South Carolina General Assembly
111th Session, 1995-1996

Bill 3915


                    Current Status

Bill Number:                    3915
Ratification Number:            477
Act Number:                     390
Type of Legislation:            General Bill GB
Introducing Body:               House
Introduced Date:                19950404
Primary Sponsor:                Education and Public Works
                                Committee HEPW 21
All Sponsors:                   Education and Public Works
                                Committee
Drafted Document Number:        GJK\21641SD.95
Companion Bill Number:          3607
Date Bill Passed both Bodies:   19960523
Date of Last Amendment:         19960523
Governor's Action:              S
Date of Governor's Action:      19960605
Subject:                        Higher Education Commission

History



Body    Date      Action Description                       Com     Leg Involved
______  ________  _______________________________________  _______ ____________

------  19960613  Act No. A390
------  19960605  Signed by Governor
------  19960530  Ratified R477
Senate  19960523  Ordered enrolled for ratification
Senate  19960523  Conference Committee Report adopted      88 SCC
House   19960523  Conference Committee Report adopted      98 HCC
Senate  19960523  Conference powers granted,               88 SCC  J.Verne Smith
                  appointed Senators to Committee                  Moore
                  of Conference                                    Ford
House   19960523  Conference powers granted,               98 HCC  Felder
                  appointed Reps. to Committee of                  Fulmer
                  Conference                                       Seithel
House   19960523  Insists upon amendment
Senate  19960523  Non-concurrence in House amendment
House   19960523  Senate amendments amended,
                  returned to Senate with amendment
House   19960522  Debate interrupted by adjournment
House   19960521  Debate interrupted by adjournment
House   19960516  Debate adjourned on Senate
                  amendments until Tuesday,
                  19960521
House   19960515  Debate adjourned on Senate
                  amendments until Thursday,
                  19960516
House   19960514  Debate adjourned on Senate 
                  amendment until Wednesday, 
                  19960515
Senate  19960507  Amended, read third time, 
                  returned to House with amendment
Senate  19960502  Debate interrupted
Senate  19960502  Read second time with notice of
                  general amendments, carrying over
                  all amendments to third reading
Senate  19960502  Committee report: Favorable with         13 SMA
                  amendment
Senate  19960410  Committed to Committee,                  13 SMA
                  retaining it's place on the Calendar
Senate  19960410  Recalled from Committee                  04 SED
Senate  19950501  Introduced, read first time,             04 SED
                  referred to Committee
House   19950427  Read third time, sent to Senate
House   19950426  Read second time
House   19950426  Objection withdrawn by Representative            Keyserling
House   19950426  Objection withdrawn by Representative            Neal
House   19950426  Objection withdrawn by Representative            Moody-
                                                                   Lawrence
                                                                   Scott
                                                                   Cave
                                                                   Askins
                                                                   Lloyd                    
House   19950418  Objection by Representative                      McTeer
                                                                   Canty
                                                                   Scott
                                                                   Neal
                                                                   Moody-                   Lawrence
                                                                   Rogers
                                                                   Askins
                                                                   Keyserling
                                                                   Lloyd
                                                                   Cave
House   19950411  Debate adjourned until
                  Tuesday, 19950418
House   19950406  Debate adjourned until
                  Tuesday, 19950411
House   19950404  Introduced, read first time,
                  placed on Calendar without reference

View additional legislative information at the LPITS web site.


(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

(A390, R477, H3915)

