IT IS ORDERED, SUA SPONTE:
1. Opinion No. 4198, issued on May 12, 1995, is WITHDRAWN.
2. Opinion No. 4210, in which footnote # 17 at page 20 has been modified, is issued today in its place.
Entered by direction of the court at Anchorage, Alaska on May 19, 1995.
Before MOORE, C.J., and RABINOWITZ, MATTHEWS, COMPTON and EASTAUGH, JJ.
Members of an organization called Chiropractors for Justice (CFJ) assert that the Alaska Workers' Compensation Act frequency-of-treatment statute and the corresponding regulation violate their federal and state guarantees of due process, equal protection and privacy. The superior court rejected CFJ's claims. We affirm.
II. FACTS AND PROCEEDINGS
In 1988, as part of a comprehensive revision of the Alaska Workers' Compensation Act (Act), the Alaska Legislature adopted new procedures for payment of workers' compensation benefits for "continuing and multiple treatments of a similar nature." AS 23.30.095(c).
The 1988 amendments also required the Board to adopt regulations establishing standards for frequency of treatment. Id. In response, the Board promulgated 8 Alaska Administrative Code (AAC) 45.082(f), which sets the standard for the maximum number of compensable treatments permitted without Board approval, and 8 AAC 45.082(g), which sets the procedure for Board approval of treatments exceeding the frequency standards.
In 1990 CFJ filed suit against the State of Alaska (State), challenging AS 23.30.095(c) and 8 AAC 45.082(f) and (g). CFJ claimed the statute and the regulation violated its
A. Standard of Review
In reviewing a grant of summary judgment, we determine whether a genuine issue of material fact exists and, if not, whether the moving party is entitled to judgment as a matter of law. Gilbert v. State, Dep't of Fish and Game, 803 P.2d 391, 394 (Alaska 1990). We consider matters of law de novo and adopt the rule of law which is most persuasive in light of precedent, reason and policy. Id. Constitutional questions are also questions of law to which we apply our independent judgment. Municipality of Anchorage v. Leigh, 823 P.2d 1241, 1243 n. 5 (Alaska 1992).
B. Substantive Due Process
CFJ argues that AS 23.30.095(c) and 8 AAC 045.082(f) and (g) violate substantive due process because the frequency standard in 8 AAC 45.082(f) is arbitrary, bearing no fair and substantial relationship to a legitimate government purpose.
We have previously held:
Municipality of Anchorage v. Leigh, 823 P.2d at 1244 (quoting Concerned Citizens of South Kenai Peninsula v. Kenai Peninsula Borough, 527 P.2d 447, 452 (Alaska 1974)). See also Alaska Int'l Indus., Inc. v. Musarra, 602 P.2d 1240, 1245 n. 9 (Alaska 1979) ("It is established that, in refusing to substitute its judgment for that of the administrative agency as to the efficacy of the regulation, this court will decline to review the `wisdom' of a particular regulation.").
As the State argues, it had a legitimate interest in curbing abuse by health providers and claimants, discouraging needless or fruitless treatments, saving jobs by reducing workers' compensation premiums and, in general, ensuring the delivery of reasonable and necessary medical benefits to injured workers. Reducing amounts spent needlessly on health care also potentially translated to increased disability benefits for injured workers. Legitimate public purposes thus justified action by the legislative and executive branches of government.
Further, the State's action bears a reasonable relationship to those legitimate governmental purposes. There is a logical connection between limiting the process by which physicians and health care providers receive payment for repetitive, similar and frequent treatments and the legitimate governmental purposes noted above. A substantial relationship exists between the frequency standards and the State's objective of "ensur[ing] the quick, efficient, fair, and predictable delivery of indemnity and medical benefits to injured workers at a reasonable cost to the employers." Ch. 79, § 1, SLA 1988.
