The Verdict
Rhode Island
Rhode Island's long-standing and expansive Certificate of Need program creates significant barriers to entry, protecting incumbent health systems and limiting consumer choice. The state's healthcare market is highly concentrated, with a few dominant players.
Restrictiveness Score
80/100
CON Law Enacted
1970
Regulated Services
18
Dominant Systems
3
Governor
Dan McKee (D)
What CON Covers
What Services Require a CON?
- Hospitals & Nursing Homes
- Inpatient Rehabilitation Centers
- Freestanding Surgical Facilities (ASCs)
- Home Care & Hospice Agencies
- Bed Expansions (>10 beds or 10%)
- Cardiac Catheterization & Open-Heart Surgery
- Organ Transplant Services
- PET, MRI, and Linear Accelerators
- New services with >$1.7M annual operating cost
- Capital expenditures >$5.9M
The Application Gauntlet
| Reviewing Agency | Dept. of Health, Health Services Council |
| Application Fee | $500 - $10,000 + 0.25% of project cost |
| Application Timeline | 120 days (reviews twice per year) |
| Competitor Intervention | Yes, explicitly allowed |
Who Benefits
Hospital Market Concentration
The hospital market is an oligopoly, with Lifespan (Brown University Health) and Care New England controlling ~80% of acute-care beds.
Insurer Market Concentration
BCBS of Rhode Island dominates the commercial market with a staggering 76% share in the large-group market.
Dominant Systems
Lifespan, Care New England, and CharterCARE are the three largest systems, controlling the majority of inpatient volume.
The Human Cost
Case Study: Encompass Health Denied
In 2021, a proposal by Encompass Health to build a new 50-bed inpatient rehab hospital was overturned on appeal from existing providers. The stated reason was a lack of public need, effectively protecting incumbent hospitals from new competition and forcing patients to rely on existing, potentially overburdened, facilities.
Reform Status
Rhode Island's CON law has been amended over 25 times but never fully repealed. A 2026 bill to repeal the statutes was introduced but has not passed, indicating that significant reform is not on the immediate horizon. The state remains committed to its CON regime, with periodic adjustments rather than a fundamental overhaul.
The Rojas Report Take
Rhode Island's healthcare landscape is a textbook example of regulatory capture. For over half a century, the state's Certificate of Need law has acted as a fortress, shielding a handful of powerful hospital systems from meaningful competition. With three systems controlling the vast majority of inpatient care and one insurer holding a near-monopolistic 76% of the large-group market, the deck is stacked against new entrants and, ultimately, against patients. The denial of Encompass Health's new rehabilitation hospital, explicitly to prevent 'cannibalizing' the existing system, says it all: in Rhode Island, the health of the incumbents is prioritized over the health of the market. It's a closed loop of entrenched interests, and Rhode Islanders are paying the price.