Ex parte Sacred Heart Health System, Inc. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF CIVIL APPEALS (In re: Infirmary Health System and South Baldwin Regional Medical Center v. Sacred Heart Health System, Inc.)

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Rel: 11/21/2012 N o t i c e : This o p i n i o n i s s u b j e c t t o formal r e v i s i o n before p u b l i c a t i o n i n t h e advance s h e e t s o f Southern R e p o r t e r . R e a d e r s a r e r e q u e s t e d t o n o t i f y t h e R e p o r t e r o f D e c i s i o n s , Alabama A p p e l l a t e C o u r t s , 300 D e x t e r A v e n u e , M o n t g o m e r y , A l a b a m a 3 6 1 0 4 - 3 7 4 1 ((334) 2 2 9 - 0 6 4 9 ) , o f a n y t y p o g r a p h i c a l o r o t h e r e r r o r s , i n o r d e r t h a t c o r r e c t i o n s may b e made b e f o r e t h e o p i n i o n i s p r i n t e d i n Southern R e p o r t e r . SUPREME COURT OF ALABAMA OCTOBER TERM, 2012-2013 1091788 Ex p a r t e Sacred Heart H e a l t h System, Inc. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF CIVIL APPEALS (In r e : I n f i r m a r y H e a l t h System and South Baldwin M e d i c a l Center v. Sacred Heart H e a l t h System, I n c . ) (Montgomery C i r c u i t Court, CV-07-900905; Court o f C i v i l Appeals, 2090239) On A p p l i c a t i o n f o r Rehearing Regional 1091788 MAIN, Justice. The opinion of March following i s substituted Sacred defendant Health Heart 2, 2012, i s withdrawn, and the therefor. H e a l t h System, Inc. ("Sacred Heart"), i n a d e c l a r a t o r y - j u d g m e n t a c t i o n f i l e d by I n f i r m a r y System, Inc. ("IHS"), and South Baldwin Regional Medical Center ("South B a l d w i n " ) , a p p e a l e d t o t h i s C o u r t one a aspect Circuit the of Court from 1 final judgment i n f a v o r of IHS entered and South by the Montgomery Baldwin. IHS and South B a l d w i n c r o s s - a p p e a l e d from another a s p e c t of the trial court's Court judgment in favor of Sacred Heart. This t r a n s f e r r e d t h e a p p e a l and c r o s s - a p p e a l t o t h e C o u r t o f Civil A p p e a l s ; t h a t c o u r t r e v e r s e d the judgment of the t r i a l c o u r t . S a c r e d H e a r t H e a l t h S y s . , I n c . v. I n f i r m a r y H e a l t h S y s . , [Ms. 2090239, September 24, App. 2010). Sacred Heart 2010] then So. filed 3d (Ala. Civ. a petition r e v i e w w i t h t h i s C o u r t , w h i c h we g r a n t e d . We for now certiorari reverse and remand. I. F a c t s and Procedural History I t i s u n c l e a r f r o m t h e r e c o r d what t y p e o f e n t i t y Baldwin i s . 1 2 South 1091788 Sacred Heart corporation i s an o u t - o f - s t a t e , that provides charitable, nonprofit health-care services i n the panhandle o f F l o r i d a and i n s o u t h e r n B a l d w i n County. Heart also owns Sacred Heart Medical Group c o n s i s t i n g o f 143 m u l t i - s p e c i a l t y p h y s i c i a n s the area served by Sacred Heart. entity. with Sacred ("SHMG"), who p r a c t i c e i n SHMG i s n o t a s e p a r a t e legal A l l SHMG p h y s i c i a n s have u n i f o r m employment c o n t r a c t s SHMG; b i l l i n g f o r a l l patients i s consolidated and h a n d l e d b y SHMG e m p l o y e e s ; t h i r d - p a r t y p r o v i d e r s c o n s i d e r SHMG a medical g r o u p ; and i t s p h y s i c i a n s share t h e same billing number. Six SHMG p h y s i c i a n s p r a c t i c e i n s o u t h e r n B a l d w i n C o u n t y . When t h e i r expand practices their increased existing a n d i t was n o t f e a s i b l e t o offices, Sacred Heart executed a p r e c o n s t r u c t i o n c o n t r a c t w i t h C o l o n i a l P i n n a c l e MOB, L L C , t h e wholly owned subsidiary of Johnson developer and b u i l d e r o f medical Alabama "Johnson Heart's Development, LLC, a o f f i c e b u i l d i n g s throughout ( b o t h e n t i t i e s a r e h e r e i n a f t e r r e f e r r e d t o j o i n t l y as Development"). proposed constructed lease primarily The c o n t r a c t of a portion f o r medical 3 dealt with of a building purposes Sacred t o be (hereinafter 1091788 r e f e r r e d t o as " t h e m e d i c a l - b u i l d i n g p r o j e c t " ) . Sacred Heart has no o w n e r s h i p i n t e r e s t i n