Kentucky
Certificate-of-Need Laws in Kentucky: Current Status and Opportunities for Evidence-Based Reforms
Executive Summary
Certificate of need (CON) laws artificially restrict the supply of health care services, causing shortages, reducing quality, and increasing prices by stifling competition. These laws require health care providers to obtain state approval before initiating certain projects. CON regulations were intended to decrease health care costs by preventing the unnecessary duplication of medical services and ensuring equitable access to care. While these policies were well-intentioned, the evidence overwhelmingly indicates that CON laws have not achieved their goals.
Informed by decades of research and practical experience, many states are rolling back their CON laws or repealing them altogether. Yet, despite the growing recognition that these laws are counterproductive, Kentucky retains some of the country’s most restrictive CON rules.
This policy brief describes Kentucky’s health care challenges, examines its current CON laws, summarizes relevant empirical research, and discusses evidence-based CON reforms that would improve access and competition in Kentucky’s health care system.
Kentucky’s Health Care Landscape: Shortages, Affordability Challenges, and Infrastructure Needs
While health insurance coverage in the commonwealth has reached historic highs over the past decade, Kentuckians still struggle to receive timely, high-quality care. Shortages of critical health care providers, exacerbated by CON laws that make it costly to expand services, have lengthened wait times for routine appointments and forced patients to drive long distances for specialty care. Low levels of competition in the health-care sector have also led existing providers to raise prices, exacerbating access problems for people with low incomes.
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These shortages are such a critical problem—and not just in Kentucky—that the federal government has labeled and studied them. Health professional shortage areas (HPSAs) are areas that lack the health care infrastructure to provide adequate services to the local population. Of Kentucky’s 120 counties, 114 are classified as primary care HPSAs and 115 are classified as mental health HPSAs. Shortages are particularly common in rural counties. Kentucky needs more than 420 additional primary care and mental health professionals to resolve these shortages. Figure 1 shows Kentucky’s HSPAs.
Making care inaccessible does not reduce Medicaid spending. Kentucky’s Medicaid budget is one of the fastest-growing components of state spending, with these dollars often spent on expensive, late-stage interventions in traditional hospital settings rather than less-costly preventive and earlier-stage care. Without a regulatory environment that encourages primary care clinics and lower-cost surgical centers to open, Kentuckians will continue to face a health care system that is difficult to access, expensive for both patients and taxpayers, and increasingly unable to meet the needs of an aging population.
On average, states with CON programs have 8% higher premature mortality than states without these regulations. Premature mortality quantifies the gap between a person’s age at death and their life expectancy. As such, it reflects early deaths from causes such as unmanaged chronic diseases, certain infectious diseases, and drug overdoses that could have been prevented through better access to health services and supports. On this measure, Kentucky ranks seventh worst in the United States.
There are many real-world examples of Kentucky’s CON laws undermining access to care. Here are three that illustrate the laws’ care-denying consequences.
In 2017, a pair of Nepali immigrants attempted to open a home health agency in Louisville to provide services to Nepali-speaking residents who could not find services in their native language. The entrepreneurs’ CON application was opposed by one of Kentucky’s largest providers of home health care. Because Louisville’s existing supply of home care services already met the state’s standard of “need” based purely on number of patients, state officials rejected the CON application. The importance of customized services to accommodate language-specific communities had not been contemplated in the state health plan, so officials deemed this critical aspect of the project irrelevant in deciding whether to grant a CON.
In 2019, an effort to obtain a CON to build a $24 million ambulatory surgical center in Fort Mitchell was derailed after more than two years of litigation initiated by a rival hospital system. This action, which deprived about 170,000 residents of the surrounding Kenton County of additional outpatient surgical options, was taken despite the fact that Kentucky, on a population-adjusted basis, has less than half as many ambulatory surgical centers as the U.S. average.
In 2022, Kentucky denied a CON application by UofL Health to convert 33 acute care beds into 33 adult psychiatric beds, despite the hearing officer acknowledging that the arbitrary formulas used to determine community need were likely flawed.
These incidents reveal how well-intentioned regulations can be manipulated to serve corporate interests rather than advance the common good.
Certificate-of-Need (CON) Laws in Kentucky
Kentucky’s CON laws constitute one of the most extensive regulatory gatekeeping systems in the nation. They cover 19 specific types of facilities, from hospitals and psychiatric facilities to highly specialized facilities like kidney disease centers, hospices, and even home health agencies (see table 1).
Depending on the proposed project’s capital expenditure, CON application fees can reach $25,000. In addition, Kentucky’s CON process is so bureaucratic and convoluted that applicants often find it necessary to partner with expensive law firms specializing in CON law.
