Substitute Senate Bill No. 437

Special Act No. 00-12

An Act Establishing A Commission On The Future Of Hospital Care In Connecticut, Establishing The University Of Connecticut Health Center Review Committee And Concerning Funding For The University Of Connecticut Health Center.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (a) There is established a Commission on the Future of Hospital Care in Connecticut. The commission shall: (1) Review the current and projected financial condition of hospitals in this state, including, but not limited to, hospital corporations, holding companies, parent companies, affiliates, subsidiaries, other related entities and trusts or other endowments; (2) examine the financial and operating impact on hospitals of current state assessments, state regulatory costs, including certificate of need determination and licensing, adequacy and timeliness of third party payments, bond and debt structures, and incentives; (3) examine access to and the delivery of hospital health care in the state and on a regional basis, including, but not limited to, staffing levels and needs, total bed availability and capacity, historical and current service areas, and community benefits; (4) determine the financial and operating impact of managed care and the Federal Balanced Budget Act of 1997 on such hospitals, including the adequacy of federal Medicaid and Medicare reimbursement; (5) consider opportunities and impediments to collaboration and cooperative financial and operating arrangements among hospitals and other health care facilities in the state; (6) examine the impact, including health care delivery effectiveness, of past mergers, affiliations and other restructuring as well as competition from nonhospital health care facilities and medical service; (7) review the recruitment, education, training, assignment, and financing of undergraduate and graduate medical students and other hospital-based employment opportunities; and (8) consider the impact of information technology and medical technology on the efficiency and effectiveness of hospital operations and health care.

(b) (1) The commission shall consist of:

(A) Two members appointed by the president pro tempore of the Senate and two members appointed by the speaker of the House of Representatives;

(B) One member appointed by the majority leader of the Senate and one member appointed by the majority leader of the House of Representatives;

(C) Three members appointed by the minority leader of the Senate and three members appointed by the minority leader of the House of Representatives; and

(D) The chairpersons and ranking members of the joint standing committee of the General Assembly having cognizance of matters relating to public health.

The Secretary of the Office of Policy and Management, the Commissioner of Public Health and the Commissioner of Health Care Access, or their designees, shall serve as ex-officio members of the commission. All appointments to the commission shall be made not later than thirty days following the effective date of this act and any vacancy shall be filled by the appointing authority within thirty days following notice of such vacancy. The chairpersons of the joint standing committee of the General Assembly having cognizance of matters relating to public health shall serve as chairpersons of the commission and shall convene the first meeting of the commission not later than sixty days following the effective date of this act.

(2) The administrative staff of the joint standing committee of the General Assembly having cognizance of matters relating to public health shall serve as administrative staff to the commission.

(3) Not later than January 1, 2001, the commission shall submit an interim report of its activities, findings and recommendations, if any, and not later than January 1, 2002, shall submit a final report of its activities, findings and recommendations, if any, to the joint standing committee of the General Assembly having cognizance of matters relating to public health, in accordance with the provisions of section 11-4a of the general statutes. The commission shall terminate on January 1, 2002.

Sec. 2. (a) The Board of Trustees of The University of Connecticut shall prepare quarterly reports, pursuant to subsection (b) of this section, for The University of Connecticut Health Center.

(b) Each report shall contain the following information for the previous quarter: (1) Financial results for the health center as a whole and for its component parts, including an income statement, balance sheet and cash flow statistics and a financial forecast comparing such results to the budget; (2) restructuring, cost cutting and revenue enhancement information, including a description of actions taken and timetables, progress made, financial and other impact, and information on measurement and accountability; and (3) operational results, including performance for all units of the health center.

(c) The reports required under this section shall be submitted to The University of Connecticut Health Center Review Committee in accordance with the following schedule by: (1) August fifteenth for the quarter ending June 30, 2000, (2) November fifteenth for the quarter ending September 30, 2000, (3) February fifteenth for the quarter ending December 31, 2000, and (4) May fifteenth for the quarter ending March 30, 2001.

Sec. 3. (a) There is created The University of Connecticut Health Center Review Committee. The review committee shall be composed of the chairpersons and ranking members of the joint standing committees of the General Assembly having cognizance of matters relating to public health, education and appropriations and the budgets of state agencies, or their designees who shall be members of the respective committees of cognizance.

(b) The speaker of the House of Representatives and the president pro tempore of the Senate shall each appoint one member of the review committee to serve as cochairpersons. The staff of the joint standing committees of the General Assembly having cognizance of matters relating to public health, education and appropriations and the budgets of state agencies shall provide administrative and clerical support to the review committee.

(c) Notwithstanding any provision of the general statutes, the authority of the review committee during its term shall include, but not be limited to, the following: (1) To review financial and clinical data of The University of Connecticut Health Center, including each of its component parts; (2) to review and monitor the implementation of all restructuring, cost efficiencies, revenue enhancement plans and strategic plans for the health center; (3) to review operational results, including performance for all units of the health center; (4) to evaluate the future role of the John Dempsey Hospital, The University of Connecticut schools of medicine and dental medicine, and the health center's delivery of the correctional managed care program; (5) to evaluate medical education, research and health care delivery; (6) to review student tuition and fee levels for The University of Connecticut schools of medicine and dental medicine; (7) to review and monitor the health center administrative, faculty, physician, professional and nonprofessional compensation, benefits and contracts; (8) to make recommendations concerning affiliated foundation efforts and other fundraising activities, including, but not limited to, the establishment of an endowment fund; (9) to review the performance audit to be conducted pursuant to section 4 of this act; (10) to make recommendations concerning quarterly and annual reporting requirements for the health center, including each of its component parts; (11) to suggest future ongoing reporting requirements for public health and research initiatives conducted by the health center; (12) to evaluate placement and financing of medical student residents; (13) to make recommendations concerning the establishment of a board of directors for the John Dempsey Hospital that would report to the Board of Trustees of The University of Connecticut; and (14) to make recommendations concerning whether public act 92-154 should be amended.

