
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 42USC300t-12]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                    CHAPTER 6A--PUBLIC HEALTH SERVICE
 
              SUBCHAPTER XIV--HEALTH RESOURCES DEVELOPMENT
 
  Part E--Program To Assist and Encourage Voluntary Discontinuance of 
Unneeded Hospital Services and Conversion of Unneeded Hospital Services 
              to Other Health Services Needed by Community
 
Sec. 300t-12. Grants for discontinuance and conversion


(a) Terms and conditions; determination of amount; authorized uses

    (1) A grant to a hospital under the program shall be subject to such 
terms and conditions as the Secretary may by regulation prescribe to 
assure that the grant is used for the purpose for which it was made.
    (2) The amount of any such grant shall be determined by the 
Secretary. The recipient of such a grant may use the grant--
        (A) in the case of a grantee which discontinues the provision of 
    all hospital services or all inpatient hospital services or an 
    identifiable part of a hospital facility which provides inpatient 
    hospital services, for the liquidation of the outstanding debt on 
    the facilities of the grantee used for the provision of the services 
    or for the liquidation of the outstanding debt of the grantee on 
    such identifiable part;
        (B) in the case of a grantee which in discontinuing the 
    provision of an inpatient hospital service converts or proposes to 
    convert an identifiable part of a hospital facility used in the 
    provision of the discontinued service to the delivery of other 
    health services, for the planning, development (including 
    construction and acquisition of equipment), and delivery of the 
    health service;
        (C) to provide reasonable termination pay for personnel of the 
    grantee who will lose employment because of the discontinuance of 
    hospital services made by the grantee, retraining of such personnel, 
    assisting such personnel in securing employment, and other costs of 
    implementing arrangements described in subsection (c) of this 
    section; and
        (D) for such other costs which the Secretary determines may need 
    to be incurred by the grantee in discontinuing hospital services.

(b) Application; submission and approval; form; required provisions; 
        review by health systems agency; basis of State Agency's 
        recommendations; urban or rural poverty population 
        considerations; approval by Secretary; restrictions and special 
        considerations

    (1) No grant may be made to a hospital unless an application 
therefor is submitted to and approved by the Secretary. Such an 
application shall be in such form and submitted in such manner as the 
Secretary may prescribe and shall include--
        (A) a description of each service to be discontinued and, if a 
    part of a hospital is to be discontinued or converted to another use 
    in connection with such discontinuance, a description of such part;
        (B) an evaluation of the impact of such discontinuance and 
    conversion on the provision of health care in the health service 
    area in which such service is provided;
        (C) an estimate of the change in the applicant's costs which 
    will result from such discontinuance and conversion; and
        (D) reasonable assurance that all laborers and mechanics 
    employed by contractors or subcontractors in the performance of work 
    on a project will be paid wages at rates not less than those 
    prevailing on similar construction in the locality as determined by 
    the Secretary of Labor in accordance with the Act of March 3, 1931 
    (40 U.S.C. 276a--276a-5, known as the Davis-Bacon Act), and the 
    Secretary of Labor shall have with respect to such labor standards 
    the authority and functions set forth in Reorganization Plan 
    Numbered 14 of 1950 (15 FR 3176; 5 U.S.C. Appendix) and section 276c 
    of title 40;
        (E) such other information as the Secretary may require.

    (2)(A) The health systems agency for the health service area in 
which is located a hospital applying for a grant under the program shall 
(i) in making the review of the applicant's application under section 
300l-2(e) \1\ of this title, determine the need for each service or part 
proposed to be discontinued by the applicant, (ii) in the case of an 
application for the conversion of a facility, determine the need for 
each service which will be provided as a result of the conversion, and 
(iii) make a recommendation to the State Agency for the State in which 
the applicant is located respecting approval by the Secretary of the 
applicant's application.
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    \1\ See References in Text note below.
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    (B) A State Agency which has received a recommendation from a health 
systems agency under subparagraph (A) respecting an application shall, 
after consideration of such recommendation, make a recommendation to the 
Secretary respecting the approval by the Secretary of the application. A 
State Agency's recommendation under this subparagraph respecting the 
approval of an application (i) shall be based upon (I) the need for each 
service or part proposed to be discontinued by the applicant, (II) in 
the case of an application for the conversion of a facility, the need 
for each service which will be provided as a result of the conversion, 
and (III) such other criteria as the Secretary may prescribe, and (ii) 
shall be accompanied by the health systems agency's recommendation made 
with respect to the approval of the application.
    (C) In determining, under subparagraphs (A) and (B), the need for 
the service (or services) or part proposed to be discontinued or 
converted by an applicant for a grant, a health systems agency and State 
Agency shall give special consideration to the unmet needs and existing 
access patterns of urban or rural poverty populations.
    (3)(A) The Secretary may not approve an application of a hospital 
for a grant--
        (i) if a State Agency recommended that the application not be 
    approved, or
        (ii) if the Secretary is unable to determine that the cost of 
    providing inpatient health services in the health service area in 
    which the applicant is located will be less than if the inpatient 
    health services proposed to be discontinued were not discontinued.

    (B) In considering applications of hospitals for grants the 
Secretary shall consider the recommendations of health systems agencies 
and State Agencies and shall give special consideration to applications 
(i) which will assist health systems agencies and State Agencies to meet 
the goals in their health systems plans and State health plans, or (ii) 
which will result in the greatest reduction in hospital costs within a 
health service area.

