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Secretary of the Treasury; except that if the Surgeon General, after investigation or otherwise, has ground to believe that a default has occurred requiring action pursuant to section 632 (a) he may, upon giving notice of hearing pursuant to such subsection, withhold certification pending action based on such hearing. 1

(c) Amendment of any approved application shall be subject to approval in the same manner as an original application. Certification under subsection (b) may be amended, either upon approval of an amendment of the application or upon revision of the estimated cost of a project. An amended certification may direct that any additional payment be made from the applicable allotment for the fiscal year in which such amended certification is made.

(d) The funds paid under this section for the construction of an approved project shall be used solely for carrying out such project as so approved.

(e) If any hospital, diagnostic or treatment center, rehabilitation facility, or nursing home for which funds have been paid under this section or under section 654 shall, at any time within twenty years after the completion of construction, (A) be sold or transferred to any person, agency, or organization, (1) which is not qualified to file an application under this section, or (2) which is not approved as a transferee by the State agency designated pursuant to section 623 (a) (1), or its successor, or (B)

to be a nonprofit hospital, nonprofit diagnostic or treatment center, nonprofit rehabilitation facility, or nonprofit nursing home as defined in section 631 (8), the United States shall be entitled to recover from either the transferor or the transferee (or, in the case of a hospital, diagnostic or treatment center, rehabilitation facility, or nursing home, which has ceased to be nonprofit, from the owners thereof) an amount bearing the same ratio to the then value (as determined by agreement of the parties or by action brought in the district court of the United States for the district in which such hospital, center, facility, or nursing home is situated) of so much of the hospital, center, facility, or nursing home as constituted an approved project or projects, as the amount of the Federal participation bore to the cost of the construction of such project or projects.2/

(f) If the Surgeon General finds with respect to an application for a hospital project that--

(1) the project is for the completion of a hospital the construction of which was commenced prior to the effective date of this subsection and without Federal aid under this title;

(2) completion of construction is necessary for use of the completed portion as a hospital;

(3) the State agency has certified that the applicant is unable, by use of all available funds and by exercise of reasonable effort in obtaining additional funds, to pay the non-Federal share (determined without regard to this subsection) of the cost of completing the hospital but will be able to complete construction with the additional Federal aid provided by this subsection;

(4) the plans and specifications for the entire hospital are in accord with the regulations prescribed pursuant to section 622, or if not in accord with such regulations, meet substantially the objectives of such regulations;

(5) the application meets all the requirements of subsection (a) of this section except in the respects covered by clauses (3) and (4) hereof and contains assurances applicable to the operation and maintenance of the entire hospital which meet the requirements of such subsection; and

(6) the unobligated balance of the sum allotted to the State is equal to or greater than the Federal share of the estimated cost of construction of such

project plus the additional amount specified below in this subsection; he shall approve the application. Upon such approval the Federal share of the estimated cost of such project plus an additional amount not to exceed (1) 33 1/3 per centum of the necessary cost to the applicant of the construction completed prior to such approval, or (2) the amount certified by the State agency as necessary to complete the construction of the hospital, whichever is less, shall constitute a contractual obligation of the Federal Government, and certifications for payment under subsection (b) of this section shall be on the basis of the Federal share plus such additional amount: PROVIDED, That the total amount certified for payment shall not exceed the cost of construction of such project. B

1) Subsection (0) was estended by section 3(6) of the Hospital Survey and Construc

tion Amendments of 1949. 2) Subsection (e ) was a me nded by section 4 (b) of the Medical Facilities Survey and Con

struction Act of 1954 . '3 Subsection (f) was added by section 3(d) of the Hospital Survey and Construction

Amendments of 1949.

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Sec. 631. For the purpose of this title-

(a) the allotment percentage for any State shall be 100 per centum less that percentage which bears the same ratio to 50 per centum as the per capita income of such State bears to the per capita income of the continental United States (excluding Alaska), except that (1) the allotment percentage shall in no case be more than 75 per centum or less than 33 1/3 per centum, and (2) the allotment percentage for Alaska and Hawaii shall be 50 per centum each, and the allotment percentage for Puerto Rico, Guam, and the Virgin Islands shall be 75 per centum; 1/.

