The Tennessean: Repealing these laws can improve healthcare access in TN
Congress’s new Rural Healthcare Transformation (RHT) Program promises $50 billion to areas in danger of losing local hospitals. But the money isn’t guaranteed, as states must apply for a grant. Each application is scored not only by need but also on whether the state enforces anticompetitive laws in healthcare. Chief among these bad policies are certificate-of-need (CON) laws.
Despite decades of evidence that CON laws suppress supply and raise costs, they remain relatively widespread throughout the country. These laws were first proposed in the 1970s as a means to control healthcare spending, but now primarily serve as protectionist barriers. They block the construction of new hospitals, restrict expansions, and require state permission for basic investments, such as adding beds or purchasing new imaging equipment.
A recent Pacific Legal Foundation report found that states with CON laws have fewer hospitals, fewer psychiatric facilities, and fewer imaging devices. Patients in states with CON laws were 27% more likely to experience bed shortages during COVID-19 surges. The report also found that rural communities are bearing the brunt of the consequences, having 30% fewer rural hospitals, 13% fewer rural surgical centers, and higher per-service spending with worse outcomes as compared to states that have already repealed their CON laws.
Tennessee fits this pattern. One-third of Tennesseans live in rural communities, and the state faces some of the worst maternal and infant health metrics in the country. The 2024 Maternal Mortality Report found that 76% of pregnancy-related deaths were preventable, a staggering indictment of the system. Yet Tennessee still enforces some of the broadest CON requirements in the region, covering new hospitals, expansions, imaging equipment, ambulatory surgery centers, and more. Over the last 20 years, the Beacon Center of Tennessee estimates that approximately one in five healthcare innovations that require CON approval were rejected.
In 2024, the Beacon Center interviewed Kim Marden, CEO of the East Tennessee-based Watauga Orthopedics, who experienced the exploitative nature of CON laws firsthand when her physician board tried to open a new ambulatory surgery center to meet the growing needs of their community. Watauga started the process of acquiring a CON in January 2020. The application fee alone was $95,000. Watauga was then forced to hire attorneys and experts to assist them through the remainder of the process and demonstrate their community’s “need.” Ten months later, the state approved Watauga’s CON application, but Marden estimates that navigating the CON process cost $300,000.
Ultimately, the CON process delayed Watauga’s opening for a total of three years, showing that even when the process “goes right,” patients and communities suffer from delayed access to new services.
Another example documented by the Beacon Center resulted in the Whitehaven community of Memphis being denied access to care altogether. Dr. Dwight Dishmon, an interventional cardiologist who wanted to open an ambulatory surgery center in his community so that he could offer them better care, estimates that he spent $75,000 in attorney’s fees alone trying to navigate the CON application process. Even though there was no ambulatory surgery center in his community, the state denied his application. As a result, Dr. Dishmon could not open his center even though it could have provided life-saving care to many Tennesseans in his area.
But there is finally a chance to correct this problem. In Tennessee’s application for federal RHT funds, the state pledged to introduce and pass legislation in the 2026 session eliminating CON for new healthcare facilities, with implementation by January 1, 2027. Eliminating CON would remove artificial barriers to entry, increase supply, and give rural communities a fighting chance to rebuild healthcare access.
Tennessee’s lawmakers should fulfill this promise. The evidence is clear: CON laws raise costs, reduce access, and disproportionately affect rural residents. Repealing CON laws by 2027 is not just good policy; it’s an obligation to the communities that this system has failed for so long.
This op-ed was originally published in The Tennessean on January 16, 2026.
