§ 2801-a. Establishment or incorporation of hospitals. 1. No hospital,
as defined in this article, shall be established except with the written
approval of the public health and health planning council. No
certificate of incorporation of a business membership or not-for-profit
corporation shall hereafter be filed which includes among its corporate
purposes or powers the establishment or operation of any hospital, as
defined in this article, or the solicitation of contributions for any
such purpose, or two or more of such purposes, except with the written
approval of the public health and health planning council, and when
otherwise required by law of a justice of the supreme court, endorsed on
or annexed to the certificate of incorporation. No articles of
organization of a limited liability company established pursuant to the
New York limited liability company law which includes among its powers
or purposes the establishment or operation of any hospital as defined in
this article, shall be filed with the department of state except upon
the approval of the public health and health planning council.

2. With respect to the incorporation or establishment of any hospital,
as defined in this article, the public health and health planning
council shall give written approval after all of the following
requirements have been met. An application for approval of the proposed
certificate of incorporation, articles of organization or establishment
shall be filed with the public health and health planning council
together with such other forms and information as shall be prescribed
by, or acceptable to, the public health and health planning council.
Thereafter, the public health and health planning council shall forward
a copy of the proposed certificate or application for establishment, and
accompanying documents, to the health systems agency, if any, having
geographical jurisdiction of the area where the proposed institution is
to be located. The public health and health planning council shall act
upon such application after the health systems agency has had a
reasonable time to submit their recommendations. At the time members of
the public health and health planning council are notified that an
application is scheduled for consideration, the applicant and the health
systems agency shall be so notified in writing. The public health and
health planning council shall afford the applicant an opportunity to
present information in person concerning the application to a committee
designated by the council. The public health and health planning council
shall not take any action contrary to the advice of the health systems
agency until it affords to the health systems agency an opportunity to
request a public hearing and, if so requested, a public hearing shall be
held. If the public health and health planning council proposes to
disapprove the application it shall afford the applicant an opportunity
to request a public hearing. The public health and health planning
council may hold a public hearing on the application on its own motion.
Any public hearing held pursuant to this subdivision may be conducted by
the public health and health planning council, or by any individual
designated by the public health and health planning council. Beginning
on January first, nineteen hundred ninety-four, and each year
thereafter, a complete application received between January first and
June thirtieth of each year shall be reviewed by the appropriate health
systems agency and the department and presented to the public health and
health planning council for its consideration prior to June thirtieth of
the following year and a complete application received between July
first and December thirty-first of each year shall be reviewed by the
appropriate health systems agency and the department presented to the
public health and health planning council for consideration prior to
December thirty-first of the following year.

2-a. (a) Notwithstanding any provision of law to the contrary, the
commissioner is authorized to approve a certificate of incorporation or
articles of organization for establishment of a hospital, provided that:
(i) the certificate of incorporation or articles of organization
reflects solely a change in the form of the business organization of an
existing entity which had been approved by the public health and health
planning council or its predecessor; and (ii) every incorporator,
stockholder, member, director and sponsor of the new entity shall have
been an owner, partner, incorporator, stockholder, member, director or
sponsor of the existing entity; and (iii) the distribution of ownership,
interests and voting rights in the new entity shall be the same as in
the existing entity; and (iv) there shall be no change in the operator
of a hospital other than the form of its business organization, as a
result of the approval of such certificate of incorporation or articles
of organization. Any approval by the public health and health planning
council of a person as an owner, incorporator, stockholder, member,
director or sponsor in the existing entity shall be deemed to be
approval for the same degree of participation in the new entity. If the
proposal is acceptable to the commissioner an amended operating
certificate shall be issued. In the event the commissioner determines
that the proposed transfer is not approvable the application shall be
referred to the public health and health planning council for its review
and action. If the public health and health planning council proposes to
disapprove the application, it shall afford the applicant an opportunity
to request a public hearing and, if so requested, a public hearing shall
be held. Any public hearing held pursuant to this subdivision may be
conducted by the public health and health planning council, or by any
individual designated by the public health and health planning council.

2-b. (a) This subdivision applies with respect to an application under
this section relating to the incorporation or establishment of any
nursing home, in addition to subdivision two of this section.

