John Locke Update / Research Brief

Health care deregulation should be permanent

posted on in COVID-19 Series, Health Care, Health Care & Human Services
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The North Carolina’s response to coronavirus continues as the state remains under a stay-at-home order. No one knows how long the stay-at-home orders will stay in effect or how long this virus will spread. But one thing is certain. Deregulatory actions taken by the government have helped the country respond to the coronavirus pandemic.

The deregulation effort is evident in the actions of federal, state, and local governments. The Centers for Medicare and Medicaid Services has rolled back several regulations concerning medical licensure, telemedicine, and other services in the Medicare and Medicaid programs. State governments have also waived similar regulations limiting access to care and crippling the ability of health professionals to practice.

Early in the pandemic response, the John Locke Foundation released several recommendations for state officials and state legislators to consider as they respond to the virus. I offered some health care policy changes the state could make to increase access for patients, provide additional flexibility to the health care system, and better utilize the health care professionals and infrastructure we currently have in place.

I’m pleased that Gov. Cooper implemented almost all of the John Locke Foundation’s health policy recommendations through several executive orders. The most recent executive order signed on April 8 waived several regulations that would hinder the coronavirus response while simultaneously making it easier for patients to seek care from health professionals. In this research update, I will highlight some of the health policies the recent executive order changed.

Hospital and Provider Capacity

Gov. Cooper’s executive order builds on prior action by the governor concerning certificate of need (CON) regulations. The Department of Health and Human Services’ Division of Health Service Regulation recently sent guidance to the CEOs of hospitals to increase acute bed capacity by obtaining written permission from the state rather than undergoing the full process by the State Health Coordinating Council. This EO further spells out how hospitals can increase bed capacity and relocate beds to other facilities. Also, hospitals and kidney disease treatment centers can now add or relocate dialysis machines. Similarly, hospitals can temporarily acquire medical imaging equipment.

The EO also allows for ambulatory surgery centers to register as a hospital temporarily. ASCs will need to receive written permission for this to happen. This move will increase the state’s bed capacity and further decrease pressure on some health care systems that may experience an abundance of cases in their area.

One can’t help but wonder how many resources were used to get these CON restrictions waived. The John Locke Foundation has long believed that the state shouldn’t be involved in regulating the supply of health care in the state. But after a pandemic forced the state to waive these laws to allow hospitals and other providers to respond without running afoul of the law, should these laws continue after the pandemic?

The goal of CON laws is to ensure an adequate amount of health care supply in a community and keep health care inflation low. Can anyone honestly say they are accomplishing those goals? These laws should remain waived indefinitely, and the General Assembly should seriously consider removing the state from the regulation of health care supply and leaving it to the private market. 

Health Care Workforce

In a previous executive order, Gov. Cooper recognized out-of-state licenses for health care professionals who are licensed in another state. Before that, a provider without a North Carolina license who wished to practice in the state would need to obtain a North Carolina license first, despite holding another state’s license. Cooper’s latest EO further increases the health care workforce by allowing health care licensure boards to reinstate those who are retired or have inactive licenses, allowing skilled but unlicensed volunteers to practice, and allowing medical students who are close to completing their training to practice.

Furthermore, the EO grants broad authority to health care licensure boards to waive or modify existing regulations. These include the licensure boards for medicine, nursing, midwifery, social worker, respiratory care, pharmacy, and many others. Granting extensive authority to waive regulations will undoubtedly help these health care professionals better respond to the coronavirus pandemic. However, there are two areas where the Medical Board and the Pharmacy Board could further increase the health care supply.

First, the NC Medical Board should waive all of the collaborative practice agreement requirements for nurse practitioners and other advanced practice registered nurses. Removing this arcane supervisory requirement will empower nurse practitioners and other advanced practice registered nurses to offer the full range of their services. Second, the Pharmacy Board could allow pharmacists to test and treat non-chronic conditions such as strep and flu to ease the burden on other health care providers. This will keep those individuals not suffering from COVID-19 out of the hospitals and emergency rooms.

Restrictive scope of practice wars in the medical field usually amount to a battle over turf and profit. The result is a more complicated health care system and less access for patients. Licensure and scope of practice restrictions should remain waived indefinitely.

Telehealth

Lastly, the new EO further expands on the use of telehealth. America has deployed telehealth technologies to fight the coronavirus because of its ability to connect patients and providers at a distance. As America deals with an extremely contagious disease, providing ways for patients to seek care virtually before going to the hospital or doctor’s office is a useful tool to slow the spread. Furthermore, as many of our health care providers are in the “high-risk” demographic for catching the disease, it also makes sense to reduce as much direct contact with patients as possible.

However, until Gov. Cooper’s executive order, North Carolinians could not see a doctor who didn’t have a North Carolina state license. Patients’ access to virtual care stopped at the state borders. Doctors who want to treat patients virtually from other states could not cross the digital border into North Carolina without first obtaining a license. Fortunately, Gov. Cooper has recognized the need for more telemedicine access in the state and has recognized out-of-state licenses for telemedicine practices.

As telemedicine has emerged as a crucial tool to fight coronavirus, it is likely gaining popularity among patients and providers. The use of telehealth in traditional care delivery will continue. For that reason, the General Assembly should codify all of these new telehealth expansions so that we never have a law that restricts a patient from seeking care or a doctor from providing care through this new medium.

Many of these policy changes quickly implemented have been recommendations of the John Locke Foundation for a number of years. Especially within the health care sector, we believe that government intrusion and regulation of medical practice is bad for consumers. If waiving these laws helps the health care system and patients during a pandemic, why should providers and patients be afforded the same freedom and flexibility in the absence of a pandemic?

Jordan joined the Locke Foundation in the summer of 2018 as Health Care Policy Analyst. He analyzes state and national health policy issues with an eye toward removing government barriers and instead infusing health care with free-market solutions that encourage… ...

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