Hypocrisy In SC “Certificate Of Need” Debate …

HOSPITAL POLITICS AS USUAL …  Last year this website dispensed some rare praise to the S.C. House of Representatives for its overwhelming vote (103-1) to get rid of the state’s controversial “certificate of need” (CON) hospital regulation program. “This onerous, invasive program requires hospitals to demonstrate a market need prior…


Last year this website dispensed some rare praise to the S.C. House of Representatives for its overwhelming vote (103-1) to get rid of the state’s controversial “certificate of need” (CON) hospital regulation program.

“This onerous, invasive program requires hospitals to demonstrate a market need prior to building new facilities, establishing certain new services, making certain capital expenditures or purchasing certain new equipment,” we wrote at the time. “We reject such government intervention on principle … and have consistently opposed this program as another example of taxpayer-subsidized meddling with the free market.”

Another frequent target of our criticism – S.C. governor Nikki Haley – opposed funding for the program in 2014 prior to being overruled by the S.C. Supreme Court.  Of course we can’t forget Haley was busted lobbying lawmakers in favor of a certificate of need while she was a member of the S.C. House of Representatives.

Making her recent opposition to the program more than a little hypocritical …

To her credit, though, Haley has pushed the issue – getting both the Federal Trade Commission and the U.S. Department of Justice (USDOJ) both to weigh in against the program, which is administered through the S.C. Department of Health and Environmental Control (SCDHEC).

Unfortunately, the repeal of this ridiculous program has run into a roadblock in the State Senate.  One reason?  The state’s liberal mainstream media appears to be totally on board with the program.

“There are good reasons not to simply allow the free market to dictate how health care is dispersed in the state,” the left-leaning Rock Hill Herald editorial board wrote earlier this year.

Right … because government clearly has a better track record when it comes to running things in this state.

Of course the real reason this “CON” continues to remain in place is special interest pressure … the sort applied by lobbyists on behalf of their exceedingly well-heeled hospital clients who support the existing antiquated, anti-free market, politically-driven regulations.

Take Palmetto Health, which through its lobbyists is proposing an amendment (.pdf here) to the current CON creating a carveout for its proposed heart center … even as it lobbies to preserve the system’s broader anti-competitive regulations.

What gives?  Why not just support the CON repeal?

Easy: Because Palmetto Health knows it can game the system anytime it wants – getting the approval it needs for its projects while shutting the door on competitors looking to expand.

This is special interest-driven politics at its worst: Creating (or maintaining) draconian government regulations against an entire industry – and then completely ignoring these regulations when a wealthy special interest comes calling.

It is the definition of playing political favorites – of government picking winners and losers in the marketplace.

S.C. Senator Tom Davis has been an ardent opponent of this program … dating all the way back to his time in the office of former S.C. governor Mark Sanford.  Our hope?  That he can convince his colleagues in the Senate to follow the lead of the House and do away with this program once and for all … something that should have happened years ago.

It is not government’s job to keep health care costs low … it is the free market’s job.  In fact, every time government steps into this marketplace in the name of “affordability,” the end result is always higher health care costs.

South Carolina’s “CON” doesn’t protect health care consumers – it preserves profit margins for select special interests looking to continue sneaking their “exemptions” through the back door of the people’s house anytime they please.

It’s time to shut this program down once and for all …


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RogueElephant March 21, 2016 at 10:58 am

Another example of : “Govt. can’t fix your problem. Govt. IS the problem.” SSDD.

Flip March 21, 2016 at 11:06 am

“It is not government’s job to keep health care costs low … it is the free market’s job.”

The health insurance industry is doing a bang up job of that for the past 50 years. People taking higher and higher deductibles as temporary relief from the ever tightening noose of our health care system’s skyrocketing prices. I think between the money-hungry insurance companies, the price-gouging hospitals, and the pill-for-everything pharmaceutical industry, the free market is not your helpful little buddy when it comes to going to the doctor.

upstate March 21, 2016 at 12:28 pm

except for that they aren’t allowed to compete in a true open market. open up the state borders for health care, and lower the bar for entry into the market, and you will then, in fact, have a true free market, and the benifitial forces that comes along with it.

