I N T H E SUPR EM E C O UR T O F M I SS I SS I PPI NO. 2 0 0 4 - S A- 0 1 2 4 0 - S CT S T. DOM

I NIC-M ADI S ON COU

NTY M EDICAL CENTER, S T. DOM

I NIC- J ACKS ON M

EM ORI AL H OSPI TAL AN

D M I SS I SS I PPI STATE DEPARTM

EN T OFH

EALTH

v. M ADI S ON COU

NTY M EDICAL CENTER ON M OTI ON F OR RE HEAR I NG D A T E O F JU D G M E N T : 05/ 28/ 2004 T RI AL J UDGE : HON. S T UAR T RO BI NS ON COURT F ROM W HI CH APP EAL ED: HI NDS COUNTY CHANCERY COURT A TTO RN EY S FO R A PPELL A N TS: K A TH RY N RU SSELL G I LC H RI ST E D M U N D L
. B R U N IN I S ARAH E. BER RY ATT ORNEYS F OR APP EL LE E: THOM AS L
. KI RKLAND, J R. ANDY L OWRY J UL I E ANN B OWM AN NA TUR E OF THE C ASE: CI VI L - STATE BO AR DS A ND AG ENC I ES D I SPO SI T I O N : A FFIRM E D - 05/ 04/ 2006 M OTI ON FOR REH EAR I NG FI LED: 0 9 / 2 2 / 2 0 0 5 ; GR AN TED M ANDAT E I S S UE D:

EN BA NC. EAS LEY, J UST I CE, FOR TH E COU RT: ¶1. T he m o tio n f

o r reheari ng i s grant ed. T he pri or op i nions are w i t hd raw n, and t hese

o p inion s are su b sti tuted there fo r. ¶2. T hi s cas e conce r ns w hether t he H i nds C ount y C hance r y C our t err ed by r ever s i ng t he appr oval byt he M i s s i s s i ppi St at e D epart m ent o f H ea lt h ( D epart m ent ) of an a m ended

### The De partm e nt of He a l th joi ne d the a

ppe l l at e bri e f and argum e nt s ubmi tt e d by 1 

### St. Dom inic . I t s ee ks that the dec is ion o f the chancel lor be re vers ed and the Department’ s de c i s i on a ffi rm e d. 2 a p p lica tio n f

o r a c e rtific a te o f n e e d (C O N ) to S t. D o m in ic- Ja c k so n M e m o ria l H o sp ital (S t. D om i ni c) fora fa ci l i t yt o be l ocat ed i n M adi s on C ount y , M i s s i ssipp i
. T he mai n ar gum ent
c e n ter s o n w h e th e r S t. D o m in ic so u g h t a “ re lo c a tio n ” o f lice n se d b e d c a p a c it y f r o m its 1 Ja c k so n lo c a tio n to a M a d iso n C o u n tylo c a tio n o r so u g h t a “ n e w ” h o sp ital. ¶3. St
. D om i ni c i s a gener al acut e car e faci l i t y . T he hos pi t al had a l i cens ed ca paci t yof 571 beds w hi ch cons i s t ed of 453 m edi cal / s ur gi cal beds , 35 chemi cal dependa ncybeds and 83 ps y chi atr i c beds
. I n J une 2002, St
. D om i ni c fi l ed a CO N appl i cat i on w i t h t he D epart m ent
re q u e stin g a p p ro v a l f

o r a n e w 1 0 0 b e d h o sp ital in M a d iso n C o u n ty . In S e p tem b e r 2 0 0 2 , S t. D om i ni c s ubm i t t ed an a m ended a ppl i cat i on t o t he D epart m ent
. T he amended app li ca ti on
r epl ace d t he or i gi nal appl i cat i on s ubm i t t ed i n J une 2002. T hi s amended appl i cat i on s ought t o r e l o c a t e 1 0 0 e x i s t i n g b e d s f r o m i t s 5 7 1 l i c e n s e d b e d s i n J a c k s o n t o M a d i s o n C o u n t y. ¶ 4
. M a d i s o n Co u n t y M e d i c a l Ce n t e r ( M CMC) o p p o s e d S t
. Do mi n i c ’ s a me n d e d CO N

a p p lica tio n a n d re q u e ste d a p u b lic h e a ri n g o n th e m a tter. T h e D e p a rtm e n t g ra n ted S t. D om i ni c’ s amended C O N appl i cat i on. H ow ever , t he D epart m ent onl y per m i t t ed 50 beds a t t he M adi s on fac i l i t y i ns t ead of t he 100 beds r eques t ed i n St
. D om i ni c’ s amended appl i cat i on. Fol l ow i ng t hi s rul i ng, M C M C appea l ed the D epart m ent ’ s deci s i on t o t he C hance r yC our tof H i nds C ount y . I n hi s opi ni on, dat ed M ay27, 2004, C hance l l orW i l l i am S i ngl et ary , r ever s ed t he D epart m ent ’ s gr ant of t he 50 bed fac i l i t y . T her eaf t er , t he H onor abl e S tuart R o b inson,

### 3

C hance l l or , exec ut ed the fi nal j udgm ent r ever s i ng t he D epart m ent ’ s fi nal or der
. Fol l ow i ng th is ru lin g , S t. D o m in ic a n d th e D e p a rtm e n t ap p e a led to th is C o u rt. FACTS ¶ 5
. In Ju n e 2 0 0 2 , S t. D o m in ic f iled a C O N a p p lica tio n w ith th e D e p a rtm e n t, se e k in g to
es t abl i s h 100 new acut e ca r e beds i n M adi s on C ount y , w hi ch i s par t of t he G ener al H os pi t al S e rv ice A re a 3 (G H S A -3 ) w h ich in c lu d e s H in d s, M a d iso n a n d R a n k in C o u n ties
. D u rin g th is t i m e, M C M C had fi l ed an appl i cat i on w i t h t he D epart m ents eeki ng t o m ove al l 67 of i t s beds fr om M adi s on C ount y t o H i nds C ount y . M C M C i s t he onl yhos pi t al i n M adi s on C ount yand i s l ocat ed i n C ant on. ¶6. T he D epart m ent i nfor m ed St
. D om i n ic that u nt i l t he appl i cat i on fr om M C M C w as deci ded, St
. D om i ni c’ s appl i cat i on w oul d notbe pr oces s ed and w oul d be hel d i n abey ance . T her eaf t er , on A ugus t1, 2002, St
. D om i ni c as ked thatt he or i gi nal appl i cat i on be def err ed. O n Sept ember 3, 2002, St
. D om i ni c s ubm i t t ed an amended appl i cat i on t o t he D epart m entas
a r epl ace m ent for i t s or i gi nal appl i cat i on. T he amended appl i cat i on s ought t o r el ocat e 100 l i censed bed s fr om t he Jack son locat i on t o M adis on C ou nty
. S om et i m e du ri ng t his process, th e D e p a rtm e n t d e n ied M C M C ’s r e q u e st to m o v e a ll o f its b e d s f

