Certificate of Need debate shows division among Kentucky lawmakers
(The Center Square) – Last summer, the Kentucky General Assembly established a task force to examine the state’s Certificate of Need law to determine if any changes need to be made to the policy that regulates health care in the Bluegrass State.
That body recommended further study may help identify if changes need to be made to the policy that was established 50 years ago by federal mandate. Although the task force was not renewed for the 2024 interim, the topic is still fresh on the minds of some in Frankfort.
Last week, the Interim Joint Committee of Licensing, Occupations and Administrative Regulations held an hour-long hearing to dive deeper into the matter, which appears to underscore a rift between some lawmakers from urban and suburban areas and their counterparts in rural districts.
During the 2024 regular session, a pair of Northern Kentucky lawmakers filed three bills apiece seeking to make changes to the state’s Certificate of Need program, but none of them advanced to the floor in either the state House or Senate.
Proponents of eliminating or making wholesale changes to the program cite that the federal government did away with the mandate back in 1986, and that a dozen states – some as large as California, Pennsylvania and Texas and ones as small as the Dakotas and Wyoming – no longer have such laws.
“I don’t know about you, I can’t think of any other topic that Texas and California could agree on politically, but they’ve found some common ground on this issue of certificate of need,” said Alasdair Whitney, legislative counsel for the Institute for Justice, in testimony. “And they found that it doesn’t work for them. These are states with very large populations, very large groups of people on public benefits and a lot of rural land in those states.”
Proponents also say certificate of need laws stymie free market practices. State Rep. Marianne Proctor, R-Union, told the committee that people in her Northern Kentucky district “are clamoring for choices.” While some people can drive to nearby Ohio, not everyone has that ability.
Proctor sponsored three of the bills filed in this past General Assembly session.
State Sen. Stephen Meredith, R-Leitchfield, dismissed the free market argument, saying that’s not the case in some parts of Kentucky. The retired hospital executive said the state’s rural hospitals handle a disproportionate share of Medicare and Medicaid patients. Those public health care programs pay only a portion of the prices private insurance pays for care. Introducing competition in those regions, Meredith continued, could produce the opposite of the intended effect.
“There is no free market,” he said. “Hasn’t been a free market since July 30, 1965, when Medicare and Medicare were started… folks don’t like Monopoly as a word, but you have to have it to protect that small commercial pay base that we have. Otherwise, you’re not going to provide services like the emergency services because that’s the most heavily subsidized service within the hospital.”
While there was disagreement on whether certificates of need are essential, there was some common ground established in that any policy changes moving forward should address a couple of key principals.
State Rep. Killian Timoney, R-Nicholasville, said Kentucky needs a customized approach that needs to touch on other pressing health care issues that would also champion provider choice.
“Our objective should be lower health care costs and higher quality health care, period,” he said. “I think that we are addressing an issue with a much bigger elephant in the room… The fact that I have to get permission (from a health insurer), or well, you can pay for a different doctor, but they’re out of your network. Well, again, yeah, I could, but how many Kentuckians can’t? How many choices does that eliminate for them?”
