SB 1539, An Act Concerning Certificates Of Need

TESTIMONY OF THE CONNECTICUT HOSPITAL ASSOCIATION
SUBMITTED TO THE PUBLIC HEALTH COMMITTEE

Monday, March 24, 2025

The Connecticut Hospital Association (CHA) appreciates this opportunity to submit testimony concerning SB 1539, An Act Concerning Certificates Of Need. CHA offers our comments and concerns about the bill as written.

Connecticut hospitals and health systems care for patients, strengthen the state’s economy, and support vulnerable communities across the state. Every day, they work to improve healthcare access, affordability, and health equity. Even as they face ongoing challenges, hospitals provide world-class care to everyone who walks through their doors, regardless of their ability to pay. Hospitals also support an exemplary workforce as the largest collective employer in the state, contribute significantly to the state’s economy, and invest in their communities addressing social drivers of health.

CHA continues to advocate for a certificate of need (CON) process that is timely, equitable, efficient, and not cost-prohibitive for applicants and stakeholders. We appreciate the areas of this bill that are intended to address some of these issues and suggest revisions in some areas.

Section 1 of the bill adds a CON requirement for “any investment in a health care facility by a private equity company in which the private equity company acquires a controlling interest, either directly or indirectly, in a health care facility, or otherwise obtains the ability to exercise operational control, managerial control or decision-making authority over such facility.” We support this change in law. We acknowledge the damage that unregulated private equity investment has caused in certain situations in Connecticut and believe that this new oversight requirement, which focuses on investments that impact the controlling interest or managerial control of a hospital, is targeted and reasonable.

Section 2 of the bill adds a provision requiring the denial of a CON application seeking termination of labor and delivery services by a hospital unless another hospital offering the same services is no more than 25 miles away. We are concerned the language as written ties the Office of Health Strategy’s (OHS) hands by requiring them to immediately deny an application solely on the distance of the same service in another hospital. We believe more factors should be considered, including the ability to recruit staff and the volume of patients as it relates to the operational viability of the service. Without considering these other factors, the language as written prevents OHS from looking at all the circumstances and does not provide the office with flexibility necessary for appropriate responsiveness. We request that this language be struck from the bill.

Section 3 of the bill (1) requires OHS to post notice on its website when it enters into an agreed settlement or negotiations for an agreed settlement, (2) prevents OHS from granting intervenor status in any public hearing related to a CON application filed by a group practice, and (3) creates an expedited process for a CON application to increase licensed bed capacity.

CHA supports the requirement for OHS to post notices on its website when it enters into an agreed settlement or negotiations for an agreed settlement.

CHA opposes OHS prohibiting intervenor status in CON applications filed by a group practice. As drafted, this would allow, for example, a group practice to submit an application to begin cardiac services without allowing any party to intervene to provide OHS with information about the appropriateness of such application.

We support the bill’s creation of an expedited process for increased licensed bed capacity. The development of this process is responsive to recent experience in our state where regular surges in patient volume have strained hospital licensed bed capacity. We request that the language be updated to better reflect the urgency of these scenarios and request that the timeframe for approval be shortened to no later than 48 hours, rather than the 30-day decision timeframe that the bill suggests.

While we appreciate the committee’s attention to the CON process and proposed amendments, we believe the CON process needs a much more significant overhaul and recommend the Committee consider including additional improvements to the CON process, including but not limited to:

    • Prohibiting OHS from requiring applicants to meet requirements or obligations that are not set forth in statute or regulation
    • Authorizing a committee review of the structure of the CON process, including review of the cost to healthcare providers due to delays and inefficiencies in the CON process and an examination of the CON process in other states, including, but not limited to, New York and Massachusetts
    • Streamlining the CON process by not requiring a CON for the relocation of any outpatient service within the same municipality, a reduction or increase in the number of inpatient or outpatient beds by nine or fewer in a two-year cycle, the termination of inpatient or outpatient services due to insufficient patient volume or the inability to recruit or retain an adequate number of providers, or the termination of any subspecialty surgical service
    • Developing an expedited CON process for the establishment, transfer, or expansion of behavioral health and substance use disorder treatment services, for the acquisition of imaging equipment, and for terminations of services
    • Reducing delays by limiting requests for information, using only information in the record and available to all parties in making decisions, requiring timeliness in noticing and holding hearings, and deeming applications approved should OHS not meet statutory timeframes

Thank you for your consideration of our position. For additional information, contact CHA Government Relations at (203) 294-7301.