Mr. Koopman and Mr. Stratmann are economists with the Mercatus Center, a think tank in Virginia. They compared the number of outpatient surgery centers per 100,000 residents across multiple states with Certificate of Need laws and those without them. The licensing rules have resulted in less access to care in those areas than might have happened in a free market.
Here are five key points:
1. Certificate of need laws restrict competition in healthcare markets by requiring providers to obtain government permission before adding or expanding facilities and services.
2. Outpatient surgery centers, which are subject to CON licensing rules in 26 states, can provide needed services in areas where there are no nearby hospitals, but are often blocked from doing so.
3. Virginia is one of several states considering reform this year. Two bills aiming to scale back the state’s certificate of public need program cleared the state House earlier this week and are awaiting action in the state Senate.
4. The first bill, HB 193, sets up a three-phase deregulation of COPN for several parts of the state’s healthcare market, including outpatient surgery facilities. The bill is facing stiff opposition from major hospitals in the state, but narrowly passed the House on Tuesday.
5. The second bill contained milder reforms and would leave hospitals under COPN licensing rules. It aims to streamline the licensing process by enacting several changes recommended last year by a legislative study commission. It passed the House 94 to four on Tuesday.
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