Agency Approves Change In C-O-N Rules

By Brandon Larrabee
Morris News Service

(12/14/07) A measure allowing more physicians to open their own surgery centers gained approval Thursday from a key state agency, as hospitals threatened to sue to overturn the change they say threatens their financial health.

The Board of Community Health voted unanimously to allow general surgeons to open the centers without first getting a "certificate of need," which requires major medical facilities and some outpatient surgery centers to show that the services they provide are needed in an area before opening. The certification process is designed to ensure there will be enough customers for each facility to break even while charging reasonable fees.

Under the rule approved Thursday, general surgeons, who focus on abdominal surgeries, would be classified as a "single specialty," a designation many medical associations have already given the practice. Single-specialty surgery centers that are located in a doctor's office are exempt from the state's CON laws.

"We are delighted by the board's action," said Kathy Browning, executive director of the Georgia Society of General Surgeons, which pushed for the change.

Browning said the announcement was "great news for general surgeons and patients." But hospitals threatened a lawsuit to try to overturn the new rules.

"We'll do what we need to do to protect the interests of our members," said Julie Windom, vice president of the Georgia Alliance of Community Hospitals.

Hospitals argue that only the legislature, not the board, has the authority to make general surgery a single specialty, basing their view on a 2004 Georgia Supreme Court ruling.

The Department of Community Health rejects that interpretation, as do physicians' groups.

"The board created the rule," Browning said. "The board can change the rule."

Lawmakers, including some sympathetic to attempts to change the CON laws, warned the board not to change the standard on its own.

(Anticipating Thursday’s vote, the House Health and Human Services Committee voted on Tuesday to condemn any such move. Rep. Ed Rynders declaredthat the authority to do so resides only with the state Legislature. "The law is clear: Only the General Assembly can change this rule," Rynders, vice chairman of the committee, was quoted as saying.)

Hospitals say they use the shield provided by CON to make up for the state's skimpy reimbursements for Medicaid patients. Georgia pays around 85 percent of the cost of procedures for Medicaid patients.

That means hospitals have to make up the difference from privately insured patients, the same patients that will likely be the target of physician-owned surgery centers. Unlike hospitals, those centers would not be required to provide care to the uninsured and Medicaid patients.

In the end, hospitals are worried they would be left with the patients who can't pay for the full cost of their care while surgery centers take away the profitable clients.

In a separate vote Thursday, the board took a step toward assuaging those fears, approving a resolution urging the legislature to require physicians' surgery centers also treat Medicaid and uninsured patients.

"The department feels very strongly that there should be a way to address that issue," said Clyde Reese, the state's top health planning official.