HB 271 — An Act establishing the Distressed Hospital Grant Program to award grants to distressed hospitals to prevent the reduction of services or cessation of operations; and making an appropriation.

PRINTER'S NO.   215

                   THE GENERAL ASSEMBLY OF PENNSYLVANIA



                        HOUSE BILL
                        No. 271
                                                Session of
                                                  2025

     INTRODUCED BY CAUSER, CIRESI, CUTLER, JAMES, PICKETT AND VITALI,
        JANUARY 22, 2025

     REFERRED TO COMMITTEE ON HEALTH, JANUARY 22, 2025


                                     AN ACT
 1   Establishing the Distressed Hospital Grant Program to award
 2      grants to distressed hospitals to prevent the reduction of
 3      services or cessation of operations; and making an
 4      appropriation.
 5      The General Assembly of the Commonwealth of Pennsylvania
 6   hereby enacts as follows:
 7   Section 1.   Short title.
 8      This act shall be known and may be cited as the Distressed
 9   Hospital Grant Program Act.
10   Section 2.   Definitions.
11      The following words and phrases when used in this act shall
12   have the meanings given to them in this section unless the
13   context clearly indicates otherwise:
14      "Applicant."    A distressed hospital that submits an
15   application under section 5(a) to the department for a grant
16   under the program.
17      "Department."     The Department of Health of the Commonwealth.
18      "Designated medically underserved area."     As defined in
19   section 1301 of the act of December 2, 1992 (P.L.741, No.113),
 1   known as the Children's Health Care Act.
 2      "Distressed hospital."     A hospital that meets all of the
 3   following criteria:
 4          (1)     The hospital had a negative profit margin for at
 5      least the previous three consecutive calendar years or fiscal
 6      years.
 7          (2)     The hospital is located more than 25 miles of travel
 8      distance on a roadway to another hospital located within this
 9      Commonwealth.
10      "Grant."    An amount of money awarded by the department under
11   the program.
12      "Hospital."     Any of the following:
13          (1)     A hospital licensed by the department under section
14      808 of the act of July 19, 1979 (P.L.130, No.48), known as
15      the Health Care Facilities Act, that provides inpatient
16      medical care and other related services for surgery, acute
17      medical conditions or injuries.
18          (2)     A hospital licensed by the department under section
19      808 of the Health Care Facilities Act that specializes in
20      services exclusively to infants, children, adolescents and
21      young adults from birth up to 21 years of age.
22      "Program."    The Distressed Hospital Grant Program established
23   under section 3.
24      "Rural county."    A county of this Commonwealth where the
25   number of people per square mile within the county is less than
26   291.
27   Section 3.    Establishment of program.
28      The Distressed Hospital Grant Program is established within
29   the department for the purposes specified under this act.
30   Section 4.    Awards of grants.

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 1      The department shall award grants in accordance with this act
 2   from money appropriated by the General Assembly for grants.
 3   Section 5.     Applications for grants.
 4      (a)   Applications.--A distressed hospital may apply for a
 5   grant. The department shall develop the application in a form
 6   determined by the department and make the application available
 7   electronically on the department's publicly accessible Internet
 8   website. To be eligible for a grant, a distressed hospital shall
 9   include any information required by the department in the
10   application, including the certification under section 6.
11      (b)   Consideration.--No later than 45 days after the
12   effective date of this subsection, the department shall receive
13   and consider applications on a rolling basis until funding for
14   grants has been completely expended, or until December 31, 2029,
15   whichever occurs first.
16   Section 6.     Certification requirements.
17      (a)   Certification.--An applicant shall, in good faith,
18   certify all of the following to the department:
19            (1)   The applicant is a distressed hospital and, if
20      applicable, meets one of the criteria specified under section
21      9 for a priority to receive a grant.
22            (2)   The distressed hospital will remain in operation and
23      does not intend to reduce services or cease operations within
24      two years of the date of receipt of a grant.
25            (3)   The grant will be used to prevent the distressed
26      hospital from reducing services or ceasing operations.
27            (4)   The grant will not be used to pay a remuneration to
28      the distressed hospital's executives, administrators or
29      administrative support staff.
30            (5)   The distressed hospital has not been awarded more

