MURPHY-DUBAY v DEPARTMENT OF LICENSING AND REGULATORY AFFAIRS
Docket Nos. 321380 and 321749
Court of Appeals of Michigan
Submitted August 5, 2015. Decided August 18, 2015.
311 Mich App 539
Leave to appeal sought.
Nathan Murphy-DuBay brought an action in the Ingham Circuit Court against the Department of Licensing and Regulatory Affairs (Bureau of Health Care Services, Professional Licensing Section) and its director, seeking a writ of mandamus and a declaratory judgment to compel defendants to take action on his application for a limited license to practice medicine. Plaintiff had graduated from a medical school in the Netherland Antilles. He subsequently applied to enter postgraduate clinical training programs (commonly known as “residencies“) in the United States but was unable to secure a position.
DEBORAH A. SERVITTO, J.
William E. Collette, J.
The Court of Appeals held:
1. Plaintiff argued that defendants misinterpreted and misapplied the Public Health Code,
2. Plaintiff also argued that if the licensing rules at issue do not authorize at least a limited medical license for individuals who have demonstrated competence through the testing process, they are an unconstitutional exercise of the state‘s authority to regulate health professions because they violated his due-process and equal-protection guarantees. The right to engage in a business such as practicing medicine, however, is subject to the state‘s police powers to enact laws in furtherance of the public health, safety, welfare, and morals. A person challenging legislation on due-process and equal-protection grounds because of its interference with economic or business activity must establish either that the legislation serves no legitimate public purpose or that no rational relationship exists between the provisions and a legitimate public purpose. The statute here serves a legitimate public purpose: protecting the public by ensuring that medicine is practiced in a safe and competent manner. At issue, then, was whether a rational relationship exists between the postgraduate-residency requirement and this legitimate public purpose. The requirement ensures that those who practice medicine possess a certain amount of medical education and training and have adequately demonstrated their fitness and capacity to practice medicine in a safe and competent manner by completing a residency. Accordingly, because the requirement of a period of postgraduate education before a license may be issued is rationally related to a legitimate public purpose, it neither violates due process nor constitutes a denial of equal protection, and plaintiff‘s constitutional claims failed.
3. The board of medicine did not exceed its authority under
4. Contrary to plaintiff‘s assertion, the Public Health Code‘s regulatory scheme requiring admission to a postgraduate program to obtain a license did not constitute the improper subdelegation of licensing decisions. An administrative agency may not subdelegate the exercise of discretionary acts unless the Legislature expressly grants it authority to do so. While the admissions committees of the board-approved programs determine the individuals who are admitted to those programs, which undoubtedly affects the likeli- hood of full licensure, that decision is only one of many indirect influences on a person‘s ability to achieve the goal of licensure.
5. The postgraduate-clinical-training rule did not violate antitrust law.
6. Denying plaintiff a license did not constitute a regulatory taking of private property in violation of state or federal law. While both the United States and Michigan Constitutions prohibit the taking of private property without due process or just compensation, one who asserts an uncompensated-taking claim must first establish that a vested property right was affected. A vested property right is an interest that is more than a mere expectation. It requires a legitimate claim of entitlement. Although plaintiff might have had an expectation that his education, examination results, and experience would enable him to obtain a residency and ultimately a full license to practice medicine, that expectation was not a vested property right.
7. Plaintiff was not denied his due-process right to an administrative hearing because no life, liberty, or property interest was at stake. Plaintiff was also not denied his statutory right to an administrative hearing.
Affirmed.
Mark D. DuBay for plaintiff.
Bill Schuette, Attorney General, Aaron D. Lindstrom, Solicitor General, and Bridget K. Smith, Assistant Attorney General, for defendants.
Before: SAWYER, P.J., and M. J. KELLY and SHAPIRO, JJ.
PER CURIAM. In Docket No. 321380, plaintiff appeals as of right an opinion and order of the Court of Claims granting defendants’ motion for summary disposition on plaintiff‘s complaint for a writ of mandamus and declaratory judgment; plaintiff had sought to compel the Department of Licensing and Regulatory Affairs to take action on his purported application for a limited license to practice medicine. In Docket No. 321749, plaintiff appeals as of right a final order of the circuit court affirming the decision of the Department of Licensing and Regulatory Affairs, Bureau of Health Care Services, Professional Licensing Section, which had rejected the application. We affirm.
