Duke Health and UNC Health will again compete over who gets to expand acute-care bed capacity, the backbone of any hospital system.
In North Carolina, health services are tightly regulated. Before a hospital can expand, state health regulators must first determine a need for those added health services in a geographic area, and then decide which of the competing bids gets to add those services. This is the only way health systems in the state can grow physical capacity, meaning these regulators hold significant control over the state's health-care industry.
Related: Population growth fuels hospital competition across NC's Triangle region
Duke University Hospital proposes to add all 68 beds at its main hospital in Durham. UNC Health proposes to add 34 beds to a new hospital in Research Triangle Park named UNC Hospitals-RTP.
The Division of Health Services Regulation, part of the N.C. Department of Health and Human Services, will award the beds. It can make partial awards, so it's possible UNC could get its full request of 34 beds and Duke could get the remaining 34 beds.
As competing bids, the health systems may file written comments attacking each other's bids, a common practice. When regulators award the assets, the losing applicant may appeal the decision. In fact, UNC Hospitals-RTP is currently being appealed, meaning regulators could ultimately determine if the hospital should be built at all.
UNC Hospitals-RTP received approval as a 40-bed hospital with two operating rooms on Sept. 21. Duke University Hospital also applied for those 40 beds and two operating rooms, but was denied. It filed its appeal in October and a decision is expected this summer.
The expanded UNC Hospitals-RTP hospital has a projected cost of $279 million. The Duke proposal has a significantly smaller price tag at $4.8 million, largely because those beds would be added at an existing hospital while UNC-RTP would be a brand new location.
Typically, health system executives stay very tight lipped about projects until all appeals have run their course.
"Duke University Health System has a critical need for additional bed capacity as outlined in the CON application," said Dr. Monte Brown, vice president of administration and secretary for Duke University Health System in a written statement. "We look forward to the state's review of our application."
UNC Health released a similar statement: "Given the continued growth in the community and the importance of meeting projected health care needs, we are proposing to expand the facility from 40 beds to a total of 74 beds," it read. "UNC Health's new hospital will provide excellent care for all patients in our growing community and beyond for generations to come."
Written comments for this project are due May 31.
Unrelated to this project specifically, free-market advocates have been calling on state lawmakers to curtail the tight grip that regulators hold over the health industry, which are generally referred to as "certificate of need laws" because winning bids are awarded a Certificate of Need. At its April 11 meeting, the joint legislative committee on access to healthcare and Medicaid expansion, heard arguments to reform existing laws. Any law change proposals will be made in the coming months.
