Subchapter A. GENERAL PROVISIONS

The Texas Department of Health (department) proposes the repeal of §134.3, and new §134.3 concerning the regulation of private psychiatric hospitals and crisis stabilization units. Specifically, the section covers fees.

The proposed repeal and new section are in accordance with Health and Safety Code §577.006, as amended by House Bill 2085, 76th Legislature, 1999. The repeal of existing §134.3 will allow the section to be substantially expanded. A majority of the proposed language in new §134.3 matches language and current license fees for general and special hospitals as set out in Health and Safety Code, Chapter 133 of this title (relating to Hospital Licensing). The proposed plan review fee schedule and fee for field surveys of construction projects reviewed, generally referred to as construction inspections, that are proposed in new §134.3 are being proposed concurrently as amendments to Health and Safety Code, §133.26 of this title.

New §134.3 includes a proposed new license fee, the basis of which is the design bed capacity of the private psychiatric hospital, and an explanation of what constitutes design bed capacity. The license fee for an annual initial license or a renewal license will change from the current fee of $250 for each hospital to $10 per bed based upon the design capacity of the hospital with a minimum license fee of $200 and a maximum fee of $10,000. The proposed new plan review fee schedule will replace the current set fee of $650 each for stage one and stage two plan review. The new plan review fee schedule is based upon the estimated construction costs with fees ranging from $300 to $5,000. Language that sets out what costs should be included in the estimated construction costs is also included. The section also proposes a decrease in the fee for construction inspections, from the current fee of $650 for each inspection to $500 for each inspection. Finally, the section includes current language from existing §134.3 concerning compliance for crisis stabilization units.

Jann Melton-Kissel, Bureau of Licensing and Compliance, has determined that for each year of the first five year period the sections are in effect, there will be fiscal implications as a result of enforcing or administering the section as proposed. The proposed change in the license fees is estimated to generate additional revenues of $1,000 for FY 2000; $28,900 for FY 2001; $28,600 for FY 2002; $28,300 for FY 2003; and $28,000 for FY 2004. During FY 1999, the department conducted only one plan review and three construction inspections of private psychiatric hospitals. The proposed change in the plan review fee is estimated to generate additional revenues of $300 for FY 2000, and $1,700 for each year of fiscal years 2001-2004 for state government. The proposed fee for construction inspections is estimated to result in a decrease of $450 for each year of fiscal years 2000 - 2004 for state government. There will be no effect on local government unless a local government constructs a new private psychiatric hospital or crisis stabilization unit, or adds to, alters, converts, or renovates an existing private psychiatric hospital or crisis stabilization unit that is owned or operated by the local government. In that case, the local government would be would be subject to the new plan review fee schedule based upon the cost of construction, and the new construction inspection fee.

Ms. Melton-Kissel also has also determined that for each year of the first five years the sections are in effect, the public benefit anticipated as a result of enforcing or administering the sections will be the continuation of plan reviews of private psychiatric hospitals and crisis stabilization units with equivalent fees and rules for plan review and construction inspections for all hospitals and crisis stabilization units. There will be no cost to micro businesses or small businesses to comply with the section as proposed unless the micro or small business is a private psychiatric hospital or crisis stabilization unit which undertakes the construction of a new private psychiatric hospital building or crisis stabilization unit, or adds to, alters, converts, or renovates an existing building or unit, the business would be subject to the new plan review fee schedule based upon the cost of construction, and the new construction inspection fee.

When comparing the cost of compliance for micro businesses and small businesses to the cost of compliance for the largest businesses, the costs will be the same for each because the plan review fees are based upon the cost of the construction. The fee for construction inspections are also the same for all businesses.

There are no anticipated economic costs to persons (other than private psychiatric hospitals or crisis stabilization units) who are required to comply with the sections as proposed. There is no anticipated impact on local employment.

Comments on the proposal may be submitted to John M. Evans, Jr., Director, Hospital Licensing Program, Health Facility Licensing and Compliance Division, Texas Department of Health, 1100 West 49th Street, Austin, Texas, 78756, (512) 834-6648. Comments will be accepted for 30 days following publication of this proposal in the Texas Register .

The new section is proposed under Health and Safety Code, §577.006, regarding license fees, plan review fees, and construction inspection fees; and Health and Safety Code, §12.001, which provides the Texas Board of Health (board) with the authority to adopt rules for the performance of every duty imposed by law on the board, the department, and commissioner of health.

The new section affects Health and Safety Code, Chapters 577 and 12.

§134.3.Fees.

(a)

General.

(1)

All fees paid to the Texas Department of Health (department) are nonrefundable with the exception of inspection fees for inspections that were not conducted.

