Medical Technology Demonstration Project: Proton Beam Therapy Questions and Answers as of May 28, 2010

The Department is extending the deadline for questions concerning the proton beam therapy medical technology demonstration project until . When answers are posted, a notice will be distributed via the CON Listserv.

Question: According to the Medical Technology Demonstration Project Proton Beam Therapy Announcement it appears as though the application is composed of an establishment CON and a 25 page supplemental application with attachments. In order to prepare a complete application in compliance with DOH's instructions, please provide more specific guidance regarding the required format of the application and which aspects of the application are subject to page limitations.

The application includes an establishment CON, if a new licensed operator is proposed for establishment. It also includes "[a]ll applicable CON schedules required for a full review for construction." The page limitation applies only to item 2 under the heading "Application Process" in the Announcement - "Any other information that the applicant deems pertinent to the criteria set forth above [i.e., the minimum requirements and evaluation criteria]." The page limitation does

Question: Will the CON and the supplemental application be reviewed together so that material included in the CON does not need to be repeated in the supplemental application?

Yes, they will be reviewed together, and material in the CON schedules need not be repeated. However, if information relevant to the minimum requirements or demonstration evaluation criteria, for example, can be found in the CON schedules, it may make sense to include a statement identifying where in the CON schedules the information can be found.

Question: Please clarify if the application deadline for the Proton Beam Therapy Demonstration project includes all CON schedules necessary. In other words, does the applicant have to file the entire CON prior to the June 21 deadline?

Yes. Part 705 of the regulations provides that applications must be submitted within 45 days of the announcement. Accordingly, all required CON schedules for a construction application subject to full review, as well as all establishment schedules if a new licensed operator is proposed, and all demonstration-related information requested in the Announcement must be submitted no later than June 21 at 3:00 p.m.

Question: How many copies of the application are to be submitted to Project Management?

8 copies.

Question: Is an electronic version – flash drive, CD - of the application required? – flash drive, CD - of the application required?


Question: In regard to Schedule 9 of the CON Application is there any minimum equity contribution required (i.e. non-financed) for the capital project costs?

Standard expected project cost equity contributions apply to projects conducted under the PBT medical technology demonstration project. An equity contribution of at least 10 percent is expected

Question: CON Schedule 5 states that borrowed funds are limited to 50% of total working capital requirements. To the extent that the applicant can show project feasibility and meet all other demonstration project goals would DOH consider a larger working capital financing percentage?

Standard working capital policy applies – borrowed funds should be limited to no more than 50 percent of the total working capital need. Minimum working capital need is typically two months of third-year operating expenses.

Question: Under 10 NYCRR 705.11 "reimbursement for demonstration projects is subject to the pertinent provisions of Part 86; provided, however, that reimbursement pursuant to title 11 (Medical Assistance for Needy Persons) of article 5 of the Social Services Law shall not be available unless there is Federal financial participation pursuant to title XIX of the Social Security Act (Medicaid)." Will there be Medicaid reimbursement for these services during the demonstration? If so, can DOH provide estimated rates and the anticipated date Medicaid reimbursement would be effective to be incorporated in the CON projections?

Medicaid will provide reimbursement for these services, provided that all applicable Medicaid reimbursement requirements are met. It is expected that PBT services will be reimbursed through the ambulatory patient group (APG) system. For diagnostic and treatment centers (D&TCs), the APG rate for proton therapy services is projected to be approximately $666 per visit on a statewide average basis when APGs are fully implemented – the rate will vary somewhat between upstate and downstate facilities. This rate includes professional services, but does not include ancillary services (e.g., anesthesia, imaging, etc.) or capital.

For hospital outpatient departments or extension clinics, the statewide average per visit rate is projected to be approximately $780 when APGs are fully implemented – the rate will vary somewhat between upstate and downstate. This rate does not include professional services, nor does it include ancillary services (e.g., anesthesia, imaging, etc.) or capital.

New York's APG reimbursement methodology for D&TCs has not yet been approved by the federal government, but a state plan amendment is pending.

For more information about the APG system, see

Question: We are reviewing the application requirements for the demonstration project, and note that the CON application process, in calling for completion of all applicable schedules, would require submittal of Schedule 2 (Personal Qualifying and Disclosure Information, required for all establishment applications).  The schedule calls for highly detailed personal identifying information, including contact information and Social Security numbers.  In the course of discussions here concerns have been raised about the possibility of identity theft, given the visibility of this project and the presence of this information in a publicly filed document.
- Would submittal of Schedule 2 in fact be necessary for this application?
- If so, are there steps DOH would take to ensure the confidentiality of the application materials, particularly with respect to this schedule?

