Georgia Senate seeks to allow rural hospitals without permit

Georgia senators want to allow new hospitals to be built in counties with fewer than 50,000 residents without state permission, a measure particularly aimed at allowing an undisclosed entity to build a new hospital in the home county of Lt. Gov. Burt Jones.

Senators voted 42-13 to pass Senate Bill 99 on Monday, sending it to the House for more debate.

The measure says governments or private nonprofit groups can build hospitals in less-populated counties without getting a certificate of need from the state Department of Community Health.

The certificates, in place in Georgia since the 1970s, require someone who wants to build a new health care facility or offer some new services to prove that such an expansion is needed in the community. They’re meant to prevent overspending that would increase healthcare costs.

But incumbent hospitals and health care providers often oppose new developments in their territories, and those who dislike the certificates say they prevent needed competition and unfairly prop up incumbents’ revenues.

"This a bill that allows free markets to operate in the health care spectrum," said Sen. Greg Dolezal, a Republican from Cumming who sponsored the bill.

Supporters of the exemption for hospitals in smaller counties say that it would help encourage health care investment in rural areas that lack it. But much of the debate has focused on Jackson County, on the suburban fringe southeast of Atlanta, where the Republican lieutenant governor is from.

There, the Marietta-based Wellstar Health System operates the county-owned Sylvan Grove Hospital. County commissioners say the 25-bed hospital doesn’t provide enough services to meet the county’s needs.

Wellstar, however, has said a new 100-bed hospital would hurt both Sylvan Grove and the larger 160-bed Wellstar Spalding Regional Hospital in nearby Griffin.

"If a hospital is locates too close to another hospital, there’s a hardship on the other hospital because patients are poached," said Sen. Nan Orrock, an Atlanta Democrat. "You’ve expended a lot of money and resources, but they’re fighting over serving the same patient base."

Senators are also considering the broader Senate Bill 162 that would replace certificates with a less restrictive special health-care service license. That bill would apply to all health care services and not just hospitals. The measure would also establish rules for how much health care providers with the special licenses would have to spend on caring for patients who can’t pay.

But Sen. Bill Cowsert, an Athens Republican, said Monday’s bill is "very narrowly focused on a problem we have dealt with in this chamber in the last decade: adequate services for the rural areas of our state."

While some states have repealed certificate-of-need laws, Georgia is among 36 states and the District of Columbia still using them.