St. Joseph's Hosp. and Medical Center v. Maricopa County, 1
| Decision Date | 07 September 1989 |
| Docket Number | CA-CIV,No. 1,1 |
| Citation | 786 P.2d 983,163 Ariz. 132 |
| Parties | ST. JOSEPH'S HOSPITAL AND MEDICAL CENTER, an Arizona corporation, Plaintiff-Appellant, v. MARICOPA COUNTY, a body politic, Defendant-Appellee. 88-047. |
| Court | Arizona Court of Appeals |
This case deals with the statute that defines indigency for purposes of public health assistance. We hold that the statute must be construed to render a patient ineligible for public assistance if his spouse owns separate property that exceeds the maximum set by the statute. We also hold that the statute, so construed, does not offend due process and does not work an unconstitutional taking of property.
Donald Neu was admitted as an emergency patient to St. Joseph's Hospital and Medical Center in April of 1985, and he remained hospitalized there for almost two months, incurring charges of over $50,000, of which he paid only a small part. St. Joseph's sought reimbursement of most of the balance due from Maricopa County, and the county refused to pay, claiming that Neu was not eligible for assistance.
For the purposes of this appeal, eligibility for county health care is determined under the version of A.R.S. § 11-297(B)(2) that was in effect in 1985. An indigent was then defined as a resident of the county whose income does not exceed a specific level, and
[d]oes not have resources of all persons in the household, including but not limited to equity in a house or car, with a net worth in excess of thirty thousand dollars, with no more than five thousand dollars cash or other liquid assets.
A.R.S. § 11-297(B)(2) (1985 Ariz.Sess.Laws ch. 316, § 5). 1
Donald Neu's assets at the time of his hospitalization totaled substantially less than $30,000. His wife owned, as her sole and separate property, the home in which they lived, a part interest in a shopping center, and some automobiles. Because the value of Mrs. Neu's separate property exceeded the statutory maximum, Maricopa County determined that Donald Neu was not "indigent" and was therefore not eligible for county health services. Maricopa County denied St. Joseph's claim for reimbursement of Donald Neu's hospitalization charges.
St. Joseph's sued the county on its claim, and the trial court, agreeing with the county's position, granted summary judgment in its favor.
On appeal, we consider the following questions:
A. Statutory Interpretation: Whether the separate property of a spouse can be considered in determining an individual's indigency pursuant to A.R.S. § 11-297(B)(2);
B. Due Process: Whether A.R.S. § 11-297(B)(2) is arbitrary and denies Donald Neu and St. Joseph's due process;
C. Unconstitutional Taking: Whether Maricopa County's failure to reimburse St. Joseph's for emergency services is an unconstitutional taking of private property without just compensation; and
D. Restitution: Whether St. Joseph's is entitled to recover from Maricopa County for services rendered under a theory of restitution.
We decide each of these issues in favor of Maricopa County.
The parties agree that the medical expenses of a spouse are not collectable out of the separate property of the other spouse. Donald Neu's medical expenses were payable only out of the community income and assets and Donald's separate property. For the purpose of this opinion, we accept that as the law. 2
To be eligible for county health care benefits, a person must have income below a specified level and may not have "resources of all persons in the household" in excess of $30,000 with not more than $5,000 in cash or other liquid assets. A.R.S. § 11-297(B)(2). According to St. Joseph's, Arizona community property principles and public policy require that the phrase "resources of all persons in the household" in § 11-297(B)(2) be construed to include only assets actually available to the patient or his creditors. So construed, the statute would require the county to reimburse the hospital for Neu's care.
Eligibility statutes, the hospital argues, must be liberally construed with the dual purposes of delivering health care to those who cannot afford it and protecting a private hospital's right to receive reimbursement from the county. It cites a number of Arizona decisions for this premise. Although we acknowledge the underlying principle, none of the cases cited offer specific guidance in determining whether "resources of the household" must be construed to exclude a spouse's separate property when the plain language of A.R.S. § 11-297(B)(2) states otherwise.
