Repeal Certificate of Need Laws.

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
S 1
SENATE BILL 370

Short Title: Repeal Certificate of Need Laws. (Public)
Sponsors: Senators Sawrey, Galey, and Jarvis (Primary Sponsors).
Referred to: Rules and Operations of the Senate
March 24, 2025
*S370-v-1*
A BILL TO BE ENTITLED 1
AN ACT REPEALING NORTH CAROLINA'S CERTIFICATE OF NEED LAWS. 2
The General Assembly of North Carolina enacts: 3
SECTION 1.(a) G.S. 6-19.1(a) reads as rewritten: 4
"(a) In any civil action, other than an adjudication for the purpose of establishing or fixing 5
a rate, or a disciplinary action by a licensing board, brought by the State or brought by a party 6
who is contesting State action pursuant to G.S. 150B-43 or any other appropriate provisions of 7
law, unless the prevailing party is the State, the court may, in its discretion, allow the prevailing 8
party to recover reasonable attorney's fees, including attorney's fees applicable to the 9
administrative review portion of the case, in contested cases arising under Article 3 of Chapter 10
150B, to be taxed as court costs against the appropriate agency if: 11
(1) The court finds that the agency acted without substantial justification in 12
pressing its claim against the party; and 13
(2) The court finds that there are no special circumstances that would make the 14
award of attorney's fees unjust. The party shall petition for the attorney's fees 15
within 30 days following final disposition of the case. The petition shall be 16
supported by an affidavit setting forth the basis for the request. 17
Nothing in this section shall be deemed to authorize the assessment of attorney's fees for the 18
administrative review portion of the case in contested cases arising under Article 9 of Chapter 19
131E of the General Statutes. 20
Nothing in this section grants permission to bring an actio n against an agency otherwise 21
immune from suit or gives a right to bring an action to a party who otherwise lacks standing to 22
bring the action. 23
Any attorney's fees assessed against an agency under this section shall be charged against the 24
operating expenses of the agency and shall not be reimbursed from any other source." 25
SECTION 1.(b) Subsection (a) of this section applies to contested cases arising on 26
or after January 1, 2026. 27
SECTION 2.(a) G.S. 7A-29(a) reads as rewritten: 28
"(a) From any final order or decision of the North Carolina Utilities Commission not 29
governed by subsection (b) of this section, the Department of Health and Human Services under 30
G.S. 131E-188(b), the North Carolina Industrial Commission, the North Carolina State Bar under 31
G.S. 84-28, the Property Tax Commission under G.S. 105-290 and G.S. 105-342, the 32
Commissioner of Insurance under G.S. 58-2-80, the State Board of Elections under 33
G.S. 163-127.6, the Office of Administrative Hearings under G.S. 126-34.02, or the Secretary of 34
Environmental Quality under G.S. 104E-6.2 or G.S. 130A-293, appeal as of right lies directly to 35
the Court of Appeals." 36
General Assembly Of North Carolina Session 2025
Page 2 Senate Bill 370-First Edition
SECTION 2.(b) Subsection (a) of this section applies to appeals arising on or after 1
January 1, 2026. 2
SECTION 3. G.S. 58-50-61(a) reads as rewritten: 3
"(a) Definitions. – As used in this section, in G.S. 58-50-62, and in Part 4 of this Article, 4
the term: 5
… 6
(7a) "Health care facility" means a hospital; long -term care hospital; psychiatric 7
facility; rehabilitation facility; nursing home facility; adult care home; kidney 8
disease treatment center, including freestanding hemodialysis units; 9
intermediate care facility for individuals with intellectual disabilities ; home 10
health agency office; chemical dependency treatment facility; diagnostic 11
center; hospice office, hospice inpatient facility, or hospice residential care 12
facility; or ambulatory surgical facility. 13
(8) "Health care provider" means any person who is licensed, registered, or 14
certified under Chapter 90 of the General Statutes or the laws of another state 15
to provide health care services in the ordinary care of business or practice or 16
a profession or in an ap proved education or training program; a health care 17
facility as defined in G.S. 131E-176(9b) this section or the laws of another 18
state to operate as a health care facility; or a pharmacy. 19
…." 20
SECTION 4. G.S. 58-55-35(a) reads as rewritten: 21
"(a) Whenever long-term care insurance provides coverage for the facilities, services, or 22
physical or mental conditions listed below, unless otherwise defined in the policy and certificate, 23
and approved by the Commissioner, the facilities, services, or conditions have th e following 24
definitions: 25
… 26
(10) Hospice. – As defined in G.S. 131E-176(13a).Any coordinated program of 27
home care with provision for inpatient care for terminally ill patients and their 28
families. This care is provided by a medically directed interdisciplina ry team 29
directly or through an agreement under the direction of an identifiable hospice 30
administration. A hospice program of care provides palliative and supportive 31
medical and other health services to meet the physical, psychological, social, 32
spiritual, a nd special needs of patients and their families, which are 33
experienced during the final stages of terminal illness and during dying and 34
bereavement. 35
(11) Intermediate care facility for individuals with intellectual disabilities. – As 36
defined in G.S. 131E-176(14a).Facilities licensed pursuant to Article 2 of 37
Chapter 122C of the General Statutes for the purpose of providing health and 38
habilitative services based on the developmental model and principles of 39
normalization for individuals with intellectual disab ilities, autism, cerebral 40
palsy, epilepsy, or related conditions. 41
…." 42
SECTION 5. G.S. 90-21.82A(a) reads as rewritten: 43
"(a) The following definitions apply in this section: 44
(1) Abortion clinic. – As defined in G.S. 131E-153.1. 45
(2) Ambulatory surgical facility. – As defined in G.S. 131E-176.A facility 46
licensed under Part 4 of Article 6 of Chapter 131E of the General Statutes. 47
(3) Hospital. – As defined in G.S. 131E-176.A facility licensed under Article 5 of 48
Chapter 131E of the General Statutes." 49
SECTION 6. G.S. 90-414.4(a1)(1) reads as rewritten: 50
General Assembly Of North Carolina Session 2025
Senate Bill 370-First Edition Page 3
"(1) The following providers of Medicaid services licensed to operate in the State 1
that have an electronic health record system shall begin submitting, at a 2
minimum, demographic and clinical data by June 1, 2018: 3
a. Hospitals as defined in G.S. 131E-176(13).Hospitals, defined for the 4
purposes of this section as public or private institutions which are 5
primarily engaged in providing to inpatients, by or under supervision 6
of physicians, diagnostic services and therapeutic services for medical 7
diagnosis, treatment, and care of injured, disabled, or sick persons, or 8
rehabilitation services for the rehabilitation of injured, disabled, or 9
sick persons. The term includes all facilities licensed pursuant to 10
G.S. 131E-77, except long-term care hospitals. 11
b. Physicians licensed to practice under Article 1 of Chapter 90 of the 12
General Statutes, except for licensed physicians whose primary area 13
of practice is psychiatry. 14
c. Physician assistants as defined in 21 NCAC 32S.0201.21 NCAC 32S 15
.0201. 16
d. Nurse practitioners as defined in 21 NCAC 36.0801. 21 NCAC 36 17
.0801." 18
SECTION 7. G.S. 90-414.4(b)(1) reads as rewritten: 19
"(1) Each hospital, as defined in G.S. 131E-176(13) that has an electronic health 20
record system.hospital." 21
SECTION 8. G.S. 113A-12(3)e. reads as rewritten: 22
"e. A health care facility financed pursuant to Article 1 of Chapter 131A 23
of the General Statutes or receiving a certificate of need under Article 24
9 of Chapter 131E of the General Statutes." 25
SECTION 9. G.S. 122C-23.1(e) reads as rewritten: 26
"(e) As used in this section, "residential treatment facility" means a "residential facility" 27
as defined in and licensed under this Chapter, but not subject to Certificate of Need requirements 28
under Article 9 of Chapter 131E of the General Statutes.Chapter." 29
SECTION 10. G.S. 131D-2.4(a) reads as rewritten: 30
"(a) Licensure. – Except for those facilities exempt under G.S. 131D-2.3, the Department 31
of Health and Human Services shall inspect and license all adult care homes. The Department 32
shall issue a license for a facility not currently licensed as an adult care home for a period of six 33
months. If the licensee demonstrates substantial compliance with Articles 1 and 3 of this Chapter 34
and rules adopted thereunder, the Department shall issue a license for the balance of the calendar 35
year. A facility not currently licensed as an adult care home that was licensed as an adult care 36
home within the preceding 12 months is considered an existing health service f acility for the 37
purposes of G.S. 131E-184(a)(8)." 38
SECTION 11. G.S. 131E-13(a)(1) reads as rewritten: 39
"(1) The corporation shall continue to provide the same or similar clinical hospital 40
services to its patients in medical -surgery, obstetrics, pediatrics, outpatient 41
and emergency treatment, including emergency services for the indigent, that 42
the hospital facility provided prior to the lease, sale, or conveyance. These 43
services may be terminated only as prescribed by Certificate of Need Law 44
prescribed in Article 9 of Chapter 131E of the General Statutes, or, if 45
Certificate of Need Law is inapplicable, by review procedure designed to 46
guarantee public participation pursuant to rules adopted by the Secretary of 47
the Department of Health and Human Services." 48
SECTION 12. G.S. 131E-84(a1) reads as rewritten: 49
"(a1) In the event of a declaration of a state of emergency by the Governor in accordance 50
with Article 1A of Chapter 166A of the General Statutes, a declaration of a national eme rgency 51
General Assembly Of North Carolina Session 2025
Page 4 Senate Bill 370-First Edition
by the President of the United States, a declaration of a public health emergency by the Secretary 1
of the United States Department of Health and Human Services; or to the extent necessary to 2
allow for consistency with any temporary waiver or modific ation issued by the Secretary of the 3
United States Department of Health and Human Services or the Centers for Medicare and 4
Medicaid Services under section 1135 or 1812(f) of the Social Security Act; or when the Division 5
of Health Service Regulation determi nes the existence of an emergency that poses a risk to the 6
health or safety of patients, the Division of Health Service Regulation may do either or both of 7
the following: 8
(1) Temporarily temporarily waive any rules of the Commission pertaining to 9
hospitals. 10
(2) Notwithstanding G.S. 131E-183, allow a hospital to temporarily increase its 11
bed capacity." 12
SECTION 13. G.S. 131E-136(4) reads as rewritten: 13
"(4) "Home health agency" means a home care agency which is certified to receive 14
Medicare and Medicaid reimbursement for providing nursing care, therapy, 15
medical social services, and home health aide services on a part -time, 16
intermittent basis as set out in G.S. 131E-176(12), and is thereby also subject 17
to Article 9 of Chapter 131E.basis." 18
SECTION 14. The following laws are repealed: 19
(1) Article 9 of Chapter 131E of the General Statutes. 20
(2) G.S. 130A-45.02(i). 21
(3) G.S. 131E-78.3(c). 22
(4) G.S. 131E-146(3), as enacted by Section 3.2(b) of S.L. 2023-7. 23
(5) G.S. 131E-147.5, as enacted by Section 3.2(c) of S.L. 2023-7. 24
(6) G.S. 143B-1292. 25
(7) G.S. 150B-2(8a)k. 26
(8) G.S. 150B-21.1(a)(6). 27
SECTION 15. This act becomes effective January 1, 2026. 28