Appeals court weighs in on radiology providers’ battle over state certificate-of-need law
North Carolina’s second highest court is slated to weigh in over an ongoing battle between radiology providers stemming from the state’s certificate-of-need law.
A three-judge appeals court panel heard oral arguments Wednesday in a case pitting Virginia-based Chesapeake Diagnostic Imaging Centers against Sentara Advanced Imaging Solutions.
The North Carolina Department of Health and Human Services selected Sentara over Chesapeake in 2022 for a new MRI machine covering Pasquotank, Perquimans, Currituck, and Camden counties. Sentara already operates two existing MRIs in the area, with Chesapeake hoping to provide competition, the Carolina Journal reported Thursday.
Chesapeake Diagnostic Imaging’s attorneys are now arguing the decision was an error made in prejudice. They’re asking the appeals court to reverse it, allowing the radiology group to enter northeastern North Carolina.
“If a new provider seeking to come into an area and needing a certificate of need is disapproved, and that disapproval is based on agency error, and that is not substantial prejudice, then in the CON context nothing is. Who could bring a case?” asked Noah Huffstetler, one of Chesapeake’s lawyers, according to the news outlet.
“It essentially eviscerates the law,” he added later.
CON laws are state regulatory mechanisms for approving major capital expenditures for certain healthcare facilities, according to the National Conference of State Legislatures. Such regulations are meant to control costs and avoid unnecessary or duplicative expansion in a defined geography. However, critics have accused providers of wielding CON laws inappropriately to limit competition. About 35 states and Washington operate certificate-of-need programs, according to the NCSL.
Read more about the CON battle from the Carolina Journal here:
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.