I. FACTS
Plaintiff attended Saba University School of Medicine, located on the island of Saba in the Netherland Antilles. He completed two years of coursework, followed by two years of clinical rotations through Dalhousie University in Nova Scotia, Canada. After his clinical rotations, plaintiff returned to Michigan and began seeking entrance into postgraduate clinical training programs (commonly known as “residencies“), but was unable to secure a position.1
On June 18, 2013, plaintiff submitted an application on a form he created himself, seeking a “limited license” to practice medicine within the state of Michigan pursuant to
On September 30, 2013, the manager of the Bureau of Health Care Services, Professional Licensing Section, sent plaintiff a letter explaining that the Michigan Board of Medicine does not issue limited licenses to individuals upon request and that limited licenses are “typically issued for a group of licensees who either have restrictions to the location in which they may physically practice such as with an educational limited license or for disciplinary purposes for someone who has previously held a full license.” In addition, the manager explained that
On October 28, 2013, defendants filed a motion for summary disposition of plaintiff‘s complaint for a writ of mandamus and declaratory judgment pursuant to
On April 1, 2014, the Court of Claims issued an opinion and order granting defendants’ motion for summary disposition on plaintiff‘s complaint for a writ of mandamus and declaratory judgment pursuant to
II. INTERPRETATION OF MCL 333.16182
Plaintiff first asserts that defendants misinterpreted and misapplied the Public Health Code,
(1) A board may grant a limited license to an individual if the board determines that the limitation is consistent with the ability of the individual to practice the health profession in a safe and competent manner, is necessary to protect the health and safety of patients or clients, or is appropriate to promote the efficient and effective delivery of health care services. (2) In addition to the licenses issued under subsection (1), a board may grant the following types of limited licenses upon application by an individual or upon its own determination:
(a) Educational, to an individual engaged in postgraduate education.
(b) Nonclinical, to an individual who functions only in a nonclinical academic, research, or administrative setting and who does not hold himself or herself out to the public as being actively engaged in the practice of the health profession, or otherwise directly solicit patients or clients.
(c) Clinical academic, to an individual who practices the health profession only as part of an academic institution and only in connection with his or her employment or other contractual relationship with that academic institution. For an individual applying for a limited license under this subdivision to engage in the practice of medicine under part 170 [
MCL 333.17001 toMCL 333.17084 ], “academic institution” means that term as defined [MCL 333.17001 ].
Specifically, plaintiff asserts that the first part of Subsection (1), which authorizes a limited license when “consistent with the ability of the individual to practice the health profession in a competent manner,” is applicable here and that “[i]t is this provision that authorizes the Agency to issue Plaintiff a limited license which it refuses to do.”
Subsection (1) permits a limited license to be issued if any of its three criteria are met, including the condition of being “consistent with the ability,” the criterion on which plaintiff relies. However, the Legislature, through the Public Health Code, invested in the various licensing boards broad discretion with respect to the licensing of applicants to practice health professions. It did not, as plaintiff asserts, unambiguously provide in Subsection (1) that the board of medicine must grant a limited license to practice medicine to someone in plaintiff‘s particular situation.
For example,
An individual who is licensed or registered under this article [
MCL 333.16101 toMCL 333.18838 ] shall meet all of the following requirements:* * *
(c) Have a specific education or experience in the health profession or in a health profession subfield or health profession specialty field of the health profession, or training equivalent, or both, as prescribed by this article or rules of a board necessary to promote safe and competent practice and informed consumer choice.
the department, in consultation with a board, may promulgate rules to establish standards for the education and training of individuals to be licensed or registered, or whose licenses or registrations are to be renewed, for the purposes of determining whether graduates of a training program have the knowledge and skills requisite for practice of a health profession or use of a title.
In
In developing minimum standards of educational prerequisites for licensure or registration, a board and its task forces shall consider equivalency and proficiency testing and other mechanisms, and where appropriate grant credit for past training, education, or experience in health and related fields. Standards may include those for formal education, practice proficiency, and other training, education, or experience which may provide equivalence to completion of formal educational requirements.
This statute does not restrict a board in its decisions that follow these considerations. Rather, it reflects a grant of power and discretion.
