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Georgia lawmakers to take new look at hospital regulation

Local hospitals say they’re in danger. Private health care givers say they’re being held back. And the clash between the two is coming to a head.

The years-long battle over the state’s regulation of hospital growth is due for a showdown this year, and state lawmakers are laying the groundwork this month.

Two prominent committees formed by the Georgia Legislature will look at Certificate of Need, the state regulation that manages hospital expansions and startups.

Private health care companies have relentlessly battled to weaken the regulation, also known as CON. Led by Cancer Treatment Centers of America, a private company that focuses on cancer patients, they say the regulations needlessly stymie innovation and expansion of focused, expert care.

Traditional hospitals have fought back just as hard. They say the companies cherry-pick from the few profitable services that hospitals offer. That can leave regular hospitals obligated to provide all the money-losers, such as neonatal care, without the profitable ones — such as cancer treatment and joint replacement surgery — to balance it out.

Legislators may be ready to take action in the session coming up in January if study committees now in the works make headway.

In September, a council headed by two powerful state House members intends to take up the issue in Statesboro. The House Rural Development Council — whose co-chairmen are House Appropriations Committee Chairman Terry England, R-Auburn, and House Ways and Means Chairman Jay Powell, R-Camilla — expects to devote its entire meeting to the issue.

CON has been an issue for Georgia’s rural hospitals since they are often financially vulnerable. At least seven have closed since 2010.

“I get it, I understand it, I know why my friends that are in these rural hospitals that have been struggling every week to make payroll,” England recently told The Atlanta Journal-Constitution. However, he said, “having been in business I realize that competition makes us all better.”

In addition, the Senate has just announced that Lt. Gov. Casey Cagle appointed a private businessman to head the Senate Study Committee on Certificate of Need Reform. The new chairman, state Sen. Ben Watson, R-Savannah, is a physician and entrepreneur who in 2017 tried introducing legislation that would relax CON restrictions on what private practices can provide, which could have allowed his business to expand. Faced with resistance, Watson withdrew that legislation.

This year, Watson introduced the resolution that created the new committee, Senate Resolution 1063. He told the AJC at the time that he believed there was a path to agreement on changes to CON that would work for all sides.

Some local hospital advocates say CTCA got what it agreed to the first time around, when it got a special deal avoiding the CON process so it could set up business in Georgia. Afterward, they say, the company has just asked for more.

The deal that allowed CTCA to open shop in Georgia was struck in 2008. CTCA agreed to certain requirements such as capping the amount of in-state patients it sees and providing at least some charity care. AJC reporting has raised questions about whether CTCA actually does that. CTCA responded that it has done everything in the agreement, and that it is trying to meet demand for its services.

“We’ve met every requirement, we’ve never been on the noncompliant list,” said Ray Williams, vice president of government and community affairs for CTCA, Newnan. “Frankly, this issue is about access to cancer care.”

Advocates on all sides seem resigned to a grinding few months on the issue.

“I think we’re headed to multiple considerations of CON,” said Jimmy Lewis, the CEO of Hometown Health and a lobbyist for a group of rural hospitals, “in view of the fact that for the last three or four years CON has been such a hot topic driven by CTCA.”

The study committees matter, Lewis said.

At the end of the 2018 legislative session, Lewis said, House Health and Human Services Committee Chairwoman Sharon Cooper, R-Marietta, “expressed very directly to the industry that the opposition that it has to CTCA and others should get resolved by the industry; or the Legislature would fix it — whatever that means.”

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