Michigan Nursing Home Administrator (NHA) Practice Exam

What does “certificate of need” authorize?

1. A merger with another health facility

2. A change in bed capacity

3. A transfer of ownership

4. A loan for facility improvement

The correct answer is: A change in bed capacity

A "certificate of need" (CON) is a legal document required in many states, including Michigan, to ensure that the initiation or expansion of health care facilities and services meets the needs of the community, thereby avoiding unnecessary duplication of services. The primary purpose of a CON is to assess whether there is a true need for new or expanded healthcare services, thereby promoting the efficient use of health care resources. The issuance of a CON specifically authorizes changes in bed capacity, which can include adding more beds to an existing nursing home or establishing new capacity in other healthcare settings. This process involves a review that considers community health needs, current services, and the potential impact on existing facilities. By requiring a CON for changes in bed capacity, regulators aim to ensure that any expansions are justified and based on demonstrated community needs. This regulatory framework helps balance the provision of care with the availability of resources, serving both the healthcare system and the public interest. Other options listed, such as a merger with another health facility, a transfer of ownership, or a loan for facility improvement, may involve different regulatory requirements and do not directly relate to the issuance of a certificate of need.