Opening or expanding a new hospital in Tennessee just got a bit easier. State law requires health systems to prove their new facilities are needed. But this week lawmakers updated those rules, in part because of hospital closures in rural communities.
Unlike many businesses, reviving a hospital is a big bureaucratic lift. And obtaining what’s called a “certificate of need” from the state is one of the hassles. Sen. Page Walley, R-Bolivar, has several hospitals in his West Tennessee district that have been unable to reopen.
“This is going to relieve one of those impediments,” Walley said during the vote this week on final passage. “They are not going to have to go through that multi-month or even year process.”
The new law passed by the legislature, Senate Bill 1281, exempts the state’s most distressed counties from the certificate of need program.
Otherwise, the legislation — which took several years of negotiating with interested parties — is intended to streamline and modernize the process. It consolidates two oversight bodies and makes some attempts at updating rules to reflect the state of modern medicine, such as how to handle outpatient addiction treatment.
There have been efforts to do away with certificates of need, which don’t exist in Texas and 11 other states. The process has often been accused of stifling competition. Especially as more health systems try to build free-standing emergency departments, certificate of need laws have prevented some expansions in the Nashville area.
But Tennessee will continue to require hospitals, nursing homes and even hospice agencies to show there’s a need for their services in the area and to allow competitors to object.
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