Iowa Code § 135.63
Criteria for evaluation of applications
Redline — January 1, 2012 → current.View current text →
Current — January 1, 2026
As of January 1, 2012
1. A new institutional health service or changed institutional health service shall not be offered or developed in this state without prior application to the department for and receipt of a certificate of need, pursuant to this division. The application shall be made upon forms furnished or prescribed by the department and shall contain such information as the department may require under this division. The application shall be accompanied by a fee equivalent to three-tenths of one percent of the anticipated cost of the project with a minimum fee of six hundred dollars and a maximum fee of twenty-one thousand dollars. The fee shall be remitted by the department to the treasurer of state, who shall place it in the general fund of the state. If an application is voluntarily withdrawn within thirty calendar days after submission, seventy-five percent of the application fee shall be refunded; if the application is voluntarily withdrawn more than thirty but within sixty days after submission, fifty percent of the application fee shall be refunded; if the application is withdrawn voluntarily more than sixty days after submission, twenty-five percent of the application fee shall be refunded. Notwithstanding the required payment of an application fee under this subsection, an applicant for a new institutional health service or a changed institutional health service offered or developed by an intermediate care facility for persons with mental retardation or an intermediate care facility for persons with mental illness as defined pursuant to section 135C.1 is exempt from payment of the application fee.
2. This division shall not be construed to augment, limit, contravene, or repeal in any manner any other statute of this state which may authorize or relate to licensure, regulation, supervision, or control of, nor to be applicable to:
a. Private offices and private clinics of an individual physician, dentist, or other practitioner or group of health care providers, except as provided by section 135.61, subsection 18, paragraphs “g”, “h”, and “m”, and subsections 20 and 21.
b. Dispensaries and first aid stations, located within schools, businesses, or industrial establishments, which are maintained solely for the use of students or employees of those establishments and which do not contain inpatient or resident beds that are customarily occupied by the same individual for more than twenty-four consecutive hours.
c. Establishments such as motels, hotels, and boarding houses which provide medical, nursing personnel, and other health related services as an incident to their primary business or function.
d. The remedial care or treatment of residents or patients in any home or institution conducted only for those who rely solely upon treatment by prayer or spiritual means in accordance with the creed or tenets of any recognized church or religious denomination.
e. A health maintenance organization or combination of health maintenance organizations or an institutional health facility controlled directly or indirectly by a health maintenance organization or combination of health maintenance organizations, except when the health maintenance organization or combination of health maintenance organizations does any of the following:
(1) Constructs, develops, renovates, relocates, or otherwise establishes an institutional health facility.
(2) Acquires major medical equipment as provided by section 135.61, subsection 18, paragraphs “i” and “j”.
f. A residential care facility, as defined in section 135C.1, including a residential care facility for persons with mental retardation, notwithstanding any provision in this division to the contrary.
g. (1) A reduction in bed capacity of an institutional health facility, notwithstanding any provision in this division to the contrary, if all of the following conditions exist:
(a) The institutional health facility reports to the department the number and type of beds reduced on a form prescribed by the department at least thirty days before the reduction. In the case of a health care facility, the new bed total must be consistent with the number of licensed beds at the facility. In the case of a hospital, the number of beds must be consistent with bed totals reported to the department of inspections and appeals for purposes of licensure and certification.
(b) The institutional health facility reports the new bed total on its next annual report to the department.
(2) If these conditions are not met, the institutional health facility is subject to review as a “new institutional health service” or “changed institutional health service” under section 135.61, subsection 18, paragraph “d”, and subject to sanctions under section 135.73. If the institutional health facility reestablishes the deleted beds at a later time, review as a “new institutional health service” or “changed institutional health service” is required pursuant to section 135.61, subsection 18, paragraph “d”.
h. (1) The deletion of one or more health services, previously offered on a regular basis by an institutional health facility or health maintenance organization, notwithstanding any provision of this division to the contrary, if all of the following conditions exist:
(a) The institutional health facility or health maintenance organization reports to the department the deletion of the service or services at least thirty days before the deletion on a form prescribed by the department.
(b) The institutional health facility or health maintenance organization reports the deletion of the service or services on its next annual report to the department.
(2) If these conditions are not met, the institutional health facility or health maintenance organization is subject to review as a “new institutional health service” or “changed institutional health service” under section 135.61, subsection 18, paragraph “f”, and subject to sanctions under section 135.73.
