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North Carolina CONs Doctors and Patients

Most Americans agree the health care industry faces enormous challenges. Providers are increasingly bound by red tape, costs just keep going up for patients, and lawmakers appear more interested in posturing than in policy. Under these conditions, it can be almost impossible to do a good deed—something Dr. Gajendra Singh knows all too well.

Dr. Singh is a general surgeon based in Winston-Salem, North Carolina. As part of his practice, Dr. Singh sometimes requires patients to obtain scans for diagnosis and treatment. But increasingly in recent years, patients report struggling with the exorbitant costs and lack of transparency of imaging services in the area.

So, in 2017, Dr. Singh decided to do something about it. He opened Forsyth Imaging Center to provide high-quality, low-cost imaging services with transparent prices. Dr. Singh’s goal was to help patients by offering scans at a fraction of the cost of nearby providers. Since opening the center, he has acquired all the equipment he needs to do exactly that—except one machine.

Dr. Singh is allowed to have an X-ray machine, an ultrasound machine, and a CT scanner. But under North Carolina’s certificate of need (CON) law, he is banned from purchasing an MRI scanner because the hospital down the street already has one. So Dr. Singh is teaming up with IJ to challenge the law in state court and vindicate his right to provide these much-needed scans.

Readers of Liberty & Law may already be familiar with CON laws from IJ’s challenges in Virginia and Iowa. A CON is a government permission slip to provide certain health care services. In most states, a provider must demonstrate that a new service is “needed” before obtaining a CON. This can be difficult enough—but in North Carolina, it gets even worse.

Under North Carolina’s law, a provider cannot even apply for a CON to provide certain services unless state planners predetermine a “need” for those services—based on the number of providers already operating. Not only that, the application process can cost hundreds of thousands of dollars and gives established providers an opportunity to contest new applications at every turn.

In 2018, state planners did not project a “need” for a new MRI scanner, meaning Dr. Singh is categorically banned from purchasing one. And even if he could apply for a CON, Dr. Singh could not afford to spend hundreds of thousands of dollars—money he needs to continue providing low-cost scans for patients—gambling on a mere chance to purchase an MRI scanner.

Dr. Singh just wants to provide safe, quality, affordable MRI scans for patients who need them.

Fortunately, the North Carolina Constitution protects Dr. Singh’s right to participate in the health care market. It specifically bans the government from establishing monopolies, guarantees that laws be applied evenhandedly, and protects the right to earn an honest living. In fact, the North Carolina Supreme Court struck down a previous version of North Carolina’s CON law under exactly these provisions back in 1973.

Dr. Singh just wants to provide safe, quality, affordable MRI scans for patients who need them. And he knows that he and his patients—not state planners—are the ones who should be deciding which health care services are “needed.” We look forward to vindicating Dr. Singh’s rights and bringing competition to an area where it is desperately needed.

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