March 20, 2002

The following op-ed piece ran in the Lewiston Sun Journal, March 20, 2002

Maine Should Not Abandon Rational Healthcare Planning

By Steven Michaud

The rising cost of healthcare and Mainers' ability to afford health insurance coverage are dominating discussions in homes and businesses across our state.

With all the concern about the affordability of healthcare, the Maine Legislature is considering a bill that would deregulate the planning and development of healthcare facilities and services. As with deregulation in other industries, the proponents praise the value of competition, free markets and customer choice, but when the dust settles, deregulation rarely brings the benefits promised, except for a chosen few.

LD 1545, a bill that would repeal Maine's Certificate of Need program, will have serious negative implications for Maine citizens' access to healthcare. It also promises to increase the cost of healthcare rather than bring needed price relief.

Thirty-six states, including Maine, have some type of Certificate of Need (CON) law. CON is a regulatory program that requires healthcare providers obtain permission from the state before constructing medical facilities (such as hospitals and ambulatory surgery facilities) or offering certain healthcare services (such as MRI, PET scanning, or cardiac catheterization).

The objective of the CON review process is to prevent unnecessary duplication of healthcare facilities and services, guide the development of services that best serve public needs and ensure that high quality health services are provided. In short, CON provides a means for helping to achieve rational and orderly development of healthcare facilities and services.

What could happen if CON were eliminated in Maine? Deregulation would result in a proliferation of new, for-profit facilities and services that duplicate the services already provided by non-profit, community-governed hospitals.

Would duplication of facilities and services be such a bad thing? Wouldn't competition drive costs down and allow the most efficient to survive and thrive? Unfortunately, when it comes to healthcare, duplication resulting in excess capacity increases healthcare costs. More facilities, equipment and overhead that serve the same patient population when current capacity is adequate, fuels healthcare inflation.

To make matters worse, while this duplication would increase healthcare costs, it also would damage the delivery system of care on which our communities depend.

Maine's community-based, non-profit hospitals meet the needs of all patients, regardless of their ability to pay while providing citizens with "always available" emergency services. Hospitals are open 7 days a week, 24 hours a day, 365 days a year---any and every time we call on them.

Sure, for-profit providers claim they will be a cheaper alternative. But will they be there when you need them, day or night, weekends and holidays? Will they serve those who have no insurance? Will they accept Medicaid patients-all of them? Will it really be cheaper for us all if they duplicate what hospitals are already doing?

When these for-profit providers serve only patients with insurance, those patients are no longer served by the hospital. And when the new facilities spawned by deregulation target procedures where hospitals make money, they will jeopardize hospitals' ability to pay for the unprofitable services like 24-hour emergency rooms where they lose money. The loss of these patients and procedures will seriously erode the financial foundation of Maine's hospitals. If Maine's community hospitals can no longer afford to provide needed, but money-losing services, will the benefits of deregulation ultimately come at too high a cost for our communities?

Repealing CON is too risky when the plusses and minuses are added up. The CON process is far from perfect, but we need to put planning, affordability and access before profit. The Legislature and the Governor must reject LD 1545 and preserve rational healthcare planning in these turbulent times.

Steven Michaud of Topsham is President of the Maine Hospital Association.