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HSDA Rulemaking (Updated)

Certificate of Need History

The Health Services and Development Agency is the successor to the Health Facilities Commission, which administered the Certificate of Need process from 1973 through 2002.

In the 1970's, the federal government urged states to control the rising health care costs by managing the growth of health care services and facilities through health planning.  In 1973, the Tennessee General Assembly created the Health Facilities Commission to administer the Certificate of Need program.

In 1974, the federal government enacted the National Health Planning and Resources Development Act, which among other things, provided federal funds to assist with state health planning. The Act was repealed in 1987, resulting in the loss of federal funds and a reduction of the state's planning staff.

The Health Services and Planning Act of 2002 created the Health Planning and Advisory Board, which is to draft and review annually the state's health plan.  The Act also created the Health Services and Development Agency, which administers the Certificate of Need program and provides administrative staff for the Health Planning and Advisory Board.  In 2004, the Legislature terminated the Health Planning and Advisory Board, and transferred its functions to the Department of Finance and Administration.

In 2016, PC1043 made significant changes to the CON program by eliminating a number of services from review, adding one new service, modifying other provisions, and adding  a fourth criterion for certificate of need — health care that meets appropriate quality standards.  The legislation also added a requirement regarding maintaining continuing oversight over any certificate of need granted after July 1, 2016 concerning continued need and appropriate quality measures as determined by the agency.