According to the Mercatus Center at George Mason University, as of 2016, 35 states have Certificate of Need (CON) Laws.
The website notes:
This means that 35 states and the District of Columbia currently prohibit entry or expansion of healthcare facilities through CON programs.
North Carolina is one of those states with CON programs. The Carolina Journal posted an article about how those programs impact medical care in those states.
The Carolina Journal states:
It’s especially bad when government encourages health care providers to act more like bullies than healers. But that’s exactly what can happen with North Carolina’s certificate-of-need regime.
A recent court case highlights the problem. On July 6, a unanimous three-judge panel of the N.C. Court of Appeals agreed to grant a certificate of need to InSight Health Corp. The ruling affirmed earlier decisions from state regulators and an administrative law judge. In that sense, the ruling was unremarkable.
But details of the case, spelled out in Judge John Tyson’s 17-page opinion, highlight CON’s unsavory impact on N.C. health care.
The certificate of need is a government permission slip. Without it, health care providers are banned from opening new facilities, adding beds to existing hospitals, or even purchasing larger pieces of medical equipment. A government-appointed board working with state bureaucrats decides when and where to issue a CON.
One piece of equipment subject to a state CON is the positron emission tomography, or PET, scanner. It offers images that show how patients’ tissues and organs are functioning. In 2018 state government decreed that N.C. health consumers needed exactly one new mobile PET scanner across the state.
Without CON restrictions, health care providers would have been free to make their own decisions about adding new PET scanners. One or more providers might have put new scanners into operation in 2018, giving patients more options.
Instead the state forced interested providers to compete for a single CON. The certificate would grant the winner the exclusive right to purchase a new PET scanner. The winner would reap all financial benefits from additional scans.
The article explains that when the winner was named, one of the other competitors filed a complaint.
The article notes:
Now, three years after the state decided to offer a CON and two years after awarding it, there’s still no new PET scanner. All we have is a ruling from North Carolina’s second-highest court. It’s not even clear that the legal fight is over.
Bureaucratic and legal delays would be bad enough. But Tyson’s opinion highlighted evidence of behavior no one should expect from organizations devoted to boosting people’s health.
The article concludes:
InSight was able to secure supporting documents from hospitals in Caldwell and Jackson counties. But Mobile Imaging later approached leaders of both hospitals. Mobile’s team had drafted letters that would rescind support for InSight’s application. One hospital official signed the letter, leaving InSight with a single hospital willing to go on record supporting its CON application.
Despite having signed the letter, the hospital president who went along with Mobile Imaging’s scheme later testified that she still would have considered working with InSight if it won the CON.
In other words, the only objection to InSight’s bid was active opposition from a competitor with an “effective monopoly” on existing services. Tyson noted “ample evidence” of Mobile Imaging’s “anti-competitive behavior.”
Nothing looks good about Mobile Imaging Partners’ actions in this case. Its behind-the-scenes maneuvers look especially bad when one considers the CON’s purported goal: increased access to health care. You’ll search in vain to find bullying and scare tactics among the skills taught to health care professionals.
This entire problem (including the court case) could be settled by ending the CON Laws in North Carolina. There has been a bill brought up in the North Carolina legislature to end CON Laws in at least one recent session The problem is that the bill has been traditionally sent to a committee where it dies. CON laws cost consumers and health insurance complanies money. CON Laws need to end.