CON-sanity

Much of Missouri is suffering from a healthcare shortage, and unfortunately, the state's hospitals are helping keep it that way. In recent years, two hospitals in northern Missouri have proposed plans to expand the services they provide in the region. Both expansions would represent meaningful improvements in healthcare access for their patients, yet neither expansion is likely to happen. But why not?

In short, the answer is Missouri's Certificate of Need (CON) laws. These laws give the government power to manage competition in the healthcare industry by requiring permission before providers can open certain facilities, expand certain services they offer, or even install certain medical devices.

While being required to ask for governmental permission may sound bad enough, what makes CON laws even worse is that the healthcare facilities that are covered by the state's CON laws help decide whether new competitors are allowed to enter their healthcare markets. It shouldn't be surprising that when given the choice, incumbent businesses prefer less competition nearly every time. Competition means more choices-which in turn lead to lower prices. Artificially limiting supply, which CON laws do, has often been shown to result in higher prices.

So how does this apply to what's happening in northern Missouri? According to a recent article in the Missouri Times, the Hannibal Regional Medical Center asked the state legislature this year for money to build a new radiation oncology unit in Kirksville, which is approximately 100 miles away from its Hannibal location. The Northeast Regional Medical Center (a hospital located in Kirksville) opposed the funding on the basis that the creation of a new medical campus would "cause a duplication in services that could produce a financial hardship for both hospitals."

Apparently, this story goes even further back than this past legislative session. Two years ago, the Northeast Regional Medical Center submitted a CON application for permission to replace a linear accelerator (a machine used for radiology treatments) for its Kirksville hospital. In response, the Hannibal hospital filed an opposition under Missouri's CON laws, effectively barring the hospital from purchasing the device that would allow it to offer better cancer treatments for its patients.

While it's still too early to know what the result of the fight in northeast Missouri will be, it's important to recognize what's happening. As a result of the veto power afforded by Missouri's CON laws, instead of Missourians having greater access to valuable cancer treatments in northeast Missouri, neither the hospital in Kirksville nor the one in Hannibal will be allowed to offer expanded services. In other words, Missouri patients lose.

Unfortunately, sometimes it takes a real-world example to illuminate the costs that Missouri's CON laws impose on the state's patients. It's long past time for Missouri to repeal its CON. As long as the state's incumbent healthcare providers are allowed to pick who their competitors are, Missouri patients will continue to suffer.