Now, for the first time in a generation, the General Assembly is considering changing the CON law, a move that could save consumers millions of dollars in unnecessary health care costs.
According to a new study, North Carolina ranks among the top of all states in the regulation of our healthcare care system. In fact, we are the third most regulated in the United States.
The center of this regulation is the CON law, a restrictive and expensive regulatory system that prohibits health care providers from entering new markets or making changes to their existing facilities or services without state approval. The CON law applies to 25 medical devices and services – from hospital beds to out patient surgery to MRI’s.
The result is government regulation that stifles competition and discourages innovation, which in turn leads to higher costs for consumers.
Attempts in recent years to repeal the CON law have been unsuccessful because of strong opposition from vested interests that don’t want competition. That’s the bad news.
The good news is that Sen. Tom Apodaca of Henderson County took the time to research the issue. What he discovered – that the CON laws lead to higher costs and a lack of competition – convinced him that it was time to repeal CON in North Carolina.
With Sen. Apodaca’s assistance, the Senate budget, which is scheduled to be released the week of June 8, is likely to include a provision that will repeal the CON law. The issue will then go to a conference committee where both sides will work out a compromise version of their budget, including reviewing the Senate’s CON reform proposal.
How much money is at stake? Hard to say, but a minor modification to CON laws allowing gastroenterologists to operate single specialty operating rooms for colonoscopies resulted in $244,000,000 in savings over a six-year period.
Supporters of the CON law say it is necessary to protect providers who serve uninsured patients. Without CON, they say, other providers will cherry-pick patients with insurance and leave those without coverage to safety net providers, with little or no way to pay for the services they provide.
Caring for the uninsured is a big issue in our healthcare system, that’s why reformers have proposed requiring those who enter or expand their service after CON reform is implemented should be required to show that they are providing a fixed percentage of charity care. One reform proposal fixes this percentage at 7 percent – well above the 4 percent charity care that North Carolina hospitals, on average, now provide.
CON reform will also help the state solve one of its most pressing challenges – controlling Medicaid costs. To reform Medicaid, doctors must be able to provide the services their patients need in the most affordable – and safe – setting possible.
Right now, however, state CON law prohibits many doctors from caring for their patients in their offices. Instead, they are forced to send them to providers, often at hospitals, where they are charged for medical care as well as expensive medical facility fees that can increase the cost of care by 25 percent or more.
Repealing the CON laws will open up the state’s healthcare industry to competition and innovation – while also expanding access to healthcare for those without insurance.
You can help be part of the effort to reform our healthcare system and reduce healthcare costs. Call or write your legislator and ask them to pass Certificate of Need reform this year.