A recent analysis examined every CON application submitted in Kentucky from 2019 to mid-2023. During that time, 98 complete applications underwent substantive (formal) review, of which 71% were approved. However, incumbent providers are given broad latitude to challenge CON applications from potential competitors or to demand additional hearings to delay entry. When would-be competitors opposed the CON application, the approval rate plummeted to 43% and the average time to reach a final decision nearly doubled, from 5.4 months for unopposed applications to 10.2 months for opposed applications. Still more applications were likely never submitted due to the costly and time-consuming process.
Further, Kentucky does not merely require CON approval to open a new health care facility. Existing providers must obtain a new CON for a wide variety of activities, including capital expenditures that exceed certain thresholds, substantially increasing bed capacity or health services, acquiring major medical equipment, or altering a location designated on a previous CON.
Figure 3 compares Kentucky’s CON restrictions to those in its seven bordering states. Kentucky’s score of 100 out of 100 indicates CON barriers in every category measured. Only two bordering states received the same maximum score for CON stringency. By contrast, Indiana and Ohio have eliminated most of their CON regulations and received the lowest (best) scores.
How CON Laws Affect Patients’ Access to Health Care
Research consistently concludes that CON laws restrict supply and protect existing providers. It offers little evidence that CON laws expand access. Rather, states that repealed hospital CON laws saw an increase in hospital facilities of approximately 3.8% in rural areas and 3.9% in urban areas over the ensuing two decades. This pattern is consistent with stronger competition and broader choices for patients.
Research also suggests that CON laws can be consequential in high-need areas such as behavioral health. CON restrictions on substance use disorder treatment facilities are associated with higher emergency department use and worse health outcomes for vulnerable populations. Other work finds that substance abuse CON laws impact how treatment facilities structure payment, including reduced acceptance of private insurance, which may shape who can access care.
In Kentucky, behavioral health capacity remains a central policy concern. The state has about 70 residential substance use disorder treatment beds per 100,000 residents, one of the highest rates in the country and well above the national average, highlighting the scale of treatment demand and infrastructure in the state. This translates to roughly 3 to 4 treatment beds in a community of 5,000 residents, emphasizing both the importance of treatment infrastructure and the challenges small rural areas face in maintaining access to care. While this reflects substantial treatment capacity, policymakers continue to debate whether existing regulatory structures, including CON requirements, help maintain this capacity or instead limit how quickly providers can expand services when demand increases.
How CON Laws Affect Health Care Quality
Another longstanding claim is that CON laws improve health care quality by preventing “excess capacity” and concentrating services in high-volume facilities, The argument is that when providers perform certain procedures more frequently, they gain experience and achieve better patient outcomes, so limiting the number of providers may help ensure that services are delivered by higher volume facilities. However, the empirical evidence offers little support for this argument.
Analyses comparing hospitals in CON and non-CON states find that several mortality measures are worse in CON states. The 30-day mortality rate for heart failure is about 0.2 percentage points higher, meaning that for every 1,000 heart-failure patients discharged from the hospital, an additional two die in CON states. For pneumonia patients, the 30- day mortality rate is approximately 0.38 percentage points higher in CON states, implying four additional deaths per 1,000 discharges.
Mortality among surgical inpatients with serious treatable complications is also higher in CON states, averaging about six more deaths per 1,000 discharges. In short, the research does not show consistent quality improvements attributable to CON regulations, and in some cases it suggests the opposite.
How CON Laws Affect Health System Capacity and Costs
During the COVID pandemic, states with bed-specific CON requirements experienced higher hospital bed utilization rates and were more likely to operate near or at full capacity, suggesting tighter supply conditions. Separate research finds that in states with high hospital bed utilization, temporary CON reforms during the pandemic were associated with reductions of approximately 20 COVID-19 deaths and 30 deaths from natural causes per 100,000 residents, along with roughly 3 fewer deaths per 100,000 from other respiratory-related conditions requiring similar hospital resources. Kentucky issued temporary emergency orders that eased certain regulatory requirements to expand hospital capacity in response to surging demand.
These temporary waivers highlight that existing regulatory requirements can limit flexibility during sudden surges in demand and may require emergency intervention to allow providers to expand capacity quickly. More broadly, the literature concludes that CON laws have not reliably reduced health care spending and may instead limit competition without delivering clear cost savings.
How CON Laws Affect Cost-Shifting and Rural Hospital Stability
Many states, including Kentucky, face hospital closures that have significant community impact. CON supporters argue that limiting entry helps protect small rural hospitals from competition that may threaten already thin operating margins and reduce their ability to sustain essential services. The concern is that if new providers enter the market and concentrate on higher-margin services, rural hospitals may struggle to operate profitably.