(c) Certification of protective arrangements for employment benefits and 
        interests; guidelines; satisfactory arrangement determinations

    (1) Except as provided in paragraph (3), the Secretary may not 
approve an application submitted under subsection (b) of this section 
unless the Secretary of Labor has certified that fair and equitable 
arrangements have been made to protect the interests of employees 
affected by the discontinuance of services against a worsening of their 
positions with respect to their employment, including arrangements to 
preserve the rights of employees under collective-bargaining agreements, 
continuation of collective-bargaining rights consistent with the 
provisions of the National Labor Relations Act [29 U.S.C. 151 et seq.], 
reassignment of affected employees to other jobs, retraining programs, 
protecting pension, health benefits, and other fringe benefits of 
affected employees, and arranging adequate severance pay, if necessary.
    (2) The Secretary of Labor shall by regulation prescribe guidelines 
for arrangements for the protection of the interests of employees 
affected by the discontinuance of hospital services. The Secretary of 
Labor shall consult with the Secretary of Health and Human Services in 
the promulgation of such guidelines. Such guidelines shall first be 
promulgated not later than the promulgation of regulations by the 
Secretary for the administration of the grants authorized by section 
300t-11 of this title.
    (3) The Secretary of Labor shall review each application submitted 
under subsection (b) of this section to determine if the arrangements 
described in paragraph (1) have been made and if they are satisfactory 
and shall notify the Secretary respecting his determination. Such review 
shall be completed within--
        (A) ninety days from the date of the receipt of the application 
    from the Secretary of Health and Human Services, or
        (B) one hundred and twenty days from such date if the Secretary 
    of Labor has by regulation prescribed the circumstances under which 
    the review will require at least one hundred and twenty days.

If within the applicable period, the Secretary of Labor does not notify 
the Secretary of Health and Human Services respecting his determination, 
the Secretary of Health and Human Services shall review the application 
to determine if the applicant has made the arrangements described in 
paragraph (1) and if such arrangements are satisfactory. The Secretary 
may not approve the application unless he determines that such 
arrangements have been made and that they are satisfactory.

(d) Records and audits requirements

    The records and audits requirements of section 292e \2\ of this 
title shall apply with respect to grants made under subsection (a) of 
this section.
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    \2\ See References in Text note below.
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(e) ``Hospital'' defined

    For purposes of this part, the term ``hospital'' means, with respect 
to any fiscal year, an institution (including a distinct part of an 
institution participating in the programs established under title XVIII 
of the Social Security Act [42 U.S.C. 1395 et seq.])--
        (1) which satisfies paragraphs (1) and (7) of section 1861(e) of 
    such Act [42 U.S.C. 1395x(e)],
        (2) imposes charges or accepts payments for services provided to 
    patients, and
        (3) the average duration of a patient's stay in which was thirty 
    days or less in the preceding fiscal year,

but such term does not include a Federal hospital or a psychiatric 
hospital (as described in section 1861(f)(1) of the Social Security Act 
[42 U.S.C. 1395x(f)(1)]).

(July 1, 1944, ch. 373, title XVI, Sec. 1642, as added Pub. L. 96-79, 
title III, Sec. 301(a), Oct. 4, 1979, 93 Stat. 637; amended Pub. L. 96-
88, title V, Sec. 509(b), Oct. 17, 1979, 93 Stat. 695.)

                       References In Text

    Act of March 3, 1931 (40 U.S.C. 276a--276a-5, known as the Davis-
Bacon Act), referred to in subsec. (b)(1)(D), is act Mar. 3, 1931, ch. 
411, 46 Stat. 1494, as amended, which is classified generally to 
sections 276a to 276a-5 of Title 40, Public Buildings, Property, and 
Works. For complete classification of this Act to the Code, see Short 
Title note set out under section 276a of Title 40 and Tables.
    Section 300l-2, of this title, referred to in subsec. (b)(2)(A), was 
repealed effective Jan. 1, 1987, by Pub. L. 99-660, title VII, 
Sec. 701(a), Nov. 14, 1986, 100 Stat. 3799.
    The National Labor Relations Act, referred to in subsec. (c)(1), is 
act July 5, 1935, ch. 372, 49 Stat. 452, as amended, which is classified 
generally to subchapter II (Sec. 151 et seq.) of chapter 7 of Title 29, 
Labor. For complete classification of this Act to the Code, see section 
167 of Title 29 and Tables.
    Section 292e of this title, referred to in subsec. (d), was in the 
original a reference to section 705 of act July 1, 1944. Section 705 of 
that Act was omitted in the general revision of subchapter V of this 
chapter by Pub. L. 102-408, title I, Sec. 102, Oct. 13, 1992, 106 Stat. 
1994. Pub. L. 102-408 enacted a new section 705 of act July 1, 1944, 
relating to eligibility of borrowers and terms of insured loans, and a 
new section 706, relating to certificates of loan insurance, which are 
classified to sections 292d and 292e, respectively, of this title.
    The Social Security Act, referred to in subsec. (e), is act Aug. 14, 
1935, ch. 531, 49 Stat. 620, as amended. Title XVIII of the Social 
Security Act is classified generally to subchapter XVIII (Sec. 1395 et 
seq.) of chapter 7 of this title. For complete classification of this 
Act to the Code, see section 1305 of this title and Tables.

                         Change of Name

    ``Secretary of Health and Human Services'' substituted for 
``Secretary of Health, Education, and Welfare'' in subsec. (c)(2) and 
(3), pursuant to section 509(b) of Pub. L. 96-88 which is classified to 
section 3508(b) of Title 20, Education.

                  Section Referred to in Other Sections

    This section is referred to in sections 300s-1a, 300s-3, 300s-5, 
300t-14 of this title.
