Passed by the Senate March 14, 2005 YEAS 44 NAYS 3 ________________________________________ President of the Senate Passed by the House April 5, 2005 YEAS 91 NAYS 1 ________________________________________ Speaker of the House of Representatives		CERTIFICATE I, Thomas Hoemann, Secretary of the Senate of the State of Washington, do hereby certify that the attached is SUBSTITUTE SENATE BILL 5178 as passed by the Senate and the House of Representatives on the dates hereon set forth. ________________________________________ Secretary
Approved ________________________________________ Governor of the State of Washington		FILED Secretary of State State of Washington

AN ACT Relating to licensing specialty hospitals; creating new sections; providing an expiration date; and declaring an emergency.

NEW SECTION. Sec. 1 The federal government has established an eighteen-month moratorium on the exemption under 42 U.S.C. 1395nn that allows physicians to refer patients to physician-owned specialty hospitals. The moratorium effectively prevents the establishment of any new physician-owned specialty hospitals reimbursed under medicare and other federal health programs until the medicare payment advisory commission and the secretary of health and human services each conduct a study to assess physician-owned specialty hospitals. The legislature finds that imposing a similar moratorium on the licensing of any new physician-owned specialty hospital until the results of the medicare payment advisory commission and health and human services' studies are available is necessary to enable the legislature to determine the appropriate regulation of physician-owned specialty hospitals in Washington.

NEW SECTION.  Sec. 2   (1) From January 1, 2005, until July 1, 2006, no specialty hospital in which a physician, or an immediate family member of a physician, has an ownership or investment interest shall be granted a license under chapter 70.41 RCW.
     (2) For the purposes of this section:
     (a) "Specialty hospital" means a subclass of hospital that is primarily or exclusively engaged in the care and treatment of one of the following categories: (i) Patients with a cardiac condition; (ii) patients with an orthopedic condition; (iii) patients receiving a surgical procedure; and (iv) any other specialized category of services that the secretary of health and human services designates as a specialty hospital.
     (b) An ownership or investment interest in a specialty hospital may be through equity, debt, or other means and includes an interest in an entity that holds an ownership or investment interest in a specialty hospital.

NEW SECTION. Sec. 4 This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect immediately.