A frequent concern among policymakers is that repealing CON laws may encourage new entrants to focus on the most profitable service lines, such as cardiac, orthopedic, or imaging services, while leaving full-service hospitals responsible for treating uninsured patients and providing less profitable services such as emergency or trauma care. Under this view, CON laws help preserve hospitals’ ability to cross-subsidize uncompensated care and to maintain broader service offerings.
However, empirical evidence on whether CON laws effectively prevent cost shifting or strengthen financial stability is mixed, and the broader literature does not clearly demonstrate that these regulations reliably protect access to care for vulnerable populations. Empirical research also does not consistently support the claim that CON laws improve rural access or stability. Evidence from states that repealed CON laws shows increases in the number of hospitals in both rural and urban areas, suggesting that entry restrictions may not be necessary to preserve rural facilities.
Evidence-Based Reforms to Kentucky’s CON Laws
Kentucky’s CON laws represent barriers to entry that prioritize the protection of incumbent businesses over patient access and market innovation. The commonwealth has an opportunity to modernize Kentucky’s approach while preserving appropriate health and safety oversight. The reforms below would ensure the state’s health system can expand and respond when and where patients need care. Many of these changes have been successfully implemented in other states. None of these reforms requires an immediate, full repeal of Kentucky’s CON program.
1. Raise project review thresholds.
Kentucky should reserve intensive CON reviews for high-dollar projects most likely to affect regional capacity planning and public spending. Raising the capital expenditure and major medical equipment expenditure thresholds that trigger CON review would reduce red tape for routine expansions, renovations, and upgrades that can improve access and reduce wait times—especially in underserved communities.
2. Streamline the review, hearing, and appeal process.
Clear guidance, accessible advisory opinions, and firm timelines for review would reduce administrative burdens and encourage investment. When providers do not know how rules will be applied—or fear that projects will be stalled in extended hearings or appeals— many choose not to proceed. Improving predictability and transparency can help restore confidence in the process.
3. Prevent conflicts of interest in the CON review process.
Reforms should limit who can trigger hearings and prolong proceedings. Instead of allowing existing providers to formally oppose new applicants, decisions should be based on clear evidence and consistent rules that focus on the needs of patients and communities rather than protecting the market share of existing providers.
4. Exempt high-need services from CON regulations.
Exempting mental health and substance use treatment services from CON regulations would help ease Kentucky’s persistent shortages in psychiatric hospital care and chemical dependency programs. Similarly, exempting rural providers from CON review would help direct investment to underserved communities. Kentucky has already taken an important step in this direction by easing CON restrictions on birth centers.
5. Eliminate CON laws for lower-cost alternatives to hospital care.
Kentucky should eliminate CON requirements for services that are unlikely to be overused and that frequently provide lower-cost alternatives to hospital care. This includes ambulatory surgical centers, dialysis centers, home health agencies, hospice care, and other specialized treatments. Access to these services is already constrained by insurance oversight and medical standards, making additional entry barriers unnecessary.
6. Codify emergency flexibility.
Introduce greater CON flexibility to improve health system resilience during public health emergencies. Kentucky’s ad hoc CON policy changes during the pandemic allowed providers to expand services and capacity more rapidly than usual but also created significant uncertainty for providers. Establishing a statutory automatic suspension of CON requirements during declared public health emergencies would help ensure that providers can scale capacity quickly when it is needed most.
Conclusion
Kentucky’s CON laws are among the most restrictive in the nation and have reduced access to vital health care services. The real impact of these laws is not just inconvenience or increased costs, but a lower quality of life for Kentuckians.
A large body of evidence indicates that straightforward reforms to Kentucky’s CON laws would yield tangible benefits for patients. Modest, incremental changes can reduce the power of entrenched interests, empower entrepreneurship, attract investment to the health care sector, and better align Kentucky’s health care regulations with the current needs of its population—all while maintaining safety oversight.
Liam Sigaud is a Research Analyst with the Knee Regulatory Research Center working within the fields of health and labor economics.
Edgar Orozco is a third-year Ph.D. student in economics at West Virginia University concentrating in health and urban economics.
NASHVILLE, Tenn. (WSMV) – The U.S. Marshals have joined the hunt for a wanted murder suspect last seen in Kentucky.
The U.S. Marshals Service reports that its Middle Tennessee Task Force is asking for the public’s help in finding Jesse Wayne Phillips.
Phillips is wanted by the TBI in connection with a murder investigation.
