§ 23-17.14-6 Initial application –Conversions involving for-profit corporations or not-for-profit as acquirors.– (a) No person shall engage in a conversion with a for profit corporation as theacquiror and a not-for-profit corporation as the acquiree involving theestablishment, maintenance, or operation of a hospital or a conversion subjectto § 23-17.14-9 without prior approval of both the department of attorneygeneral and the department of health. The transacting parties shall file aninitial application in accordance with subsection (b) of this section thatshall, at minimum, include the following information with respect to eachtransacting party and to the proposed new hospital:
(1) A detailed summary of the proposed conversion;
(2) Names, addresses and phone numbers of the transactingparties;
(3) Name, address, phone number, occupation, and tenure ofall officers, members of the board of directors, trustees, executives, andsenior level managers, including for each position, current persons and personsholding position during the past three (3) years;
(4) A list of all committees, subcommittees, task forces, orsimilar entities of the board of directors or trustees, including a shortdescription of the purpose of each committee, subcommittee, task force, orsimilar entity and the name, address, phone number, occupation, and tenure ofeach member;
(5) Agenda, meeting packages, and minutes of all meetings ofthe board of directors or trustees and any of its committees, subcommittees,task forces, or similar entities that occurred within the two (2) year periodprior to submission of the application;
(6) Articles of incorporation and certificate ofincorporation;
(7) Bylaws and organizational charts;
(8) Organizational structure for existing transacting partiesand each partner, affiliate, parent, subsidiary or related corporate entity inwhich the acquiror has a twenty percent (20%) or greater ownership interest;
(9) Conflict of interest statements, policies and procedures;
(10) Names, addresses and phone numbers of professionalconsultants engaged in connection with the proposed conversion;
(11) Copies of audited income statements, balance sheets,other financial statements, and management letters for the past three (3) yearsand to the extent they have been made public, audited interim financialstatements and income statements together with detailed description of thefinancing structure of the proposed conversion including equity contribution,debt restructuring, stock issuance, partnership interests, stock offerings andthe like;
(12) A detailed description of real estate issues includingtitle reports for land owned and lease agreements concerning the proposedconversion;
(13) A detailed description as each relates to the proposedtransaction for equipment leases, insurance, regulatory compliance, tax status,pending litigation or pending regulatory citations, pension plan descriptionsand employee benefits, environmental reports, assessments and organizationalgoals;
(14) Copies of reports analyzing the proposed conversionduring the past three (3) years including, but not limited to, reports byappraisers, accountants, investment bankers, actuaries and other experts;
(15) Copies of any opinions or memoranda addressing the stateand federal tax consequences of the proposed conversion prepared for atransacting party by an attorney, accountant, or other expert;
(16) A description of the manner in which the price wasdetermined including which methods of valuation and what data were used, andthe names and addresses of persons preparing the documents, and thisinformation is deemed to be proprietary;
(17) Patient statistics for the past three (3) years andpatient projections for the next one year including patient visits, admissions,emergency room visits, clinical visits, and visits to each department of thehospital, admissions to nursing care or visits by affiliated home health careentities;
(18) The name and mailing address of all licensed facilitiesin which the for-profit corporation maintains an ownership interest orcontrolling interest or operating authority;
(19) A list of pending or adjudicated citations, violationsor charges against the facilities listed in subdivision (a)(18) brought by anygovernmental agency or accrediting agency within the past three (3) years andthe status or disposition of each matter with regard to patient care andcharitable asset matters;
(20) A list of uncompensated care provided over the pastthree (3) years by each facility listed in subdivision (a)(18) and detail as tohow that amount was calculated;
(21) Copies of all documents related to:
(i) Identification of all charitable assets
(ii) Accounting of all charitable assets for the past three(3) years; and
(iii) Distribution of the charitable assets including, butnot limited to, endowments, restricted, unrestricted and specific purpose fundsas each relates to the proposed transaction;
(22) A description of charity care and uncompensated careprovided by the existing hospital for the previous five (5) year period to thepresent including a dollar amount and a description of services provided topatients;
(23) A description of bad debt incurred by the existinghospital for the previous five (5) years for which payment was anticipated butnot received;