(3) If the institutional health facility or health maintenance organization reestablishes the deleted service or services at a later time, review as a “new institutional health service” or “changed institutional health service” may be required pursuant to section 135.61, subsection 18.
i. A residential program exempt from licensing as a health care facility under chapter 135C in accordance with section 135C.6, subsection 8.
j. The construction, modification, or replacement of nonpatient care services, including parking facilities, heating, ventilation and air conditioning systems, computers, telephone systems, medical office buildings, and other projects of a similar nature, notwithstanding any provision in this division to the contrary.
k. (1) The redistribution of beds by a hospital within the acute care category of bed usage, notwithstanding any provision in this division to the contrary, if all of the following conditions exist:
(a) The hospital reports to the department the number and type of beds to be redistributed on a form prescribed by the department at least thirty days before the redistribution.
(b) The hospital reports the new distribution of beds on its next annual report to the department.
(2) If these conditions are not met, the redistribution of beds by the hospital is subject to review as a new institutional health service or changed institutional health service pursuant to section 135.61, subsection 18, paragraph “d”, and is subject to sanctions under section 135.73.
l. The replacement or modernization of any institutional health facility if the replacement or modernization does not add new health services or additional bed capacity for existing health services, notwithstanding any provision in this division to the contrary. With respect to a nursing facility, “replacement” means establishing a new facility within the same county as the prior facility to be closed. With reference to a hospital, “replacement” means establishing a new hospital that demonstrates compliance with all of the following criteria through evidence submitted to the department:
(1) Is designated as a critical access hospital pursuant to 42 U.S.C. § 1395i-4.
(2) Serves at least seventy-five percent of the same service area that was served by the prior hospital to be closed and replaced by the new hospital.
(3) Provides at least seventy-five percent of the same services that were provided by the prior hospital to be closed and replaced by the new hospital.
(4) Is staffed by at least seventy-five percent of the same staff, including medical staff, contracted staff, and employees, as constituted the staff of the prior hospital to be closed and replaced by the new hospital.
m. Hemodialysis services provided by a hospital or freestanding facility, notwithstanding any provision in this division to the contrary.
n. Hospice services provided by a hospital, notwithstanding any provision in this division to the contrary.
o. The change in ownership, licensure, organizational structure, or designation of the type of institutional health facility if the health services offered by the successor institutional health facility are unchanged. This exclusion is applicable only if the institutional health facility consents to the change in ownership, licensure, organizational structure, or designation of the type of institutional health facility and ceases offering the health services simultaneously with the initiation of the offering of health services by the successor institutional health facility.
p. The conversion of an existing number of beds by an intermediate care facility for persons with mental retardation to a smaller facility environment, including but not limited to a community-based environment which does not result in an increased number of beds, notwithstanding any provision in this division to the contrary, including subsection 4, if all of the following conditions exist:
(1) The intermediate care facility for persons with mental retardation reports the number and type of beds to be converted on a form prescribed by the department at least thirty days before the conversion.
(2) The intermediate care facility for persons with mental retardation reports the conversion of beds on its next annual report to the department.
3. This division shall not be construed to be applicable to a health care facility operated by and for the exclusive use of members of a religious order, which does not admit more than two individuals to the facility from the general public, and which was in operation prior to July 1, 1986. However, this division is applicable to such a facility if the facility is involved in the offering or developing of a new or changed institutional health service on or after July 1, 1986.
4. A copy of the application shall be sent to the department of human services at the time the application is submitted to the Iowa department of public health. The department shall not process applications for and the council shall not consider a new or changed institutional health service for an intermediate care facility for persons with mental retardation unless both of the following conditions are met:
a. The new or changed beds shall not result in an increase in the total number of medical assistance certified intermediate care facility beds for persons with mental retardation in the state, exclusive of those beds at the state resource centers or other state institutions, beyond one thousand six hundred thirty-six beds.
b. A letter of support for the application is provided by the county board of supervisors, or the board’s designee, in the county in which the beds would be located.
