Dealing with Specialty Regulatory Requirements when Developing A New Health Care Facility


Certificate of Need (CON) REVIEW: What is it, what are the requirements, and how can The Innovations Group, LLC help? For starters, let’s talk about CON and how it can affect your new healthcare facility approval and building development.

What is a CON?

A Certificate of Need is an endorsement that numerous states, including Tennessee, require before the approval of the construction of certain new healthcare facilities such as surgery or imaging centers . The central idea of CON legislation is based on the assertion that overbuilding and redundancy of healthcare facilities will lead to higher healthcare costs. The Certificate of Need law is implemented to contain costs, improve healthcare access, monitor quality, and ensure that federal requirements are met. The CON Program ensures that such projects are accomplished in an orderly and economical manner that is consistent with the development of adequate and effective healthcare for the people of Tennessee. In Tennessee, the Tennessee Health Services and Development Agency is responsible for regulating the healthcare industry throughout the state via the Certificate of Need Program. 

What are the Requirements?

Approval is given after review is made, and the criteria used for such review will be:

  • Need. The healthcare needed in the prospective area to be served may be evaluated upon such factors as:
    • The relationship of the proposal to any existing applicable plans
    • The population served by the proposal
    • The existing or certified services or institutions in the area
    • The reasonableness of the service area
    • The special needs of the service area population, including the accessibility to the consumers, particularly women, low-income groups, and racial and ethnic minorities
    • Comparison of utilization/occupancy trends and services offered by other area providers
    • The extent to which Medicare, Medicaid (TennCare), and medically indigent patients will be served by the project. 
  • Economic Feasibility. The probability that the proposal can be economically accomplished and maintained will be evaluated based on the following factors:
    • Whether adequate funds are available to the applicant to complete the project
    • The reasonableness of the proposed project costs
    • Anticipated revenue from the proposed project and the impact on existing patient charges
    • Participation in state and federal revenue programs
    • Alternatives considered
    • The availability of less costly or more effective alternative methods of providing the benefits intended by the proposal.
  • Contribution to the Orderly Development. The contribution which the proposed project will make to the orderly development of an adequate and effective healthcare system may be evaluated upon the following factors:
    • The relationship of the proposal to the existing healthcare system, such as transfer agreements, contractual agreements for health services, or affiliation of the project with health professional schools
    • The effect, either positive or negative, attributed to duplication or competition
    • The availability and accessibility of human resources required by the proposal, including consumers and related providers
    • The quality of the proposed project in relation to applicable governmental or professional standards

How we can help. The Certificate of Need approval process is a complicated one, and is both costly and lengthy, as well; the entire process from beginning to end can last from 6 to 12 months, and at times even longer. Engaging a team for assistance will be vital, and The Innovations Group team has the experience to get you through the process to its completion. We work with specialty accountants, engineers, architects, and contractors to ensure that you have everything you need to present for evaluation. We can help to produce the required analytics, as well as to both design the space and then show how that space will function and operate. We will create all the budgeting that is necessary to create the space, as well.

The Innovations Group, LLC is the team that will help you go through the Certificate of Need approval process from the very start to the end result.