Conning the Competition

North Carolina is one of eight states to require CONs across all six broad categories—hospital beds, beds outside hospitals, equipment, facilities, services and emergency medical transport. North Carolina is the only state to have had its CON program declared unconstitutional. In re Certificate of Need for Aston Park Hosp., Inc., 282 N.C. 542 (1973). After that, the General Assembly adopted a new CON regime and expressly included a legislative findings of fact section. See N.C. Gen. Stat. § 131E-175. In addition to North Carolina’s existing 12 service CONs, North Carolina also maintains a catch-all CON. That is, if no specific CON applies, the catch-all CON requires healthcare facilities to obtain a CON to develop or expand any healthcare service if doing so will cost above $2 million. N.C. Gen. Stat. § 131E-176(16)(b).

COVID-19 Response

On April 8, 2020, Governor Cooper issued an order authorizing the Department of Health and Human Services to accept requests to temporarily: (1) relocate beds; (2) add or relocate dialysis stations; (3) acquire medical imaging equipment and (4) operate ambulatory surgical facilities as temporary hospitals. Exec. Order 130 (Apr. 8, 2020). The Order included detailed instructions explaining how healthcare facilities and providers must request approval. Although less burdensome than a CON, the Order still required healthcare providers and facilities to submit to an application process and wait for an approval before expanding capacity to respond to COVID-19.

Application Process

In North Carolina, the CON application process takes approximately 90 days. N.C. Gen. Stat. § 131E-185(a1); 10A N.C. Admin. Code 14C.0205(a). Applications can be submitted at any time throughout the year but are reviewed on batching cycles as set forth in the State Medical Facilities Plan. The fee for a CON application ranges from $5,000 to $50,000. N.C. Gen. Stat. § 131E-182(c). Competitors can intervene in the application process and can offer evidence or argument as to why an application should be denied. N.C. Gen. Stat. § 131E-185(a1)(1)–(2).