For four decades, hospitals wanting to expand or open new facilities have had to get the state to agree there’s a need for more healthcare in their community.
It’s a rule that Republicans in the Florida House say creates unnecessary burdens on the free market. This week, they’ll be passing a bill to repeal it.
But opponents of the repeal worry that allowing hospitals to build beds wherever they want will encourage health facilities to build in wealthy areas, leaving poor communities with limited options and safety net hospitals strapped for cash.
Legislation (HB 7) to repeal the regulations, called certificate of need (CON), is expected on Wednesday to pass the Florida House, where it is a priority of Speaker Richard Corcoran, R-Land O’Lakes. It also has the endorsement of Gov. Rick Scott, who called it one of his top healthcare priorities this year.
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Supporters of repealing CON say the bill eliminates regulations that limit hospital beds in a community, stifle competition, inspire costly legal fights over hospital construction and raise healthcare costs.
“Removing it will eliminate a lot of these unnecessary barriers to entry,” said Rep. Alex Miller, R-Sarasota, who is sponsoring the repeal legislation in the House.
But the legislation’s odds appear slim. Similar bills in the Florida Senate have not had a single hearing.
That’s good news for Democrats in the House. Rep. Evan Jenne, D-Dania Beach, called it “one of the worst bills this session.”
Democrats and others say getting rid of CON is unnecessary and might reduce the quality of care by overcrowding the market.
“Won’t repealing CON create a two-tiered system: One for the insured living in wealthy areas and one for uninsured in low-income areas?” said Rep. John Cortes, D-Kissimmee.
The state’s safety net hospitals oppose repealing CON for exactly that reason.
They worry about getting stuck with large numbers of patients on Medicaid, who pay less than the cost of care provided, or who have no health coverage at all.
But Miller says safety net hospitals like Jackson Health System, Tampa General and Johns Hopkins All Children’s get incentives to take on charity care cases with extra Medicaid funding.
What’s more, she doesn’t expect too many new hospitals to open.
“There’s not a big appetite to build new bed towers,” Miller said. “They’re very expensive. They cost $1.5 million per bed, so often they can be $100 million or $200 million just to build a bed tower.”
Thirteen states have taken CON off the books already, and proponents say the effect has been minor in hospitals. States with the restrictions have just 13 percent fewer hospital beds than those without the restrictions.
Contact Michael Auslen at firstname.lastname@example.org. Follow @MichaelAuslen.