ro m M a d iso n C o u n ty t o H i n d s C o u n t y. ¶ 7
. M C M C c h a lle n g e d S t. D o m in ic ’s a m e n d e d a p p lic a tio n a n d req u ested a h ea ri n g b ef o re t he D epart m ent
. M C M C ar gued tha t ther e w as no need t o r el ocat e beds beca us e M adi s on C o u n tyw as o v er-b ed d ed ; th e C an ton h o sp it al m et th e n ee d s o f the c o u n ty ; St. D o m inic’s

### 4

amended appl icati o n s oughtt o es t abl i s h a new hos pi t al ; and the D epart m ent ’ s deni al of M C M C ’s r e q u e st to m o v e its b e d s f ro m M a d iso n C o u n tyto H in d s C o u n typ ro h ib ited S t. D om i ni c’ s amended appl i cat i on t o r el ocat e beds
. A ccor di ng t o M C M C , t he onl ym at er i al di ffe r ence i n t he or i gi nal appl i cat i on and the amended appl i cat i on w as t hatt he amended appl i cat i on s oughta r el ocat i on i ns t ead of a new hos pi t al
. M C M C al s o r el i ed on t es t i m ony gi ven byH ar ol d A r m s t r ong, t he hea d of t he D epart m ent ’ s C O N di vi s i on, w ho t es t i fi ed that t he onl ydi ffe r ence betw een the tw o appl i cat i ons w as t hatone s ai d “new hos pi t al ” an d t he othersai d “rel ocati on . ” A po rt i on of A rm strong’s t est i m on yfoll ow s: Q
. W i t h r egar d t o every t hi ng el s e [othert han the cha nge fr om bui l di ng a new hos p it al to an appl i cat i on forr el ocat i on] , i n t erm s of oper at i ng cost s and the cost of t he faci l i t yand t he p ers on nel and p ers on nel cost s, the o ri g inal ap p li ca ti o n [f o r ne w h o sp it al] an d the a m e n d m en t [fo r a “ re lo c a tio n ” ] is id e n tica l b a sic a lly , isn ’t it? A
. Y e s . S a m e s i z e f a c i l i t y. Q. W oul d you ag r e e w i t h m e , M r . A r m s t r ong , t hat t he r e r e al l y i s no di f f e r e nc e i n t he s e t w o a ppl i c at i ons f or t he c os t of c ons t r uc t i on, t he ope r at i on, t he r e ’ s no c os t i n t hi s, t he onl y di f f e r e nc e be i ng o ne appl i c at i on s ays a ne w hos pi t al , and t he ot he r s ays r e l oc at i on? A
. T hati s t he bas i c di ffe r ence . Q. Al l r i g h t , s i r . An d , M r . Ar ms t r o n g , w o u l d y o u a l s o a g r e e w i t h me i n s um m ar y t hat t he r e ’ s no a ppar e nt r e duc ti on of any of t he s ervi ces curre nt l y bei ng provi ded at t he H i nds C ounty or Jackson St . Domi ni c ’ s f

a c i l i t y a f t e r t he y mov e be ds t o M a di s o n Cou nt y? A. I t w as n’ t s t at e d i n t he appl i c at i on.

### 5

Q
. A n d in f

ac t th e a p p li ca ti o n b ri n g s y o u to the co n clus ion that there does n’ t appea r t hat t her e i s goi ng t o be anydecr eas e i n cos tatt he H i nds o r Ja c k so n f

a c ili ty , d o e s it? A
. T h a t’s c o rre c t. F u rth e r, th e D e p a rtm e n t c o n sid e re d S t. D o m in ic’ s c h a n g e s a s a n a m e n d e d a p p lica tio n w ith a $500. 00 fee i ns t ead of a new appl i cat i on w i t h a $25, 000. 00 fi l i ng fee
. ¶8. Fol l ow i ng t he hea r i ng, t he hear i ng offi cer r ecomm ended t hat St
. D om i ni c’ s amended appl i cat i on be gr ant ed, al l ow i ng 5 0 r athert han a 100 be ds t o be r el ocat ed t o M adi s on C ount y . T he St at e H eal t h O ffi cert hen acce pt ed t he hear i ng offi cer ’ s r ecomm endat i on and

a p p ro v e d th e a m e n d e d a p p lic a tio n a n d g ra n te d th e C O N f o r 5 0 b e d s . ¶9. M C M C appea l ed the D epart m ent ’ s appr oval of the C O N t o t he C hance r yC our tof t he Fi r s tJ udi ci al D i s t r i ctof H i nds C ou nt y . O n M ay27, 2004, C hance l l orSi ngl et aryr ever s ed t he D epart m ent ’ s gr antof the C O N
. T h e chance l l orfound thatt he D epart m ent ’ s fi ndi ngs
w er e arbi t r aryand ca pr i ci ous and nots uppor t ed by s ubs t ant i al evi dence
. Fr om t hi s rul i ng, S t
. D om i nic and t he D epart m ent fi l ed an app eal t o thi s C ou rtrai si ng t he fo l l ow i ng i ssues: I . W het her t he M i s s i s s i ppi D epartm ent of H eal t h’ s det erm i nat i on t hat St . D om i ni c’ s A m ended A ppl i cat i on i s f or a re l ocat i on and not f or a new hospi t al i s s upp ort ed by s ubst ant i al evi dence.

