I’m surprised to see no mention of Certificates of Need: https://en.wikipedia.org/wiki/Certificate_of_need. In most of the US hospitals need to have a license for their number of beds, the idea being that regulators don’t want there to be too many beds because hospitals tend to find ways to fill them unnecessarily. I’m not familiar with the literature about how good of an argument that is. Intuitively you can see how that could be an impediment when there is a greater need for hospital beds.
That's the idea. In reality other hospitals in the area get to have a significant say in new facilities to ensure that they are not either operating empty beds (non-maximal revenue) or filling them with delayed discharges.
Remember that hospitals and hospital owners lobbied the Nixon administration heavily to get this process put into law, and it becomes a bit clearer.
