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Certificate of Need Program:  2007 Annual Activity Report

CON Applications

Anchorage

May 8, 2007 — Fresenius Medical Care submitted a CON application for a 20-station dialysis facility in Anchorage. The total project cost is $4,972,459 with a completion date of September 2008. The review was postponed 60 days to permit Liberty Dialysis Alaska to submit a CON application to be reviewed concurrently. The staff analysis was submitted to the Commissioner on December 12, and a decision on the project will be made by February 27, 2008.  

October 4, 2007 — Liberty Dialysis Alaska submitted a CON application for a 20-station dialysis facility in Anchorage that will also offer home-dialysis. The total project cost is $4,112,000 with a completion date of December 2008. This project was reviewed concurrently with the Fresenius application. The staff analysis was submitted to the Commissioner December 12, and a decision will be made by February 27, 2008. 

November 27, 2007 — Providence Alaska Medical Center’s CON application to expand Neonatal Intensive Care Unit was approved as requested. The project proposes renovation of 2,408 square feet to accommodate six additional NICU bassinettes, at an approved project cost of $1,717,448 and completion date of June 2008.  The application was submitted on June 27, 2007.

May 3, 2007 — Providence Alaska Medical Center’s CON application to expand cardiovascular observation was approved as requested.  The project will remodel 1,634 square feet of space, add six new observation bays, and purchase new stretchers and a nurse call system for all 15 observation bays. The approved cost is $1,312,575 with a completion date of December 31, 2007. The application was submitted January 12, 2006.

May 8, 2007 —   Alaska Regional Hospital’s CON application to add one interventional neuroradiology catheterization laboratory was approved as requested. A Phillips Integrated 3D Neuro Biplane Flat Detector will be purchased and renovation made at a project total cost of $2.15 million.  This project was initially reviewed concurrently with Providence Alaska Medical Center. During the review, staff concluded the projects were for different types of services and separate recommendations were made for each project. ARH submitted their application on October 11, 2006.

June 26, 2007 — A certificate of need for Providence Alaska Medical Center (PAMC) was approved for one cardiac catheterization lab at a cost of $2,935,670 with a completion date of December 31, 2007. On January 12, 2007 PAMC submitted a CON application to build two catheterization labs at a cost of $5,001,614. Only one lab was approved because it was determined there was only a need for one new cardiac cath lab.  The application began as a concurrent review with the Alaska Regional Hospital Neuroradiology Suite. Staff concluded that the projects were for different types of services and recommendations were made separately for each project.

October 18, 2007 — A CON for Providence Alaska Medical Center to move and expand the Sports Medicine and Rehabilitation Therapy Units was approved. PAMC built this project and began operations before a CON was submitted. Letters of determination stating a CON was required were mailed on two different occasions: May 10, 2006, and January 24, 2007. A CON application was received on March 24, 2007. PAMC was disallowed $52,842.38 in Medicaid payments for operations without a CON.

Fairbanks
March 30, 2007 — The Commissioner approved a CON for Fairbanks Memorial Hospital (FMH) to renovate 2,570 square feet for a cardiac catheterization laboratory.  Since FMH does not have access to open-heart surgery, approval of the Lab was conditional on developing: 1)  a plan to screen out high-risk patients,  2) a plan for quality oversight; and 3) a plan for transporting  patients to a hospital with open-heart surgery when needed. Theproject includes relocation of outpatient physical therapy and home care to a nearby location. The project was approved to spend $7,136,787 with a completion date of December 31, 2007. The CON application was received on November 15, 2006.

Homer
November 27, 2007 — South Peninsula Hospital (SPH) in Homer submitted a CON application for renovation and expansion costing $32,600,000 on July 5, 2007. The project includes remodeling/expansion of: Emergency Services, Diagnostic Imaging, Surgery/Recovery/Pre-and Post Operative space, Pharmacy, Acute Care Nursing, Laundry, Materials Management, Central Sterile Processing, Laboratory, and Medical Records/Health Information. It was determined during the review that substantial construction had been completed before CON approval. On September 26 a cease and desist letter was sent to the facility to halt construction pending completion of the CON review. The CON was partially approved for $17,330,358 with a completion date of December 31, 2009.  An 18-bed acute care wing, expansion of surgery, laboratory, pharmacy, respiratory therapy and a fifth Emergency treatment room totaling $15.1 million were denied due to a lack of proper planning and documentation,. On December 18, 2007, the applicant appealed the decision to deny a major portion of the project and the appeal process continued into 2008.

Soldotna
June 12, 2007 — Fresenius Medical Care submitted a CON application to develop a seven-station dialysis facility in Soldotna. The total cost of the project is $2,566,998 and the estimated completion date is late fall of 2008. On June 27, 2007, the department received a letter from Liberty Dialysis - Alaska stating its intent to submit a competing application for dialysis services in Soldotna.  A concurrent staff analysis with Liberty will be submitted to the Commissioner by January 14, 2008.

September 28, 2007 — Liberty Dialysis Alaska submitted a CON application for an eight-station dialysis facility with two home training stations in Soldotna. The total project cost was $3,601,130 with a completion date of August 2008.  A concurrent staff analysis with Fresenius will be submitted to the Commissioner by January 14, 2008.