AN ACT TO AMEND CHAPTER 7, TITLE 44, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO HOSPITALS, BY ADDING ARTICLE 25 SO AS TO AUTHORIZE THE BOARD OF TRUSTEES OF THE MEDICAL UNIVERSITY OF SOUTH CAROLINA (MUSC) TO ENTER INTO LEASE, SALE, AND OTHER AGREEMENTS TO TRANSFER THE MANAGEMENT AND OPERATIONS OF THE MEDICAL UNIVERSITY HOSPITAL INCLUDING ITS LAND, FACILITIES, AND ASSETS TO ONE OR MORE PRIVATE OPERATORS UNDER CERTAIN TERMS AND CONDITIONS, TO DESCRIBE THE LAND, FACILITIES, AND ASSETS WHICH ARE THE SUBJECT OF THESE AGREEMENTS, AND TO PROVIDE THAT UNIVERSITY MEDICAL ASSOCIATES (UMA) IS A PUBLIC BODY FOR PURPOSES OF THE FREEDOM OF INFORMATION ACT; TO REQUIRE THE PRIVATE OPERATOR, THE COLUMBIA/HCA HEALTHCARE CORPORATION (HCA), UPON APPROVAL OF THE SALE OR LEASE OF MUSC'S FACILITIES AND ASSETS, TO CREATE AN EMPLOYEE GRIEVANCE COMMITTEE FOR REVIEW OF ALL EMPLOYEE DISCIPLINARY ACTIONS AND TERMINATIONS BY HCA, AND TO PROVIDE THAT THE FINAL DECISION IN ANY GRIEVANCE INVOLVING A FORMER MUSC EMPLOYEE RESTS WITH THE BOARD OF DIRECTORS OF MUSC AND THAT THE FINAL DECISION IN GRIEVANCES INVOLVING HCA EMPLOYEES RESTS WITH THE OFFICIAL DESIGNATED BY HCA; TO REQUIRE THE BUDGET AND CONTROL BOARD TO CONSULT WITH THE SOUTH CAROLINA COMMISSION ON HIGHER EDUCATION BEFORE AUTHORIZING THESE TRANSACTIONS; TO PROHIBIT A CURRENT EMPLOYEE OF MUSC OR UMA FROM PERSONALLY PROFITING FROM ANY TRANSACTION AUTHORIZED HEREBY IF THAT PERSON PLAYED A SUBSTANTIAL ROLE IN THE NEGOTIATION PROCESS AND TO DEFINE THE TERM "SUBSTANTIAL ROLE" FOR THIS PURPOSE, TO PROVIDE THAT NO CONDITION OF ANY LEASE OR AGREEMENT SHALL RESTRICT MUSC EMPLOYEES TO SHARED PARTICIPATION WITH ONE COMPANY'S HEALTH CARE THIRD PARTY PROVIDERS, TO PROVIDE THAT AT THE TIME OF DEFAULT BY HCA OR AT THE END OF THE LEASE, MUSC SHALL NOT BE REQUIRED TO PURCHASE THE MEDICAL CENTER AS A GOING CONCERN BUT RATHER AT THE APPRAISED VALUE OF THE TANGIBLE ASSETS OWNED BY THE LESSEE AS PERSONAL PROPERTY INVENTORY; TO REQUIRE THE CONSENT OF THE MUSC BOARD OF TRUSTEES FOR ANY DISCONTINUATION OR TRANSFER OF ANY INPATIENT CLINICAL SERVICE OFFERED AT THE MEDICAL CENTER; TO PROVIDE THAT UMA AGREEMENTS WITH ITS SERVANTS, AGENTS, SUBSIDIARIES, AND PARTNERS ARE SUBJECT TO REVIEW AND APPROVAL BY THE MUSC BOARD OF TRUSTEES AND MAY NOT CONFLICT WITH THE TERMS AND CONDITIONS OF THE TRANSACTIONS AUTHORIZED HEREBY; TO REQUIRE MEMBERS OF THE GENERAL ASSEMBLY TO PAY CO-PAYMENTS OR DEDUCTIBLES FOR SERVICES RECEIVED AT A HOSPITAL FACILITY IN THIS STATE WHETHER OR NOT THE SERVICES ARE PROVIDED BY THE MUSC HOSPITAL; TO REQUIRE MUSC, UPON APPROVAL OF THESE TRANSACTIONS, TO MAINTAIN THE CURRENT LEVEL OF SERVICES OFFERED TO INDIGENT PATIENTS AT CHARLESTON MEMORIAL HOSPITAL UNLESS THE MUSC BOARD APPROVES OTHERWISE; AND TO REQUIRE ANY FINANCIAL OBLIGATIONS UNDER AGREEMENTS ENTERED INTO BY A SUBSIDIARY CORPORATION TO BE UNCONDITIONALLY GUARANTEED BY THE PARENT CORPORATION OF THE PURCHASER OR TENANT.