(b) the allotment percentages shall be promulgated by the Surgeon General between July 1 and August 31 of each even-numbered year, on the basis of the average of the per capita incomes of the States and of the continental United States for the three most recent consecutive years for which satisfactory data are available from the Department of Commerce. Such promulgation shall be conclusive for each of the two fiscal years in the period beginning July 1 next succeeding such promulgation: PROVIDED, That the Surgeon General shall promulgate such percentages as soon as possible after the enactment of this title, which promulgation shall be conclusive for the fiscal year ending June 30, 1947;

(c) The population of the several States shall be determined on the basis of the latest figures certified by the Department of Commerce;

(d) the term "State" includes Alaska, Hawaii, Puerto Rico, Guam, the Virgin Islands and the District of Columbia; 1/

(e) the term "hospital" (except as used in section 622 (a) and (b)) includes public health centers and general, tuberculosis, mental, chronic disease, and other types of hospitals, and related facilities, such as laboratories, out-patient departments, nurses' home and training facilities, and central service facilities operated in connection with hospitals, but does not include any hospital furnishing primarily domiciliary care;

(f) the term "public health center" means a publicly owned facility for the provision of public health services, including related facilities such as laboratories, clinics, and administrative offices operated in connection with public health centers:

(8) The terms 'nonprofit hospital,' 'nonprofit diagnostic or treatment center', 'nonprofit rehabilitation facility', and 'nonprofit nursing home' mean any hospital, diagnostic or treatment center, rehabilitation facility, and nursing home, as the case may be, which is owned and operated by one or more nonprofit corporations or associations no part of the net earnings of which inures, or may lawfully inure, to the benefit of any private shareholder or individual; ?'

(h) The term 'construction includes construction of new buildings, expansion, remodeling, and alteration of existing buildings, and initial equipment of any such buildings (including medical transportation facilities): including architects fees, but excluding the cost of off-site improvements rand, except with respect to public health centers, the cost of the acquisition of land; 2/

(i) the term "cost of construction" means the amount found by the Surgeon General to be necessary for the construction of a project.

(j) the term "title", when used with reference to a site for a project, means a fee simple, or such other estate or interest (including a leasehold on which the rental does not exceed 4 per centum of the value of the land) as the Surgeon General firds sufficient to assure for a period of not less than fifty years undisturbed use and possession for the purposes of construction and operation of the project;

(k) (1) The term 'Federal share with respect to any project means the proportion of the cost of construction of such project to be paid by the Federal Government. In the case of any project approved prior to October 25, 1949, the Federal share shall be 33 1/3 per centum of the cost of construction of such project. In the case of any project approved on or after October 25, 1949, the Federal share, except as otherwise provided in paragraph (2) of this subsection, shall be determined as follows -

1/ Subsections (a) and (d) were amended by sections 19(a) and (b) of PL 896, 84th Congress,

to include Guan. 2/ Subsections (8) and (h) were a me nded by sections 4(c) and (d) of the Medical Facilities

Survey and Construction Act of 1954 .

(A) if the State plan, as of the date of approval of the project application, contains standards approved by the Surgeon General pursuant to section 623 (e), the Federal share with respect to such project shall be determined by the State agency in accordance with such standards;

(B) if the State plan does not contain such standards, the Federal share shall be the amount (not less than 33 1/3 per centum and not more than either 66 2/3 per centum or the State's allotment percentage, whichever is the lower) established by the State agency for all projects in the State: PROVIDED, That prior to the approval of the first project in the State during any fiscal year the State agency shall give to the Surgeon General written notification of the Federal share established under this subparagraph for projects in such State to be approved by the Surgeon General during such fiscal year, and the Federal share for projects in such State approved during such fiscal year shall not be changed after such approval.

(2) in tne case of projects eligible for approval under part G and approved after the effective date of that part, the Federal share shall be determined as provided in paragraph (1) of this subsection, or, if the State so efects, shall be. 50 per centum of the cost of construction of the project: Provided, That prior to the approval of the first such project in the State during any fiscal year, the State agency shall give to the Surgeon General written notification of such election; and such election shall not be subject to change during such fiscal year after such approval.

(1) The term 'diagnostic or treatment center' means a facility for the diagnosis or diagnosis and treatment of ambulatory patients..

