Why it’s finally time to eliminate all certificate of need laws in Tennessee
By repealing Tennessee’s remaining certificate of need (CON) laws, the state legislature can prevent unelected bureaucrats from further constricting healthcare access and distorting the free market
Jeffrey Mazzella, Guest Columnist
During the 2022 legislative session, Tennessee lawmakers expanded their record of strengthening individual freedoms and fostering a strong economic environment that promotes job creation and growth.
Among numerous accomplishments, Gov. Bill Lee and the legislature passed education reforms putting students first, struck down tax hikes that would have harmed Tennessee businesses, and approved the constitutional ballot initiative protecting workers’ freedom to decide for themselves whether or not to join unions – a right now cemented in our state’s constitution.
This year, as lawmakers seek to build upon last session’s progress, they should begin by fully repealing the remaining “Certificate of Need” (CON) laws that limit healthcare expansion for patients across the state.
CON laws failed to achieve their goals
For readers unfamiliar with CON laws, they require hospitals and other medical providers to obtain special government permission – a costly, difficult and lengthy bureaucratic approval process – by demonstrating a “need” for their services in geographic areas where they propose to build new facilities or offer new care.
States began enacting CON laws in the 1970s, under a heavy-handed mandate by the federal government, with the noble goal of controlling costs and maximizing access to care. That experiment, however, failed. Instead of controlling costs, subjecting the healthcare sector to onerous red tape slowed or prevented private companies from building new facilities or expanding healthcare services to communities in need.
As noted by Mercatus Center Scholars Matthew Mitchell and Christopher Koopman, “Forty years of peer-reviewed academic research...suggests that CON laws have not only failed to achieve their goals but have in many cases led to the opposite of what those who enacted the laws intended.”
Even the federal government recognized the failure of CON laws and repealed its mandate in 1986. Twelve states have subsequently repealed their CON laws completely or allowed them to expire because of the harmful effects.
Here’s how the system is bad for consumers
Here in Tennessee, Governor Bill Lee and the state legislature deserve credit for partially reforming the state’s CON laws during the COVID-19 public health emergency, after recognizing the laws were exacerbating an already dangerous situation.
Hospital systems across the state, especially in major metropolitan areas, operated at or above capacity during the height of the pandemic. The reforms were a way to help expand access and alleviate that pressure on the system.
While those 2021 reforms constitute progress, much work remains. Tennessee still has 26 CON regulations that continue to limit access to care across the Volunteer State.
Tennessee’s remaining CON requirements are governed by 12 government bureaucrats – unelected and unaccountable to everyday Tennesseans – who act as gatekeepers for private companies working to expand healthcare access in the state.
Making matters worse, the process is susceptible to deep-pocketed, insider lobbying whereby entrenched interests like existing hospitals opposed to new competition can block new entrants from receiving CON approval in their geographic region.
Any system that vulnerable to insider influence is bad for consumers and should alarm all Tennesseans. As one CON law critic recently put it, “Imagine if Wendy’s had to get permission from a committee stacked with McDonald’s and Burger King CEOs in order to open up a new franchise.”
Make Tennessee a leader in patient choice and health care access
On a national level, moreover, COVID-19 lockdowns illustrated the harm that unaccountable health officials can cause. Unelected, all-powerful bureaucrats inflicted irreparable damage upon state economies, individual freedoms and school children.
Fully repealing Tennessee’s remaining CON laws will empower patients over government bureaucrats and help the state’s healthcare system be better prepared to handle future public health emergencies.
As someone who relocated to this great state in recent years, I know firsthand how rapidly Tennessee is growing. In future years, that growth will only continue. Over the next decade, Tennessee is expected to grow by approximately 10%, reaching a population of 7.5 million. Accordingly, repealing CON laws is critical to ensuring Tennessee can meet the significant healthcare needs of its growing population – especially in locales where access is already limited.
The 113th General Assembly thus possesses an opportunity to make Tennessee a national leader in patient choice and healthcare access. By fully repealing Tennessee’s remaining CON laws during the 2023 legislative session, the state legislature can prevent unelected bureaucrats from further constricting healthcare access and distorting the free market.
Tennesseans don’t want or need unelected, unaccountable government bureaucrats meddling with their access to care. It’s time to put this issue to rest and fully repeal the state’s CON requirements once and for all.
