Gov. Jim Justice has signed legislation that could impact the future of hospice care in West Virginia. State Senate Bill 537 establishes a workgroup to review certificate of need regulations that could prevent new hospice providers from opening in the state.
A major consideration is the question of thresholds for permitting additional hospice providers in each county. Hospice providers in the state, more than 50 percent of which are nonprofits, have voiced concerns that an influx of new organizations seeking to capitalize on the growing demand for hospice care could draw away their patients and resources, endangering their ability to thrive in the state.
“This bill is very important to protect the quality of hospice services we’re providing throughout the state,” Chris Zinn, director of the Hospice Council of West Virginia, which represents all 20 hospices in the state, said. “We are grateful that it received bipartisan, unanimous support from legislators.”
Senate Bill 537 freezes hospice certificate of need standards as they were on Jan. 1, 2018, until the group finalizes its report on potential changes. Their report would be due in late September. The state’s Health Care Authority would then have until December to consider potential modifications to the standards.
Certificate of need rules typically are intended to discourage unnecessary duplication of services in a geographic area, predicated on the concept that excess capacity results in price inflation. Until 1987, federal law required states to have such laws on their books in order to receive federal health care funds. Since that mandate was lifted, a number of states repealed their certificate of need requirements. Currently 35 states, Puerto Rico, and the District of Columbia still have such laws in effect, according to the National Council of State Legislatures. Though in three of these states, the laws only apply to long term care organizations.
The West Virginia bill has received widespread bipartisan support, but legislators in other states have opposed certificate of need laws in favor of a non-regulatory, free-market approach. The Florida state legislature is currently considering a bill to repeal their certificate of need rules on these grounds.
In West Virginia, all health care providers, unless otherwise exempt, must obtain a certificate of need before adding or expanding health care services, exceeding a capital expenditure threshold of $5.2 million, obtaining equipment valued at $5.2 million or more, or developing or acquiring new facilities.
Determination of need is based on the number of decedents who expired while receiving hospice care relative to the total number of deaths in the state. When the state last year proposed raising the threshold for allowing new hospice services to 49 percent, many existing providers expressed concern.
“Many believed that 49 percent was too high, and that the data used were outdated. This is especially high for rural counties and in counties with higher rates of overdose and accidental deaths,” Zinn told Hospice News. “More hospices could result in dilution of the ability to serve more remote areas and more competition for high quality professional staff.”