In re Unity Health Care

In the Matter of Unity Health Care, Class F Home License No. 352187 and Unity Home Care, Inc., Class A Professional Home Care License No. 353694.

A16-0682

STATE OF MINNESOTA IN COURT OF APPEALS

February 27, 2017

This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2016).

Affirmed; motion granted

Reilly, Judge

Minnesota Department of Health

File No. OAH #10-0900-30263

Lateesa T. Ward, Ward & Ward, P.C., Minneapolis, Minnesota (for relator Unity Health Care)

Lori Swanson, Attorney General, Audrey Kaiser Manka, Cody Zustiak, James P. Barone, Assistant Attorneys General, St. Paul, Minnesota (for respondent Commissioner of Minnesota Department of Health)

Considered and decided by Reilly, Presiding Judge; Connolly, Judge; and Bjorkman, Judge.

UNPUBLISHED OPINION

REILLY, Judge

Relator Unity Health Care challenges a final order by the commissioner of health (the commissioner) revoking its Class F home care license, refusing to renew its Class A home care license, and affirming fines imposed by respondent department of health (the department). Relator argues that: (1) Minn. Stat. § 144A.46, subd. 3(a) (2014),¹ is unconstitutionally vague and overbroad, and results in an unconstitutional taking; (2) the commissioner's order was made on unlawful procedure and contains errors of law; (3) the revocation is not supported by substantial evidence and is arbitrary and capricious; (4) the revocation is moot; (5) the refusal to remove a commissioner's representative as decision-maker was an abuse of discretion; and (6) the revocation is against public policy. For the reasons discussed below, we grant the commissioner's motion to strike portions of relator's brief and affirm the commissioner's order.

FACTS

Pursuant to Minn. Stat. § 144A.45, subd. 2 (2014), the department may monitor and inspect home health care providers to ensure providers are complying with applicable laws and regulations. As part of this process, the department may conduct impromptu on-site inspections of facilities, observations of staff and care providers, surveys of providers, interviews, and document review. Written correction orders are issued for violations of applicable statutes and rules, and the department specifies a time period in which the home care provider must correct the violation. Each written correction order includes one or more "tag numbers,"² cites the rule or law violated, and provides the factual basis for theissuance of the correction order. After the specified period passes, the department may conduct a follow-up visit to determine whether the violation has been corrected. If a facility fails to correct the violations within the specified period, the department is not required to provide an extension and may impose fines or penalties as it determines necessary.

In 2007, the department issued relator a Class F license to operate a home care facility and a Class A professional home care agency license. From 2007 to 2012, relator owned and operated four houses registered as housing with services establishments. See Minn. Stat. ch. 144D (2014). The department began conducting surveys of relator's houses in May 2011 and surveyed relator on multiple occasions in 2011, 2012, and 2013. Each survey resulted in the issuance of written correction orders. Following a survey conducted in May 2011, the department issued an immediate correction order for failure to comply with Minn. Stat. § 144A.44, subd. 1(2) (2010), which requires that all clients receive care that complies with accepted medical and nursing standards. In October 2011, the department imposed a conditional license, which restricted relator's authority to operate as a Class F and Class A home care provider and required that relator: (1) provide a list of all current clients to the department and refuse to admit new clients; (2) hire an independent consultant "to review, evaluate, and make recommended changes to the provider's practice [to] ensure that the licensee is in compliance with state laws and regulations governing home care practices, and submit weekly reports directly" to the department; (3) develop a written plan outlining the steps relator will take to ensure full compliance; and (4) notify clients, clients' care providers, and staff of the department's action against relator's license.

In an effort to comply with the conditional terms, relator hired Pathway Health Services, Inc. and Home Care Consultants. Pathway submitted weekly reports to the department, notifying the department of relator's continued improvements. In a February 2012 letter to the department, Pathway noted that it "can communicate with great confidence" that relator has "demonstrated full licensure requirements as outlined in [the department's] Plan of correction." Relying on this letter, relator requested that the department lift the conditional license. In a letter dated February 2012, the department denied relator's request, noting that it will not remove the conditional terms imposed until it may "make its own determination as to Unity's compliance status."

