Court Opinion

ID: 9577551
Source: CourtListenerOpinion
Date Created: 2023-08-21 21:36:00.013001+00
Date Added: 2024-06-11T13:20:48.665614
License: Public Domain

Hunter, J.
(dissenting)—I dissent. The majority admits that neither the due process clause nor the impairment of contract clauses of our state and federal constitutions override the power of the state to establish regulations that are reasonably necessary to secure the health, safety, good order, comfort or general welfare of the community. But they hold there is no rational connection between the accomplishment of the purpose and the means employed by the legislature’s passage of that section of the act in question, RCW 48.44.010, and that this constitutes an unreasonable exercise of the police powers. I disagree.
The test to be applied in prescribing the police power, and which should be applied in this case, was stated in State v. Laitinen, 77 Wn.2d 130, 459 P.2d 789 (1969), at 132:
In prescribing the police power, all that is constitutionally required of the legislature is that a state of facts can reasonably be conceived to exist which would justify the legislation. If the courts can reasonably conceive of such a state of facts, they must presume that such facts actually did exist and that the statute being tested was passed with reference to them. Shea v. Olson, 185 Wash. 143, 53 P.2d 615, 111 A.L.R. 998 (1936); State v. Dexter, 32 Wn.2d 551, 202 P.2d 906, 13 A.L.R.2d 1081 (1949); Clark v. Dwyer, 56 Wn.2d 425, 353 P.2d 941 (1960), cert. denied, 364 U.S. 932, 5 L. Ed. 2d 365, 81 S. Ct. 379 (1961); Treffry v. Taylor, 67 Wn.2d 487, 408 P.2d 269 (1965), appeal dismissed, 385 U.S. 10, 17 L. Ed. 2d 10, 87 S. Ct. 70 (1966).
Accordingly, if a state of facts can reasonably be conceived that will sustain a classification under the police power, there is a presumption that such facts exist. Ace Fireworks Co. v. Tacoma, 76 Wn.2d 207, 455 P.2d 935 *584(1969); State v. Persinger, 62 Wn.2d 362, 382 P.2d 497 (1963); Shea v. Olson, supra. It is not the court’s function to decide whether the statute is sound or unsound, wise or unwise, effectual or ineffectual—but only whether it is within -the legislature’s constitutional powers to enact it. This comports with the general democratic principle that powers of self-government have been largely reserved by the people to be exercised through their legislatures and not their courts.
Applying these general principles to the act before us, it seems clear to me that the Laws of 1969, ch. 143, constitutes a reasonable exercise of the state’s police power and is reasonably related to the public health, safety 'and welfare. Health care services 'and agreements pertaining thereto have long been subject to state regulation under the Health Care Services Act (Laws of 1947, ch. 268, p. 1149-52; and amended by Laws of 1961, ch. 197, Laws of 1965, ch. 87, and Laws of 1969, ch. 115). Under this act, the service contractors and their activities have been regulated since 1947, and are. subject to future legislative controls in the interest of public health and safety. Additionally, the defendant optometrists- are licensed and regulated by the state under RCW 18.53. The new act is an addition to an already established area of regulated public activity. Its enactment is entirely within the legitimate exercise of the police power of the state legislature and the act is entitled to presumptive constitutional validity.
I am convinced that a state of facts can reasonably be conceived to exist that the act is reasonably related to and is in the interest of the public health and welfare. The defendant service contractors are engaged in activities providing for medical, surgical and health care services to large groups of persons. The record indicates that their comprehensive prepaid health insurance plans cover thousands of persons in the state of Washington. Dr. Bertram Fitzmaurice, president and medical director of King County Medical Service Corporation, testified that his company alone had approximately 1,700 group contracts and 39,000 individual contracts-in existence,'covering a total of about *585287,000 persons in King County. The plans of the other service contractors cover additional large numbers of persons. Laws of 1969, ch. 143, by its terms, becomes a part of any agreement whereby a service contractor provides for vision care. Looking at the objectives and purposes of the legislation, it is apparent that it was intended to give mandatorily to the subscribers the right of reimbursement for covered vision care whether such service is performed by a doctor of medicine or a licensed optometrist. The legislative purpose in enacting this provision could well have been to afford a freedom of choice to the many thousands of subscribers as between ophthalmologists and optometrists, either participating or nonparticipating, for that vision care which is covered in the contract and which both provide.
