What’s happening: On December 15, 2023, the state Board of Health (BOH) approved a new Certificate of Public Need (COPN) application fee schedule to begin the “Fast Track” regulatory development process. 

• Under the proposed schedule, all COPN projects will incur higher fees due to increases in overall fee rates and fee caps.

Why VDH is taking this action: VDH’s goal is to ensure the agency receives sufficient revenue to support its COPN program and the mandated activities that the COPN program carries out.

• Of note, the COPN fee cap has not been changed in over 20 years and does not include a fee for the registration process.

About the changes: In a recent advisory, Hancock Daniel outlined the fee schedule changes:

• An increase of the fee percentage for COPN applications from 1% to 1.5% of the total capital expenditure
• An increase of the minimum fee cap from $1,000 to $1,600
• An increase of the maximum fee cap from $20,000 to $44,000
• Required payment of $70 for registration of replacement of existing medical equipment
• Required payment of $70 for registration of certain capital expenditures
• Prescription of a $50 fee for dishonored payments (e.g., check or money draft not honored by bank or financial institution named)

For context: In 2021, VDH had a proposal to increase the fees for COPN applications to fund the operations of that unit within VDH. The proposal would have increased the maximum fee cap from $20,000 to $60,000.

• VHCA-VCAL offered informal comments to VDH the proposed fee schedule changes noting that nursing facilities would have concerns with the initial approach to updating the schedule. 
• In consultation with VHCA-VCAL and the Virgina Hospital and Healthcare Association (VHHA), VDH agreed to temporarily withdraw the proposed regulation while stakeholders worked on an alternative approach. VHCA-VCAL’s input was derived with feedback from our Health Planning Committee.

Next steps: Following approval by the BOH, the amendments will be submitted to the Office of the Attorney General to begin the Executive Branch review process, as specified by the Administrative Process Act.

• Following Executive Branch review and approval, the proposed regulatory text will be published in the Virginia Register of Regulations and on the Virginia Regulatory Town Hall website. A 30-day public comment period will begin. If the proposal meets certain “Fast Track” requirements, fifteen days after the close of the public comment period, the regulation will become effective.
• It is anticipated that this action will be noncontroversial in part because of stakeholder engagement by VHCA-VCAL and VHHA.