Local & State Headlines

CON law in process of change

• Legislation could make a hospital's December lawsuit against the state and an Albany surgery center moot.

Susan McCord

ALBANY — Certificate of Need requirements that critics say for years have limited health care options in metro Albany have been lifted in a bill that passed Friday on the final day of the Legislature’s 40-day session.

The bill, which needs Gov. Sonny Perdue’s signature to become law, removes Certificate of Need regulations for ambulatory surgery centers, obstetrical care and cardiac catheterization services. Phoebe Putney Memorial Hospital has been the exclusive provider of obstetrics and heart catherization in Albany.

In a vote which divided local legislators, the House passed an amended version of Senate Bill 433 on Friday 138-17, with 17 representatives, including Rep. Winfred Dukes, D-Albany, not voting.

“I felt good about increasing the level of competition,” said Rep. Ed Rynders, R-Lee County, who voted for the bill.

“I thought it was positive,” he said, “that the message was sent that not all the best-paying customers get to go to one place.”

Those higher-paying customers are the ones that Phoebe and other private not-for-profit hospitals have argued that free-standing surgical centers and other health providers will siphon away, leaving the not-for-profits with a larger of share patients with less ability to pay for services.

“The most important thing to me is that Palmyra Medical Centers can now compete, and we can have two full-service hospitals in Albany. That will lead to lower health care costs and an improvement in quality,” said Dr. John Bagnato, who co-authored the Phoebe Factoids, a series of anonymous faxes which in 2004 helped prompt a class-action suit against Phoebe and other hospitals over the costs of medical care. It was later dismissed.

Bagnato then worked for Albany Surgical PC, which lost a CON challenge from Phoebe to open a free-standing surgery center, though Bagnato has since left the group.

The bill also disrupts a 2007 suit by Phoebe over the Department of Community Health’s December rule change making general surgery a specialty, thereby allowing general surgeons to open private clinics.

The suit, made by Phoebe and the dozens of members of the Georgia Alliance of Community Hospitals, named Albany Surgical as a defendant in a suit against DCH, and argued that only the Legislature, not DCH, could alter the health planning rules.

“Now the Legislature took up that issue and declared that we were a specialty,” said Albany Surgical’s Dr. Chris Smith. “Now that the Legislature has done it, it’s a moot suit.”

The bill’s passage Friday “is a culmination of a lot of hard work by a lot of people during the session,” he said.

They included Albany physicians and surgeons and lobbyists on both sides of the issue, as well as Phoebe administrators, such as CEO Joel Wernick.

“It should have been done year and years and years ago,” Smith said, “ but the only reason it wasn’t is because of the lobbying efforts of the not-for-profit hospitals, but the Legislature saw through that, that they were just trying to maintain a monopoly.”

Albany internist Dr. Joe Stubbs said he “has no dog in this fight” other than through his work with the Coalition for Affordable and Competitive Healthcare, an organization of local industries, including Procter & Gamble and SABMiller, whose mission is to lower health care costs.

“The bottom line on it is the on issue of CON, it rolls back CON,” Stubbs said.

But the reform bill is unlikely to stop debate over affordable health care in Albany, he said.

“Oh no,” he said. “There’s always going to be room for improvement,” with “one side, Phoebe, saying Southwest Georgia is doing well with Phoebe being a monopoly,” while “another side, the industry side, saying we need more competition, we need to do more to lower health care costs.

“The one controversy that it has put to rest is the controversy of whether general surgery is a single specialty.”

While it wasn’t involved in the debate at the Capitol, Palmyra Medical Centers is now studying the bill to determine just what services it may decide to offer, Director of Marketing Eric Riggle said.

“We’ll have to see what it means to the service lines that we historically have been interested in,” Riggle said.

The hospital’s applications for a Certificate of Need to provide obstetrical and cardiac catheterization care have repeatedly been turned down by the Department of Community Health following challenges from Phoebe.

“The first thing we’ll do is evaluate the legislation and determine at what point we’ll have an opportunity to offer these services.”

Wernick said that while the bill streamlines some processes, it sets bad policy.

“We’ll spend time looking at it carefully, to see what its various provisions are; we do think that it has the potential to streamline some pieces of the Certificate of Need law that we agreed with, and it obviously creates a flexibility in the Certificate of Need process that didn’t exist before,” he said.

That flexibility to offer services — general surgery, Level 1 obstetrical care and cardiac catheterization — under the CON reform law no longer require a “need analysis,” he said.

He agreed that the Legislature’s action likely mullified Phoebe and GACH’s recent suit against DCH.

“What I do think will end up happening” is the suit “will probably end up being superseded by the new law,” Wernick said.

The hospital’s provision of Level 3 perinatal care, for premature infants, may be compromised by the bill, he said.

“Our concern is the redirection of scarce resources that may dilute the effectiveness of the perinatal system,” Wernick said.

Dukes said he wasn’t absent from the legislative session Friday, but was distracted by another issue when the vote was taken just after dinner.

“I probably would not have voted for it, one way or another,” he said.

The divided votes from south Georgia legislators, which included “no” votes from several Valdosta-area representatives and Rep. Freddie Powell Sims, D-Albany, surprised him, though he doubts the reform will reduce the level of care in Albany.

“I’m sure Joel and them at Phoebe will take it in stride and continue to be sure we continue to have a world-class hospital,” Dukes said.

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