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MSC: Original jurisdiction over CONs unconstitutional

A disagreement over a dialysis facility in North Mississippi ended up killing a law designed to streamline the certificate of need appeals process.

The Mississippi Supreme Court ruled June 21 that a 2011 law that provided for a direct appeal to that court in CON cases was unconstitutional. The ruling was in response to a CON dispute over a proposed healthcare facility.

Dialysis Solutions applied for a CON in October 2007 for a $179,000 end-stage renal dialysis facility in Montgomery County. The Mississippi State Department of Health denied the CON a month later, saying the facility did not comply with the criteria and standards for end-stage renal facilities set out in the 2007 Health Plan. (The MSDH, by law, developed a state health plan every three years.)

University of Mississippi Medical Center

After a round of public hearings, state Health Officer Mary Currier filed notice that she intended to deny the CON again. Currier’s decision of intent was filed June 30, 2011, one day before the direct appeal law took effect.

Dialysis Solutions appealed Currier’s decision to the state high court almost immediately. Shortly after, justices ordered briefing from the parties involved and from Attorney General Jim Hood on whether the new law was constitutional.

Justice Michael Randolph, writing for the majority, noted in the opinion that precedent says that the supreme court cannot substitute its judgment in place of a legislature’s and a governor’s “unless it appears beyond all reasonable doubt” that the law in question is unconstitutional.

In the CON law direct appeal case, the court found that the resolution of a CON is not necessarily adversarial, holding that a CON is essentially a permit to provide healthcare services, whose process is overseen by a hearing officer who generally acts on behalf of MSDH, not as a neutral arbiter. The court also said that the MSDH, even though it makes factual determinations during the CON process, is not a tribunal with judicial power so the supreme court, under the direct appeal law, would have original jurisdiction over a CON, which violates the Constitution. There is one exception to that. The Mississippi Constitution allows the supreme court to have original jurisdiction in cases involving public utilities and the rates they seek to charge ratepayers.

The court’s CON appeal ruling said that the high court could hear direct appeals involving CONs that arise out of chancery court.

Rep. Steve Holland, D-Plantersville and former chairman of the House Public Health and Human Services Committee, wrote the 2011 direct appeal that eventually cleared both chambers unanimously before becoming law.

Holland said in an interview last week that the intent of the law had nothing to do with usurping power from a trial court (in this case, a chancery court) and everything to do with shortening the CON appeals schedule.

“The process was being drug out too long,” Holland said. “It was too laborious and too costly. The people who had the money to sue, which is all the big boys, just sued each other and held it up in court forever and ever.

It was ultimately going to the Supreme Court anyway. All of them do. So why not just take it straight there? Either that or put a time limit on the appeals process. Somehow the process needed to be expedited, made a little less expensive and a little less litigious, and that was the law’s intent.”

Holland, who was unaware of the court’s ruling until a reporter told him, said any constitutional concerns he had during the 2011 legislative session that the bill would not pass constitutional muster were allayed by the fact that the Legislature has the right to set policy.

“That’s 100 percent purely left up to the Legislature to decide that,” Holland said.

MSDH spokesperson Liz Sharlot said last week that the agency is still reviewing the court’s written opinion, and would have no comment.


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