(24) A description of the plan as to how the new hospitalwill provide community benefit and charity care during the first five (5) yearsof operation;
(25) A description of how the new hospital will monitor andvalue charity care services and community benefit;
(26) The names of persons currently holding a position as anofficer, director, board member, or senior level management who will or willnot maintain any position with the new hospital and whether any said personwill receive any salary, severance stock offering or any financial gain,current or deferred, as a result of or in relation to the proposed conversion;
(27) Copies of capital and operating budgets or otherfinancial projections for the new hospital during the first three (3) years ofoperation;
(28) Copies of plans relative to staffing during the firstthree (3) years at the new hospital;
(29) A list of all medical services, departments and clinicalservices, and administrative services which will be maintained at the newhospital;
(30) A description of criteria established by the board ofdirectors of the existing hospital for pursuing a proposed conversion with oneor more health care providers;
(31) Copies of reports of any due diligence review performedby each transacting party in relation to the proposed conversion. These reportsare to be held by the attorney general and department of health as confidentialand not released to the public regardless of any determination made pursuant to§ 23-17.14-32 and not withstanding any other provision of the general laws;
(32) A description of request for proposals issued by theexisting hospital relating to pursuing a proposed conversion;
(33) Copies of reports analyzing affiliations, mergers, orother similar transactions considered by any of the transacting parties duringthe past three (3) years, including, but not limited to, reports by appraisers,accountants, investment bankers, actuaries and other experts;
(34) A copy of proposed contracts or description of proposedcontracts or arrangements with management, board members, officers, ordirectors of the existing hospital for severance consulting services orcovenants not to compete following completion of the proposed conversion;
(35) A copy or description of all agreements or proposedagreements reflecting any current and/or future employment or compensatedrelationship between the acquiror (or any related entity) and any officer,director, board member, or senior level manager of the acquiree (or any relatedentity);
(36) A copy or description of all agreements executed oranticipated to be executed by any of the transacting parties in connection withthe proposed conversion;
(37) Copies of documents or description of any proposed planfor any entity to be created for charitable assets, including but not limitedto, endowments, restricted, unrestricted and specific purpose funds, theproposed articles of incorporation, by-laws, mission statement, program agenda,method of appointment of board members, qualifications of board members, dutiesof board members, and conflict of interest policies;
(38) Description of all departments, clinical, social, orother services or medical services that will be eliminated or significantlyreduced at the new hospital;
(39) Description of staffing levels of all categories ofemployees, including full-time, part-time, and contract employees currentlyworking at or providing services to the existing hospital and description ofany anticipated or proposed changes in current staffing levels;
(40) Current, signed original conflict of interest forms fromall incumbent or recently incumbent officers, directors, members of the board,trustees, senior management, chairpersons or department chairpersons andmedical directors on a form acceptable to the attorney general; "incumbent orrecently incumbent" means those individuals holding the position at the timethe application is submitted and any individual who held a similar positionwithin one year prior to the application's acceptance;
(41) If the acquiror is a for profit corporation that hasacquired a not for profit hospital under the provisions of this chapter, theapplication shall also include a complete statement of performance during thepreceding one year with regard to the terms and conditions of approval ofconversion and each projection, plan, or description submitted as part of theapplication for any conversion completed under an application submittedpursuant to this section and made a part of an approval for the conversionpursuant to § 23-17.14-7 or 23-17.14-8;
(42) Copies of IRS Form 990 for any transacting partyrequired by federal law to file such a form for each of the five (5) yearsprior to the submission of the application.
(b) Two (2) copies of the initial application shall beprovided to each of the department of health and department of the attorneygeneral simultaneously by United States mail, certified, return receiptrequested.
(c) Except for information determined by the attorney generalin accordance with § 23-17.14-32 to be confidential and/or proprietary, orotherwise required by law to be maintained as confidential, the initialapplication and supporting documentation shall be considered public records andshall be available for inspection upon request.
