Certificate of need process: Rationing health care in South Carolina

In most businesses, issues such as location, capacity and services offered are dictated by the marketplace. Businesses respond to demand by opening, expanding, moving or closing locations, as well as the mix of services and products offered by those facilities. 

By and large, this unregulated process works pretty well - but if you're a hospital in South Carolina, bureaucrats, not patients, make the decision about the availability of health care services through the state's "Certificate of Need" process. This system is used to restrict and control the ability of medical service providers to build and operate facilities throughout the state.

From where the Blogland sees it, that system may be good if you're a bureaucrat seeking job security or a hospital looking to block out potential competition, but for patients who want more options for healthcare in your community, it's a bad thing.

The latest example of how this program is used to stifle competition can be found in Berkeley County, where S.C. DHEC issued these figurative permission slips to allow two competing health care providers to build hospitals: Trident Healthcare and Roper St. Francis Healthcare.

Faced with the prospect of competition, Trident filed suit and lost. Now they're saying the inability to have a state-guaranteed monopoly means they can't run a facility profitably and may not open:

Under this scenario, Trident cannot build a hospital in Moncks Corner ... We do not want to be a part of a process which promotes unnecessary spending of health care dollars to duplicate services.

Too bad for them.

By contrast, their competition welcomed the decision to allow both hospitals to open up in Berkeley County:

If the state says two hospitals can be supported, and court in Columbia says the two hospitals are needed, then for the sake of Berkeley County, everyone should come together and agree it’s time to get going ... Let’s put all our differences aside and bring both hospitals that were promised to the people of Berkeley County, the people that need them and deserve them the most.

If Trident - which runs hospital monopolies in North Charleston and Summerville - can't handle a little competition to attract enough patients to stay in business, either there is not enough demand or they're just not good at running a business in a competitive environment. Either way, it's hard to understand where that should be a problem for healthcare consumers.

The Certificate of Need program is nothing more than a taxpayer-funded shield to block competition and give businesses assured monopolies and should be scrapped, giving healthcare providers the freedom to provide the public the most options for the healthcare services they need.

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