Godfrey v. Massachusetts Medical Service

• Decision Date: 11 June 1971
• Citation: 359 Mass. 610,270 N.E.2d 804
• Parties: Charles E. GODFREY et al. v. MASSACHUSETTS MEDICAL SERVICE.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 804

270 N.E.2d 804

359 Mass. 610

Charles E. GODFREY et al. v. MASSACHUSETTS MEDICAL SERVICE.

Supreme Judicial Court of Massachusetts, Suffolk.

Argued Feb. 1, 1971.

Decided June 11, 1971.

Joseph P. Rooney, Boston (William F. Kehoe, Boston, with him) for plaintiffs.

Lawrence T. Perera, Boston (John G. Faria, Somerset, with him) for defendant.

Before TAURO, C.J., and SPALDING, CUTTER, SPIEGEL and BRAUCHER, JJ.

SPIEGEL, Justice.

This is a bill for declaratory relief brought as a class suit by seven podiatrists against the Massachusetts Medical Service, commonly known as Blue Shield. The plaintiffs seek, inter alia, a declaration that G.L. c. 176B, inserted by St.1941, c. 306, authorizes podiatrists to participate 'as a matter of right' in the Blue Shield nonprofit medical service plan. The hearing in the case was 'completed' before a judge of the Superior Court who died 'without record of any decision, findings of fact, * * * determination * * * (or) report having been made by her prior to her death.' Thereafter, by agreement of the parties, the case was assigned to another judge for determination 'on the basis of the pleadings and record of the case as contained in the official transcript and the exhibits on file * * * and the briefs submitted by the parties.' The latter judge, after oral argument, made 'Findings of Fact, Rulings of Law, and Order for Decree.' The plaintiffs appeal from a final decree containing the following declarations: '1. This is not a class suit and the named plaintiffs do not represent Masachusetts podiatrists, or any portion of them, as a class, in this proceeding. 2. General Laws Chapter 176B, Section 7, furnishes the exclusive rule governing participation as of right in the defendant's medical service plan. Since only registered physicians may participate under that section and since the plaintiffs are not registered physicians, they are not entitled to participate as of right. 3. General Laws Chapter 176B, Section 7, does not deny any of the plaintiffs equal protection of the laws or due process of law under either the United States or Massachusetts constitutions. 4. General Laws Chapter 176B, Section 4, does not require the defendant to accept the applications of any of the plaintiffs to participate in the defendant's medical service plan. 5. General Laws Chapter 176B, Section 4, does not deny any of the plaintiffs equal protection of the laws or due process of law under either the United States or Massachusetts constitutions. 6. The defendant's refusal to accept the applications of each of the plaintiffs to participate in the defendant's medical service plan was not unlawful.'

We have before us 'Designated Portions of Transcript of Testimony.' In the circumstances, we are in as good a position as the judge who ordered the entry of the decree to appraise the evidence and we make our own determination unaffected by his findings. See Drescher v. Travelers Ins. Co., Mass., 269 N.E.2d 651. ^a

This case involves the constitutionality of the nonprofit medical service plan as it is embodied in G.L. c. 176B. Section 4 of that statute, as amended throught St.1968, c. 432, § 9, provides in pertinent part as follows: 'Any medical service corporation may enter into contracts with its subscribers and with participating physicians, dentists, chiropodists (podiatrists) and optometrists licensed under the laws of the commonwealth, for such medical, visual and surgical services as may lawfully be rendered by them to the subscribers and to their dependents, and may pay for such services' (emphasis supplied). Section 7 of c. 176 B provides in pertinent part: 'Every registered physician shall have the right * * * to enter into a written agreement with a medical service corporation * * * to perform medical service' (emphasis supplied). Medical service is defined as that 'ordinarily provided by registered physicians in accordance with accepted practices in the community where the services are rendered.' G.L. c. 176B, § 1.

Essentially, we are called upon to decide (1) whether § 7 of c. 176 B, by allowing only physicians to participate as a matter of right in the Blue Shield program, arbitrarily and unreasonably discriminates between physicians and podiatrists in violation of the equal protection and due process clauses of the Fourteenth Amendment to the United States Constitution and (2) whether the discretionary power granted to the defendant by § 4 to exclude podiatrists from the Blue Shield program was exercised in an arbitrary and unreasonable manner in violation of the above constitutional provisions. We also briefly consider whether the bill was properly brought as a class suit. In view of our disposition of this case we find it unnecessary to treat with the issues raised in the plaintiffs' briefs concerning (1) whether the defendant is a quasi public corporation so as to bring it within the ambit of the 'state action' doctrine and (2) whether the term 'surgical services' as it is used in G.L. c. 176B, § 4, should be broadly construed.