I I . W het her t he D epart m ent ’ s f i ndi ng t hat t here i s a need f or a d d it ion a l acu te c a re b ed s in M a d ison C o u n ty , a n d th a t, a s a re su lt , S t. D o m in ic’ s C O N a p p lica tio n sa tisfie d th e n e e d r e q u ire m e n t is s upp ort ed by s ubst ant i al evi dence.

### 6

I I I . W het her t he D epart m ent ’ s f i ndi ng t hat St . D om i ni c am ended appl i c at i on s ubs t ant i al l y co m pl i e d w i t h t he ge neral g oa l s of t he St at e H eal t h P l an i s s upp ort ed by s ubst ant i al evi dence.

I V . W het her t he D epart m ent ’ s f i ndi ng t hat St . D om i ni c’ s am ended a p pl i cat i on subst ant i al l y com pl i ed w i t h t he G eneralR evi ew C r i t e r i a s e t f

or t h i n t he C O N R e vi e w M anua l i s s uppor t e d by s ubst ant i al evi dence. DI S CU S S I ON ¶ 1 0
. T h is C o u rt c o n c lu d e s th a t th e c h a n c e llo r c o rre c tlyf o u n d th a t St

. Dom inic - J

acks on Me m ’l Ho sp . v. Miss iss ip p i S ta te D e

p ’t o f He a lth , 7 2 8 S o . 2 d 8 1 , 8 3 (M iss . 1 9 9 8 ), is appl i cabl e and contr ol l i ng i n t hi s cas e. I n keepi ng w i t h t he hol di ng of the St . D om ini c cas e,
w e fi nd t hatt he cha ncel l or corr ect l y rul ed t hat t he am ended C O N appl i cat i on s ought a new hos pi t al and nota r el ocat i on. T he cha ncel l ors t at ed: M SD H and St
. D om i ni c r eadi l yadmi tt hati f the “Cri t er i a and St andar ds for t he Est abl i s hm entof a G ener al A cut e C ar e H os pi t al ” w er e us ed, t he A ppl i cat i on w oul d fai l
. T her efor e, i t w oul d be fut i l e for t hi s C our tt o r emand f o r f u rth e r c o n sid e ra tio n o f w h e th e r S t. D o m in ic c a n sh o w th e a p p ro p ria te st and ard of n eed f

or w hat the p roj ectactuall yi s. S in c e S t. D o m in ic in d ica ted th a t it c o u ld n o t m e e t th e n e e d re q u ire m e n t f o r a n e w h o sp ital, th e c h a n c e llo r c o rre c tlyru led th a t re m a n d o f th e c a se w o u ld b e f

u ti le in lig h t o f

S t. D om i ni c’ s i nabi l i t yt o m eett he pr opers t andar d of nee d. T her efor e, w e fi nd t hatt he chanc el l ordi d not err i n t hat fi ndi ng, and t hi s C our t need onl y addr es s I s s ue I , w hethert he

a m e n d e d a p p lic a tio n is a n e w h o s p ita l o r a re lo c a tio n .

### T h is last am en dm ent to th is statute w as ef f ectiv e f ro m Jun e 3 0 , 2 0 0 1 , w ell 2 

### be for e June 3, 2002, whe n St
. Domi ni c fi l e d the ori gi na lCON a ppl i c at i on. 7 ¶11. C er t i fi cat es o f nee d ar e r equi r ed i n cert ai n ci r cumst ance s pur s uantt o M i s s . C ode A nn. § 4 1 -7 -1 9 1 (1 ) (R e v . 2 0 0 5 ). T h is s tatu te s tate s, in p a rt: 2 ( 1 ) N o pe r s o n s h a l l e n g a g e i n a n yo f t h e f o l l o wi n g a c t i v i t i e s wi t hout obt ai ni ng t he r equi r ed ce r t i fi cat e of ne ed: ( a) T he construct i on, devel opm ent or ot her es t abl i s hm ent of a ne w h e a l t h c a r e f

a c i l i t y; * * * ( e) T he r el ocat i on of one or m or e heal t h s ervi ces fr om one phy s i cal f a c ility o r s ite to a n o th e r p h y s ic a l f a c ility o r s ite
. . . . M iss. C o d e A n n . § 4 1 -7-1 9 1 (1). ¶12. T he s t andar d of r evi ew for a fi nal or der of t he St at e H eal t h D epart m ent i s contr ol l ed b yM iss . C o d e A n n . § 4 1 -7 -2 0 1 (2 )(f ) (R e v . 2 0 0 1 ) w h ich p ro v id e s in p e rtin e n t p a rt: T he or ders hal l notbe vac at ed ors etas ide, e i t heri n w hol e ori n par t , exce pt forerr or s of l aw , unl es s t he courtfi nds t hatt he or derof the St at e D epart m ent of H eal t h is no tsupp ort ed b ysubst anti al evidence, i s co ntr ary t o the m anifest w ei ghtof the evi dence , i s i n exce s s of the s t atut or yauthor i t yorj ur i s di ct i on of t he St at e D epart m ent of H eal t h, or vi ol at es anyves t ed cons t i tut i onal r i ght s of a n yp a rtyin v o lv e d in th e a p p e a l. See al s o St . D om ini c, 7 2 8 S o . 2 d a t 8 3 . “T h e d e c isio n o f th e h e a rin g o f

f ice r a n d S tate H e a lth Of f i c e ri s a f f o r d e d g r e a td e f

e r e n c e u p o n j u d i c i a l r e v i e w b yt h i s Co u r t , e v e n t h o u g h we
r evi ew t he deci s i on of t he cha ncel l or . ” Mis s . S ta te D e p ’t o fHe a lth v . N

a tc h e zCm ty . Ho s

p ., 7 4 3 S o . 2 d 9 7 3 , 9 7 6 (M iss . 1 9 9 9 ); S t. D o m in ic , 728 So. 2d at83. T he part ychal l engi ng t he

