Why Certificate of Need Laws Must Go

October 4, 2018

IJ’s challenge to North Carolina’s certificate of need (CON) law marks our third challenge to these kinds of state health care regulations.

Taking on CON laws is a key facet of IJ’s strategy to protect economic liberty and strike down regulations that serve only to protect incumbent businesses from competition. Indeed, we have already secured a significant federal court decision in our challenge to Iowa’s CON law, which held that “naked economic protectionism is an illegitimate state interest.”

These cases allow us to urge courts to not simply defer to the government on economic regulation, and they provide IJ with yet another context in which to take on state restrictions of medical autonomy. (IJ’s case representing Georgia lactation consultants is another example of our efforts on this front.) Meanwhile, these cases are fertile ground to reinvigorate state constitutional protections against monopolies, as our North Carolina challenge demonstrates.

Finally, CON lawsuits enable IJ to build precedent striking down regulatory schemes that have become downright irrational given changed circumstances. CON laws were originally justified as a way to keep the costs of public investment in health care down. Today, however, the way the federal government reimburses for health care has fundamentally changed. What’s more, CON laws apply even to health care investments that are entirely privately financed.

CON laws stand in the way of making health care more accessible and affordable. Fourteen states have already eliminated their CON requirements, and IJ’s litigation will make sure the states where these laws remain in place follow suit.

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