SC could make it easier for hospitals to build in a new location, opening access to patients
Lawmakers are pushing a bill that aims to increase patient access to health care by eliminating a process to require medical providers to get state approval to build new hospitals or other medical facilities and obtain large medical equipment.
South Carolina state senators on Wednesday began debating whether to get rid of a process that determines whether hospitals can build out new facilities, a process called certificate of need. The debate is expected to take several days.
Lawmakers pushing the bill say it will increase access to care and lower costs by increasing competition.
State law requires that when a health-care provider wants to build a hospital or acquire large medical equipment, it has to apply for a certificate of need with the S.C. Department of Health and Environmental Control. However the process also allows competing entities to object to a project, which can lead to delays or possibly kill proposals.
Currently nine applications are under review by DHEC, and 29 certificate of need decisions are under appeal.
Proponents of getting rid of the process say the certificate of need is burdensome, onerous and costly.
They also say certificate of need has not led to reduced health-care costs for patients as it was intended when it was put in place in the 1970s.
The process has been used by hospital systems to try to block one another from building facilities, being used as a weapon in that fight, said state Sen. Sean Bennett, R-Dorchester.
“We need to eliminate that,” Bennett said.
State Sen. Tom Davis, R-Beaufort, said on the floor that costs for patients are higher with the certificate of need because the supply of competitors is restricted.
“This is is not a Democrat or a Republican thing, it’s just the law of economics,” Davis said.
Doctors who spoke in favor of getting rid of the process said smaller providers may want to provide a service but then a hospital system will object to effectively veto the plan.
Dr. Robert Brown, who is an ear, nose and throat physician in Greenville, added hospital systems may object to each other’s projects just to horse trade with one another to allow each other to build a facility or offer a service.
“The small businesses like mine who pay taxes are actually unable to play in that sandbox. I don’t have an in-house legal team to fight these battles for years. And if we’re tied up in court, we cannot risk the investment,” Brown said.
The South Carolina Hospital Association has pushed for a reform of the process, by exempting construction projects of less than $5 million and equipment purchases of less than $2 million, from the certificate of need process. That change would reduce about two-thirds of certificate of need applications, the hospital association said.
A proposed amendment on Wednesday with those changes was voted down by senators.
The hospital association also called for limiting the amount of time legal reviews could take to 12 months, down from 18 months.
Both Lexington Medical Center and Prisma Health System supported reforms to the process rather than outright repeal.
“We believe reforms can enhance the delivery of health care throughout our state and ensure that all community members have access to the best care possible,” said Jennifer Wilson, spokeswoman for Lexington Medical Center.
This story was originally published January 12, 2022 at 4:51 PM with the headline "SC could make it easier for hospitals to build in a new location, opening access to patients."
