Despite 14 states having repealed their Certificate of Need (CON) programs, and others having significantly reduced their programs in recent years, several states are now examining ways to reintroduce CON as a purported method of leveling the playing field between general acute care hospitals and competing independent outpatient facilities such as ambulatory surgery centers (ASCs).

At the same time, the CON application process itself has garnered heightened public and legislative scrutiny, perhaps as a result of recent media attention related to scandals, indictments, and litigation involving the CON regulatory policy. Beginning in the mid-1970s, the federal government imposed CON laws for inpatient care for 49 states, in an attempt to restrain “skyrocketing” healthcare costs; prevent unnecessary “duplication” of healthcare resources; and, achieve equal access to quality healthcare. In CON theory, appropriate management of healthcare supply should reduce the overall cost of care. It is within this context that we will discuss overall strategies for surviving the “CONtact sport” of planning and implementing a successful CON application for an ASC.

Establishing an Effective Project Team

When embarking on a CON application, it is crucial to establish at the outset a collaborative project team comprised of members from the ASC applicant’s staff (e.g., executive management, medical director, business administrator, controller/financial operations executive), and general/ in-house counsel and professional advisors (e.g., outside legal counsel familiar with the local CON application process), as well as a healthcare consultant experienced with CON application research, forecasting and regulation. Lobbyist and public relations support may need to be retained depending on what opposition the applicant is expecting to face from competitors and local community hospitals.

Establishing a CON Application Project Process

The project team should develop an agreed upon schedule for the preparation of the application based on deadlines as indicated on the State’s application review calendar. A detailed project plan and document request checklist should be established based on each element of the application that will need to be completed — a description of each task, the person assigned each task, and the estimated time frame to complete each task. It is imperative to follow that state’s directions for assembling the application — proper heading and section identification schema, whether electronic signatures will be accepted as “original” and if it is to be followed “to the letter” as well as determining the proper method of application delivery (e.g., certified mail, overnight delivery). Upon delivery of the application, the applicant should follow up with the state review committee to confirm the submitted application is complete and whether there are any expected “bumps in the road.”

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Assessing and Navigating the CON Political Battlefield

Submitting a complete application is only the first step. In many states, the proper assessment and successful navigation of the CON political battlefield requires achieving support from the following groups: the state agency reviewing the application; media; state legislature; local physicians and hospitals; civic/local business/developer support; and patient/local community (see pyramid chart below).

Applicants should also seek clarification and support from state CON agency staff and application decision makers. Talking points should be developed to allow a consistent and timely response to press requests and interviews, and press releases should be produced and disseminated outlining the public benefits that will result from the proposed projects. Legislative support should be secured by identifying industry relationships, past legislative voting records and the political background of those members who either participate in, or influence the state review committee. Securing informed and knowledgeable lobbyist contacts may facilitate that aspect of the process.

Local community support should not be overlooked, including building a network of physician support by identifying key members of the local medical community as well as the various medical societies and associations, and encourage them to place phone calls to other physicians. Additionally, the project team should identify support from local developers, vendors and businesses. 

TOP 1O TIPS FOR COMPLETING THE APPLICATION

1. Determine what type of review the proposed application falls within, (e.g. full review, expedited review, non-substantive/nonapplicability review).

2. Be responsive to application questions, but do not provide more information than is requested. Complete each portion of the application anticipating that you will have to defend it under cross-examination.

3. Draft succinct — yet strong — arguments in support of your “need argument.” Highlight key issues the review committee will be looking for (e.g., emphasize the availability of increased technology as it relates to patient quality of care benefits; the promotion of patient choice; and increased patient access to care.

4. Cite appropriate regulations; attach supporting client data (i.e., proforma); peer reviewed articles regarding patient incidence/prevalence; and utilization demand standards.

5. Be consistent and use parallel construction throughout the application (e.g., “surgery suites” vs. “surgery beds”).

6. Determine current and projected population and demographic characteristics of the geographic service area.

7. Identify state boundaries, patient access avenues for ingress and egress for patient access (e.g., highways, bridges, public transportation), as well as the geography of the service area (e.g., natural boundaries such as rivers and mountains).

8. Determine patterns of in and out migration for specific services offered by the ASC and patient preferences or origin.

9. Determine the extent to which Medicare, Medicaid and medically indigent patients will be served by the proposed project.

10. Maintain thorough, well organized documentation of all information relied on.

At the end of the day, it may be helpful for those ASC providers developing and implementing a successful CON application to remember to: 

a. carefully follow state directions for preparing and submitting the application while building an effective team of client, staff and professional advisors. Each of these considerations are fundamental to achieving a successful application process. 

b. build a strong base of local community support for the proposed application.

c. do not trust in the kindness of strangers and maintain a healthy skepticism of the CON process and political battlefield.

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