Georgia Court Upholds Roadblocks for Doctors Expanding Their Practices and Buying New Equipment

Phoenix—The Georgia Supreme Court has upheld the state’s anti-competitive “Certificate of Need” laws that allow hospitals to veto new competitors. This lawsuit challenges an outdated law that makes it harder for doctors to expand their medical practices and buy new equipment like MRI and CT machines.

The Certificate of Need laws require doctors to apply to the Georgia Department of Community Health for permission before they can add space to serve more patients or buy certain new medical equipment. But the Department allows healthcare providers who don’t want more competition to object to new applications. Thirty-six states and the District of Columbia have similar Certificate of Need laws in place.

“This decision put profits over patient care. Georgia hospitals can still use the Certificate of Need bureaucracy to veto new options for care,” said Jim Manley, one of the Goldwater Institute attorneys who filed the case. “Bureaucrats will continue to restrict access to quality care.”

The Goldwater Institute represents Hugo Ribot and Malcolm Barfield, OB-GYN surgeons who own the Georgia Advanced Surgery Center for Women, in Cartersville. Dr. Ribot and Dr. Barfield wanted to serve more patients by adding a second operating room and letting other surgeons use their facility on the days when they are busy delivering babies. When one of the doctors doesn’t have a surgery scheduled, the state-of-the-art facility goes unused. Having other surgeons use the surgery center when Dr. Ribot and Dr. Barfield are delivering babies would help cover the facility’s overhead costs and give more doctors and patients access to a surgery center close to home.

But the Georgia Department of Community Health turned down their application, saying that because the center isn’t already used every day, there’s no need to allow other doctors to use the facility or add another operating room.

Certificate of Need laws were mandated by the federal government in the 1970s as a way to reduce healthcare costs; but evidence demonstrated the laws did the opposite: they restricted access to care and raised costs. The federal government repealed its Certificate of Need requirement in 1986. The Department of Justice and Federal Trade Commission released a statement encouraging all states to repeal their certificate of need laws, calling them a “detriment” to patients.

The total negative impact of the Certificate of Need laws on healthcare in Georgia is well-documented. Dr. Thomas Stratmann of the Mercatus Center at George Mason University presented evidence to the court that Georgia’s Certificate of Need laws increase healthcare costs, limit access to care in both rural and urban areas, and reduce quality of care.

“In states that have done away with Certificate of Need laws, we see greater access to lower-cost, higher-quality care,” Said Manley. “Georgia deserves better, and we will continue to fight for healthcare freedom.”

About the Goldwater Institute

The Goldwater Institute drives results by working daily in courts, legislatures and communities to defend and strengthen the freedom guaranteed to all Americans in the constitutions of the United States and all 50 states. With the blessing of its namesake, the Goldwater Institute opened in 1988. Its early years focused on defending liberty in Barry Goldwater’s home state of Arizona. Today, the Goldwater Institute is a national leader for constitutionally limited government respected by the left and right for its adherence to principle and real world impact. No less a liberal icon than the New York Times calls the Goldwater Institute a “watchdog for conservative ideals” that plays an “outsize role” in American political life.