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Consumer
Group Releases Report Analyzing Maine's
Certificate
of Need Program
Recommends CON Program Be
Strengthened
Consumers for Affordable Health Care Foundation,
a non-profit consumer health organization, released
a report today that concludes Maine's Certificate
of Need (CON) program is not operating effectively
and calls for improvements. The report, entitled When,
Where and How Much: Improving Maine's Certificate
of Need Program, relies on Maine Department of
Human Services records for the seven-year period from
1997 to 2003. It tracks all approvals and disapprovals
of construction projects by hospitals and health care
facilities, purchases of major medical equipment and
the delivery of new health services. The report comes
on the heels of the end of the one-year moratorium
on CON projects from May 5, 2003 to May 4, 2004 imposed
by Governor John E. Baldacci to allow Maine adequate
time to develop new CON guidelines that follow a state
health plan.
The report found that between 1997 and 2003, 68 CON
applications were approved while only four were denied.
The approvals totaled more than $341 million out of
a total of $347.2 million in submitted capital expenditures
and almost $74 million out of a total of $75.5 million
in submitted projected third-year operating costs.
"It's not surprising that Maine's CON program
is not as effective as it could be," said Joe
Ditré, executive director of Consumers for
Affordable Health Care Foundation. "The CON Program's
budget is a miniscule fraction of the annual amount
of projects it reviews. The overall program lacks
sufficient resources, guidance and structure."
The report found that the CON Unit at the Bureau
of Medical Services, one of two small units within
Maine DHS that is responsible for carrying out an
overwhelming majority of CON activities, employs only
2.3 full-time equivalent employees. Their work included
the approval of over $341 million in capital expenses
for 68 CON projects - an average of 9.7 approved projects
per year that account for an annual average of $48.7
million in projected capital costs. "If the Governor's
Office of Health Policy and Finance wants to effectively
use CON to control costs and improve care in Maine,
it must ensure that the CON program has more people.
There simply are not enough staff people to do this
important work," said Ditré, the consumer
group's director.
The report found, "Because there is neither
a state health plan nor a health planning office,
the CON program is not part of a health planning process
on a statewide basis. Instead, it stands alone - a
process that is not tied to anything. There is currently
no criteria or process to determine if more infrastructure
or technology is needed."
As health care costs continue to grow at unsustainable
rates across the country, and in Maine, there has
been a renewed interest in cost containment strategies,
such as CON, as solutions for this problem. The report
also found, "As of February 2004, 36 states and
the District of Columbia have active CON laws. The
remaining 14 states repealed their CON regulations
shortly after the federal government pulled its financial
support of the program in 1987." Maine, like
many states, has begun trying to strengthen the effectiveness
of its CON program. The Dirigo Health reform legislation
includes many measures aimed at strengthening the
program. The draft of Maine's one-year State Health
Plan also places a great deal or emphasis on the CON
program as a key component of the cost containment
strategies.
In its report, the consumer group made the following
recommendations for how the program could operate
more effectively and efficiently:
- The state should consider decreasing the dollar
amounts that trigger CON review.
- Staffing of the CON Unit should be increased.
- The CON Unit needs to employ or contract for economic
and financial expertise.
- The CON Unit should be organizationally relocated
within the Department of Human Services.
- The CON review and decision process should be
de-politicized.
- The CON program should be guided by specific criteria
that tie program decisions to the goals outlined
in the State Health Plan.
- The CON program should be monitored on an ongoing
basis to track the effect of approved projects on
costs and quality, with mechanisms available to
correct problems, as needed.
The report also points out that while a CON program
can be effective at controlling costs, it should not
be considered a "silver bullet." Instead,
it should be one strategy, among many, that a state
uses to control rising health care costs. According
to the consumer group's director, Joe Ditré,
"The true strength of a CON program is not in
its individual project decisions, but in the role
it plays within a state health planning process in
allowing for the planned allocation of resources and
services." In this regard, CON has an impact
on more than just costs. The program can also lead
to improvements in the quality of care delivered and
to ensuring equal access to health care. Ditré
explains, "Recently there has been national and
local press coverage about the eagerness of hospitals
to build. Consultants predict that this spending and
building will focus on the services and technology
that provide the owners with the greatest return on
investment. But more may not be better. The best financial
decision for hospitals or specialty practices may
not correlate with the greatest health needs in Maine's
communities. A properly guided and funded CON program
can ensure that resources are allocated to meet community
health needs, even if those services are not the ones
that have the highest profit margins."
The full report is entitled When,
Where and How Much: Improving Maine's Certificate
of Need Program. This is the second in a series
of four reports on health care costs, cost controls
and coverage. See Publications
for more the first report of the series.
See
below to view the full report.
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