PURPOSE: This rule outlines the criteria and standards against which a project involving a health care facility would be evaluated relative to the financial feasibility of the project in a Certificate of Need (CON) review.

1. (1) Proposals for any new hospital, nursing home, residential care facility, or assisted living facility construction must include documentation that the proposed costs per square foot are reasonable when compared to the latest “RS Means Construction Cost Data” available from Certificate of Need Program (CONP). Any proposal with costs in excess of the three-fourths (3/4) percentile must include justification for the higher costs.
2. (2) Document that sufficient financing will be available to assure completion of the project by providing a letter from a financial institution saying it is willing to finance the project, or an auditor’s statement that unrestricted funds are available for the project.

3. (3) Document financial feasibility by including:

   1. (A) The Service-Specific Revenues and Expenses (Form MO 580-1865) for each revenue generating service affected by the project for the past three (3) years projected through three (3) years beyond project completion;
   2. (B) The Detailed Institutional Cash Flows (Form MO 580-1866) for the past three (3) years projected through three (3) years beyond project completion; and
   3. (C) For existing services, a copy of the latest available audited financial statements or the most recent Internal Revenue Service
4. (IRS) 990 Form or similar IRS filing for facilities not having individual audited financial statements.

5. (4) Show how the proposed service will be affordable to the population in the proposed service area:

   1. (A) Document how the proposal would impact current patient charges, and disclose the method for deriving charges for this service, including both direct and indirect components of the charge; and
   2. (B) Demonstrate that the proposed service will be responsive to the needs of the medically indigent through such mechanisms as fee waivers, reduced charges, sliding fee scales or structured payments.
6. (5) The most current version of Forms MO 580-1865 and MO 580-1866 may be obtained by mailing a written request to the CONP, PO Box 570, Jefferson City, MO 65102, or in person at the CONP Office, or, if technically feasible, by downloading a copy of the forms from the CONP website at www.dhss.mo.gov/con.

AUTHORITY: section 197.320, RSMo 2000.* Emergency rule filed Aug. 29, 1997, effective Sept. 8, 1997, expired March 6, 1998. Original rule filed Aug. 29, 1997, effective March 30, 1998. Amended: Filed Oct. 19, 1999, effective April 30, 2000. Emergency rescission and rule filed Dec. 14, 2001, effective Jan. 1, 2002, expired June 29, 2002. Rescinded and readopted: Filed Dec. 14, 2001, effective June 30, 2002. Emergency amendment filed Aug. 14, 2006, effective Aug. 28, 2006, expired Feb. 23, 2007. Amended: Filed Aug. 14, 2006, effective March 30, 2007. *Original authority: 197.320, RSMo 1979, amended 1993, 1995, 1999.