### 8

a g e n c ya c tio n h a s th e b u rd e n o f p ro o f
. P ub. E mployee s ’R et . Sys . v. Mar quez , 774 So. 2d 4 2 1 , 4 2 5 (M iss . 2 0 0 0 ); H is W a y Ho m es, In c. v. M

iss. G a m ing Co m m ’n , 733 So. 2d 764, 7 6 7 (M is s . 1 9 9 9 ). A . The C hanc e r y C our t r ul i ng . ¶13. T he cha ncerycour tfound the S t. D o m in ic c a s e t o b e c o n t r o l l i n g l a w i n t h i s CO N appl i cat i on. I tfound thatt he D epart m ent act ed arbi t r ar i l y and capr i ci ous l y pur s uant t o t he

s t andar ds s etfor t h i n S t. D o m in ic
. Fur t her , i t found t hatt he D epart m entr efus ed t o us e the S tate H e a lth P lan ’s p rojec tio n o f n e e d f o r w h a t th e p rojec t “ a c tu a lly is” , in a c c o rd a n c e w ith t he St . D om ini c c a se . T h e c h a n c e ryc o u rt h e ld in p a rt: T hi s C our thas t hought ful l ycons i der ed the St . D om ini c cas e and f

i nds i tt o be co n tr ol l i ng l aw as t o t he mat t erathand. T he fa ct s of thes e tw o cas es ar e qui t e si m i l ar . A s i n S t. D o m in ic , a compl et el ynew bui l di ng i s pr opos ed f o r c o n stru c tio n in M a d iso n C o u n ty , in f a c t, th e p rojec t co n tem p late d in th is cas e i s cont empl at ed t o cos t ni ne m i l l i on dol l ar s m or e t hat t he pr oj ectati s s ue i n S t. D o m in ic
. Fur t her , t hi s new bui l di ng w i l l be s t aff ed w i t h new m edi cal w or ker s and new equi pm ent , r ather t han t r ans ferr ed em pl oy ees and equi pm ent f ro m th e Ja c k so n f

a c ili ty . A lso , the re w ill b e n o c o rre sp o n d in g d e c re a se in s e rv ic e s a t th e J a c k s o n h o s p ita l. T heref ore, t hi s C ourt can o n ly f i nd that t he propose d St. D om i ni c hos pi t al i n M adi s on i s , f o r al l pract i cal purposes , a n ew hospi t al
. St
. D om i ni c has ar gued thatt her e nee d be no fac t ual d i s t i n c t i o n b e t wee n t h e t wo c a s e s , a s M SDH i s i n v e s t e d wi t h t he author i t y t o appl yt he “r el ocat i on s t andar d. ” H ow ever , our Sup rem e C ourt h a s p r e v i o u s l y a d d r e s s e d t h i s a r g u me n t i n i t s d e t e r mi n a t i o n t hat “t he s how i ng o f

ne e d m us t be c omm e ns ur at e t o w hat t he pr oj e c t ac t ual l y i s and th e im p a c t w h ic h it a c tu a lly h a s o n th e J a c k s o n h e a lt h c a r e m a r k e t. S t. D o m in ic , 7 2 8 S o .2 d a t 8 9
. A ppel l ees [St
. D om i ni c and M SD H ] m ake c ont i nual r efe r ence t o t he gr eatdefe r ence due the D epart m entand the pr es u m p ti o n i n favorof the D epart m ent ’ s deci s i on. T hi s C our ti s w el l aw ar e of thes e s t andar ds and does no t de vi a t e f

r o m th e m wi t h o u tmu c h c o n s i d e r a t i o n . Ho we v e r , o u rS u p r e me

### 9

C our t has al s o hel d t hat an agency ’ s deci s i on i s arbi t r aryw hen i t“i s notdone acc or di ng t o r eas on and j ud g m en t, butdependi ng on t he w i l l al one, ” and ca p ri ciou s if “d o n e w ith o u t r ea so n , in a w h im sical m an n er, i m p ly ing eith er a l ack of under s t andi ng of ordi s r egar d for the s ur r oundi ng fac t s and s et t l ed co n tr o ll i ng pr i nci pl es . ” R ick s v . Miss iss ip p i S ta te D e

p ’t o f He a lth , 719 So. 2d173, 177 ( M i s s . 1998)
. T aki ng i nt o cons i der at i on t he r ece ntS t. D o m in ic ca se, i t i s clea r t o this C o u rtthat the d ec isi o n o f M S D H in this ca se is arb itrary a n d c a p ri c io u s u n d e r t h e s e s ta n d a rd s . T h e fact s i n thi s case are a l m ost i dent i cal and y et M SD H ref use s t o cons i de r t he curre nt A ppl i cat i on un der th e sa m e c r ite r ia e sp o u se d b y th e S u p r e m e C o u r t in S t. D o m in ic . Pur s uant t o s t atut e, t he contr ol l i ng ques t i on i n everyC O N r evi ew i s w hethert he pr oj ect s ubs t ant i al l ycompl i es w i t h t he Pl an’ s pr oj ect i on of nee d, not any ot herl es s er s ta n d a rd o f

n e e d
. I f M SD H s t rays fr om appl y i ng t he P l an’ s proj ect i on of ne e d, i t c omm i t s l e ga l e r r or , and ac t s ar bi t r ar i l y and ca pr i c i ous l y. I n t he m at t er at hand , M SD H has ref use d t o use t he P l an’ s proj ect i on of need f or w h a t t h e p r o j e c t a c t u a l l y i s . . . . Th e r e f o r e , t h e He a r i n g Of

f i c e r r e a f f i r ms t he de f i ni t i on o f

“r e l oc at i on” f

ound “ hi ghl y s us pe c t ” i n t he pr i or c as e and a p p lies a sta n d a r d th a t h e te r m s “ r e lo c a tio n c r ite r ia .” H o w e v e r , th e r e is no spec i f