Nat March 21, 2016 at 1:53 pm

I don’t understand how it would work. Would insurance companies in other states contract with all the doctors, labs and hospitals in all 50 states? What about pricing? Surgery in SC is going to be a lot cheaper than say in NYC. What about coverage? ABC insurance in Idaho when reading the fine print (which most consumers do not understand their coverage anyway) will not pay for some procedure that another insurance company in another state will cover. It sounds like this across state lines is simply doing away with any insurance regulations. Would possibly this would lead to driving all the other insurance companies out of business, and leaving only the top dogs in the market. United Health and Blue Cross. I would love to find an affordable health insurance policy. But I would hate to buy a cheaper one in Montana and find out down the line, a needed treatment isn’t covered or they are only going to pay a fraction of it.

Bible Thumper March 21, 2016 at 2:00 pm

You have the erroneous notion that state regulators can figure this all out better than insurance companies and their customers.

Nat March 21, 2016 at 2:32 pm

If customers were savvy enough to understand insurance coverage and had a crystal ball. I’m pretty well informed on what my insurance will and will not pay for,- but till last year I had no idea that my BCBS policy will not pay for an ambulance unless they have a contract with them – even if 911 was the entity that directed that ambulance service to you. And when I purchased this policy ambulance services was included in it, but that little sentence about in network coverage didn’t sink in. Now if I had a history of having to use ambulances I would have paid closer attention to that clause…and maybe made a different decision.

upstate March 21, 2016 at 2:39 pm

direct billing to the consumer, reimbursed by the insurance company, would pretty much solve this.

Nat March 21, 2016 at 3:02 pm

BCBS isn’t going to reimburse for something they don’t feel is a reasonable fee just because the customer is billed directly. Which I assume is part of the reason for the contracts they make. I have no idea who determines what a reasonable fee is. But is one suppose to barter about years in advance before their heart attack for the best price? Is someone really going to call up 4 different ortho docs for the lowest price before having their broken leg fixed? These type of healthcare issues aren’t like shopping for a car.

Tom March 22, 2016 at 10:15 am

This is an absurdly wrong comment.

upstate March 21, 2016 at 2:38 pm

why is that any different from any other insurance coverage. your homeowners insurance doesn’t have outstanding contracts with specific builders to repair/replace your home in case of a fire. same with your car insurance, while they do sometimes have contracts with specific body shops, you are not required by law to use them.

there are already plenty of dr’s that don’t file insurance, but will provide you with the paperwork for reimbursement. this is the correct model, as it cuts out a lot of the administrative burden in the dr’s office itself, and shifts it to the consumer, but when the consumer does the work they aren’t on the clock. overall, this would cut down on healthcare cost vs the direct billing model by approximately 1/3.

bottom line, if the insurance companies want to set up such contracts, they would be welcome to do so, and would have to put the infrastructure in place internally, or operate without it, their choice. regardless, it will bring more players to the market, which will be good for the consumer.

Nat March 21, 2016 at 2:51 pm

Not one doctor, hospital, lab have ever told me to file my own insurance in the last decade. All of them use computers now to file the claims. So I’m not sure how direct billing to the patient is going to bring about cheaper premiums.
Granted I don’t understand this contracting that goes on between insurance companies and healthcare providers – but if I go to my local ER and don’t have insurance, my bill will be almost double than being insured. At least that’s what the copy of my EOB with the claims state. Same thing for labs and doctors. The lab bills $230 for some test, but BCBS shield’s contract with them only allows $75 for it.

Flip March 21, 2016 at 3:53 pm

There’s no way to know. I went to the hospital once recently and got a bill mailed to me three or four months later. Just one part of what was done cost over $1,600 and my insurance “negotiated” it down to around $400. So the hospital can charge four times what a procedure is worth just because? The only way I can get a fair price is to buy insurance from a large company that has the power to yank thousands of customers away by labeling the provider as “out of network”? If I am prescribed something how do I know I’m being given a legitimate prescription when pharmaceutical companies pay people to go to doctors’ offices all the time to give them free stuff for pushing pills?

I can sympathize with upstate in that government does tend to protect these blood sucking vampires occasionally but if all you do is pull government out and leave the vampires alone, you’re still going to get bit after sunset.

Nat March 21, 2016 at 5:00 pm

It’s a racket that’s for sure. For all the money I have spent the last few years on premiums and out of pocket costs, I could have bought a new Mercedes or other luxury automobile. Something is incredibly wrong when it costs more from health insurance than housing. There was a day when your mortgage was your biggest expense.

upstate March 21, 2016 at 3:59 pm

it isn’t common, but is becoming more so. Once the consumer is responsible for “1st dollar” for their health cost, cost overall will go down……significantly. This is already occurring for with many of the high deductible HSA tied policies, which are becoming very popular with moderate-high income small business owners. essentially they are responsible for everything up to a certain $ amount, and insurance kicks in from there. it is supplemented by allowing deposits into a health savings account pre-tax (no, not the same thing as a flex spending account, completely different animal). The consumer then just pays for their standard office visits (and can usually get a discount for paying in full up front if they have any negotiation skills at all). By doing this, you pay when you go in for a common cold (usually less than $100), etc., but are protected if something bad happens. At the same time, unused HSA funds can be rolled into tax preferred mechanisms if they go unused.

Nat March 21, 2016 at 4:36 pm

High Deductible Plans and HSA accounts are not new. That option works well for healthy and younger people. Not so sure about families with kids or folks over 50. Probably have more people delaying getting seen about a health issue than actually shopping around for a health bargain or negotiating for a better price.

Tom March 22, 2016 at 10:15 am

HSA are not popular at all. People take them because they are what they can afford, not because they want those products. No one wants negotiate with doctors for the best price. The truth is there is no negotiation with doctors and hospitals by an individual. First you have no idea what is reasonable. Second you have no market power. The doctor is not going to discuss his charges with you.

Further, these policies cause people to delay having medical treatment. They cause people to ignore symptoms they should have checked out, because of the cost.

How do I know, you may ask. Because I have one. And it sucks.

Flip March 21, 2016 at 2:00 pm

Opening up state borders would just create stronger, centralized health insurance corporations that would have even less regulation and even more power to screw us all.

Doesn’t fix enormous hospital markups and pharmaceuticals spending billions in marketing and getting doctors to be pill pushers, both of which are standard operating procedure for the health care market.

cuvinny March 21, 2016 at 2:03 pm

The dumbest talking point, insurance companies can already work across state borders

Flip March 21, 2016 at 3:37 pm

There is no way the current system could ever be a free market anyways. It is a captive market, either you buy in and hope you don’t get screwed or you opt out and hope you don’t get sick or hurt. Either option can leave you out in the streets or bankrupt if something bad happens.

tomstickler March 21, 2016 at 3:36 pm

“It is not government’s job to keep health care costs low … it is the free market’s job.”

Silly me: all this time I thought the “free market’s job” was to maximize profits for the owners and shareholders.

TroubleBaby March 21, 2016 at 4:11 pm

Did you see in Janet’s speech the other day she declared “The Phillips curve is alive”?….lol….add an exclamation point and it’s like “Young Frankenstein”:

Crooner March 21, 2016 at 11:54 am

And exactly what has happened to health care costs since hospitals became “for profit” ventures?

Kirby March 21, 2016 at 4:03 pm

real inflation in medical costs came when Medicare (CMS) started setting prices and competition disappeared

ELCID March 21, 2016 at 11:57 am

I served on the 3 Rivers Hospital Board back in the 1980s, as the only business person on that board. From that experience, I can tell you with total confidence, we need an honest Medical Approval Board filled with business people who have common sense.

I caught the Lexington Hospital several times trying to run thru projects that filled no medical needs other than putting money into medical drug and equipment sellers hands and leaving the Lexington Cty. taxpayers to foot the bills for decades of building, maintenance, personnel, and etc. expenses.

One of the worse was the outrageous taxpayer rip off of the supposedly necessary Lexington Hospital Heart Center. We already had 2 hospitals providing that service.

