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September 13, 2017

Report: CT Certificate-of-Need laws hurt healthcare cost, quality

By John Stearns

Total healthcare spending in Connecticut could drop an estimated $283 per person without its Certificate-of-Need (CON) laws based on costs in other states with and without CON laws, according to research by the Mercatus Center at George Mason University in Arlington, Va.

The finding is one of several from the center, which has independently studied all states with and without CON laws in recent years.

CON laws, of which Connecticut has 12, require healthcare providers to obtain state approval before they open or expand practices or purchase certain devices or new technologies and have persisted “in spite of mounting evidence from health economists, regulatory economists and antitrust lawyers showing that these laws fail to achieve their intended goals,” the report said.

Extrapolating possible effects on Connecticut if it didn’t have CON laws, the report said the state could have seven more ambulatory surgery centers and 18 more hospitals; lower mortality rates from heart attacks, heart failure and pneumonia; lower readmission rates for heart attack and heart failure patients; fewer deaths from post-surgery complications; higher patient ratings; and more imaging tests at non-hospital locations and less travel out of county for the scans, the report said.

“When you limit competition, you see higher costs, less access to care, lower levels of quality,” said Matthew Mitchell, a regulatory economist at the center who has studied CON laws for about 10 years and provided peer review for the Connecticut research.

He said Connecticut is about middle of the pack in terms of CON law restrictions. Fifteen states have no CON laws, with New Hampshire in 2016 the most recent to eliminate its CON laws, he said. Massachusetts, Rhode Island and New York all have CON laws and Vermont has 30, he noted.

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