Florida Paves Way for Hospice Expansion, Doubles 2021 Certificates of Need

Florida’s state government have green lit the expansion of hospice programs in seven counties. The Florida Agency for Health Care Administration (AHCA) indicated earlier this year that it would approve four hospice certificates of need in 2021, but ultimately decided to issue twice as many.

Hospice utilization runs high in Florida, reaching a rate of 57.9% of Medicare decedents during 2018, the fourth highest rate in the country, according to the National Hospice & Palliative Care Organization. Only Utah (60.5%), Delaware (59.4%) and Arizona (58.8%) saw higher utilization.

“The basic assumption underlying [certificate of need (CON)] regulation is that excess health care facility capacity results in health care price inflation,” according to the National Council of State Legislatures. “While the effectiveness of CON programs continues to be a heavily debated topic, many states consider CON programs as one way to control health care costs and increase access to care.”


Opponents of certificate of need laws argue that these regulations drive up pricing by reducing competition and that they allow for political manipulation of the approval process.

Florida awarded certificates of need to Alleo Health, Hernando-Pasco Hospice Inc., Amedisys (NASDAQ: AMED), Catholic Hospice Inc., Continuum Care of Miami Dade, Affinity Care of Manatee County, and VITAS Healthcare, a subsidiary of Chemed Corp. (NYSE: CHEM). A number of hospices applied in more than one county and were approved in some but not others.

The decisions are not final at this point. According to state law, hospice providers whose applications were rejected have 21 days to appeal the decision. They also have the option to challenge certificates of need awarded to their competitors.


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 Since that mandate was lifted, a number of states repealed their certificate of need requirements.

As of 2019, 35 states, Puerto Rico, and the District of Columbia still have such laws in effect, according to NCSL. Though in three of these states, the laws only apply to long term care organizations.

In addition to hospice, Florida requires the certificates for skilled nursing facilities, intermediate care facilities for the developmentally disabled and for certain types of hospitals. The state determines the number of certificates it will issue based on population data, mortality rates, hospice utilization data and the number of providers operating within a county.

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