Moreover, information in the record supports adoption of frequency of treatment standards of the sort promulgated in 8 AAC
CFJ also cites a House Labor and Commerce Committee memorandum and affidavits by two members of the Governor's Oversight Group, criticizing a proposed bill which had included a frequency standard of twenty visits in the first sixty days — the exact number to be set by the Board in 8 AAC 45.082(f) — because "the provision impose[d] maximum limits arbitrarily." That history, however, cannot establish whether the legislature as a body considered such frequency limits to be arbitrary. See 2A Norman J. Singer, Sutherland Statutory Construction § 48.13, at 356 (5th ed. 1992 rev.) ("[I]t is impossible to determine with certainty what construction was put upon an act by the members of the legislative body that passed it by resorting to the speeches of individual members thereof. Those who did not speak may not have agreed with those who did; and those who spoke might differ from each other.") (quoting Peckham, J., in United States v. Trans-Missouri Freight Ass'n, 166 U.S. 290, 318, 17 S.Ct. 540, 550, 41 L.Ed. 1007 (1897)).
Furthermore, the challenged regulation does not prohibit compensation for treatments whose frequency exceeds the standard; it merely requires the treating health care provider to meet the procedural prerequisites to receive payment for those treatments.
At least one other state has upheld frequency standards on this basis. See Kemp v. Workers' Compensation Dep't, 65 Or.App. 659, 672 P.2d 1343 (1983), modified on other grounds, 67 Or.App. 270, 677 P.2d 725 (1984). In Kemp, the court held valid a frequency standard which provided for twenty-four office visits within the first sixty days and four visits per month thereafter, and which required that, upon request, physicians requesting reimbursements for visits in excess of that standard submit a plan of treatment containing objectives, measurement indicators, modalities, and frequency of treatments. Id. at 1344-45 & n. 1. The court stated:
Id. at 1345-46. Thus, the court concluded that the rule was valid insofar as it only required submission of a report justifying treatments in excess of the frequency standard.
We conclude that the statute and the regulation bear a reasonable relationship to a legitimate governmental purpose. We also note that there was factual support for the statute and regulation. We consequently reject CFJ's substantive due process challenge to the statute and the regulation.
C. Equal Protection
1. Sliding scale of review
CFJ argues that AS 23.30.095(c) and 8 AAC 45.082(f) and (g) violate Article I, section 1 of the Alaska Constitution because they unlawfully discriminate against chiropractors.
In analyzing equal protection issues, we employ a "sliding scale of review ranging from relaxed scrutiny to strict scrutiny." State v. Ostrosky, 667 P.2d 1184, 1192-93 (Alaska 1983). In applying the sliding scale analysis, this court proceeds through three distinct analytic stages:
Alaska Pacific Assur. Co. v. Brown, 687 P.2d 264, 269-70 (Alaska 1984) (citations omitted).
2. Applying the sliding scale analysis
a. Constitutional interest/level of scrutiny
CFJ argues that the statute and regulation infringe on a fundamental interest, the physician-patient relationship, and consequently require a "very high level of justification." See Falcon v. Alaska Public Offices Comm'n, 570 P.2d 469, 476 (Alaska 1977). The State responds that they affect only an economic or commercial interest, and are therefore only subject to the lowest level of scrutiny. See Herrik's Aero-Auto-Aqua Repair v. Dep't of Transp., 754 P.2d 1111, 1114 (Alaska 1988) (citing Isakson v. Rickey, 550 P.2d 359, 363 (Alaska 1976) (noting that legislation of economic and commercial interest is traditionally subject to the lowest level of scrutiny)).
As the State correctly notes in its brief, the most precise description of the constitutional interest implicated here is "the right of a health care provider to receive payment under the Workers' Compensation Act for continuing multiple treatments in excess of the frequency standards without administrative review." The regulation does not interfere with the doctor-patient relationship. It merely prescribes the procedures under which a physician may seek payment under the Act. Thus, the interest at issue is merely an economic one, entitled to the minimum level of judicial scrutiny.
CFJ argues that, at the very least, the interest implicated here should be characterized as "important" because the care providers' right to engage in an economic endeavor in a particular industry is threatened. In State v. Enserch Alaska Constr., Inc., 787 P.2d 624, 633 (Alaska 1989), we held that although a statute providing that a hiring preference be given to residents of economically distressed zones for contracts involving public works projects did not result in a total deprivation of employment, it nevertheless impaired "the important right to engage in economic endeavor," thereby requiring us to "closely scrutinize the law." Id. The interest asserted in Enserch, however, is different from the one asserted here.