t h e m e d i c a l - b u i l d i n g the land on w h i c h the medical-building Johnson Development's i n i t i a l project called include an o u t p a t i e n t for a i s located. f o rthe medical-building f o r a 44,000-square-foot b u i l d i n g surgery SHMG p h y s i c i a n s , physicians, plans project center, time-share diagnostic that medical-office space center, project or would suites f o r u s e b y non-SHMG a laboratory, and a r e h a b i l i t a t i o n c e n t e r , a l l o f w h i c h w o u l d be l e a s e d t o v a r i o u s e n t i t i e s i n c l u d i n g Sacred Heart. Sacred Heart intends for the SHMG p h y s i c i a n s p r a c t i c i n g i n t h e m e d i c a l - b u i l d i n g p r o j e c t t o provide a family practice, diagnostic f a c i l i t i e s . oncologist to offer walk-in and l a b o r a t o r y and Sacred Heart a l s o plans services to include s c a n s who w o u l d have an o f f i c e the m e d i c a l - b u i l d i n g care, t o r e c r u i t an mammography a n d CT and d i a g n o s t i c facilities in project. T h r e e SHMG p h y s i c i a n s a l r e a d y u s e t h e l e a s e d s p a c e i n t h e medical-building project as t h e i r space f o r e i g h t p h y s i c i a n s . center was t o have b e e n Island Ambulatory office; The a r e a i n t e n d e d leased Surgery primary 4 for the surgery t o and o p e r a t e d by Center, there i s LLC, a group Pleasure o f non-SHMG 1091788 physicians. P l e a s u r e I s l a n d a p p l i e d f o r a c e r t i f i c a t e o f need ("CON") t o o p e r a t e Planning and application. opinion, State Development The C o u r t the decision. the surgery trial Pleasure Health center, Agency of C i v i l court's ("SHPDA") Appeals judgment I s l a n d Ambulatory Planning but the State & Dev. A g e n c y denied i t s affirmed, upholding Surgery Health without SHPDA's C t r . , LLC v. (No. 2080953, A p r i l 16, 2 0 1 0 ) , 82 So. 3 d 17 ( A l a . C i v . App. 2010) ( t a b l e ) . Therefore, the a medical-building center, nor w i l l initial plan will i t contain t o lease abandoned b e f o r e project not contain a rehabilitation space f o r a r e h a b i l i t a t i o n surgery center. The c e n t e r was Johnson Development c o m p l e t e d t h e m e d i c a l - building project. The portion leased contested i s s u e between t h e p a r t i e s i s whether t h e of the medical-building f o r i t s Baldwin County p h y s i c i a n s l e a s e d space") i s s u b j e c t t o Sacred CON f r o m SHPDA. 2 project Sacred Heart has t o u s e ("the SHMG Heart's S e c t i o n 22-21-260 e t s e q . , f i r s t obtaining a A l a . Code 1975, I n e x a m i n i n g t h e m e d i c a l - b u i l d i n g p r o j e c t as a w h o l e , t h i s C o u r t does n o t r e f e r t o t h e e n t i r e b u i l d i n g c o n s t r u c t e d by J o h n s o n D e v e l o p m e n t , w h i c h c o n t a i n s s p a c e f o r m e d i c a l a n d non-medical uses, b u t t o the p o r t i o n o f the b u i l d i n g l e a s e d by the s p e c i f i c physicians' p r a c t i c e seeking t o apply the p h y s i c i a n ' s o f f i c e e x e m p t i o n t o t h e CON r e q u i r e m e n t . In this 2 5 1091788 sets out the law concerning the r e g u l a t i o n of health-care facilities. Section person first 22-21-265, A l a . Code 1975, r e q u i r e s f u r n i s h i n g a "new i n s t i t u t i o n a l health t h a t any s e r v i c e " must o b t a i n a CON f r o m SHPDA: "(a) On o r a f t e r J u l y 3 0 , 1979, no p e r s o n t o which t h i s a r t i c l e a p p l i e s s h a l l acquire, construct, o r o p e r a t e a new i n s t i t u t i o n a l h e a l t h s e r v i c e , as defined i n this a r t i c l e , or furnish or offer, or purport t o f u r n i s h a new i n s t i t u t i o n a l health s e r v i c e , as d e f i n e d i n t h i s a r t i c l e , o r make an a r r a n g e m e n t o r commitment f o r f i n a n c i n g t h e o f f e r i n g o f a new i n s t i t u t i o n a l h e a l t h s e r v i c e , u n l e s s t h e person shall first obtain from t h e SHPDA a c e r t i f i c a t e o f n e e d t h e r e f o r . ... " Section 22-21-263, Ala. Code 1975, prohibits institutional health services that are inconsistent with the "State Health Plan": 3 "(a) A l l new i n s t i t u t i