S.C. House votes to end CON health care regulations

The S.C. House voted to end complex health regulations known as Certificate of Need.

COLUMBIA — The end to a complex tangle of regulations that opponents say adversely affects South Carolinians’ health care choices may be near after an overwhelming vote by the S.C. House of Representatives on Wednesday.

The so-called Certificate of Need law would end in 2018 under a measure passed 103-1. The CON requires providers and hospitals to apply for permission from the state to buy equipment, expand facilities or open new ones. The rules are complex, so big hospital systems often try to tie up decisions in drawn-out lawsuits, keeping competitors from opening facilities or buying equipment.

Rep. Jim Merrill, R-Charleston, and others argued that ultimately those decisions should be made by consumers in a free market, not the state.

Merrill, who has long fought to end the program, said he remains skeptical about whether the law will ultimately be killed. Powerful lobbyists for big hospitals have fought changes and have managed to ultimately sway lawmakers in past debates, he said.

“I still think these guys (lobbyists) will spring into action and find a way around the 2018 sunset,” Merrill said. “It’s the big business that ends up winning.”

Allan Stalvey, the S.C. Hospital Association’s chief lobbyist, said he would push lawmakers to extend the sunset date as the bill moves to the Senate.

“We would have preferred a later sunset date. We would have actually preferred no sunset date,” Stalvey said. The association’s main goal, he said, was to ensure that Certificate of Need wasn’t eliminated immediately. Stalvey said the association intends to work with lawmakers to eliminate the sunset provision or extend it past 2018.

Merrill brought up on the House floor the fight between two Charleston-area hospitals, Roper St. Francis and Trident Health. The two systems have been locked in a legal battle for years to determine which system, if not both, should be allowed to build a new hospital in Berkeley County. Ultimately, residents in a rural area of Berkeley have no hospital, an outcome Merrill blames on the CON law.

CON is intended to ensure that health care facilities only open in areas where they are needed and facilities only buy necessary medical equipment.

Some lawmakers said they were concerned that ending the state regulation would mean empty facilities and rural-area hospitals that couldn’t compete with larger competitors.

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“We’ll have bankrupt hospitals everywhere, bankrupt nursing homes everywhere,” said Rep. Walt McLeod, D-Little Mountain.

The bill requires one more vote to formally move to the Senate for consideration. Certificate of Need was nearly killed in 2013 when Gov. Nikki Haley vetoed the program’s funding. But the state Supreme Court revived it, ruling lawmakers would have to vote to end it.

Lauren Sausser contributed to this report. Reach Jeremy Borden at 708-5837.