Answer : Certificate of Need (CON) laws are laws which are aimed at reducing the

Question

Answer: Certificate of Need (CON) laws are laws which are aimed at reducing the costs of the health care facilities and facilitates the coordinated planning of new services and the construction of the facilities. The CON is a legal document which is required in many states and the federal jurisdiction in the U.S when there is a proposal for the expansion, creation or acquisition of a health care facility. These laws have negative impact on the hospital efficiency because by restricting new constructions, they may reduce competition which negatively impact on efficiency inside the industry. They bring political influence in the economics of the industry and these laws are not always able to consider the interest of the community.   

Explanation / Answer

Describe what Certificate of Need (CON) laws are. Describe why CON laws could result in either positive or negative impacts on hospital efficiency.

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