1. Approach to Overcapacity
Janet Olszewski, Director
Michigan Department of Community Health (MDCH)
October 14, 2010

2. Certificate of Need Objectives
The Certificate of Need (CON) program:
Promotes and assures availability and accessibility of quality health services at a reasonable cost and within regional proximity
Balances cost, quality and access in its regulations
Is not intended to limit competition
Does contain unbridled growth and its adverse impact on cost and quality

3. CON Overview
The CON Commission is an 11-member body appointed by the Governor and represents various health care stakeholders. Commissioners serve 3-year terms.
The Commission sets standards for covered health facilities and services.
MDCH verifies that applicant’s proposed projects meet the applicable standards set by the Commission and other requirements set forth in the Public Health Code.
The Director of the MDCH issues the final decision to approve or disapprove a proposed project.

4. CON in Action
In 2006 and again in 2008, the CON Commission revised Review Standards for surgical and computed tomography (CT) services.
The commission strengthened both methodologies based on an extensive review by experts in these fields along with consumers, purchasers, payers, etc.
Unlike many states where moratoriums are often used to limit growth, Michigan’s CON program continues to allow for new services as long as well documented need can be demonstrated.

5. CON Impact on CT & Surgical Services
* CON CT Standards modified May 2008
* CON Surgical Standards modified January 2006

6. Bed Need Methodologies
Determination of Bed Need Methodologies for:
Hospital Beds
Nursing Home/Hospital Long Term Care Units
Psychiatric Beds and Services
Neonatal Intensive Care Services/Beds
Matching bed availability with demonstrated need keeps a balance aimed at controlling cost and assuring access

7. Bed Need Methodologies
The methodologies in the standards vary based upon on the nature of the beds
Factors used to develop methodologies include:
Population rates
Age
Geographic areas
Identified planning areas
Current utilization patterns

8. Hospital Bed Need By Health Service Areas
HSA 1
59 Hospitals
13,923 Licensed Beds
61.5% Occupancy Rate
2,807 Excess Beds
HSA 2
13 Hospitals
1,653 Licensed Beds
56.2% Occupancy Rate
224 Excess Beds
HSA 5
6 Hospitals
1,455 Licensed Beds
68.4% Occupancy Rate
105 Excess Beds
Source: 2009 Annual Survey Data, CON Evaluation Section, MDCH.

9. Hospital Bed Need By Health Service Areas
HSA 3
18 Hospitals
2,015 Licensed Beds
48.5% Occupancy Rate
505 Excess Beds
HSA 4
26 Hospitals
2,970 Licensed Beds
51.7% Occupancy Rate
778 Excess Beds
HSA 6
25 Hospitals
2,325 Licensed Beds
49.3% Occupancy Rate
595 Excess Beds
HSA 7
12 Hospitals
1,096 Licensed Beds
52.1% Occupancy Rate
145 Excess Beds
HSA 8
15 Hospitals
801 Licensed Beds
37.7% Occupancy Rate
199 Excess Beds
Source: 2009 Annual Survey Data, CON Evaluation Section, MDCH.

10. CON and New Technology
By statute CON Commission must appoint a new medical technology committee (NEWTAC)
NEWTAC helps CON Commission identify new medical technology or services that may be appropriate for inclusion as a CON regulated clinical service
NEWTAC can review new technology beyond the definition of the statute as assigned by CON Commission. Recent examples:
DaVinci Robots
Vascular Surgery
Interoperative MRI
Neuro-interventional radiology
Proton Beam Megavoltage Radiation Therapy