Letters of Intent and Requests for Determination

Anchorage
June 29, 2007 — Diagnostic Imaging of Alaska (DIA) in Anchorage submitted a request for determination for the purchase of a new GE 1.5T Horizon LX magnetic resonance imaging (MRI) scanner. The total cost of the project is greater than $1,200,000 and exceeds the expenditure threshold for a certificate of need. On July 6, 2007, additional information was requested. On October 11, 2007, a determination was made that a CON was not required because DIA is physicians’ office not a health care facility.

October 1, 2007 — Advanced Sonograms of Alaska requested determination on whether a CON is needed to provide outpatient ultrasound services in a 1600 square foot leased office space in Anchorage. The estimated total cost for the proposal is $660,000. The Commissioner responded with a letter dated October 18, 2007, requesting additional information. The additional information was not received before the end of the year. Refer to 2008 activity for more information on this project.

July 6, 2007 — The Commissioner issued a determination that a CON is not required by North Star Hospital in Anchorage to convert 34 Residential Psychiatric Treatment Center Beds to Specialized Acute Care Hospital Beds at a total project cost estimated between $647,302 and $789,709. A CON is not required for this project because the cost is below the $1.150 million threshold that triggers a CON requirement under AS 18.07.031(d).

Fairbanks
February 27, 2007 — The Commissioner determined that a CON is not required for a proposal by Diagnostic Imaging of Alaska to place a mobile MRI on a lot to be purchased within the City of Fairbanks. The total project cost was $1,025,000, which is less than the statutory CON threshold of $1.1 million which triggers the CON requirement.

October 26, 2007 — The department received a request for determination from the Greater Fairbanks Community Hospital Foundation for acquisition of the Tanana Valley Clinic for an undisclosed amount. Banner Health will operate the clinic under a contractual relationship with the Foundation similar to their contract with Fairbanks Memorial Hospital. On November 15 a determination was made that a CON was not required because the activity is not a construction project.

Juneau
January 23, 2007 — The Commissioner issued a determination that Juneau Bone and Joint Center did not require a CON to purchase and install an MRI. The total estimated project cost is $1,400,000. A CON was not required because the Juneau Bone and Joint Center is considered a physicians' office and exempt from CON under AS 18.07.111(8) (B).

Wasilla
January 2, 2007 — The Commissioner issued a determination that a CON is not required to replace a Toshiba Opart MRI Scanner at Alaska Open Imaging Center's Wasilla facility with a Toshiba Vantage MRI scanner located at the provider's Fairbanks facility. The book value and installation costs of the replacement total $894,920.  A CON was not required because project is considered a routine replacement.

October 19, 2007 — The Commissioner issued a determination that a CON is not required for purchase of a Toshiba Aquilon 16-Slice CT scanner by Alaska Open Imaging Center of Wasilla.  The estimated cost of the scanner was $460,537.  A CON was not required because the cost of the proposed project is below the minimum cost that triggers the CON requirement under AS 18.07.031(d).

CON Appeals and Reconsiderations

Anchorage
October 5, 2007 — The Commissioner issued a final order and decision on appeal following a May 2005 CON application from the joint venture between Advanced Pain Centers of Alaska and Providence to lease a facility in south Anchorage and develop six operating suites and 18 pre/post-operative. The decision upheld a previous denial on January 19, 2006, because of excess surgery capacity available in the area. The applicants appealed this decision and more details may be found in the 2008 annual report.

Fairbanks
October 9, 2007 — The Commissioner issued a Decision after Remand regarding the concurrent applications for surgery suites in Fairbanks. Alaska Medical Development, Kobuk Ventures and Fairbanks Memorial Hospital submitted CON applications that were reviewed concurrently. On September 29, 2006, certificates of need were approved for Kobuk Ventures to develop a two-suite ambulatory surgery center, Alaska Medical Development to develop a two-suite ambulatory surgery center, and Fairbanks Memorial Hospital to relocate and upgrade a surge capacity surgery suite. The three entities filed appeals to the Commissioner’s decisions. The Decision after Remand denied Alaska Medical Development’s application, awarded Kobuk Ventures a certificate of need for two ambulatory surgery suites, and affirmed the award of a CON to Fairbanks Memorial Hospital. Alaska Medical Development has filed a petition for reconsideration. Additional information on this appeal is contained in the 2008 annual CON report.

Fairbanks
June 11, 2007 — The Commissioner issued a determination on reconsideration in which a previous determination vacated: that a CON is required by Aurora Diagnostic Imaging (ADI) in Wasilla for purchase of an MRI unit. The Department received a request for determination on February 5, 2007.  Following a request for information the Commissioner issued her determination on March 8 that ADI was an Independent Diagnostic Testing Facility and therefore considered a “health care facility” under AS 18.07.111(8) and the total project cost exceeded $1,100,000 under AS 18.07.031, thus requiring a CON. A determination of reconsideration was made on April 11, in which the original determination was upheld. The applicant filed a complaint in superior court, followed by a request for remand by the Department. Additional information on this appeal is in the 2008 annual CON report.

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