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 1      than one grant during a calendar year or fiscal year.
 2            (6)   The distressed hospital has taken measures to
 3      affiliate or enter into a business arrangement with another
 4      person to prevent the distressed hospital from reducing
 5      services or ceasing operations. The distressed hospital shall
 6      provide supporting documentation to the department for the
 7      measures required under this paragraph.
 8            (7)   The information provided in the application under
 9      section 5 and this section and all supporting documentation
10      is true and accurate in all material aspects.
11      (b)   False statements.--An applicant or an authorized
12   representative of the applicant that knowingly makes a false
13   statement to obtain a grant shall be subject to 18 Pa.C.S. §
14   4904 (relating to unsworn falsification to authorities).
15   Section 7.     Review of applications.
16      (a)   Approval or disapproval.--No later than 60 days after
17   the department has received a completed application under
18   section 5(a), the department shall approve or deny the
19   application for a grant. The department shall provide a notice
20   to the applicant of any of the following:
21            (1)   The application for a grant is approved.
22            (2)   The application for a grant is denied and the
23      reasons for denying the application.
24            (3)   The application for a grant is approved for an
25      amount less than requested by the applicant and the reasons
26      for approving an amount less than requested by the applicant.
27      (b)   Grant agreements.--Upon approving an application under
28   subsection (a), the department shall enter into a grant
29   agreement with the distressed hospital to award the grant. The
30   grant agreement shall explain the terms and conditions of the

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 1   grant, including the applicable laws of this Commonwealth and
 2   reporting requirements. The department, the distressed hospital
 3   and any other applicable party may enter the grant agreement via
 4   electronic signature.
 5   Section 8.     Distribution of grant money.
 6      No later than 60 days after approving an application under
 7   section 7(a), the department shall distribute grant money to a
 8   distressed hospital in accordance with this act as follows:
 9            (1)   The distressed hospital may receive an amount equal
10      to no more than 20% of the amount of money available for the
11      program.
12            (2)   The department may award grants to the distressed
13      hospital in increments of $1,000, subject to the limitation
14      under paragraph (1).
15            (3)   The department may not distribute grant money to the
16      distressed hospital unless the department, the distressed
17      hospital and any other applicable party have fully executed a
18      grant agreement under section 7(b).
19   Section 9.     Priority of grant awards.
20      In awarding grants, the department shall prioritize all of
21   the following:
22            (1)   A distressed hospital that has provided notice to
23      the department that the distressed hospital will reduce
24      services or cease operations under 28 Pa. Code § 51.3
25      (relating to notification).
26            (2)   A distressed hospital located in a designated
27      medically underserved area.
28            (3)   A distressed hospital located in a rural county.
29   Section 10.     Reports.
30      (a)   Publication.--No later than December 31 of each year,

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 1   the department shall publish a report on the department's
 2   publicly accessible Internet website that contains the following
 3   information:
 4            (1)   A list of each grant.
 5            (2)   The name and address of each grant recipient.
 6            (3)   The amount of the grant and a description of the
 7      financial impact to the grant recipient.
 8      (b)   Submission.--The department shall submit the report
 9   under subsection (a) to the following:
10            (1)   The chair and minority chair of the Appropriations
11      Committee of the Senate.
12            (2)   The chair and minority chair of the Appropriations
13      Committee of the House of Representatives.
14            (3)   The chair and minority chair of the Health and Human
15      Services Committee of the Senate.
16            (4)   The chair and minority chair of the Health Committee
17      of the House of Representatives.
18      (c)   Final report.--Upon disbursement of all money
19   appropriated for grants, or December 31, 2029, whichever is
20   earlier, the department shall publish a final report under
21   subsection (a).
22   Section 11.    Appropriation.
23      The sum of $100,000,000 is appropriated from the General Fund
24   to the department for the award of grants. The appropriation
25   shall not lapse and shall be available for use until the
26   disbursement of all money appropriated for the program, or
27   December 31, 2029, whichever is earlier.
28   Section 12.    Effective date.
29      This act shall take effect immediately.



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