Hospitals could face new restrictions on where they can build.
Indiana hospitals once had to get a “certificate of need” to show they were building in an underserved area. That law was repealed 19 years ago, and Indianapolis Senator John Ruckelshaus (R) argues it’s one factor in driving up health costs. Because hospitals are clustering in high-income areas, there’s a higher concentration of people with private insurance instead of Medicaid. He says studies in other states have concluded instead of competition holding costs down, the clusters are pushing them the other direction.
Ruckelshaus got involved at the request of some constituents near the Hamilton County line who are trying to block a proposed Saint Vincent trauma center as too disruptive to the neighborhood. They argue Saint V’s main campus is one of four hospitals within a five-mile radius.
And Ruckelshaus argues many rural areas have the opposite problem, with hospitals scattered too widely across the area.
The Indiana Hospital Association says the cost savings haven’t materialized in other states which have added the requirement, and warns the bill would have unintended consequences.
Legislators have already reinstated a certificate-of-need requirement for new nursing homes, in response to an oversupply of vacant beds.
The proposal wouldn’t apply to expansions of existing hospitals.
