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Certificate of Need phase out in the Senate budget

Tax cuts, prudent spending, saving more for a rainy day are a few of the good things in the Senate budget.  Phasing out NC’s egregious Certificate of Need (CON) laws is another.  What we know is CON limits access, increases costs and compromises the quality of health care. A complete repeal would restore health care freedom for everyone across North Carolina.

Want to know the specifics of the Senate phase out plan? My colleague, Katherine Restrepo provides this summary:

SB 257 Certificate of Need Exemptions

Purchase of Additional Psychiatric and Facility-Based Crisis Beds With Dorothea Dix Hospital Property Funds (Page 143):

  • $1.8 million in non-recurring funds pays for renovation or building costs associated with construction of new licensed inpatient behavioral beds at Dix Crisis Intervention Center in Onslow County.
  • $6.2 million in non-recurring funds pays for construction of new licensed inpatient behavioral beds, conversion of existing inpatient acute care beds into licensed behavioral health beds.
  • Funds will be allocated to rural areas in the Eastern Central, and Western regions of the state with the highest need for inpatient behavioral health beds.
  • No CON review process necessary for conversion or construction of these inpatient mental health beds.  This is pursuant to a provision in last’s year’s budget.

Ophthalmologists (Page 151):  

  • For health care facilities in North Carolina to receive a facility fee payment from Medicare for treatments/services they provide patients, they must be licensed. In order for them to be licensed, they must first acquire a Certificate of Need. Under this exemption, eye surgeons will be given the opportunity to obtain a license for their unlicensed in-office surgical suites without having to go through the CON process.
  • Receiving a license allows eye surgeons to register their in-office surgical suites with Medicare. Medicare can then pay them facility fees for eye surgery they perform on Medicare patients in their surgical suites.

 Ambulatory Surgery Centers (Page 153-154):

  • Construction, Development, or Acquisition of ASCs exempt from CON review under the following conditions:
    • Physician(s) make an effort to engage in a joint venture with acute care or critical access hospital
    • If involved parties can’t come to an agreement on joint venture, physicians must provide written notice to DHHS
    • Medical staff at ASC must have nearby hospital privileges to ensure that patients have access to inpatient services in case of outpatient surgical complications.

Community Hospitals (Page 154):

  • Community hospitals with fewer than 200 beds are exempt from CON review for the development of new health care facilities, services, or acquisition of major medical equipment that is normally subject to CON review.

Psychiatric Facilities/Hospice Inpatient Facilities (Page 154)

  • Exempt from CON review effective October 1, 2017.

Complete Repeal of Certificate of Need Law (page 157)

  • Effective January 1, 2025.

Becki Gray / Senior Vice President

Becki Gray is Senior Vice President of the John Locke Foundation. She provides information, consultation, and publications to elected officials, government staff and other dec...

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