i c “re l ocat i on cri t eri a” locate d i n any part of t he P l an or a p p lic a b le s ta tu te s . (E m p h a sis a d d e d ). T h e c h a n c e ryc o u rt d id n o t g iv e a n y d e taile d a n a ly sis f o r th e n e e d c riter ia i n i t s fi ndi ngs . I ts t at ed: M SD H and St
. D om i ni c r eadi l yadmi tt hati f the “Cri t er i a and St andar ds for t he Est abl i s hm entof a G ener al A cut e C ar e H o sp i t al ” w er e us ed, t he A ppl i cat i on w oul d fai l
. T her efor e, i t w oul d be fut i l e for t hi s C our tt o r emand f o r f u rth e r c o n sid e ra tio n o f w h e th e r S t. D o m in ic c a n sh o w th e a p p ro p ria te st and ard of n eed f

or w hat the p roj ectactuall yi s. B

. S t. D o m in ic- J

a c k so n Me m ’l Ho sp . v. Miss iss ip p i S ta te D e

p ’t o f He a lth ¶14. I n S t. D o m in ic , M etho d istM ed ical C en ter (M M C ) fil ed a C O N a p p li ca ti o n fo r a pr i m ary car e cent er know n as t he “N or th C ampus. ” S t. D o m in ic , 728 So. 2d at82. A tt he t i m e of the C O N app l i cat i on , M M C had 47 4 li cence d b eds and op erat ed 2 80 of those bed s. Id . at 8 4 . M M C w a n ted to u til ize 6 4 o f th e re m a in in g 1 9 6 u n u se d lice n se d b e d s fo r th e N o rth

### 10

C am p u s loc atio n . Id
. T he St at e H eal t h O ffi cergr ant ed the C O N and det erm i ned thatt he appl i cat i on w as a “r el ocat i on” w hi ch w as defi ned as “the movi ng of author i t yt o pr ovi de a

s er vi ce f r om one l ocat i on t o another
. ” Id
. T he C O N w as gr ant ed under t hi s defi ni t i on even th o u g h th e re w a s n o re d u c tio n in s e rv ic e s a t M M C ’s m a in c a m p u s . Id
. ¶15. T h is C o u rt ref

raine d fro m rev ersing the cas e on w hethert he def i ni t i on of a ‘r e lo c a tio n ’ w a s a rb itr a ry o r c a p ri c io u s . S t. D o m in ic , 7 2 8 S o . 2 d at 85
. Instea d , this C o u rt fo u n d th a t th e M S D H w as w ith in it s au tho ri tyto interp ret th e m ea n ing o f th e w o rd “r el ocat i on. ” Id
. at84. H ow ever , t hi s C our t found thatt he r eal err ort hatr equi r ed r ever s al

w as t hatt he M SD H appl i ed a much r educe d s t andar d of nee d, t he “a nys peci fi c adva nt age” te s t. Id
. at85. T hi s C our tfound thatt he nee d cr i t er i a “ m us tbe comm ens ur at e t o w hatt he p roje c t a c tu a lly is a n d th e im p a c t w h ic h it a c tu a lly h a s o n th e J a c k s o n h e a lth c a re m a rk e t.” Id . at 8 9 . F u rth e r, th e C o u rt h e ld th a t “ [n ]o les se r sh o w in g o f n e e d w ill b e r e q u ire d b y th is C ourt base d on t he not i on t hat a “rel ocat i on” has t aken pl ace. ” Id
. (em p h asis ad d ed ). U ltim a te ly, th is C o u rt d e n ie d th e C O N a p p lic a tio n . Id
. at92. C . A rg u m e n ts
. ¶16. St
. D om i ni c ar gues t hat i t s amended appl i cat i on w as a pl an t o r el ocat e 100 l i cens ed acut e ca r e beds fr om H i nds C oun ty to M adi s on C ount y . T he D epart m ental s o vi ew ed the appl i cat i on as a r el ocat i on and appl i ed the cr i t er i a fr om t he 2003 St at e H eal t h Pl an w hi ch

c o n c e rn th e re p lac e m e n t/relo c a tio n o f a h e a lth c a re f

a c ili tyo r p o rtio n th e re o f. T h e S tate

### 11

H e a lth O f

f ice r th e n a g re e d w ith sta f f re c o m m e n d a tio n s an d p e rm itt e d 5 0 a c u te c a re b e d s to b e r e l o c a t e d t o M a d i s o n C o u n t y. ¶17. St
. D om i ni c cont ends t hat t hi s C our t never hel d i n t he S t. D o m in ic ca se that the term “r el ocat i on” w as i ncorr ect l ydefi ned. R ather , t he ca s e found thatt h e S tat e H ea l t h O ffi cer
us ed a l ow er s t andar d of nee d fort he r el ocat i on of the beds , and M ethodi s tM edi cal C ent er
n ev er d em o n str ated an yn ee d to m o v e b ed s f ro m o n e p art of

H ind s C o u n tyto an o ther. H ow ever , St
. D om i ni c ar gues t hatt he def i ni t i on o f “re loc at i on” w as notal t er ed byt he S t. D om ini c opi ni on. ¶1 8. T his C ou rt r e fu s e d t o f i nd t ha tt he t e r m “r e l oc a t i on ” w a s a rbi t r a r yor capri ci ou s, hol di ng: T he t er m “r el ocat i on” i s notdefi ned i n t he H eal t h Pl an nori n s t atut e, and the H eal t h O ffi cerw as w it h i n hi s author i t yi n m aki ng hi s ow n i nt erpr et at i on of t hi s t er m . T hi s C our t s houl d not di s turb t hi s i nt erpr et at i on of t he t erm abs ent a fi ndi ng t hatt hi s i nt erpr et at i on i s arbi trary and ca pr i ci ous . T hi s C our thas hel d t hat t he D epart m ent has t he author i t y t o defi ne t erm s in a m anner in c o n s is te n t w ith th e ir g e n e ra lly a c c e p te d d e f in itio n . Miss iss ip

p i S ta te D e

p 't of H ealt h v. G olden T

rian gle R eg'l

Med. Ctr. , 60 3 S o. 2d 85 4, 85 7 (M i ss. 1 9 9 2 ).