Section 4 clearly grants to the defendant the discretion to enter into contracts with podiatrists. See Answer of Justices, 346 Mass. 787, 790, 190 N.E.2d 873. It is also clear that § 7 gives only to physicians the right to contract with Blue Shield. The plaintiffs contend, however, that the defendant is a quasi public corporation and that its discretionary power to exclude podiatrists from the program was exercised in an arbitrary and unreasonable manner. They further argue that § 7 unfairly and unreasonably discriminates between physicians and podiatrists which they assert are two similarly circumstanced classes of persons.

It is well established that legislation will be upheld '(u)nless * * * (it) cannot be supported upon any rational basis of fact that reasonably can be conceived to sustain it.' Sperry & Hutchinson Co. v. Director of Div. of Necessaries of Life, 307 Mass. 408, 418, 30 N.E.2d 269, 274. Coffee-Rich, Inc. v. Commissioner of Pub. Health, 348 Mass. 414, 422, 204 N.E.2d 281. A statutory distinction or classification satisfies constitutional requirements 'if it is rational and bears some relationship to the object intended to be accomplished.' Hall-Omar Baking Co. v. Commissioner of Labor & Indus., 344 Mass. 695, 700, 184 N.E.2d 344, 348. The Legislature must be afforded wide discretion in accomplishing its objectives. See Opinion of Justices, 303 Mass. 631, 22 N.E.2d 49. 'If the question is fairly debatable, courts cannot substitute their judgment for that of the Legislature.' Druzik v. Board of Health of Haverhill, 324 Mass. 129, 139, 85 N.E.2d 232, 237. 'One assailing a statute on constitutional grounds has the burden of proving the absence of any conceivable grounds upon which the statute may be supported. 'As underlying questions of fact may condition the constitutionality of legislation * * *, the presumption of constitutionality must prevail in the absence of some factual foundation of record for overthrowing the statute. '' Merit Oil Co. v. Director of Div. of Necessaries of Life, 319 Mass. 301, 305, 65 N.E.2d 529, 532, quoting O'Gorman & Young, Inc. v. Hartford Fire Ins. Co., 282 U.S. 251, 257--258, 51 S.Ct. 130, 75 L.Ed. 324. The Supreme Court of the United States in the case of Lindsley v. Natural Carbonic Gas Co., 220 U.S. 61, 78--79, 31 S.Ct. 337, 340, 55 L.Ed. 369, summarized the law in this area as follows: 'The rules by which * * * (the alleged violation of the equal protection clause) must be tested, as is shown by repeated decisions of this court, are these: 1. The equal-protection clause of the 14th Amendment does not take from the state the power to classify in the adoption of police laws, but admits of the exercise of a wide scope of discretion in that regard, and avoids what is done only when it is without any reasonable basis, and therefore is purely arbitrary. 2. A classification having some reasonable basis does not offend against that clause merely because it is not made with mathematical nicety, or because in practice it results in some inequality. 3. When the classification in such a law is called in question, if any state of facts reasonably can be conceived that would sustain it, the existence of that state of facts at the time the law was enacted must be assumed. 4. One who assails the classification in such a law must carry the burden of showing that it does not rest upon any reasonable basis, but is essentially arbitrary.'

In determining whether the classification drawn between physicians and podiatrists by G.L. c. 176B bears a reasonable relationship to the purpose of the statute, we note that the statute has as its purpose to provide 'for the preservation of the public health by furnishing medical services at low cost to members of the public who become subscribers.' Emergency preamble, St.1941, c. 306. This protection of the public health is within the police power of the State and 'is an object of such vital importance to the welfare of the state that any rational means to that end must be upheld.' Commonwealth v. Zimmerman, 221 Mass. 184, 189--190, 108 N.E. 893, 895.

Applying the standards previously recited and that of the Zimmerman case to the instant one, we think that in devising a statutory insurance framework for medical services at low cost to the public it was within the power of the Legislature to make a statutory distinction between physicians and podiatrists. The record shows that Dr. Charles G. Hayden, the executive director of the defendant, testified and deposed that if Blue Shield included podiatrists within its program, it would be assuming an additional financial burden in spite of a lack of demand by subscribers for such coverage. Dr. Hayden's belief was based on the fact that when a new group of participants, such as oral surgeons, have been included in the Blue Shield program, costs have increased. Increased expenses would, of necessity, create increased rates to Blue...