§ 23-17.14-6 Initial application –Conversions involving for-profit corporations or not-for-profit as acquirors.– (a) No person shall engage in a conversion with a for profit corporation as theacquiror and a not-for-profit corporation as the acquiree involving theestablishment, maintenance, or operation of a hospital or a conversion subjectto § 23-17.14-9 without prior approval of both the department of attorneygeneral and the department of health. The transacting parties shall file aninitial application in accordance with subsection (b) of this section thatshall, at minimum, include the following information with respect to eachtransacting party and to the proposed new hospital:
(1) A detailed summary of the proposed conversion;
(2) Names, addresses and phone numbers of the transactingparties;
(3) Name, address, phone number, occupation, and tenure ofall officers, members of the board of directors, trustees, executives, andsenior level managers, including for each position, current persons and personsholding position during the past three (3) years;
(4) A list of all committees, subcommittees, task forces, orsimilar entities of the board of directors or trustees, including a shortdescription of the purpose of each committee, subcommittee, task force, orsimilar entity and the name, address, phone number, occupation, and tenure ofeach member;
(5) Agenda, meeting packages, and minutes of all meetings ofthe board of directors or trustees and any of its committees, subcommittees,task forces, or similar entities that occurred within the two (2) year periodprior to submission of the application;
(6) Articles of incorporation and certificate ofincorporation;
(7) Bylaws and organizational charts;
(8) Organizational structure for existing transacting partiesand each partner, affiliate, parent, subsidiary or related corporate entity inwhich the acquiror has a twenty percent (20%) or greater ownership interest;
(9) Conflict of interest statements, policies and procedures;
(10) Names, addresses and phone numbers of professionalconsultants engaged in connection with the proposed conversion;
(11) Copies of audited income statements, balance sheets,other financial statements, and management letters for the past three (3) yearsand to the extent they have been made public, audited interim financialstatements and income statements together with detailed description of thefinancing structure of the proposed conversion including equity contribution,debt restructuring, stock issuance, partnership interests, stock offerings andthe like;
(12) A detailed description of real estate issues includingtitle reports for land owned and lease agreements concerning the proposedconversion;
(13) A detailed description as each relates to the proposedtransaction for equipment leases, insurance, regulatory compliance, tax status,pending litigation or pending regulatory citations, pension plan descriptionsand employee benefits, environmental reports, assessments and organizationalgoals;
(14) Copies of reports analyzing the proposed conversionduring the past three (3) years including, but not limited to, reports byappraisers, accountants, investment bankers, actuaries and other experts;
(15) Copies of any opinions or memoranda addressing the stateand federal tax consequences of the proposed conversion prepared for atransacting party by an attorney, accountant, or other expert;
(16) A description of the manner in which the price wasdetermined including which methods of valuation and what data were used, andthe names and addresses of persons preparing the documents, and thisinformation is deemed to be proprietary;
(17) Patient statistics for the past three (3) years andpatient projections for the next one year including patient visits, admissions,emergency room visits, clinical visits, and visits to each department of thehospital, admissions to nursing care or visits by affiliated home health careentities;
(18) The name and mailing address of all licensed facilitiesin which the for-profit corporation maintains an ownership interest orcontrolling interest or operating authority;
(19) A list of pending or adjudicated citations, violationsor charges against the facilities listed in subdivision (a)(18) brought by anygovernmental agency or accrediting agency within the past three (3) years andthe status or disposition of each matter with regard to patient care andcharitable asset matters;
(20) A list of uncompensated care provided over the pastthree (3) years by each facility listed in subdivision (a)(18) and detail as tohow that amount was calculated;
(21) Copies of all documents related to:
(i) Identification of all charitable assets
(ii) Accounting of all charitable assets for the past three(3) years; and
(iii) Distribution of the charitable assets including, butnot limited to, endowments, restricted, unrestricted and specific purpose fundsas each relates to the proposed transaction;
(22) A description of charity care and uncompensated careprovided by the existing hospital for the previous five (5) year period to thepresent including a dollar amount and a description of services provided topatients;
(23) A description of bad debt incurred by the existinghospital for the previous five (5) years for which payment was anticipated butnot received;
