Overview of Certificate of Need (CON)

Summary of the CON Process

The following narrative provides a brief summary of the CON process. Applicants and other interested people should always refer to the applicable statute (G.S. 131E, Article 9, 175-190) and administrative rules (10A NCAC Subchapter 14C) for more complete information.

  1. Allocation of Beds and Services -- At the beginning of each calendar year, a new State Medical Facilities Plan is published by the Medical Facilities Planning Branch of DHSR which sets forth the maximum number of health service facility beds by category, operating rooms, medical equipment, home health offices, and other services that may be approved by the CON Section.
  2. Review Schedule -- In order for competitive applications to be reviewed at the same time, the CON Section has adopted a system to review applications according to a batched review schedule. Under this system, applications for similar services in the same geographic area are reviewed at the same time. Review schedules are found in the State Medical Facilities Plan.
  3. Pre-Application Procedure -- Each applicant submitting an application must submit a letter of intent (LOI) to the CON Section no later than the date the application is due. Most applicants submit an LOI as the first step in the application process. In response to an LOI submitted before the beginning of the review period, the CON Section forwards a letter to the applicant that indicates whether a CON review is required. If so, the CON Section explains the category in which the application will be reviewed, provides the beginning review dates for that category and provides the necessary application forms. An applicant may meet with representatives of the CON Section for a pre-application conference to discuss any questions relative to the CON process.
  4. Application Submittal -- Applications must be received by 5:30 p.m. on the 15th day of the month prior to the beginning of the applicable review period. When the 15th of the month falls on a weekend or holiday, the filing deadline is 5:30 p.m. on the next business day. The filing deadline is absolute. After an application is submitted, it cannot be amended, however, the CON Section may request that an applicant submit clarifying information. The CON Section reviews each application to determine if it is complete. An application is deemed complete if the correct fee is paid and the original signature page is provided. If an application is deemed incomplete, within five days the CON Section will notify the applicant of the items needed to make the application complete.
  5. Public Comment Period -- During the first 30 days of the review period, any person may file written comments or letters of support concerning the proposals under review.
  6. Public Hearing -- A public hearing is no longer required to be conducted for each proposal under review. However, under certain circumstances as set forth in G.S. 131E-185(a1)(2), a public hearing is required to be conducted by the CON Section in the service area affected by the application no more than 20 days from the conclusion of the written comment period.
  7. Application Review -- The CON Section has from 90 to 150 days to review an application for a certificate of need. Each application is reviewed against G.S. 131E-183 Review criteria and any applicable criteria and standards in the administrative rules. All written comments and presentations at the public hearing are also taken into consideration by the CON Section during the review of an application. An application must be conforming or conditionally conforming with all applicable criteria and standards in order to be approved.
  8. Appeals of Decision -- Within 30 days after the date of a decision any affected person may file a petition for a contested case hearing with the Office of Administrative Hearings (OAH). The administrative law judge must make his decision within 270 days after the petition is filed. This decision may be appealed to the N.C. Court of Appeals.
  9. Monitoring -- After the certificate is issued, the CON Section will monitor the development of the project through review of progress reports submitted by the applicant. In accordance with G.S. 131E-189, the CON Section may withdraw a certificate if the holder of the certificate fails to develop and operate the service consistent with the representations made in the application or with any conditions the CON Section placed on the certificate of need.

Health Service Facilities Regulated by the CON law [G.S.131E-175 (Article 9)]

  1. Acute Care Hospitals. [G.S. 131E-176(13)]
  2. Inpatient Psychiatric Hospitals. [G.S. 131E-176(21)]
  3. Inpatient Rehabilitation Hospitals. [G.S. 131E-176(22)]
  4. Nursing Homes. [G.S. 131E-176(17b)]
  5. Kidney Disease Treatment Centers (i.e., Certified End-Stage Renal Disease Facilities) [G.S. 131E-176(14e)]
  6. Intermediate Care Facilities for the Mentally Retarded [G.S. 131E-176(14a)]
  7. Certified Home Health Agency Offices [G.S. 131E-176(12)]
  8. Chemical Dependency Treatment Facilities (inpatient & residential) [G.S. 131E176(5a)]
  9. Diagnostic Centers. [G.S. 131E-176(7a)]
  10. Hospice Programs. [G.S. 131E-176(13a)]
  11. Hospice Inpatient Facilities. [G.S. 131E-176(13b)]
  12. Hospice Residential Care Facilities. [G.S. 131E-176(13c)]
  13. Ambulatory Surgical Facilities. [G.S. 131E-176(1b)]
  14. Adult Care Homes [G.S. 131E-176(1)]
  15. Long-Term Care Hospitals [G.S. 131E-176(14k)]

