HB 5045, An Act Streamlining Health Care Facility Approvals

TESTIMONY OF THE CONNECTICUT HOSPITAL ASSOCIATION
SUBMITTED TO THE PUBLIC HEALTH COMMITTEE

Wednesday, March 4, 2026

The Connecticut Hospital Association (CHA) appreciates this opportunity to submit testimony on HB 5045, An Act Streamlining Health Care Facility Approvals.  CHA opposes the bill as drafted but is interested in working with the committee and administration to craft a new certificate of need (CON) process.  We offer the following recommendations to improve the bill and the CON process.

Connecticut hospitals make our state stronger by delivering nationally recognized, world-class care, supporting jobs and economic growth, and serving communities across Connecticut.  Every day, hospitals improve access, affordability, and health equity — providing care to all patients regardless of ability to pay.  At the same time, hospitals invest in their workforce and local communities, even as they navigate significant financial and federal challenges.

CHA continues to advocate for a CON process that is timely, equitable, efficient, and not cost-prohibitive for applicants and stakeholders.  We appreciate that the administration recognizes the need to overhaul the CON process and look forward to working with the committee and the administration to refine the legislation to meet our shared goal of creating a process that supports patient care.

HB 5045 proposes a fundamental restructuring of Connecticut’s CON process.  The most significant changes include:

  • Transfer of Decision-Making Authority: Moving CON decision-making from the Office of Health Strategy (OHS) to a new three-member panel housed within the Department of Public Health (DPH), with members from DPH, the Office of Policy and Management (OPM), and the Department of Social Services (DSS)
  • Streamlined Scope of CON Requirements: Eliminating several CON triggers (including for termination of services) while expanding the scope of others (most significantly, for change of ownership/control)
  • New Process Architecture: Implementing quarterly application deadlines, mandatory public hearings (with a waiver option), and expedited review pathways
  • Enhancing Ability to Impose Conditions Unilaterally: Allowing the new panel to impose conditions without those conditions being subject to negotiation
  • Modified Hospital Transfer Oversight: Expanding cost and market impact review requirements with explicit attorney general enforcement authority

Our comments are outlined below by category.

Definitions

  • New “Change of Ownership or Control” Definition: The bill introduces a significantly broader definition than the current “transfer of ownership” definition, explicitly capturing private equity transactions, hedge funds, management services organizations, real estate investment trusts, and transactions involving 20% or more of assets.  It also captures a range of arrangements, including leases or a contract that conveys “control.”  We believe this change in definition should be further discussed to ensure that it is not capturing transactions outside of the intended purposes. 
  • Modified “Group Practice” Definition: The bill replaces the “large group practice” definition (eight or more full-time equivalent physicians) with a cross-reference to the broader “group practice” definition under Section 19a-486i (“two or more physicians”), triggering CON review for any group practice transaction involving $10 million or more in assets/revenue or private equity involvement.  This new definition will likely result in a significant increase in the number of transactions subject to CON review and capture some unintended transactions.  We are concerned that this will slow down CON approvals generally and subject almost all transactions to a CON process.

Decision Making Authority

  • Unilateral Condition Imposition: We are concerned that the new process would allow the imposition of conditions without those conditions being subject to negotiation.
  • Guidelines and Principles: The bill should include language requiring that CON decisions be “consistent at all times with the guidelines and principles set by the General Assembly in Section 19a-638(a)” and prohibiting applicants from being mandated to meet requirements or obligations that are not set forth in statute or regulation in order to obtain a CON.
  • Staffing and Transparency: The bill should also include provisions for mandatory minimum staffing at DPH to ensure the timely processing of CON applications and a provision for transparency related to the costs of consultants utilized in the review and processing of CON applications.

Activities Requiring Certificate of Need

  • Scope: The bill eliminates CON review for service terminations (though a new process is provided for terminations).  However, the bill increases CON oversight for changes of ownership/control of (1) all healthcare facilities and (2) group practices with >$10M in assets/revenue.  We appreciate the flexibility related to termination of services, but we are concerned about this increase in the scope of the expansion of review.  We believe the intent of the provision is to capture certain transactions related to private equity and would recommend more limited language to meet that purpose.

Activities Exempt from CON

  • Service Relocation: We appreciate that the bill includes an exemption in new subsection (26), to exempt from CON service relocations.

We believe the following should also be included as activities exempt from CON:

  • Small bed capacity changes: Reduction or increase in the number of inpatient or outpatient hospital beds by nine or fewer beds in a two-year cycle
  • Temporary surge capacity: A temporary increase in licensed bed capacity of a hospital due to a surge in admissions that cannot be accommodated by the hospital’s existing licensed bed capacity

CON Application Guidelines

  • Conditions on Approval: The bill should include language that justifies the duration of any condition imposed by weighing the burden of the condition against the benefit.  Additionally, no condition should exceed three years in duration.

CON Application Process

  • Hearing Requirement: Not every CON application should be subject to a hearing; this change in process will significantly slow down CON approvals and subject the most administerial CON requests to an overly administrative process that is not required.  We view this as a step backward in the collective work to improve CON.
  • Three-member Panel: We are concerned that the infrequency with which the panel will meet will mean CON applications are delayed and not determined timely.  We also believe the legislation requires clarity related to the role of the panel.  Will the panel preside over hearings, or will they convene to make determinations?  If they are not presiding over hearings, who will be conducting the required hearings? Will the panel be able to meet in between their scheduled quarterly meetings if needed?

The following concepts should also be incorporated into the legislation

  • Reducing delays by limiting requests for information
  • Using only information in the record and available to all parties in making decisions
  • Requiring timeliness in noticing and holding hearings
  • Deeming applications approved should statutory timeframes not be met

Service Terminations

  • Review Process: We appreciate the additional flexibility the legislation provides related to service terminations.  In order to ensure the new process works fairly for providers, we believe language should be included that provides an appeal or other process if a provider seeking to terminate a service cannot find agreement with DPH related to the service termination plan contemplated in the bill

Thank you for your consideration of our position.  For additional information, contact CHA Government Relations at (203) 294-7301.