Certificate of Need and the Necessity of Expanding Outside of Iowa City

Just north of Iowa City, which is the location of the most comprehensive academic teaching hospitals in the state, the city of North Liberty is becoming home to the newest branch of the University of Iowa health care. Set to open in 2025, the North Liberty building sits on 60 acres and contains clinical rooms as well as teaching and research facilities. Construction More Than Halfway Completed for UI Health Care North Liberty Campus | University of Iowa Health Care (uihc.org). The goal of the building is to continue to provide top-of-the-line care to Iowans in locations closer to home. The new building allows for the residents of Coralville, North Liberty, and surrounding areas to receive complex care in an area even closer to home.  

Prior to breaking ground on the new building, there were various hurdles that needed to be crossed, with the biggest being receiving approval from the state. In the state of Iowa, it is a crime for doctors to open new locations to offer services without first obtaining a Certificate of Need. Iowa Certificate of Need - Institute for Justice (ij.org).

This law does not focus on the safety of the patients, as there are other laws – both at the state and federal level – that govern what kind of medical procedures are permitted. The Certificate of Need law only regulates if someone may open a new medical facility and helps to ensure the newly requested facility will not take patients and customers from previously established facilities.  

The purpose of the Certificate of Need law seemingly cuts against the goal of the new facility being built in North Liberty, Iowa, which is to provide patients with care options closer to home. Unsurprisingly, the law has been under significant criticism since 1977.

In 2017, medical providers, one of which was out of Cedar Rapids, filed a complaint alleging that Iowa’s Certificate of Need law violates Equal Protection, Due Process, and Privileges and Immunities Clauses of the Fourteenth Amendment.

As mentioned above, the law does not regulate any safety policies or procedures. Rather, it “arbitrarily prevents medical entrepreneurs from offering safety, less costly, and more convenient medical procedures. . .” with the “only purpose [being]. . .to protect established Iowa healthcare facilities from economic competition.” Iowa Certificate of Need Law Under Constitutional Attack (brownwinick.com). The Court did not find the attacks on the constitutionality of the law convincing, as the North Liberty facility had to undergo battles to be approved for a Certificate of Need.  

While the facility is set to open in 2025, it has been nearly a 5-year ordeal in order to get to the point of opening. In February 2021, the University of Iowa Hospitals and Clinics submitted a request for approval to build the new facility.

The proposal included details of the build, with the understanding that it would cost $230 million to build and be home to 48 hospital beds. The request was denied on the basis that the build would negatively impact Mercy Iowa City and UnityPoint Hospital in Cedar Rapids.  

The University filed a second application in August 2021. In support of the second application, UIHC CEO Suresh Gunasekaran states that the denial of their proposal for the new building harmed the residents of the state of Iowa. The harm sustained is a result of the limited capacity of the main University Hospital located in Iowa City. 

In addition to limitations on capacity, the current building also limited the number of academic training that doctors would be able to receive. Additional capacity would permit furthering both the accessibility of medical care and the number of individuals able to provide such care. UIHC North Liberty hospital proposal gets greenlight from state board - The Daily Iowan. The request for a Certificate of Need was ultimately approved on August 31, 2021. 

While the Certificate of Need Law continues to receive scrutiny, the University was able to successfully prove that the area north of Iowa City needs additional access to medical care, and such care is necessary due to the shortage of clinical rooms and educational and research facilities that the Hospital currently has.

There is no denying that there are medical facilities and providers who are not in support of the new build due to the competition it brings. That being said, this will likely not be the last time that the Certificate of Need Law receives scrutiny, nor will it be the last time that the state of Iowa needs to expand and add to the availability of medical facilities.  

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