o n a l h e a l t h s e r v i c e s w h i c h are s u b j e c t t o t h i s a r t i c l e and which a r e proposed t o be o f f e r e d o r d e v e l o p e d w i t h i n t h e s t a t e s h a l l be subject t o review under this article. No i n s t i t u t i o n a l h e a l t h s e r v i c e s which are subject t o this article shall be permitted which a r e inconsistent with the State Health Plan. For the c a s e , we r e v i e w t h e SHMG l e a s e d s p a c e b e c a u s e t h a t i s t h e o n l y s p a c e t o be u s e d b y t h e SHMG p r a c t i c e . The " S t a t e H e a l t h P l a n " i s d e f i n e d a t § 22-21-260(13), A l a . Code 1975, as " [ a ] c o m p r e h e n s i v e p l a n w h i c h i s p r e p a r e d t r i e n n i a l l y a n d r e v i e w e d a t l e a s t a n n u a l l y a n d r e v i s e d as necessary " 3 6 1091788 p u r p o s e s o f t h i s a r t i c l e , new i n s t i t u t i o n a l h e a l t h s e r v i c e s s h a l l i n c l u d e any o f t h e f o l l o w i n g : " ( 1 ) The c o n s t r u c t i o n , d e v e l o p m e n t , a c q u i s i t i o n through lease or purchase, or other establishment o f a new h e a l t h c a r e facility or health maintenance organization." The t e r m " i n s t i t u t i o n a l h e a l t h s e r v i c e s " i s d e f i n e d a t § 2 2 - 2 1 - 2 6 0 ( 9 ) , A l a . Code 1975, as " [ h ] e a l t h s e r v i c e s in or through health care facilities or health provided maintenance o r g a n i z a t i o n s , i n c l u d i n g the e n t i t i e s i n or through which such services are The 1975, provided." emphasized language in § 22-21-260(8), defining "health services," provides physician's A l a . Code an e x e m p t i o n f o r a practice: "(8) H e a l t h s e r v i c e s . C l i n i c a l l y r e l a t e d ( i . e . , d i a g n o s t i c , c u r a t i v e , or r e h a b i l i t a t i v e ) s e r v i c e s , i n c l u d i n g a l c o h o l , d r u g abuse, and m e n t a l h e a l t h services customarily furnished on either an i n - p a t i e n t or o u t - p a t i e n t b a s i s by h e a l t h care f a c i l i t i e s , but not i n c l u d i n g the l a w f u l p r a c t i c e of any p r o f e s s i o n o r v o c a t i o n c o n d u c t e d i n d e p e n d e n t l y of a h e a l t h care f a c i l i t y and i n a c c o r d a n c e w i t h a p p l i c a b l e l i c e n s i n g laws of t h i s s t a t e . " (Emphasis added.) Section care 22-21-2 6 0 ( 6 ) , facility" A l a . Code 1975, d e f i n e s as f o l l o w s : 7 a "health 1091788 "(6) Health care facility. General and specialized hospitals, including tuberculosis, p s y c h i a t r i c , l o n g - t e r m c a r e , and o t h e r t y p e s o f hospitals, and related facilities such as, laboratories, out-patient clinics, and c e n t r a l service facilities operated i n connection with h o s p i t a l s ; s k i l l e d nursing f a c i l i t i e s ; intermediate care f a c i l i t i e s ; s k i l l e d or i n t e r m e d i a t e care u n i t s o p e r a t e d i n v e t e r a n s ' n u r s i n g homes a n d v e t e r a n s ' homes ... ; r e h a b i l i t a t i o n c e n t e r s ; p u b l i c h e a l t h centers; facilities f o r s u r g i c a l treatment of patients not r e q u i r i n g h o s p i t a l i z a t i o n ; kidney disease treatment centers ... ; community m e n t a l h e a l t h c e n t e r s and r e l a t e d f a c i l i t i e s ; a l c o h o l and drug abuse facilities; facilities f o r the developmentally d i s a b l e d ; hospice service p r o v i d e r s ; and home h e a l t h a g e n c i e s a n d h e a l t h m a i n t e n a n c e organizations. The t e r m h e a l t h c a r e f a c i l i t y s h a l l not i n c l u d e t h e o f f i c e s o f p r i v a t e p h y s i c i a n s o r d e n t i s t s , whether f o r i n d i v i d u a l o r group p r a c t i c e s and r e g a r d l e s s o f o w n e r s h i p .." (Emphasis added.) The l a n g u a g e e m p h a s i z e d above i s r e f e r r e d t o as t h e p h y s i c i a n ' s After o f f i c e exemption Sacred Heart contracted ("the P O E " ) . to lease a portion of the m e d i c a l - b u i l d i n g p r o j e c t , South B a l d w i n f i l e d a p e t i t i o n SHPDA i n w h i c h i t requested that SHPDA d e c l a r e that Heart's plans t o develop the m e d i c a l - b u i l d i n g p r o j e c t t h a t S a c r e d H e a r t o b t a i n a CON f r o m SHPDA. support of South Baldwin's p e t i t i o n . judge assigned not have with Sacred required IHS i n t e r v e n e d i n The a d m i n i s t r a t i v e l a w t o h e a r t h e p e t i t i o n d e t e r m i n e d t h a t SHPDA d i d jurisdiction and remanded 8 the p e t i t i o n to the 1091788 Certificate petition o f Need R e v i e w Board was n o t r u l e d on w i t h i n deemed d e n i e d ("the CONRB"). 