NY DOH Revises Policy for ASC Approval

The New York State Department of Health (DOH) recently revised its policy regarding the review and approval process for Certificate of Need (CON) applications for ambulatory surgery centers (ASCs).

The DOH’s current public need criteria favor the approval of new ASCs because they allow patients to obtain safe, low-cost and convenient surgical services outside a hospital setting. However, in assessing public need, the DOH recognized that its policies did not provide it with flexibility to differentiate factors present in different geographic areas of the state. As a result, the DOH will now consider a broader application of the public need criteria to ensure continued access to essential community healthcare services.

Specifically, the DOH has revised its public need policy as follows:

• If a proposed ASC will have a negative financial impact on existing community hospitals, the DOH will recommend disapproval of the CON;
• In the CON approval process, the DOH will also consider whether the proposed ASC will make good-faith efforts to collaborate with a community hospital to improve the public’s access to specialty services while reducing overall healthcare costs; and
• The DOH will impose a limited life of five years on non-hospital owned ASCs, not only upon initial establishment of the ASC but also upon any change of ownership of 50% or more of the ASC. After five years, the ASC will need to request an extension of its operating certificate and undergo a full DOH review.