86 Acts, ch 1150, §1; 86 Acts, ch 1245, §1110; 91 Acts, ch 225, §4; 92 Acts, ch 1043, §1; 92 Acts, ch 1206, §1; 95 Acts, ch 120, §1; 96 Acts, ch 1129, §113; 97 Acts, ch 93, §4 – 8; 2002 Acts, ch 1120, §10; 2006 Acts, ch 1184, §78; 2008 Acts, ch 1191, §47; 2009 Acts, ch 184, §38
Referred to in
1. In determining whether a certificate of need shall be issued, the department shall consider the following:
a. The contribution of the proposed institutional health service in meeting the needs of the medically underserved, including persons in rural areas, low-income persons, racial and ethnic minorities, persons with disabilities, and the elderly, as well as the extent to which medically underserved residents in the applicant’s service area are likely to have access to the proposed institutional health service.
b. The relationship of the proposed institutional health services to the long-range development plan, if any, of the person providing or proposing the services.
c. The need of the population served or to be served by the proposed institutional health services for those services.
d. The distance, convenience, cost of transportation, and accessibility to health services for persons who live outside metropolitan areas.
e. The availability of alternative, less costly, or more effective methods of providing the proposed institutional health services.
f. The immediate and long-term financial feasibility of the proposal presented in the application, as well as the probable impact of the proposal on the costs of and charges for providing health services by the person proposing the new institutional health service.
g. The relationship of the proposed institutional health services to the existing health care system of the area in which those services are proposed to be provided.
h. The appropriate and efficient use or prospective use of the proposed institutional health service, and of any existing similar services, including but not limited to a consideration of the capacity of the sponsor’s facility to provide the proposed service, and possible sharing or cooperative arrangements among existing facilities and providers.
i. The availability of resources, including, but not limited to, health care providers, management personnel, and funds for capital and operating needs, to provide the proposed institutional health services and the possible alternative uses of those resources to provide other health services.
j. The appropriate and nondiscriminatory utilization of existing and available health care providers. Where both allopathic and osteopathic institutional health services exist, each application shall be considered in light of the availability and utilization of both allopathic and osteopathic facilities and services in order to protect the freedom of choice of consumers and health care providers.
k. The relationship, including the organizational relationship, of the proposed institutional health services to ancillary or support services.
l. Special needs and circumstances of those entities which provide a substantial portion of their services or resources, or both, to individuals not residing in the immediate geographic area in which the entities are located, which entities may include but are not limited to medical and other health professional schools, multidisciplinary clinics, and specialty centers.
m. The special needs and circumstances of health maintenance organizations.
n. The special needs and circumstances of biomedical and behavioral research projects designed to meet a national need and for which local conditions offer special advantages.
o. The impact of relocation of an institutional health facility or health maintenance organization on other institutional health facilities or health maintenance organizations and on the needs of the population to be served, or which was previously served, or both.
p. In the case of a construction project, the costs and methods of the proposed construction and the probable impact of the proposed construction project on total health care costs.
q. In the case of a proposal for the addition of beds to a health care facility, the consistency of the proposed addition with the plans of other agencies of this state responsible for provision and financing of long-term care services, including home health services.
r. The recommendations of staff personnel of the department assigned to the area of certificate of need, concerning the application.
2. In addition to the findings required with respect to any of the criteria listed in subsection 1 of this section, the department shall grant a certificate of need for a new institutional health service or changed institutional health service only if the department finds in writing, on the basis of data submitted, that:
a. Less costly, more efficient, or more appropriate alternatives to the proposed institutional health service are not available and the development of such alternatives is not practicable;
b. Any existing facilities providing institutional health services similar to those proposed are being used in an appropriate and efficient manner;
c. In the case of new construction, alternatives including but not limited to modernization or sharing arrangements have been considered and have been implemented to the maximum extent practicable;
d. Patients will experience serious problems in obtaining care of the type which will be furnished by the proposed new institutional health service or changed institutional health service, in the absence of that proposed new service.
3. In the evaluation of applications for certificates of need submitted by the university of Iowa hospitals and clinics, the unique features of that institution relating to statewide tertiary health care, health science education, and clinical research shall be given due consideration. Further, in administering this subchapter, the unique capacity of university hospitals for the evaluation of technologically innovative equipment and other new health services shall be utilized.
91 Acts, ch 225, §5; 92 Acts, ch 1043, §2; 96 Acts, ch 1129, §113; 2002 Acts, ch 1120, §11; 2014 Acts, ch 1026, §29; 2019 Acts, ch 24, §104; 2023 Acts, ch 19, §1443, 1602
C2024, §10A.714
C2026, §135.63
Section transferred from §10A.714 in Code 2026 pursuant to directive in
Subsection 1, unnumbered paragraph 1 amended
Subsection 1, paragraph r amended
Subsection 2, unnumbered paragraph 1 amended
Subsection 3 amended
Official source: Iowa Legislature. Reproduced from public-domain Iowa statutes; confirm against the official source for the current text. Not legal advice.