45 d a y s , When t h e the petition p u r s u a n t t o § 41-22-11, A l a . Code 1975. B a l d w i n and IHS then f i l e d a petition t h e Montgomery C i r c u i t C o u r t . for j u d i c i a l summary- judgment motions f i l e d by the p a r t i e s and c o n s i d e r e d t h a t t h e SHMG l e a s e d s p a c e q u a l i f i e d § 2 2 - 2 1 - 2 6 0 ( 6 ) , A l a . Code 1975, leased space review. The facility court held r e q u i r i n g CON a postjudgment amended i t s j u d g m e n t t o h o l d l e a s e d space q u a l i f i e d case a n d , t h e r e f o r e , t h a t t h e SHMG was n o t a h e a l t h - c a r e court the f o r t h e POE a v a i l a b l e i n South B a l d w i n and IHS f i l e d trial The t r i a l South review i n The t r i a l c o u r t d e n i e d on a j o i n t s u b m i s s i o n o f t h e e v i d e n c e . was that motion. t h e SHMG f o r t h e POE o n l y as t o t h e t h r e e p h y s i c i a n s who h a d r e l o c a t e d t o t h e m e d i c a l - b u i l d i n g from t h e i r south B a l d w i n County o f f i c e s . SHMG project The t r i a l c o u r t also held that adding a d d i t i o n a l physicians or p r o v i d i n g a d d i t i o n a l s e r v i c e s i n the m e d i c a l - b u i l d i n g p r o j e c t would r e q u i r e Sacred H e a r t t o o b t a i n a CON. On appeal, court's judgment the Court of C i v i l Appeals reversed judgment a n d remanded declaring that t h e case " t h e MOB 9 the trial f o rthe entry of a [medical-office-building] 1091788 project, and as d e v e l o p e d a w h o l e , " does n o t q u a l i f y requires Civil CON Appeals Heart from review. So. 4 3d a t . f o r the The Court a l s o d i r e c t e d the t r i a l c o u r t to e n j o i n offering building project until health-care services i t secures a in the POE of Sacred medical- CON. Sacred Heart f i l e d a p e t i t i o n f o r a w r i t of c e r t i o r a r i to t h i s C o u r t and a s s e r t e d as a g r o u n d f o r review that t h i s case presents the f o l l o w i n g m a t e r i a l q u e s t i o n of f i r s t i m p r e s s i o n : Whether the SHMG l e a s e d s p a c e and the health-care services p r o p o s e d by S a c r e d H e a r t t o be o f f e r e d t h e r e i n q u a l i f y f o r t h e POE so t h a t S a c r e d H e a r t i s n o t r e q u i r e d t o s e c u r e a II. CON. Standard of Review "Our s t a n d a r d o f r e v i e w o f t h i s c a s e i s g o v e r n e d by s t a t u t e . S e c t i o n 1 2 - 2 - 7 ( 1 ) , A l a . Code 1975, states: " ' [ I ] n d e c i d i n g a p p e a l s , no w e i g h t s h a l l be g i v e n t h e d e c i s i o n o f t h e t r i a l j u d g e upon t h e f a c t s where t h e e v i d e n c e i s n o t t a k e n o r a l l y b e f o r e the judge, but i n such cases t h e Supreme C o u r t s h a l l w e i g h t h e e v i d e n c e and g i v e j u d g m e n t as i t deems j u s t . ' " I n a c a s e i n w h i c h a t r i a l c o u r t has n o t h e a r d l i v e t e s t i m o n y , t h i s C o u r t has h e l d t h a t ' a r e v i e w i n g c o u r t w i l l not a p p l y the presumption of c o r r e c t n e s s The C o u r t o f C i v i l A p p e a l s ' o p i n i o n was a u t h o r e d by J u d g e Thomas. P r e s i d i n g J u d g e Thompson and J u d g e B r y a n c o n c u r r e d i n t h e r e s u l t ; J u d g e P i t t m a n and J u d g e Moore d i s s e n t e d . 4 10 1091788 t o a t r i a l c o u r t ' s f i n d i n g s o f f a c t and t h a t t h e r e v i e w i n g c o u r t w i l l r e v i e w t h e e v i d e n c e de n o v o . ' E u b a n k s v. H a l e , 752 So. 2d 1113, 1122 ( A l a . 