(b) The department shall provide notice, in writing or electronically,
of an application for establishment to the state office of long-term
care ombudsman, within thirty days of acknowledgement of the application
by the department. Thereafter, the state office of the long-term care
ombudsman shall submit its recommendation to the department and to the
public health and health planning council for consideration about such
application. At the time members of such council are notified that an
application is scheduled for consideration by a committee designated by
the public health and health planning council, the department shall also
notify the state office of the long-term care ombudsman, in writing or
electronically.

(c) In the case of an application for establishment relating to an
existing nursing home, the established operator and applicant shall
provide notice of the application, in writing or electronically, to
residents of the nursing home and their representatives and the staff of
the nursing home, including their union representatives, within thirty
days of acknowledgment of the application by the department. The
established operator and applicant shall also immediately notify
residents of the nursing home and their representatives and the staff of
the nursing home, including their union representatives, when the
established operator and applicant is notified that its application is
scheduled for consideration by a committee designated by the public
health and health planning council.

3. The public health and health planning council shall not approve a
certificate of incorporation, articles of organization or application
for establishment unless it is satisfied, insofar as applicable, as to
(a) the public need for the existence of the institution at the time and
place and under the circumstances proposed, provided, however, that in
the case of an institution proposed to be established or operated by an
organization defined in subdivision one of section one hundred
seventy-two-a of the executive law, the needs of the members of the
religious denomination concerned, for care or treatment in accordance
with their religious or ethical convictions, shall be deemed to be
public need; (b) the character, competence, and standing in the
community, of the proposed incorporators, directors, sponsors,
stockholders, members or operators; with respect to any proposed
incorporator, director, sponsor, stockholder, member or operator who is
already or within the past ten years has been an incorporator, director,
sponsor, member, principal stockholder, principal member, or operator of
any hospital, private proprietary home for adults, residence for adults,
or non-profit home for the aged or blind which has been issued an
operating certificate by the state department of social services, or a
halfway house, hostel or other residential facility or institution for
the care, custody or treatment of the mentally disabled which is subject
to approval by the department of mental hygiene, no approval shall be
granted unless the public health and health planning council, having
afforded an adequate opportunity to members of health systems agencies,
if any, having geographical jurisdiction of the area where the
institution is to be located to be heard, shall affirmatively find by
substantial evidence as to each such incorporator, director, sponsor,
principal stockholder or operator that a substantially consistent high
level of care is being or was being rendered in each such hospital,
home, residence, halfway house, hostel, or other residential facility or
institution with which such person is or was affiliated; for the
purposes of this paragraph, the public health and health planning
council shall adopt rules and regulations, subject to the approval of
the commissioner, to establish the criteria to be used to determine
whether a substantially consistent high level of care has been rendered,
provided, however, that there shall not be a finding that a
substantially consistent high level of care has been rendered where
there have been violations of the state hospital code, or other
applicable rules and regulations, that (i) threatened to directly affect
the health, safety or welfare of any patient or resident, and (ii) were
recurrent or were not promptly corrected; (c) the financial resources of
the proposed institution and its sources of future revenues; and (d)
such other matters as it shall deem pertinent.

3-a. Notwithstanding any other provisions of this chapter, the public
health council is hereby empowered to approve the establishment, for
demonstration purposes, of not more than one existing hospital within
the geographical jurisdiction of each health systems agency established
under the provisions of subdivision (c) of section twenty-nine hundred
four of this chapter. The purposes of such hospitals shall be to offer
and provide nursing home services, board and lodging to persons
requiring such services within one hospital. The public health council
may approve the establishment of such hospitals without regard to the
requirement of public need as set forth in subdivision three of this
section.

3-b. (a) This subdivision applies to an application under this section
relating to a nursing home, and applies in addition to subdivision three
of this section.

