Opinion: As virus threatens public health, Michigan limits hospital beds

Diana Prichard

The reality of an emerging pandemic is taking center stage as public health systems around the world become overwhelmed with the sheer volume of coronavirus cases that require hospitalization.

In Italy, efforts to spare the public health system led to movement restrictions on the entire country, as officials scramble to add 50% more intensive care unit beds to hospitals in the hardest hit region of Lombardy.

The U.K.’s National Health System is relying on the generosity of private practices to deal with cases there.

And, though not yet suffering an outbreak, Australia has proactively activated a pandemic plan. “Part of the pandemic plan is ‘hospitals opening their surge capacity,’” Dr. Simon Judkins, past president of the Australasian College for Emergency Medicine, told the Guardian. “Now, I don’t want to alarm anyone, but there is no surge capacity. … We are full every day. We’ve been saying this for years.

Hospitals operating at capacity is not unusual. But the effects extend well beyond public health systems in far-off lands.

"Michigan has one of the most extensive CON regimes in the country, with 18 categories of restrictions," Prichard writes. "One of those determines the number of hospital beds allowed in the state — and the number is not generous."

While some may think the U.S. private health system will insulate American patients from the woes of a government-managed bed shortage, that perception is just as misleading as Australia’s intention to open up non-existent surge capacity.

Since 1972, Michigan has enforced certificate-of-need laws that require hospitals, clinics, nursing homes, dental offices and other medical facilities to obtain government permission slips on a dizzying list of services, equipment and other capital expenditures.

Today, Michigan has one of the most extensive CON regimes in the country, with 18 categories of restrictions. One of those determines the number of hospital beds allowed in the state — and the number is not generous.   

Even without coronavirus cases, physicians in the University of Michigan health system have said they’ve recently received multiple notifications of their hospital being full, and that running at capacity isn’t unusual. Yet according to the Certificate of Need Commission’s self-imposed standards, Michigan has more than 6,400 excess beds.

How can that be? 

Supporters of certificate-of-need laws claim lengthy and bureaucratic approval processes that shut out competition are needed to keep costs low and quality high. Neither facts nor common sense support this claim.

Research from the Mercatus Center shows that states with CON laws have higher medical costs with little to no positive effect on quality ratings. That’s because these laws put up barriers to patient access and put providers in our most at-risk communities at the mercy of larger, more powerful interests. 

That’s why both the Federal Trade Commission and the Department of Justice Anti-Trust Division have urged states to abandon CON restrictions.

Michigan has taken small but important steps toward increasing access, affordability and agility in our health system.

Late last year, the legislature exercised its review authority over new CON restrictions for the first time, blocking a decisionthat would have severely restricted access to a hope-giving cancer therapy known as CAR-T (short for chimeric antigen receptor T-cell) therapy.

Last month, the Senate approved a package of bills (SB 669-673) that would roll back CON requirements on certain construction projects, psychiatric beds, and air ambulances.

And after receiving more opposition than support for a newly proposed rule that would have significantly reduced the number of available nursing home beds in the state, the Certificate of Need Commission is set to hear a slightly less restrictive, but still wholly objectionable, proposal at its next meeting on March 19.

All of this has been a good start, but it shouldn’t take significant political pressure — or the threat of a pandemic — for the state to do away with an outdated, top-down approach that has made health care less affordable and less accessible. 

Now, nearly five decades of its compounding effects are set to complicate things for our state’s doctors and nurses as they try to respond to a potentially global pandemic.  

It’s time to adopt bottom-up solutions that promote innovation and competition. It’s time to let providers meet the needs of their patients — at times of greatest need, and any other time they need health care. 

Diana Prichard is community engagement director at Americans for Prosperity-Michigan.