On December 1, 2025, the New York State Department of Health, Division of Hospitals and Diagnostic and Treatment Centers, issued revised guidance on proposing and implementing both temporary and permanent hospital closures, addressing complete facility closures, as well as the closure of beds and service lines (“2025 Guidance”), which supersedes the guidance issued on August 29, 2023.
New York State regulations requires a “facility”, which, for purposes of the 2025 Guidance includes hospitals, diagnostic and treatment centers, end-stage renal disease facilities, midwifery birthing centers and ambulatory surgery centers, to submit “…proposed changes in physical plant, bed capacity and the extent and kind of services provided…” to the NYS Department of Health (the “Department”) for prior review and approval. In addition, the regulations require that operators of such facilities must secure the prior written approval of the Department before reducing its certified bed capacity by, among other things, showing satisfactory cause for the requested reduction and a commitment and ability to maintain its licensed services for the reduced number of patients. Finally, facilities are precluded from discontinuing operation or surrendering their operating certificates unless the Commissioner of Health is given advance notice and issues his or her written approval.
Complaints about the complexity and timeliness (or lack thereof) of this process increased in June 2023, when a new law required that a “Health Equity Impact Assessment” or “HEIA” be filed, along with every filing for (among other things) a change in service of New York-licensed health care facilities, providing information on whether the proposed project would impact the delivery of, or access to, services in the facilities’ service areas, particularly medically underserved groups. As hospitals and diagnostic and treatment centers are exempted from some of the more onerous HEIA requirements when filing certain kinds of CON applications, the HEIA requirement criteria should be carefully reviewed before proceeding.
Most importantly, the new guidance allows the Department to consider the impact of the proposed changes on quality of care and patient safety during the closure plan process and may, “at its discretion,” give prior written approval for the applicant facility to proceed with certain discrete steps included in its closure plan prior to approving the entire CON application itself. This reflects the Department’s acknowledgement, at least, that in the current economic and technological environment, changes in the health care industry move much faster than the gears of government sometimes do.
The new guidance establishes separate processes for temporary closures (up to 60 days’ duration) and non-temporary closures (closures that are expected to extend beyond 60 days or are intended to be permanent). Temporary closures require verbal and written notice be given to the Hospital Program Director in the applicable Departmental Regional Office (“Regional Program Director”), with written notice being provided within 48 hours of verbal notice. Verbal notice must be given “…as soon as [the] facility contemplates temporary cessation, pause or limitation of a service or reduction in the number of beds.” For temporary closures, the applicant facility must provide proof of a surety bond, the proceeds of which are forfeited to the lowest level of government where the facility is located, if the temporarily-closed services are not reinstated within 60 days. In addition, the facility must ensure that the community it serves continues to have access to needed health care services and posts such information on its website. It is unclear when and how the Department’s “approval” will be communicated to the applicant facility.
For non-temporary or permanent closures, the same verbal and written notice requirements apply; however, in addition to written notice being given within 48 hours of the verbal notice, it must also be given not less than 90 days in advance of the proposed closure. In light of all that needs to be accomplished before Department approval will be issued, the 90-day advance notice is not likely to be an issue.
Facilities applying for approval of non-temporary or permanent closures must alert the public, physicians, and staff of their intent to seek such approval, and must hold a public meeting at which its closure plan will be discussed. The meeting notice must be issued at least 10 days in advance of the meeting (such notice to also be provided to the Department), and all affected elected officials, as well as community members (including union officials, health care providers and local authorities), must be invited to attend. The location of the meeting must be within reasonably proximity to the affected facility and accessible to those with disabilities, and both in-person and virtual attendance must be afforded. The applicant facility’s chief executive officer or chief operating officer must attend and answer questions. Participants must be afforded reasonable opportunities to speak at the meeting, and written comments sent by mail or electronic mail within one week following the meeting must be accepted by both the Department and the facility.
A detailed written closure plan must be submitted to the Regional Program Director via email. While in large measure, the 2025 Guidance on the written closure plan itself is materially the same as the guidance issued in 2023, the following differences are included in the new guidance:
- Rather than a general comment, the 2025 Guidance requires, as an element of the written closure plan for facilities that include closure of psychiatric or substance use disorder beds or services, inclusion of evidence and a summary of the facility’s discussion with the New York Office of Mental Health and the New York State Office of Addiction Services and Supports.
- The written closure plan must include a plan to manage media contacts, both initially and throughout the process. In addition, all media releases must be coordinated with the Department prior to release of such notices.
- The written closure plan must include a plan for the storage and safekeeping of stained slides and paraffin blocks.
A closure plan is not approved until the Department issues a formal written approval thereof; verbal notifications or indications of approval are not binding. The facility must also notify patients, contracted services, staff, other agencies, and managed care programs immediately upon its receipt of the Department’s formal written approval. If permanently closing, a facility must surrender its operating certificate to the Regional Program Director on its last day of operation.
It is noted in the 2025 Guidance that for services or beds that have not been operational for seven years or more, a more discrete written notice to the Regional Program Director and posting on facility’s main website for 90 days is required, but it does not explicitly state that all of the aforementioned procedures are dispensed with (although this seem to be what is implied).
Facilities should be aware that, in addition to the return of the unapproved closure plan for failure to follow the closure plan process or meet the requirements, penalties may also be assessed by the Department. Such penalties may include administrative fines or actions related to license, certification or designation.
Finally, the 2025 Guidance reiterates that required Health Equity Impact Assessments are still required as part of CON applications per the 2023 law.
link