How [CLIENT ORGANIZATION] Prevailed in a Contested CON Application Against Incumbent Opposition

Client Overview

The Challenge

Option A — Contested ASC Application

[CLIENT], a [X]-physician independent surgical group in [City, State], sought to develop a [specialty] ambulatory surgery center serving [proposed service area]. The group had identified significant unmet demand based on [growing population / waiting times at existing facilities / lack of outpatient surgical capacity in the service area].

Within the competing applicant window, [INCUMBENT HOSPITAL] filed a competing application for a hospital-owned outpatient surgical program in the same service area. This triggered a comparative review process requiring [CLIENT] to demonstrate not only that its project met community need, but that its proposal was superior to the incumbent's competing application under the state's comparative review criteria.

[STATE CON LAW CONTEXT: e.g., Under [State] CON law, comparative review evaluates need, financial feasibility, quality of care, workforce availability, and consistency with the State Health Plan — in that priority order.]

Option B — Home Health / Hospice in North Carolina

[CLIENT], a [home health / hospice] operator with existing operations in [State(s)], sought to establish a new agency in [County/Region], North Carolina. The proposed service area demonstrated unmet need based on [aging population growth / existing agency capacity constraints / geographic gaps in service coverage].

North Carolina's CON law requires State Medical Facilities Plan (SMFP) approval for new home health and hospice agencies before state licensure can proceed — and licensure must precede CHAP or ACHC accreditation and Medicare certification. The combined SMFP + licensure + accreditation + certification sequence required careful timeline management to prevent any single step from stalling the others.

[Additional context: e.g., An existing home health agency in the proposed service area filed a competing application during the comment period, arguing that existing capacity was sufficient to serve the projected need.]

Option C — Post-Legislative Change (Georgia / Iowa / New York)

[CLIENT] had been planning a [project type] in [State] under the prior CON framework. [Georgia HB 1339 (2024) / Iowa's July 2025 threshold update / New York's August 2025 update] changed the applicable CON requirements, requiring [CLIENT] to reassess whether the project still required CON approval and, if so, under what revised criteria.

Baseline Risk Assessment

IHS conducted a pre-application competitive analysis that identified the following risks:

• [RISK 1: e.g., Incumbent's competing application would argue that existing hospital outpatient surgical capacity was adequate to meet projected demand — requiring a need analysis built on geographic access data, not just aggregate capacity]
• [RISK 2: e.g., State health plan methodology used bed-to-population ratios that did not reflect actual utilization or wait times — requiring supplemental analysis demonstrating functional unavailability of existing capacity]
• [RISK 3: e.g., Financial projections needed to demonstrate viability without relying on case volume assumptions the incumbent would challenge at public hearing]
• [RISK 4 — NC specific, if applicable: e.g., SMFP review cycle timing required LOI filing by [date] to avoid a [X]-month delay to the next review cycle]

IHS Approach

Phase 1 — Pre-Application Strategy and LOI (Month 1)

IHS conducted a CON threshold analysis confirming that [CLIENT]'s project triggered review under [State] CON law and identifying the applicable review criteria. The competitive landscape analysis identified [INCUMBENT] as the most likely competing applicant and mapped the specific need analysis arguments the incumbent was likely to advance.

IHS drafted the Letter of Intent to accurately characterize the project scope while preserving flexibility for the detailed application. The LOI was filed [on time / X days before deadline].

Phase 2 — Need Analysis Development (Months 1–3)

The need analysis was the determinative element of the application. IHS built the analysis using [specific methodology]:

• [ANALYSIS ELEMENT 1: e.g., Demographic modeling — census data and population projections for [X]-year horizon for the proposed service area, demonstrating [X]% projected growth in the [65+/surgical-age] population]
• [ANALYSIS ELEMENT 2: e.g., Utilization analysis — procedure volume data from [state discharge database] showing [X]% utilization of existing outpatient surgical capacity, with documented wait times of [X] weeks for [specialty] procedures]
• [ANALYSIS ELEMENT 3: e.g., Geographic access analysis — drive-time mapping demonstrating that [X]% of the proposed service area population was beyond [X] minutes from existing ASC capacity — the state's geographic access standard]
• [ANALYSIS ELEMENT 4: e.g., State health plan consistency — application structured to satisfy [State]'s published ASC need methodology, demonstrating [X] procedures of unmet need under the methodology]

Phase 3 — Competing Application Response (Month [X])

[INCUMBENT]'s competing application argued [summary of incumbent's need analysis position]. IHS prepared [CLIENT]'s written response to the competing application, directly addressing each of the incumbent's need analysis claims with countervailing data and methodology arguments.

[SPECIFIC RESPONSE STRATEGY: e.g., The incumbent relied on aggregate bed-to-population ratios that masked the geographic maldistribution of existing capacity. IHS's response demonstrated that [X]% of the service area population was geographically underserved by existing facilities — a functional need argument the aggregate methodology could not capture.]

Phase 4 — Financial Projections and Application Package (Months 2–4)

IHS developed the full application package including:

• Pro forma income statements, balance sheets, and cash flow projections over [X]-year project period
• Facility plans and architectural summary
• Staffing model with licensed personnel requirements and recruitment strategy
• [NC specific: Quality Assurance Plan demonstrating readiness for CHAP/ACHC accreditation concurrent with SMFP application]

Phase 5 — Public Hearing Preparation and Testimony (Month [X])

The state agency scheduled a public hearing for comparative review of [CLIENT]'s application against [INCUMBENT]'s competing application. IHS prepared [CLIENT]'s hearing testimony addressing:

• Community need — direct rebuttal of incumbent's aggregate capacity argument with geographic access data
• Financial feasibility — projection assumptions and sensitivity analysis
• Quality of care — [CLIENT]'s clinical quality credentials and quality assurance plan
• Workforce — documented recruitment commitments and staffing feasibility

Thomas G. Goddard, JD, PhD [appeared at hearing / provided regulatory legal analysis for hearing counsel / provided expert analysis supporting hearing testimony].

Results

Client Perspective

"[CLIENT QUOTE — e.g., The incumbent's competing application was filed within days of our LOI. IHS had already anticipated it and built our need analysis to withstand exactly the arguments they made at the hearing. We didn't win because we had more resources — we won because our analysis was better.]"

— [TITLE], [ORGANIZATION NAME]

Key Takeaways for Healthcare Organizations Pursuing CON Approval

1. Pre-application competitive intelligence determines strategy. Identifying likely competing applicants before filing the LOI allows you to build a need analysis that anticipates and addresses their arguments — not one that reacts to them after the fact.
2. Geographic access analysis defeats aggregate capacity arguments. Incumbents routinely argue that aggregate bed or procedure volume capacity is sufficient. Geographic access analysis demonstrating functional unavailability of that capacity is the most effective counter-argument.
3. State health plan methodology must be your primary framework. Applications that use proprietary methodologies inconsistent with the state's published criteria lose comparative reviews even when the underlying need is real.
4. Combined CON + accreditation timelines require integrated management. For North Carolina home health and hospice, the SMFP → licensure → accreditation → certification sequence must be managed as a single project with interdependencies, not as four sequential independent applications.

Facing a CON Application — Contested or Uncontested?

Whether you are navigating a straightforward application or preparing for incumbent opposition, IHS builds CON applications with the need analysis rigor and hearing preparation that produces approvals.