The West Virginia legislature regularly addresses bills to rescind certificate of need (CON) laws, and Gov. Patrick Morrisey recently pushed for the laws’ repeal. As their name suggests, these regulations force prospective medical practitioners to convince central planners they are needed in the area before they can legally open. Worse, potential future competitors also weigh in on the decision, often shuttering new healthcare businesses before they open. 

Already, twelve states have abolished this protectionist legislation, and the Federal Trade Commission (FTC) urged others to follow. Given CON’s unfairness and unpopularity, how do its supporters in West Virginia justify it? 

The answer is a convoluted mess of contradictory excuses.

“Economic Viability”

Some of the most vocal CON supporters are healthcare administrators. They claim any competition will financially strain their facilities, some of which accept low Medicaid payments and use cross-subsidization from higher-paying patients at other hospitals. 

Jim Kaufman, CEO of the West Virginia Hospital Association (WVHA), decries these “financially motivated” providers who “cannibalize” more lucrative services at the expense of nonprofits. However, at his nonprofit representing 72 hospitals, his published annual earnings on ProPublica total $676,000 in a state where the median salary is $54,100. 

Nobody should begrudge a worker fair market pay, but Kaufman is effectively being paid this staggering fee to legally subvert the market, block competing providers, and prevent residents in care deserts from accessing facilities. The totality of these facts renders his purported humble goal of “economic viability” dubious, and his supposed concern for indigent patients seems questionable.

“Already Doing A Great Job”

Karen Bowling, CEO of West Virginia University (WVU) Princeton Hospital, further argues that current providers are “already doing a great job.” With more than $2.1 billion in revenue, WVU is the largest health system in the state, and ProPublica lists the president’s annual compensation at well over $1 million, so the administrators are indeed thriving. 

However, the patients are not faring as well. WVU itself notes that West Virginia has the highest national percentage of healthcare deserts, with a shocking 84.66% of the population living in one. It ranks lowest in the nation for both physical and mental health, “likely due to lack of available health care.” (Oddly, Candace Miller, also of WVU, says it’s “not fair to say the limited access to care equals poor health outcomes.”)

Not “A Big Deal”

With yet another rationale for maintaining the status quo, some legislators and administrators insist that CON is not a major issue. Speaker of the House Del. Roger Hanshaw recently stated, “I’m not personally convinced that it’s a big deal one way or another.”

With a slightly different approach, but the same casual attitude, David Goldberg, CEO of multiple health systems, argued that multiple facilities under him “went through the CON process and faced no opposition or issues in receiving state approval.” In other words, getting a certificate is easy. 

The 20 providers who gave up their CON attempts in despair from 2017 to 2020 probably do not agree. Hunt Club Urgent Care failed to acquire a certificate and forfeited its application fee when its competitor objected, despite the closest urgent care to Hunt Club being at least half an hour away. 

The nearest facility, which now absorbs that business, was the objecting competitor. 

Summary

According to the purported reasons for maintaining a CON law, it is seemingly too important to remove, yet so insignificant that it doesn’t present a real barrier. Incumbent hospitals already manage needs well, yet patients suffer greatly due to a lack of access, and CON is the solution. It is everything and nothing at once.

West Virginia residents need and deserve so much better than this farcical debate. A sick and underserved population is denied the health care their own taxes are funding, while wealthy administrators insist they have the situation under control.