Eliminating Tennessee’s Health Care Permission Slips Will Make the State Healthier, Wealthier

Imagine Kroger having to ask a government board, made up of its rival grocery stores, for permission to open a new store in your town. It is unlikely that Whole Foods and Publix are going to say yes, which would leave most towns and cities with far fewer options for buying their groceries. As absurd as this sounds, this is what happens in Tennessee when a new hospital or home care service wants to establish new facilities and services.

The original idea behind these government permission slips, formally known as certificate of need or “CON” laws, was that these government boards could control costs by making sure facilities and companies didn’t overinvest in facilities and equipment. Not too surprisingly, fewer options for health care have had the opposite effect, and in a rare moment of learning from its mistakes, Congress later repealed the original law that established this system that had required states to follow suit. Yet to this day, Tennessee, along with 35 other states, still have CON laws on the books.

In a recent report, the Beacon Center of Tennessee and Goldwater Institute revealed that Tennessee’s outdated CON laws have left Tennesseans with fewer medical treatment options, including some areas of the state being consistently denied emergency facilities. According to the findings, would-be providers are no longer bothering to attempt to provide new services as evidenced by a dramatic decline in applications to provide new services and facilities – while the state’s population explodes, driving the need for additional services. Areas such as Chattanooga and Cleveland have been the hardest-hit as they are experiencing the highest percentage of denials for new facilities and services.

Read the rest of the op-ed in Center Square.

Naomi Lopez is the Vice President for Healthcare Policy at the Goldwater Institute.
Amanda Hagerman is the Healthcare Policy Analyst at The Goldwater Institute.