(24) A description of the plan as to how the new hospitalwill provide community benefit and charity care during the first five (5) yearsof operation;
(25) A description of how the new hospital will monitor andvalue charity care services and community benefit;
(26) The names of persons currently holding a position as anofficer, director, board member, or senior level management who will or willnot maintain any position with the new hospital and whether any said personwill receive any salary, severance stock offering or any financial gain,current or deferred, as a result of or in relation to the proposed conversion;
(27) Copies of capital and operating budgets or otherfinancial projections for the new hospital during the first three (3) years ofoperation;
(28) Copies of plans relative to staffing during the firstthree (3) years at the new hospital;
(29) A list of all medical services, departments and clinicalservices, and administrative services which will be maintained at the newhospital;
(30) A description of criteria established by the board ofdirectors of the existing hospital for pursuing a proposed conversion with oneor more health care providers;
(31) Copies of reports of any due diligence review performedby each transacting party in relation to the proposed conversion. These reportsare to be held by the attorney general and department of health as confidentialand not released to the public regardless of any determination made pursuant to§ 23-17.14-32 and not withstanding any other provision of the general laws;
(32) A description of request for proposals issued by theexisting hospital relating to pursuing a proposed conversion;
(33) Copies of reports analyzing affiliations, mergers, orother similar transactions considered by any of the transacting parties duringthe past three (3) years, including, but not limited to, reports by appraisers,accountants, investment bankers, actuaries and other experts;
(34) A copy of proposed contracts or description of proposedcontracts or arrangements with management, board members, officers, ordirectors of the existing hospital for severance consulting services orcovenants not to compete following completion of the proposed conversion;
(35) A copy or description of all agreements or proposedagreements reflecting any current and/or future employment or compensatedrelationship between the acquiror (or any related entity) and any officer,director, board member, or senior level manager of the acquiree (or any relatedentity);
(36) A copy or description of all agreements executed oranticipated to be executed by any of the transacting parties in connection withthe proposed conversion;
(37) Copies of documents or description of any proposed planfor any entity to be created for charitable assets, including but not limitedto, endowments, restricted, unrestricted and specific purpose funds, theproposed articles of incorporation, by-laws, mission statement, program agenda,method of appointment of board members, qualifications of board members, dutiesof board members, and conflict of interest policies;
(38) Description of all departments, clinical, social, orother services or medical services that will be eliminated or significantlyreduced at the new hospital;
(39) Description of staffing levels of all categories ofemployees, including full-time, part-time, and contract employees currentlyworking at or providing services to the existing hospital and description ofany anticipated or proposed changes in current staffing levels;
(40) Current, signed original conflict of interest forms fromall incumbent or recently incumbent officers, directors, members of the board,trustees, senior management, chairpersons or department chairpersons andmedical directors on a form acceptable to the attorney general; "incumbent orrecently incumbent" means those individuals holding the position at the timethe application is submitted and any individual who held a similar positionwithin one year prior to the application's acceptance;
(41) If the acquiror is a for profit corporation that hasacquired a not for profit hospital under the provisions of this chapter, theapplication shall also include a complete statement of performance during thepreceding one year with regard to the terms and conditions of approval ofconversion and each projection, plan, or description submitted as part of theapplication for any conversion completed under an application submittedpursuant to this section and made a part of an approval for the conversionpursuant to § 23-17.14-7 or 23-17.14-8;
(42) Copies of IRS Form 990 for any transacting partyrequired by federal law to file such a form for each of the five (5) yearsprior to the submission of the application.
(b) Two (2) copies of the initial application shall beprovided to each of the department of health and department of the attorneygeneral simultaneously by United States mail, certified, return receiptrequested.
(c) Except for information determined by the attorney generalin accordance with § 23-17.14-32 to be confidential and/or proprietary, orotherwise required by law to be maintained as confidential, the initialapplication and supporting documentation shall be considered public records andshall be available for inspection upon request.
