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7 N.J.A.R. 262

Women's Medical Center at Howell et al v. Finley, JoAnne, M.D., M.P.H., New Jersey Commissioner of Health
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Citation: 7 N.J.A.R. 262
Decision Date: 1982
Agency: DEPARTMENT OF HEALTH
Synopsis: Petitioners, three separate gynecological and obstetrics practices, sought a hearing on the decision of the Commissioner of Health that they were not exempt from the Health Care Facilities Planning Act, N.J.S.A 26:2H-1 et seq. The administrative law judge assigned to the case found that all three petitioners provide first trimester outpatient abortions and, as proprietary centers, contract with various physicians who provide abortion services and related gynecological care; outpatient first tri- mester abortions provide the overwhelming majority of the center's revenue. All employees work under the direct supervision of the physicians. The office equipment is owned by a management com- pany, which also leases the premises. No capital investment is made by the physicians. The judge concluded that the centers were exempt from the act, pursuant to N.J.S.A 26:2H-2b which excludes from the definition of health care service, services provided by a physician in his private State of New Jersey 263 practice. The judge determined that the primary characteristic which distinguishes a physician's office from a health care facility was the degree of control exercised by the physician and that in these in- stances it was the physicians who exerted complete control. Accordingly, the administrative law judge concluded that the peti- tioners were physicians' offices and thus were not subject to the requirements of the Health Care Facility Planning Act. Upon review, the Commissioner of Health rejected the initial deci- sion. The Commissioner determined that despite the fact that the physicians may have retained professional control over the operation and their respective practices, there was still a concern that their medical judgment might be subject to the influence of the manage- ment companies which exercised a strong role in the operation of the centers. In addition, the centers had served as the continuing focus of services despite the cancellation of contracts with various physicians. Accordingly, the Commissioner concluded that the petitioners were health care facilities subject to the provisions of the Health Care Facilities Planning Act, N.J.S.A. 26:2H-1 et seq. Shel!artl A. Guryan, Esq. for petitioners, North Jersey Gyneco- logical Center, Inc. and Cherry Hill Women's Center (Lasser, Hoch- man, Marcus, Guryan & Kuskin, Esqs., attorneys) Burton L. Eichler, Esq. for Women's Medical Center (Brach, Eich- ler, Rosenberg, Silver, Bernstein & Hammer PA, Esqs., attorneys) Charlotte Kitler, Deputy Attorney General, for respondent (Irwin I. Kimmelman, Attorney General of New Jersey, attorney) Robert I). Gruen, Esq. for intervenor, North Jersey Gynecological Center PA, (Gruen & Ritvo, Esqs., attorneys)