. . . . W hi l e thi s C our tfi nds t he H eal t h O ffi cer ' s defi ni ti on of “r el ocat i on” t o be su sp e c t, w e c o n sid e r it u n n e c e ss a ryto d e ter m in e w h e th e r th is d e f in iti o n is arbi t raryand capri ci ou s. S t. D o m in ic , 728 So. 2d at84- 85. ¶19. I n addi t i on, St
. D om i ni c cont ends t hatt he appr opr i at e need a nal y s i s i n t hi s i ns t ance i s fora rel ocat i on and not an ana l y s i s bas ed upon a new hospi t al . T h e re f o re , S t. D o m in ic

### 12

cont ends t hati tnei t heri gnor ed the nee d anal y s i s norappl i ed a r educe d s t andar d of need f or
a r el ocat i on t han i s pr ovi ded byt he St at e H eal t h Pl an. ¶20. St
. D om i ni c al s o cont ends t hatt he cha ncel l orm i s appl i ed the St . D om ini c h o ld in g to t hi s cas e becaus e he s ubs t i t ut ed his j udgm ent f or that of the D epar tm ent . St
. D om i ni c ar gues t hatt he D epart m ent i s t he appr opr i at e ent i t y t o defi ne t he t erm s , and thatt he def i ni t i on w as
su p p o rt e d b ym o re tha n a sc inti ll a o f e v iden ce . S t. D o m inic arg u es th at th e D ep artm en t’ s defi ni t i on of r el ocat i on does notr equi r e the phy sical re loc at i on of w or ker s , equi pm entor
se rv ice s. S t. D o m in ic a lso c o n ten d s tha t th e D e p a rtm e n t ap p lied th e sa m e sta n d a rd se t f o rth i n t he 1998 St

. D om ini c cas e. St
. D om i ni c cont ends t hat t he t w o cas es can be di s t i ngui s hed b ec ause M ethodi s tm ade no s how i ng of an act ualneed f

orr el ocat i on a r g u i n g t h a ta l e s s er
s t andar d of r evi ew appl i ed and no s how of need was r equi r ed
. Th i s Cou r t h e l d i n t he S t. D om ini c cas e thatneed w as r equi r ed and M ethodi s t fai l ed t o s how anyneed, w hi ch w as fat al t o t he appl i cat i on. St
. D om i ni c cl ai m s t hather e i tdemonst r at ed nee d. ¶21. M C M C ar gues t hatSt
. D om i ni c’ s amended appl i cat i on i s nota r el ocat i on appl i cat i on b u t a n e w h o sp ital a p p lica tio n . T h e re f o re , M C M C m a in tain s th a t th e D e p a rtm e n t sh o u ld h a v e re v iew e d th e a p p lica tio n p u rsu a n t to th e c riter ia a n d sta n d a rd s f o r n e w h o sp itals in count i es w i t h an exi s t i ng hos pi t al r athert han as a r el ocat i on. ¶22. M C M C ar gues t hatSt
. D om i ni c i s i n eff ect tr y ing to ev ade t he n e e d c r ite r ia by l abel i ng t he pr opos ed hos pi t al as a r el ocat i on i ns t ead of a new hos pi t al and appl y i ng a l ow er
c r i t e r i o n o f n e e d f

r o m th a t whi c h a n e w h o s p i t a l mus t p r o v e . Fu r t h e r , M CM C a r g u es t hat

### 13

t hi s C our thel d i n t he St . D om ini c cas e t hat ne e d i s de t e r m i ne d on t he bas i s of w hat t he p r o je c t “ a c tu a lly is” a n d n o t o n its la b e l. ¶23. T hi s C our tfi nds t hatt he St . D om ini c c a se is a p p lica b le. S t. D o m in ic c laim s tha t it s
cas e i s di s t i ngui s habl e fr om t hatof M M C i n t he St . D om ini c c a se . W e d isa g re e . T h e f a c ts i n bot h t he cas es conce r n an exi s t i ng hos pi t al ’ s “r el ocat i on” of l i cens ed butcurr ent l yunus ed beds fr om one phy s i cal l ocat i on t o another
. M M C had a l i cens ed capa ci t y of 474 beds and

o p e ra te d 2 8 0 b e d s . S t. D o m in ic , 728 So. 2d at84. O f the 1 9 6 u nus ed beds ornono p e ra tio n a l b e d s , M M C w a n t e d t o “ r e l o c a te ” 6 4 b e d s to a p ro p o s e d N o rt h C a m p u s . Id
. L i kew i s e her e, St
. D om i ni c has a l i cens ed ca paci t y of 571 beds and w ant ed t o r el ocat e 100 beds fr om H i nds C ount yt o M adi s on C ount y . T he chance r y cour tal s o corr ect l yfound that t he fa ct s i n t hi s cas e ar e s i m i l art o M M C ’ s and thatt he St . D om ini c c a se is co n tro lli n g in th is

cas e. ¶24. H er e, t he c h a n c e ryc o u rtneverdet erm i ned thatt he M SD H defi ni t i on of r el ocat i on w as
a rb itrar ya n d c a p ric io u s. R a th e r, itsta ted th a t “S t. D o m in ic a n d M S D H a re c o rre c t in th e ir

ar gum entt hatt he Supr eme C our tdi d notdet erm ine thi s defi ni t i on of r el ocat i on t o be

a rb itr a ry o r c a p ri c io u s .” ¶25. W e r ej ect St
. D om i ni c’ s ar gum ent t hat t he chanc erycour tm i s appl i ed the S t. D o m in ic hol di ng beca us e the cha ncel l oral l egedl y r edef i ned t he t erm “r el ocat i on” i ns t ead of us i ng t he D ep artm en t ’ s defi ni t i on. T he cha ncerycour tw as m er el yappl y i ng t he hol di ng i n t he S t. D om ini c cas e t o t he fa ct s and found t hat t he pr opos ed hos pi t al w as a new hos pi t al r athert han

