(1) A certificate of need may be issued to a hospital or medical assistance facility to establish swing beds only if, in addition to compliance with all other applicable provisions of 50-5-304 , MCA, and ARM 37.106.113:

(a) existing licensed long-term care facilities in the service area, which provide the level of care proposed to be provided by the hospital or medical assistance facility, have an aggregate average occupancy level of at least 95% during the three years prior to the date of the application for certificate of need; and

(b) no more than 50% of the excess bed capacity of the hospital or medical assistance facility will be approved as swing beds. Excess bed capacity is the difference between the number of licensed beds in the facility and the average acute care occupancy level of the facility over the three years prior to the date of the application for certificate of need.

(2) The utilization of swing beds by a medical assistance facility is subject to certificate of need review only if, as required by 50-5-301 (1) (c) , MCA, the facility did not offer long-term care during the 12 months prior to the month the service is scheduled to commence and the service will add annual operating and amortization expenses of $150,000 or more.