Bill
HB 735
HB 735 exempts psychiatric facilities and mental health services from Maryland's Certificate of Need, speeding entry/expansion and shifting planning away from MHCC.
Status & Key Dates
- Title: Certificate of Need – Psychiatric Health Care Facilities and Psychiatric and Mental Health Services – Exemption
- Introduced: (House) Jan. 27, 2025 (per bill text); user notes initial filing Nov. 12, 2024.
- Committee hearing: Feb. 26 at 1:00 p.m. (per provided status)
- If enacted: bill text sets effective date Oct. 1, 2025.
- Companion/Related: SB 823 (companion); similar prior proposals (e.g., HB 804 in an earlier session).
- Sponsors (from bill filings): Delegates Grammer et al. (multiple co-sponsors listed in bill text).
Purpose / Intent
- Remove psychiatry and subcategories of psychiatry from the set of health services covered by Maryland’s Certificate of Need (CON) program, and explicitly exempt psychiatric health care facilities and psychiatric/mental health services from CON review and approval requirements. The intent is to eliminate CON as a regulatory barrier to creating or expanding psychiatric capacity and providing psychiatric/mental health services.
What the bill would change (substantive provisions)
- Amends Article — Health — General: modifies Section 19‑120(a) and (j) and adds a new Section 19‑122.1.
- Removes “psychiatry” (and subcategories) from the statutory definition/list of “medical service” categories subject to CON requirements.
- Adds §19‑122.1: “Notwithstanding any other provision of law, a certificate of need is not required to (1) establish or operate a psychiatric health care facility; or (2) offer psychiatric or other mental health services at a health care facility, regardless of whether the health care facility otherwise requires a CON.”
- Broad exemption: applies both to stand‑alone psychiatric facilities and to psychiatric/mental‑health services provided inside facilities that otherwise would trigger CON review.
Who would be affected
- Directly affected:
- Providers: hospitals, specialty psychiatric hospitals, behavioral health providers, outpatient mental health clinics, and new entrants seeking to open psychiatric beds or offer psychiatric services.
- Regulatory bodies: Maryland Health Care Commission (MHCC), which administers the CON program, would no longer review psychiatric facility/service projects covered by this change.
- Indirectly affected:
- Patients and communities: potential changes to access, provider choice, and geographic distribution of psychiatric services.
- Payers and competing providers: market dynamics could shift if new facilities/services enter without CON review.
Fiscal and practical impact
- Fiscal note (Department of Legislative Services): the change is technical in nature and does not directly affect state or local finances; no anticipated fiscal impact.
- Practical impacts (expected/possible):
- Likely reduction in time and regulatory costs for entities that want to open psychiatric facilities or add psychiatric services (faster entry/expansion).
- Potentially increased supply of psychiatric services and more competition, which may improve access in some areas.
- Reduced statewide capacity‑planning oversight: MHCC would have less ability to assess whether new psychiatric services are the most cost‑effective, geographically appropriate, or will affect existing providers’ viability. This could raise concerns about duplication of services in some markets and gaps in others.
Procedural notes / statutory detail
- Specific statutory sections amended: 19‑120(a) and (j) (definition and CON triggers) and new 19‑122.1 (explicit CON exemption).
- Effective date provision in the bill: Oct. 1, 2025 (if enacted as written).
Bottom line
HB 735 would remove psychiatry and psychiatric/mental health services from Maryland’s CON review process and expressly exempt psychiatric facilities and services from needing a CON. The change aims to reduce regulatory barriers and accelerate service expansion, while shifting oversight and planning responsibilities away from the CON process. According to the fiscal analysis, the bill has no direct fiscal impact on state or local government.
Compiled from official sources — confirm details with the bill’s official record.
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