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Healthcare reform bill clears legislature with focus on certificate-of-need laws
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Healthcare reform bill clears legislature with focus on certificate-of-need laws

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A less-is-better approach has worked for three state Republican senators in getting at least one healthcare reform bill through the legislature.

On Monday, the state House approved Senate Bill 462 by a 100-3 vote. The bill passed the Senate by a 48-1 vote on May 5.

SB462 has been sent to Gov. Roy Cooper, who has 10 days to sign or veto the bill, or let it become law without his signature.

The bill focuses on limited changes to the state’s controversial certificate of need (CON) program.

The N.C. Healthcare Association, which typically opposes bills that would weaken or eliminate certificate of need laws, said it did not oppose SB462.

The state must issue a certificate of need before a health care system or other medical provider can build a facility, buy equipment or offer a surgical procedure. It affects 28 health care sectors. The law took effect in 1978.

The primary goal of the law is to prevent unnecessary duplication of services within a community or region as a means of controlling costs.

GOP leaders have attempted to repeal the laws in recent sessions, only to have the more comprehensive bills not advance out of committee.

The limitations that result from the state’s CON program have helped fortify the revenue streams of not-for-profit health care systems, such as Atrium Health Wake Forest Baptist, Cone Health and Novant Health Inc.

Opponents of the program claim that adding competition, particularly from for-profit groups, would lead to new services and facilities, including more acute-care hospitals, diagnostic centers and rehabilitation centers.

They say competition would force more providers to lower fees for high-risk procedures. Several cost-comparison websites have shown the costs of some of those procedures can vary by tens of thousands of dollars within a region.

Advocates for the certificate of need program say ending the law would allow for-profit groups to cherry-pick the most profitable medical procedures. They say that would leave not-for-profit hospitals handling the sickest patients, who often don’t have health insurance, in their emergency departments.

Senate Bill 462

SB462 would go into effect Oct. 1 if signed into law.

Instead of trying to weaken or eliminate a big portion of the CON laws, SB462 takes aim at two elements of the program.

It would increase the amount health care providers can spend before the certification is required in certain cases.

The spending limit would increase from $500,000 to $1.5 million for free-standing diagnostic centers.

Providers would be allowed to spend $2 million on major medical equipment — instead of the current $750,000 — before the requirement kicked in.

The allowed amount for “institutional health services” centers would increase from $2 million to $4 million.

Health care providers would also have to move more quickly to start building the facilities for which they’re approved. Providers would get four years to start design services on projects expected to cost more than $50 million. It would be two years for less expensive buildings.

The bill allows for deadline extensions, but the certification could expire, which doesn’t happen under current law.

Senate Bill 228

There are two other CON bills that have had movement during the current session.

Senate Bill 228 would allow employers to offer exclusive provider organization (EPO) health insurance plans, which act like a PPO except they do not include out-of-network options.

The House passed the bill Tuesday by a 97-6 vote. The Senate passed the bill by a 48-1 vote on May 5.

Because the House applied an amendment to SB228, the bill has been returned to the Senate to approve or reject the change.

The health insurance plan known as “exclusive provider organization” offers a local network of doctors and hospitals for you to choose from.

It usually comes with lower monthly premiums and a higher deductible and does not cover care outside the network except in an emergency.

“Large self-insured employers already have the ability to offer employees EPO plans, and some in the state do,” the bill sponsors said.

“However, North Carolina law currently does not allow small businesses to offer EPO plans to employees. This bill gives small businesses a lower-cost option.”

A total of 39 states currently allow EPO options.

During the Senate floor debate on SB228, Democratic senators sought assurances that EPO plans were not “junk insurance” that fail to offer preventive care coverage.

Senate Bill 505

Senate Bill 505 requires health care facilities to notify patients if a provider within that facility is out of network.

It also passed the Senate by a 49-0 vote on May 5, but has not been addressed by the House.

The bill would go into effect Jan. 1 if signed into law.

The bill would require hospitals and health care providers to give patients a written notice at least 72 hours ahead of any procedure that would be done by an out-of-network group.

In situations where a 72-hour notice is not possible, hospitals and health care providers would have to notify patients on the day of an appointment or procedure, or as soon as possible if in an emergency.

The goal of SB505 is to keep patients from getting a surprise bill with out-of-network costs.

336-727-7376

@rcraverWSJ

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