North Carolina is close to delivering long-awaited health-care reforms. Senate Bill 370, which would repeal many of the state’s outdated Certificate of Need (CON) laws, has passed the Senate with strong support. The bill now awaits action in the House Rules Committee, alongside a similar House proposal.
Why Lawmakers Must Act Now
North Carolina has some of the highest health-care costs in the nation. Residents face expensive premiums, deductibles, and out-of-pocket payments. Despite progress in other areas, CON laws remain an obstacle to affordable care. Removing these laws is not just good policy — it is a moral choice based on liberty, competition, and consumer rights.
Understanding Certificate of Need Laws
CON laws date back to the 1970s. They were designed to control health-care costs by limiting duplicate services. Before building hospitals, expanding facilities, or buying new medical equipment, providers must get state approval.
In practice, these laws created a slow, bureaucratic process. Large hospital systems often use CON laws to block new competitors. Doctors and entrepreneurs who want to open new clinics or add services must navigate legal challenges from existing providers protecting their market share.
This is protectionism disguised as policy, and it harms patients across the state.
The Harm Caused by CON Laws
Research shows that states without CON laws have lower health-care costs and better access to care. A 2024 study by economists James B. Bailey and Shishir Shakya found that repealing CON laws leads to more competition, which reduces spending and improves services.
CON laws limit competition. This allows dominant health systems to consolidate power, reduce service options, and raise prices. Rural communities suffer the most, as hospital monopolies use CON laws to block new clinics that could bring care closer to home. Sometimes, facilities receive a Certificate of Need but never provide the promised services. Instead, they hold the certificate to prevent competition.
Currently, nearly 25 types of health-care services and devices in North Carolina require a CON. This includes psychiatric beds, CT scanners, and other essential equipment. Decisions about these services are made by bureaucrats and business competitors, not by the market or patients.
What Senate Bill 370 Would Change
Senate Bill 370 would remove CON requirements for several key services, including:
- Ambulatory surgical centers (ASCs)
- MRI scanners and diagnostic equipment
- Behavioral health beds
- Some cardiac diagnostic services
These areas have high demand. Entrepreneurs and innovators are ready to expand services if the state removes these barriers. The bill does not prevent large health systems from growing. Instead, it allows new providers to compete fairly.
This reform is not about deregulation for its own sake. It is about giving consumers the power to choose their health-care options, free from unnecessary government interference.
The Path Forward
The bill now sits in the House Rules Committee. In the past, many good reforms have stalled here. This time, lawmakers have a chance to break that pattern. Hospital lobbyists will argue that repealing CON laws will cause problems. However, evidence shows the opposite is true.
The market is prepared for this change. Health-care entrepreneurs are ready to provide better, more affordable services. Patients are eager for more choices and lower costs. Now, it is up to the legislature to act.
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