Finally, it is evident from viewing the entire regulatory scheme (rather than only looking at
Plaintiff‘s argument that defendants misinterpreted and misapplied the relevant portions of the Public Health Code fails. Plaintiff‘s argument that the availability of medical care would be enhanced by issuance of the type of limited license he seeks should be directed to the Legislature and the appropriate agencies for consideration as a matter of policy.
III. CONSTITUTIONAL ARGUMENTS
Plaintiff next argues that if the licensing rules at issue do not authorize at least a limited medical license for individuals who have demonstrated competence through the testing process, i.e., by passing Step 3 of the USMLE, those rules should be declared an unconstitutional exercise of the state‘s authority to regulate the professions because they violate his due-process and equal-protection guarantees. We disagree.4
“That the State through the legislature may provide for the licensure and regulation of professions, like the healing arts in which the public interest is very great, is not open to question.” Fowler v Bd of Registration in Chiropody, 374 Mich 254, 256; 132 NW2d 82 (1965). This is because the right to engage in business is subject to the state‘s police powers to enact laws in furtherance of the public health, safety, welfare, and morals. Grocers Dairy Co v Dep‘t of Agriculture Director, 377 Mich 71, 75; 138 NW2d 767 (1966). Accordingly, when legislation is challenged on due-process and equal-protection grounds because of its interference with economic or business activity, the challenger must establish either that no legitimate public purpose is served by the legislation or that there is no rational relationship between the provisions and a legitimate public purpose. Stanfield v Dep‘t of Licensing & Regulation, 128 Mich App 207, 211-212; 339 NW2d 876 (1983). Thus, there is a two-step inquiry: (1) whether there is a legitimate public purpose and, if so, (2) whether there is a rational relationship between the legislation and the public purpose sought to be achieved.
In this case, there is a legitimate public purpose served by the legislation: to protect the public by ensuring that medicine is practiced in a safe and competent manner. The real dispute is over whether there is a rational relationship between the postgraduate-residency requirement and this legitimate public purpose.
We conclude that the Public Health Code‘s requirement that a period of postgraduate education must be completed before a license may be issued is rationally related to ensuring that medicine is practiced in a safe and competent manner. The requirement that a residency must be completed before a person can be licensed to practice medicine is rationally related to this public purpose because it ensures that those who practice medicine possess a certain amount of medical education and training and that they have adequately demonstrated their fitness and capacity to
IV. ACTS IN EXCESS OF STATUTORY AUTHORITY AND UNLAWFUL SUBDELEGATION
Plaintiff next argues that the board of medicine exceeded its authority under
(2) The board [of medicine] approves and adopts by reference the standards for accrediting hospitals which were adopted in April, 1986, by the joint commission on accreditation of hospitals and which were effective January 1, 1987. The board shall consider any hospital or institution that is accredited by the joint commission on accreditation of hospitals as a hospital or institution approved by the board.
(3) The board approves and adopts by reference the standards for approving postgraduate clinical training programs which were adopted in 1987 by the accreditation council for graduate medical education and which were effective July 1, 1987, entitled “The Essentials of Accredited Residencies in Graduate Medical Education,” and the board shall designate any program of postgraduate clinical training approved by the accreditation council for graduate medical education as a program approved by the board. [
Mich Admin Code, R 338.2313 .]
Plaintiff asserts that, in adopting these rules, the board of medicine exceeded its statutory authority because the goal of
As discussed above, the flaw in plaintiff‘s argument is that the Legislature, through the Public Health Code, invested in the board of medicine broad discretion with respect to the licensing requirements of applicants to practice medicine. Indeed, that the board has discretion to determine what satisfies the requirement of completing a period of postgraduate education to attain proficiency in the practice of the profession is evident in the text of
Plaintiff also asserts that the regulatory scheme at issue, which requires admission to a postgraduate program to obtain a license, effectively enables the admissions committees of the programs to deny a license to practice medicine and is therefore an improper subdelegation of the licensing decision. “It is well settled that an administrative agency may not subdelegate the exercise of discretionary acts unless the Legislature expressly grants it authority to do so.” Edmond v Dep‘t of Corrections (On Remand), 143 Mich App 527, 536; 373 NW2d 168 (1985).
Although it is true that the admissions committees of the programs determine the individuals who are admitted to the programs, which undoubtedly affects the likelihood of the ultimate goal of full licensure, such a decision is one of many indirect influences on the person‘s ability to achieve the goal of licensure. Indeed, the same argument could be made concerning the admissions committees of medical schools. We find no impermissible subdelegation of authority.
