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Is there a need for Certificate-of-Need?

The answer is an unequivocal MAYBE.

A recent study conducted by the Center for Studying Health System Change (www.hschange.org) for the National Institute for Health Care Reform (www.nihcr.org) provides an excellent summary of the issues and difficulties involved both in administering a state CON program and in shepherding an application through the process.  There are 36 states and the District of Columbia that have CON laws in place; six states – Connecticut, Georgia, Illinois, Michigan, South Carolina, Washington – formed the interview pool from which 42 individuals, representing state agencies, hospitals, physician groups, hospital and medical societies, payers, consultants, attorneys, and policy-makers, were drawn.   

Some of the issues addressed:

  • Variation across states in how the CON process works and what activities are covered
  • Influence (or interference) of politics in the CON process (For example, the Illinois CON authority was temporarily suspended because of conflict of interest issues with several board members.)
  • Lengthiness of a process that may span years and, if contended, has been known to involve the state supreme court and/or state legislature in efforts to overturn unfavorable decisions
  • Impact, if any, of CON on market entry and/or expansion, competition, access, quality, and costs
  • Disparity in decisions that seem to favor not-for-profit hospitals over for-profit hospitals, physician groups, ambulatory care providers, etc. 

Despite the somewhat rough and rocky CON landscape, many respondents still feel there is a viable role for CON if the following can be achieved:

  • Renew the focus of CON on its original mission of state health planning
  • Establish a rigorous process for establishing, assessing, and enforcing CON standards
  • Ensure adequate funding and staffing for the state agencies responsible for administering the CON program

Source: Yee, Tracy, and others.  Health care certificate-of-need laws: policy or politics?  Research Brief.  (4)1-9, May 2011.  http://www.nihcr.org/CON_Laws.html

Additional resources:

American Health Planning Association.  National Directory: State Certificate of Need Programs, Health Planning Agencies.  2010 edition.  Published annually.  www.ahpanet.org

Cimasi, Robert J.  The U.S. Healthcare Certificate of Need Sourcebook.  Washington, DC: Beard Books, 2005.  www.beardbooks.com

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