House Health Care panel hears testimony on H.96 CON reform; advocates push $10 million threshold and birth-center exemption

Members of the House Committee on Health Care heard testimony Feb. 14 on H.96, a bill that would raise financial thresholds in Vermont's certificate-of-need (CON) law and affect which new or expanded health facilities must undergo CON review. Witnesses representing provider associations and birth-center advocates argued that the current CON regime limits competition, raises spending and blocks lower-cost options such as freestanding ambulatory surgery centers (ASCs) and birth centers.

Susan Ritzen, of Vermont Health First Independent Practice Association, told the committee she had reviewed 50 years of data and peer-reviewed studies and concluded CON laws act as “a barrier to entry” that can “drive up costs.” Ritzen cited a body of literature she summarized as 128 peer‑reviewed papers and roughly 433 individual tests; she said 78% of tests on access found CON associated with diminished availability of services and that 60% of spending‑per‑service tests associated CON with higher costs. She also said quality measures more often correlated with worse outcomes under CON programs.

Ritzen said H.96’s sponsors were seeking to increase multiple financial thresholds to $10,000,000 for construction, equipment purchase and operating budgets, and to raise the threshold for so‑called conceptual certificates of need to $50,000,000 (from about $30,000,000 under current law). She told the committee, “H96 applies that $10,000,000 threshold to ASCs,” noting that current statute and other proposals sometimes subject all ambulatory surgery centers to CON regardless of project cost.

Ritzen said Vermont’s CON program is among the country’s most restrictive, noting Vermont regulates 25 services (she cited a national comparison in which the highest number was 28) and that Vermont ranks last in the nation for the number of ASCs. She recommended applying uniform thresholds to hospital and nonhospital projects, exempting certain state‑contracted projects, and addressing CON process burdens in follow‑up legislation. On the administrative burden she said the CON process can require “hundreds of pages of documents, a lot of research, rounds of questions, lawyers, time, money.”

Committee members asked for clarifications about market impacts, hospital finances, and whether raising thresholds could allow unsafe or “fly‑by‑night” operators. Ritzen replied that licensing, certification and other existing oversight are barriers to bad actors and that “our worst case scenario is happening right now” in the form of high costs and limited access.

Shayla Livingston, a member of the Vermont Birth Center Coalition and Williston resident, testified about freestanding birth centers and asked the committee to exempt birth centers from CON or to change statutory language so that financial caps alone determine exemptions. “We are requesting to exempt birth centers from CON,” Livingston said, and also asked for the change from the statutory word “includes” to the narrower term “means” in section 1 of H.96 so regulators cannot expand the list of covered facilities beyond the financial thresholds.

Livingston described freestanding birth centers as small, home‑like facilities staffed by licensed midwives that serve low‑risk pregnancies. She told the committee freestanding birth centers are absent in Vermont: “Vermont is only one of eight states without a freestanding birth center,” and she said other states that removed CON barriers for birth centers saw more centers open. On transfers she noted that roughly “about 15 percent of births in birth centers are transferred” (mostly nonurgent) and that “2 percent of all deliveries are urgent transfers.” Livingston said birth centers offer better outcomes at lower cost and can help recruit and retain midwives.

Committee discussion touched on safety, licensing and the relationship between CON and licensure. Multiple witnesses and committee members emphasized that safety requirements—transfer agreements, equipment on hand, and midwife licensure—would be addressed through licensing and regulation rather than CON. Livingston and other witnesses said birth‑center capital costs and operating budgets likely would fall below the $10,000,000 and $3,000,000 thresholds discussed, so clarifying the statute’s exemption language is important to avoid discretionary CON determinations.

No formal votes or committee decisions were recorded during the hearing excerpt. Witnesses said they would provide follow‑up materials requested by committee members, including state birth and transfer statistics and copies of cited studies and fact sheets. The committee signaled continued review of H.96 and related process questions, including whether lower‑cost projects under the new thresholds should be subject to a simplified attestation or another review mechanism rather than full CON review.

The testimony highlights central tradeoffs the committee must weigh: whether raising or clarifying financial thresholds will expand lower‑cost care options and reduce prices for patients and payers, and how to retain oversight that protects quality and access for underserved and rural populations while minimizing administrative barriers that proponents say deter small providers and independent centers.