(b) The application shall provide information as to the character,
competence and standing in the community of every individual and entity
of the applicant and specify the identity of every nursing home in which
each of those individuals and entities is, or in the preceding seven
years has held a controlling interest or has been a controlling person,
principal stockholder or principal member; and the nature of that
interest. As used in this subdivision, "individual and entity of the
applicant" shall include but not be limited to an individual or entity
that is a controlling person, principal stockholder, or principal member
of the applicant. The council shall not approve the application unless
it finds that each individual and entity, in relation to ownership of a
nursing home located in the United States, for at least the previous
seven years, demonstrated satisfactory character, competence and
standing in the community and the nursing home provided a consistently
high level of care. The council shall adopt rules and regulations,
subject to the approval of the commissioner, to establish the criteria
to be used to determine whether a consistently high level of care has or
has not been rendered by an applicant at such nursing home. The council
shall consider, at a minimum, the following occurrences to determine
whether a consistently high level of care has been delivered at a
facility, and shall require the applicant to disclose and provide an
explanation for any of the following occurrences: (i) a facility that
has earned a two-star rating or less by the federal centers for Medicare
and Medicaid Services (CMS) (or a comparable rating under a successor
CMS rating system);(ii) where there have been violations of the state or
federal nursing home code, or other applicable rules and regulations,
that threatened to directly affect the health, safety or welfare of any
patient or resident, including but not limited to a finding of immediate
jeopardy, or actual harm, and were recurrent or were not promptly
corrected, including but not limited to repeat deficiencies for the same
or similar violations over a three year period or during the entire
duration of ownership if less than three years, or any facility which
has been in receivership; (iii) where a facility has closed as a result
of a settlement agreement from a decertification action or licensure
revocation; or (iv) has been involuntarily terminated from the Medicare
or Medicaid program in the prior five years, provided however, that
where an applicant has taken over a facility and promptly corrected such
deficiencies, the council may consider the application.

4. (a) Any change in the person who is the operator of a hospital
shall be approved by the public health and health planning council in
accordance with the provisions of subdivisions two and three of this
section. Notwithstanding any inconsistent provision of this paragraph,
any change by a natural person who is the operator of a hospital seeking
to transfer part of his or her interest in such hospital to another
person or persons so as to create a partnership shall be approved in
accordance with the provisions of paragraph (b) of this subdivision.

(b) (i) Any transfer, assignment or other disposition of ten percent
or more of an interest or voting rights in a partnership or limited
liability company, which is the operator of a hospital to a new partner
or member, shall be approved by the public health and health planning
council, in accordance with the provisions of subdivisions two and three
of this section, except that: (A) any such change shall be subject to
the approval by the public health and health planning council in
accordance with paragraph (b) of subdivision three of this section only
with respect to the new partner or member, and any remaining partners or
members who have not been previously approved for that facility in
accordance with such paragraph, and (B) such change shall not be subject
to paragraph (a) of subdivision three of this section.

(ii) With respect to a transfer, assignment or disposition involving
less than ten percent of an interest or voting rights in such
partnership or limited liability company to a new partner or member, no
prior approval of the public health and health planning council shall be
required. However, no such transaction shall be effective unless at
least ninety days prior to the intended effective date thereof, the
partnership or limited liability company fully completes and files with
the public health and health planning council notice on a form, to be
developed by the public health and health planning council, which shall
disclose such information as may reasonably be necessary for the public
health and health planning council to determine whether it should bar
the transaction for any of the reasons set forth in item (A), (B), (C)
or (D) below. Within ninety days from the date of receipt of such
notice, the public health and health planning council may bar any
transaction under this subparagraph: (A) if the equity position of the
partnership or limited liability company, determined in accordance with
generally accepted accounting principles, would be reduced as a result
of the transfer, assignment or disposition; (B) if the transaction would
result in the ownership of a partnership or membership interest by any
persons who have been convicted of a felony described in subdivision
five of section twenty-eight hundred six of this article; (C) if there
are reasonable grounds to believe that the proposed transaction does not
satisfy the character and competence criteria set forth in subdivision
three of this section; or (D) if the transaction, together with all
transactions under this subparagraph for the partnership, or successor,
during any five year period would, in the aggregate, involve twenty-five
percent or more of the interest in the partnership. The public health
and health planning council shall state specific reasons for barring any
transaction under this subparagraph and shall so notify each party to
the proposed transaction.

(iii) With respect to a transfer, assignment or disposition of an
interest or voting rights in such partnership or limited liability
company to any remaining partner or member, which transaction involves
the withdrawal of the transferor from the partnership or limited
liability company, no prior approval of the public health and health
planning council shall be required. However, no such transaction shall
be effective unless at least ninety days prior to the intended effective
date thereof, the partnership or limited liability company fully
completes and files with the public health and health planning council
notice on a form, to be developed by the public health and health
planning council, which shall disclose such information as may
reasonably be necessary for the public health and health planning
council to determine whether it should bar the transaction for the
reason set forth below. Within ninety days from the date of receipt of
such notice, the public health and health planning council may bar any
transaction under this subparagraph if the equity position of the
partnership or limited liability company, determined in accordance with
generally accepted accounting principles, would be reduced as a result
of the transfer, assignment or disposition. The public health and health
planning council shall state specific reasons for barring any
transaction under this subparagraph and shall so notify each party to
the proposed transaction.

