Dr. Gajendra Singh wanted to make MRIs cheaper, but a state law stands in his way—so he is taking the state to court.
Singh is a doctor in Winston-Salem, North Carolina. According to Vox, Singh started a small practice, advertising that he offered MRI exams for $500. The average exam in North Carolina is more than double that price.
Unfortunately for Singh and the people of North Carolina, a state law essentially made MRI services, along with many other medical devices, a monopoly.
The law requires that Singh attain a “certificate of need.” Without this certificate, the doctor cannot buy an MRI machine for his office. Instead, he must rent a mobile machine that he can only use a few times a week.
“Those patients need imaging. As a surgeon, we need to see what we’re going to do. We often need a lot of imaging,” Singh told Vox.
Today, an MRI scan in an emergency room can cost as much as $24,000, and these “certificate of need” requirements only fuel the high costs.
The required certificates are distributed based on the perceived need for the new equipment in the eyes of state lawmakers. Because North Carolina lawmakers decided Winston-Salem didn’t need another provider, Singh can’t move forward with his cheaper services.
The only option the doctor has is to apply for a certificate, a process that can take three years and cost around $400,000 — more than half the cost of the MRI machine itself.
Besides that, current certificate holders can contest the certificate distribution, slowing the process even further. Almost every permit has been contested.
At one time, 49 states had these requirements, but 14 states have repealed the laws after realizing it prevented competition in the medical industry.
Singh believes these laws breach North Carolina’s constitution because the constitution prevents monopolies.
“Competition is good for the community,” Singh told Vox, adding, “We will pay less money by owning an MRI. We will generate more money. I can reduce my prices further down — and maybe make some money.”
Many conservatives have pointed to this law as an example of government stepping in and making things worse.
“Certificate of need” laws ARE CRAP!!!!!!!!!!!!!!!!
Instead of a business saying “ooh maybe people would like this service,” they have to ask government who may or may not decide to allow it. SPOILER: It favors incumbent businesses, raises prices https://t.co/ET9p0Tm7oj pic.twitter.com/drGhtkSeBe
— Shoshana Weissmann, Sloth Committee Chair (@senatorshoshana) July 31, 2018
I am SHOCKED that government regulations are detrimental to patient costs and quality of care.
— Very Stable Raybs (@RayburnThompson) July 31, 2018
Singh’s attorneys at the Institute for Justice argue that the “certificate of need” requirement impedes the doctor’s right to equal protection to earn a living — a right that is guaranteed in the state’s constitution.