Any day now, the Supreme Court will hand down its decision in the landmark constitutional challenge to President Obama’s healthcare reform law. Whether it upholds the law, strikes it down, or finds some middle ground, the decision will surely reignite the raging battle over what the federal government can or should do to expand access to healthcare. It will be heated. It will be acrimonious. And it will be—for people on both sides of it—the wrong fight.
It will be the wrong fight because it will be looking to the wrong place. While it seems like nearly all the energy of the healthcare debate is poured into questions about the federal government, an enormous amount of healthcare regulation is imposed, almost unnoticed, by the states. Put differently, instead of expending all our energy asking what the federal government can do to help increase people’s medical options, we should also be questioning what state governments can stop doing.
The answer is “a lot.” At a minimum, they can stop making it illegal to offer people new medical options. Amazingly, 36 states (and D.C.) actually prohibit people from purchasing certain medical equipment or offering certain healthcare services without obtaining special permission from the government. They are called “certificate of need” or CON programs, and, while everyone’s attention has been focused on the federal government, they have been quietly limiting your medical options—all in the name of protecting the profit margins of established healthcare businesses.
To be clear, CON requirements are not regulations about public health or safety. Anyone who wants to provide medical services still has to surmount all the regulatory hurdles most of us think of when we think of healthcare: Doctors must be licensed by the state, and equipment must be approved by the FDA. The difference is that, in CON states, would-be medical entrepreneurs must obtain additional permission from state bureaucrats who will determine whether new medical service is “needed.”
That may seem like a difficult question—and it is. Usually, we figure out whether a new business is “necessary” the old-fashioned way: We let the business open its doors, and see if it attracts customers. Instead of relying on this tried-and-true method, however, CON states force would-be service providers into what frequently amounts to full-blown litigation over whether their service is truly “necessary”—which is code for whether their service would take any customers away from existing entrenched businesses.
These laws—and the burdens they pose—are actually the relics of an outdated federal policy. Until 1986, the federal government actually required states to have CON requirements in order to receive healthcare subsidies. The feds repealed this requirement after it turned out to be simply a tool for local business interests to keep their competition out of a particular area, but intense local lobbying efforts have kept CON programs in effect in the majority of states. As a result, different states have different requirements—Oregon’s CON requirement only applies to hospitals and nursing homes, for example, while Virginia’s applies to purchases of some medical equipment, like CT scanners, that can cost less than $200,000. But everywhere these programs exist, they have the same, predictable result: Fewer options and higher prices for patients, and bigger paychecks for established businesses.
That is why the Institute for Justice is fighting back. The principle at stake is simple: Patients and doctors, not government officials, are in the best position to decide what medical services and equipment are needed. CON programs get that principle exactly backwards, and by protecting local businesses from competition at the expense of the public, they violate the Constitution as well.
The battle is beginning in Virginia, which has one of the worst CON programs in the entire country. Teaming up with a group of doctors from up and down the East Coast, IJ has filed suit to strike down Virginia’s restrictive CON requirements and allow the state’s patients to start receiving safe, approved medical treatment from whichever healthcare providers they choose. The case, currently wending its way through federal court, will have major implications for the medical autonomy of millions of Americans.
At a minimum, it seems like both sides in the coming acrimonious debates over healthcare should be able to come together on a basic proposition: that, when private citizens want to invest private money in providing patients with more medical options, the last thing the government should do is stop them. And when the inevitable shouting match over the Supreme Court’s Obamacare decision begins, we should remember that state-level officials will be quietly and determinedly making things worse for patients. Perhaps we can spare some shouting for them.
Robert McNamara is a senior attorney at the Institute for Justice. For more information on IJ’s challenge to Virginia’s CON law, visit: http://ij.org/virginia-certificate-of-need-release-6-5-2012.
Source: AFF Doublethink Online | Joseph Hammond
Source: AFF Doublethink Online | Emma Elliott Freire