(d) Not later than December 1, 2000, and July 1, 2001, the review committee shall submit interim reports to the General Assembly and the Governor, and not later than January 1, 2002, shall submit a final report to the General Assembly and the Governor, in accordance with the provisions of section 11-4a of the general statutes, concerning its review of the operations of The University of Connecticut Health Center. The review committee shall include in such reports (1) a review of the findings and recommendations made in the performance audit conducted pursuant to section 4 of this act, and (2) the fiscal implications of any recommendation contained in such reports. The review committee shall terminate upon the submission of the final report required under this subsection.

(e) Nothing in this section shall be construed to alter the governance, fiscal authority or operating responsibilities of the Board of Trustees of The University of Connecticut under chapter 185b of the general statutes.

Sec. 4. (a) The Auditors of Public Accounts, in consultation with the Department of Higher Education, shall issue a request for proposals for an independent performance audit of The University of Connecticut Health Center, including each of its component parts. The Auditors of Public Accounts shall enter into a contract for a performance audit that shall include, but not be limited to:

(1) A review of the quarterly reports submitted to The University of Connecticut Health Center Review Committee pursuant to section 2 of this act. Such review shall also include financial statements that have a clear allocation of all health center income and expenses to each operating function of the health center for the 2000 fiscal year of the health center and a comparison with planned and actual results for the 2001 fiscal year of the health center;

(2) An examination of health center governance issues relating to management responsibilities, avoidance of conflict of interests and fiscal management practices, and a recommendation concerning the establishment of a board of directors for the John Dempsey Hospital that would report to the Board of Trustees of The University of Connecticut;

(3) A systematic assessment of the health center's core competencies and their relationship to (A) enhancing the quality of The University of Connecticut schools of medicine and dental medicine, and (B) the health center's stated objectives;

(4) Review the economy and efficiency audits concerning the use of health center resources and implementation of plans for identifying more effective means to allocate health center resources so as to achieve cost efficiencies in the delivery of care;

(5) (A) An assessment of health center: Management oversight; faculty, administrative and professional compensation policies; and fiscal and programmatic comparison to governance, organization, management, compensation and benefits, medical and dental education costs and revenues, research, health services and efficiency and effectiveness with respect to other comparable university-based health centers, schools of medical and dental education and hospitals; and (B) recommendations for ways in which the health center can reduce costs, improve management and make services more effective and efficient;

(6) The identification of methods to maximize federal and third party funding;

(7) Information concerning the average daily census by specialty at the John Dempsey Hospital and recommendations on how to increase such average daily census;

(8) A review of the appropriate assignment and use by the health center of federal cost recovery funds and residency programs;

(9) A review of contractual obligations of the health center;

(10) Information and recommendations concerning community benefits, economic development benefits and economic development potential associated with biomedical and biotechnology research;

(11) An evaluation of cutbacks in federal funding and payments; and

(12) The identification of significant issues that warrant further audit but are not directly related to the objectives of the performance audit.

(b) The Board of Trustees of The University of Connecticut shall submit a management response from responsible officials to the auditor concerning each of the recommendations contained in the performance audit conducted pursuant to subsection (a) of this section.

(c) Performance audit interim reports shall be submitted to The University of Connecticut Health Center Review Committee in a timely manner for use by the review committee in preparing the reports required under subsection (d) of section 3 of this act.

(d) The performance audit conducted pursuant to subsection (a) of this section shall be in addition to any financial or operational audit required under any provision of the general statutes or any public or special act.

Sec. 5. Not later than October 1, 2000, and quarterly thereafter during the term of The University of Connecticut Health Center Review Committee, the chief executive officer of The University of Connecticut shall submit a report to The University of Connecticut Health Center Review Committee concerning the planned and actual use of funds appropriated to The University of Connecticut Health Center pursuant to section 36 of special act 00-13 and sections 6 and 7 of this act.

Sec. 6. The sum of twelve million five hundred thousand dollars appropriated to The University of Connecticut Health Center, from the General Fund, for the fiscal year ending June 30, 2000, pursuant to section 36 of special act 00-13 shall not lapse on June 30, 2000, and shall be available for expenditure by The University of Connecticut Health Center during the fiscal year ending June 30, 2001.

Sec. 7. The sum of four million four hundred thousand dollars appropriated to The University of Connecticut Health Center, from the General Fund, for the fiscal year ending June 30, 2001, pursuant to section 36 of special act 00-13 shall not lapse on June 30, 2001, and shall be available for expenditure by The University of Connecticut Health Center during the fiscal year ending June 30, 2002.

Sec. 8. The sum of three million one hundred thousand dollars appropriated to The University of Connecticut Health Center, from the General Fund, for the fiscal year ending June 30, 2000, for the purpose of The University of Connecticut Health Center research pursuant to section 36 of special act 00-13 shall not lapse on June 30, 2000, and shall be available for expenditure for such purpose during the fiscal year ending June 30, 2001.

Sec. 9. This act shall take effect from its passage.

Approved June 1, 2000