The West Virginia Senate has introduced a bill that would remove certificate of need (CON) requirements for virtually all health care services and providers in the state. If passed, the bill would also ensure that all prior CON decisions have “no force and effect” by 2026.
CON laws are intended to reduce costs and improve access to health care by controlling the construction of new medical facilities and the expansion of existing facilities through state-based regulation. Unfortunately, CON laws decrease health care access, raise costs, lower quality, and stifle innovation by giving competing health care providers veto power over the construction or improvement of facilities or other capital improvements such as advanced imaging devices.
Under SB 453, sponsored by State Sen. Randy Smith (R), “nearly all language requiring a health care provider to obtain a certificate of need before offering services would be removed from the state code,” The Herald Dispatch reports. Moreover, “The bill would also eliminate the entire West Virginia Health Care Authority and all positions within the department.”
The bill, specifically requested by Gov. Patrick Morrisey, is now under consideration in the West Virginia Senate’s Health and Human Resources Committee.
This CON reform would improve access to health care in West Virginia while putting beneficial pressures on costs and quality by encouraging greater investment in new facilities and improvements of existing ones.
Patients and the public health benefit when states reduce regulatory barriers to the construction of new health care facilities. Years of evidence clearly show the free market does a better job of controlling costs and at least as good a job at ensuring people have access to health care as CON laws do.
According to Gov. Morrisey, a full CON repeal would eliminate “big government activism at its worst” and “move [the state’s heath care system] toward a more free market.”
As the research shows, CON laws do the opposite of what they are intended to do. In the 1960s, policymakers began to worry that the free market would concentrate lucrative medical services in some areas while creating an undersupply of services everywhere else. Beginning in 1964 with New York and extending to nearly every state throughout the 1980s, legislatures began to control the licensing of new facilities. In 1987, federal mandates requiring CON were removed. Since then, states have begun to reform and repeal their CON laws as many legislatures have determined that rationing health care in this way has done more harm than good.
Currently, 35 states and the District of Columbia require care providers to go through a CON approval process before constructing a facility or in some cases even buying certain equipment such as imaging machines. As of 2024, 12 states had completely repealed their CON laws.
The following documents provide additional information about Certificate of Need policy:
Do Certificate of Need Laws Limit Spending?
Matthew Mitchel from the Mercatus Center examines cost implications of certificate of need laws across the health care system.
2022 Testimony on the South Carolina Certificate of Need Repeal
Matt Dean of The Heartland Institute testified about a South Carolina bill to repeal CON.
Certificate of Need (CON) State Laws
The National Conference of State Legislatures provides a state-by-state update on CON laws with an interactive map.
CON Laws in 2020: About the Update
Matthew Mitchell and Anne Philpot of the Mercatus Center update the CON legislative landscape and provide context for state policy reforms.
Tearing Down Regulations That Restrict the Supply of Health Care Has Become Bipartisan
Policy reporter Patrick Gleason examines the political currents and crosscurrents that created rare bipartisanship in favor of CON repeal.
Certificate of Need Laws; A Systematic Review and Cost-Effectiveness Analysis
Christopher Conover and James Bailey from BCM Health Services provide an analysis of 90 studies of the effectiveness of CON legislation in the states.
Nothing in this Research & Commentary is intended to influence the passage of legislation, and it does not necessarily represent the views of The Heartland Institute. For further information on this and other topics, visit the Health Care News website and The Heartland Institute’s website.
The Heartland Institute can send an expert to your state to testify or brief your caucus, host an event in your state, or send you further information on a topic. Please don’t hesitate to contact us if we can be of assistance! If you have any questions or comments, contact Heartland’s government relations team at [email protected] or 312/377-4000.
Chris Talgo is senior editor at The Heartland Institute and a research fellow for Heartland’s Socialism Research Center.
