Tennessee to revise certificate-of-need law, increasing fees for hospitals, exempting others

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Tennessee lawmakers passed a bill last week that makes several changes to the state's certificate-of-need requirements, exempting more healthcare providers from needing to apply for a certificate but raising fees for providers.

Certificate-of-need laws require hospitals to seek approval from the state to add services or beds. The goal of the law is to limit unnecessary services and increase competition.

Under the bill, hospitals would have annual fees increased from paying up to $300, to paying up to $5,000 for the certificate-of-need program. Ambulatory surgery centers will have to pay $2,000, up from $100. Lawmakers said they expect the fees to help bring in $1.3 million in revenue per year.

In addition, mental health hospitals, hospital-based outpatient treatment centers for opioid addiction would be exempt and not need a certificate-of-need to open. Additionally, existing hospitals could increase their bed count at their main facility without approval. But, they would still need to apply to add new types of beds or adding beds at satellite locations. 

The bill also proposes decreasing the certificate of need application process by 75 days. 

The bill, passed by both chambers, awaits the signature of the Tennessee House speaker and will need to be signed by the governor. 

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