902 KAR 20:014. Effect of previous denial

or revocation on applications for a license to operate a health facility.

 

      RELATES TO: KRS 216.2925, 216B.010,

216B.015, 216B.040, 216B.042, 216B.045, 216B.050, 216B.055, 216B.105, 216B.115,

216B.120, 216B.125

      STATUTORY AUTHORITY: KRS 216B.042(1)

      NECESSITY, FUNCTION, AND CONFORMITY: KRS

216B.042(1) requires the Cabinet for Health Services to regulate the licensure

of health facilities. This administrative regulation establishes a prohibition

on the licensing of health facilities that are owned, all or in part, by

entities that have held a significant financial interest in a health facility

that has had its license to operate revoked or denied within the previous five

(5) years.

 

      Section 1. Definitions. (1) "Applicant"

is defined by KRS 216B.015.

      (2) "Cabinet" is defined by KRS

216B.015.

      (3) "Good standing" means a

health care facility that is in substantial compliance with applicable

administrative regulations and which is otherwise eligible for relicensure.

      (4) "Significant financial

interest" means lawful ownership of a health care facility, whether by

share, contribution, or otherwise, in an amount equal to or greater than

twenty-five (25) percent of total ownership of the health care facility.

 

      Section 2. Requirement to Disclose

Ownership of a Health Facility. (1) Each applicant for a license or relicensure

shall disclose the name, address, and telephone number of each individual,

shareholder, or legal entity, including but not limited to, corporation, limited

liability company, limited partnership, or partnership having a significant

financial interest in the health care facility.

      (2) The licensee of a Kentucky health

care facility shall immediately inform the Cabinet for Health Services, in

writing, of the name, address, and telephone number of any individual,

shareholder, or legal entity, including but not limited to corporation, limited

liability company, limited partnership, or partnership that acquires a significant

financial interest in the health care facility.

 

      Section 3. Effect of Previous License

Revocation or Denial on the Issuance of a License to Operate a Health Facility.

(1) The Cabinet for Health Services shall not issue a new health facility license

to any individual, partnership, corporation, or legal entity, however named,

that holds or previously held a significant financial interest in a Kentucky

licensed health care facility that had its license denied or revoked within the

five (5) year period preceding the filing of the application. This section

shall not prohibit annual relicensure of any other existing facility owned or

operated by the individual, partnership, corporation, or legal entity that was

in operation and in good standing on the date of the final administrative order

denying or revoking the license.

      (2) An individual, shareholder, or legal

entity shall not acquire a significant financial interest in any licensed

health care facility if that individual, shareholder, or legal entity

previously held a significant financial interest in a Kentucky licensed health

care facility that had its license denied or revoked within the preceding five

(5) year period.

      (3) Failure of the facility or any

individual or legal entity operating the facility to comply with any provision

in this section or Sections 1 or 2 of this administrative regulation may result

in denial or revocation of existing Kentucky health facility licenses owned or

operated by the individual or legal entity.

 

      Section 4. Hearings. A health care facility or applicant dissatisfied

with a decision to deny or revoke a license under Section 3 of this

administrative regulation may file a written request for a hearing with the

Secretary of the Cabinet for Health Services. The request shall be received by

the secretary of the cabinet within twenty (20) days of the date the health

care facility or applicant receives notice of the decision to deny or revoke

the license. Hearings under this section shall be conducted in accordance with

KRS 216B.040 and 900 KAR 6:040. (30 Ky.R. 180; Am. 612; eff. 8-20-2003.)