in-20260121-IR-410260014FNA: The Indiana Department of Health (IDOH) is soliciting public comment on amending rules at 410 IAC 15 and 410 IAC 16.2 regarding civil penalties for hospitals, comprehensive care facilities, and residential care facilities. IDOH seeks comment on the affected citations listed and any other provisions of Title 410 that may be affected by this rulemaking.

TITLE 410 INDIANA DEPARTMENT OF HEALTH Notice of First Public Comment Period LSA Document #26-14 CIVIL PENALTIES PURPOSE OF NOTICE The Indiana Department of Health (IDOH) is soliciting public comment on amending rules at 410 IAC 15 and 410 IAC 16.2 regarding civil penalties for hospitals, comprehensive care facilities, and residential care facilities. IDOH seeks comment on the affected citations listed and any other provisions of Title 410 that may be affected by this rulemaking. ADDITIONAL DOCUMENTS Regulatory Analysis: 20260121-IR-410260014RAA Notice of Public Hearing: 20260121-IR-410260014PHA CITATIONS AFFECTED: 410 IAC 15-1.3-3; 410 IAC 16.2-3.1-2; 410 IAC 16.2-5-1.1 AUTHORITY: IC 16-21-1-7; IC 16-28-1-7 OVERVIEW Basic Purpose and Background IDOH regulates hospitals, residential care facilities, and comprehensive care facilities through licensing and enforcement. These three facility types have rules that outline the requirements for licensure and what occurs with a deficiency or noncompliance finding, including corrective action plans and civil penalties. In each of these rules, the civil penalties were outlined as not to exceed specific dollar amounts. The proposed amendments specifically concern civil penalties in each of the respective licensing rules. The proposed rule helps bring those rules into conformity with state law and update the rules to match current operational procedures. IDOH is proposing to add language that will clarify the factors the agency will use to set a specific dollar amount in an individual case with sufficient certainty. The three rules already contain a “not to exceed” amount for civil penalties IDOH may assess, but the addition of the factors will help these entities better understand the factors taken into account for any future penalties. This change is intended to address a state statutory requirement outlined in IC 4-22-2-19.6 for fines, fees, and penalties. When conducting a review of deficiency or noncompliance, IDOH wants to ensure that the statutory mandate of patient health, safety, rights, and welfare are considered first and foremost. Accordingly, the first factor used to assess a civil penalty is how much potential for harm or threat to patient health was caused by the deficiency. Next, IDOH will assess the extent of deviation from the requirement. If the facility is operating mostly in compliance, the resulting penalty would be less. Third, the degree of willfulness or negligence will be reviewed to determine the cost of the penalty. This will require IDOH staff to work with facility staff to determine how aware they were, or should have been, of the requirement that was found noncompliant and determine if the facility willingly chose not to comply. There may be situations where IDOH determines a facility had less of an awareness or was not aware of the requirement and did not intentionally choose noncompliance, based on documentation or conversations with the facility. Finally, IDOH will review if the facility under review has had a previous history of noncompliance, including noncompliance with the requirement being addressed, the amount of time since the last instance of noncompliance, or previous penalties assessed against the facility, or all of these factors. IDOH is also proposing to remove subsections (d) through (h) of the current rule 410 IAC 15-1.3-3. Because IC 4-21.5 applies to this citation, IDOH has no need to convene a panel to review an order issued by an administrative law judge. This will conform the rule to the operational procedures of IDOH. There is no change to the impacted parties under the proposed rule. The parties impacted by the proposed rule amendments are hospitals, residential and comprehensive care facilities, and IDOH staff. These are the same parties already affected by and complying with the current rules. For purposes of IC 4-22-2-28.1, small businesses affected by this rulemaking may contact the Small Business Regulatory Coordinator: For purposes of IC 4-22-2-28.1, the Small Business Ombudsman designated by IC 5-28-17-6 is: Resources available to regulated entities through the small business ombudsman include the ombudsman's duties stated in IC 5-28-17-6, specifically IC 5-28-17-6(9), investigating and attempting to resolve any matter regarding compliance by a small business with a law, rule, or policy administered by a state agency, either as a party to a proceeding or as a mediator. REQUEST FOR PUBLIC COMMENT IDOH is soliciting public comment on the proposed rule. Comments may be submitted in one of the following ways: COMMENT PERIOD DEADLINE All comments must be postmarked or time stamped not later than February 20, 2026. The rule, Regulatory Analysis, appendices referenced in the Regulatory Analysis, and materials incorporated by reference (if applicable) are on file at the Indiana Department of Health, 2 North Meridian Street, Indianapolis, Indiana and are available for public inspection. Copies of the rule, Regulatory Analysis, and appendices referenced in the Regulatory Analysis are available at the Indiana Department of Health office. If IDOH does not receive substantive comments during the public comment period or public hearing, the rule may be adopted with text that is the same as or does not substantially differ from the text of the proposed rule published in this notice. PROPOSED RULE Sec. 3. (a) The commissioner may take any of the following actions on any of the grounds listed in subsection (b): (b) The commissioner may take action under subsection (a) on any of the following grounds: (c) In determining the seriousness of a violation and the specific amount of the civil penalty to be sought for each violation, the commissioner may consider the following: (d) A licensee or an applicant for a license aggrieved by an action under this rule may request review under IC 4-21.5. (c) (d) IC 4-21.5 applies to an action under this section. (e) The Indiana department of health shall appoint an appeals panel consisting of three (3) members as follows: (f) An employee of the department may not be a member of the panel. (g) The panel shall conduct proceedings for review of an order issued by an administrative law judge under this rule. The panel is the ultimate authority under IC 4-21.5. Sec. 2. (a) Any A person, in order to lawfully operate a health facility as defined in IC 16-18-2-167, shall first obtain an authorization to occupy the facility or a license from the director. The applicant shall notify the director, in writing, before the applicant begins to operate a facility that is being purchased or leased from another licensee. Failure to notify the director precludes the issuance of a full license. (b) The director may approve occupancy and use of the a structure pending a final licensure decision. (c) The director may issue a health facility license for a