In an April 5 editorial titled “Bill would ruin certificate of need program,” the News Sentinel argued legislation Tennessee lawmakers are considering could make it harder for the poor and Tennesseans living in rural communities to obtain access to high-quality, affordable health care.
The fact is rural residents, the poor, and those most in need of Tennessee’s best health care stand to gain if the General Assembly passes House Bill 1730 and Senate Bill 1842, sponsored by state Rep. Cameron Sexton, R-Crossville, and state Sen. Todd Gardenhire, R-Chattanooga, respectively.
These bills would open new pathways for Tennesseans to access innovative, cost-effective health care services, facilities and equipment. At present, pathways to improving facilities are being blocked by Tennessee’s certificate of need law. The law requires hospitals and other medical facilities to apply for and obtain special approval from the Tennessee Health Services and Development Agency before health care providers may expand patient services and make needed upgrades.
The state’s current law impedes small and large health care improvements. A Tennessee hospital wishing to add even a single bed to one of its units must first chase down HSDA’s approval, which charges them for the pleasure. The nonrefundable minimum application fee is $3,000. The maximum fee — also nonrefundable — is $45,000, according to HSDA’s 23-page certificate of need application.
Tennessee’s state-certified need-based system implies current providers ought not to make improvements to facilities and services until after they have fallen into disrepair. As Sexton told Health Care News, “The [current] system doesn’t force people to improve what they have, because they know the CON prevents other people from entering their market.”
Sexton and Gardenhire’s proposed reforms would indeed guide Tennessee toward a better health care system — one based not on money or state-certified need, but on quality.
The current system discourages new providers from entering the health care marketplace and encourages current providers to grow complacent toward patients. The reform bill, by contrast, would help ensure hospitals and other medical facilities get and stay motivated to offer patients the best health care money can buy.
Scaling back certificate of need requirements would save Tennessee’s most innovative health care providers time, money and litigation — savings business-savvy providers will pass on to patients in the form of frequent facilities and equipment upgrades, lower costs and increased access to better health care services.
Reform could even save lives in rural Tennessee communities. States with certificate of need programs have on average 30 percent fewer hospitals and 13 percent fewer ambulatory surgical centers per 100,000 rural residents than states without such programs, according to a 2016 study by the Mercatus Center at George Mason University. The state’s certificate of need law places rural communities at a medical disadvantage by effectively making it easier for providers in counties with more than 200,000 people to acquire magnetic resonance imaging machines than providers in less populous counties. Reform is more likely to help rural Tennessee patients gain access to potentially life-saving radiology services.
Cost-prohibitive application fees, lack of motivation for current providers to upgrade facilities and government-created obstacles to rural health care certify Tennessee’s need for certificate of need reform.