§300s–1a — Title 42 The Public Health and Welfare | U.S. Code

Summary

If a facility that got federal money is sold, transferred, or stops being a public health center or a nonprofit hospital/outpatient/long-term care/rehab facility within 20 years after its construction or modernization, the owner or seller must send the Secretary a written notice within 10 days of the sale, transfer, or change. The United States can try to get money back. The amount recovered is the federal share of the original construction or modernization cost applied to the current value of the part of the facility that was the approved project. When recovery can start depends on timing and notice. In most cases recovery may begin after 180 days following the sale, transfer, or change if the required notice was given. If no notice was given, recovery can start on the date of the sale, transfer, or change. Special rules apply for events before July 18, 1984: recovery may begin 30 days after July 18, 1984 or, if later, 180 days after the sale, transfer, or change. The Secretary may waive the government’s right to recover for certain transfers if the buyer creates an irrevocable trust equal to the greater of twice the remaining obligation under clause (ii) of section 300s–1(b)(1)(K) or the recovery amount, the trust is used only to provide the required care under that clause, and the buyer meets the other listed obligations; the Secretary may also waive recovery for a change of use for good cause. The government’s recovery right is not a lien on the facility.

Title 42, §300s–1a

The Public Health and Welfare — Source: USLM XML via OLRC

(a)If any facility with respect to which funds have been paid under this subchapter shall, at any time within 20 years after the completion of construction or modernization—

(1)be sold or transferred to any entity (A) which is not qualified to file an application under section 300s–1 or 300t–12 of this title or (B) which is not approved as a transferee by the State Agency of the State in which such facility is located, or its successor, or

(2)cease to be a public health center or a public or other nonprofit hospital, outpatient facility, facility for long-term care, or rehabilitation facility,

(b)The transferor of a facility which is sold or transferred as described in subsection (a)(1), or the owner of a facility the use of which is changed as described in subsection (a)(2), shall provide the Secretary written notice of such sale, transfer, or change not later than the expiration of 10 days from the date on which such sale, transfer, or change occurs.

(c)(1)Except as provided in paragraph (2), the amount the United States shall be entitled to recover under subsection (a) is an amount bearing the same ratio to the then value (as determined by the agreement of the parties or in an action brought in the district court of the United States for the district for which the facility involved is situated) of so much of the facility as constituted an approved project or projects as the amount of the Federal participation bore to the cost of the construction or modernization of such project or projects.

(2)(A)After the expiration of—

(i)180 days after the date of the sale, transfer, or change of use for which a notice is required by subsection (b) in the case of a facility which is sold or transferred or the use of which changes after July 18, 1984, or

(ii)thirty days after July 18, 1984, or if later 180 days after the date of the sale, transfer, or change of use for which a notice is required by subsection (b), in the case of a facility which was sold or transferred or the use of which changed before July 18, 1984,

(B)The period referred to in subparagraph (A) is the period beginning—

(i)in the case of a facility which was sold or transferred or the use of which changed before July 18, 1984, thirty days after such date or if later 180 days after the date of the sale, transfer, or change of use for which a notice is required by subsection (b).11 So in original. The period probably should be a comma.

(ii)in the case of a facility with respect to which notice is provided in accordance with subsection (b), upon the expiration of 180 days after the receipt of such notice, or

(iii)in the case of a facility with respect to which such notice is not provided as prescribed by subsection (b), on the date of the sale, transfer, or changes of use for which such notice was to be provided,

(d)(1)The Secretary may waive the recovery rights of the United States under subsection (a)(1) with respect to a facility in any State if the Secretary determines, in accordance with regulations, that the entity to which the facility was sold or transferred—

(A)has established an irrevocable trust—

(i)in an amount equal to the greater of twice the cost of the remaining obligation of the facility under clause (ii) of section 300s–1(b)(1)(K) of this title or the amount, determined under subsection (c), that the United States is entitled to recover, and

(ii)which will only be used by the entity to provide the care required by clause (ii) of section 300s–1(b)(1)(K) of this title; and

(B)will meet the obligation of the facility under clause (i) of section 300s–1(b)(1)(K) of this title.

(2)The Secretary may waive the recovery rights of the United States under subsection (a)(2) with respect to a facility in any State if the Secretary determines, in accordance with regulations, that there is good cause for waiving such rights with respect to such facility.

(e)The right of recovery of the United States under subsection (a) shall not constitute a lien on any facility with respect to which funds have been paid under this subchapter.

Notes & Related Subsidiaries

Editorial Notes

Codification Section was formerly classified to section 300s–1 of this title prior to the general revision of this subchapter by Pub. L. 96–79.

Prior Provisions

A prior section 1622 of act July 1, 1944, as added Jan. 4, 1975, Pub. L. 93–641, § 4, 88 Stat. 2265, was renumbered section 1602 as part of the general revision of this subchapter by Pub. L. 96–79 and is classified to section 300q–2 of this title.

Amendments

1984—Pub. L. 98–369 amended section generally. Prior to the amendment, section read as follows: “(a) If any facility constructed, modernized, or converted with funds provided under this subchapter is, at any time within twenty years after the completion of such

Construction

, modernization, or conversion with such funds— “(1) sold or transferred to any person or entity (A) which is not qualified to file an application under section 300s–1 or 300t–12 of this title or (B) which is not approved as a transferee by the State Agency of the State in which such facility is located, or its successor; or “(2) not used as a medical facility, and the Secretary has not determined that there is good cause for termination of such use, the United States shall be entitled to recover from either the transferor or the transferee in the case of a sale or transfer or from the owner in the case of termination of use an amount bearing the same ratio to the then value (as determined by the agreement of the parties or by action brought in the district court of the United States for the district in which the facility is situated) of so much of such facility as constituted an approved project or projects, as the amount of the Federal participation bore to the cost of the

Construction

, modernization, or conversion of such project or projects. Such right of recovery shall not constitute a lien upon such facility prior to judgment. “(b) The Secretary may waive the recovery rights of the United States under subsection (a) of this section with respect to a facility in any State— “(1) if (as determined under

Regulations

prescribed by the Secretary) the amount which could be recovered under subsection (a) of this section with respect to such facility is applied to the development, expansion, or support of another medical facility located in such State which has been approved by the Statewide Health Coordinating Council for such State as consistent with the State health plan established pursuant to section 300m–3(c) of this title; or “(2) if the Secretary determines, in accordance with

Regulations

, that there is good cause for waiving such requirement with respect to such facility. If the amount which the United States is entitled to recover under subsection (a) of this section exceeds 90 per centum of the total cost of the

Construction

or modernization project for a facility, a waiver under this subsection shall only apply with respect to an amount which is not more than 90 per centum of such total cost.” 1979—Subsec. (a)(1)(A). Pub. L. 96–79, § 203(c), substituted “section 300s–1 or 300t–12 of this title” for “section 300o–3 of this title”.

Statutory Notes and Related Subsidiaries

Effective Date

of 1979 AmendmentAmendment by Pub. L. 96–79 effective Oct. 1, 1979, see section 204 of Pub. L. 96–79, set out as a note under section 300q of this title.

Regulations

and PersonnelRequirements for

Regulations

and personnel to implement this section, see section 2381(c) of Pub. L. 98–369, set out as a note under section 291i of this title.

§300s–1a Recovery of expenditures under certain conditions

Summary

Title 42, §300s–1a

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

Amendments

Construction

Construction

Regulations

Regulations

Construction

Statutory Notes and Related Subsidiaries

Effective Date

Regulations

Regulations

Citations & Metadata