HEAL NY Phase 2:
Capital Restructuring Initiatives
Request for Grant Applications
Applicant Conference
June 28, 2006
1:00pm - 4:00pm
June 28, 2006
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Conference Panelists
• David Wollner - DOH, Director of OHSM
• Neil Benjamin - DOH, Div. of Health Facility
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Planning, and Moderator
Christopher Delker - DHFP - Evaluation Co-Chair
Robert Schmidt - DHFP, HEAL Implementation Unit
Dennis Kling - DOH Div. Of Health Care Financing
and Evaluation Co-Chair
Robert Veino - DOH, Div. Of Legal Affairs
Lora Lefebvre - DASNY - Portfolio Management
Debbie Paden - DASNY – Counsel’s Office
June 28, 2006
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The HEAL NY Program
(Section 2818 of PHL)
• Up to $1 billion available through
appropriations and bond proceeds through
DoH and DASNY
- To support restructuring plans in regional areas
– To support Health Information Technology projects on
a regional level
• HEAL Phase 1 $52.9 million
- Health Information Technology (HIT) projects
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HEAL NY - Phase 2
• Provide grants to assist projects that will achieve
closure, downsizing or physical reconfiguration of
hospitals and nursing homes
• Support capital restructuring plans in regional
areas that result in improved quality, stability and
efficiency of health care services
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Objectives
• Improve quality, stability and efficiency of
regional health care systems delivery
• Right-size through closure, consolidation
and/or conversion of providers, programs
and beds
• Eliminate duplication of services within
communities, including reducing hospital
and nursing home beds
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Objectives
• Promote the development of services in
the community at the appropriate level
and cost
• Ensure against mortgage defaults or calls
on mortgage insurance
• Reduce the rate of increase in health care
spending
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HEAL NY Phase 2 Funding
• Up to $269.4 million
Capital Appropriations to DOH -$74.4 million
- Capital bonding authority through DASNY $195.0 million
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• Projects require at least a 50% match of nonstate funds.
• If financially distressed – at least a 30% match
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Grant Funding Sources
• DASNY Bond Proceeds
- State supported debt: Grant funds must be used for
“capital work or purpose” per State Finance Law
- If tax-exempt bonds: must also be consistent with
Federal Tax Law
• Capital Appropriations and Matching Funds
can be for broader capital purposes, such as
- Net closure costs (12 month period)
- Debt retirement
- Building security/insurance
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Approximate Regional Allocation of Funds
Including Regional, Rural and Small Category Awards
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Northern - $20.0 million
Western - $22.6 million
Hudson Valley – $31.5 million
Long Island - $39.1 million
Central - $42.5 million
New York City - $113.7 million
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Select Category and Region
• Select One Category:
– Rural Projects
– Small Projects
– Regional Awards
June 28, 2006
• Select One Region:
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New York City
Long Island
Hudson Valley
Northern
Central
Western
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Grant Categories
Applicants must select one category in which to compete:
• Rural Projects Category (see RGA attachments 3 & 4)
- Up to $20 million in total grants
- Grant request cannot exceed $1.5 million (50%
match) or $2.1 million (30% match)
• Small Projects Category
- Up to $10 million in total grants
- Grant request cannot exceed $500,000 (50% match) or
$700,000 (30% match)
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Grant Categories
Applicants must select one category in which to compete:
Regional Awards Category
6 geographic regions within New York
- Grant request cannot exceed $37.5 million
(50% match) or $52.5 million (30% match)
- Total dollar value of Grant awards in a region
will be reduced by the dollar value of Small and
Rural projects awarded in that region.
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Eligible Applicants
• Article 28 Hospital or Nursing Home
• Active Member of Article 28
Corporations
• Multi-provider applications allowed
• Must designate Lead Applicant responsible
for all administration of grant funds
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Examples - Capital Restructuring Projects
• Close or downsize hospitals or
nursing homes to take beds out of
service in particular geographic
regions
• Consolidate hospitals, or nursing
homes, completely or partially
Continued….
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Examples - Capital Restructuring Projects
(continued)
• Convert challenged, but needed
hospitals, to levels of care more
consistent with community needs
• Convert under-utilized hospitals, or
portions thereof, to downsized or noninpatient services
Continued….
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Examples - Capital Restructuring Projects
(continued)
• Decertify unneeded nursing home beds and, where
appropriate, convert vacant space for use as
enhanced common living areas or provide long
term care, such Assisted Living Programs and
Adult Day Health Care Programs
• Manage long and short term capital debt
obligations in a manner that will further the
overall health system restructuring goals of HEAL
NY and the Commission on Health Care Facilities
in the Twenty-first Century
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Part One: Technical Application
Executive Summary
– Briefly describe the overall project
– How it meets HEAL NY Capital
Restructuring Initiative objectives and
requirements (RGA Sections 1.2 and 1.3)
– How Eligible Applicant(s) meet eligibility
criteria (1.4)
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Part One: Technical Application
• Project Description
• Overview
• Project Outcomes
• Project Timeline
• Project Team
• Project Monitoring Plan
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Regulatory Requirements
• Receipt of grant funds and execution of a
GDA conditioned on Eligible Applicant
meeting all regulatory requirements
• CON requirements (10 NYCRR 710.1)
• SEQRA compliance
• Federal and State standards of care
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Project Timeframes
• Term of GDA’s expected to begin on or
about October 1, 2006
• Projects timeframe - up to two years
• If solely closing a facility – 12 month
project timeframe
• All reimbursable costs must be
incurred within period of GDA
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Allowed Grant Expenditure Types
• Restructuring, Reconfiguration, Debt
Restructuring
- Capital costs to reconfigure infrastructure
- Equipment expense
- Capital acquisition cost associated with downsizing
• Closure Costs
• Applications must include justification for all
costs and whether applicant believes the expense
to be a bondable capital expense (RGA Attachment 7)
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Matching Funds
• Grants are considered for up to 50% of Projects
total cost
• Projects that include one or more financially
distressed entities with a significant role (see RGA
section 1.8.3) – eligible for up to 70% grant
• Any proceeds from sale of assets as part of a
restructuring must be applied to the Project cost
and counted as matching funds
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Matching Funds
(continued)
• Matching funds from other sources – other than
New York State grants (Applicant Funds, Program
Income, Foundations, Loans)
• Applicant must provide written documentation of
funding commitments; contingent commitments
acceptable
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Matching Funds Criteria
• Only direct costs. No indirect costs such
as administrative
• Costs financed by program income
during project
• Verifiable in-kind contributions
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Matching Funds Criteria
(continued)
• Donated services at fair market value or rental
rate (Excludes Vendor discounting)
• All matching costs must be incurred within the
period of the Grant Disbursement Agreement
• Project planning costs will NOT count toward
match and are NOT reimbursable.
