How Maine’s certificate of need law could limit patient access to treatment amid coronavirus outbreak
As policymakers and public health officials at the local, state and federal levels prepare and execute a response strategy to the spread of COVID-19 in the United States, certificate of need (CON) laws are coming under greater scrutiny.
Certificate of need laws act as burdensome red tape in the health care sector by unnecessarily limiting the supply of services. In essence, CONs are permission slips from the government that one must obtain before they can build or finance new health care infrastructure. Currently, 35 states and Washington D.C. have CON laws in place.
The goal of CON is to reduce health care costs and spending by limiting duplicative services and giving government the final say on whether a specific service is needed in a particular area. Of course, like most red tape, CON does just the opposite by reducing competition and separating patients from the services they need.
Maine’s certificate of need law is quite expansive. The law requires people to obtain a CON to construct new hospitals, nursing and rehabilitation facilities, cancer treatment centers and more.
Activities regulated under Maine’s CON law include acquiring major medical equipment, offering a new health service, constructing, developing or establishing a new health care facility and changing bed capacity. A CON is also required to make any capital expenditure greater than $10 million or a capital expenditure greater than $5 million for nursing facilities.
As noted by Justin Haskins of The Heartland Institute in a recent opinion piece published in The Hill, one particular concern with CON laws as it relates to the outbreak of COVID-19 in the United States is the availability of hospital beds. This is no different for Maine.
Patty Wight discussed this same issue last Friday on Maine Public. According to the Harvard Global Health Institute, there are roughly 3,600 hospital beds in Maine, 300 of which are in intensive care units. ProPublica released modeling last week using Harvard Global Health Institute data to determine if hospital regions are ready to handle the coronavirus if large swaths of the population become infected.
Under a best case scenario, meaning 20 percent of adults are infected over 18 months, the state’s current hospital bed capacity could handle the influx of coronavirus patients. However, in the moderate and worst case scenarios (40 and 60 percent of adults infected over 18 months), Maine will not have enough beds available to treat coronavirus patients. If 20, 40 or 60 percent of adults became infected in 12 months or less, Maine would have a significant health care emergency on its hands.
According to ProPublica’s analysis of the data, Portland had 2,520 total hospital beds in 2018 of which 72 percent were occupied, leaving 710 beds open for new patients. Approximately 210 of those beds are in intensive care units.
In a scenario where 40 percent of adults contract COVID-19 over a span of one year, Portland would undoubtedly have to expand its capacity because the influx in patients would require 3.5 times the number of beds available.
During a press conference Monday, the director of the Maine Center for Disease Control and Prevention, Dr. Nirav Shah, said Maine has just 71 ICU beds available statewide.
In other words, if social distancing efforts fail to stop the rapid spread of COVID-19 in Maine, our state will not be equipped to treat patients. This would be disastrous for residents of Maine, the oldest state in the country by median age, because elderly patients have much higher fatality and hospitalization rates from the virus.
A 2013 analysis by Maine Policy Institute found that Maine’s CON law reduces access to care and increases costs. In comparing the 10 states with the fewest hospital beds per 1,000 residents to the 10 states with the most hospital beds per 1,000 residents, the report found that the expense per inpatient day is $878 more expensive in states with fewer hospital beds. Ultimately, restricting supply has the perverse effect of raising costs.
The report concludes, “CON injects a bureaucratic approval process in the path of health care investment… The Maine CON law protects incumbents and inhibits innovation… Free markets lead to higher quality and lower cost, a fundamental principal that must be restored to health care. Government intervention, such as Maine’s CON law, undermines market forces to the detriment of healthcare consumers.”
As noted by Matthew D. Mitchell and Anne Philpot of the Mercatus Center, hospital staff, not bureaucrats, should decide how many beds a health care facility needs.
“By limiting the number of certificates awarded and by making the application process long and expensive, states have made care less accessible and more costly—even though CON statutes are supposed to do the opposite,” Mitchell and Philpot write.
A Mercatus report published in February concluded that CON laws limit access to health care services, degrade the quality of service and actually increase costs for states.
According to the report, patients in CON states have access to fewer hospitals and hospital beds per capita, dialysis clinics, ambulatory surgical centers, medical imaging services and hospice care facilities. Access to care is even worse in rural areas, like Maine, that have CON laws in place.
On the quality front, the Mercatus report suggests that patients in CON states have higher mortality rates following heart attacks, heart failure and pneumonia, and that patients in states with four or more CON laws have higher readmission rates following heart attacks and heart failure, more postsurgery complications and lower patient satisfaction levels.
In addition, the report found that costs per procedure and and spending per patient are higher in CON states than non-CON states. In summation, in each area where CON laws seek to provide value to patients and the overall health care system, they fall short of their intended goals.
“State policymakers who wish to increase patient access to high-quality, lower-cost care would be well advised to eliminate their entire CON programs,” the report finds.
Virtually everything we hear as it relates to this crisis comes back to hospital capacity, beds, access and the supply of medical equipment and services. Repealing Maine’s CON law would give health care facilities the flexibility they need to immediately respond to a health care crisis like COVID-19 while giving patients access to the potentially life-saving care they need to overcome the virus.
Let’s not reduce access to care during a public health crisis by keeping these outdated rules in place.