Go-To Guide:

• Higher Cost Thresholds for Review: The minimum project costs triggering full, administrative, or limited regulatory review for medical facility construction have been significantly increased—doubling in many cases—streamlining approval for lower-cost or routine projects.
   
• Expanded Expedited/Exempted Projects: More projects now qualify for limited review, written notice only, or are fully exempt from Department review, especially for routine, non-clinical, or infrastructure upgrades under $12 million.
   
• Architectural Self-Certification: Projects up to $30 million can now bypass Department architectural review through self-certification, further accelerating the approval process for qualifying proposals.
   
• Consolidated Applications: Facilities are now required to submit related CON applications together, improving efficiency and reducing administrative burden.

On Aug. 6, 2025, the New York State Department of Health adopted amendments to Certificate of Need (CON) regulations for medical facility construction, raising the financial thresholds that determine which hospital and Article 28-regulated facility projects require state review (10 NYCRR 701.1). These changes are intended to streamline the approval process for routine and non-clinical projects while maintaining oversight of major investments.

These newly adopted regulations are particularly relevant to New York’s general hospitals and other Article 28-regulated facilities seeking to expand and modernize their current infrastructure.

CON Process: Medical Facility Construction Regulations Overview

The Medical Facility Construction CON process applies to new construction, major renovations, and significant equipment purchases at hospitals and Article 28 facilities. It does not apply to changes in ownership or control (such changes are governed separately by the Establishment CON process). Most major projects must be reviewed by the Public Health and Health Planning Council (PHHPC) and approved by the commissioner of Health, though the recent amendments increase the minimum project costs required to trigger each level of regulatory review and approval.

Key Changes to CON Review Thresholds and Processes

Full Review (PHHPC Recommendation and Commissioner Approval Required)

• For general hospitals, full review is now required only for projects costing over $60 million or more than 10% of the hospital’s operating costs (up to $150 million), up from the previous $30 million threshold.
   
• For other Article 28 facilities, the threshold rises to projects over $20 million or 10% of operating costs (up to $30 million), from the previous $15 million.
   
• Full review is also triggered by adding more than 10% to the facility’s bed count; introducing or modifying high-level services (e.g., cardiac surgery or organ transplants); projects exceeding administrative review cost thresholds; or any project recommended for disapproval.

Administrative Review (Commissioner Approval Only)

• For general hospitals, administrative review now applies to projects costing more than $30 million but not exceeding the greater of $60 million or 10% of operating costs (up to $150 million), previously $10 million to $30 million.
   
• For other facilities, the range is now more than $8 million but not exceeding the greater of $20 million or 10% of operating costs (up to $30 million), up from $6 million to $15 million.
   
• Administrative review also applies to state grant-funded projects, adding or converting beds up to 10% of total, temporary bed additions, certain clinic relocations, and adding methadone or chronic renal dialysis programs.

Limited Review (Lower-Cost, Routine Projects; Abbreviated Department Review)

• For general hospitals, limited review covers projects costing $30 million or less, up from $10 million.
   
• For other Article 28 facilities, the threshold is now $8 million or less, up from $6 million.
   
• Limited review applies to proposals such as decertifying beds or services (unless full review is required), adding services not otherwise flagged, converting beds among specified categories, relocating clinics within the same area, and operating or relocating part-time or mobile clinics.

Written Notice Only / No Department Review

• Written notice is required for: correcting deficiencies under a previously Department approved plan, minor repairs or equipment purchases up to $12 million, exam room renovations, discontinuing part-time clinic sites, one-for-one equipment replacement regardless of cost, health IT projects, and limited review-eligible projects qualifying for architectural self-certification.
   
• For non-clinical infrastructure projects (e.g., HVAC, fire alarms, roofs, elevators, parking, dietary, waste/sewage disposal, exterior upgrades), no department review or written notice is required if the cost is $12 million or less.

Architectural Self-Certification

Projects up to $30 million may now use architectural self-certification, eliminating department architectural review for these projects.

Application Consolidation

Facilities must now submit programmatically related CON applications together, rather than separately, to improve review efficiency.

New CON Thresholds: Potential Impact on New York Medical Construction Projects

These amendments double or significantly raise the cost thresholds for each level of review and expand the types of projects eligible for expedited or exempted processes. Article 28 facilities should review the new requirements before starting any construction or renovation project and consult the Department of Health with any questions.