### Al s o, the He ari ng Offi c e r not e d that

St
. Domi ni c a c knowl e dge d that i t c oul d not 3 

### m eet th e criteria o f

n eedf o r a n ewh o sp ital. 14 a r el ocat i on. I n addi t i on, t he cha ncerycour tfound thatt hi s C our tcons i der ed thatt he

s h o w in g o f n e e d h a d to b e c o m m e n s u r a te to w h a t th e p r o je c t a c tu a lly is . T h e c h an ce ry
cour tfound that“M SD H has r efus ed t o us e t he P l an’ s pr oj ect i on of nee d forw hatt he pr oj ect
a c tu a lly is.” ¶ 2 6
. T h e c h a n c e r y c o u r t c o r r e c tl y re f e re n c e d th a t S t. D o m in ic f a iled to c o n sid e r th is C o u rt’s h o ld in g th a t “th e sh o w in g o f n e e d m u st b e c o m m e n su ra te to w hat t he proj ect actua l l y i s a n d th e im p a c t w h ic h it a c tu a lly h a s o n th e J a c k s o n h e a l t h c a r e m a rk e t.” S t. D o m in ic , 728 So. 2d at 89 ( emphasi s added)
. H er e, t he chanc ery cour t found t hat t he pr oj ect actual l yw as a new hos pi t al
. T he appr opr i at e cr i t eria appl i cabl e fora new hos pi t al ar e the

“ C ri te ri a a n d S ta n d a rd s f o r t h e E s ta b lis h m e n t o f a G e n e ra l A c u te C a re H o s p ita l.” ¶27. I n i t s rul i ng, t he cha ncerycour tnot ed thatSt
. D om i ni c admi t t ed thati tcoul d not m eet t he s t andar d fora new hos pi t al , t her efor e, r emand w oul d be “f ut i l e. ” W e agr ee.

3 ¶ 2 8
. I n add i t i o n , whe n r e v i e wi n g t h i s i s s u e i n t h e c o n t e x t o f M i s s . Cod e A nn. § 41- 7- 191( 1) , i t i s cl ear t hat St
. D om i ni c’ s amended appl i cat i on pr opos ed the cons t ruct i on of a ne w fac i l i t y . C ons i der i ng t he pl ai n l anguage of t he st atut e, t he m os tr eas onabl e i nt erpr et at i on of

s ubs ect i on ( e) “[t ] he r el ocat i on of one orm or e hea l t h s ervi ces fr om one phy s i cal fac i l i t yor
s i t e t o anotherphy s i cal fac i l i t yors i t e” i s as fol l ow s : fi r s t , a “r el ocat i on” means t he tr ans fer of a he al t h s er vi ce. A heal t h s er vi ce, as defi ned i n t he C er t i f i cat e of N eed Revi ew Manual ,

### 15

i s a di agnos t i c, t r eatm ent or r ehabi l i t at i ve s ervi ce. Second, a “r el ocat i on” i s nott he tr ans fer

o f a p a rt o f a h e a lth se rv ice – it i s th e tra n sf e r o f a n e n tire h e a lth se rv ice
. F in a lly , the H e a lth D epart m enthas defi ned “r el ocat i on” as “the movi ng of author i t yt o pr ovi de a s ervi ce f r om one l ocat i on t o another
. ” A r eas onabl e i nfer ence fr om t hi s defi ni t i on i s t hat , aft ert he author i t yt o pr ovi de a s erv ic e has been r el ocat ed, t he tr ans ferr i ng fac i l i t yw oul d no l onger have the author i t yt o pr ovi de the s ame se r vi ce. ¶ 2 9
. St
. Domi n i c ’ s a me n d e d a p p l i c a t i o n p r o p o s e s t h e c o n s t ru c t i o n o f a c o mpl e t e l y new b u il d ing in M ad ison C o u n ty , an d the ne w b u il d ing w il l b e st af fe d w ith n ew m ed ical w o rke rs and new equi pm ent , r athert han transf err ed empl oy ees and equi pm entfr om t he J acks on fac i l i t y . T he M adi s on C ount y fac i l i t yw i l l offe r“s ur geryi n fouroper at i ng uni t s ; hi gh- l evel i m agi ng s ervi ces ; nur s i ng car e 24 hour s perday , s even da y s perw eek; r ehabi l i ta t i on and p h y sical th era p y ; ph arm ac y ; cl inical lab o ratories; an d L ev el IV em erg en cyserv ices.” T h ere i s not hi ng i n t he r ecor d t hat s ugges t s t hatSt
. D om i ni c- J acks on w i l l notcont i nue t o pr ovi de t he s ame se r vi ces . I t i s t her efor e l ogi cal t o concl ude t hatSt
. D om i ni c’ s amended appl i cat i on d o e s n o t in v o lv e “ th e m o v in g o f a u th o ri ty to p ro v id e a s e rv ic e f ro m o n e lo c a tio n to a n o th e r.” ¶30. C l ear l y , St
. D om i ni c’ s amended appl i cat i on s houl d have been c ons i der ed undert he S tat e H eal t h Pl an’ s “C er t i fi cat e of N eed C r i t er i a and St andar ds for the E s t abl i s hm ent of a G ener al A cut e C ar e H os pi t al ” i ns t ead of i t s “C er t i fi cat e of N eed C r i t er i a and St andar ds for C o n stru cti o n , R en o v ati o n , E x p an sion , C ap it al Im p rov em en ts, R ep lace m en t of H ea lth C are F a c ili ties , an d A d d iti o n o f H o sp ital B e d s.” S t. D o m in ic p ro p o se d to re lo c a te b e d s f ro m its

### 16

Jac k so n loca tio n to a n ew M ad ison C o u n tyloca ti o n . B u t no n e o f th e Ja ck so n loca ti o n ’s heal t h s er vi ces w oul d be re l ocat ed t o t he new M adi s on C ount yl ocat i on. N ew heal t h s ervi ces
w oul d be es t abl i s hed att he new faci l i t y . N ew s t aff w oul d be hi r ed and ne w equi pm ent p u rc h a se d to im p lem e n t th e p ro v isio n o f th e n e w h e a lth se rv ice s. “ In th is co n tex t, w e w o u ld ques t i on a pr opos al w hi ch s oughtt o bui l d w hati s , foral l pr act i cal purpos es , a new hos pi t al

