ATLANTA – The state Senate was where the action was in the General Assembly this year either to reform or repeal Georgia’s decades-old certificate of need law (CON) governing hospitals and health-care services.
Heading into the summer, there’s every indication Republican senators will continue aggressively pursuing their push to overhaul CON or scrap it entirely. A newly created Senate study committee of senators, health-care executives and an insurance industry representative will begin meeting June 13 to look for ways to at least reform the law.
The Senate Study Committee on Certificate of Need Reform is poised to start its work earlier than most legislative study committees, which typically don’t start meeting until well into the summer.
“It definitely shows the importance of the issue, especially to the Senate,” said Chris Denson, director of policy and research for the Georgia Public Policy Foundation, a think tank that advocates free-market approaches to public-policy issues.
Georgia’s CON law requires applicants wishing to build a new medical facility or provide a new health-care service to demonstrate to the state Department of Community Health that the facility or service is needed in that community.
The General Assembly passed the law in 1979 to comply with a federal mandate aimed at reducing health-care costs by avoiding duplication, only to see Congress repeal the federal statute in 1986. By 1990, 11 states – including California and Texas – had done away with their state CON laws.
This year’s push to reform or abolish CON in Georgia came primarily through two bills introduced by Senate Republicans. Senate Bill 99 called for exempting most rural hospitals from the law, while Senate Bill 162 would have repealed CON entirely except for long-term care facilities.
South Carolina lawmakers abolished the Palmetto State’s CON law this year, also with the exception of long-term care facilities.
Senate Bill 99 passed the Senate 42-13, including the votes of nine Democrats, but died in the Georgia House of Representatives. The repeal bill cleared the Senate Regulated Industries and Utilities Committee but failed to reach the Senate floor for a vote.
Denson’s group favors repealing CON. He and Matthew Mitchell, a researcher at West Virginia University, released a report in April that points to barriers to health-care access CON laws impose and questions the argument that getting rid of the law would result in a wave of hospital closures.
“The fears of the widespread closure of safety net hospitals is overblown,” Denson said. “There’s no correlation between CON laws and rural hospital closures.”
Monty Veazey, president and CEO of the Georgia Alliance of Community Hospitals, said making it easier to build new hospitals and ambulatory-surgery centers by abolishing the CON law would not improve access to health care in rural communities as supporters of repeal argue.
“These hospitals are not going to be built in rural areas,” Veazey said. “They’re going to be built in zip codes where the money is. … It’s all about the money.”
The Senate study committee is dominated by Republicans – including Sens. Greg Dolezal of Cumming, who will chair the panel; Kay Kirkpatrick of Marietta; Matt Brass of Newnan; Bill Cowsert of Athens; and Ben Watson of Savannah. Democrats on the committee includes Sens. Freddie Powell Sims of Dawson and Ed Harbison of Columbus.
Non-legislators on the panel include Jack Hughston Memorial Hospital CEO Mark Baker to represent for-profit health systems, Memorial Health Meadows Hospital CEO Matt Hasbrouck to represent rural hospitals, Christine Macewen of Piedmont Health Care to represent nonprofit health systems, Georgia Association of Health Plans CEO Jesse Weathington to represent the insurance industry, and independent physician Dr. Stephen Wertheim.
Meanwhile, the House also is expected to weigh in on CON this summer and fall.
House lawmakers voted on the last day of this year’s legislative session to create a study committee on CON. Its members have yet to be appointed.