It requires the SHPDA, which the Mayor created in 1976, see Mayor's Order 76-59, 22 D.C. Reg. 4302 (1976), to review all applications for certificates of need. D.C.Code § 32-304(a) (1988). The statute and the regulations promulgated pursuant to the CONA set forth numerous criteria which an applicant must meet in order to secure a certificate. See id. § 32-305 (1988 & 1989 Supp.); 22 DCMR § 4050 (1986). The CONA further requires the agency to adopt and revise regulations, in accordance with the DCAPA, to govern application review procedures. D.C.Code § 32-304 (1988). Currently, these regulations require the SHPDA to give [t]imely written notification of the beginning of the review, either by publication or mail, to the general public, to all affected persons, and to any person who has asked to be placed on the SHPDA mailing list. 22 DCMR §§ 4201.1, 4201.3 (1986). Affected persons include the applicant, other health care facilities, certain health care agencies and their insurers, and members of the public who reside in or regularly use health services in the geographic area to be served by the applicant. Id. § 4201.2. Upon timely written request, the agency must afford any affected person an opportunity for a public hearing on the application. Id. § 4302.2. At the hearing any person shall have the right to be represented by counsel and to present oral or written argument and evidence relevant to the matter that is the subject of the hearing. Id. § 4302.3. In addition, [a]ny person affected by the matter that is the subject of the hearing may conduct reasonable questioning [of witnesses]. Id. § 4302.4. Upon a request from any person for reconsideration of a decision affecting an application, the SHPDA must, if good cause is shown, hold a public hearing. D.C.Code § 32-308 (1988). Any previously appearing person has the right to appeal the final decision to the Board of Appeals and Review. Id. § 32-309. Finally, any person adversely affected by the ruling of the Board may appeal to this court. Id. § 32-310.