1999). Our s t a t u t o r y o b l i g a t i o n i n a c a s e s u c h as t h i s i s t o 'weigh t h e e v i d e n c e and g i v e j u d g m e n t as [we] deem[] j u s t . ' " Bentley (Ala. Sys., I n c . v. 2005). Intergraph M o r e o v e r , we C o r p . , 922 a l s o r e v i e w de law involving statutory construction. 959 So. 2d 69, 70 provider obtain new 22-21-265, of any a CON 2d 61, novo a q u e s t i o n W h i t e h u r s t v. new Ala. "institutional Code 1975, institutional f r o m SHPDA. facility." terms "health include By health As requires health services" exemptions for do not profession or service," laws." § include "the and t o be the that "the conducted accordance 22-21-260(8). offices "health of care A "health private 11 facility" applicable care facility" physicians or the the both "Health practice of a "health statutes, independently with first of practice. lawful the considered provider applicable physician's include in i n the and a vocation facility Baker, s e r v i c e must definition, defined services" care of Analysis s e r v i c e must o f f e r " h e a l t h s e r v i c e s " i n o r t h r o u g h a care 70-71 ( A l a . 2006). III. Section So. of a any health licensing does not dentists, 1091788 whether for individual ownership." § contained f o r a physician's p r a c t i c e contained of health services i n the d e f i n i t i o n exempts a p h y s i c i a n ' s long as whose o f f i c e s a r e engaged profession, than i n the t h e POE facility. It of h i s or her profession independently I f o u r i n q u i r y were l i m i t e d physicians project i s broader of a health-care practice i t i s conducted facility. p r a c t i c e s and r e g a r d l e s s o f 22-21-260(6). The e x e m p t i o n definition o r group of a so health-care t o whether t h e SHMG are located i n the medical-building i n the t h e exemption lawful practice i n the d e f i n i t i o n services" i n § 22-21-260(8) would excuse obtaining a CON f o r t h e SHMG l e a s e d of of their "health Sacred Heart space. from However, t h e exemption i n § 22-21-260(8) a l s o r e q u i r e s t h a t the p r a c t i c e o f the profession at issue health care f a c i l i t y , " POE i n the d e f i n i t i o n 260(6) ownership," or in "independently of a s o we must a l s o d e t e r m i n e w h e t h e r t h e of "health f o r the "offices individually be c o n d u c t e d a of group care f a c i l i t y " private 12 physicians" practice, a p p l i e s t o t h e SHMG l e a s e d i n § 22-21- space. either "regardless of 1091788 Our statutory inquiry i s governed by settled principles of construction. "When i n t e r p r e t i n g a s t a t u t e , a c o u r t must f i r s t g i v e e f f e c t t o t h e i n t e n t o f t h e l e g i s l a t u r e . BP E x p l o r a t i o n & O i l , I n c . v . H o p k i n s , 678 So. 2d 1052 (Ala. 1996). "'The f u n d a m e n t a l r u l e o f s t a t u t o r y construction i s that t h i s Court i s t o a s c e r t a i n and e f f e c t u a t e t h e l e g i s l a t i v e i n t e n t as e x p r e s s e d i n t h e s t a t u t e . League o f Women V o t e r s v . R e n f r o , 292 A l a . 128, 290 So. 2 d 167 (1974). In t h i s a s c e r t a i n m e n t , we must l o o k t o t h e e n t i r e Act instead of i s o l a t e d phrases or clauses; O p i n i o n o f t h e J u s t i c e s , 264 A l a . 176, 85 So. 2 d 391 ( 1 9 5 6 ) . ' " D a r k s D a i r y , I n c . v . A l a b a m a D a i r y Comm'n, 367 So. 2d 1378, 1380 ( A l a . 1979) ( e m p h a s i s a d d e d ) . To d i s c e r n t h e l e g i s l a t i v e i n t e n t , t h e C o u r t must f i r s t look t o t h e language o f t h e s t a t u t e . I f , giving the s t a t u t o r y language i t s p l a i n and o r d i n a r y meaning, we c o n c l u d e t h a t t h e l a n g u a g e i s u n a m b i g u o u s , t h e r e i s no room f o r j u d i c i a l c o n s t r u c t i o n . Ex p a r t e W a d d a i l , 827 So. 2 d 789, 794 ( A l a . 2001) . Ifa l i t e r a l c o n s t r u c t i o n w o u l d p r o d u c e an a b s u r d a n d unjust r e s u l t that i s c l e a r l y inconsistent with the purpose and p o l i c y of the statute, such a c o n s t r u c t i o n i s t o be a v o i d e d . Ex p a r t e Meeks, 682 So. 2 d 423 ( A l a . 