Washington Judge Invalidates Certificate Of Need Law

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A Thurston County Superior Court Judge has invalidated changes the Washington Department of Health made to the state's certificate of need law, according to the Washington State Hospital Association.

Historically, the state Department of Health has reviewed the sale, purchase or lease of a hospital before awarding a certificate of need; the state has previously said it doesn't have the authority to review other management changes such as affiliations and mergers.

However, last year, Washington Gov. Jay Inslee (D) directed the Department of Health to update the certificate of need process for hospital mergers and affiliations. On Jan. 23, the department altered the rules so that it will now review any "change of control" in "any part" of a hospital.

The WSHA filed a lawsuit claiming the new regulations do not have a basis in certificate of need law. The WSHA claimed the rule change meant even small business decisions such as outsourcing billing services would have to go through an extensive review process, and with each application requiring a $40,000 filing fee, the WSHA claimed the regulations were unmanageable.

The WSHA also claimed the Department of Health went beyond its authority in changing the certificate of need law.

The superior court judge agreed with the WSHA and ruled the changes the department made to the certificate of need law exceed its statutory authority.

"We are relived to see the judge's ruling, and are glad that hospitals can efficiently form the partnerships necessary to preserve and expand healthcare services in their communities," said Scott Bond, president and CEO of WSHA, in a news release.

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