(c) Any transfer, assignment or other disposition of ten percent or
more of the stock or voting rights thereunder of a corporation which is
the operator of a hospital or which is a member of a limited liability
company which is the operator of a hospital to a new stockholder, or any
transfer, assignment or other disposition of the stock or voting rights
thereunder of such a corporation which results in the ownership or
control of more than ten percent of the stock or voting rights
thereunder of such corporation by any person not previously approved by
the public health and health planning council, or its predecessor, for
that corporation shall be subject to approval by the public health and
health planning council, in accordance with the provisions of
subdivisions two and three of this section and rules and regulations
pursuant thereto; except that: any such transaction shall be subject to
the approval by the public health and health planning council in
accordance with paragraph (b) of subdivision three of this section only
with respect to a new stockholder or a new principal stockholder; and
shall not be subject to paragraph (a) of subdivision three of this
section. In the absence of such approval, the operating certificate of
such hospital shall be subject to revocation or suspension. No prior
approval of the public health and health planning council shall be
required with respect to a transfer, assignment or disposition of ten
percent or more of the stock or voting rights thereunder of a
corporation which is the operator of a hospital or which is a member of
a limited liability company which is the owner of a hospital to any
person previously approved by the public health and health planning
council, or its predecessor, for that corporation. However, no such
transaction shall be effective unless at least ninety days prior to the
intended effective date thereof, the stockholder completes and files
with the public health and health planning council notice on forms to be
developed by the public health and health planning council, which shall
disclose such information as may reasonably be necessary for the public
health and health planning council to determine whether it should bar
the transaction. Such transaction will be final as of the intended
effective date unless, prior thereto, the public health and health
planning council shall state specific reasons for barring such
transactions under this paragraph and shall notify each party to the
proposed transaction. Nothing in this paragraph shall be construed as
permitting a person not previously approved by the public health and
health planning council for that corporation to become the owner of ten
percent or more of the stock of a corporation which is the operator of a
hospital or which is a member of a limited liability company which is
the owner of a hospital without first obtaining the approval of the
public health and health planning council.

(d) No hospital shall be approved for establishment which would be
operated by a limited partnership, or by a partnership any of the
members of which are not natural persons.

(e) No hospital shall be approved for establishment which would be
operated by a corporation any of the stock of which is owned by another
corporation or a limited liability company if any of its corporate
members' stock is owned by another corporation.

(f) No corporation shall be a member of a limited liability company
authorized to operate a hospital unless its proposed incorporators,
directors, stockholders or principal stockholders shall have been
approved in accordance with the provisions of subdivision three of this
section applicable to the approval of the proposed incorporators,
directors or stockholders of any other corporation requiring approval
for establishment.

(g) A natural person appointed as trustee of an express testamentary
trust, created by a deceased sole proprietor, partner or shareholder in
the operation of a hospital for the benefit of a person of less than
twenty-five years of age, may, as the trustee, apply pursuant to
subdivision two of this section for approval to operate or participate
in the operation of a facility or interest therein which is included in
the corpus of such trust until such time as all beneficiaries attain the
age of twenty-five, unless the trust instrument provides for earlier
termination, or such beneficiaries receive establishment approval in
their own right, or until a transfer of the trust corpus is approved by
the public health and health planning council, in accordance with this
subdivision and subdivisions two and three of this section, whichever
first occurs. The public health and health planning council shall not
approve any such application unless it is satisfied as to:

(i) the character, competence and standing in the community of each
proposed trustee operator pursuant to the provisions of paragraph (b) of
subdivision three of this section; and

(ii) the ability of the trustee under the terms of the trust
instrument to operate or participate in the operation of the hospital in
a manner consistent with this chapter and regulations promulgated
pursuant thereto.