Despite relator's efforts to comply with the conditional-license terms, the department found numerous ongoing violations during the November and December 2011 surveys, the January and March 2012 surveys, and the June 2013 survey. In June 2012, the department notified relator of its intent to revoke relator's Class F license under Minn. Stat. § 144A.46, subd. 3(a), and deny renewal of relator's Class A license under Minn. R. 4668.0012, subpart 15, items A and C.

Relator requested a contested-case hearing before an administrative-law judge (ALJ) to challenge the department's decision. The contested-case hearing lasted over 30 days, beginning in September 2014 and ending in April 2015. Following the hearing, the ALJ issued findings of fact, conclusions of law, and a recommendation that the commissioner affirm the department's decisions to revoke relator's Class F license and deny renewal of its Class A license. The ALJ based his recommendation on the "imminent danger" and "serious health and safety risk" to relator's clients.

Relator then requested reconsideration of the ALJ's decision, and the commissioner upheld the department's revocation and nonrenewal of relator's licenses. This decision constituted the commissioner's final order. See Minn. Stat. § 14.61 (2014). Relator appealed and filed motions to stay enforcement of the commissioner's final order, and seeking reconsideration of the final order and reopening of the evidentiary record. The commissioner denied relator's motions.³

DECISION

The Minnesota Administrative Procedure Act governs the scope of this court's review and provides that a "person aggrieved by a final decision in a contested case is entitled to judicial review of the decision." Minn. Stat. § 14.63 (2014). An appellate court reviewing an agency decision may affirm, reverse, remand, or modify "the decision if the substantial rights of the petitioners may have been prejudiced" because the administrativedecision (a) violated a constitutional provision, (b) exceeded the agency's jurisdiction or statutory authority, (c) was based on unlawful procedure, (d) was affected by an error of law, (e) was unsupported by substantial evidence in view of the entire record as submitted, or (f) was arbitrary or capricious. Minn. Stat. § 14.69 (2014).

When reviewing agency decisions, this court recognizes that "decisions of administrative agencies enjoy a presumption of correctness." In re Minn. Power, 838 N.W.2d 747, 757 (Minn. 2013) (quotation omitted). And we defer to agencies' expertise and "special knowledge in the field of their technical training, education, and experience." Id. (quotation omitted). "While we review legal questions de novo, we review factual determinations made within the scope of the agency's statutory authority under the substantial evidence standard." Id.

I. The revocation of relator's home care license is constitutional.

When "evaluating challenges to the constitutionality of statutes, this court recognizes that the interpretation of statutes is a question of law." State v. Machholz, 574 N.W.2d 415, 419 (Minn. 1998) (quotation and citation omitted). Appellate courts presume Minnesota statutes are constitutional and therefore exercise the power to declare a statute unconstitutional only "with extreme caution and only when absolutely necessary." Id. (quotation and citation omitted). This court reviews constitutional challenges de novo, State v. Melchert-Dinkel, 844 N.W.2d 13, 18 (Minn. 2014), and the party challenging the statute bears the "burden of demonstrating beyond a reasonable doubt that the statute is unconstitutional." Machholz, 574 N.W.2d at 419 (quotation omitted).

Relator challenges the constitutionality of the commissioner's revocation action, arguing that Minnesota's home-care-licensure statute is vague and overbroad, and results in an unconstitutional taking.

Minnesota statutes section 144A.46, subdivision 3(a), provides:

The commissioner may refuse to grant or renew a license, may suspend or revoke a license, or may impose a conditional license for violation of statutes or rules relating to home care services or for conduct detrimental to the welfare of the consumer. . . . Terms for a suspension or conditional license may include one or more of the following and the scope of each will be determined by the commissioner:

(1) requiring a consultant to review, evaluate, and make recommended changes to the provider's practices and submit reports to the commissioner at the cost of the provider;

(2) requiring supervision of the provider's practices at the cost of the provider by an unrelated person who has sufficient knowledge and qualifications to oversee the practices and who will submit reports to the commissioner;

(3) requiring the provider or the provider's employees to obtain training at the cost of the provider;

(4) requiring the provider to submit reports to the

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