Roman Catholic Diocese of Albany v. New York State Dept. of Health

• Decision Date: 20 June 1985
• Citation: 490 N.Y.S.2d 636,109 A.D.2d 140
• Parties: In the Matter of ROMAN CATHOLIC DIOCESE OF ALBANY, New York, et al., Respondents-Appellants, et al., Respondents, v. NEW YORK STATE DEPARTMENT OF HEALTH et al., Appellants-Respondents, and Upper Hudson Planned Parenthood, Inc., Intervenor-Appellant.
• Court: New York Supreme Court — Appellate Division

Page 636

490 N.Y.S.2d 636

109 A.D.2d 140

In the Matter of ROMAN CATHOLIC DIOCESE OF ALBANY, New York,

et al., Respondents-Appellants, et al., Respondents,

v.

NEW YORK STATE DEPARTMENT OF HEALTH et al., Appellants-Respondents, and Upper Hudson Planned Parenthood, Inc., Intervenor-Appellant.

Supreme Court, Appellate Division,

Third Department.

June 20, 1985.

Robert Abrams, Atty. Gen., New York City (Deborah Bachrach, Robert Hermann, Rosemarie Rhodes, Lawrence S. Kahn, Alan D. Aviles and Martha J. Olson, Civ. Rights Bureau, New York City, of counsel), for New York State Dept. of Health, appellants-respondents.

Tobin & Dempf, Albany (Michael L. Costello, David A. Ruffo and Kevin A. Luibrand, Albany, of counsel), for respondents-appellants.

Pattison, Sampson, Ginsberg & Griffin, P.C., Troy (Gerald H. Katzman, Troy, of counsel), for intervenor-appellant.

Hiscock & Barclay, Albany (Kenneth J. Connolly, Albany, of counsel), for Health Systems Agency of Northeastern New York, Inc.

Madeline Kochen, New York City, for New York Civil Liberties Union and another, amici curiae.

Anne E. Simon, New York City, for Center for Constitutional Rights, amicus curiae.

Nadine Taub, Newark, N.J., for Women's Rights Litigation Clinic, amicus curiae, Rutgers Law School.

Before MAHONEY, P.J., and CASEY, WEISS and LEVINE, JJ.

PER CURIAM.

In June 1983, intervenor, Upper Hudson Planned Parenthood, Inc. (Planned Parenthood), applied to respondent New York State Department of Health (DOH) pursuant to Public Health Law § 2802 for approval of an expansion of its existing, licensed health clinics in the Cities of Albany and Hudson to enable them to provide nonhospital abortion services. Under both State law (Public Health Law § 2802) and Federal law (National Health Planning and Resources Development Act of 1974 [NHPRDA] [42 U.S.C. § 300k et seq.] ), approval of the application entailed review under a certificate of need (CON) program to determine the public need for the proposal, the applicant's competence and the financial feasibility of the proposed service. A State's adherence to a CON program is a condition of receiving Federal financial assistance under NHPRDA (42 U.S.C. § 300m-1[b][5]; § 300m-2[a][4][B]; § 300m-6). New York has legislatively opted to participate in the Federal program (see Public Health Law § 2802[3-b] ).

As required under the statutory scheme (Public Health Law § 2802[2], [3-b] ), Planned Parenthood's application was referred to respondent Health Systems Agency of Northeastern New York, Inc., which rendered its report recommending approval of the application in late July 1983. The application was processed by DOH under an abbreviated administrative review procedure rather than full review, as was permitted by departmental regulations (10 NYCRR 710.1[b][5] ). DOH approved the application on December 20, 1983, but delayed issuing the amended operating certificate pending an on-site inspection of Planned Parenthood's Albany and Hudson facilities after the construction work necessary for the expansion was completed. During the interim period, the proposed project came to the attention of the news media and was the subject of considerable public interest. In response thereto, DOH decided to hold a public hearing to solicit information and to determine whether the approval of the application should be rescinded. The hearing was held on November 9, 1984, at which the various petitioners herein each appeared personally or through representatives.

Following the hearing on Planned Parenthood's proposal, DOH reaffirmed its initial approval. The instant CPLR article 78 proceeding was then commenced and Planned Parenthood was allowed to intervene. Special Term granted the petition, annulled DOH's determination approving Planned Parenthood's application and remitted the matter to DOH for reconsideration. In so ruling, Special Term held, inter alia, (1) that the individual petitioners had standing to challenge the determination, (2) that petitioners Roman Catholic Diocese of Albany, New York, and Catholic Charities of that Diocese did not have such standing, and (3) that the determination was invalid because it was based in "major part" upon an "unpublished department policy" that a public need for nonhospital-based abortion services exists whenever less than 50% of all abortion services are available on an out-of-hospital basis (the so-called "50% rule"). These cross appeals ensued.

