Certificate of Need (CON) Overview
Like many other states, Oklahoma has an extensive CON process in place for healthcare services and facilities. Winning approval for a CON application is often a time consuming and difficult undertaking. Working with RPC provides clients with a team of consultants with experience working with CON projects.
When working on a CON project, RPC can prepare the entire CON application or sections of the application as the client prefers. When the client is defining the project and deciding whether to apply, RPC can help assess the market and regulatory situation to determine the relative likelihood of success for a project. RPC not only completes a thorough review of the competitive environment, market need and financial analysis, but also works seamlessly with the client’s staff, architects, engineers, and other outside consultants to create a solid CON application.
RPC is led by Ron Luke, JD, PhD, who has prepared CON applications and presented testimony in CON hearings since 1981 in over 20 states. RPC’s work on CON projects includes the opening of new acute care hospitals, hospices, physical rehabilitation and psychiatric specialty hospitals, ambulatory surgery centers and nursing homes, the relocation and addition of beds, and acquiring major medical equipment. Working with RPC during the CON process gives the applicant the advantage of a skilled, experienced team that can provide expert advice and produce an effective CON application.
State Agencies
Department participates in federal programs for health planning and provides support for all CON activities of the Commissioner.
State Commissioner of Health
The Commissioner holds the power to issue, deny, modify, and revoke CON applications. The Commissioner also establishes and enforces standards and requirements.
Health Facility Systems
1000 NE 10th Street, Room 1010
Oklahoma City, OK 73117
(405) 271-6868
Services that Require CON
The State of Oklahoma requires facilities to obtain a certificate of need before developing or changing long-term care (LTC) and psychiatric/chemical dependency services. The state intends for the offering of these services to be planned, orderly, economical, and consistent to the needs of the people in various regions, districts, and localities.
Long Term Care Facilities
Nursing facilities, specialized facilities for developmentally disabled clients, and hospital-based skilled nursing units must receive CON approval before:
- Establishing a new facility
- Increasing the number of beds at an existing facility (if greater than 10 percent of the current number of licensed beds)
- Acquiring ownership or operation of a facility
- Spending $1,000,000 or more on any project
Psychiatric and Chemical Dependency Treatment Facilities
Psychiatric hospitals, psychiatric units, and chemical dependency units in general acute hospitals must receive CON approval before:
- Establishing a new facility
- Increasing psychiatric or chemical dependency treatment beds at an existing facility
- Adding beds or converting existing beds to serve persons under age 18
- Transferring ownership or operation of a facility
- Spending $500,000 or more on any project
The Department can also issue CON exemptions if applicable exemption criteria are met by the applicant.
Certificate of Need Process Milestones
The types of review generally include: short (emergency), exemption, and standard. Applications can be filed at any time. The standard review process follows the path described below.
- Submit Application
The standard application includes the following information:- Contact information of applicant
- Disclosure statement (full identification of applicant, persons with controlling interest, and related legal entities OR annual/quarterly SEC filings if publicly traded)
- Historical operating and financial information
- Residents council and family council minutes
- Detailed project description including budget
- Projections of personnel needs and identification of medical director
- Construction and building information
- Justification of need
- Data/projections on financial and economic feasibility
- Completeness Review
Within 15 days of filing the application, the Department sends a notice of completeness or requests additional information from the applicant. The applicant must submit requested information within 90 days of the notice. - Public Notice
Upon completeness approval, the Department mails a notice to similar health care facilities in the service area and publishes a notice in newspapers of general circulation. These notices include the name and location of the facility, a description of the project, where the application can be viewed, and an explanation of how parties may participate in the review. - Participation in the Review Process
Any person may participate in the review process. Any evidence or argument must be submitted to the Department in writing within 20 days after the publication of the paid public notice. The Commissioner considers all submissions when rendering his final decision. - Investigation
If the Department’s investigation indicates that the application is not consistent with applicable criteria and standards, then the Department notifies the applicant of such inconsistencies in writing prior to the decision deadline. The applicant is offered an opportunity to respond in writing to the Department’s notice. - Decision
The decision to approve or deny a CON for the acquisition of a psychiatric or chemical dependency facility is rendered within 15 days after the deadline for submitting evidence and arguments. The decision to approve or deny any other type of certificate is made within 45 days after the deadline for submitting evidence and arguments. The Commissioner bases his decision on the standard review criteria and arguments from interested persons. The Department must issue a written summary of its findings and rationale for the decision. - Reconsideration Request
Any affected party may submit a written request for reconsideration within 10 days (LTC) or 30 days (psychiatric/chemical dependency) of the Department’s decision. Within 10 days after receipt of the request, the Commissioner determines whether the request has shown good cause for reconsideration and may schedule a hearing. The hearing is conducted within 30 days of the receipt of request, and written findings are issued within 45 days of the hearing. - Appeal
Any final determination by the State Department of Health may be appealed by the applicant or any other aggrieved party. The venue for such appeal shall be in Oklahoma County or in the county in which the facility at issue in the application is located.
