Providence Alaska Medical Center applied to the Alaska Department of Health and Social Services for a CON to build an open-bore MRI facility, and then-Commissioner Joel Gilbertson granted the certificate. Paul Fuhs filed an accusation requesting a hearing before DHSS to challenge issuance of the CON, which Mr. Gilbertson denied, leading Mr. Fuhs to file administrative appeals with the state’s Superior Court. The appeals were consolidated, and the superior court determine that Mr. Fuhs “lacked standing both to challenge the CON administratively and to seek an injunction ? then awarded attorney’s fees to both Providence and Gilbertson, rejecting Fuhs’s assertion that he was a public interest litigant.”
Upon appeal, the state Supreme Court considered two issues:
1. Whether Mr. Fuhs has standing to administratively challenge the CON. Alaska Statute 18.07.081(a) permits a person who is “substantially affected” by the activities authorized by a CON to initiate a hearing by filing an accusation with DHSS. Alaska Statute 18.07.091(a) allows a person “substantially and adversely affected” to file suit for injunctive relief.
Mr. Fuhs asserted that he had standing because he is “a citizen of the State of Alaska and a self-paying consumer of medical services within the State,” that his retirement is threatened by rising costs of medical care, and that, as a self-pay patient, he pays higher prices for care in order to subsidize other services that he does not use. However, the court says that he could not satisfy the most basic test for standing, he is not a competitor of the facility, nor could other individual direct injury be shown:
“As the superior court noted, Fuhs does not allege that he plans to get an MRI scan. At most, Fuhs has alleged an indirect connection between his health care costs and the issuance of CONs. This connection is too tenuous to give Fuhs standing ? Fuhs also refers to the fact that he used to direct the South Central Health Planning Agency and sit on the board of Alaska’s Statewide Health Coordinating Council. Although his former positions might make Fuhs substantially interested in the issuance of CONs, they do not cause him to be substantially affected by the activities authorized by the Providence CON.”
2. Whether Mr. Fuhs is exempt from attorney’s fees awards. While Mr. Fuhs argued before the supreme court that he is a public interest litigant and that the superior court therefore erred in awarding Alaska Civil Rule 82 attorney’s fees to Providence and Mr. Gilbertson against him, he failed to argue this at the superior court and, further, the court order awarding Providence attorney’s fees rejected Mr. Fuhs as a public interest litigant. Finally, Mr. Fuhs did not show such an award would “chill suits by similarly situated litigants.”
In summary, because he was not “substantially affected” by the Providence CON, Mr. Fuhs does not have standing to challenge the issuance of the CON and, because he waived his argument that he should be shielded from attorney’s fees awards, the superior court did not err in awarding attorney’s fees to Providence and Mr. Gilbertson, the court ruled, affirming both the dismissal of Mr. Fuhs’s superior court cases and affirming both attorney’s fees awards.
For the full Alaska Supreme Court opinion, click here.