Yes, submission of the Schedule 2 is necessary for this application. Please read the instructions for Schedule 2 carefully and complete the appropriate schedules for the type of entity seeking establishment. Also, please see the clarification below for third parties that will be involved in the operation of the facility, but are not seeking establishment.

The Department routinely collects personal information from individuals who are seeking to acquire an interest in a health care facility or who will participate as stockholders, members, managers, partners, directors, officers, or proprietors of an entity seeking to establish a health care facility. Most personal information (especially sensitive information like social security numbers and financial information) is not subject to disclosure under the Freedom of Information Law and is protected under the Personal Privacy Protection Law.

Department's Clarification Regarding Qualifications of Certain Third Parties

The Demonstration Project Announcement asks applicants to identify and describe the qualifications of third parties that will be involved in the operation of the proposed PBT facility. This question does

Specifically, the Announcement seeks the identity and a description of any individual or entity that will:

  • Have an ownership interest in the premises in which the PBT services will be provided;
  • Have an ownership interest in, and/or maintain, the PBT fixtures and equipment (including but not limited to the PBT accelerator, treatment planning systems, computer technology and beam delivery systems);
  • Provide or arrange administrative or consulting services for the operator.

For purposes of this clarification, these individuals and entities will be referred to as "third parties." The Announcement also asks for "CON Schedule 2 for each director, officer, controlling person, principal stockholder, principal member, manager, partner or sole proprietor of any such third party."

The Department would like to clarify this request. The terms "controlling person, principal stockholder, and principal member" are defined as set forth in section 2801-a of the Public Health Law.

The request for information concerning third parties that will provide or arrange administrative or consulting services for the operator is intended to apply to entities that provide: (1) funds management, billing, collections or bookkeeping and accounting services; (2) human resources, staffing, staff recruitment services; (3) third party payor, insurance or managed care contracting; (4) assistance with policy or procedure development or assistance with development of health facility budgets and budget reports; or (5) any administrative services or medical equipment leases or medical equipment maintenance services provided pursuant to an agreement in which the applicant expects to pay $100,000 or more in any of the first three years of operation.

This request for information is not intended to cover entities providing exclusively legal services or minor services typically provided to health care facilities, such as after-hours answering services, photocopier maintenance, janitorial services or procurement of office supplies, etc.).

For each third party described above, please provide:

  • An organizational chart exhibiting the third party's relationship to all parent, related and subsidiary entities. Describe the nature of each entity (i.e., whether it is a corporation, LLC, partnership, etc.) and the nature of its business.
    • For each entity, identify any criminal actions pending or criminal convictions in past 10 years under state, federal or local law.
    • For each entity, identify any civil or administrative actions initiated by either the Medicare or Medicaid programs against the entity in the past 10 years.
    • Identify any civil fraud actions (including but not limited to violations of the securities laws) in the past ten years.
    • Identify any health care facilities owned, operated or managed by each entity, including the name, address, and type of facility. For each facility operated or managed, identify any enforcement or administrative actions taken by any state or federal regulatory agency in the past 10 years due to the violation of applicable laws or regulations.
    • For each entity, indicate whether it has declared or was forced to declare bankruptcy or was placed in receivership or conservatorship in the past 10 years. Provide the title of the bankruptcy proceeding, court, and index number.
  • Submit Schedule 2A (except question 5(b)) for every individual who is a director, officer, manager (of an LLC), controlling person, principal stockholder/member, partner or sole proprietor of each third-party entity as defined above, and for the parent(s) of the third-party entity. Schedules 2B and 2C are
  • To the extent that the third-party entity is the State, a municipal government, or the federal government, a Schedule 2A is not required for directors and officers of such entity.
  • To the extent that the third-party entity with an ownership interest in, or maintenance agreement with respect to, PBT fixtures or other medical equipment is the manufacturer of such PBT system or other medical equipment, a Schedule 2A is not required for such entity.
  • To the extent that information concerning an entity that will provide administrative or consulting services is supplied through Schedule 3, it need not be duplicated. However, a notation should be made in the application indicating that the information requested is provided in Schedule 3.
  • The Department may request additional information as needed.