While the main budgetary sticking point between the House and Senate is their differences on tax reform, there’s an important issue that could go a long way toward making healthcare more affordable for North Carolinians that is getting virtually no attention.
Certificate of Need (CON) laws require medical care providers to get permission from a government commission to expand or acquire new equipment to treat more patients. This archaic law artificially limits the availability of treatment and care, in turn driving up costs.
North Carolina is one of 35 states still imposing CON laws, and is considered to be one of the nation’s most restrictive CON regimes, with dozens of facilities, equipment, and services covered.
Research has shown that CON laws increase healthcare costs, as much as 5 percent for physician care. The price increases are driven by limited supply. More specifically, a 2021 report released by the Locke Foundation found that CON is associated with 30 percent fewer hospitals per capita, 13 percent fewer hospital beds, and 14 percent longer emergency room wait times.
Recently, as reported by the Carolina Journal, a total of 11 surgical procedure rooms and 176 acute care beds being requested by providers in Wake County were denied. As quickly as Wake County is growing, it is disconcerting to see willing medical care providers denied the chance to expand access to care.
And there’s also the practice of medical providers being awarded the right to expand facilities or equipment only to not make the approved investment. They do this to exclude their competitors from doing so, in order to keep supply limited and drive up costs to pad their profits.
The Senate’s budget proposal would completely eliminate North Carolina’s CON laws, while the House budget plan includes no action on CON laws.
Repealing North Carolina’s CON laws would reduce healthcare costs while expanding much-needed access to care for more patients. While most of the focus in the budget debate is on tax reform, let’s hope budget writers also prioritize making healthcare more affordable and accessible for North Carolinians.
