King County Public Hospital District No. 2 v. Department of Health

Summary

The Washington Supreme Court affirmed the Court of Appeals’ reinstatement of a certificate of need issued to Odyssey for a hospice facility in King County. The court held that the health law judge did not abuse his discretion by considering a later need calculation, and that the Department of Health’s findings regarding other certificate-of-need criteria were not arbitrary or capricious. The court also held that competing providers received sufficient notice and opportunity to comment and had no statutory or due process right to a full adjudicative hearing on the settlement.

Holdings

1. A health law judge may, in the exercise of substantial evidentiary discretion, consider a later need calculation when special circumstances justify doing so, even though the evidence was unavailable when the certificate-of-need application was initially evaluated and after the public-comment period closed.
2. The Department did not act arbitrarily or capriciously in relying on the 2008 need analysis, excluding Kline Galland and Providence ElderPlace from the calculation, or concluding that Odyssey satisfied the certificate-of-need criteria.
3. Competing providers who received notice and an opportunity to comment on a proposed certificate-of-need settlement were not entitled to demand a full adjudicative proceeding before the health law judge.

Questions Presented

1. Whether the health law judge abused his discretion by considering the 2008 need calculation, which became available after Odyssey's 2006 certificate-of-need application and the close of the initial public-comment record.
2. Whether the Department's 2008 need analysis and the health law judge's finding that Odyssey satisfied the non-need certificate-of-need criteria were arbitrary or capricious or unsupported by substantial evidence.
3. Whether the health law judge violated competing providers' statutory or procedural due process rights by approving the settlement without holding a full adjudicative proceeding on the merits.

Disposition

affirmed