Georgia’s two legislative chambers reached an agreement Thursday to enable more health care centers to open in the state, despite a failed last-minute attempt to pair the measure with an expansion of Medicaid.
The debate had centered on how far the rules governing the establishment of new hospitals should be scaled back. That discussion also led to deliberation over the role of hospitals in providing care, especially in rural areas, and how the opening of other kinds of health facilities could affect them.
New hospitals in Georgia must demonstrate a significant need for care in order to open through a process called certificate of need, or CON. The rules were developed in 1974 to comply with a federal mandate requiring states to regulate new medical facilities to help control the costs of government reimbursements for Medicaid and Medicare.
“If it were up to us, we would abolish the entire CON process,” said Sen. Bill Cowsert, a Republican from Athens. “Sometimes you have to take what you can get.”
House Bill 1339, sponsored by Rep. Butch Parrish, would ease regulations governing the construction and expansion of hospitals in rural counties. It would also shorten the timeline for review of hospitals’ applications and expand the rural hospital tax credit program, giving taxpayers a credit toward their state tax bill if they donate to qualifying medical facilities.
Proponents of repealing CON said that it would allow more Georgians to have closer access to health care, instead of having to drive more than 30 miles for emergencies. They also point to a dearth of obstetrics and gynecological care as well as labor and delivery centers, contributing to a crisis in maternal health. As the state struggles with a mental health crisis, lawmakers pointed to provisions that would allow psychiatric services to expand more easily.
However, rural hospital CEOs and advocates cautioned against full elimination of the program, fearing it would allow more free-standing outpatient care facilities to open, forcing hospitals to compete with them for staff, physicians and patients.
In their initial proposal, Senate Republicans wanted to pave the way to open more of those facilities, also known as ambulatory surgical centers or ASCs, where patients can undergo minor surgical procedures without going to a hospital.
Senators also sought to allow physician groups of different specialties to share operating rooms. When legislators in the House objected, the Senate agreed to allow single specialty centers to share their operating rooms with physicians practicing the same specialty.
Throughout the three-month legislative session, House and Senate Democrats have maintained that to truly support financially strained hospitals Georgia should expand Medicaid, the federal-state health insurance program for low-income people. Doing so would enroll more people into insurance programs and convert them into paying patients, Democrats say, allowing hospitals to make some money when those patients are treated. Georgia is one of just 10 states that have not accepted federal funding to expand Medicaid.
Instead, lawmakers pushed the topic to a study commission that will meet this summer.
Democratic Sen. David Lucas of Macon, who made the last-ditch effort to get Medicaid expansion through the Senate Regulated Industry Committee on Thursday morning, railed against the senators for blocking expansion but later voted for the bill.
Lucas said his support was tied to a provision that would allow a teaching hospital to be exempted from restrictions governing how closely a new hospital could be built near an existing facility. He and other lawmakers are hoping the Morehouse School of Medicine could supply medical student residents to fill the void left by the closure of Atlanta Medical Center in 2022.
Rep. Michelle Au, a Democrat from Johns Creek, raised concern about a section of the bill that would allow an “outside entity” to operate ASCs. Au said she is concerned it would open the door for a private equity firms to enter the market. It’s worrying, she said, because they can “drive up costs and drive down quality.”
Hospital officials cheered the move to relax CON rules.
“While not all of our concerns were ultimately addressed in HB 1339, we appreciate their spirit of compromise, and we remain committed to continuing to work together toward improving health care in Georgia,” Anna Adams, the executive vice president for external affairs at the Georgia Hospital Association, said on behalf of the organization.
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