There are several bills filed in the legislature that would limit or outright repeal certificate-of-need 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.
But most seem to be moving slowly if at all, at a time when legislation in the General Assembly needs to be making substantial progress if it is to be passed this session.
The legislation ranges from such drastic changes as effecting a full repeal of certificate of need (CON) laws, as in SB324, filed by Sens. Ralph Hise (R-Madison) and Trudy Wade (R-Guilford), to legislation that would only exempt certain ocular surgeries from CON laws, such as SB349, filed by Sen. Tommy Tucker (R-Union).
Both bills have companion legislation in the House as well.
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 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.
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 was placed in the Senate Rules Committee March 22 and has remained there ever since.
Its companion bill, HB640, filed by Rep. Beverly Boswell (R-Beaufort), was placed in the House Committee on Health on April 10 and has serial referrals to Insurance and Judiciary if it makes it through Health.
The bill, however, would need to make it through those three committees and to the House floor, and be approved in two votes, all before April 27th to make the crossover deadline.
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.”
SB349 is sharing space in the Rules Committee with SB324, along with SB328, filed by Sens. Norman Sanderson (R-Carteret) and Louis Pate (R-Wayne), to exempt ophthalmologists performing office-based cataracts surgery from CON law, and SB330, a from Sen. Harry Brown (R-Jones) that would exempt inpatient hospice facilities from CON law.
The Senate Rules Committee is known as a graveyard for legislation. The presence of CON bills there is seemingly at odds with past comments from Senate President Pro Tem Sen. Phil Berger (R-Rockingham) on the matter.
In a release from March, Berger showed support for CON law repeal, calling it 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,” Berger said in a release. “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.”
Berger’s placement of the bills in Rules may be more than it seems at this point in the session, but with crossover approaching quickly, anything that is going to happen with CON law probably needs to happen soon.
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 do so, in 2016.