The statute in Enserch completely foreclosed some members of a class of persons from participating in an economic endeavor. In contrast, the statute and regulation challenged here do not prohibit chiropractors from treating or contracting with any patient. The only interest implicated here is economic, and does not rise to the level of the interest asserted in Enserch. We consequently apply the minimum level of judicial scrutiny to the statute and regulation.
b. Purposes furthered by the statute and regulation
Because CFJ's interest is entitled only to a minimal level of constitutional protection, in the second stage of the equal protection analysis the State must show only that its objectives were legitimate. Brown, 687 P.2d at 269. We consider the challenged provisions in light of the purposes of the entire Act and the 1988 amendments. Taylor v. Southeast-Harrison Western Corp., 694 P.2d 1160, 1162 (Alaska 1985).
The State asserts that the legislature's intent in enacting AS 23.30.095(c) is clear. In Leigh we concluded that the legislature's intent
Leigh, 823 P.2d at 1244-45 (citing Ch. 79, § 1, SLA 1988 and adding emphasis). See also Rydwell v. Anchorage School Dist., 864 P.2d 526, 530 (Alaska 1993). This purpose comports with the overall purpose of the Act, "the provision of financial and medical benefits for victims of work-connected injuries in the most efficient, most dignified, and most certain form." Arctic Structures, Inc. v. Wedmore, 605 P.2d 426, 437 (Alaska 1979).
The State maintains that ample evidence in the record supports the premise that the legislature's intent in enacting the frequency standards was to further the overall legislative policy of providing medical benefits to injured workers at a reasonable cost to employers.
The State maintains that in an attempt to meet the concerns regarding rising workers' compensation costs, the legislature enacted AS 23.30.095(c) and the Board subsequently promulgated 8 AAC 45.082(f) and (g), establishing additional standards and procedures to eliminate unnecessary treatment.
The record as a whole nonetheless supports the legislative statement of purpose. The record contains evidence supporting the State's contention that the legislature's main purpose in enacting the frequency standards was to ensure the delivery of medical services at "a reasonable cost to the employers," and not to discriminate against chiropractors. John Lewis' testimony, although questioned to some extent by CFJ,
CFJ relies on Brown, 687 P.2d 264, to argue that the State's interest in reducing costs is invalid. In Brown, we held that a statute adjusting benefits of workers' compensation recipients who move out of state was unconstitutional. In particular, we held that,
Brown, 687 P.2d at 272 (footnote omitted).
CFJ's reliance on Brown is misplaced. Unlike the situation in Brown, the statute and regulation here are not designed to reduce costs by depriving a certain class of persons, e.g., chiropractors, of benefits they would otherwise receive. Rather, they are designed to reduce costs by curbing perceived abuses through procedural safeguards. Chiropractors may be paid for frequent treatments by adhering to the regulation and demonstrating that the treatments are reasonable and necessary. The purpose here was to ensure that employers are liable only for reasonable and necessary medical costs. See ch. 79, § 1, SLA 1988 and AS 23.30.265(20).
c. Nexus between the means and the ends
When the interest affected is entitled to only minimal judicial protection, the State need only show that the distinction
CFJ's arguments regarding the third step in the equal protection analysis overlap its substantive due process claims. See Leigh, 823 P.2d at 1247 n. 15. For the same reasons discussed above in rejecting CFJ's substantive due process claim, we conclude that the provisions do not violate the constitutional guarantee of equal protection. The challenged provisions bear a fair and substantial relationship to the State's objective of "ensur[ing] the quick, efficient, fair and predictable delivery of indemnity and medical benefits to injured workers at a reasonable cost to the employers." Ch. 79, § 1, SLA 1988 (emphasis added).
CFJ next argues that the provisions violate privacy rights on the theory they unconstitutionally infringe upon the physician-patient relationship. CFJ relies primarily on Falcon v. Alaska Public Offices Comm'n, 570 P.2d 469, 480 (Alaska 1977), where we held unconstitutional a statute requiring physicians running for public office to disclose the names of their patients for the purpose of discovering conflicts of interest.
The physician-patient relationship is invaded by these provisions only to the extent necessary to administer the workers' compensation program. The right to privacy is not absolute. Rather, "it is part of the judicial function to ensure that governmental infringements of this right are supported by sufficient justification." Id. at 477. The State must be able to investigate the validity of a health care provider's claim for payment under the Act if the State is to administer effectively the benefits program. As this court has previously held, "there must be ... a balancing of conflicting rights and interests." Messerli v. State, 626 P.2d 81, 83 (Alaska 1980). Here, the balance clearly weighs in favor of the State's interest in preventing fraud and abuse in the worker's compensation system.
