by Brenée Goforth
Communications Associate, John Locke Foundation
This week, Carolina Journal’s Dan Way published a story on a new push to reform Certificate-of-Need (CON) laws. Way reports:
House Bill 126, originally an act to include tissue donation on a driver’s license donor authorization, was changed into a CON reform measure. It was brought up for discussion only.
A CON is essentially a permission slip from the government that medical providers must obtain to begin or expand their practice. These laws were originally intended to keep costs low by preventing providers from buying duplicate machines or expanding too quickly, but in reality, these have raised prices for services by restricting the supply of critical medical equipment and hospital beds. The CON process also adversely affects smaller practices while propping up existing hospitals and providers. Way explains:
Critics say certificates of need issued by state bureaucrats protect existing providers. They keep health-care costs high because incumbent facilities lack competitive pressure. The CON process can be lengthy and expensive. It often involves litigation as newcomers battle entrenched interests wishing to keep them out of the market.
North Carolina is overdue for a change, as the federal government and numerous states have already scrapped CON restrictions after these well-intentioned laws ended up doing more harm than good. Way quotes N.C. Senators Joyce Krawiec and Jim Perry as stating:
“North Carolina is the fourth most restrictive state on CON laws. We have to change them,” said Sen. Joyce Krawiec, R-Forsyth.
“I think it’s important for us all to realize that health care as it exists today must change,” Sen. Jim Perry, R-Wayne, said in supporting CON reform.
The law makes moderate changes to existing CON law. Way explains:
Under H.B. 126, kidney dialysis treatment centers and freestanding hemodialysis units wouldn’t need CON approval.
Intermediate care facilities for people with intellectual disabilities; psychiatric facilities; chemical dependency treatment facilities; and a continuing care retirement community establishing a home health agency to treat residents would be exempt from the rules.
HB 126 is currently in the Senate Committee on Rules and Operations.