Cost of Care
Legislators Ponder Hospital Regulation Update
Attorneys and advocates packed a committee room yesterday at the legislature to bend the ears of legislators who have been considering an update of North Carolina’s hospital regulations this winter.
Lawmakers decided yesterday to delay action on the hotly contested Certificate of Public Advantage (COPA) issue that’s set Asheville’s Mission Health System against some neighboring hospitals in western counties.
At a meeting of a legislative committee that’s been reviewing state laws regulating hospitals, lawmakers heard from attorneys representing Mission Hospital, Park Ridge and others who argued over the fate of Mission’s COPA.
The COPA was issued by the state in 1995 when Mission Hospital was seeking to merge with St. Joseph’s Hospital. At the time, lawmakers were concerned the merger would give Mission Health Systems so much market share it could become a monopoly. So, the state limited the amount of operating revenue Mission could earn annually, limited the number of doctors Mission could directly employ on it’s staff and created other limitations on how far a hospital authority could expand in it’s immediate area.
Leaders at Mission argue the health care marketplace has changed dramatically since the mid-90’s and now elements of the COPA restrict the health system’s ability to grow. Mission is asking the state for permission to terminate the COPA when hospital leaders think it’s time.
Mission is the only hospital in the state with a COPA.
“We want a mechanism to end it if we find it renders our services unviable,” said Mission CEO Ronald Paulus.
Mission now controls about 90 percent of the hospital market in Buncombe County and has a significant share of the market in other western counties.
Opponents of ending the COPA argue the move would free Mission to gobble up smaller hospitals in the western part of the state, thus losing local control over county-based hospitals.
“What you’re seeing is an acceleration of activity by the only hospital with a COPA with aggressive projects,” said Graham Fields, assistant to the president of Park Ridge Health. In particular, Fields referred to the County Line project in Fletcher, four miles from Park Ridge.
Mission wanted the County Line project to combine doctors’ offices with outpatient treatment facilities.
“There’s no building there yet, it’s just open dirt, but they’re moving quickly to undermine this committee’s authority,” Fields argued.
According to officials from the state’s Division of Health Service Regulation, the County Line project is permitted under hospital regulations to move ahead with creating doctors’ offices and other services such as physical and occupational therapy. Under the regulations, Mission could also put in a limited amount of outpatient services, as long as the cost of equipment totals less than a half million dollars.
But DHSR denied Mission the ability to create services such as an endoscopy center and a satellite emergency department at the site, citing the presence of similar facilities nearby.
“If Mission is doing what they’re supposed to be doing, there’s no harm in taking a pause, right?” asked Wake County representative Marilyn Avila. But the committee’s attorney pointed out the state could face a legal challenge from Mission if they ordered a halt on a facility that has already been contracted and is under construction.
Eventually, lawmakers agreed to allow Mission to move forward with the county line project, and rejected a proposed moratorium on further projects while they study the issue. They recommended sending the issue to the Program Evaluation Division of the General Assembly to study the COPA in more detail.
“The more I’ve learned about the COPA, the less I know,” said Doctor Thomas J. Pulliam, a gastroenterologist from Wilkes County who attended the meeting, who drew a laugh with his comment.
It was a rare moment of levity in an otherwise tense meeting.
Correction: The story previously stated that lawmakers recommended a moratorium on further projects, which is incorrect. Lawmakers considered a moratorium on projects, but eventually decided to allow projects to move forward. The story has been altered to reflect this correction.