It is also difficult to comprehend any limit to CFJ's privacy argument. There is no
E. Presumption of Compensability
Finally, CFJ argues that 8 AAC 45.082(g) violates the "presumption of compensability" contained in AS 23.30.095(a). CFJ asserts that by requiring the employee to prove that "the treatments improved or are likely to improve the employee's conditions," 8 AAC 45.082(g)(2) nullifies the presumption by shifting responsibility to the employee to establish justification for payment.
CFJ's argument is without merit. AS 23.30.095(a) does not guarantee unlimited medical benefits regardless of whether the treatments are beneficial. The Act is intended to provide medical and related benefits "as may reasonably be required which [arise] out of or [are] necessitated by an injury." AS 23.30.265(20). The statute containing the "presumption" cited by CFJ only requires the employer to furnish "treatment ... for the period which the nature of the injury or the process of recovery requires... ." AS 23.30.095(a). An employer is not required to furnish treatments which are unreasonable or unnecessary. The provisions under attack do not limit compensability; they merely establish a mechanism by which the Board may monitor the reasonableness of the treatments.
In any event, having enacted AS 23.30.095(a) in the first place, the legislature had the power to narrow any presumption found in that subsection when it enacted AS 23.30.095(c) in 1988 and required the Board to adopt frequency of treatment standards. Leigh, 823 P.2d at 1246-47.
For these reasons, we conclude that the superior court correctly denied summary judgment to CFJ and correctly granted summary judgment to the State upholding AS 23.30.095(c) and 8 AAC 45.082(f) and (g). We therefore AFFIRM the judgment of the superior court.
AS 23.30.095(c) (emphasis added to indicate 1988 amendments).
8 AAC 45.082(g) provides:
In Anchorage Sch. Dist. v. Hale, 857 P.2d 1186 (Alaska 1993), we held that 8 AAC 45.082(f) was consistent with and thus authorized by AS 23.30.095(c).
Because the substance of neither source is contained in the record, we cannot conclude that the Board's reliance on either was unwarranted. However, CFJ's brief sets out Dr. Olson's "typical chiropractic treatment pattern." That pattern is remarkably similar to the frequency standards adopted by the Board, and thus clearly supports the regulation. See 8 AAC 45.082(f). Dr. Olson subsequently objected to the Board's use of his book for purposes of adopting the regulation, but his objection post-dated adoption of the regulation. Even if the Board had known of Dr. Olson's objections, it could have concluded that Dr. Olson's treatment pattern was relevant to the question of appropriate frequency standards.
823 P.2d 1241, 1244 n. 8 (citing 1988 Senate Journal 2420). This court further noted that "[a] report of the Workers's Compensation Labor-Management Task Force also chronicled the increase in workers' compensation insurance costs" and that "[t]his task force was resurrected in 1986, following a rate increase by the Department of Workers' Compensation Insurance `with the purpose of reducing rates paid by employers through legislative changes to the Statute.'" Id. (quoting Workers' Compensation Labor-Management Task Force, Synopsis of Proposed Legislative Changes to Chapter 30 of Title 23, at 1).
Neither CFJ nor the State is entirely correct. CFJ's allegations regarding a bias against chiropractors are relevant, but only to the extent that they undermine the State's contention that the purpose of the amendment and related regulation is legitimate, i.e., to control costs, and not merely to pursue an economic assault on chiropractors. In addressing this issue, this court must bear in mind that "[w]hen a law has been enacted, the legislature has spoken as a whole." Lynden Transport, Inc. v. State, 532 P.2d 700, 716 (Alaska 1975). Thus, the general purpose behind the statute and regulation is at issue, not the respective motives of individual drafters.
In Turner, we invalidated a statute barring legal action against design professionals such as architects, engineers and contractors more than six years after substantial completion of an improvement to real property. 752 P.2d at 472. We held that "there is no substantial relationship between exempting design professionals from liability, shifting liability for defective design and construction to owners and material suppliers, and the goal of encouraging construction," because the shift in liability actually provides a disincentive to owners to finance construction as the owners would be subjected to liability for a product over which they had no control. Id.