Mercy requested an administrative hearing before the CON Board.

On Oct. 10, 2012, Mercy Crystal Lake Hospital and Medical Center, Inc., and Mercy Alliance, Inc. (collectively, Mercy), requested an administrative hearing before the Illinois Health Facilities and Services Review Board (the Board) in connection with the denial of Mercy’s application for a certificate of need (CON) permit to build a 70-bed, $115 million hospital in Crystal Lake, Illinois, in December 2011. Following the Board’s December 2011 denial, Mercy had initially requested an administrative hearing before the Board, in a letter dated January 9, 2012; Mercy’s hearing, however, was not completed then due to an error in the underlying record regarding Mercy’s application. The administrative hearing was held on October 25, 2012.

Mercy’s administrative hearing request follows CON Board’s second rejection of Mercy’s proposed project.

As reported by McGuireWoods LLP in September 2012, Mercy sued the Board following its initial rejection of its principal application in December 2011. In the suit, Mercy claimed that the Board’s rejection of its application was “arbitrary and capricious” and contrary to Illinois law. The Board rejected Mercy’s request to build a hospital in Crystal Lake a second time in September 2012.

The Board’s rejection of Mercy’s certificate of need application prompted critics to again call into question the utility of the certificate of need process in Illinois. Such critics argued not only that the certificate of need process places an unwarranted financial burden on providers, but also that competition and market growth may be stifled.