Activities Requiring CON Review [G.S. §131E-175 (Article 9)]

  1. Establishment of a new health service facility (See 1 through 15 above). [G.S. 131E-176(16)a]
  2. Capital expenditure by any person for health service in excess of $2 million dollars. [G.S. 131E-176(16)b]
  3. Change in bed capacity. [G.S. 131E 176(16)c, 176(5) and 176(9c)]
    1. Relocation of health service facility beds or dialysis stations. [G.S. 131E-176(5)(i)]
    2. Change of health service facility beds from one category to another. [G.S. 131E-176(5)(ii)]
    3. Increase in dialysis stations or health service facility beds. [G.S. 131E 176(5)(iii)]
  4. Health service facility beds are defined in G.S. 131E-176(9c) to include:
    1. Acute care beds;
    2. Inpatient psychiatric beds;
    3. Inpatient rehabilitation beds;
    4. Nursing home beds;
    5. Intermediate care beds for the mentally retarded;
    6. Chemical dependency treatment beds, including inpatient and residential;
    7. Hospice inpatient facility beds;
    8. Hospice residential care facility beds;
    9. Adult care home beds; and
    10. Long-term care hospital beds.
  5. Establishment of new dialysis services or home health services. [G.S. 131E-176(16)d]
  6. Change in project that includes cost overrun of 15% of the capital expenditure amount of an approved CON project or addition of a health service to an approved project. [G.S. 131E-176(16)e]
  7. The offering of any of the following services [G.S. 131E-176(16)f]:
    1. Bone marrow transplantation;
    2. Burn intensive care services;
    3. Neonatal intensive care services (NICU);
    4. Open-heart surgery services;
    5. Solid organ transplantation services; and
    6. Cardiac catheterization services.
  8. The acquisition of any of the following equipment [G.S. 131E-176(16)fl]:
    1. Cardiac catheterization equipment;
    2. Gamma knife equipment;
    3. Heart-lung bypass machine;
    4. Linear Accelerator;
    5. Lithotriptor;
    6. Magnetic Resonance Imaging scanner;
    7. Positron Emission Tomography (PET) scanner; and
    8. Simulator.
  9. The acquisition of a health service facility from a health maintenance organization. [G.S. 131E-176(16)l]
  10. Conversion of non-health care beds to health care beds. [G.S. 131E-176(16)m]
  11. Construction, development or establishment of a hospice, hospice inpatient facility, or hospice residential care facility. [G.S. 131E-176(16)n]
  12. Opening of an additional office by an existing home health agency or hospice. [G.S. 131E-176(16)o]
  13. Acquisition of major medical equipment ($750,000 including costs of studies, design, construction, renovation and installation). [G.S. 131E-176(14o)]
  14. Relocation of a health service facility from one service area to another. [G.S. 131E 176(16)q and 176(24a)]
  15. Conversion of specialty ambulatory surgical program to a multispecialty ambulatory surgical program or the addition of a specialty to a specialty ambulatory surgical program. [G.S. 131E-176(16)r, 176(15a) and 176(24f)]
  16. Furnishing mobile medical equipment to any person in North Carolina if not in use in North Carolina prior to March 18, 1993. [G.S. 131E-176(16)s]
  17. The construction, development, establishment, increase in the number, or relocation of an operating room or gastrointestinal endoscopy room in a licensed health service facility, other than relocation within the same building or on the same grounds or to grounds not separated by more than a public right of way from existing location. [G.S. 131E 176(16)u]
  18. The change in designation, in a licensed health service facility, of an operating room to a gastrointestinal endoscopy room or change in designation of a gastrointestinal endoscopy room to an operating room that results in a different number of each type of room than is reflected on the health service facility’s license in effect as of January 1, 2005. [G.S. 131E 176(16)v]