What criteria are used to review a CON?
The Department of Health and Commissioner evaluate applications based upon the following standard criteria:
- Existing bedsare not and will not be adequate in the service area.
- Persons are unable to obtain services due to inadequate existing facilities
- Impact of the proposed LTC beds on the ratio of LTC beds to the number of persons age 75 and over statewide
- Impact of the proposed psychiatric/chemical dependency beds on the ratio of psychiatric and chemical dependency beds to the number of people statewide/ in the service area
- Target population will have access to the proposed services through public or private transportation
- The proposed action will contribute to the orderly development of services in the market
- Alternative or substitute services are not and will not be available nor adequateto meet the needs of the population.
- Alternatives to LNF beds: residential care facilities, elder care, home health care, hospice, assisted living and adult day care
- Alternatives for psych/chemical dependency beds: residential, halfway house, outpatient, and day hospitalization
- Linkages such as referral protocols or joint venture agreements with similar or complementary services
- There are adequate financial resourcesfor the new or expanded services and for the continued operation.
- Reimbursement structure
- Proposed charges in line with the prevailing rate of similar services in the service area
- Projected utilization rates sufficient to maintain cost effectiveness
- Projected cash flow shows financial viability within 3 years
- Relationship of assets to liabilities not increased by the project to the point of threatening the institution’s financial viability
- Cost/benefit analysis affirms the project’s cost-effectiveness
- Sufficient personnelwill be available to properly staff and operate the proposed new or expanded service.
- Assurance that the appropriate numbers and types of staff will be available to comply with licensure and meet program needs
- Professional and paraprofessional staffing does not compromise the staffing of existing services
- Full disclosure of all current and prior experience in the operation of health care facilities
Certificate of Need Application Filing Fee
Each application for a new certificate of need must include an application fee of $3,000. The filing fee for psychiatric review is 0.75% of the project’s capital cost, with a minimum of $1,500 and maximum fee of $10,000.
Additional Sources
(links good as of January 2022)
Oklahoma State Department of Health, Long Term Care Certificate of Need Program
https://oklahoma.gov/health/protective-health/health-resources-development-service/health-facility-systems-/nursing-home-certificate-of-need.html
Oklahoma State Department of Health, Psychiatric/Chemical Dependency Treatment Certificate of Need Program
https://oklahoma.gov/health/protective-health/health-resources-development-service/health-facility-systems-/psychiatric-and-chemical-dependency-certificate-of-need.html
Contact RPC Consulting
Should you or your client need an expert team to help you with the Oklahoma Certificate of Need Process (CON) please contact Dr. Ron Luke at 512-371-8166.
Disclaimer: The information on this page has been compiled by RPC in June 2010 and updated in January 2022 based on sources believed to be reliable. Where possible we have had the material reviewed by state CON officials or others knowledgeable of the state’s CON program. The information is not offered as legal advice. A state may change its rules, forms and procedures at any time and RPC offers no assurance that the information will be correct on the date it is viewed. Therefore the reader is urged to use this information only as a starting point for any CON application and to speak with state officials or seek legal or consulting advice early in the process.