The following testimony was submitted by the Grassroot Institute of Hawaii for consideration by the Senate Committee on Health and Human Services on Feb. 6, 2026.
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Feb. 6, 2026, 1 p.m.
Hawaii State Capitol
Conference Room 225 and Videoconference
To: Senate Committee on Health and Human Services
Sen. Joy A. San Buenaventura, Chair
Sen. Angus L.K. McKelvey, Vice Chair
From: Grassroot Institute of Hawaii
Ted Kefalas, Director of Strategic Campaigns
TESTIMONY IN SUPPORT OF SB2289 — RELATING TO CERTIFICATES OF NEED
Aloha Chair, Vice Chair and other Committee members,
The Grassroot Institute of Hawaii would like to offer its support for SB2289, which would exempt from certificate of need requirements certain health care facilities and services that address maternal and pediatric health, assist certain vulnerable populations, serve federally-designated medically underserved rural areas, lower patient costs or are unlikely to be overprescribed.
We commend the Legislature for taking up this bill, which has the potential to greatly improve healthcare access and affordability for vulnerable patients across the state.
As Grassroot explained in a recent white paper, Hawaii’s restrictive certificate-of-need program has become a barrier to affordable and accessible healthcare in our state, especially in rural areas and for vulnerable populations.
Required in Hawaii since the mid-1970s, medical certificates of need allegedly prove to state officials that proposed healthcare facilities, services or equipment updates are “needed” in the community. Unfortunately, research indicates that CON regulations throttle the delivery of healthcare services.
Nationwide, recent studies suggest that CON laws have the counterproductive effect of limiting healthcare quality and access, especially for rural areas and vulnerable populations. For example, consider that:
>> States with certificate-of-need laws have fewer hospitals, substance treatment facilities, psychiatric hospitals, ambulatory surgical centers, dialysis clinics, nursing home beds, open heart surgery programs and hospice care facilities.
>> CON regulations tend to lead to fewer hospital beds, decreased access to medical imaging technology and longer wait times.
>> CON regulations are linked to fewer rural hospitals and alternatives. Residents of CON states have to travel farther for care and are more likely to leave their states for care.
The effect of CON laws on vulnerable populations is especially concerning. Consider, for example, that mothers and infants in states with CON laws have an 8% higher rate of inadequate prenatal care compared to those without. In effect, strict CON laws that regulate maternal and pediatric care create scarcity in an area where more facilities, services and innovations are desperately needed.
There is no reason to make a facility jump through regulatory hoops in order to increase its number of neonatal or pediatric beds, but that’s exactly what Hawaii law requires. Given the healthcare shortages experienced throughout the state — especially in rural areas — the best thing legislators could do would be to carve out CON exemptions for facilities and services that help vulnerable populations, reduce costs or are unlikely to be used unnecessarily.
Defenders of CON laws claim they are needed to constrain high healthcare costs and guarantee access to higher-quality care. However, that is not supported by the research, which demonstrates that such laws are associated with higher per-person healthcare costs and higher death rates from treatable complications following surgery.
That is why CON reform is becoming widely implemented. More than a dozen states have fully repealed their CON programs, and even more have been partially rolling them back.
Hawaii’s certificate-of-need program is badly in need of reform. This bill would be an important step toward modernizing Hawaii’s CON laws to improve healthcare access and affordability throughout the state.
Thank you for the opportunity to testify.
Ted Kefalas
Director of Strategic Campaigns
Grassroot Institute of Hawaii
