S.C. Governor Strikes CONs From Budget

Nikki Haley, South Carolina's Republican governor, vetoed funding for the state's certificate of need program out of a proposed budget last week in the name of healthcare competition.

"Bureaucracy should not be telling us which community has or does not have sufficient need for a hospital or a particular piece of complex medical equipment," Gov. Haley noted in rejecting the budget line item.

The state's Department of Health and Environmental Control is currently in charge of determining the necessity for healthcare construction and service additions. The program was slated to cost the state $727,189 in the next fiscal year, mostly for staffing expenditures. But without funding, says healthcare economist Lynn Bailey, "DHEC is stuck with having to administer a program it has no budget to do so."

More than 35 states presently regulate healthcare construction through CONs.

Gov. Haley's veto could be overturned if both houses of the state's legislature return a two-thirds majority vote to override it. That reportedly occurred during last year's budget planning, and the South Carolina Hospital Association is vowing to overturn the veto again.

CONs are at the center of a legal clash between 2 of the state's healthcare systems. Hilton Head Hospital has proposed to build a facility in Bluffton, a move which St. Joseph's/Candler Health System — which operates a facility in Bluffton — opposes. After the department of health and environmental control denied Hilton Head Hospital a CON, the hospital appealed the decision in state court, where it awaits a hearing.

David Bernard