Be it enacted by the General Assembly of the State of South Carolina:

Lease or sale of MUSC facilities and assets; UMA a public body for FOI purposes

SECTION 1. Chapter 7, Title 44 of the 1976 Code is amended by adding:

"Article 25

Medical University of South Carolina

Lease and Sale of Certain Assets

Section 44-7-3110. The General Assembly authorizes and grants to the Board of Trustees of the Medical University of South Carolina authority to enter into reasonable agreements to transfer the management and operations of the Medical University Hospital to one or more private operators, including authority to:

(A) Lease certain Medical University Hospital land, together with all easements, rights, privileges, and appurtenances appertaining thereto, and all of the buildings, structures, fixtures, and other improvements existing and situated on that land, all as described in Section 44-7-3120; and

(B) Sell furniture, fixtures, equipment, accounts receivable, and other incidental assets associated with or employed in the operation of the Medical University Hospital on the land.

Provided, however, that the following terms and conditions must be observed and included and accepted in the agreements:

(1) The term of the lease and any extensions may not exceed a total aggregate period of thirty years.

(2) The leased premises may be used only for the operation of hospitals and clinics, and for other uses reasonably related to hospitals, clinics, and health care, provided that those operations and uses are consistent with all Joint Commission on Accreditation and Healthcare Organizations standards.

(3) Any private operator or operators chosen by the Medical University of South Carolina's Board of Trustees to operate the Medical University Hospital shall not transfer, sell, lease, or assign control of the Medical University Hospital, or of the entity operating or controlling the Medical University Hospital or of any of its related real estate or other assets, to any other private operator without the prior express written approval of the Medical University of South Carolina Board of Trustees and without compliance with the same terms and conditions provided in this article. Prior to any such transfer, sale, lease, or assignment of control, the Medical University of South Carolina shall have the right of first refusal and be given sufficient time to consider and decide whether to exercise the right of first refusal.

(4) Any private operator or operators chosen by the Medical University of South Carolina's Board of Trustees to operate the Medical University Hospital must provide indigent care in the same manner as is being provided by the Medical University of South Carolina through the operation of this Medical University Hospital and its clinical programs.

(5) The Medical University of South Carolina and the State of South Carolina must be protected from any tort liability arising from the private operation of the Medical University Hospital by the private operator, unless and except to the extent the tort liability is caused by or attributed to the Medical University of South Carolina or the State of South Carolina, or both. The agreement will require the operator of the Medical University Hospital to acquire and keep in effect sufficient insurance policies to provide a reasonable amount and type of coverage and naming the Medical University of South Carolina as an additional insured.

(6) The name and logo of the Medical University of South Carolina and its affiliates shall not be used by any private operator to market and promote health care services.

(7) The proceeds from this lease and from the sale of these assets must be used for the retirement of outstanding indebtedness incurred to finance Medical University Hospital facilities, and all other revenues and payments received from or in connection with this lease or sale must be dedicated solely for use of the Medical University of South Carolina's business and operations as the Board of Trustees of the Medical University of South Carolina may direct, subject to review by the appropriate bodies of state governments.

(8) All agreements, the manner in which all agreements are made and the implementation of all agreements must comply with all applicable laws.

(9) Access for any person or group to use the services of the Medical University Hospital and clinical services shall not be limited, restricted, denied, or allowed in a discriminatory manner that is prohibited by law; nor shall such access be denied based on lack of participation or membership in a particular health plan or network.

(10) The Medical University of South Carolina shall have access at all times to all records of all patients treated at the Medical University Hospital, and all patients shall have access at all times to their own records.

Provided, further, that the lease and sale may not be finalized until the Budget and Control Board is satisfied that the consideration paid by the private operator or operators for the agreements authorized by this article reflects a fair and reasonable value to the State of South Carolina, based upon either the net book value of the hospital, capitalization of income from operation of the hospital over a period of years, the net present value of future cash flow of the hospital, a direct comparison to a comparable transaction, or some other financially sound and general practiced method of business evaluation.

The Budget and Control Board is directed to cause the lease and purchase agreements regarding the Medical University Hospital to contain provisions requiring and ensuring compliance with the terms and conditions stated above. To assist the board in performing this function, the Medical University of South Carolina is required to provide, at its expense, any information, studies, evaluations, agreements, reports, or other data requested by the Budget and Control Board, including any such items with regard to University Medical Associates or any of its employees, officers, and affiliates. The approval requirement for the transaction authorized in this act shall be governed by the provisions of Section 1-11-65 of the 1976 Code, and compliance with the provisions of this act is exclusive and shall satisfy the approval requirements of any and all other statutory provisions requiring the review and/or approval of any agency, department, or division.

