Blue Cross and Blue Shield v. Hodurski
Blue Cross and Blue Shield v. Hodurski
Dissenting Opinion
I dissent. Blue Cross and Blue Shield of Alabama ("BCBS") argues that in order for nonstock corporations organized pursuant to Article 6 of Chapter 4 of Title 10 of the Alabama Code of 1975 ("Title 10 insurers") to be subject to insurance statutes, the Legislature must expressly amend §
"This title [Title 27] shall not apply as to:
". . . .
"(2) Nonprofit corporations for establishment of hospitalization plan [sic] under Section
10-4-100 et seq., except to the extent now or hereafter provided in such laws. . . ."
BCBS argues that because when it enacted the Physician Assistant Act the Legislature did not expressly amend §§
BCBS relies upon Blue Cross Blue Shield of Alabama v.Nielsen,
The plaintiffs in Nielsen I appealed and, on appeal, the United States Court of Appeals for the Eleventh Circuit (seeBlue Cross Blue Shield v. Nielsen,
Nielsen III,"Based upon our reading of these two Code provisions [§
10-4-115 and §27-1-4 ], and applying the principles of statutory construction heretofore adopted by this Court, we conclude that the language of §10-4-115 plainly and unambiguously states that corporations formed under §10-4-110 et seq., as [BCBS] was, are not regulated by the insurance laws of this State unless §10-4-110 et seq. are expressly amended to apply such laws. This interpretation is also supported by the wording of §27-1-4 , which expressly states that laws appearing in the Alabama Insurance Code (Title 27) do not apply to companies, like [BCBS], that are organized under the provisions of §10-4-100 , unless §10-4-100 et seq. expressly provide that such laws apply."It is a familiar principle of statutory interpretation that the Legislature, in enacting new legislation, is presumed to know the existing law. Applying that principle to this case, we can presume that if the Legislature had intended for §
27-1-19 and §§27-19A-1 to -11, and §§27-45-1 to -9 to apply to companies like [BCBS], it could have eliminated any question by expressly amending §10-4-100 et seq. to specify that those statutes would, in fact, apply. Based on the foregoing, we conclude that [BCBS] is exempted from the [Assignment Act, the Dental Act, and the Pharmacy Act] by the provisions of §10-4-115 and §27-1-4 . The Court of Appeals' first question is answered in the affirmative."
BCBS also argues that the summary judgment in favor of Dr. Hodurski and the physician assistants cannot be supported on a theory of an implied repeal. I agree. In Shiv-Ram, Inc. v.McCaleb,
"This Court stated in Fletcher [v. Tuscaloosa Fed. Sav. Loan Ass'n,
294 Ala. 173 ,176-77 ,314 So.2d 51 (1975)]:"`Repeal by implication is admittedly not a favored rule of statutory construction, but in State v. Bay Towing and Dredging Company,
265 Ala. 282 ,289 ,90 So.2d 743 ,749 (1956), we find:"`"In Alabama, the law governing implied repeals is well-settled and the cases on this point are singularly consistent. . . .:
"`"`Repeal by implication is not favored. It is only when two laws are so repugnant to or in conflict with each other that it must be presumed that the Legislature intended that the latter should repeal the former. . . .'
"`"Implied repeal is essentially a question of determining the legislative intent as expressed in the statutes. When the provisions of two statutes are directly repugnant and cannot be reconciled, it must be presumed that the legislature intended an implied repeal, and the later statute prevails as the last expression of the legislative will."'"
(Citations omitted.) See also Brown v. Board of Educ. ofMontgomery County,
In this case, the exemption statutes are the earlier enacted statutes. The Physician Assistant Act is the subsequently enacted statute. After reviewing the express language of the Physician Assistant Act, I am convinced that the Physician Assistant Act continues to have a field of operation (although admittedly a small one), even after Title 10 insurers are exempted from the reach of that Act. Second, even after the Physician Assistant Act was enacted and codified, three subsequently convened legislatures amended §
I also disagree with the trial court's conclusion that because §
The Physician Assistant Act applies to "an individual or group health maintenance organization, an organized delivery system, a medical service organization created pursuant to Article 6, Chapter 4, Title 10, or a preferred provider organization or arrangement. . . ." The Act requires that all of the listed organizations provide payments for certain services rendered by physician assistants.
In comparison, §
I would conclude that the analysis applied by the Alabama Supreme Court in Nielsen III, supra, is binding and persuasive. It must be presumed that when the Legislature enacted the Physician Assistant Act it knew of the statutory requirements for making that Act applicable to BCBS. For whatever reason, it did not comply with those requirements. This Court cannot presume to know the reasons for that noncompliance, and there is no obvious indication of the Legislature's intent in not complying. The Legislature did not expressly repeal the exemption statutes, and it did not expressly amend §
I also disagree with the third basis of the trial court's summary-judgment order in favor of Dr. Hodurski and the physician assistants. In its order, the trial court stated:
"Third, and most importantly, no earlier legislature can bind a later legislature to any requirement that its enactments must be in any particular title of the Code in order to be effective. [BCBS] cannot avoid compliance with the P.A. [Physician Assistant] Statute (i.e., the P.A. Statute says it applies to Title 10 [insurers] like [BCBS]) on the theory that the later legislature which enacted the P.A. Statute had to also go back and amend Alabama Code §
10-4-115 . To the extent that [BCBS] argues that the legislature was required to amend §10-4-115 , or to do anything more than say straight-out in the P.A. Statute that the statute applies to Title 10 [insurers] — which the legislature certainly did — then [BCBS's] argument runs afoul of the Alabama Constitution. *Page 966 Under Alabama law it is exceptionally clear that an earlier legislature cannot bind a later legislature, and that a later legislature always has power to overrule an earlier legislature in any and every respect, unless some kind of vested right has intervened (which is not an issue here). Alabama Power v. Citizens of Alabama,740 So.2d 371 (Ala. 1999) (`No legislature can forestall action by a succeeding legislature.'); John E. Ballenger Construction Company v. State Board of Adjustment,234 Ala. 377 ,175 So. 387 (1937) (`One legislature's action cannot bind another.'); Newton v. State,375 So.2d 1245 (Ala.Crim.App. 1979) (`One legislature cannot bind a succeeding legislature or restrict or limit the power of its successors to enact legislation.')."This is a matter of Alabama constitutional law. The legislative power is vested in the legislature, and each new legislature is a separate session. Ala. Const. §§
44 and48 . So long as the legislature passes its laws in the form required by the Alabama Constitution (e.g., Ala. Const. §45 ), the legislature may pass its laws to amend or replace any title it wishes to amend or replace; and it does not have to do it in Title 10 rather than in Title 27 just because an earlier legislature said so. Whether the legislature in 1997 decided to apply the P.A. Statute to [BCBS] by stating in Title 27 that the P.A. Statute applies to Title 10 [insurers] (which is what the legislature did), or whether the legislature in 1997 had passed the P.A. Statute and made it silent as to whether it applied to [BCBS] yet amended Title 10 to indicate that the P.A. Statute applies to Title 10 [insurers] (which the legislature did not do), is a question for the legislature to decide and not the courts. Under the Alabama Constitution, the legislative power is vested in the legislature (Alabama Constitution §44 ) and it is not vested in the courts (in Ala. Const. §42 ), and under the Alabama constitutional doctrine of separation of powers it is up to the legislature and not the courts how the legislature does its legislative business, so long as the Alabama Constitution is followed. Alabama Constitution §42 ; Ex parte Governor Fob James,836 So.2d 813 (Ala. 2002)."
The Nielsen III Court rejected an argument identical to the one relied upon by the trial court. The Nielsen III Court rejected the same argument presented by the providers here — that the exemption statutes imposed an additional requirement for the enactment of legislation and that such a requirement conflicted with the legislative procedure established by the Alabama Constitution. Nielsen III,
"Section
10-4-115 merely requires that if the Legislature is intending to change the provisions of §10-4-100 [et seq.], then the legislation that makes that change must explicitly show that intention; this requirement is consistent with the requirements of § 45 of the Constitution for providing notice of the purposes of an Act."
As discussed above, the Legislature in 1997 did not explicitly express its intention to make the Physician Assistant Act applicable to BCBS. I also disagree with the trial court's application of the recited principles of constitutional law, for a different reason. The trial court's conclusion is premised upon its belief that the exemption statutes somehow improperly restricted the power of the 1997 Legislature and that the 1997 Legislature therefore was empowered to disregard those statutes. The trial court also concluded that the issue how to make the subsequent legislation *Page 967 applicable to BCBS was for the Legislature, not the courts, to decide.
I recognize that the 1997 Legislature, like any other legislature, was vested with the power to, among other things, enact statutes. This is exactly what the 1939 Legislature did when it enacted §
However, both exemption statutes were existing, validly enacted statutes at the time the 1997 Legislature chose to address, among other things, Title 10 insurers by enacting the Physician Assistant Act. The exemption statutes provided express instructions to the 1997 Legislature as to how to make insurance statutes apply to Title 10 insurers, but the 1997 Legislature chose not to follow those instructions. Had the 1997 Legislature wished to make the Physician Assistant Act applicable to BCBS, it could have followed the instructions provided in §
However, the power granted to a legislature under the Constitution of Alabama does not include the freedom from judicial review if the legislature disregards an existing statutory mandate and enacts legislation that conflicts with an existing statute. If a legislature acts in that manner, the Court must apply principles of statutory construction to resolve the resulting conflict.
Dr. Hodurski has raised legitimate concerns in support of his position. For example, Dr. Hodurski presented evidence indicating that BCBS is responsible for 70 to 85% of the private health-insurance market in Alabama. Dr. Hodurski also presented evidence indicating that there is a critical shortage of primary care doctors in Alabama, that physician assistants are capable of performing many of the same functions a primary care doctor performs but at a lower cost, and that the Legislature enacted the Physician Assistant Act in order to increase access to health care for the citizens of Alabama. Dr. Hodurski also presented evidence indicating that the majority of the physician assistants who are trained at universities in Alabama seek employment outside of the state because of financial considerations. Finally, Dr. Hodurski produced evidence tending to indicate that BCBS's policy of not reimbursing the costs of services rendered by physician assistants is a factor contributing to this problem. Regardless of whether we agree with Dr. Hodurski's characterization of the evidence and the necessity for mandated coverage for physician assistants, the Legislature is the proper governmental body to address the policy considerations Dr. Hodurski raises. I would reverse the judgment of the trial court and remand the cause for the entry of a judgment in favor of BCBS. Therefore, I dissent.
SEE, J., concurs.
Dissenting Opinion
In Blue Cross Blue Shield of Alabama, Inc. v. Nielsen,
"[W]e conclude that the language of §
10-4-115 plainly and unambiguously states that corporations formed under §10-4-110 et seq., as [BCBS] was, are not regulated by the insurance laws of this State unless §10-4-110 et seq. are expressly amended to apply such laws. This interpretation is also supported by the wording of §27-1-4 , which expressly states that laws appearing in the Alabama Insurance Code (Title 27) do not apply to companies, like [BCBS], that are organized under the provisions of §10-4-100 , unless §10-4-100 et seq. expressly provide that such laws apply."
The majority does not overrule Nielsen, and, in my opinion, construes the holding in Nielsen in an unduly narrow manner. Therefore, I respectfully dissent.
Opinion of the Court
Blue Cross and Blue Shield of Alabama ("BCBS") appeals from a summary judgment entered by the Montgomery Circuit Court in favor of Donald Hodurski, M.D., and two physician assistants, Norman Hobbs and Samuel Irvine (hereinafter collectively referred to as "the providers"). The issue presented is whether a statute included in the Insurance Code, the Physician Assistant Act, codified at §
In reviewing a summary judgment, we apply the same standard as did the trial court. Ex parte Lumpkin,
The standard of review applicable to a determination of standing was accurately set forth by Judge Crawley in MedicalAssociation of the State of Alabama v. Shoemake,
Section
*Page 954"No statute of this state applying to insurance companies shall be applicable to any corporation organized under the provisions of this article [Title 10, Chapter 4, Article 6] and amendments thereto or to any contract made by the corporation unless expressly mentioned in this article and made applicable; except as follows:
"(1) The corporation shall be subject to the provisions regarding annual premium tax to be paid by insurers on insurance premiums.
"(2) The corporation shall be subject to the provisions of Chapter 55, Title 27, regarding the prohibition of unfair discriminatory acts by insurers on the basis of an applicant's or insured's abuse status.
"(3) The corporation shall be subject to the provisions regarding Medicare Supplement Minimum Standards set forth in Article 2 of Chapter 19 of Title 27, and Long-Term Care Insurance Policy Minimum Standards set forth in Article 3 of Chapter 19 of Title 27.
"(4) The corporation shall be subject to Section
27-1-17 , requiring insurers and health plans to pay health care providers in a timely manner."(5) The corporation shall be subject to the provisions of Chapter 56 of Title 27, regarding the Access to Eye Care Act.
"(6) The corporation shall be subject to the regulations promulgated by the Commissioner of Insurance pursuant to Sections
27-7-43 and27-7-44 .
"(7) The corporation shall be subject to the provisions of Chapter 54 of Title 27."
(Emphasis added.)
Section §
"This title [Title 27] shall not apply as to:
". . . .
"(2) Nonprofit corporations for establishment of hospitalization plan [sic] under Section
10-4-100 et seq., except to the extent now or hereafter provided in such laws. . . ."
In 1997, the Legislature enacted §
"(a) An insurance policy or contract providing for third-party payment or prepayment of health or medical expenses shall include a provision for the payment to a supervising physician for necessary medical or surgical services that are provided by a licensed physician assistant practicing under the supervision of the physician, and pursuant to the rules, regulations, and parameters for physician assistants, if the policy or contract pays for the same care and treatment provided by a licensed physician or doctor of osteopathy.
"(b) An insurance policy or contract subject to this section shall not impose a practice or supervision restriction which is inconsistent with or more restrictive than provided by law.
"(c) This section shall apply to services provided under a policy or contract delivered, continued, or renewed in this state on or after August 1, 1997, and to any existing policy or contract, on the policy's or contract's anniversary or renewal date, or upon the expiration of the applicable collective bargaining contract, if any, whichever is later.
"(d) This section does not apply to policyholders or subscribers eligible for coverage under Title XVIII of the federal Social Security Act or any similar coverage under a state or federal government plan.
"(e) For purposes of this section, third-party payment or prepayment includes an individual or group policy or accident or health insurance or individual or group hospital or health care service contract, an individual or group health maintenance organization contract, an organized delivery system contract, a medical service organization created pursuant to Article 6, Chapter 4, Title 10, or a preferred provider organization contract.
"(f) This section shall not be interpreted to require an individual or group health maintenance organization, an organized delivery system, a medical service organization created pursuant to Article 6, Chapter 4, Title 10, or a preferred provider organization or arrangement to provide payment or prepayment to a physician for services provided by a physician assistant, unless the supervising physician of the physician assistant has entered into a contract or other agreement to provide services with the individual or group health maintenance organization, the organized delivery system, the medical service organization, or the preferred provider organization or arrangement."
(Emphasis added.)
Section
"`Where a statute [an Act] requiring uninsured motorist coverage is broad and comprehensive in scope, it establishes as a matter of public policy that every bodily injury motor vehicle policy should provide uninsured motorist coverage; the code [Act] becomes in effect a part of every policy of insurance to which it is applicable, as if it were written out in full in the policy itself.'"
BCBS also challenges the standing of Hobbs and Irvine, the physician assistants. The trial court, however, made no finding as to their standing. Because Dr. Hodurski does have standing, that question is academic.
By way of recapitulation, §
"No statute of this state applying to insurance companies shall be applicable to any corporation organized under the provisions of this article [Article 6 of Chapter 4 of Title 10] and amendments thereto or to any contract made by the corporation unless expressly mentioned in this article and made applicable; except as follows . . . [specific exceptions omitted]."