1 9 9 6 ) . " City o f Bessemer v. M c C l a i n , 2006). [the] and "When a c o u r t statute commonly 957 So. 2d 1061, 1074-75 ( A l a . construes a statute, must be g i v e n their natural, '[w]ords used i n plain, ordinary, u n d e r s t o o d m e a n i n g , a n d where p l a i n l a n g u a g e i s 13 1091788 used a court i s bound to interpret that e x a c t l y what i t s a y s . ' " (Ala. 2001) Corp. , 602 (quoting So. 2d language Ex p a r t e B e r r y h i l l , IMED 344, Corp. 346 v. t o mean 801 So. 2d 7, 10 S y s t e m s Eng'g ( A l a . 1992)). Assocs. As we have r e p e a t e d l y s t a t e d , t h e f u n c t i o n o f t h i s C o u r t i s " ' t o s a y what the l a w i s , n o t t o s a y what i t should A c h e n b a c h , 783 So. 2d 4, 7 ( A l a . 2000) LP be.'" Ex parte ( q u o t i n g DeKalb Cnty. Gas Co. v. S u b u r b a n Gas, I n c . , 729 So. 2d 270, 276 (Ala. 1998)). " ' " ' I t i s s e t t l e d that courts should give great weight t o any r e a s o n a b l e c o n s t r u c t i o n o f a r e g u l a t o r y s t a t u t e a d o p t e d by the agency charged w i t h t h e enforcement o f t h a t s t a t u t e . ' " ' " QCC, I n c . v. H a l l , 757 So. 2d 1115, 1119 ( A l a . 2000) NationsBank of North (quoting C a r o l i n a , N.A. v. V a r i a b l e A n n u i t y I n s . Co., 513 U.S. 2 5 1 , 256 ( 1 9 9 5 ) , quoting i n t u r n C l a r k e v. S e c u r i t i e s I n d u s . A s s ' n , 479 U.S. 388 ( 1 9 8 7 ) , quoting i n turn I n v e s t m e n t Co. I n s t i t u t e v. Camp, 479 U.S. 388 ( 1 9 7 1 ) ) . CONRB has formulated a four-part test that i t uses d e t e r m i n e w h e t h e r t h e POE i s a p p l i c a b l e i n a g i v e n The t e s t was f i r s t Heart-Lung Life The to situation. s t a t e d i n CONRB A d m i n i s t r a t i v e R u l i n g Re: Associates of America, 14 P.C., DR-100 ( A u g u s t 29, 1091788 2 0 0 1 ) , a t p . 3 , 5 1 1 , n.3, a n d r e s t a t e d i n CONRB A d m i n i s t r a t i v e Ruling Re: E a s t Alabama Medical Cardiovascular 110 Alabama Center Health v. Care Authority Institute d/b/a E a s t for Advanced C a r e & Community M e d i c a l D e v e l o p m e n t , L L C , DR- (May 3, 2 0 0 7 ) , a t p.5 ("the H e a r t - L u n g t e s t " ) . Heart-Lung t e s t , Under t h e t h e POE i s a p p l i c a b l e when i t i s shown: "1. That the proposed services a r e t o be p r o v i d e d , and r e l a t e d equipment used, e x c l u s i v e l y by t h e p h y s i c i a n s i d e n t i f i e d as owners o r e m p l o y e e s o f the p h y s i c i a n s ' p r a c t i c e f o r t h e care o f t h e i r patients. "2. T h a t the proposed services a r e t o be p r o v i d e d , and r e l a t e d equipment used, a t t h e p r i m a r y o f f i c e o f such p h y s i c i a n s . "3. T h a t a l l p a t i e n t b i l l i n g s r e l a t e d t o s u c h s e r v i c e s a r e t h r o u g h , o r e x p r e s s l y on b e h a l f o f , t h e p h y s i c i a n s ' p r a c t i c e , a n d n o t on b e h a l f o f a t h i r d party. "4. T h a t t h e e q u i p m e n t s h a l l n o t be u s e d f o r i n p a t i e n t c a r e , n o r b y , t h r o u g h o r on b e h a l f o f a health care f a c i l i t y . " Sacred Heart Court of C i v i l space qualifies unworkable argues that the standard applied Appeals t o determine whether by t h e t h e SHMG leased f o r t h e POE i s a r b i t r a r y , s u b j e c t i v e , a n d and t h a t that court erred when i t h e l d second f a c t o r o f t h e H e a r t - L u n g t e s t h a d n o t been that the satisfied. S a c r e d H e a r t f u r t h e r a r g u e s t h a t t h e i n j u n c t i o n d i r e c t e d t o be 15 1091788 i s s u e d by t h e C o u r t o f C i v i l that court's a p p l i c a t i o n of a subjective that t h i s Court should of Civil "the Appeals point referred beyond office," that t h e POE d i d n o t a p p l y i n DR-116, 'where common sense definition of a t o review.'" "physician's So. 3d a t and m a i n t a i n s that Sacred i tshould Heart also . does n o t p r o v i d e t h e c l a r i t y or s p e c i f i c i t y necessary for predictable test. an o u t ¬ e v e n one d e v e l o p e d a n d owned b y p h y s i c i a n s , and i s s u b j e c t Heart-Lung because r e a c h e s i n o u r minds t h e Sacred Heart contends t h a t t h i s standard planning test [ m e d i c a l - o f f i c e - b u i l d i n g ] p r o j e c t , as t o b y t h e CONRB a and a r b i t r a r y The m a i n o p i n i o n o f t h e C o u r