Palin Favors Free-Market Healthcare

In the fall of 2007, Alaska Governor Sarah Palin, now Republican candidate for Vice-President of the United States, formed a committee of health care professionals to seek solutions to the controversial Alaskan state Certificate of Need (CON) program.  This program limits competition for health care, in order to protect the availability of emergency room and other critical services currently provided by hospitals.  Two years ago, when running for governor, Palin criticized CON regulations as being an unwarranted interference with business. 

The purpose of the governor’s committee was to reach a consensus on CON reforms.  The committee included top executives of Alaska’s major hospitals, one state official, and leading private physicians from across the state.  The 21-member committee met last fall and released their report in December.  The report concluded the Certificate of Need program should not be repealed; rather, it should be revised.  Ninety percent of the committee members opposed elimination of Certificate of Need.

Ignoring the advice of her committee, the forty-four year old governor announced that she wanted to eliminate CON.  Palin said, “Market mechanisms…” are the best way to ensure that “proper business decision-making guides the development of health care services.”

In January, 2008, on the premise that health care must be market and business driven, Governor Palin introduced the Alaska Health Care Transparency Act, which would repeal CON and ensure the Alaskan health care system is responsive to market conditions.

Members of the committee and legislators said they were surprised at Palin’s decision to dismiss her committee’s advice and introduce a bill to repeal Certificate of Need.

Opponents to the repeal argued that the state should continue to regulate competition with hospitals in small markets.  Hospitals, and other providers around the state, feared the repeal of CON would allow their most profitable services to be lost to new competition.  That loss of revenue could jeopardize emergency room and other critical services.

Palin's legislative allies were unable to get floor votes in either the Alaska House or Senate, this year; and, the governor’s efforts to deregulate health care failed.

"We're very pleased that repeal of CON didn't make it through," said Shawn Morrow, CEO of Bartlett Regional Hospital in Juneau.  "The effect would have been to really weaken the community hospital we have here," he said.