CON only hinders health care process
On Feb. 26, the Times ran a column by Coffee Health Group CEO Carl Bailey in defense of the State of Alabama's Certificate of Need (CON) process for hospitals (see above). I wholeheartedly disagree with the need for this process, and because of the harm it has caused to Madison's quest for a hospital, I believe it should be repealed immediately.
Under the CON process, any prospective hospital developer must secure a "certificate of need" from the State. Approval is based on whether the State believes there is a need for the hospital in the area applied for. The theory is that by preventing "overspending" on hospital and health care facilities, hospitals can keep their costs down.
First, despite Mr. Bailey's assertion based on three unnamed studies from Michigan, the Alabama Policy Institute has reviewed numerous studies published by the Federal Trade Commission, the Journal of Health Politics, Policy and Law, the US Department of Justice, and others for their 2007 report on CON laws. This report is published on their web site, www.alabamapolicy.org. They concluded that there is absolutely no evidence that CON laws hold down health care costs. On the contrary, CON laws, by making it more difficult and expensive (and sometimes impossible) to develop a new hospital, actually raise health care costs.
Second, Mr. Bailey's assertion that restricting the development of hospitals leads to higher volumes of patients per hospital and, therefore, "safer" procedures, is not only counterintuitive but completely unsupported. Licensing of doctors and hospitals, continuing education requirements, accreditation, and other means are the proper way to maintain hospital safety. Restricting the number of hospitals in pursuit of this goal makes little sense.
Finally, even if, as Mr. Bailey asserts, the repeal of CON laws does lead to a proliferation of "specialty" facilities, it is hard to see how this hurts anyone. Those with health insurance are helped by having access to these facilities. The uninsured are not made any better off by this, but neither are they harmed by it. Since there is no evidence that the repeal of CON laws raises the cost of care, the poor are unaffected.
In fact, there is no evidence that CON laws benefit anyone other than hospitals, who are protected from competition by this cumbersome process. As Madison's experience indicates, CON laws create delays and unnecessary expenses and ultimately prevent proper access to health care for many, many people. Alabama's CON law should be repealed as soon as possible. The current session of the Legislature would not be too soon.
