North Carolina Scratches CON Repeal from Bill Naming State Cat

Published August 17, 2016

Clawing their way toward certificate of need (CON) repeal, a North Carolina lawmaker commandeered a bill initially proposing to choose a state cat.

Health care and residential treatment facilities would no longer have been required to obtain approval from a special state board before altering their range of services, had lawmakers adopted an amendment to House Bill 161, titled “An Act Adopting the Bobcat as the Official State Cat of the State of North Carolina.”

State Sen. Ralph Hise (R-Mitchell) tied his CON repeal proposal to the bobcat bill after the May 10 deadline for introducing new legislation had passed.

The legislature adjourned its short session, which ran from April 25 to July 1, without approving the bill. CON repeal could still land on its feet during the 2017 regular session, which will convene on January 11.

CON Intentions vs. Reality

Katherine Restrepo, a health and human services policy analyst at the John Locke Foundation, says CON laws undermine their stated purpose of increasing rural and other underserved patients’ access to affordable, quality health care.

“One of CON’s basic principles is to protect rural health care,” Restrepo said. “Members of North Carolina’s state health care planning division are responsible for ensuring equitable access to certain types of health care facilities and services in underserved areas of the state. Unfortunately, the state’s central planning system just doesn’t work.”

Repealing the CON law would increase the supply of health care providers in rural areas, lightening patient loads for doctors and encouraging facilities to make improvements, Restrepo says.

“The CON process stifles competition and innovation,” Restrepo said. “Limiting the supply of health care burdens patients and providers. Physicians practicing in rural areas of North Carolina have attested to that.”

Paying More for Outpatient

The CON law’s restrictions on ambulatory surgery centers (ASCs) are costing patients and other payers in North Carolina’s health care system, Restrepo says.

“CON laws make it difficult for patients to access certain health care services conveniently and at a lower cost,” said Restrepo. “Take ambulatory surgery centers. Because CON law limits the number of ASCs in North Carolina, 70 percent of [state] outpatient surgeries are still performed in a full-hospital setting. This is costing patients and the health care system 40–65 percent more for the same procedure that can be performed in an ASC, a less expensive setting that delivers the same, if not better, quality care.”   

Innovation, Improvements Within Reach

Thomas Stratmann, a Mercatus Center scholar and university professor of economics at George Mason University, says increasing the supply of health care providers in North Carolina would improve quality and open up more treatment options for patients.

“A CON repeal would mean to abandon all aspects of CON, as is current practice in 15 states in the United States,” Stratmann said. “As a result of a repeal, we would observe additional entry into the medical profession, which means more access to patients, more choices for patients, and higher quality care.”

As the number of providers in a region grows, they will naturally improve the quality and value they offer to compete for the patient population, Stratmann says.

“We would observe higher quality care, because with repeal, and subsequent entry—more medical providers offering services—there will be more competition among these providers,” Stratmann said. “And one way providers compete for patients is to offer higher quality, more pleasant, and more effective care.”

Fourth-Most Restrictive State

Since 1978, 36 states have imposed CON laws restricting the locations, services, and equipment of health care facilities, according to a 2015 study Stratmann coauthored titled “Certificate-of-Need Laws: Implications for North Carolina.”

North Carolina’s CON law restricts 25 medical devices and services, making it the fourth-most restrictive in the nation, behind those of Vermont, Washington, DC, and Hawaii, Stratmann’s study found.

Josh Thomas ([email protected]) writes from Toledo, Ohio.

Internet Info:

Matthew Glans, “Repeal North Carolina’s Certificate of Need Law,” Research & Commentary, The Heartland Institute, June 23, 2016:–commentary-north-carolina-certificate-of-need-reform

Christopher Koopman and Thomas Stratmann, “Certificate-of-Need Laws: Implications for North Carolina,” Mercatus Center, George Mason University, February 12, 2015:

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