Senators study CON reform, make no recommendations

A study committee set up by the Senate Commerce Committee, chaired by Sen. Todd Gardenhire, met Monday to hear testimony on whether to continue Tennessee’s “certificate of need” program, which requires a state agency’s approval prior to major new expansions of health care facilities. There were some calls for repeal of the CON process, but more calls to keep it in place — perhaps with some changes or new exemptions in some areas.

From The Tennessean report:

Lawmakers probably will take up efforts to reform laws governing patient amenities, such as upgrades to waiting rooms, and capital thresholds as well as some clinical specialties that could be removed from the certificate of need regulations.

“We’ve got to find those very specific clinical scenarios where the certificate of need provides a clinical protection for the patient — and then we’ll still stand on that,” said Sen. Mark Green, M.D. “I think you’ll see anywhere there’s a number we’re going to bring it to today’s inflation adjusted amount.”

Tennessee is one of 36 states, including Washington, D.C., with a certificate of need program. It has one of the heftiest CON programs with 20 laws. In Tennessee, health care providers apply with the Health Services and Development Agency for a certificate of need to build facilities or expand into new services.

Certificate of need programs are seen by many as a way to ensure health care providers provide charity care and to control the build-out of the industry.

Voices for significant reform of the programs, including the Beacon Center of Tennessee, argue that the programs keep costs high through increased regulation, which stymies competition.

“I want to see why there’s so much opposition to lowering the cost of health care and why there’s so much support for protecting the status quo,” Gardenhire said before the hearing.

Representatives of HCA, HSDA, Tennessee Hospice Organization, Tennessee Public Teaching Hospital Association and Vanderbilt University Medical Center addressed how the program gives structure to the health care system around the state and some areas that could be improved.

VUMC would like to see “modernization” of the CON rules on patient amenities and the threshold that is required to file for approval for a project, said Clisby Hall, senior adviser of health policy.

…Gardenhire was disappointed that most of the speakers, and hearing attendees, were “here to protect the status quo” and did not bring lists of areas where they want reform. He plans to meet in the coming months with those who want to help rethink the certificate of need.

“I’m going to pin them down,” Gardenhire said.