Several state Senate bills have been filed to repeal or limit Certificate of Need (CON) laws in the state, opening up the medical field in the state to more of a free-market approach, as opposed to state government allowing or prohibiting new and expanded medical services across the state.
Currently state law requires a certificate of need for many new medical providers to open up a hospital, for instance, or for existing providers to implement new or expanded services, such as adding additional radiology machines.
CON laws were implemented with the intention of keeping health care providers from over-building their facilities past the capacity need for their area and placing the cost of paying for the facility on their patients, but critics say that the laws provide a barrier of entry to new healthcare facilities, thus keeping competition low and prices high.
In recent years a push has arisen to remove CON laws in North Carolina as many states already have.
Sens. Ralph Hise (R-Madison) and Trudy Wade (R-Guilford) filed a bill Tuesday that would include a clean repeal of CON laws in the state. Their bill, SB324, would delete Article 9 of Chapter 131E of the North Carolina General Statutes, as well as removing other portions of the law and references to the CON law process.
The bill has been placed in the Senate Rules Committee and is awaiting a referral.
Of the bill Hise said, “CON [law] is one more example of government overreach that may be well-intended, but in reality only serves to curb patient choices and drive up the already spiraling cost of health care. I’m pleased to join my Senate colleagues in working toward a solution that spurs more competition, lowers costs and puts patients first.”
A Wednesday release from Senate Leader Sen. Phil Berger’s (R-Rockingham) office said that the push to repeal, and reduce, CON laws is a money-saving venture for the citizens of the state.
“Currently, North Carolina’s CON laws discourage competition and drive up costs by forbidding health care providers from performing many medical services, building new facilities or even buying or replacing their own equipment without approval from state regulators,” the release said. “The laws are among the most restrictive in the entire country, regulating dozens of services and procedures. And studies have pointed to CON restrictions leading in part to thousands fewer patient beds in the state, along with fewer MRI machines and CT scanners.”
Other bills filed in regards to CON laws include a bill by Sens. Norman Sanderson (R-Carteret) and Louis Pate (R-Wayne) to exempt ophthalmologists performing office-based cataracts surgery from CON law, a bill from Sen. Harry Brown (R-Jones) that would exempt inpatient hospice facilities from CON law, and also a bill from Sen. Tommy Tucker (R-Union) that would also exempt certain ophthalmologists from CON law requirements.
The rise of CON laws came in the 1960s as a guard against increasing health care costs, with New York becoming the first state to pass such measures in 1964.
In 1974 a federal law tied federal funding for states to putting in place CON laws and over the next few years every state but Louisiana had enacted the laws.
In 1987 the federal mandate requiring CON laws, and the funding that came with it, was repealed.
Over the past 30,years, 14 states have repealed their CON law requirements, with New Hampshire being the most recent state to repeal its CON laws, in 2016.