South Carolina may give Certificate of Need repeal another try

South Carolina may gradually do away with a complex set of rules that regulates its hospital industry, according to the Post and Courier.

Palmetto State lawmakers are poised to pass a bill that eliminates South Carolina's Certificate of Need program, which regulates healthcare expansion, according to Allan Stalvey, a lobbyist with the South Carolina Hospital Association. The association's board this week discussed its position on a "sunset provision" to eliminate Certificate of Need over the next five years, which the state House is scheduled to debate.

Under Certificate of Need, providers need permission from the state to buy equipment and expand or open facilities. Larger hospital systems often use the complexity of the rules to tie up potential competitors in protracted legal battles, and eliminating this option would level the playing field, according to supporters of the bill. "We're not going to pick winners and losers," Rep. Murrell Smith (R-Sumter), one of the bill's sponsors, told the Post and Courier. "[Certificate of Need] is just being abused to prevent competition."

Providers like Roper St. Francis CEO David Dunlap, however, are worried that abolishing Certificate of Need could disrupt hospital construction, according to the article. If Certificate of Need goes away, for-profit entrepreneurs could rush into the South Carolina market to compete with full-service providers like his not-for-profit health system, Dunlap said.

The bill would also soften several of the program' rules; for example, hospitals would be allowed to expand pre-approved services and eliminate the requirement that they seek permission to buy equipment costing more than $600,000. Gov. Nikki Haley attempted to eliminate the program once before in 2013 when she vetoed its funding, but the State Supreme Court ruled it could not be eliminated without a vote in the legislature the next year in response to a lawsuit by providers.

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