St. Joseph's also cites cases from other jurisdictions for the proposition that welfare statutes or regulations cannot preempt community property principles. See Harper v. New Mexico Dept. of Human Services, 95 N.M. 471, 623 P.2d 985 (1980); Duran v. New Mexico Dept. of Human Services, 95 N.M. 196, 619 P.2d 1240 (App.1980); see also Purser v. Rahm, 104 Wash.2d 159, 702 P.2d 1196 (1985), cert. dismissed, 478 U.S. 1029, 107 S.Ct. 8, 92 L.Ed.2d 763 (1986), all holding that the uniform federal regulation, which was meant to apply to all states (both community and non-community property), had to be interpreted in the context of local law. These decisions shed little light on how the specific problem before us is to be resolved. In this case, the same legislature which has codified our community property law enacted A.R.S. § 11-297.
St. Joseph's also cites Herrera v. Health & Social Services, 92 N.M. 331, 587 P.2d 1342 (App.1978), which held that the word "income," as used in New Mexico's eligibility statute, had to be interpreted in light of that state's community property law. The upshot was that since half the patient's income belonged to his wife under community property principles, he was under the maximum limit to qualify for public assistance. The problem is that in the context of the New Mexico statute, "income" was a more ambiguous term than the phrase, "resources of all persons in the household," with which we deal here.
In our opinion, this phrase, "resources of all persons in the household," unmistakably indicates an intent to include a spouse's separate property. No limitation of the type of resources--separate or community--is expressed in the statute. To construe it otherwise would require reading into the statute something that the legislature did not put there. This, we ought not do. City of Phoenix v. Donofrio, 99 Ariz. 130, 133, 407 P.2d 91, 93 (1965).
As noted in footnote 1 to this opinion, the legislature has recently amended the relevant statute to exempt the first $75,000 of the spouse's separate assets from the indigency calculation. From this action, we can infer that the legislature was aware of the county's policy to include all separate property in the calculation. The amendment does not reveal whether the county's policy comported with the legislature's intent under the old statute. The amendment is either a liberalization of the qualification guidelines, or a restriction of it, depending on one's viewpoint. In either case, the legislation now clearly requires that a spouse's separate property--albeit only that which exceeds $75,000--be included in the indigency calculation. The legislature was obviously aware of community property principles when it first enacted § 11-297(B)(2). If it intended community property principles to temper the eligibility calculation, it could have expressly done so, as evidenced by the recent amendment.
We turn to St. Joseph's argument that the statute, as we construe it, is arbitrary, capricious, and violative of the due process clauses of the state and federal constitutions.
Economic regulations need only be rationally related to a legitimate state interest. Arizona Downs v. Arizona Horsemen's Found., 130 Ariz. 550, 555, 637 P.2d 1053, 1058 (1981). See also Comment, Economic Substantive Due Process in Arizona: A Survey, 20 Ariz.St.L.J. 327 (1988). St. Joseph's acknowledges this well-settled principle but claims that the inclusion of a spouse's separate propety in the indigency calculation is irrational. We disagree.
As St. Joseph's acknowledges, the legislature may and must draw financial eligibility lines somewhere. Under current eligibility criteria, a married couple can earn no more than $3,333 per year to qualify as indigent. This line is necessarily arbitrary, and, we realize, not realistically calculated to provide adequate health care for any but the poorest of the poor. Those who make more than $3,333 per year and cannot afford medical care are simply on their own, except in one respect--if they present themselves at a hospital for emergency treatment, they cannot be turned away. See Thompson v. Sun City Comm. Hosp., 141 Ariz. 597, 602, 688 P.2d 605, 610 (1984).
As we have already observed, St. Joseph's acknowledges that the legislature must "draw the line somewhere." St. Joseph's admits that the county is not required to reimburse the hospital for those emergency patients who do not qualify under the basic indigency guidelines. However, it challenges a detail in the legislature's drawing of the line when it contends that the legislature so unreasonably narrows its prospects of reimbursement as to violate due process when the legislature includes within the calculation of household assets available to the patient the separate property of the patient's spouse.
We cannot agree that including a spouse's separate property as a legislative exercise in line-drawing lacks sufficient rationality to satisfy the requirements of due process. St. Joseph's argues that the...
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