Bradley J. Berg206.447.8970 | bergb@foster.com

AWPHD Retreat for Chief Executive Officers and Administrators Only

The Lodge at SuncadiaMay 20-21, 2009

Legal Update

Legal Update

Additional State Legislation

Special election date changes (ESHB 1018)

Changes February date from first Tuesday to second Tuesday

Eliminates election date in March

Permits use of May date until July 1, 2011 solely for levies that

failed previously in the same calendar year and new bond issues

and eliminates May election after that date

Reduces deadline for submission of ballot proposition resolution

for spring elections from 52 days to 45 days

Legal Update

Additional State Legislation (cont.)

Changes to procedures for unannounced inspections of hospitals by

the Department of Health (2SHB 1201)

DOH cannot issue its final report for an unannounced inspection until:

Hospital is given at least two weeks to provide any information or

documentation requested by DOH that was not available at the

time of the request

At least one DOH inspector meets personally with CEO or CEO

declines meeting

Legal Update

Additional State Legislation (cont.)

New reporting requirements (SSB 5056)

Hospitals must report treatment for bullet, gunshot or stab

wounds provided to patients who are unconscious and requires

that evidence be preserved

Imposes similar (although somewhat broader) reporting

requirements on physicians, EMTs and paramedics who

provide treatment outside of a hospital

Legal Update

Additional State Legislation (cont.)

Changes to procedures for filing claims against PHDs

(ESHB 1553)

Claims for health care injuries are exempted from the

claims filing procedures

Claims must be presented on a special form maintained by

OFM or special form developed by PHD, which must be

made available by PHD

Legal Update

New EMTALA On-Call Options

Effective October 1, 2008, the EMTALA rules were revised to

authorize “community on-call plans” that include the following

elements set forth in a signed agreement:

Delineation of each hospital’s responsibility

Description of geographic area covered

Inclusion in EMS system protocols

Confirmation of continuing EMTALA obligations

Annual review

Legal Update

New CAH Payments for Lab Tests

MIPPA of 2008 mandated that effective July 1, 2009, lab tests

furnished by CAH be paid on cost basis regardless of whether

patient is physically present at CAH at the time specimen is

collected

Proposed rules require that lab test be provided to individual

who is “an outpatient of CAH” (registered at the hospital;

receives services directly from the CAH on same day specimen

is collected; or specimen is collected by employee of CAH)

Legal Update

Capital Markets-Crisis

Hospitals may have been among the most severely affected

by dislocations in tax-exempt markets

Providers have been forced to reassess their capital needs

and sources of capital

Credit will be harder to access, cost more and carry with it

more restrictive terms

Long-term planning for credit worthiness and financial viability

are critical

Legal Update

Capital Markets-Municipal Yields To Treasuries

Legal Update

Capital Markets-Historical SIFMA IndexTax-Exempt Variable Rate History

SIFMA Index -- 1999 to Present

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

J-99 D-99 D-00 D-01 D-02 D-03 D-04 D-05 D-06 D-07 D-08

Inte

rest R

ate (%

)

Average = 2.47%

Current = 0.44%

Market Reactionto Lehman Bankruptcy,

AIG Bailout and "Breaking of the Buck" in prominent

money market fund.

Legal Update

Capital Markets-Looking Ahead

Fewer players in the municipal market:

underwriters, bond insurers, letter of credit banks, etc.

Emphasis on borrower’s credit

No Bond Insurers

Limited Letter of Credit availability

Continued volatility, challenging market conditions

Legal Update

Capital Markets-New Opportunities

Annual tax-exempt debt limitation for Bank Qualification

under Section 265(b)(3) is increased to $30,000,000 for

bond issued in 2009 and 2010

Build America Bonds (“BABs”) for bonds issued in 2009

and 2010

FHA Section 242 Insured Mortgage Program for Hospital

Financings

Legal Update

Capital Markets-Continuing Disclosure News

Amendments to SEC’s Rule 15c2-12 will be effective July 1

All continuing disclosure filings under new Continuing

Disclosure Undertakings will be made to the MSRB’s new

EMMA system

SEC’s No Action letters to existing NRMSIRs will be withdrawn

effective July 1 and sole NRMSIR will be the MSRB via its

EMMA system

Legal Update

Other Topics

Performance audit update

Application of IRS Form 990 reporting requirements to PHDs

Audit activities and update requirements relating to

retirement plans

Recent court decision expanding reporting requirements

under HCQIA relating to “investigations”

Recent court decision raising Stark and Anti-kickback

concerns for hospital-based provider agreements

Legal Update 15

Contact Information

Brad Berg

Telephone: 206-447-8970

Email: BergB@Foster.com

Foster Pepper PLLC

1111 Third Avenue, Suite 3400

Seattle, WA 98101

www.foster.com