Further, under the provisions of the act there will be a greater availability of vision care to the subscribers. By reimbursement of the services of optometrists for covered vision care, the subscriber has a greater opportunity of obtaining vision care than if it were limited to ophthalmologists. It is reasonable to assume, therefore, that the legislation is in the interest of and will benefit the public health.
It is contended that the act is invalid for the reason that the act deprives the physician participant in the contract of vested property rights without due process of law. It is claimed that the act denies the ophthalmologists the benefit of their bargain in that it provides for' payment to nonparticipating optometrists, thus destroying any benefit which the plaintiffs gain by entering into the contract. I do not agree.
The basic formula utilized by all the service contractors is a tri-party contractual arrangement between the service contractors, the participant doctors of medicine, and the subscribers. The subscribers, who are by far the largest beneficiary in number under the contracts, are not challenging the legislation, nor are the defendant service contractors. It is only the plaintiff ophthalmologists who feel aggrieved.
It is my opinion that the plaintiffs will retain all, or *586substantially all, of the benefits of their bargain, notwithstanding the new enactment. The act will not add any new services to the coverage. It merely provides that if vision care is covered by the service contractors, the subscribers will be reimbursed whether that service is provided by a participant ophthalmologist or an optometrist. The plaintiffs may still look to the fund established by the service contractors for payment of their fees. The optometrist will receive no more payment from the fund for his services than the ophthalmologist receives for providing that vision care which both the optometrist and ophthalmologist are qualified to render. Since the fees charged the subscribers are adjusted by the service contractors to maintain the fund, the plaintiffs will not be harmed by payments to nonparticipant optometrists. The plaintiffs may still have their names appear on a list of medical doctors to whom the subscribers are directed when they seek medical and/or surgical attention. And the new act will not change the plaintiffs’ membership in an association dedicated to the providing of low cost, prepaid medical and health care services to the public through its subscribers.
It is significant that the plaintiffs knew when they entered into these health care service contracts that it was a highly regulated field of activity. RCW 48.44.020 specifically provides in part:
(2) The commissioner [Insurance Commissioner] may require the submission of contract forms for his examination and may on examination, subject to the right of the health care service contractor to demand and receive a hearing under chapters 48.04 and 34.04 RCW, disapprove any contract form for 'any of the following grounds:
(a) If it contains or incorporates by reference any inconsistent, ambiguous or misleading clauses, or exceptions and conditions which unreasonably or deceptively affect the risk purported to be assumed in the general coverage of the contract; or
(b) If it has any title, heading or other indication of its provisions which is misleading; or
(c) If purchase of health care services thereunder is being solicited by deceptive advertising; or
*587(d) If, the benefits provided therein are unreasonable in relation to the amount charged for the contract; orj
(e) If it contains unreasonable restrictions on the treatment of patients.
(Italics ours.) RCW 48.44.015 requires any person who holds himself out to be a health care service contractor to register with the commissioner. RCW 48.44.030 requires certain indemnity agreements. RCW 48.44.040 requires every health care service contractor, who enters into agreements which require prepayment for health care services, to register with the insurance commissioner, and it further provides for filing of the rate schedules. RCW 48.44.050 authorizes the insurance commissioner to make reasonable regulations in aid of the administration of the chapter. RCW 48.44.060 makes a violation of any of the provisions of the chapter a gross misdemeanor. RCW 48.44.070 requires forms of contracts between health care service contractors and participants to be filed with the insurance commissioner prior to use. Other provisions of the Health Care Services Act contain additional regulations relating to health care services.
The above provisions in the Health Care Services Act make it abundantly clear that the plaintiffs had notice of the right of the legislature, in the exercise of its police power, to enact reasonable modifications of the Health Care Services Act affecting their contracts, in furtherance of the purposes of the act. This legislative right is implicitly a part of the contract agreements between the parties.
The plaintiffs’ freedom of contract, moreover, is preserved since they are permitted to withdraw from the contracts with the service contractors with little or no notice under the terms of the contracts.
For the reasons heretofore stated, this court should hold that Laws of 1969, ch. 143, p. 504-05, is a valid exercise of the police power, is reasonably related to the public health and safety, and is not a violation of federal or state due process standards.
The judgment of the trial court should be reversed.
Finley, J., concurs with Hunter, J.