Case Name: REHABILITATION INSTITUTE, INC v. DEPARTMENT OF PUBLIC HEALTH
Court: Michigan Court of Appeals
Jurisdiction: Michigan
Decision Date: 1988-08-19
Citations: 173 Mich. App. 68
Docket Number: Docket No. 101323
Parties: REHABILITATION INSTITUTE, INC v DEPARTMENT OF PUBLIC HEALTH
Judges: Before: Doctoroff, P.J., and Holbrook, Jr., and C. Jobes, JJ.
Reporter: Michigan appeals reports; cases decided in the Michigan Court of Appeals.
Volume: 173
Pages: 68–71

Head Matter:
REHABILITATION INSTITUTE, INC v DEPARTMENT OF PUBLIC HEALTH
Docket No. 101323.
Submitted May 3, 1988, at Lansing.
Decided August 19, 1988.
Leave to appeal applied for.
After conducting a concurrent comparative review, which entailed review of applications for issuance of a certificate of need to convert hospital beds to rehabilitation purposes by plaintiff Providence Hospital and defendant Southfield Center, Inc., defendant Department of Public Health granted Providence’s application and denied Southfield’s application. After further administrative appeal proceedings and litigation in the Ingham Circuit Court, the department reconsidered and decided that concurrent comparative review was inappropriate, all previously approved applications, including that of Providence, remained valid, and all disapproved applications would be reconsidered on an individual basis. Thereafter, a certificate of need for rehabilitative services was issued to Southfield. Plaintiffs, Rehabilitation Institute, Inc., and Providence Hospital, brought an action in the Oakland Circuit Court against defendants, Department of Public Health and Southfield Center, Inc., doing business as Southfield Rehabilitation Center, alleging that various irregularities in the issuance of the certificate of need to Southfield require its invalidation. The circuit court, Robert C. Anderson, J., granted defendants’ motion for summary disposition on the ground that plaintiffs lacked standing to challenge Southfield’s certificate of need. Plaintiffs appealed.
The Court of Appeals held:
Plaintiffs did not have standing to challenge Southfield’s certificate of need awarded on a noncomparative basis. Only Southfield and the health systems agency charged with review _responsibilities for a certificate of need application have stand ing to challenge the department’s action concerning a certificate of need application by Southfield.
References
Am Jur 2d, Administrative Law §§ 575, 576.
Am Jur 2d, Parties §§ 30 et seq.
Validity and construction of statute requiring establishment of "need” as precondition to operation of hospital or other facilities for the care of sick people. 61 ALR3d 278.
Affirmed.
Health — Department op Public Health — Certificate of Need — Appeal — Standing.
Only the health care facility applying for a certificate of need and the health systems agency charged with review responsibilities for such applications have standing in circuit court to challenge action concerning the application taken by the Department of Public Health where such certificates are awarded on a non-comparative basis (MCL 333.22121[3], 333.22137[b], 333.22165; MSA 14.15[22121][3], 14.15[22137][b], 14.15[22165]).
John B. Curio, for Rehabilitation Institute, Inc., and Providence Hospital.
Frank J. Kelley, Attorney General, Louis J. Caruso, Solicitor General, and Marvin L. Bromley, Assistant Attorney General, for the Department of Public Health.
Cook, Pringle & Goetz, P.C. (by Susan Olin Baldwin), for Southfield Center, Inc.
Before: Doctoroff, P.J., and Holbrook, Jr., and C. Jobes, JJ.
Recorder’s Court judge, sitting on the Court of Appeals by assignment.

Opinion:
Per Curiam.
This case arises from a dispute between competing health care providers over the allocation of hospital beds effected by defendant Department of Public Health through its issuance of certificates of need (con). After conducting a concurrent comparative review, which entailed review of applications of both plaintiff Providence Hospital and defendant Southfield Center, Inc., defendant Department of Public Health granted Providence's application for a con to convert fifteen beds to rehabilitation purposes, but denied Southfield's similar request for seventy-five beds. After further administrative appeal proceedings and litigation in the Ingham Circuit Court, the department reconsidered and decided: (1) that concurrent comparative review was inappropriate, (2) that all previously approved applications, including that of Providence, remained valid, and (3) that all disapproved applications would be reconsidered on an individual basis. Thereafter, a con for seventy-five beds designated for rehabilitative services was issued to Southfield.
Plaintiffs filed a complaint in the Oakland Circuit Court alleging that various irregularities in the issuance of the con to Southfield requires its invalidation. The circuit court granted summary disposition in favor of defendants on the ground that plaintiffs lacked standing. Whether plaintiffs have standing to challenge Southfield's con is the sole question presented by this appeal. Since we agree with the circuit court's decision, we affirm.
The legislation providing for the con procedure does not explicitly or implicitly confer standing to a health care facility seeking to invalidate the grant of a con application to a competing facility. See MCL 333.22165; MSA 14.15(22165), MCL 333.22171; MSA 14.15(22171). In Pontiac Osteopathic Hospital v Dep't of Public Health, 157 Mich App 583; 403 NW2d 82 (1986), this Court was confronted with the same issue presented by this case. The plaintiff hospitals, after a denial of their applications for cons, challenged a decision to award a con to a competing health facility by instituting an action in circuit court, which was dismissed. This Court succinctly held:
Plaintiffs' challenges to the department's issuance of a certificate of need to Clarkston [the competing health care facility] were properly dis missed. Only Clarkston and the Comprehensive Health Planning Council [the health systems agency charged with review responsibilities for a con application] have standing to challenge departmental action concerning an application by Clarkston. MCL 333.22121(3), 333.22137(b), 333.22165; MSA 14.15(22121)(3), 14.15(22137)(b), 14.15(22165). [Id., pp 585-586.]
We agree with this holding and find it dispositive of the standing question presented in the instant case.
In passing, we note that plaintiffs' reliance on Huron Valley Hospital, Inc v State Health Facilities Comm, 110 Mich App 236; 312 NW2d 422 (1981), lv den 413 Mich 853 (1982), is misplaced. The decision in Huron Valley does not address an issue of standing. Unlike the instant case in which all interested parties were awarded a con on a noncomparative basis, the equal protection and due process claims in Huron Valley were premised on an allegation that the denial of the applicant's con and the concomitant grant of a mutually exclusive con to a competing facility effectively allocated scarce, limited rights to that facility at the expense of the appealing applicant.
Affirmed.