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Part Two: Financial Application
Executive Summary
Project Budget
- Certification of Financial Distress, if applicable
- Project Budget Expenses and Justification
Project Fund Sources - HEAL grant amount and matching
funds
Cost Effectiveness - Evidence of verifiable savings relative
to Project cost
Project Financial Viability – Feasibility Plan (balance sheet,
income statement and cash flows – 3 years)
Improvement to Financial Viability of Financially Distressed
Entity
continued
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Part Two: Financial Application
(continued)
Eligible Applicant Financial Stability
General Corporate Information
- List of vendor contracts
- List of grant applications applied for /
awarded
- Name and Certificate of Incorporation of
Parent, Sibling, or Sub-Corp of Applicant
- Copy of Applicant Form 990 or Attorney
General Filing
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Application Evaluation Process
Joint Review and Award Process: DOH and DASNY
• Stage 1: Completeness of Application
- Applications missing material elements
eliminated from further review
• Stage 2 (a): Applicant Eligibility Review
- Eligible Applicant is an Article 28 Hospital,
Nursing Home or an active Member of an
Article 28 Corporation
(continued)
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Application Evaluation Process
(continued)
• Stage 2 (b) : Financial Eligibility Review
- Project Eligibility (Allowable Expense) and
Budget (Attachment 7) has 50% of Project funds
from sources other than HEAL Grant
(30% if qualifies as Financially Distressed (RGA
Section 1.8.3)
• Stage 3: Application Scoring
- Technical score (65%)
- Financial score (35%)
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Application Evaluation Criteria
• Reduction in excess health system cost or
usage
• Project’s return on investment and cost
effectiveness
• Public Health care need continues to be
met and is improved
• Ability to meet regulatory requirements
and timing
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Application Evaluation Criteria
(continued)
• Ability of Eligible Applicant to achieve
Project goals
• Ability of Eligible Applicant to fund its share
of Project
• Overall cost and reasonableness of Project
Budget
• Responsiveness and completeness of Grant
Application
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Selection of Awards
• Factors
- Minimum total score(s) are being considered
- Demonstrable and verifiable savings of health
care expenses preferred
• Rural and Small Projects in each Region
selected first
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Selection of Awards
(continued)
• Grant awards may be less than amount
requested due to limitations of funds and
other factors
• DOH and DASNY reserve the right to
reallocate funds among categories and
regions to serve the best interest of the
State.
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Submitting the Application
• Applications must be received by 4:00 pm,
July 31, 2006 in Room 1325 of Corning Tower
• Applications must be labeled:
HEAL NY Phase 2:
Capital Restructuring Initiatives
RGA# 0604261035
• Applications must not include any cost
information in the technical application
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Submitting the Application
(continued)
• 2 complete original and signed copies,
along with:
11 copies of the Technical Application and
6 copies of the Financial Application
• Use the Application Checklist for Completeness
• Applications should be submitted to:
Fred Genier
Director, Grants and Procurement Section
New York State Department of Health
Room 1325 Corning Tower
Albany, New York 12237-0016
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Certification for HEAL NY Grants
 Applicant will make every effort to ensure that the project
described in this application will be consistent with the
goals and recommendations, when available, of the
Commission on Health Care Facilities in the Twenty-First
Century, as established pursuant to Section 31 of Part E of
Chapter 63 of the Laws of 2005.
 All contracts entered into by the Grantee in connection
with the Project shall (A) provide that the work covered by
such contract shall be deemed “public work” subject to and
in accordance with Articles 8, 9 and 10 of the Labor Law;
and (B) shall provide that the contractors performing work
under such contract shall be deemed “state agencies” for
the purposes of Article 15A of the Executive Law
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Certification for HEAL NY Grants
(continued)
 If awarded a HEAL NY grant, the funds will be expensed
solely for the project purposes described in this RGA and
in the GDA and for no other purpose
 I understand that in the event that the project funded with
the proceeds of a HEAL NY grant ceases to meet one or
more of the criteria set forth above, then DOH and/or the
Dormitory Authority shall be authorized to seek
recoupment of all HEAL NY grant funds paid to the
Grantee and to withhold any grant funds not yet disbursed
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Key Dates
• Any questions regarding the application
process can be sent to:
[email protected]
• Questions Due: July 7, 2006
- The Q&A document will be posted by July 14,
2006 on the DOH website at:
http://www.nyhealth.gov/funding/
• Application Due: July 31, 2006
• Term of GDA’s expected to begin: October 2006
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