South Carolina lawmakers to meet again to consider bill to eliminate the state’s CON program

(The Center Square) — Legislation to repeal certificate of need laws in South Carolina is expected to work its way through the House committee process this week after a House ad hoc committee meets for a second time on the topic on Tuesday.

The session is expected to end on May 12 and S. 290 would have to make its way through the process before then after passing the Senate in January.

Certificate of need laws were mandated by the federal government in 1974 and regulate how many medical facilities are available in an area and what services they provide in an effort to keep costs to consumers lower. Even though Congress later eliminated the CON requirement in 1987, many states retained them.

South Carolina is one of 35 states with a certificate of need program.

Those who argue against the certificate of need laws, however, say they have the opposite effect in how they delay or prevent health care facilities from being built in areas of need as competitors battle new facilities in court.

The first meeting of the House ad hoc committee on CON laws took place on April 19.

During that meeting, Matt Mitchell, an economist at George Mason’s Mercatus Center, said that he reviewed 93 peer reviewed studies of CON laws that overwhelmingly showed that there was more access to care and lower costs in states without CON laws.

“If you restrict supply, then you would expect a lower access to care, and that’s exactly what happens,” Mitchell said.

Mitchell said that access to care for Black residents was shown to significantly improve in states without CON laws, where a large disparity was shown in places with CON laws.

“You don’t have to speculate on what would happen in a South Carolina without CON laws,” Mitchell said. “We can look to these experiences of the four in 10 Americans who live, work and receive care every day in a state without a certificate of need law.”

Mitchell added that four times as many studies show that CON laws lower quality of care compared to states without CON laws.

Charles McDonough, CEO of Interim Healthcare of the Upstate, suggested that lawmakers keep home health care under the CON program because large amounts of supply can lead to the overutilization of home health care services.

“The CON protects patient choice and preserves patients’ access to care,” McDonough said. “As one of South Carolina’s largest home health providers, we see this on a daily basis as we have expanded our existing footprint and continue expand our footprint into rural and urban areas alike.”

A report from the South Carolina Legislative Audit Council recommended amendments to the state’s current CON law, which were cited in testimony in front of the committee.

The report advised increasing the thresholds for equipment and capital expenditures for the certificate of need program and provide for adjustments based on the Consumer Price Index.

“No one in our state, I am quite sure, wants to see any more small rural hospitals close,” said Graham Adams, CEO of the South Carolina Office of Rural Health. “We think that full repeal of CON would threaten the financial viability of a lot of our existing healthcare facilities, especially those in larger rural communities and large metropolitan areas, thereby threatening the viability of those larger health systems to really adequately serve the rural portions of their footprint.”

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