No lease or other agreement pursuant to this article shall be valid unless and until the provisions of this article have been complied with fully and the Budget and Control Board has certified that the provisions of this article have been complied with fully.

Section 44-7-3120. The legal description of the land and improvements thereon referenced in Section 44-7-3110(A) is as follows:

All that certain property and parcels of land in Charleston County together with improvements thereon lying on the north side of Albert B. Sabin Street, between Ashley Avenue and Jonathan Lucas Street consisting of the MUSC Teaching Hospital and the MUSC Children's Hospital but saving and excepting the Clinical Sciences Building and the Storm Eye Institute;

Together with a rectangular parcel located on the south side of Albert B. Sabin Street containing certain fuel oil tanks;

Together with the Psychiatric Institute located on the west side of President Street and the playground area located to the rear of such institute but saving and excepting the auditorium, the lobby area, and the University Services Building.

The above referenced properties are as shown on a survey prepared by Forsburg Engineering & Surveying, Inc., to be recorded and reference is made thereto for a description of the metes and bounds thereof.

Section 44-7-3130. Notwithstanding any other provision of law to the contrary, University Medical Associates (UMA) is a public body as defined by Chapter 4, Title 30 (the Freedom of Information Act) for purposes of the act and the provisions of the act apply to records maintained by UMA."

Employee grievances

SECTION 2. Upon approval of the proposed sale or lease of MUSC's facilities and assets to HCA, HCA shall take the steps necessary to create an employee grievance committee for the review of all employee disciplinary actions and terminations by HCA. The grievance procedure must provide that the final decision in any grievance involving a former MUSC employee rests with the board of directors of MUSC and that the final decision in grievances involving HCA employees rests with the official designated by HCA.

Consultation required

SECTION 3. Notwithstanding any other provision of law, the Budget and Control Board must consult the South Carolina Commission on Higher Education prior to granting authorization to effectuate the transaction provided for in this act.

Personally profiting prohibited

SECTION 4. Notwithstanding any other provision of law to the contrary, upon approval of the proposed lease and sale of Medical University of South Carolina facilities and assets, no one who is currently an employee of MUSC or UMA may personally profit from the transaction by accepting compensation or other financial incentives from the purchasing and/or leasing company if that individual played a substantial role in the negotiation process. As used in this section "substantial role" means a role where one is providing direct advice to the members of a negotiating team or being a member of a negotiating team.

Shared participation permitted

SECTION 5. No condition of any lease or agreement shall restrict MUSC employees to shared participation with one company's health care third party providers.

Valuation of purchase upon default or expiration of lease

SECTION 6. At the time of default by Columbia HCA or end of the lease, MUSC shall not be required to purchase the Medical Center as a going concern but rather at the appraised value of the tangible assets owned by the lessee as personal property inventory.

Written consent required for discontinuation or transfer of inpatient clinical service

SECTION 7. Any discontinuation or transfer of any inpatient clinical service offered at the Medical Center shall be with the prior written consent of the MUSC Board of Trustees.

UMA agreements subject to review and approval; agreements must not conflict

SECTION 8. All agreements between University Medical Associates and any of its servants, agents, and subsidiaries and partners are subject to review and approval by the Board of Trustees of the Medical University of South Carolina and the terms of any such agreements shall not conflict with the terms and conditions of the lease authorized by this section.

Co-payment required for members of the General Assembly

SECTION 9. Notwithstanding any other provision of law to the contrary, including any provision of the Annual General Appropriations Act for FY 1996-97, members of the General Assembly must pay any co-payment or deductible as may be applicable for receiving services at a hospital facility in this State whether or not their services are provided by the MUSC hospital or its successor in interest.

Indigent patient services

SECTION 10. Notwithstanding any other provision of law to the contrary, upon approval of the proposed sale or lease of MUSC's facilities and assets, MUSC must maintain the current level of services currently offered to indigent patients at Charleston Memorial Hospital unless the MUSC Board of Trustees approves otherwise.

Guarantee of financial obligations

SECTION 11. Notwithstanding any other provision of law to the contrary, any financial obligation under the agreements entered into by a subsidiary corporation must be unconditionally guaranteed by the ultimate parent corporation of the purchaser/tenant.

Time effective

SECTION 12. This act takes effect upon approval by the Governor.

Approved the 5th day of June, 1996.