t d e s i g n e d and developed, patient f a c i l i t y , goes reject. stated s c o p e o f t h e MOB originally A p p e a l s was b a s e d p r i m a r i l y on health-care be r e p l a c e d argues that with the a l l four f a c t o r s o f t h e H e a r t - L u n g t e s t a r e met a n d t h a t t h e r e f o r e t h e POE i s a p p l i c a b l e t o t h e SHMG l e a s e d IHS space. and South B a l d w i n argue n o t o n l y that the statutory r e q u i r e m e n t f o r CON r e v i e w a p p l i e s t o t h e o p e r a t i o n health-care facility, but also prohibits developing, acquiring, financing for institutional that 16 the statutory constructing, health o f a new services scheme or obtaining without first 1091788 obtaining a CON. See § 22-21-2 6 3 ( a ) , A l a . Code 1975. IHS a r g u e s i n i t s b r i e f t h a t , a c c o r d i n g t o § 22-21-2 6 3 ( a ) , " S a c r e d H e a r t was o b l i g a t e d t o o b t a i n a CON p r i o r t o , a n d i n o r d e r t o , engage i n t h e c o n s t r u c t i o n , health care f a c i l i t y . " development IHS's b r i e f , o r l e a s e o f t h e new a t 27. IHS m a i n t a i n s that Sacred Heart "executed leases f o r f a c i l i t i e s a 'health care f a c i l i t y ' IHS's b r i e f , a t 28. f o r w h i c h CON comprising review i s required." South B a l d w i n argues i n i t s brief that " S a c r e d H e a r t , w i t h i t s t h r e e h o s p i t a l s and v a r i o u s o u t p a t i e n t c l i n i c s a l l o p e r a t i n g as a s i n g l e l e g a l e n t i t y , u n q u e s t i o n a b l y qualifies as a 'health test]." South care f a c i l i t y ' Baldwin's brief, a t 28. Baldwin argues, Sacred Heart cannot CON under [the Heart-Lung Therefore, "exempt i t s e l f statute simply by South from the restrictions of the employing physicians." Id. SHPDA a d o p t e d t h e H e a r t - L u n g t e s t , IHS a n d S o u t h B a l d w i n s a y , t o a n a l y z e w h e t h e r a p r o j e c t i s d e s i g n e d as the o f f i c e s of p r i v a t e p h y s i c i a n s or i s a health-care s u b j e c t t o CON r e v i e w . SHMG leased because also space i t was because IHS a n d S o u t h B a l d w i n c o n t e n d t h a t t h e triggered t h e CON d e s i g n e d as a new Sacred facility Heart health-care proposed 17 requirement new not only facility, but services at the 1091788 f a c i l i t y t h a t i n d e p e n d e n t l y r e q u i r e CON r e v i e w . IHS a n d S o u t h B a l d w i n a r g u e t h a t t h e SHMG l e a s e d s p a c e does n o t meet a l l t h e criteria t o q u a l i f y f o r t h e POE a n d t h a t , H e a r t must o b t a i n a CON b e f o r e therefore, Sacred i t c a n u s e t h e SHMG leased space. This C o u r t has r e v i e w e d the Heart-Lung t e s t and g i v e n i t great weight, has c o n s i d e r e d the problems w i t h the a p p l i c a t i o n o f t h e t e s t t h a t have a r i s e n i n t h i s c a s e , a n d h a s g i v e n t h e words i n t h e POE " t h e i r n a t u r a l , p l a i n , o r d i n a r y , a n d commonly understood meaning." IMED C o r p . , 602 So. 2d a t 346. We conclude t h a t t h e Heart-Lung t e s t i s s u b s t a n t i a l l y sound b u t that i t should and be m o d i f i e d t o be c o n s i s t e n t w i t h p o l i c y o f t h e POE a n d t o r e f l e c t expressed i n § 22-21-260(6). part test 5 t h e purpose the l e g i s l a t i v e We h e r e b y a d o p t a m o d i f i e d intent four- t o be u s e d t o d e t e r m i n e w h e t h e r a p r o p o s e d m e d i c a l We have c h a n g e d t h e p h r a s e " t h e p r i m a r y o f f i c e " t o "any o f f i c e " i n t h e s e c o n d p a r t o f t h e t e s t a n d have s t r u c k t h e p h r a s e " a n d n o t on b e h a l f o f a t h i r d p a r t y " i n t h e t h i r d p a r t because o f a p o t e n t i a l c o n f l i c t w i t h phrase " r e g a r d l e s s o f o w n e r s h i p " i n t h e s t a t u t o r y l a n g u a g e o f t h e POE. E x p a r t e McLeod, 718 So. 2d 682, 690 ( A l a . 1997) ("An a d m i n i s t r a t i v e agency's i n t e r p r e t a t i o n o f a s t a t u t e w i l l n o t be g i v e n d e f e r e n c e i f i t i s c o n t r a r y t o t h e l e g i s l a t i v e i n t e n t . " ) . See a l s o Ex p a r t e C r e s t w o o d Hosp. & N u r s i n g Home, I n c . , 670 So. 2d 45, 47 ( A l a . 