North Carolina CON law 'counterintuitive,' judge says in ASC ruling

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North Carolina Court of Appeals Judge Richard Dietz questioned the basic premise of the state's certificate of need law during oral arguments for an ASC case, Carolina Journal reported Oct. 5.

"Even the fundamentals of the certificate of need regime are somewhat counterintuitive," Dietz said during the Aug. 10 oral arguments. "If you were explaining to someone, 'We're going to limit competition in order to reduce prices,' they would say, 'What? You just said that backward.'"

The court unanimously ruled that Raleigh, N.C.-based Bone and Joint Surgery Clinic can keep the CON that allows it to operate an MRI scanner. A competitor, Raleigh, N.C.-based Wake Radiology Diagnostic Imaging, attempted to block Bone and Joint's CON because it said Bone and Joint didn't go through the standard CON process. 

North Carolina law states that before a new piece of medical equipment is purchased, state regulators must issue a need determination. After that, the law typically allows all interested medical providers a chance to apply for the right to acquire it.

Wake Radiology said Bone and Joint used a "loophole" to skirt that requirement — an argument the court seemed to agree with on Aug. 10, while later maintaining that state legislators exclusively bear the responsibility for closing such a loophole.

Wake Radiology can appeal the ruling to the North Carolina Supreme Court.

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