(1) which is operated in connection with a hospital, or

(23 in which patient care is under the professional supervision of persons Licensed' to practice medicine or surgery in the State, or, in the case of dental diagnosis of treatment, under the professional supervision of persons licensed to practice dentistry in the State. 21

(m) The term 'hospital for the chronically ill and impaired shall not include any hospital primarily for the care and treatment of mentally ill or tuberculous patients. 21

(n) The term 'rehabilitation facility' me ans, a facility which is operated for the primary purpose of assisting in the rehabilitation of disabled persons through an integrated program of medical, psychological, social, and vocational evaluation and services under competent professional supervision, and in the case of which..

(1), the major portion of such evaluation and services is furnished within the facility; and

(2) either (A) the facility is operated in connection with a hospital, or (B) all medical and related health services are prescribed by, or are under the general direction of, persons licensed to practice medicine or surgery in the State. 21

(0) Thë term 'nursing home' means a facility for the accommodation of convalescents or other persons who are not acutely ill and not in need of hospital care, but who require skilled nursing care and related medical services-

(1) which is operated in connection with a hospital, or

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(2) in which such nursing care and medical services are prescribed by, or are per formed under the general direction of, persons licensed to practice medicine or surgery in the State. ?!

Withholding of Certification Sec. 632. (a) Whenever the Surgeon General, after reasonable notice and oppor. tunity for hearing to the State agency designated in accordance with section 612 (a) (1), or section 647 (1) finds that the State agency is not complying substantially with the provisions required by section 612_(a) or section 647 to be contained in its application for funds under part B or part F. as the case may be, or after reasonable notice and opportunity for hearing to the State agency designated in accordance with section 623 (a).(1) or section 647 (1) finds (1) that the State agency is not complying substantially with the provisions required by section 623 (a), or by regulations prescribed pursuant to section 622, or with the provisions required by section 647, or by regulations prescribed pursuant to section 653, to be contained in its plan submitted under section 623 (a) or section 653, as the case may be, or (?) that any funds have been diverted from the purposes for which they have been allotted' or paid, or (3) that any assurance given in an application filed under section 625 or section 654, `aś the case may be, is not being or cannot be carried out, or (4) that there is a substantial failure to carry out plans and specifications approved by the Surgeon General under section 625 or section 654, as the case may be, or (5) that adequate State funds are not being provided annually for the direct administration of the State plan, the Surgeon General may for thwith notify the Secretary of the Treasury and the State agency that no further certification will be made under part B, part c, part F, or part G, as the case may be, or that no further certification will be made for any project or projects designated by the Surgeon General as being affected by the de fauit, as the Surgeon General may determine to be appropriate under the circumstances; and, except with regard to any project for which the application has already been approved and which is not directly affected by such de fault, he may withhold further certifications until there is no longer any failure to comply, or, if compliance is impossible, until the State repays or arranges for the repayment of Federal moneys which have been diverted or improperly expended. 3

42 USC 291j

1/ Subsection Ik) was amended by section 4(e) of the Medical facilities Survey and Construction

Act of 1954. 21 Subsections (!),(m), in, and lol were added by section 41f) of the Medical Facilities Survey

and Construction Act of 1954. 3! Subsection 632 (a) was amended by section 4 (g) of the Medical Facilities Survey and Construction

Act of 1954.

(b) (1) If the Surgeon General refuses to approve any application under section 625 or section 654, the State agency through which the application was submitted, or if any State is dissatisfied with the Surgeon General's action under subsection (a) of this section, such State may appeal to the United States circuit court of appeals for the circuit in which such State is located. The summons and notice of appeal may be served at any place in the United States. The Surgeon General shall forthwith certify and file in the court the transcript of the proceedings and the record on which he based his action. !!

(2) The findings of fact by the Surgeon General, unless substantially contrary to the weight of the evidence, shall be conclusive; but the court, for good cause shown, may remand the case to the Surgeon General to take further evidence, and the Surgeon General may thereupon make new or modified findings of fact and may modify his previous action, and shall certify to the court the transcript and record of the further proceedings. Such new or modified findings of fact shall likewise be conclusive unless substantially contrary to the weight of the evidence.

(3) The court shall have jurisdiction to affirm the action of the Surgeon General or to set it aside, in whole or in part. The judgment of the court shall be subject to review by the Supreme Court of the United States upon certiorari or certification as provided in sections 239 and 240 of the Judicial Code, as amended.

