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Crist signs bill streamlining new hospital construction; Opponents: Underinsured to suffer

By Staff | May 20, 2008

Gov. Charlie Crist signed a bill Sunday that would make it easier for new hospitals to be built across the state, but could leave the door open to push Florida’s underinsured and uninsured aside to create medical offices that focus only on private payers.

Although opponents point out that for the last 35 years the certificate of need program — the state’s regulatory process for approving new hospitals — has been a reliable process, Crist’s goal is to encourage further growth and halt lengthy litigation.

The CON program requires a health care system to receive state approval before building a new facility — such as a hospital, nursing home or hospice center — and to prove that the services are needed in the prospective community.

Senate Bill 2326, considered a compromise between Crist’s vision of deregulating the market and the Legislature’s modified version, streamlines the entire approval process to build a new medical facility.

“By making the certificate of need process more efficient and effective, we are improving access to health care across Florida,” said Crist.

While the governor’s office says that this would encourage the creation of facilities and access to care by stimulating competition, health associations around the state oppose the bill because they say it will “destabilize hospitals.”

The Florida Hospital Association claims the reform will result in an “explosion” of small, limited service hospitals that cater to patients who have insurance and are capable of affording higher-end health care, and provide no care to patients on Medicaid or the uninsured.

As a result, emergency services for the poor and uninsured would be pushed onto full-service hospitals, which are already experiencing cuts in Medicare and Medicaid.

The Lee Memorial Health System, for instance, is standing to lose $24 million if it cannot further delay new Medicaid rules that would narrow the definition of a government provider. Furthermore, President George Bush is proposing to cut more than $5 billion in Medicare funding over the next five years.

Last year the Florida Legislature cut $132 million in Medicaid reimbursements.

“Florida’s hospitals cannot afford legislative action that will further destabilize our health care landscape,” said Timothy Goldfarb, board chair of the Florida Hospital Association, in a news conference earlier this year.

Crist’s other intention with the reform is to curb the lengthy litigation process — brought on by a party that opposes the building of a new facility.

“This bill enables the areas of our state that are really in need of hospitals to secure a health care home for their communities, and it takes the high cost of litigation out of the process,” said Sen. Durell Peaden, R-Crestview, the bill’s sponsor.

The reform forces challengers to give the state a detailed statement of opposition to the project, and if they appeal the state’s final order they must post a $1 million bond and cover the legal costs of the other party if they lose.

“This once burdensome process for general hospitals will see less time and costs spent on litigation and will result in more immediate access to needed health care services in Florida’s communities,” said Crist.

The FHA and other health organizations said it is more important for the state to focus on increasing the number of health professionals in the state rather than buildings. Currently there is a shortage of health workers, especially registered nurses, that has been pinned on a reluctance to propose tort reform.

Some officials say that doctors and other medical professionals leaving medical school avoid coming to Southwest Florida out of fear of what they call “frivolous” lawsuits.

Projections by the Florida Agency for Workforce Innovation indicate that the state will need more than 112,000 health workers by the year 2014.

Since 1999, the certificate of need process has authorized 28 acute care hospitals, 21 new hospitals and seven replacement hospitals, according to the Florida Hospital Association. Furthermore, it has added 1,941 beds to full-service hospitals since 2004.