Four Steps to a Successful Michigan Certificate of Need (CON) Application

Whether you’re launching a new healthcare service, acquiring a facility, or expanding operations, navigating Michigan’s Certificate of Need (CON) process is a critical step. At Mooradian Law, we’ve helped providers across the state move through this complex regulatory landscape with clarity and confidence.

From initial planning to post-approval implementation, understanding how to position your project for success can save time, reduce risk, and prevent costly delays. Based on our experience and insights from Michigan Department of Health and Human Services (MDHHS) data, we’ve outlined four essential steps to a smooth and successful CON strategy.

For an overview of Michigan’s CON requirements, check out our introductory post.

Step 1: Understand the Review Process and Timeline

Michigan’s CON review process includes three types of reviews—nonsubstantive, substantive, and comparative—each with distinct procedures and review periods. Identifying which category your project falls into at the outset is crucial to building a realistic timeline.

Know Your Review Type:

Nonsubstantive Review: 45-day review period; the full process typically takes 2–4 months.
Substantive Review: 120-day review period; the total process generally spans 4–6 months.
Comparative Review: Applications accepted only three times per year (first working day of February, June, and October). If a comparative review and appeal are required, the process may take over a year.

Keys to Success:

Map your project timeline from Letter of Intent (LOI) through final decision—not just the formal review period.
Confirm your review category early to avoid underestimating prep time or missing strategic filing windows.
For comparative projects, stand out by:
- Aligning with community health needs.
- Building stakeholder support early.
- Addressing competitor objections within your application.

Step 2: Build a Financially Resilient Project Budget

Accurate budgeting for your project is more than just good business—it’s essential for compliance with Michigan CON requirements. Cost underestimation can trigger the need for a CON amendment, delaying the project and increasing scrutiny from regulators.

Keys to Success:

Conduct financial feasibility analyses that account for labor trends, construction costs, inflation, and regulatory shifts.
Budget conservatively to accommodate potential price escalations or supply chain disruptions.
Engage experienced professionals (construction managers, compliance advisors, and financial consultants) to validate projections and test your assumptions.

Step 3: Evaluate Leases and Contracts for CON Implications

CON approval is required before entering into lease agreements that exceed Michigan’s capital expenditure threshold—$4,175,000 in 2025 (indexed annually). This includes both new leases and amendments that increase total rent obligations.

CON Approval Is Required Prior To:

Signing a lease for a licensed health facility if the total rent (including renewals) exceeds the threshold.
Renewing or amending a lease if the rent increase surpasses what was previously CON-approved or exceeds the current threshold.

Keys to Success:

Have legal counsel review all leases, renewals, and amendments for CON implications before signing.
Document total lease obligations clearly to support your CON application.
Act early—obtaining retroactive approval is not guaranteed and may result in corrective action plans or civil penalties.

Step 4: Stick to Post-Approval Milestones

Once your CON application is approved, implementation deadlines begin. Missing these benchmarks can result in automatic expiration of your CON approval.

Required Milestones:

Within 12 Months: Either begin implementing the project or execute a binding agreement (e.g., a construction contract).
Within 24 Months: Start physical construction—typically marked by pouring footings.

Keys to Success:

Plan backward from these deadlines when preparing your application.
Track all conditions of approval, including milestone dates, in a centralized compliance calendar.
Assign accountability—either internally or via outside counsel—to monitor deadlines and ensure timely execution.

Final Thoughts: Set Your Project Up for Success

Michigan’s CON process doesn’t need to be an obstacle—it can be a strategic advantage when approached proactively. By identifying the right review pathway, building a sound financial and legal foundation, and staying ahead of compliance deadlines, your project will be well-positioned for approval and long-term success.

At Mooradian Law, we help healthcare providers navigate Michigan’s CON process efficiently and effectively. Our strategic approach ensures your project is positioned for success from the initial concept through full compliance.

C ontact Us to Talk About Your Project

Email: info@mooradian.law

Phone: (734) 219-4890

About the Authors

Serj Mooradian is a healthcare attorney and founder of Mooradian Law. With more than a decade of experience at top national firms, Serj advises healthcare clients on regulatory strategy and transactions involving Stark Law, Anti-Kickback Statute, HIPAA, and CON compliance.

Hannah Zaskiewicz is a healthcare attorney with a focus on healthcare regulatory and transactional matters. She is widely recognized as one of Michigan’s top Certificate of Need advisors, helping providers navigate the application process with strategic insight and exceptional client service.

Seyed Mirabedini leads the firm’s digital strategy. He translates complex regulatory topics into digestible content to help clients make informed, strategic decisions.