H 3583 Session 111 (1995-1996)
H 3583 General Bill, By Fair, Anderson, Cato, Easterday, Haskins,
R.J. Herdklotz, M.F. Jaskwhich, McMahand, Rice, Tripp and Vaughn
Similar(S 454)
A Bill to amend Title 44, Chapter 7, Code of Laws of South Carolina, 1976,
relating to hospitals, by adding Article 10 so as to enact the Hospital Fair
Pricing Act, to define terms, to allow acute care hospitals to purchase
services from sole provider hospitals at a certain rate, and to provide a
cause of action and injunctive relief for violations; to amend Section
44-7-180, as amended, relating to the State Health Plan for use in the
administration of the certificate of need program, so as to provide that the
Plan must contain a policy statement requiring access to health care services
by a provider so that the provider may offer these services on a competitive
basis, where competition is permitted; and to require in the plan standards to
enforce this policy and standards for preventing exercise of or damages from a
market power resulting from the existence of the certificate of need program.
02/14/95 House Introduced and read first time HJ-14
02/14/95 House Referred to Committee on Medical, Military,
Public and Municipal Affairs HJ-15
A BILL
TO AMEND TITLE 44, CHAPTER 7, CODE OF LAWS OF
SOUTH CAROLINA, 1976, RELATING TO HOSPITALS, BY
ADDING ARTICLE 10 SO AS TO ENACT THE HOSPITAL
FAIR PRICING ACT, TO DEFINE TERMS, TO ALLOW ACUTE
CARE HOSPITALS TO PURCHASE SERVICES FROM SOLE
PROVIDER HOSPITALS AT A CERTAIN RATE, AND TO
PROVIDE A CAUSE OF ACTION AND INJUNCTIVE RELIEF
FOR VIOLATIONS; TO AMEND SECTION 44-7-180, AS
AMENDED, RELATING TO THE STATE HEALTH PLAN FOR
USE IN THE ADMINISTRATION OF THE CERTIFICATE OF
NEED PROGRAM, SO AS TO PROVIDE THAT THE PLAN
MUST CONTAIN A POLICY STATEMENT REQUIRING
ACCESS TO HEALTH CARE SERVICES BY A PROVIDER SO
THAT THE PROVIDER MAY OFFER THESE SERVICES ON A
COMPETITIVE BASIS, WHERE COMPETITION IS
PERMITTED; AND TO REQUIRE IN THE PLAN STANDARDS
TO ENFORCE THIS POLICY AND STANDARDS FOR
PREVENTING EXERCISE OF OR DAMAGES FROM A
MARKET POWER RESULTING FROM THE EXISTENCE OF
THE CERTIFICATE OF NEED PROGRAM.
Be it enacted by the General Assembly of the State of South
Carolina:
SECTION 1. Title 44, Chapter 7 of the 1976 Code is amended
by adding:
"Article 10
Hospital Fair Pricing
Section 44-7-1350. This article may be cited as the South
Carolina Hospital Fair Pricing Act.
Section 44-7-1360. As used in this article:
(1) `Affiliate' with respect to a facility means a person or entity
that directly or indirectly controls, is controlled by, or is under
common control with the facility, whether through ownership of
voting securities, by contract, or otherwise.
(2) `Facility' means an entity or person that owns or controls,
whether through the ownership of voting securities, by contract, or
otherwise, directly or indirectly one or more acute care hospitals.
(3) `Sole provider facility' means a facility which provides one
or more health care services within a county that are not provided
in that county by any other person or entity other than an affiliate
of the facility.
(4) `Sole provider service' means a health care service that is
offered from one or more locations within a county only by a single
facility or one or more of its affiliates or by the facility and one or
more of its affiliates when there is also at least one acute care
hospital located in the county that is not controlled directly or
indirectly by that facility or any of its affiliates.
(5) `Health care service' means a service that is offered by an
acute care hospital including, but not limited to, a service that is
identified separately under a generally applicable coding, listing, or
other classification or identification of medical services.
(6) `Offered price' with respect to a sole provider service in a
particular county is a price offered by the sole provider facility or
any of its affiliates in connection with the provision of that sole
provider service under any type of reimbursement arrangement,
other than the federal Medicare or Medicaid programs, which would
allow a resident of that county to obtain that sole provider service
in that county.
Section 44-7-1370. (A) A sole provider facility that offers a sole
provider service within a county and any of a facility's affiliates
that offer a sole provider service within that county must allow any
other facility with an acute care hospital located within that county
to purchase a sole provider service offered by the sole provider
facility within that county at whatever offered prices with respect to
providing that sole provider service in that county the other facility
selects from time to time. An offered price must be made available
without requiring that a particular volume of services be purchased
and, with respect to a sole provider service, for as long as the
respective offered price would have been available with respect to
that sole provider service under the terms of any offer.
(B) A sole provider facility, upon receipt of a written request
from another facility within a county where the sole provider
facility offers a sole provider service, shall provide in writing a
complete, detailed statement of all offered prices, in any form,
currently offered or offered in the future by the sole provider
facility or any of its affiliates with respect to each sole provider
service offered by the sole provider facility or any of its affiliates
within that county. The information requested must be delivered by
hand or by facsimile transmission to the person specified from time
to time by the facility making the request for information and:
(1) with respect to prices already offered at the time the
request for pricing information is received, must be delivered to the
requesting facility within ten days of the request; and
(2) with respect to prices offered after the request is made
and which have not already been provided to the requesting facility,
must be delivered simultaneously with the making of an offer of
that pricing.
Section 44-7-1380. (A) If a sole provider facility or any of its
affiliates violates or threatens to violate the provisions of Section
44-7-1370, a facility that, as a result of the actual or threatened
violation, has failed or would fail to receive the benefits of Section
44-7-1370 may bring an action to recover damages or to obtain
injunctive relief or both. Whenever injunctive relief or a verdict for
damages or both is obtained in an action, the trial judge shall award
the facility which is entitled to the damages or injunctive relief or
both three times the actual damages plus the reasonable attorney's
fees and costs incurred by that facility in connection with bringing
the claim for damages or injunctive relief or both.
(B) An action under this section may be brought in the court of
common pleas in the county in which the complaining facility
maintains an acute care hospital, has its principal place of business,
or conducts business.
(C) The courts are authorized to issue orders and injunctions to
restrain and prevent violations of this article, and these orders and
injunctions must be issued without bond."
SECTION 2. Section 44-7-180(B) of the 1976 Code, as last
amended by Act 511 of 1992, is further amended by adding at the
end:
"(5) a general statement that it is against the policy of the
State for a provider who obtains market power in a geographic area
in a service as a result of the certificate of need laws and
regulations to deny a provider in that geographic area, who lacks
that service, access to that service on a basis that will enable full
and fair competition in services as to which competition is
permitted in that area under the state plan; and
(6) standards and requirements for the enforcement of the policy
set forth in item (5) including, but not limited to, restrictions and
requirements to prevent price discrimination in violation of that
policy."
SECTION 3. Section 44-7-180(B)(3) of the 1976 Code, as last
amended by Act 511 of 1992, is further amended to read:
"(3) standards for distribution of health care facilities,
beds, specified health services, and equipment including scope of
services to be provided, utilization, and occupancy rates, travel
time, regionalization, prevention of the exercise of or injury
from any market power that may result from the existence of the
certificate of need program, other factors relating to proper
placement of services, and proper planning of health care
facilities; and".
SECTION 4. This act takes effect upon approval by the
Governor.
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