Credit: Jill Nolin / Georgia Recorder
Georgia lawmakers prepare to take on state rules that limit new hospital construction
State lawmakers are settling in for a long look at how Georgia regulates health care services and whether drastic changes should be pursued again next year.
The fraught issue was at the center of late-session jockeying earlier this year between the House and Senate, which passed a bill with a 42-13 vote that would have exempted most rural hospitals from the certificate-of-need process. That bill stalled in the House.
Now, both chambers have created study committees that will meet during the legislative off season, with the Senate’s “reform” panel getting a jumpstart Tuesday.
“I think that probably all of us walk into the room with certain preconceived notions on what should happen with CON,” said Sen. Greg Dolezal, a Cumming Republican who sponsored the Senate bill and who is chairing the study committee. “I think we’re all going to walk out after the (last) meeting with different ideas than we walked in the room with and that would, for me, define success.”
Georgia is one of 34 states with some form of certificate-of-need laws, which control the number of health care services in a geographic area by requiring health care providers that want to open or expand to show there is a demand for more services.
Supporters say the decades-old law protects hospitals from new centers that could peel off profitable services and hurt existing safety net facilities. But critics note rural hospitals have closed anyway and argue the restrictive program is blocking competition and keeping new services from coming to some communities.
The Senate bill from the 2023 legislative session remains alive for next year. Whether it’s that bill or another, the issue seems poised to be a hot one again for next year.
“It’s an antiquated law. There are going to be some changes,” Sen. Freddie Powell Sims, a Dawson Democrat who represents a sprawling 13-county district in southwest Georgia, told reporters Tuesday. “So how do I help to make the best changes for my district? … How are we going to make sure that there’s access and quality for everybody?”
An analysis from the Senate Research Office released this month reviewed the studies available on the impact of tossing out these strict hospital regulations and found a murky view of the state-by-state effects on the health care industry.
There are those who would like to see Georgia follow the path of other states, like South Carolina where the program was repealed for everything but long-term care facilities. In North Carolina, lawmakers approved a compromise this year that included both significant changes to its program and Medicaid expansion.
Sen. Ben Watson, a Savannah Republican on the study committee and a physician, acknowledged the “mixed results” of the studies. Watson sponsored a bill this session that would have repealed Georgia’s certificate-of-need law, except for long-term care facilities.
“If it’s not showing unequivocal results for keeping more regulation, then it’s hard to justify a monopoly and being anti-competitive,” Watson said.
One researcher, Thomas Stratmann with George Mason University, told lawmakers Tuesday that Georgia’s regulations apply to 22 medical services, causing Georgia to rank seventh for states with the highest number of certificate-of-need laws.
Stratmann said his research shows that Georgia could see seven additional hospitals and that the current number of ambulatory surgery centers could grow from about 360 to 500 without today’s existing limits.
“The takeaway from these findings is CON laws are bad for Georgia residents because they reduce the quality of medical care, they reduce access, and they reduce opportunities to obtain medical services such as MRI scans or CT scans,” said Stratmann, who Zoomed in to give his presentation. “The research shows that Georgians will be better off if the Peach State will join the states that do not have CON laws.”
Hospitals have long resisted changes to the program and have fought off major overhauls over the years. Changes were last made in 2019, including a provision that a rival provider has to be within 35 miles of a proposed project to challenge it.
Anna Adams, executive vice president of external affairs with the Georgia Hospital Association, urged lawmakers to consider changes to these health care regulations in a broader context.
“I would also encourage you to think of CON not as the barrier to entry but the gateway so that we can protect quality, we can protect patients and make sure that we have access to all services, not just a proliferation of one service,” Adams said.
“Because I don’t think that anybody is interested in seeing us have 500 surgery centers in this state but no access to emergency services.”
Dolezal said his committee will hit the road for the next two meetings in Columbus and Augusta, visiting communities that have been “impacted by CON.” The last meeting is planned for Atlanta this fall.
Meanwhile, House Speaker Jon Burns recently named the members of that chamber’s study committee, which will be chaired by Swainsboro Republican Rep. Butch Parrish. The lone Democrat on the House panel is Minority Leader James Beverly of Macon.
This story comes to GPB through a reporting partnership with Georgia Recorder.