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NC Lawmakers Consider Deregulation Of Health Care Facilities Construction

National Conference of State Legislatures

Some North Carolina lawmakers want to roll back or repeal a law that regulates the building of new health care facilities. It's called a Certificate of Need law, and North Carolina has used it since the 1970s.

About three dozen states have Certificate of Need laws. They set up a review process through which states can determine when certain areas need new hospitals, surgical centers or even high-tech equipment.

"Certificate of Need programs were really aimed at restraining health care facility costs and allowing coordinating planning of new services and construction," says Richard Cauchi of he National Conference of State Legislatures.

Many of the biggest businesses that are regulated – hospitals – are actually in favor of the laws. Their executives say it's a useful regulation of spending.

Critics say it prevents competition and keeps smaller facilities that could offer cheaper prices out of the game. A leader in the state Senate, Republican Tom Apodaca, has filed a bill to repeal the law. And a bipartisan group of House members has filed a bill to carve some facilities out of the law, like outpatient surgical centers.

Cauchi says bills like those come up in a handful of states fairly frequently.

"But I'd say there has not been a strong consensus that these are necessarily harmful versus these are necessarily directly effective," he says.

For that reason, the number of states that keep using Certificate of Need laws has roughly held steady for the last 15 years.