. . . undert he gui s e of a ‘ r el ocat i on. ’ ” S t. D o m in ic , 728 So. 2d at89. ¶31. A ccor di ngl y , w e fi nd t hat t he chanc ery cour t di d not err by r ever s i ng t he fi nal or der

o f t h e M S HD a n d d e n y i n g t h e CO N. CO NC L US I ON ¶32. T he St

. D om ini c case i s co ntr oll i ng i n thi s case. T here w e held t hat this C ou rtm ust
cons i dert he appr opr i at e s t andar d o f n ee d bas ed upon w hatt he pr oj ect“ac tual l yi s . ” The chanc erycour tcorr ect l yappl i ed the St . D om ini c cas e t o t hi s cas e and rul ed thatt he ap p li ca ti o n w as f

o r a n ew h o sp it al, n o t a reloc ati o n . F u rth er, w e f ind that the c h an ce ryco u rt
corr ect l yfound thati n l i ght of St
. D om i ni c’ s i nabi l i t yt o m eett he s t andar ds of nee d fora new h o s p i t a l a s o p p o s e d t o a r e l o c a t i o n , t h e r e i s n o n e e d t o r e ma n d t h e c a s e f o rf u r t h e rr e v i e w. T her efor e, t he cha ncery cour t di d not err by deny i ng t he C O N appl i cat i on and r ever s i ng t he M S D H g ra n t o f

th e a p p lica tio n . F o r th e se re a so n s, w e a f f irm th e c h a n c e llo r’s ju d g m e n t. ¶33. AF F I RM ED . S M I T H , C .J ., W A L L E R A N D C O B B , P . J J . , C A R L S O N A N D D I C K I N S O N , J J ., CONCUR. GRAVE S , J . , DI S S ENTS W I TH SEPAR AT E W RI TTE N O PI NI O N. DI AZ AN D R AN DO L P H, J J . , NO T P AR T I CI P AT I NG .

### 17

GR AV E S , J US T I CE , DI S S E NT I NG : ¶34. T he maj or i t ybas es i t s opi ni on on t hi s C our t ’ s pr i ordeci s i on i n St . D om ini c- Jacks on Me m ’l Ho sp . v . Miss . S ta te D e p ’t o f He a lth , 728 So. 2d 81 ( M i s s . 1998)
. B eca us e I bel i eve t hat cas e w as w ronglydecided, I al so beli eve itw ou l d b e i n err or for this C ou rtt o d i spose of the i ns tant ca se b y rel y i ng on i t s pr i oropi ni on i n St . D om ini c- Jacks on . T h e re f o re , I

re sp e c tf u llyd iss e n t. ¶35. T he di s s ent s of J us t i ces R ober t s and B anks i n St . D om ini c - Ja c ks on m o re a c c u ra tely

r efl ectt he de fer ence an admi ni s t r at i ve bodys uch as t he M i s s i s s i ppi St at e D epart m entof H eal t h ( M SD H ) s houl d be gi ven r egar di ng i t s deci s i on t o gr antordenya C er t i fi cat e of N eed (C O N ). I

d. at93- 104 ( R ober t s . J
. di s s ent i ng) , 104 ( B anks , J
. , di s s ent i ng t o den ial of

r ehea r i ngs )
. J us t i ce Rober t s ’ adm o ni t i on t hat“the M SD H ’ s defi ni t i on and appl i cat i on of
thatr es pect i ve de

f i ni t i on to this c ase sh o u ld n o t be d istu rbe d as itd o es n o t app ea r arb itrary
a n d c a p ric io u s e v e n th o u g h it m a yn o t co m p lyw ith its g e n e ra llya c c e p ted d e f in iti o n ” is aprop o s n o t onl yt o St

. D om ini c - Ja c ks on butal s o t he i ns t antcas e Id . a t 9 8 (R o b e rt s , J ., di s s ent i ng) ( emphasi s added)
. T odayt he maj or i t y , j us tas i n St . D om ini c- Jacks on , s t r i ps t he D e p a rtm e n t o f H e a lth o f its leg isla tiv e ly g ra n ted p o w e r to d e f in e “ re lo c a tio n .” T h e m a jo rity

a lso in h ib its th e D e p a rtm e n t’s a b ili ty to e v a lu a te S t. D o m in ic’ s ap p lica tio n f o r a c e rtific a te of nee d acc ording t o i t s ow n cr i t er i a, s peci fi cal l yt he “Cri t er i a and St andar ds for C o n stru cti o n , R en o v ati o n , E x p an sion , C ap it al Im p rov em en ts, R ep lace m en t of H ea lth C are Fa c i l i t i e s a n d Add i t i o n o f Hos p i t a l Be d s ( r e l o c a t i o n ) , ” b y ma n d a t i n g t h a t t h i s pr opos ed

### 18

hos pi t al r el ocat i on be eva l uat ed as a “ne w ” hos pi t al
. A s J us t i ce Robe rt s stat ed i n S t. D om ini c- Jacks on , “[i ] ti s notfort hi s C our tt o s ubs t i tut e i t s opi ni on fo rt he opi ni on of the B oar d [M SD H ] w her e t he B oar d [M SD H ] has r eac hed i t s deci s i on on confl i ct i ng evi dence

an d w her e i t s concl us i ons ar e s uppor t ed bys ubs t ant i al evi dence
. ” Id . a t 9 7 (R o b e rt s , J ., di s s ent i ng) ( quot i ng O hi o O il Co. v. P or ter , 2 2 5 M iss. 5 5 , 6 0 , 8 2 S o . 2 d 6 3 6 , 6 3 8 (19 5 5 )). I w o u ld def

er t o the H ea lth D ep artm en t’ s d ec isi o n to g ran t St. D o m inic’s ap p li ca ti o n fo r a C erti fica te of

N ee d , rev erse the c h a n c e llor’s j u d g m en t and reinstate the D ep artm en t’ s d e c is io n . ¶ 3 6
. F o r t h e s e re a s o n s , I r e s p e c tf u lly d is s e n t.