V. ANTITRUST ARGUMENTS
Plaintiff next argues that the postgraduate-clinical-training rule violates antitrust law. We disagree.6
The Michigan Antitrust Reform Act,
The establishment, maintenance, or use of a monopoly, or any attempt to establish a monopoly, of trade or commerce
in a relevant market by any person, for the purpose of excluding or limiting competition or controlling, fixing, or maintaining prices, is unlawful. [ MCL 445.773 .]
The act contains an exemption for state agencies and boards:
This act shall not apply to a transaction or conduct specifically authorized under the laws of this state or the United States, or specifically authorized under laws, rules, regulations, or orders administered, promulgated, or issued by a regulatory agency, a board, or an officer acting under statutory authority of this state or the United States. [
MCL 445.774(4) .]
Plaintiff‘s argument fails because the challenged anticompetitive conduct he complains of (requiring the completion of two years of postgraduate clinical training in a program approved by the ACGME before a license may be issued) is undertaken pursuant to a regulatory scheme that, as discussed above, is authorized by the Public Health Code. Thus, the exemption in
Regarding federal antitrust law, plaintiff did not raise this issue in his complaint or argue it before the trial court, and we could very well deem it waived. See Admire v Auto-Owners Ins Co, 494 Mich 10, 17 n 5; 831 NW2d 849 (2013) (noting that Michigan generally follows the “raise or waive” rule of appellate review).7 In any event, the policy complained of (again, requiring the completion of two years of postgraduate clinical training in a program approved by the ACGME before a license may be issued) is equally exempt from federal antitrust laws under the “state action” doctrine because it is clearly articulated and affirmatively expressed as state policy and the policy is actively supervised by the state. North Carolina State Bd of Dental Examiners v FTC, 574 US 494; 135 S Ct 1101, 1110; 191 L Ed 2d 35 (2015).
VI. REGULATORY TAKING
Plaintiff next argues that denying him a license is a regulatory “taking” of private property in violation of state and federal law. We disagree.8
“The constitutions of both the United States and the State of Michigan provide that private property shall not be taken without due process or just compensation.” In re Certified Question, 447 Mich 765, 787; 527 NW2d 468 (1994). “One who asserts an uncompensated taking claim must first establish that a vested property right is affected.” Id. at 787-788. “Without a property right, a plaintiff has no basis for challenging a statute on the ground that it constitutes a confiscatory taking without due process of law.” Id. at 788. A vested property right is an interest that is more than a mere expectation. Id. Rather, it requires a “legitimate claim of entitlement.” Berkowitz v Dep‘t of Licensing & Regulation, 127 Mich App 556, 563; 339 NW2d 484 (1983).
In this case, although plaintiff might have had an expectation that his education, examination results, and experience
Because plaintiff cannot establish that a vested property right is affected, his uncompensated-taking claim fails. Certified Question, 447 Mich at 788.
VII. DUE-PROCESS OR STATUTORY RIGHT TO AN ADMINISTRATIVE HEARING
Lastly, plaintiff argues that he was denied his due-process and statutory right to an administrative hearing. We disagree.9
No person may be deprived of life, liberty, or property without due process of law.
Plaintiff also asserts that he was entitled to a hearing pursuant to
(1) The department shall provide an opportunity for a hearing in connection with the denial, reclassification, limitation, reinstatement, suspension, or revocation of a license or a proceeding to reprimand, fine, order restitution, or place a licensee on probation.
(2) The department shall provide an opportunity for a hearing in connection with the denial, limitation, suspen- sion, or revocation, or reinstatement of a registration or a proceeding to reprimand, fine, order restitution, or place a registrant on probation.
(3) A disciplinary subcommittee shall meet within 60 days after receipt of the recommended findings of fact and conclusions of law from a hearings examiner to impose a penalty.
(4) Only the department shall promulgate rules governing hearings under this article [
MCL 333.16101 toMCL 333.18838 ], article 7 [MCL 333.7101 toMCL 333.7545 ], or article 8 [MCL 333.8101 toMCL 333.8511 ] and related preliminary proceedings.
The statute does state that “[t]he department shall provide an opportunity for a hearing in connection with the denial . . . of a license . . . .”
Affirmed.
SAWYER, P.J., and M. J. KELLY and SHAPIRO, JJ., concurred.