42 U.S.C. § 248b: Transfer or financial…

Summary

All Public Health Service hospitals and clinics must be closed, moved to another owner, or run without direct federal money by September 30, 1982. The Secretary of Health and Human Services must tell each hospital and the local and state leaders by July 1, 1981 that proposals to take over a facility or make it financially independent are welcome. Proposals must arrive by September 1, 1981. The Secretary must decide by September 30, 1981 whether a proposal will keep the place as a general health care provider, keep serving current patients, and has a real chance to stay financially viable (or become self-supporting if it is not being transferred). Small, separate parts of a hospital moved to a local public entity to serve refugees are treated differently. If no acceptable proposal is offered, the Secretary must close the facility by October 31, 1981. If a proposal is approved, the Secretary may run or help run the facility until it is transferred or becomes self-sufficient, and must use available funds to fix licensing, accreditation, and other legal or staffing needs so the transfer or independence happens by September 30, 1982. A special office in the Assistant Secretary for Health will watch over this work. A hospital still using direct appropriated funds cannot be called financially self-sufficient.

Title 42, §248b

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

(a)Deadline for closure, transfer, or financial self-sufficiency

The Secretary of Health and Human Services (hereinafter in this subtitle referred to as the “Secretary”) shall, in accordance with this section and notwithstanding section 248a of this title, provide for the closure, transfer, or financial self-sufficiency of all hospitals and other stations of the Public Health Service (hereinafter in this subtitle referred to as the “Service”) not later than September 30, 1982.

(b)Proposals for transfer or financial self-sufficiency

Not later than July 1, 1981, the Secretary shall notify each Service hospital and other station, and the chief executive officer of each State and of each locality in which such a hospital or other station is located, that the Secretary will accept proposals for the transfer of each such hospital and station from the Service to a public (including Federal) or nonprofit private entity or for the achievement of financial self-sufficiency of each such hospital and station not later than September 30, 1982. No such proposal shall be considered by the Secretary if it is submitted later than September 1, 1981.

(c)Evaluation of proposals

The Secretary shall evaluate promptly each proposal submitted under subsection (b) with respect to a hospital or other station and determine, not later than September 30, 1981, whether or not under such proposal the hospital or station—

(1)will be maintained as a general health care facility providing a range of services to the population within its service area,

(2)will continue to make services available to existing patient populations, and

(3)has a reasonable expectation of financial viability and, in the case of a hospital or station that is not proposed to be transferred, of financial self-sufficiency.

Paragraph (1) shall not apply in the case of a proposal for the transfer of a discrete, minor, freestanding part of a hospital or station to a local public entity for the purpose of continuing the provision of services to refugees.

(d)Rejection or approval of proposal

(1)If the Secretary determines that a proposal for a hospital or other station does not meet the standards of subsection (c) or if there is no proposal submitted under subsection (b) with respect to a hospital or other station, the Secretary shall provide for the closure of the hospital or station by not later than October 31, 1981.

(2)If the Secretary determines that a proposal for a hospital or other station meets the standards of subsection (c), the Secretary shall take such steps, within the amounts available through appropriations, as may be necessary and proper—

(A)to operate (or participate or assist in the operation of) the hospital or station by the Service until the transfer is accomplished or financial self-sufficiency is achieved,

(B)to bring the hospital or station into compliance with applicable licensure, accreditation, and local medical practice standards, and

(C)to provide for such other legal, administrative, personnel, and financial arrangements (including allowing payments made with respect to services provided by the hospital or station to be made directly to that hospital or station) as may be necessary to effect a timely and orderly transfer of such hospital or station (including the land, building, and equipment thereof) from the Service, or for the financial self-sufficiency of the hospital or station, not later than September 30, 1982.

(e)Establishment of identifiable administrative unit

There is established, within the Office of the Assistant Secretary for Health of the Department of Health and Human Services, an identifiable administrative unit which shall have direct responsibility and authority for overseeing the activities under this section.

(f)Finding of financial self-sufficiency

For purposes of this section, a hospital or station cannot be found to be financially self-sufficient if the hospital or station is relying, in whole or in part, on direct appropriated funds for its continued operations.

Notes & Related Subsidiaries

Editorial Notes

References in Text

This subtitle, referred to in subsec. (a), is subtitle J of title IX of Pub. L. 97–35, §§ 985 to 988, Aug. 13, 1981, 95 Stat. 602, which enacted this section, amended section 201, 249, and 254e of this title, and enacted provisions set out as notes under this section and section 249 of this title. For complete classification of this subtitle to the Code, see Tables. section 248a of this title, referred to in subsec. (a), was in the original “section 818 of Public Law 93–155”, meaning section 818 of Pub. L. 93–155, title VIII, Nov. 16, 1973, 87 Stat. 622, which enacted section 248a of this title and repealed section 3 of Pub. L. 92–585, Oct. 27, 1972, 86 Stat. 1292. Codification Section was enacted as part of the Omnibus Budget Reconciliation Act of 1981, and not as part of the Public Health Service Act which comprises this chapter.

Statutory Notes and Related Subsidiaries

Congressional Findings and Declaration of Purpose Pub. L. 97–35, title IX, § 985, Aug. 13, 1981, 95 Stat. 602, provided that: “(a) Congress finds that—“(1) because of national budgetary considerations, it has become necessary to terminate Federal appropriations for Public Health Service hospitals and clinics, “(2) with proper planning and coordination, some of these hospitals and clinics could be transferred to State, local, or private control or become financially self-sufficient and continue to provide effective and efficient health care to individuals in the areas in which they are located, “(3) a precipitous closure of these hospitals and clinics will preclude the possibility of such orderly transfer to entities which are willing and able to take over operations at such facilities and will cause unnecessary and costly hardships on the patients and staffs at such facilities and on the communities in which the facilities are located, and “(4) it is in the national interest, consistent with sound budgetary considerations, to assist in the orderly and prompt transfer of such operations to State, local, or private operation or in the achievement of financial self-sufficiency where feasible. “(b) The purposes of this subtitle [enacting this section, amending section 201, 249, and 254e of this title, and enacting provisions set out as notes under section 249 of this title] are—“(1) to provide for the prompt and orderly closure by

October 31, 1981, of Public Health Service hospitals and clinics which cannot reasonably be transferred to State, local, or private operation or become financially self-sufficient and for the transfer or achievement of financial self-sufficiency by

September 30, 1982, of those hospitals and clinics which can be so transferred or which can achieve such financial self-sufficiency, and “(2) to provide for transitional assistance for merchant seamen whose entitlement to receive free care through Public Health Service hospitals and clinics is repealed and who are hospitalized at the end of fiscal year 1981 and require continuing hospitalization.”

§248b Transfer or Financial Self-sufficiency of Public Health Service Hospitals and Clinics