Agencies: Alaska laws may limit health care competition

JUNEAU — Two federal agencies have recommended that Alaska repeal laws that the agencies say may limit competition in the health care market.

The U.S. Department of Justice and Federal Trade Commission weighed in on Alaska’s so-called certificate-of-need laws at state Sen. David Wilson’s request.

Wilson, a Wasilla Republican, has proposed repealing Alaska’s certificate-of-need program.

Alaska’s laws require health care providers to get state approval before spending $1.5 million or more to build a new facility or to expand services.

In a joint, 15-page statement released Wednesday, the federal agencies said the intent of such laws, in Alaska and other states, was to reduce health care costs. But, they said, such laws generally do not appear to have achieved desired results.

According to the National Conference of State Legislatures, a 1974 federal law mandated that states have a process under which major building projects would need approval by state health agencies.

The mandate was repealed in 1987, and a number of states later ended their programs, the organization said.

Critics of Wilson’s proposal say the certificate-of-need program may have flaws but say that it has provided market stability.

In written comments, the president of the board of the Greater Fairbanks Community Health Foundation, Jeff Cook, asked that lawmakers move cautiously on the issue.

Repeal of the certificate-of-need laws, he said, would create unfair competition and hurt the financial stability of the Fairbanks Memorial Hospital.

“Federal mandates require hospitals to open their doors to all those in need,” he wrote. “If given the chance, specialty clinics and/or boutique hospitals will avoid all non-profitable services.”

The state health department currently is not recommending changes to the certificate-of-need program and considers itself neutral on Wilson’s bill, department spokeswoman Sarana Schell said by email.

Nearly two months after it was introduced, Wilson’s bill remains in its first committee of referral. If the bill does not pass this session, it will remain in play for next year’s session.

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