§ 23-17.14-6 Initial application –Conversions involving for-profit corporations or not-for-profit as acquirors.– (a) No person shall engage in a conversion with a for profit corporation as theacquiror and a not-for-profit corporation as the acquiree involving theestablishment, maintenance, or operation of a hospital or a conversion subjectto § 23-17.14-9 without prior approval of both the department of attorneygeneral and the department of health. The transacting parties shall file aninitial application in accordance with subsection (b) of this section thatshall, at minimum, include the following information with respect to eachtransacting party and to the proposed new hospital:
(1) A detailed summary of the proposed conversion;
(2) Names, addresses and phone numbers of the transactingparties;
(3) Name, address, phone number, occupation, and tenure ofall officers, members of the board of directors, trustees, executives, andsenior level managers, including for each position, current persons and personsholding position during the past three (3) years;
(4) A list of all committees, subcommittees, task forces, orsimilar entities of the board of directors or trustees, including a shortdescription of the purpose of each committee, subcommittee, task force, orsimilar entity and the name, address, phone number, occupation, and tenure ofeach member;
(5) Agenda, meeting packages, and minutes of all meetings ofthe board of directors or trustees and any of its committees, subcommittees,task forces, or similar entities that occurred within the two (2) year periodprior to submission of the application;
(6) Articles of incorporation and certificate ofincorporation;
(7) Bylaws and organizational charts;
(8) Organizational structure for existing transacting partiesand each partner, affiliate, parent, subsidiary or related corporate entity inwhich the acquiror has a twenty percent (20%) or greater ownership interest;
(9) Conflict of interest statements, policies and procedures;
(10) Names, addresses and phone numbers of professionalconsultants engaged in connection with the proposed conversion;
(11) Copies of audited income statements, balance sheets,other financial statements, and management letters for the past three (3) yearsand to the extent they have been made public, audited interim financialstatements and income statements together with detailed description of thefinancing structure of the proposed conversion including equity contribution,debt restructuring, stock issuance, partnership interests, stock offerings andthe like;
(12) A detailed description of real estate issues includingtitle reports for land owned and lease agreements concerning the proposedconversion;
(13) A detailed description as each relates to the proposedtransaction for equipment leases, insurance, regulatory compliance, tax status,pending litigation or pending regulatory citations, pension plan descriptionsand employee benefits, environmental reports, assessments and organizationalgoals;
(14) Copies of reports analyzing the proposed conversionduring the past three (3) years including, but not limited to, reports byappraisers, accountants, investment bankers, actuaries and other experts;
(15) Copies of any opinions or memoranda addressing the stateand federal tax consequences of the proposed conversion prepared for atransacting party by an attorney, accountant, or other expert;
(16) A description of the manner in which the price wasdetermined including which methods of valuation and what data were used, andthe names and addresses of persons preparing the documents, and thisinformation is deemed to be proprietary;
(17) Patient statistics for the past three (3) years andpatient projections for the next one year including patient visits, admissions,emergency room visits, clinical visits, and visits to each department of thehospital, admissions to nursing care or visits by affiliated home health careentities;
(18) The name and mailing address of all licensed facilitiesin which the for-profit corporation maintains an ownership interest orcontrolling interest or operating authority;
(19) A list of pending or adjudicated citations, violationsor charges against the facilities listed in subdivision (a)(18) brought by anygovernmental agency or accrediting agency within the past three (3) years andthe status or disposition of each matter with regard to patient care andcharitable asset matters;
(20) A list of uncompensated care provided over the pastthree (3) years by each facility listed in subdivision (a)(18) and detail as tohow that amount was calculated;
(21) Copies of all documents related to:
(i) Identification of all charitable assets
(ii) Accounting of all charitable assets for the past three(3) years; and
(iii) Distribution of the charitable assets including, butnot limited to, endowments, restricted, unrestricted and specific purpose fundsas each relates to the proposed transaction;
(22) A description of charity care and uncompensated careprovided by the existing hospital for the previous five (5) year period to thepresent including a dollar amount and a description of services provided topatients;
(23) A description of bad debt incurred by the existinghospital for the previous five (5) years for which payment was anticipated butnot received;