Federal Huspital Council; Administration of Title

42 USC 2915

Sec. 633. (a) The Surgeon General is authorized to make such administrative regulations and perform such other functions as he finds necessary to carry out the provisions of this title. Any such regulations shall be subject to the approval of the Administrator.

(b) In administering this title, the Surgeon General shall consult with a Federal Hospital Council consisting of the Surgeon General, who shall serve as Chairman ex officio, and eight members appointed by the Administrator. Four of the eight appointed members shall be persons who are outstanding in fields pertaining to hospital and health activities, three of whom shall be authorities in matters relating to the operation of hospitals, and the other four members shall be appointed to represent the consumers of hospital services and shall be persons familiar with the need for hospital services in urban or rural areas. Each appointed member shall hold office for a term of four years, except that any member appointed to fill a vacancy occurring prior to the expiration of the term for which his predecessor was appointed shall be appointed for the remainder of such term, and the terms of office of the members first taking office shall expire, as designated by the Administrator at the time of appointment, two at the end of the first year, two at the end of the second year, two at the end of the third year, and two at the end of the fourth year after the date of appointment. An appointed member shall not be eligible to serve continuously for more than two terms but shall be eligible for reappointment if he has not served immediately preceding his reappointment. The Council is authorized to appoint such special advisory and technical committees as may be useful in carrying out its functions. Appointed Council members and members of advisory or technical committees, while serving on business of the Council, shall receive compensation at rates fixed by the Administrator, but not exceeding $50 2' per day, and sh also be entitled to receive an allowance for actual and necessary travel and subsistence expenses while so serving away from their places of residence. The Council shall meet as frequently as the Surgeon General deems necessary, but not less than once each year. Upon request by three or more members, it shall be the duty of the Surgeon General to call a meeting of the Council.

(c) In administering the provisions of this title, the Surgeon General, with the approval of the Administrator, is authorized to utilize the services and facilities of any executive department ir. accordance with an agreement with the head thereof. Payment for such services and facilities shall be made in advance or by way of reimbursement, as may be agreed upon between the Administrator and the head of the executive department furnishing them.

ļ/ Subsection 632(b)(1) was amended by section 4(8) of the Medical Facilities Survey and Construc

tion Act of 1954. 2/ Subsection 633(b) was amended by section 6(c) of the National Dental Research Act.

Conferences of State Agencies

42 USC 2911

Sec. 634. Whenever in his opinion the purposes of this title would be promoted by a conference, the Surgeon General may invite representatives of as many State agencies, designated in accordance with section 612 (a) (1) or section 623 (a) (1), to confer as he deems necessary or proper. Upon the application of five or more of such State agencies, it shall be the duty of the Surgeon General to call a conference of representatives of all State agencies joining in the request. A conference of the representatives of all such State agencies shall be called annually by the Surgeon General.

State Control of Operations

42 USC 291m

Except as otherwise specifically provided, nothing in this title shall be construed as conferring on any Federal officer or employee the right to exercise any supervision or control over the administration, personnel, maintenance, or operation of any hospital, diagnostic or treatment center, rehabilitation facility, or nursing home with respect to which any funds have been or may be expended under this title. V

Studies and Demonstrations Relating to Coordinated Use of Hospital Facilities

42 USC 2916

Sec. 636. In carrying out the purposes of section 301 with respect to hospital facilities, the Surgeon Generalis authorized to conduct research, experiments, and demonstrations relating to the effective development and utilization of hospital services, facilities, and resources, and, after consultation with the Federal Hospital Council, to make grants-in-aid to States, political subdivisions, universities, hospitals, and other public and private nonprofit institutions or organizations for projects for the conduct of research, experiments, or demonstrations relating to the development, utilization, and coordination of hospital services, facilities, and resources. Any award made under this section for any such project in any fiscal year may include amounts for not to exceed the four succeeding fiscal years, and such amounts for such succeedingfiscal years shall constitute contractual obligations of the Federal Government: PROVIDED, That the total expenditures for all such projects may not exceed $1, 200,000 in any fiscal year. 23

1/ Section 635 was a mended by section 4(h) of the Medical Facilities Survey and Construction

Act of 1954 2/ Section 636 was added by section 5 of the Hospital Survey and Construction Amend me nts of

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