(h) A natural person appointed conservator pursuant to article
eighty-one of the mental hygiene law, or a natural person appointed
committee of the property of an incompetent pursuant to article
eighty-one of the mental hygiene law or a sole proprietor, partner or
shareholder of a hospital, may apply pursuant to subdivision two of this
section for approval to operate a hospital owned by the conservatee or
incompetent for a period not exceeding two years or until a transfer of
the hospital is approved by the public health and health planning
council in accordance with subdivisions two and three of this section,
whichever occurs first. The public health and health planning council
shall not approve any such application unless it is satisfied as to:

(i) the character, competence and standing in the community of the
proposed conservator operator or committee operator pursuant to the
provisions of paragraph (b) of subdivision three of this section; and

(ii) the ability of the conservator or committee under the terms of
the court order to operate the hospital in a manner consistent with this
chapter and regulations promulgated pursuant thereto.

(i) Upon recommendation by the commissioner, if the public health and
health planning council finds by substantial evidence that an improper
delegation of management authority by a governing authority or operator
of a general hospital has occurred as defined by paragraph (g) of
subdivision one of section twenty-eight hundred six-a of this article,
the establishment approval of such hospital shall be subject to
revocation or suspension.

5. Except as otherwise hereinafter provided, no county, city, town,
village or other governmental subdivision shall establish or create any
agency concerned with the establishment of any hospital as defined in
this article without securing the written approval of the public health
and health planning council in accordance with the requirements and
procedures of subdivisions two and three of this section with respect to
certificates of incorporation, articles of organization and
establishment, except that the requirements relating to the proposed
incorporators, directors and sponsors shall not apply. The preceding
shall not apply to the establishment of state hospitals by the state of
New York or to the establishment of municipal hospitals by the city of
New York.

6. No corporation having power to solicit contributions for charitable
purposes shall be deemed to have authority to solicit contributions for
any purpose for which the approval of the public health and health
planning council is required, unless the certificate of incorporation
specifically makes provision therefor, and the written approval of the
public health and health planning council, or its predecessor is
endorsed on or annexed to such certificate.

7. Where such approval has not been obtained the public health and
health planning council may institute and maintain an action in the
supreme court through the attorney general to procure a judgment
dissolving and vacating or annulling the certificate of incorporation of

(a) any such corporation, or

(b) any corporation hereafter incorporated, the name, purposes,
objects or the activities of which in any manner may lead to the belief
that the corporation possesses or may exercise any of such purposes.

8. No corporation heretofore formed, having among its powers the power
to solicit contributions for charitable purposes, may solicit or
continue to solicit contributions for a purpose for which the approval
of the public health and health planning council is required without the
written approval of the public health and health planning council,
except: (a) a corporation which, prior to June first, nineteen hundred
seventy, had received the approval of the state board of social welfare
of a certificate of incorporation containing such power; or (b) a
corporation, which prior to December first, two thousand ten, had
received the approval of the public health council of a certificate of
incorporation containing such power. If such approval is not obtained
and the corporation continues to solicit or to receive contributions for
such purpose or advertises that it has obtained such approval, the
public health and health planning council may institute and maintain an
action in the supreme court through the attorney general to procure a
judgment dissolving and vacating or annulling the certificate of
incorporation of any such corporation.

9. Only a natural person, a partnership or limited liability company
may hereafter undertake to engage in the business of operating or
conducting a hospital, as defined in this article, for profit, except
that: (a) a person, partnership or corporation which owned and was
operating a hospital on April fourth, nineteen hundred fifty-six, may
continue to own and operate such hospital; (b) a business corporation
may, with the approval of the public health council, and in accordance
with the provisions of subdivisions two and three of this section,
undertake to engage in the business of operating or conducting a
hospital, as defined in this article for profit, provided that such
corporation shall not discriminate because of race, color, creed,
national origin or sponsor in admission or retention of patients; (c) a
business corporation owning and operating a nursing home on May
twenty-second, nineteen hundred sixty-nine, in accordance with
applicable provisions of law, may continue to own and operate such
nursing home; (d) a person who, or a partnership which, is operating a
private proprietary nursing home in accordance with applicable
provisions of law may, with the approval of the public health and health
planning council, and in accordance with the provisions of subdivision
three of this section and any rules and regulations thereunder form a
business corporation to engage in the business of operating or
conducting such nursing home, provided, however, that such corporation
shall not discriminate because of race, color, creed, national origin or
sponsor in admission or retention of patients; (e) a business
corporation operating a nursing home, which corporation was formed with
the approval of the state board of social welfare, may continue to own
and operate such nursing home.

10. (a) The public health and health planning council, by a majority
vote of its members, shall adopt and amend rules and regulations, to
effectuate the provisions and purposes of this section, and to provide
for the revocation, limitation or annulment of approvals of
establishment.

(b) (i) No approval of establishment shall be revoked, limited or
annulled without first offering the person who received such approval
the opportunity of requesting a public hearing. (ii) The commissioner,
at the request of the public health and health planning council, shall
fix a time and place for any such hearing requested. (iii) Notice of the
time and place of the hearing shall be served in person or mailed by
registered mail to the person who has received establishment approval at
least twenty-one days before the date fixed for the hearing. (iv) Such
person shall file with the department, not less than eight days prior to
the hearing, a written answer. (v) All orders or determinations
hereunder shall be subject to review as provided in article
seventy-eight of the civil practice law and rules. Application for such
review must be made within sixty days after service in person or by
registered mail of a copy of such order or determination.

11. Any person filing a proposed certificate of incorporation,
articles of organization or an application for establishment of a
residential health care facility for approval of the public health and
health planning council shall file with the commissioner such
information as may be prescribed by regulation, including, but not
limited to, the following:

(a) The name and address and a description of the interest held by
each of the following persons:

(i) any person, who directly or indirectly, beneficially owns any
interest in the land on which the facility is located;

(ii) any person who, directly or indirectly, beneficially owns any
interest in the building in which the facility is located;

(iii) any person who, directly or indirectly, beneficially owns any
interest in any mortgage, note, deed of trust or other obligation
secured in whole or in part by the land on which or building in which
the facility is located; and

(iv) any person who, directly or indirectly, has any interest as
lessor or lessee in any lease or sub-lease of the land on which or the
building in which the facility is located.

(b) If any person named in response to paragraph (a) of this
subdivision is a partnership or limited liability company, then the name
and address of each partner or member.

(c) If any person named in response to paragraph (a) of this
subdivision is a corporation, other than a corporation whose shares are
traded on a national securities exchange or are regularly quoted in an
over-the-counter market or which is a commercial bank, savings bank or
savings and loan association, then the name and address of each officer,
director, stockholder and, if known, each principal stockholder and
controlling person of such corporation.

(d) If any corporation named in response to paragraph (a) of this
subdivision is a corporation whose shares are traded on a national
securities exchange or are regularly quoted in an over-the-counter
market or which is a commercial bank, savings bank or savings and loan
association, then the name and address of the principal executive
officers and each director and, if known, each principal stockholder of
such corporation.

* (e) Information pertaining to staffing, the source of staffing, and
staff skill mix.

* NB Effective October 21, 2021

12. The following definitions shall be applicable to this section:

(a) "Controlling person" of any corporation, partnership, limited
liability company or other entity means any person who by reason of a
direct or indirect ownership interest (whether of record or beneficial)
has the ability, acting either alone or in concert with others with
ownership or membership interests, to direct or cause the direction of
the management or policies of said corporation, partnership, limited
liability company or other entity. Neither the commissioner nor any
employee of the department nor any member of a local legislative body of
a county or municipality, nor any county or municipal official except
when acting as the administrator of a residential health care facility,
shall, by reason of his or her official position, be deemed a
controlling person of any corporation, partnership, limited liability
company or other entity, nor shall any person who serves as an officer,
administrator or other employee of any corporation, partnership, limited
liability company or other entity or as a member of a board of directors
or trustees of any corporation be deemed to be a controlling person of
such corporation, partnership, limited liability company or other entity
as a result of such position or his or her official actions in such
position.

(b) "Principal stockholder" of a corporation means any person who
beneficially owns, holds or has the power to vote, ten percent or more
of any class of securities issued by said corporation.

(c) "Principal member" of a limited liability company means any person
who beneficially owns, holds or has the power to vote, ten percent or
more interest determined by such member's share in the current profits
of the limited liability company.

13. Any person who operates a hospital without the written approval of
the public health and health planning council shall be liable to the
people of the state for a civil penalty not to exceed ten thousand
dollars for every such violation.

14. (a) The public health and health planning council may approve the
establishment of not-for-profit rural health networks as defined in
article twenty-nine-A of this chapter, pursuant to the provisions of
subdivisions two and three of this section, except that the public
health and health planning council shall not consider the public need
for and financial resources and sources of future revenues of such
networks which do not seek approval to operate a hospital. In addition
to character and competence, the public health and health planning
council may take into consideration available network plans.

(b) The board of directors or trustees of a not-for-profit rural
health network shall be comprised of a representative or representatives
of participating providers and members of the general public residing in
the area served by such network.

15. (a) Diagnostic or treatment centers established exclusively to
provide end stage renal disease services may be operated by corporations
and limited liability companies formed under the laws of New York whose
stockholders or members, as applicable, are not natural persons if such
corporations and limited liability companies and its principal
stockholders and members, as applicable, and controlling persons comply
with all applicable requirements of this section and demonstrate, to the
satisfaction of the public health and health planning council,
sufficient experience and expertise in delivering high quality end stage
renal disease care. For purposes of this subdivision, the public health
and health planning council shall adopt and amend rules and regulations,
notwithstanding any inconsistent provision of this section, to address
any matter it deems pertinent to the establishment and operation of
diagnostic or treatment centers pursuant to this subdivision; provided
that such rules and regulations shall include, but not be limited to
provisions governing or relating to: (i) any direct or indirect changes
or transfers of ownership interests or voting rights in such
corporations and limited liability companies or their stockholders or
members, as applicable, and provide for public health and health
planning council approval of any change in controlling interests,
principal stockholders, principal members, controlling persons, parent
company or sponsors; (ii) oversight of the operator and its stockholders
or members, as applicable, including local governance of the diagnostic
or treatment centers; and (iii) relating to the character and competence
and qualifications of, and changes relating to, the directors, managers
and officers of the operator and its principal stockholders, principal
members, controlling persons, parent company or sponsors.

(b) The following provisions of this section shall not apply to
diagnostic or treatment centers operated pursuant to this subdivision:
(i) paragraph (b) of subdivision three of this section, relating to
stockholders and members; (ii) paragraph (c) of subdivision four of this
section, relating to the disposition of stock or voting rights; and
(iii) paragraph (e) of subdivision four of this section, relating to the
ownership of stock or membership.

16. (a) The commissioner shall charge to applicants for the
establishment of hospitals the following application fee:

(i) For general hospitals: $3,000

(ii) For nursing homes: $3,000

(iii) For safety net diagnostic and treatment centers

as defined in paragraph (c) of this subdivision: $1,000

(iv) For all other diagnostic and treatment centers: $2,000

(b) An applicant for both establishment and construction of a hospital
shall not be subject to this subdivision and shall be subject to fees
and charges as set forth in section twenty-eight hundred two of this
article.

(c) The commissioner may designate a diagnostic and treatment center
or proposed diagnostic and treatment center as a "safety net diagnostic
and treatment center" if it is operated or proposes to be operated by a
not-for-profit corporation or local health department; participates or
intends to participate in the medical assistance program; demonstrates
or projects that a significant percentage of its visits, as determined
by the commissioner, were by uninsured individuals; and principally
provides primary care services as defined by the commissioner.

(d) The fees and charges paid by an applicant pursuant to this
subdivision for any application for establishment of a hospital approved
in accordance with this section shall be deemed allowable capital costs
in the determination of reimbursement rates established pursuant to this
article. The cost of such fees and charges shall not be subject to
reimbursement ceiling or other penalties used by the commissioner for
the purpose of establishing reimbursement rates pursuant to this
article. All fees pursuant to this section shall be payable to the
department of health for deposit into the special revenue funds - other,
miscellaneous special revenue fund - 339, certificate of need account.

* 17. (a) Diagnostic or treatment centers or other facilities managed
and administered by a local health department for the purpose of
providing limited health care services as defined by the commissioner
may be operated by a local health department. Such facilities shall be
referred to in this subdivision as "municipal limited health care
service facilities".

(b) The commissioner shall promulgate regulations for municipal
limited health care service facilities, which may be different from the
regulations otherwise applicable to hospitals, including, but not
limited to: designating or limiting the diagnoses and services that may
be provided; employee health requirements; and requirements or
guidelines for advertising and signage, disclosure of ownership
interests, informed consent, record keeping, referral for treatment,
case reporting to the patient's primary care or other health care
providers, design, construction, fixtures, and equipment.

* NB Effective December 22, 2025