new facility upon receipt, review, and approval of the following requirements: (d) The director may issue a health facility license for an existing facility that proposes a change from a previously approved plan review upon receipt, review, and approval of the following requirements: (e) The director may issue a health facility license for an existing facility that proposes a change in beds upon receipt, review, and approval of the following requirements: (f) The director may issue a health facility license for a facility that has changed ownership upon receipt, review, and approval of the following requirements: (g) The director may issue a provisional license to a new facility or to a facility under new ownership in accordance with IC 16-28-2-4(2). (h) For the renewal of a license, the director may issue a full license for any period up to one (1) year, issue a probationary license, or deny a license application upon receipt and review of the following requirements: (i) If the director issues a probationary license, the license may be granted for a period of three (3) months. However, no not more than three (3) probationary licenses may be issued in a twelve (12) month period. Although the license fee for a full twelve (12) month period has been paid, a new fee shall be is required prior to the issuance of before a probationary license is issued. (j) Any A change in direct or indirect corporate ownership of at least five percent (5%) or more that occurs during the licensure period shall must be reported to the director, in writing, at the time of the change. The facility must shall also provide written notice at the time the change occurs in the officers, directors, agents, or managing employees, or the corporation, association, or other company responsible for the management of managing the facility. (k) For a good cause shown, waiver of any nonstatutory provisions of this rule may be granted by the executive board for a specified period in accordance with IC 16-28-1-10. (l) A licensure survey finding or complaint allegation does not constitute a breach for the purposes of IC 16-28-2 until or unless the commissioner makes a specific determination that a breach has occurred. Moreover, the director shall issue a citation only upon on a determination by the commissioner that a breach has occurred. Regardless of whether the commissioner makes a determination that a breach has occurred, a licensure survey finding or complaint allegation may be used as evidence as to whether a violation actually occurred for the purposes of licensure hearings or any other proceedings initiated under IC 16-28-2 or this article. (m) The classification of rules into the categories that are stated at the end of each section of this rule and 410 IAC 16.2-5 through 410 IAC 16.2-7 shall be are used to determine the corrective actions and penalties, if appropriate, to be imposed by the commissioner upon on a determination that a breach has occurred, as follows: (n) For Medicare or Medicaid certified facilities, or both, the department shall not collect both a civil money penalty under 42 CFR 488 and a fine under IC 16-28 and this article. (n) In determining the seriousness of a violation and the specific amount of the civil penalty to be sought for each violation, the department may consider the following: (o) For Medicare or Medicaid certified facilities, or both, the department may not collect both a civil money penalty under 42 CFR 488 and a fine under IC 16-28 and this article. Sec. 1.1. (a) Any A person, in order to lawfully operate a health facility as defined in IC 16-18-2-167, shall first obtain an authorization to occupy the facility or a license from the director. The applicant shall notify the director, in writing, before the applicant begins to operate a facility that is being purchased or leased from another licensee. Failure to notify the director precludes the issuance of a full license. (b) The director may approve occupancy and use of the a structure pending a final licensure decision. (c) The director may issue a health facility license for a new facility upon receipt, review, and approval of the following requirements: (d) The director may issue a health facility license for an existing facility that proposes a change from a previously approved plan review upon receipt, review, and approval of the following requirements: (e) The director may issue a health facility license for an existing facility that proposes a change in beds upon receipt, review, and approval of the following requirements: (f) The director may issue a health facility license for a facility that has changed ownership upon receipt, review, and approval of the following requirements: (g) The director may issue a provisional license to a new facility or to a facility under new ownership in accordance with IC 16-28-2-4(2). (h) For the renewal of a license, the director may issue a full license for any period up to one (1) year, issue a probationary license, or deny a license application upon receipt and review of the following requirements: (i) If the director issues a probationary license, the license may be granted for a period of three (3) months. However, no not more than three (3) probationary licenses may be issued in a twelve (12) month period. Although the license fee for a full twelve (12) month period has been paid, a new fee shall be is required prior to the issuance of before a probationary license is issued. (j) Any A change in direct or indirect corporate ownership of at least five percent (5%) or more that occurs during the licensure period shall must be reported to the director, in writing, at the time of the change. The facility must shall also provide written notice at the time the change occurs in the officers, directors, agents, or managing employees, or the corporation, association, or other company responsible for the management of managing the facility. (k) For a good cause shown, waiver of any nonstatutory provisions of this rule may be granted by the executive board for a specified period in accordance with IC 16-28-1-10. (l) A licensure survey finding or complaint allegation does not constitute a breach for the purposes of IC 16-28-2 until or unless the commissioner makes a specific determination that a breach has occurred. Moreover, the director shall issue a citation only upon on a determination by the commissioner that a breach has occurred. Regardless of whether the commissioner makes a determination that a breach has occurred, a licensure survey finding or complaint allegation may be used as evidence as to whether a violation actually occurred for the purposes of licensure hearings or any other proceedings initiated under IC 16-28-2 or this article. (m) The classification of rules into the categories that are stated at the end of each section of this rule and 410 IAC 16.2-6 through 410 IAC 16.2-7 shall be are used to determine the corrective actions and penalties, if appropriate, to be imposed by the commissioner upon on a determination that a breach has occurred as follows: (n) In determining the seriousness of a violation and the specific amount of the civil penalty to be sought for each violation, the department may consider the following: