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02/24/95 MEDICAL ASSOCIATION STATE ALABAMA v.

February 24, 1995

THE MEDICAL ASSOCIATION OF THE STATE OF ALABAMA, ET AL.
v.
ROBERT L. SHOEMAKE, ET AL.



Appeal from Montgomery Circuit Court. (CV-94-141).

Crawley, Judge. Robertson, P.j., and Thigpen, Yates, and Monroe, JJ., concur.

The opinion of the court was delivered by: Crawley

CRAWLEY, Judge

The plaintiffs, the Medical Association of the State of Alabama and four individual physicians, filed a declaratory judgment action challenging the validity of an amendment to an administrative rule promulgated by the Alabama Board of Physical Therapy. The amendment prohibits a physical therapist from being employed by, or from otherwise participating in a professional financial arrangement with, a referring physician. *fn1

The defendants are the Board of Physical Therapy and its individual members and the Alabama Physical Therapy Association. One of the defendants, the Board of Physical Therapy, a state agency that licenses physical therapists, moved to dismiss the action pursuant to Rule 12(b)(6), A.R.Civ.P., contending that the complaint failed to state a claim upon which relief could be granted. Following a hearing, the trial court dismissed the action on the ground that the Medical Association and the four individual physicians lacked standing to challenge the amended rule. The Medical Association and the individual physicians appealed. This cause is before us pursuant to Ala. Code 1975, § 12-2-7(6).

On an appeal from a dismissal based on a lack of standing to challenge an agency rule, we must view the allegations of the complaint in the light most favorable to the plaintiff, resolve all doubts in the plaintiff's favor, and uphold the ruling of the trial court only if we determine that the plaintiff cannot establish a right to judicial review under any set of facts provable under the allegations of the complaint. Richards v. Department of Revenue & Finance, 454 N.W.2d 573, 574 (Iowa 1990). No presumption of correctness exists as to the trial court's application of the law to the facts. Jayroe v. Hall, 624 So. 2d 522 (Ala. 1993). The issue of standing presents a pure question of law, and the trial court's ruling on that issue is entitled to no deference on appeal. Richards v. Cullen, 152 Wis.2d 710, 712, 449 N.W.2d 318, 319 (Wis. App. 1989).

The Medical Association and the four individual physicians filed their declaratory action under Ala. Code 1975, § 41-22-10. That section provides, in pertinent part:

"The validity or applicability of a rule may be determined in an action for a declaratory judgment or its enforcement stayed by injunctive relief in the circuit court of Montgomery county, unless otherwise specifically provided by statute, if the court finds that the rule, or its threatened application, interferes with or impairs, or threatens to interfere with or impair, the legal rights or privileges of the plaintiff."

(Emphasis added.)

Testimony presented at the hearing on the motion to dismiss tended to establish that the Board's amended rule would alter the manner in which the plaintiff physicians are currently practicing medicine and would result in financial loss to those physicians who currently employ physical therapists. Dr. John Semon, a Mobile orthopedic surgeon, whose medical group employs in-house physical therapists, testified that 5200 square feet of office space, $170,000 worth of equipment, and $62,000 in supplies were devoted to the physical therapy unit of his medical practice. Dr. Semon stated that if his in-house physical therapists were forced to terminate their employment with him so as to comply with the Board's amended rule, he would suffer not only financial loss, but also "the ability to oversee the physical therapists" to whom he sends his patients. He gave his opinion that the lack of close communication with and supervision of those physical therapists would result in a "big loss in quality of patient care."

Dr. Moses Jones, a Tuscaloosa neurosurgeon, testified that his employment of an in-house physical therapist allowed greater continuity in patient care and "rapid feedback" to the physician, which he described as follows:

"In-office therapy . . . cuts down on some of what I call game-playing on the part of the patient. I tell the patient to go to therapy. If the patient doesn't show up, I don't find out until a month later when I get a report from somebody at the hospital, as opposed to when it's right there in the office. If they don't show up, we know what's going on."

Dr. Jones testified that he had 2000 square feet of office space allotted to his physical therapy unit and $150,000 to $175,000 invested in his physical therapy equipment. He stated that if the Board implemented its amended rule, he would suffer a financial loss by having to make lease payments for facilities and equipment that he could no longer use.

The trial court's determination that the Medical Association and the four individual physicians did not have standing to challenge the rule was apparently based on a Conclusion that physical therapists were the only parties directly affected by the rule and, therefore, the logical parties to challenge the rule. However, "[a] party may have standing without being the primary object of the agency action," Richards v. Department of Revenue & Finance, 454 N.W.2d at 575, and "in some instances, the party's particular relationship to the subject of the [agency] action may ...


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