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INQUIRY

To date there have been 45 empirical assessments of CON and spending per service. Sixty percent associate CON with higher spending per service, while just 7% associate CON with lower spending per service. The rest find negligible results. 42 Among other things, researchers find that: •• CON laws are associated with 10% higher variable costs in general acute hospitals 43 ; •• Hospital charges in states without CON are 5.5% lower 5 years after repeal 44 ; •• In Ohio, reimbursements for coronary artery bypass grafts fell 2.8% following repeal of CON and in Pennsylvania, they fell 8.8% following repeal 45 ; •• Acute care costs rise with the rigor of CONprograms from the most resource-intense diagnoses 46 ; •• CON laws are associated with higher Medicaid costs for home health services 46 ; and •• There is some evidence that CON is associated higher Medicaid long-term care costs. 46 It is possible that the architects of CON were not inter ested in reducing spending per service but were instead con cerned with limiting total expenditures. A supply restriction might decrease total spending by rationing care; after all, an extremely restrictive CON that outlawed all health care would cause expenditures to fall to zero. But supply restric tions are most likely to reduce total expenditures if marginal health care services are elastically demanded. 47-49 Most health care services, however, are inelastically demanded. 50 So even this theoretical possibility seems unlikely. The evi dence is consistent with this expectation. Among 52 empiri cal tests, 44% associate CON with higher overall spending, 40% obtain negligible results, and just 15% associate CON with lower overall spending. 42 Among these tests, researchers find: •• Per capita hospital expenditures are 20.6% higher in states with CON laws 51 ; •• Stringent CON programs are associated higher expen ditures per admission 52 ; and •• Nursing home CONs are associated with higher expenditures per resident. 53 What about the goal of increasing access to care? As a supply restriction, one would expect CON to reduce access to regulated health care services. It is possible, however, to imagine scenarios in which CON might increase the avail ability of some specific services. For example, if CON applies to certain services and not to others, or if regulators are more restrictive with some services than others, then we might expect to see the latter become more available. Despite this possibility, the data suggest CON limits access to care. To date, there have been 190 tests assessing the effect of CON on access to care; 52% of them find CON is associated

with diminished access, 38% find negligible results, and just 10% associate it with greater access. 42 Among these tests, research finds that patients in CON states: •• Have access to 30% to 48% fewer hospitals 54,55 ; •• 30% fewer rural hospitals and 13% fewer rural ambu latory surgery centers 54 ; •• 25% fewer open-heart surgery programs 56 ; •• 20% fewer psychiatric care facilities 57 ; and •• Fewer dialysis clinics and reduced capacity at existing clinics. 37 Several studies associate CON with fewer hospital beds. 43,58,59 And others associate the regulation with fewer imaging devices, 59 longer wait times, 60 longer driving dis tances, 61 and more out-of-state care. 62 In determining need, CON regulators do not typically assess a provider’s qualifications. Nor do they evaluate their safety record or outcomes. The advocates of CON neverthe less maintain that the regulation can increase quality by cre ating more high-volume providers. If CON results in fewer providers with each performing more procedures, and if pro viders get more competent at a procedure they more they perform it, then it is possible that the regulation might indi rectly enhance quality. On the other hand, CON might under mine quality by limiting provider competition. 63,64 In total, 114 tests have assessed the effect of CON on quality and just under half—46%—associate the regulation with lower qual ity. Thirty-nine percent of tests find insignificant or neutral results, and just 16% associate the regulation with better quality. 42 Among these tests, researchers find that in states with CON laws there are: •• Higher mortality rates for heart attack, heart failure, and pneumonia 65,66 ; •• Higher mortality rates for natural death, septicemia, diabetes, chronic lower respiratory disease, influenza/ pneumonia, Alzheimer’s, and COVID-19 67 ; and •• Lower nursing staff-to-patient ratios and greater use of physical force in nursing homes. 68 Finally, the architects of CON hoped that regulators might be able to divert health care resources from overserved popu lations to underserved populations. The evidence suggests that CON laws have not achieved this goal. To date, there have been 17 tests assessing whether CON has encouraged the financing or provision of care to rural or otherwise under served populations. Eight-two percent of them find that CON undermines the provision of care to these groups while 18% find no significant effects. No tests associate CON with enhanced provision of care for underserved populations. 42 Among those tests that assess the effect of CON on under served populations: