| That’s what state regulators are learning right now in our lawsuit challenging Mississippi’s Certificate of Need (CON) laws and home health ban. Our client is Butch Slaughter, a physical therapist who owns a clinic in south Jackson. When COVID arrived, many of his patients stopped coming in. Even today, many are reluctant to come and cancellations are routine. He also knows that elderly patients need physical therapy now more than ever, as many seek to delay or prevent the need to receive care in nursing homes, which have been prone to outbreaks. So, Butch had a simple idea: he would open a home health agency so that he could provide care to patients in the comfort and privacy of their own homes. |
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| But it wasn’t so simple. It turns out that opening a home health agency in Mississippi is illegal, and has been for 40 years. Not because they are unsafe – several other home health agencies are operating in the state. Rather, they are illegal because the state government says more aren’t “needed.” Translation: the government is shielding existing home health businesses from competition. This, despite the fact that the demand for home health services has at least tripled since the state decided there was no more “need.” Even if this ban were lifted, Butch would still have to apply for CON before he could open. His competitors would then get to drag him into court and make him spend tens of thousands of dollars to try to prove his business was “needed.” Imagine if we had told Netflix they weren’t “needed” because we already had Blockbuster. This racket doesn’t just affect Butch. It hurts all of us. If you have ever had to travel to find quality care or paid exorbitant prices for mediocre care: it’s likely that health care CON laws were to blame. |
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| Multiple bills have been introduced to remove the home health ban and CON requirement, but the state legislature has taken no action. So Butch teamed up with the Mississippi Justice Institute, and we sued. In response to our claims that these laws violate Butch’s constitutional rights, the government argued that our lawsuit should be dismissed out of hand because our claims weren’t even plausible. But recently, the federal judge overseeing the case disagreed and allowed the lawsuit to proceed. In his order denying the motion to dismiss, the judge notes that “It is no secret that significant financial interests are at stake when it comes to CON laws.” He explained that “Rent-seeking businesses make a sort-of ‘extra-legal’ contract with politicians: money and votes for the politicians, regulations that ensure a monopoly for the interest group. Meanwhile, consumers lose out. Without the market competition that normally regulates businesses’ behavior, the monopoly can charge otherwise unsustainably high prices for otherwise unsustainably mediocre products.” In other words: pure cronyism. This doesn’t necessarily mean that Butch will succeed in having the laws struck down. But it does mean the government will actually have to defend the laws in court. At the Mississippi Justice Institute, we are looking forward to that fight. |
In Liberty,
Aaron Rice
Director, Mississippi justice Institute