Another case is the useless Palmetto Health Partridge Hospital. Completely unnecessary and designed mostly to get outpatient money from insurance companies. They won’t even accept medicare and other types of insurance. What was actually needed was an Urgent Care Trauma Center. We only have one in the entire area.

This is what you get without oversight.

Nunya' March 21, 2016 at 12:07 pm

You are absolutely right. Also, sometimes that’s what you get “with” oversight too. Too much politics in hospital boards. Too many favors being paid to unqualified people.

shifty henry March 21, 2016 at 12:13 pm

What is the name of the health review system that included about 14 counties in central SC? I was on that board at its inception but I can’t remember the name. I’ll give you my story as a business man on that experience, which was about the same time as yours.

lad March 21, 2016 at 2:30 pm

So if one has a heart attack in Batesburg…you would prefer them to die in rush hour Columbia traffic rather than receive life-saving cardiac intervention at LMC?

ELCID March 21, 2016 at 4:51 pm

It’s only 7 miles away!!
Same Traffic to Lex. only worse.
Try Hwy 378 in rush hour.

But, in a Trauma situation, those 7 miles could mean life or death.
Lex. Hop. has only minimum trauma emergency room service.
Usually, they just transfer you to Richland Memorial (those folks are our real heroes).

We need a Trauma Center at Lexington or Partridge: not just another outpatient money machine paid for by the tax payers.

Yelsewh March 22, 2016 at 9:02 am

LexMed will never open a trauma center (or a NICU) because there’s no money in it and they’re all about making money.

ELCID March 22, 2016 at 11:52 am

Exactly right!!!

Service to humanity,
Saving lives,
Doing the right thing,

All seems to be secondary to greed.

Thank the only people really saving lives on a day to day basis.
The ER and trauma unit at Richland Memorial.

If you are your family are ever seriously injured or sick: always go to Richland.

But, because of these rotten hospitals like Parkridge, the ambulance guys have to go to the nearest hospital: regardless of capability. People are literally dying while under transport between hospitals. I had one friend end up in an ambulance for over 8 hours, stuck between Partridge and the care he needed at Richland. TERRIBLE, and CRIMINAL!

PLUS, Nicky Haley is directly responsible for many of these deaths by her illegal political coverups at Lexington Hospital. Where she got a direct payoff for a job she never showed up for. Plus, illegal lobbying, and bribes from engineering companies. She’s the “witch devil,” of Lexington County. The main evil that has caused much of this outrageous hospital construction at for profit not service hospitals.

Yelsewh March 22, 2016 at 9:30 pm

Palmetto Health needs the insured population that visits Parkridge to offset losses at Richland.

ELCID March 23, 2016 at 5:33 pm

Strange how when these hospitals were all owned by the counties and religious organizations, they never lost a dime. Yet, when the corporations purchased them, suddenly they are losing money: COW MANURE.

Yelsewh March 24, 2016 at 4:44 pm

The only local hospital owned by a for-profit is Providence.

ELCID March 26, 2016 at 6:04 pm

Negative. Providence sold several years ago to a for profit company by the Catholic Sisters. It’s for profit now.

Richland Memorial was formerly owned by Richland County. It was sold years ago to a for profit along with the combined old Baptist Church Hospital. That now includes Parkridge.

Lexington Hosp. is owned by Lexington County. But, it is run as a for profit operation.

Yelsewh March 29, 2016 at 9:41 am

Providence was sold last year, not several years ago.

Richland and Baptist (and now Tuomey) form Palmetto Health which is a non-profit. Parkridge is actually an offshoot of Baptist. Baptist owned the land prior to the formation of Palmetto Health and the beds at Parkridge were transferred from Baptist.

Lexington Medical Center is part of the county government. It is a non-profit but yes, it does make money… mainly because it serves a commercially insured population and it avoids unprofitable services.

ELCID March 29, 2016 at 9:59 am

You make some good points.

The Providence Deal has been on going for several years.
It may have just officially closed last year, or in 2014.

Richland Etc. is only a non-profit in disguise.
It operates under the same rules as Humana and all the rest.
Profits before people.
Richland is the best of the group.
It has an excellent Trauma Center and tries its best to do the right thing.