(24) A description of the plan as to how the new hospitalwill provide community benefit and charity care during the first five (5) yearsof operation;
(25) A description of how the new hospital will monitor andvalue charity care services and community benefit;
(26) The names of persons currently holding a position as anofficer, director, board member, or senior level management who will or willnot maintain any position with the new hospital and whether any said personwill receive any salary, severance stock offering or any financial gain,current or deferred, as a result of or in relation to the proposed conversion;
(27) Copies of capital and operating budgets or otherfinancial projections for the new hospital during the first three (3) years ofoperation;
(28) Copies of plans relative to staffing during the firstthree (3) years at the new hospital;
(29) A list of all medical services, departments and clinicalservices, and administrative services which will be maintained at the newhospital;
(30) A description of criteria established by the board ofdirectors of the existing hospital for pursuing a proposed conversion with oneor more health care providers;
(31) Copies of reports of any due diligence review performedby each transacting party in relation to the proposed conversion. These reportsare to be held by the attorney general and department of health as confidentialand not released to the public regardless of any determination made pursuant to§ 23-17.14-32 and not withstanding any other provision of the general laws;
(32) A description of request for proposals issued by theexisting hospital relating to pursuing a proposed conversion;
(33) Copies of reports analyzing affiliations, mergers, orother similar transactions considered by any of the transacting parties duringthe past three (3) years, including, but not limited to, reports by appraisers,accountants, investment bankers, actuaries and other experts;
(34) A copy of proposed contracts or description of proposedcontracts or arrangements with management, board members, officers, ordirectors of the existing hospital for severance consulting services orcovenants not to compete following completion of the proposed conversion;
(35) A copy or description of all agreements or proposedagreements reflecting any current and/or future employment or compensatedrelationship between the acquiror (or any related entity) and any officer,director, board member, or senior level manager of the acquiree (or any relatedentity);
(36) A copy or description of all agreements executed oranticipated to be executed by any of the transacting parties in connection withthe proposed conversion;
(37) Copies of documents or description of any proposed planfor any entity to be created for charitable assets, including but not limitedto, endowments, restricted, unrestricted and specific purpose funds, theproposed articles of incorporation, by-laws, mission statement, program agenda,method of appointment of board members, qualifications of board members, dutiesof board members, and conflict of interest policies;
(38) Description of all departments, clinical, social, orother services or medical services that will be eliminated or significantlyreduced at the new hospital;
(39) Description of staffing levels of all categories ofemployees, including full-time, part-time, and contract employees currentlyworking at or providing services to the existing hospital and description ofany anticipated or proposed changes in current staffing levels;
(40) Current, signed original conflict of interest forms fromall incumbent or recently incumbent officers, directors, members of the board,trustees, senior management, chairpersons or department chairpersons andmedical directors on a form acceptable to the attorney general; "incumbent orrecently incumbent" means those individuals holding the position at the timethe application is submitted and any individual who held a similar positionwithin one year prior to the application's acceptance;
(41) If the acquiror is a for profit corporation that hasacquired a not for profit hospital under the provisions of this chapter, theapplication shall also include a complete statement of performance during thepreceding one year with regard to the terms and conditions of approval ofconversion and each projection, plan, or description submitted as part of theapplication for any conversion completed under an application submittedpursuant to this section and made a part of an approval for the conversionpursuant to § 23-17.14-7 or 23-17.14-8;
(42) Copies of IRS Form 990 for any transacting partyrequired by federal law to file such a form for each of the five (5) yearsprior to the submission of the application.
(b) Two (2) copies of the initial application shall beprovided to each of the department of health and department of the attorneygeneral simultaneously by United States mail, certified, return receiptrequested.
(c) Except for information determined by the attorney generalin accordance with § 23-17.14-32 to be confidential and/or proprietary, orotherwise required by law to be maintained as confidential, the initialapplication and supporting documentation shall be considered public records andshall be available for inspection upon request.
