Certificate of Need repeal passes major legislative hurdle

A proposal that would improve access to healthcare services and reduce medical costs passed a major legislative hurdle this week. The bill (S.164), advanced by the House Medical, Military, Public and Municipal Affairs Committee on Wednesday with amendments, would largely eliminate state Certificate of Need (CON) requirements for healthcare providers, a key priority on our 2023-24 Legislative Agenda.

CON requires healthcare providers to go through an extensive approval process before constructing or expanding their facilities or purchasing certain equipment like hospital beds. In South Carolina, competing providers can also challenge the requests, often resulting in much-needed healthcare facilities being held up for years.

While opponents have argued CON is necessary to contain costs and reduce wasteful spending, research on the subject paints a different picture. A study by the Mercatus Center found that CON laws are associated with higher spending and less access to rural hospitals. It also found that various mortality rates are higher in states with CON regulations.

South Carolina already ranks low in healthcare, so getting CON repeal across the finish line should be a top priority as we close out the legislative year.

We should note that one amendment adopted by the House 3-M Committee would largely keep CON requirements in place through 2026. We recommend this sunset provision be scrapped so CON can be repealed immediately.

The next big hurdle for the S.164 is passing the House. Once that happens, and if the Senate insists on its version, the bill will go to conference committee, where lawmakers from both chambers will need to reach an agreement. With just two weeks left in the regular session, the House must act quickly if this much-needed legislation is to become law this year.