In Rhode Island, expanding health care services is not only a matter of financing and patient demand, many projects also require state approval through the Certificate of Need (“CON)” process, which has long served as a regulatory gatekeeper for new facilities, service expansions, and major capital investments.
While some states have scaled back or repealed their CON requirements, Rhode Island continues to maintain a comprehensive framework. For health care providers, investors, and community stakeholders, understanding the contours of this process is critical.
What Is a Certificate of Need?
The CON process is a form of regulatory oversight by the Rhode Island Department of Health (“RIDOH”) (specifically, its Office of Health Systems Development). Pursuant to R.I. Gen. Laws § 23-15-1, et seq. and associated regulations (216-RICR-40-10-22), certain health care projects must secure state approval via the CON process before proceeding.
Projects that trigger CON review include, but are not limited to:
- Construction/Establishment of a new health care facility (such as a nursing home, home nursing care provider, home care provider, hospice provider, inpatient rehabilitation center, free-standing emergency-care facility, or ambulatory surgery center).
- Major capital expenditures above certain statutory thresholds adjusted annually (for example, currently, health care equipment in excess of $3,247,713 or construction costs in excess of $7,577,998)
- An increase in bed capacity subject to certain thresholds depending on type of facility
- New or expanded tertiary or specialty care services, regardless of cost, including positron emission tomography, linear accelerators, full body resonance imaging, computerized axial tomography, cardiac catheterization services, open heart surgery, organ transplantation, and neonatal intensive care services.
- Introduction of new institutional health services with annualized costs in excess of $2,165,142, as adjusted annually;
- Any capital expenditure relating to an acquisition of an existing health care facility, if the services or the bed capacity of the facility will be changed.[1]
The central purpose and review criteria of the CON requirements focus on ensuring that new health care services are needed, financially feasible, affordable, and consistent with the state’s health planning priorities.[2]
The CON Process
There are several stages to the CON process:
- Letter of Intent – An applicant must first notify RIDOH of its intention to seek a CON. The applicant must file the letter of intent 45 days in advance of the CON application deadline.[3]
- Formal Application – The applicant must file a detailed application addressing community need, financial feasibility, alternatives considered, and anticipated impact on cost and access. RIDOH reviews the applications on two cycles – January 10 or June 10. The applicant must submit the application by those respective dates to be considered. Any application (other than expeditious review) filed outside of that date will be held for the next review cycle.[4]
- Deficiency Process – RIDOH provides any deficiency questions to the applicant within 15 working days of receipt of the application. The applicant must then respond to those questions and resubmit the application 7 days prior to the beginning of the review cycle (July 10 or February 10).[5]
- Initiation of Review – If RIDOH deems the application to be acceptable in form, it will provide notice on July 20 or February 20 of the beginning of the review cycle. After this initiation of review, RIDOH must render its decision within 120 days.[6]
- Review by the Health Services Council (“HSC”) – Following a 30-day public comment period, the HSC, an advisory body, reviews the application in public meetings, where stakeholders may provide input or raise questions.[7]
- Recommendation – The HSC makes a recommendation to the Director of RIDOH.
- Final Decision – The Director issues the final decision, which may include conditions of approval.
The process is public, transparent, and often involves input from multiple stakeholders — including community representatives, other providers, and advocacy organizations.
In evaluating a CON application, RIDOH considers factors as to whether the proposed project, for example:
- Meets a demonstrated community need;
- Is financially feasible and sustainable;
- Is affordable to the people of the state;
- Avoids unnecessary duplication of existing services;
- Promotes equitable access across populations and regions; and
- The impact of the proposal to provide an innovative approach for a more cost-effective and/or efficient health system.[8]
Practical Considerations
For those involved in health care transactions or expansions in Rhode Island, several practical considerations are worth keeping in mind:
- Timelines – The CON process extends over several months and the information required is voluminous, so early planning is essential.
- Documentation – Successful applications typically include robust data on patient need, financial feasibility, and alternatives considered. An applicant not only needs to collect this documentation but also understand that it will all be public once filed with the CON application.
- Community Perspective – Demonstrating support from the community and stakeholders, as well as highlighting proven results in other jurisdictions, can provide helpful context for the HSC and RIDOH.
- Conditions of Approval – Even when projects are approved, RIDOH will impose conditions such as reporting requirements or operational limitations.
The CON process is more than just a legal filing – it is a strategic process requiring coordination across legal, financial, and operational teams.
Conclusion
The Certificate of Need process is a cornerstone of Rhode Island’s health care regulatory framework. Whether one sees it as a necessary planning tool or as a constraint on market competition, its impact on health care development is undeniable. Given recent health care proposals in the state related to financial transparency and oversight of provider transactions, the CON process may intersect with new laws, regulations, and priorities in the future.
For providers, investors, and community stakeholders, understanding the CON process is essential for navigating the state’s health care environment. The role of CON in shaping Rhode Island’s health care future will remain a topic of close watch.
[1] See R.I. Gen. Laws § 23-15-2 and 216-RICR-40-10-22 for a full list of the specific criteria.
[2] See R.I. Gen. Laws § 23-15-1 et seq.
[3] See 216-RICR-40-10-22.10(B).
[4] See 216-RICR-40-10-22.5, 22.10
[5] See 216-RICR-40-10-22.10(G).
[6] See 216-RICR-40-10-22.10(F), 22.10(K)
[7] See R.I. Gen. Laws § 23-15-6; 216-RICR-40-10.22.10(J)
[8] See 216-RICR-40-10-22.10(L) for an exhaustive list of the specific criteria.
About The Author
Leslie D. Parker
Leslie focuses her practice on commercial litigation and health care law. Leslie’s litigation practice encompasses a wide array of matters that include health care litigation, contractual claims, business torts, employment discrimination, banking laws, fraud, and administrative law.