The Insurance Code (Title 27) at §
In Blue Cross Blue Shield of Alabama, Inc. v. Nielsen,
"It is a familiar principle of statutory interpretation that the Legislature, in enacting new legislation, is presumed to know the existing law. Applying that principle to this case, we can presume that if the Legislature had intended for §
27-1-19 and §§27-19A-1 to -11, and §§27-45-1 to -9 to apply to companies like Blue Cross, it could have eliminated any question by expressly amending §10-4-100 et seq. to specify that those statutes would, in fact, apply. Based on the foregoing, we conclude that Blue Cross is exempted from the Alabama Provider Acts by the provisions of §10-4-115 and § 27-1-4."
The statute at issue in this proceeding, §
This Court has previously considered the authority of a legislative body to bind future legislative bodies. In Van Sandtv. Bell,
This Court has also previously addressed the authority of the Legislature to enact legislation that conflicts with procedural standards in previously enacted legislation. See Town ofBrilliant v. City of Winfield,
"`I realize that prior Legislatures have passed many statutes which contain procedural provisions, which purport to govern legislative procedures. When a succeeding Legislature follows any procedural rules provided for by statute, without objection, the Legislature, by its very action, is adopting the statutory procedure, and no problem is created. When a succeeding Legislature, however, does not wish to adopt a statutory procedure which has been established by a previous Legislature, as is the case here, I believe that the Legislature can change that procedure without adopting a Bill.'"
"`"One legislature cannot bind a succeeding legislature or restrict or limit the power of its successors to enact legislation, except as to valid contracts entered into by it, and as to rights which have actually vested under its acts, and no action by one branch of the legislature can bind a subsequent session of the same branch. Nevertheless during sessions legislative bodies may do and undo, consider and reconsider, as often as they think proper, as only the final result will be regarded as the thing done, and a legislature, in the anticipation *Page 958 of a probable future condition, may provide legal rules to apply thereto."'"
The general rule in other jurisdictions is consistent with the plenary power of each succeeding legislature to enact legislation inconsistent with that enacted in a prior legislative session. For example, see Manigault v. S.M. Ward Co., 123 F. 707, 717 (D.S.C. 1903), aff'd, Manigault v. Springs,
"When, therefore, one General Assembly passes an act like this in question, declaring that no bill shall be introduced or entertained in either House of the General Assembly unless certain prerequisite conditions are fulfilled — conditions not existing in the Constitution — it assumes a power which it does not possess. If, notwithstanding, any succeeding General Assembly shall receive and entertain a bill which has not fulfilled these conditions, this action on its part is either a declaration of its independence of these restrictions, or it is a repeal of the previous act pro tanto. `Acts of Parliament,' says Blackstone (1 Bl. Comm. 90), `derogating to the power of subsequent Parliaments, bind not.'"
(Emphasis added.) See also 1A Norman J. Singer, Statutes andStatutory Construction § 22:2, pp. 244-45 (6th ed. 2002 rev.), "A legislature cannot limit the power of amendment of a subsequent legislature, either as to the extent or manner of its exercise." (Footnote omitted.) In Atlas v. Wayne County,
"The power to amend and repeal legislation as well as to enact it is vested in the Legislature, and the Legislature cannot restrict or limit its right to exercise the power of legislation by prescribing modes of procedure for the repeal or amendment of statutes; nor may one Legislature restrict or limit the power of its seccessors [sic]. 12 C.J. page 806."
See also Solberg v. Davenport,
"The general rule is too well settled to need citation of authority that each legislature is an independent body, entitled to exercise all legislative power under the limitation of the Constitution of this state and the United States, and no legislature can pass a law which would be binding on subsequent legislatures. We think this rule applies to the situation before us. In other words, Section 47 of the Code [of 1927] was utterly disregarded by the legislature; yet this act cannot be held invalid because thereof. Authorities on this proposition are not numerous, but those we have been able to find announce this doctrine. See Ma[n]igault v. S.M. Ward Co., 123 F. 707 [(D.S.C. 1903)]; Cook v. State,26 Ind.App. 278 (59 N.E. 489 ) [(1903)]; State, Use Rathbone, v. County Court of Wirt County,37 W.Va. 808 (17 S.E. 379 ) [(1893)]."