Regarding the threshold question of standing, we have concluded that each of the petitioners had the right to seek judicial review of DOH's determination under NHPRDA and the companion Federal regulations. Having opted to participate in and receive the financial benefit of the CON program under the Federal Act, New York is bound by the provisions thereof insofar as they mandate access to an appropriate State court for the purpose of challenging a State health agency's decision on need. We are unpersuaded by Planned Parenthood's contention that NHPRDA does not apply to its application because the expansion of services does not entail costs meeting the statutory minimum dollar amounts for new "institutional health services" or "capital expenditure[s]" (42 U.S.C. § 300n[5], [6] ), each of which triggers mandatory CON review under the Federal statute. The statutory phrase "capital expenditure" is alternatively defined under NHPRDA as one which "substantially changes the services of such facility" (42 U.S.C. § 300n[6][B][ii][III] ), and the correlative Federal regulation is consistent in providing that CON review is required for a capital expenditure, irrespective of cost, when it includes the addition to an existing facility of a health service not offered within the previous 12 months (42 CFR 123.401, 123.404[a][3] ). It cannot seriously be contended that adding out-patient abortion services to Planned Parenthood's clinical service is not such a new "health service", thereby making applicable all of the mandatory procedures under the Federal CON program.

The judicial review section of NHPRDA (42 U.S.C. § 300n-1[b][12][E] ) provides in pertinent part:

Any person adversely affected by a final decision of a State Agency with respect to a certificate of need * * * and a health systems agency if the decision * * * is inconsistent with a recommendation made by the agency to the State Agency * * * may * * * obtain judicial review of it in an appropriate State court (emphasis supplied).

A "person adversely affected" is not defined in the Federal act. However, the Federal regulations in effect at the time of the initiation of this proceeding defined the phrase as including any person residing within the geographical area to be served under the application, or who regularly uses health care services within that area, or who participated in the proceeding before the State agency (42 CFR 123.401, 123.410[14] ). This expansive conferral of standing conforms to the relevant legislative history, wherein the persons authorized to seek judicial review of a State CON determination are described in virtually identical language (see S.Rep. No. 96-96, 96th Cong, 1st Sess,reprinted in 1979 U.S.Code Cong. & Ad.News 1306, 1377). Although the House of Representatives passed a different bill from that enacted by the Senate, reconciliation of the two bills by the House-Senate Conference Committee resulted in a judicial review provision which "conforms to the Senate bill except that it requires judicial review to be limited to certificate of need decisions" (H.R.Rep. No. 96-420, 96th Cong., 1st Sess, reprint in 1979 U.S.Code Cong. & Ad.News 1422, 1445). Therefore, the legislative history of the Senate bill continues to be germane in ascertaining congressional intent on the question of standing. Since the Federal regulation in effect at the time of the commencement of this proceeding is not in conflict with the NHPRDA section on standing and is not challenged as beyond the scope of the regulatory authority of the Secretary of Health and Human Services, it should be controlling over any State restriction on access to the courts by persons having a Federal right to review State agency CON decisions (see Lewis v. Martin, 397 U.S. 552, 556-559, 90 S.Ct. 1282, 1284-1286, 25 L.Ed.2d 561; Matter of Marino v. Town of Ramapo, 68 Misc.2d 44, 58, 326 N.Y.S.2d 162; E.I. du Pont de Nemours & Co. v. Board of Stds. & Appeals of City of N.Y., 5 Misc.2d 100, 102, 158 N.Y.S.2d 456, affd. 5 A.D.2d 811, 170 N.Y.S.2d 982; see also Matter of Chambery v. Axelrod, 101 A.D.2d 610, 611, 474 N.Y.S.2d 865).

It is true, as Planned Parenthood and DOH point out, that amendments to the Federal regulations were adopted in January 1985, effective February 13, 1985, which eliminated the foregoing express provisions on standing and substituted a general direction requiring each State to adopt consistent judicial review procedures (50 Fed Reg 2008, 2018). However, there is nothing to indicate that the deletion was intended to restrict standing to obtain judicial review of CON decisions or that, in any event, it was designed to apply retroactively to already pending judicial review proceedings in which a party had valid standing when the proceeding was commenced. Therefore, the amendment to the Federal regulation should not be applied to undo standing already validly acquired (see Simonson v. International Bank, 14 N.Y.2d 281, 289-290, 251 N.Y.S.2d 433, 200 N.E.2d 427; Shielcrawt v. Moffett, 294 N.Y. 180, 189-190, 61 N.E.2d 435; cf. Matter of Asman v. Ambach, 64 N.Y.2d 989, 489 N.Y.S.2d 41, 478 N.E.2d 182; Matter of Consolidated Edison Co. of N.Y. v. State Bd. of Equalization & Assessment, 103 A.D.2d 453, 480 N.Y.S.2d 789).

It follows from the foregoing that since each of the petitioners was either a resident of the geographical area affected by Planned Parenthood's application or participated personally or through a representative in the administrative proceeding, each has a Federally created...