Richland and Baptist are the same Hospital system. Don’t be confused by that deal.

Partridge is a Hospital that should never have been built.
It serves on the wealthy and won’t even accept many types of insurance or Veterans Insurance. I doubt it even takes Medicare across the board.

Lexington operates as a fund raiser for special interest groups.
It’s a money maker for them at the Lex. Tax Payers expense.

not buying it March 21, 2016 at 12:03 pm

Many hospital systems have facilities/land/other stuff given to them by local governments, you know, for the greater good. They also enjoy tax advantages from local/state/federal govt. They need to be supervised to protect the investments that the public has made in them, IMO. The CON is one way to do that.
It still doesn’t stop them from building ridiculously expensive buildings and buying out every independent Dr, but it’s something.

Bible Thumper March 21, 2016 at 12:52 pm

No one can really explain how free markets work, yet all you need to do I go to Venezuela or Cuba and measure the results. Some even today praise Cuba’s healthcare results, but it is gained at a severe cost to the rest of the economy. Commenters here believe that they are smarter than the average person and so of course can make better decisions than unorganized citizens making decisions for themselves.

The fact is that private institutions have found that it is sometime best to invest in services even if they lose money. A heart center may lose money, but actually draw patients to other hospital units. A hospital without a heart unit may have difficulty recruiting doctors and other technical staff.

This happens in the private sector all the time. None of the “smart” commenters here would ever suggest putting a competing drugstores on every corner of an intersection, but the market seems to demand it and they thrive and keep prices low.
Every grocery store bakery does not make a profit, yet it is in their best interest of profits to keep it open. The commenters to this blog can’t admit that the market is smarter than the experts.

TroubleBaby March 21, 2016 at 1:40 pm

Because people plan their own lives routinely, it’s hard for many to accept that central planning fails to some degree all of the time. (they don’t distinguish between planning for their own lives from those that plan the lives of others)

They think to themselves it’s “crazy” to let markets operate without central planning…not realizing that people who are for free markets aren’t against planning, they just think the people closest(and most responsible for) those decisions should be the ones making said decisions- not bureaucrats or elected officials.

It’s impossible(aside from immoral) for a small group of people to successfully plan an economy as well as a large group of people making decisions on an individual basis.

anonymous March 21, 2016 at 1:10 pm

The CON system has been corrupt for 35 years that I have worked with it.

Lone Ranger March 21, 2016 at 3:22 pm

That’s right—payday lending and hospital “certificates of need”…excellent exhibits just why

Your corrupt, flag-ripping SC State AND Federal solons are the best that…MONEY can buy !!!

Flip March 21, 2016 at 3:40 pm

People like you are the ones these parasites love the most,

Ignorant and poor, makes for quite a tasty host.

Lone Ranger March 21, 2016 at 4:05 pm

Flip thought those who support Southern heritage and
patriots’ flag are poor and ignorant, too

But when voters handed him and flag-rippers their heads—ignorance
was theirs—who knew !!!

Joe Bauers March 21, 2016 at 6:09 pm

Ya, I’m a free market guy but the health care system is broken beyond repair and they’ve had plenty of time to get their crap together to no avail. Its a big money grab for pharma, doctors, med schools, insurance companies, hospitals, drug reps and the list goes on & on. Getting employers out of the health insurance business would be a big start to bringing that industry back to earth. Drug ads should also be banned like most countries & drug prices set by the government just like every other nation. Why do we continue to subsidize the rest of the world for their drugs? Thanks Washington.

Mark March 22, 2016 at 9:57 am

Its not thanks Washington, its thanks K Street. Lobbyist are paying politicians big money to keep us the only nation in the world without universal health care. Something we pay dearly for. We pay nearly twice per year what people pay in Europe or Canada pay for health care and we have worse results. The average American lives a shorter less healthy life than the average Canadian or the average Western European.

The CON program is debatable, but it was never designed to keep costs low. It was designed to keep Hospitals from going out of business and leaving areas of the state with no health care. Is it necessary now? Maybe, maybe not. But what is necessary is for the American people to start realizing that they are being duped into paying way more than they should have to for subpar health care.


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