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Competitor's Veto: State Certificate of need Laws Violate State Prohibitions on Monopolies

February 26, 2020
By Christina Sandefur

This paper reviews the constitutional issues involved with certificate of need laws and argues how such laws allow governments to establish monopolies.

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According to the executive summary, "CON laws, after all, violate a host of constitutional provisions, including the anti-monopoly clauses found in several state constitutions. Enabling existing providers to use the law to bar others from entering an industry or offering a service is the very definition of a government-created monopoly. Few state courts have so far directly addressed whether CON laws violate state anti-monopoly clauses, but several have noted that they are inherently anticompetitive. This paper discusses how CON laws are designed to function in precisely the way prohibited by state constitutions."