(2)

All fees shall be paid by check or money order made payable to the Texas Department of Health.

(b)

License fees.

(1)

The fee for an initial license or a renewal license is $10 per bed based upon the design bed capacity of the hospital. The total fee may not be less than $200 or more than $10,000. The design bed capacity of a hospital is determined as follows.

(A)

The design bed capacity is the maximum number of patient beds that a hospital can accommodate in rooms that comply with the requirements for nursing units in §134.53 of this title (relating to General Considerations).

(B)

The maximum design bed capacity includes beds that comply with the requirements in §134.53 of this title even if the beds are unoccupied or the space is used for other purposes such as offices or storage rooms, provided such rooms can readily be returned to patient use. All required support and service areas must be maintained in place. For example, the removal of a nurse station in an unused patient bedroom wing of 20 beds would effectively eliminate those 20 beds from the design capacity.

(C)

The number of licensed beds in a multiple occupancy room shall be determined by the design even if the number of beds actually placed in the room is less than the design capacity.

(2)

A hospital shall submit an additional fee with the notarized affidavit for final construction approval for an increase in the number of beds resulting from an approved construction project and an additional plan review fee if the construction cost increases to the next higher fee schedule according to subsection (c)(4) of this section.

(3)

A hospital will not receive a refund of previously submitted fees should the hospital's design capacity decrease as a result of an approved construction project.

(c)

Plan review fees. This subsection outlines the fees which must accompany the application for plan review and all proposed plans and specifications covering the construction of new buildings or alterations to existing buildings which must be submitted for review and approval by the department in accordance with §134.51 of this title (relating to Construction Plans, Specifications, and Inspections).

(1)

Construction plans will not be reviewed or approved until the required fee and an application for plan review are received by the department.

(2)

Plan review fees are based upon the estimated construction project costs which are the total expenditures required for a proposed project from initiation to completion, including at least the following items.

(A)

Construction project costs shall include expenditures for physical assets such as:

(i)

site acquisition;

(ii)

soil tests and site preparation;

(iii)

construction and improvements required as a result of the project;

(iv)

building, structure, or office space acquisition;

(v)

renovation;

(vi)

fixed equipment; and

(vii)

energy provisions and alternatives.

(B)

Construction project costs shall include expenditures for professional services including:

(i)

planning consultants;

(ii)

architectural fees;

(iii)

fees for cost estimation;

(iv)

legal fees;

(v)

management fees; and

(vi)

feasibility study.

(C)

Construction project costs shall include expenditures or costs associated with financing, excluding long-term interest, but including:

(i)

financial advisor;

(ii)

fund-raising expenses;

(iii)

lender's or investment banker's fee; and

(iv)

interest on interim financing.

(D)

Construction project costs shall include expenditure allowances for contingencies including:

(i)

inflation;

(ii)

inaccurate estimates;

(iii)

unforeseen fluctuations in the money market; and

(iv)

other unforeseen expenditures.

(3)

Regarding purchases, donations, gifts, transfers, and other comparable arrangements whereby the acquisition is to be made for no consideration or at less than the fair market value, the project cost shall be determined by the fair market value of the item to be acquired as a result of the purchase, donation, gift, transfer, or other comparable arrangement.

(4)

The plan review fee schedule based on cost of construction is:

(A)

$100,000 or less: $300;

(B)

$100,001 to $600,000: $850

(C)

$600,001 to 2,000,000: $2,000;

(D)

$2,000,001 to 5,000,000: $3,000;

(E)

$5,000,001 to 10,000,000: $4.000; and

(F)

$10,000,001 and over: $5,000.

(5)

If an estimated construction cost cannot be established, the estimated cost shall be based on $105 per square foot. No construction project shall be increased in size, scope, or cost unless the appropriate fees are submitted with the proposed changes.

(d)

Construction inspection fees. A fee of $500 and an application for construction inspection for each inspection shall be submitted to the department at least three weeks prior to the anticipated inspection date. Construction inspections will not be conducted until all required fees are received by the department. If additional construction inspections of the proposed project are requested by the hospital, the appropriate additional fees shall be submitted prior to any inspections conducted by the staff of the department. When followup construction inspections are performed to verify plans of correction, the fee shall be submitted upon completion of the inspection.

(e)

Compliance. Fees paid to the department for licensure applications, plan reviews, and construction inspections for crisis stabilization units shall comply with 25 TAC, Part II, Chapter 401, Subchapter K (relating to Licensure of Crisis Stabilization Units).

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on March 1, 2000.

TRD-200001650

Susan K. Steeg

General Counsel

Texas Department of Health

Earliest possible date of adoption: April 16, 2000

For further information, please call: (512) 458-7236

Subchapter C. ENFORCEMENT