Senate passes bill addressing the closures of rural hospitals

The Georgia Senate on Thursday passed a bill that would allow “micro-hospitals” to open in small counties under certain conditions.

Under House Bill 769, a microhospital would have to have between two and seven beds and offer around-the-clock emergency services.

The idea is part of an effort to address rural Georgia’s hospital funding crisis. Under the bill, if a failed hospital in a county of fewer than 50,000 people closed within the past 12 months, or is “closing,” then a neighboring hospital could buy the rights to operate that facility and turn it into a micro-hospital.

It’s unclear how many hospitals would be interested in doing that in Georgia, since a hospital emergency room is typically a money-loser. Estimates in interviews with lobbyists and the senator sponsoring the bill ranged from zero to a handful.

The purchasing hospital would have to be located in a neighboring county. It could also relocate the facility as a micro-hospital within 3 miles and within the same county.

Now that HB 769 has passed the Senate, it goes back to the House, where Senate changes will come under scrutiny.

The central idea of micro-hospitals comes from high-ranking House leaders, so that is likely to retain support there. The Senate changes included narrowing who could buy the rights to a failing hospital.

The right to open a hospital has closely guarded restrictions. Existing hospitals don’t want private companies to cherry-pick their few profitable services and leave them with moneylosers such as emergency rooms. So legislation about that restriction, called “certificate of need,” or CON, is always contentious.

On Wednesday a House committee hearing on CON restrictions fairly exploded, with Health and Human Services Chairwoman Sharon Cooper, R-Marietta, and Georgia Hospital Association lobbyist Ethan James speaking in forceful tones and interrupting each other over a bill that had been suddenly amended to help the private hospital chain Cancer Treatment Centers of America. In that meeting no vote was held on that bill, Senate Bill 31.

The Georgia Hospital Association and the Georgia Alliance of Community Hospitals each said it supports the Senate version of the bill that passed the Senate on Thursday, House Bill 769.

HB 769 also included provisions to increase tax credits donors could receive for donating to rural hospital organizations.