2.__Purpose.__The purpose of the plan is to promote the effective, efficient and rational expenditure of limited financial resources in a manner that preserves access to critical, primary and preventive services for rural and vulnerable residents of this State.__To achieve this goal, otherwise competing entities must collaborate to develop a coordinated plan to restructure the hospital system of this State to provide the highest quality care in the most efficient manner. The plan must inform the certificate of need process and the development of the State Health Plan in Title 2, section 101.

3.__Statewide hospital expenditures.__The level of statewide hospital expenditures to be allocated by the plan must equal that portion of personal health care expenditures in this State attributable to inpatient and outpatient hospital care in the most recent 12-month period for which auditable data are available, adjusted forward to the plan year by the Consumer Price Index for each intervening time period.__For purposes of developing the first plan, 1999 hospital expenditures must be used as a basis for calculating the target level of statewide hospital expenditures.__The expenditure level for the most recent year for which audited hospital data are available must be used, adjusted forward to state fiscal year 2005 by the appropriate values for the Hospital Cost Index developed by the federal Centers for Medicare and Medicaid Services.__This adjusted expenditure level is equal to the amount to be allocated under the plan.

4.__Working group.__The Governor shall annually convene a working group to develop a proposed plan pursuant to this subsection.

A.__The working group comprises representatives of a statewide hospital association, a statewide medical association, a statewide osteopathic association and representatives of the Governor's Office of Health Policy and Finance or its successor.__The Governor shall designate the chair of the working group.__The State Government shall actively participate in the development of the proposed plan.__The Governor shall convene the first working group no later than November 1, 2003.

B.__The members of the working group shall develop a proposed plan for the hospital system in this State that satisfies the following criteria: