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Debate Over Certificate of Need Gaining Traction in West Virginia Legislature

Photo Courtesy of W.Va. Legislative Photography - House Majority Leader Amy Summers, R-Taylor, said a bill repealing the certificate of need law could be on a committee agenda soon.

CHARLESTON — With hospitals overwhelmed with the influx of COVID-19 patients and with a shortage of nurses and medical professionals, some believe that now is the moment to remove a possible barrier, West Virginia’s certificate of need law.

A bill to do just that could be introduced and on a committee agenda in the House of Delegates by the end of the month, but opponents believe that repealing certificates of need won’t solve the problem of job flight and could decrease the quality of care West Virginians could receive in the future.

House Majority Leader Amy Summers, R-Taylor, is an emergency room nurse and has long been a supporter of repealing the certificate of need. Summers was the lead sponsor of House Bill 2077 last year that would have eliminated certificates of need. That bill was never taken up by committee.

House Republicans have introduced bills to repeal the certificate of need every year since 2017, but speaking Friday morning, Summers said support is finally growing for removing the requirement from code.

“I think the original goal was to control costs and provide access to care, and it hasn’t done that. It hasn’t done that at all,” Summers said. “I think the reason it came to the surface again is because of the pandemic.

“We’re seeing these systems almost near collapse and people need hospital beds and they aren’t able to provide it.”

West Virginia’s certificate of need rules, signed into law in 1977, were designed to help control healthcare costs and prohibit duplicative or unneeded medical services in communities. Healthcare providers are required to receive a certificate of need from the West Virginia Health Care Authority when they propose to add or expand their services, or if their capital and medical equipment expenditures exceed $5.3 million.

While hospitals get all the headlines, CON affects other healthcare options, such as the number of hospices and birthing centers that provide an alternative to hospital environments. Summers also said CON is one of several factors in driving nurses out of the state. With fewer options for employment in the state and better pay and opportunities elsewhere, the temptation to leave the state is strong.

“Because of the workforce shortage, the workers have more power and more opportunity to look for the best work environment,” Summers said. “They can make more money and they can search out different work environments that they might want to work in.”

According to the National Conference of State Legislatures, 35 states and Washington, D.C., offer a variation of a certificate of need program. As of 2021, 12 states have repealed their certificate of need laws, with New Hampshire being the most recent state to do so in 2016.

The thought process behind many of these laws was that if hospitals and other facilities have empty beds, the cost for those beds increases, causing inflation. Certificate of need programs are supposed to ensure that no more facilities are built than what are needed, helping keep healthcare costs low and ensuring access. Some states, like West Virginia, have a moratorium on certain high-need services, such as opioid treatment, skilled nursing and facilities for people with developmental disabilities.

Certificate of need repeal also has support from conservative and free-market groups, such as the Cardinal Institute for West Virginia Policy and the Virginia-based Mercatus Center at George Mason University.

Matthew Mitchell, a senior research fellow at the Mercatus Center, penned a policy brief in September looking at West Virginia’s certificate of need law. Mitchell estimated that with a repeal of certificate of need, the number of regional and rural hospitals could increase, improving mortality rates and lowering the chance for hospital readmissions down the road.

“Whereas patients and payers are harmed by the regulation, hospital executives benefit from it,” Mitchell wrote. “Researchers find that urban hospital CEO pay is over $90,000 higher in CON law states than in non-CON law states.”

In Mississippi, a federal court ruled last week that a case challenging the state’s certificate of need law can move forward. Federal District Court Judge Carlton Reeves found that Mississippi’s certificate of need benefited existing healthcare companies while preventing new or expanded services from being offered.

“…The CON application and approval process … is lengthy and costly, and ultimately the process can result in what is essentially a trial with attorneys, consultants, exhibits, and written motions,” Reeves wrote. “Taken as true, as the Court must, the allegations reveal that CON laws result in more costly, less accessible, and worse quality healthcare… It is no secret that significant financial interests are at stake when it comes to CON laws.”

However, other studies have found marginal benefits to certificate of need repeals. A study published in 2020 by the Journal of the American Medical Association found that there were …”no significant differences found between states without and with certificate of need regulation for overall hospital procedural volume; hospital market share; county-level procedures per 10,000 persons; or risk-adjusted 30-day postoperative mortality, surgical site infection, or readmission.”

Another study released in 2020 by researchers Christopher Conover and James Bailey, reviewing 90 articles on certificate of need, found that “…The literature has not yet reached a definitive conclusion on how CON laws affect health expenditures, outcomes, or access to care. While more and higher quality research is needed to reach confident conclusions, our cost-effectiveness analysis based on the existing literature shows that the expected costs of CON exceed its benefits.”

Sen. Richard Lindsay, D-Kanawha, penned an op-ed several weeks ago defending certificate of need in West Virginia and recommending against its repeal.

“If you just look at the phrase and the nomenclature ‘certificate of need,’ there has to be a need in order to provide any hospital or medical service,” Lindsay said during an interview Tuesday. “That supports the hospital system that is already in place and it keeps a certain quality of care for everyone who wants to take part in it.”

Lindsay said repealing certificate of need could hurt the quality of care by allowing more inexperienced medical professionals into the market.

“I think he’s just guessing that those things could happen,” Summers said in response. “He’s just proposing those, but none of that’s been proven in the states that don’t have certificate of need. Why is it only people that have less experience that want to come here?”

Asked whether he thought certificate of need repeal would reverse the trend of hospital closures and medical professionals fleeing the state, Lindsay said he believes those issues can be addressed in other ways. Democratic lawmakers have proposed incentives and tax breaks to entice nurses to stay in the profession. They have also called for speeding up reimbursement for hospital care.

“I think that has to do with doctors who want to live and decide to raise their family in Wetzel County versus Kanawha County,” Lindsay said. “Rural hospitals are always going to be at a disadvantage. That’s why we’ve expanded our nurse practitioner program and expanded their role in providing care. I think those are separate issues. I’m more than happy to talk to anyone to discuss how we address those problems.”

Summers believes repealing CON can provide those opportunities to expand healthcare options for West Virginians, lower healthcare costs, and help retain and recruit medical professionals in rural parts of the state.

“I think the pandemic has brought out so many things that we need to change that we’ve seen, that have occurred because of it,” Summers said. “Yeah, I think (CON repeal) is one of them. We need more access to care, we need to control costs, and patients and employees need more opportunities on where they want to go and who they want to work for.”

“We’ve been looking out for the providers for years, but at some point we got to turn around and look at the patients and what they need,” Summers said.

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