ChatGPT Talks CON Laws

Interviewing OpenAI’s ChatGPT About Certificate of Need Laws

Technology is growing incredibly fast, so I wanted to see what AI thinks of current health care regulations. I recently sat down with OpenAI’s ChatGPT and was briefly able to discuss Certificate of Need (CON) laws with it. Here is how that discussion went:

Interview: What Are CON Laws?

Me: Hi ChatGPT!

ChatGPT: Hello! How can I assist you today?

Me: I want to talk to you today about Certificate of Need laws in America.  Are you familiar with these laws?

ChatGPT: Yes, I’m familiar with Certificate of Need (CON) laws. They are state-level regulations in the United States that require health care providers to obtain government approval before investing in certain types of medical facilities or equipment. The goal is to control health care costs and prevent overinvestment in facilities and services that might not be needed.

Interview: How Are CON Laws Intended to Work?

Me: Great. When it comes to controlling healthcare costs as a goal of Certificate of Need laws, by what mechanism is supply restriction supposed to decrease prices, seeing as though reduced supply is normally associated with higher prices?

ChatGPT: The idea behind CON laws is that by limiting the number of medical facilities and services, the government can prevent overinvestment and keep costs down. However, in practice, this restriction of supply often leads to increased prices as fewer providers have to bear the cost of investment and maintenance for the same number of patients. Additionally, limited competition can lead to reduced incentives for providers to control costs and improve quality. Thus, market forces and competition, rather than government restrictions, are more likely to drive cost-effectiveness in healthcare delivery.

Interview: What does the research say about CON laws?

Me: Has there been any research showing that repealing CON laws results in greater access to healthcare or reduced healthcare costs for consumers?

ChatGPT: Studies have shown that repeal of Certificate of Need laws is associated with increased access to healthcare and reduced costs for consumers. For example, a study by the Mercatus Center found that states that repealed CON laws experienced an increase in the number of healthcare facilities and a decrease in average hospital costs. Other studies have shown similar results, indicating that repeal of CON laws can increase competition, drive down costs, and improve access to care. However, it’s important to note that the effects of CON laws can vary depending on the specific state and local market conditions.

Me: What about health outcomes?  Is repealing CON laws associated with better health outcomes?

ChatGPT: There is limited research on the relationship between CON laws and health outcomes, but available evidence suggests that repeal of CON laws may lead to improved health outcomes. For example, a study of surgery outcomes in states with and without CON laws found that states without CON laws had lower mortality rates for several surgical procedures. Other research has shown that increased competition in healthcare markets can lead to improved quality of care and better health outcomes for patients.

It’s important to note that health outcomes are influenced by many factors, and the relationship between CON laws and health outcomes is complex and difficult to quantify. Nevertheless, the available evidence suggests that repeal of CON laws can have a positive impact on health outcomes by increasing access to care and improving the quality of care delivered.

Interview: What does the term “healthcare outcomes” mean?

Me: Speaking of “healthcare outcomes” can obfuscate the real life implications of these policy decisions. When we talk of “healthcare outcomes”, we are really talking about human life, correct? Both longevity and quality of life.

ChatGPT: Yes, that’s correct. “Healthcare outcomes” is often used as a broader term to refer to the effects of healthcare on both the length and quality of life. Improving healthcare outcomes can have a significant impact on individual well-being, as well as on the larger population and economy. By increasing access to care and improving the quality of care delivered, policy changes such as repeal of Certificate of Need laws have the potential to improve healthcare outcomes and positively impact the lives of patients.

Me: Thanks, ChatGPT!

ChatGPT: You’re welcome!

Some Background on my Conversation with ChatGPT

OpenAI’s ChatGPT is a wonder to interact with. With the appropriate prompt, ChatGPT can discuss a wide variety of topics with you. I have an admission. I asked ChatGPT to discuss CON laws from a point of view that was generally anti-CON laws and pro-market solutions. Without a bit of direction, ChatGPT tends to painstakingly play both sides of an argument. With this instruction, the AI is able to highlight our side of the debate more clearly. In this case, it really came through, with examples applicable to West Virginia’s Certificate of Need regulations.

Restricting Supply Increases Prices

We quickly get to one of the worst of CON’s effects: the restriction of supply. ChatGPT highlights that by restricting the supply of healthcare facilities, CON laws often increase costs and reduce quality. The research bears this out. A study from the Mercatus Center at George Mason University found that, for West Virginia, Mountaineers spend $232 more per year on healthcare costs due to our Certificate of Need laws. 

The supply restriction also sees hospital access reduced by almost 30%. CON laws reduce ambulatory surgery center access by roughly 12%. Unfortunately, the problems don’t stop there.

CON Laws Harm Health Care Quality

CON laws also harm the quality of health care in West Virginia. If West Virginia would eliminate its CON laws, Mercatus estimates that we would experience significant decreases in negative outcomes:

• Post-surgery complications would fall by 5.1%
• Heart attack mortality would fall from 15.4% to 15.1%
• Heart failure mortality would fall from 11.7% to 11.3%
• Pneumonia mortality would fall from 12.3% to 11.8%

Additionally, readmission rates for heart attack and heart failure would fall. Plus, Mountaineers would be able to find medical imaging within their county of residence more often. Right now, they need to travel across county lines.

West Virginia is Wild and Wonderful.  Mountaineers should have every opportunity to enjoy long, high quality lives in this Wild and Wonderful state. One good way to start is aptly summed up by the recommendations of this research: “States with CON laws should consider the evidence that their regulations restricting healthcare supply may lower, rather than improve or even maintain, hospital quality. These states should also consider that repealing CON laws could save lives.”

Jacob McCoy is a Contributor to the Cardinal’s Nest Blog for the Cardinal Institute for West Virginia Policy.