1995) ( " I t i s s e t t l e d l a w t h a t t h e p r o v i s i o n s o f a s t a t u t e w i l l p r e v a i l i n any case i n which t h e r e i s a c o n f l i c t between the s t a t u t e and a s t a t e agency r e g u l a t i o n . " ) . 5 18 1091788 facility or project r e f e r r e d t o as "the qualifies POE for application the POE (hereinafter test"): (1) The p r o p o s e d s e r v i c e s a r e t o be provided, and r e l a t e d e q u i p m e n t u s e d , e x c l u s i v e l y by the p h y s i c i a n s i d e n t i f i e d as owners o r e m p l o y e e s o f t h e p h y s i c i a n s ' p r a c t i c e f o r the care of t h e i r p a t i e n t s . (2) The p r o p o s e d s e r v i c e s a r e t o be provided, and r e l a t e d e q u i p m e n t u s e d , a t any o f f i c e o f s u c h physicians. (3) A l l patient billings related to such s e r v i c e s a r e t h r o u g h , o r e x p r e s s l y on b e h a l f o f , t h e physicians' practice. (4) The equipment shall not be used for i n p a t i e n t c a r e , n o r by, t h r o u g h , o r on b e h a l f o f a health-care facility. The POE application test is promulgated c l a r i f i c a t i o n as t o t h e e x e m p t i o n f r o m t h e CON for the o f f i c e s of p r a c t i c e s and statutory 263, and licensed physicians, s h o u l d not language be i n §§ objective 6 6 The POE standard that See supra note or 22-21-260(8), otherwise or can be 3. 19 test will the 22-21¬ applicable r e g u l a t i o n s p u r s u a n t t o the application group circumventing Code 1975, 22-21-265, A l a . Plan." review process dentists, i n t e r p r e t e d as provide 22-21-260(6), s t a t u t e s or a d m i n i s t r a t i v e Health to "State provide an used to determine whether the 1091788 POE a p p l i e s t o any m e d i c a l p r a c t i c e , whether t h e p r a c t i c e i s s o l o o r group, l a r g e o r s m a l l , s p e c i a l i z e d o r g e n e r a l . an objective test w i l l not only provide direction Such t o SHPDA, t h e CONRB, a n d o u r c o u r t s , b u t w i l l a l s o p r o v i d e t h e c e r t a i n t y needed by d e v e l o p e r s and of medical o f f i c e b u i l d i n g s i n t h i s i t s p h y s i c i a n s a t times when, f o r e x a m p l e , t h e y State consider r e l o c a t i n g a p r a c t i c e , a d d i n g a new p h y s i c i a n o r s p e c i a l t y t o an e x i s t i n g p r a c t i c e , p u r c h a s i n g a p i e c e o f new e q u i p m e n t , o r o f f e r i n g a new s e r v i c e . As t o t h e SHMG l e a s e d s p a c e , t h e t r i a l c o u r t d i d n o t have b e f o r e i t t h e POE a p p l i c a t i o n t e s t we a d o p t t o d a y ; t h e r e f o r e , we remand t h i s case t o t h e Court o f C i v i l remand t h e c a s e t o t h e t r i a l Appeals f o r i t t o court for consideration i n l i g h t o f t h e POE a p p l i c a t i o n t e s t , i n c l u d i n g a n y f u r t h e r the t r i a l POE c o u r t deems n e c e s s a r y . application test proceedings B e c a u s e we t o d a y a d o p t t h e a n d remand t h e case, we pretermit c o n s i d e r a t i o n o f t h e o t h e r a r g u m e n t s made b y t h e p a r t i e s . IV. Conclusion We r e v e r s e t h e j u d g m e n t o f t h e C o u r t o f C i v i l A p p e a l s a n d remand t h i s case f o rthat court t o remand t h e c a s e t r i a l c o u r t f o r any f u r t h e r p r o c e e d i n g s for the t r i a l court t o apply to the i t deems n e c e s s a r y a n d t h e POE a p p l i c a t i o n t e s t t o t h e SHMG l e a s e d s p a c e i n t h e m e d i c a l - b u i l d i n g p r o j e c t i n a manner consistent with this opinion. 20 1091788 APPLICATION GRANTED; OPINION OF M^ARCH 2, 2012, WITHDRAWN; OPINION SUBSTITUTED; REVERSED AND REMANDED WITH INSTRUCTIONS. Malone, C.J., and Woodall, Stuart, Bolin, P a r k e r , * and Murdock, J J . , c o n c u r . Shaw, J . , c o n c u r s i n the result. Wise, J . , recuses herself. * A l t h o u g h J u s t i c e P a r k e r was n o t p r e s e n t a t o r a l argument i n t h i s c a s e , he h a s l i s t e n e d t o t h e a u d i o t a p e o f t h e o r a l argument. 21

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