Nursing Homes Fight Repeal Of ‘Certificate of Need’ Process

Feb 21, 2017

As Florida's 2017 legislative session prepares to start March 7, the debate about repealing what is known as the "certificate of need" regulatory process has expanded to include nursing homes and hospice facilities — and has touched off a new wave of lobbying by industry groups.

Officials with the Florida Health Care Association, which represents nursing homes across the state, said keeping the certificate-of-need process for nursing facilities has become a top priority heading into the session. During a press briefing Monday, they said repealing the regulations on building new nursing homes would lead to more empty beds in long-established facilities, affecting the operations of those homes.

"We think eliminating CON would be extremely disruptive," says Bob Asztalos, the association's chief lobbyist.

But Gov. Rick Scott and some key lawmakers, including House Republican leaders, want to take a more free-market approach to health care that includes eliminating certificates of need. The decades-old process involves hospitals, nursing homes and hospice operators needing to get approval from the state Agency for Health Care Administration before they can build facilities.

A bill (HB 7) that would eliminate the process for all three types of health-care operations was approved in a 10-5 vote last week by the House Health Innovation Subcommittee. A similar bill (SB 676) has been filed in the Senate.

Certificates of need have long been controversial, and House leaders the past two years have sought to eliminate the process for hospitals. But the proposals have failed to pass, at least in part because of opposition in the Senate.

But Scott, a former hospital executive, last month called for eliminating certificates of need for nursing homes and hospice facilities, along with hospitals, saying such a move would increase competition.

Eliminating the process for nursing homes, however, would come after years of policies that have helped hold down the number of nursing-home beds in the state.

Lawmakers in 2001 approved a moratorium on certificates of need for new nursing homes. Supporters said limiting construction of nursing homes would spur efforts to provide more services to seniors in their communities.

The moratorium was lifted in 2014, when lawmakers passed a measure to allow 3,750 nursing-home beds to be approved over a three-year period. Nursing-home operators have received certificates of need for those beds in various parts of the state.

While the House and Senate bills seek to end limits on new nursing homes, Asztalos said his association is offering a proposal that would allow up to 3,750 more nursing-home beds to be approved over the next three years while keeping the certificate-of-need process. Such an approach, he said, would meet needs for additional nursing-home beds in parts of the state.

In arguing against eliminating certificates of need, industry officials point to a potential impact on staffing as more nursing homes would compete for limited numbers of workers. Rob Greene, CEO of nursing-home operator Palm Garden Healthcare, said staffing would be "watered down" and affect quality of care.