The result in Nielsen, rejecting an attempt to apply a general law that did not expressly refer to entities such as BCBS, is comparable to the result reached in Sovereign Camp,W.O.W. v. Woodmen of the World,
"`[S]uch societies shall be governed by this act and shall be exempt from all provisions of the insurance laws of this state, not only in governmental relations with the state, but for every other purpose, and no law hereafter enacted shall *Page 959 apply to them, unless they be expressly designated therein.'"
(Emphasis added.) One of the parties contended that, based on the rule prohibiting a legislature from binding a future legislature, a statute that was applicable to all corporations without limitation but which did not refer specifically to fraternal-benefit societies applied to such societies, notwithstanding the exemption statute referred to above. In rejecting this argument, the Supreme Court of Colorado stated:
"While it is true that one Legislature cannot bind a future one, yet that clause is not wholly ineffective. This precise question was passed upon in the case of McKnelly v. Brotherhood of American Yeomen,160 Wis. 514 ,523 ,152 N.W. 169 ,172 [(1915)], where it was said, referring to a provision almost identical with ours:"` . . . This provision is nevertheless very significant as an indication of legislative policy, and its continued existence, unrepealed, is fairly persuasive proof that the policy there expressed has been and still is adhered to.'"
Section
This Court recently restated the doctrine of implied repeal inShiv-Ram, Inc. v. McCaleb,
"`"A concise statement of the rule is contained in City of Birmingham v. Southern Express Co.,164 Ala. 529 ,538 ,51 So. 159 ,162 [(1909)]:"`"`Repeal by implication is not favored. It is only when two laws are so repugnant to or in conflict with each other that it must be presumed that the Legislature intended that the latter should repeal the former. . . .'
"`"Implied repeal is essentially a question of determining the legislative intent as expressed in the statutes. When the provisions of two statutes are directly repugnant and cannot be reconciled, it must be presumed that the legislature intended an implied repeal, and the later statute prevails as *Page 960 the last expression of the legislative will."'"
(Quoting Fletcher v. Tuscaloosa Fed. Sav. Loan Ass'n,
At oral argument, counsel for the providers disclaimed reliance on the doctrine of implied repeal as a basis for affirmance of the trial court's judgment. This Court, however, can affirm a judgment on a basis not asserted in the trial court. Cain v.Howorth,
The procedure prescribed in §
BCBS points to the subsequent reenactment of §
"`It has been broadly stated that the rule as to repeals implied from repugnancy of provisions applies as well between a general and a special or local act as between two general ones. As a general rule, however, general or broad statutory provisions do not control, modify, limit, affect, or interfere with special or specific provisions.'"
This Court in Boutwell also quoted from 50 Am.Jur. Statutes § 564 as follows:
"`It is, however, equally true that the policy against implied repeals has peculiar and special force when the conflicting provisions, which are thought to work a repeal, are contained in a special or specific act and a later general or broad act. In such case, there is a presumption that the general or broad law was not designed to repeal the special or specific act, but that the special or specific act was intended to remain in force as an exception to the general or broad act, and there is a tendency to hold that where there are two acts, one special or specific act which certainly includes the matter in question, and the other a general act which standing alone would include the same matter so that the provisions of the two conflict, the special or specific act must be given the effect of establishing an exception to the general or broad act.'"
The subsequent reenactments of §
AFFIRMED. *Page 962
NABERS, C.J., and HOUSTON, JOHNSTONE, and HARWOOD, JJ., concur.
SEE, BROWN, WOODALL, and STUART, JJ., dissent.
Reference
- Full Case Name
- Blue Cross and Blue Shield of Alabama v. Donald Hodurski, M.D. Norman Hobbs and Samuel Irvine.
- Cited By
- 235 cases
- Status
- Published