§1307. Definitions

            As used in this Part, the following terms shall have the following meanings unless the context requires otherwise:

            (1) "Commercially reasonable terms and conditions" means those terms and conditions that would be reasonable to a prudent individual operating a business of similar type and size as a rural hospital even in the absence of referrals to the rural hospital or healthcare facility by a physician who owns, or whose immediate family member owns, an interest in the healthcare facility in which the rural hospital has been offered the opportunity to participate as an owner. The provisions of 42 U.S.C. 1395nn, also known as "Stark II", the regulations promulgated by the Centers for Medicare and Medicaid Services, its predecessor or successor, to implement Stark II, and any regulatory guidance issued by the Centers for Medicare and Medicaid Services, its predecessor or successor, shall be considered in determining whether terms and conditions are commercially reasonable.

            (2) "Department" means the Louisiana Department of Health.

            (3) "Healthcare facility" means an independent diagnostic testing facility, magnetic resonance imaging equipment or facility, computerized tomography equipment or facility, Positron Emission Tomography scanner or facility, an ambulatory surgical center licensed by the department, or any outpatient surgical facility required to be licensed by the department as an ambulatory surgical center in order to obtain certification by Medicare as an ambulatory surgical center. "Healthcare facility" shall not mean:

            (a) A rural hospital that existed on April 1, 2006, or that replaces a rural hospital that existed on April 1, 2006.

            (b) A rural hospital that is a replacement facility of a rural hospital that was damaged by Hurricane Rita or Hurricane Katrina.

            (c) An entity owned or operated by the state of Louisiana or the United States.

            (d) A physician's practice or a physician group practice, when such practice is owned and operated exclusively by physicians, for the purpose of providing healthcare services, and is not licensed or Medicare-certified as a rural health clinic.

            (e) Any facility under development, including services provided by a mobile unit which is part of an existing facility, as of April 1, 2006, or operating as of April 1, 2006. A facility shall be considered under development if a representative of the facility has, prior to April 1, 2006, filed a license application with the department for the establishment of the proposed healthcare facility, or can demonstrate that a minimum of twenty-five thousand dollars in architectural or engineering expenses have been incurred in connection with the proposed facility prior to April 1, 2006, or has received a certificate of occupancy.

            (f) Any community health care clinic or rural health clinic.

            (4) "Healthcare services" means magnetic resonance imaging services, computerized tomography services, Positron Emission Tomography scanner services, ultrasound services, any other imaging services that have become generally accepted methods of providing imaging services after April 17, 2006, as determined by the department, any services rendered by an ambulatory surgical center licensed by the department, or any services rendered by an outpatient surgical facility required to be licensed by the department as an ambulatory surgical center in order to obtain certification by Medicare as an ambulatory surgical center.

            (5) "Immediate family member" means husband or wife; birth or adoptive parent, child, or sibling; stepparent, stepchild, stepbrother or stepsister; father-in-law, mother-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law; grandparent or grandchild; and spouse of grandparent or grandchild.

            (6) "Primary service area" means the smaller of either a radius of twenty-five miles from the rural hospital main campus or the number of postal zip codes, commencing with the rural hospital's zip code, in which seventy-five percent of a rural hospital's patients reside, as determined by using data derived from the hospital's most recent twelve month Medicare cost reporting period. In determining the primary service area, each outpatient encounter and each inpatient stay shall be viewed as a separate patient, and the zip code attributable to the patient shall be the zip code of the patient at the time of the inpatient stay or outpatient encounter. Notwithstanding any other provision contained herein to the contrary, the term "primary service area" shall not include the cities of Alexandria, Baton Rouge, Bossier City, Covington, Hammond, Houma, Kenner, Lafayette, Lake Charles, Mandeville, Monroe, New Iberia, New Orleans, Opelousas, Ponchatoula, Ruston, Shreveport, Slidell, Thibodaux, or West Monroe.

            (7) "Proposing party" means a person or entity that offers to enter into a joint venture with a rural hospital as well as any person or entity related to the proposing party by common ownership or control as such terms are defined for purposes of 42 CFR 413.17, or its successor provision.

            (8) "Rural hospital" shall be defined as provided for in R.S. 40:1189.3, as such law existed on April 1, 2006.

            Acts 2006, No. 819, §1; Acts 2018, No. 206, §3.