Previous: Man wanted in fatal Pickett County shooting added to TN Most Wanted list, TBI says
The 38-year-old was last known to be in Clinton County, Kentucky, on May 28. Phillips has an extensive violent criminal history and is considered armed and dangerous.
“Phillips is a 38-year-old white male, brown hair, brown eyes, and is 5 foot 10 inches and weighs 225 pounds,” the service said.
He’s accused of the death of Christopher B. Yates in Pall Mall from a shooting on May 27.
Up to $5,000 is available for information that leads to his arrest.
“Anyone with information is asked to contact the U.S. Marshals Service at 1-877-WANTED2 or by calling 911. Information can also be submitted via email at USMStips@usdoj.gov.”
Copyright 2026 WSMV. All rights reserved.
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What is American cuisine? It’s a very long list.
Both farm-to-table and fast-food hold space in how we define American food. What are the origin stories of authentic American cuisine?
A new WalletHub study reveals the states that spend the most money on fast food, with Kentucky ranking in the top 10.
WalletHub compared all 50 states by analyzing the cost of fast food items, including hamburgers, pizza and chicken sandwiches, and adjusting the prices based on each state’s median monthly income to determine where residents spend the most on fast food.
“With fast food prices rising by an average of 60% over the past decade, it’s fair for consumers to wonder whether the convenience of having food in minutes is really even worth it anymore,” WalletHub writer and analyst Chip Lupo said.
Here’s what to know.
Kentucky ranks No. 8 for spending on fast food
Reports from WalletHub reveal that Kentucky ranks No. 8 for spending the most on fast food, with the cost accounting for 0.42% of the median monthly household income.
U.S. states that spend the most on fast food, according to WalletHub
According to WalletHub, the 10 states with the highest spending on fast food in the U.S. are:
- 1. Mississippi
- 2. Arkansas
- 3. Louisiana
- 4. New Mexico
- 5. West Virginia
- 6. Alabama
- 7. Montana
- 8. Kentucky
- 9. Oklahoma
- 10. Florida
See states that spend the least on fast food
The states with the lowest fast food spending, according to WalletHub, are:
- 41. Washington
- 42. Colorado
- 43. Virginia
- 44. Minnesota
- 45. New Hampshire
- 46. Connecticut
- 47. Utah
- 48. Massachusetts
- 49. Maryland
- 50. New Jersey
Reach Marina Johnson at Marina.Johnson@courier-journal.com.
Kentucky
Kentucky gas tax break to expire in most of the state Thursday, extend in over 30 cities or counties
NEWPORT, Ky. — Kentucky Gov. Andy Beshear announced Tuesday that 33 cities or counties would see an extended gas tax break as his executive order to cut the tax is set to expire Thursday.
Beshear issued the executive order in early May.
The 10-cent tax break on wholesale gasoline was designed to help ease economic pressure caused by the U.S. war with Iran.
WCPO met Kyle Harris in Wilder, Ky. Tuesday as he filled up his work truck at the Shell gas station along Licking Pike.
“It’s unfortunate for everybody … anybody that has a fleet vehicle, personal vehicle, gas prices are not good for anybody,” Harris said.
WATCH: How Northern Kentucky drivers feel about the looming gas price hike
Kentucky gas tax break to expire in most of the state
Harris said he was fortunate to have a work truck that helped him save, but filling up his personal car has cost about $20 more per tank on average this summer.
“We don’t have to fill up as often, but still, the increases, you never want to see that,” Harris said. “It’s going to hurt everybody’s pockets.”
In his announcement, Beshear said it was up to local officials to receive extended relief.
“To extend the May 5 executive order past the 30-day mark of Wednesday, June 10, Kentucky law required county judge/executives and city mayors to make a request,” the release read.
In Northern Kentucky, four municipalities asked for and received an extension through June 30, including Covington, Alexandria, Glencoe and Falmouth.
We reached out to multiple municipalities and judge executives in Boone, Kenton and Campbell counties to see if they applied for an extension to the gas tax break. We only heard back from Boone County Judg/Executive Gary Moore.
Moore issued the following statement:
“I fully support any tax relief that positively impacts the citizens of Boone County. The Governor’s decision to institute an executive order is a state government decision. This is a tax freeze on the price of wholesale gas; not what residents are paying at the pump.
This is an action that may not deliver significant savings to residents and will continue to negatively impact the state road fund, which is already struggling to support needed road repairs and upkeep.
I encourage our state representatives to engage on this state issue.”
Gary W. Moore
Replay: WCPO 9 News at 11PM
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San Diego, CA41 minutes agoTatis’ first Petco homer of the year delivers crucial walk-off win
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Milwaukee, WI44 minutes agoMilwaukee Summer Activities
