No. 13 May Term, 1979, Appeal from the Decree of the Commonwealth Court of Pennsylvania at No. 716 C.D. 1978.
James H. Stewart, Jr., Michael C. Fox, Harrisburg, for appellants.
John G. Knorr, III, Dept. of Justice, Harrisburg, for appellee.
Eagen, C. J., and O'Brien, Roberts, Nix, Manderino, Larsen and Flaherty, JJ. Flaherty, J., filed a dissenting opinion, in which Larsen, J., joins. Manderino, J., did not participate in the decision of this case.
Appellants, the Hospital Association of Pennsylvania and twenty-one Pennsylvania hospitals, contend that state regulations governing "general and special hospitals," 28 Pa.Code §§ 101.1 et seq., were promulgated without statutory authority by appellees, the Secretary and the Department of Health. We agree with appellees and the Commonwealth Court that ample basis for the challenged regulations is provided by article IX of the Public Welfare Code.*fn1 Accordingly, we affirm.
In 1972, appellees determined that the department's "Rules and Regulations for Hospitals," last revised in 1966, should again be revised. In full compliance with publication and notice requirements,*fn2 appellees published a set of proposed rules and regulations designed to replace the 1966 rules. 2 Pa.Bull. 1129 (1972). Between 1972 and 1977, appellees evaluated extensive public opinion on the proposed rules, including comment from the Hospital Association of Pennsylvania, and incorporated many suggestions into a revised draft. Again by proper notice, appellees published a revised set of rules and regulations. 7 Pa.Bull. 939 (1977). After further public comment, appellees modified the proposed rules and, in December, 1977, adopted them as modified. 7 Pa.Bull. 3631 (1977).
The challenged regulations span twenty-six chapters, ranging from such concerns as "Governance and Management"
to "Construction Standards."*fn3 Within each chapter there are a series of specific regulations. For example, under the heading "Governance and Management," there appear regulations setting objectives for hospital by-laws, 28 Pa.Code § 103.3, establishing functions to be performed by a "governing body," id. at § 103.4, and directing formation of various "governing body committees." Id. at § 103.6. Also included are regulations establishing a "Patient's Bill of Rights," id. at §§ 103.21-103.24, managerial and administrative responsibilities, id. at §§ 103.31-103.39, and standards for fiscal control. Id. at §§ 103.41-103.46. In all, appellees promulgated over 500 specific regulations.
Before the effective date of the regulations, appellants filed a petition for review in the Commonwealth Court, alleging that appellees lacked statutory authority to promulgate the challenged rules and regulations. On appellees'
motion for summary judgment, the Commonwealth Court sustained the regulations and denied appellants relief.*fn4 This appeal followed.*fn5
Section 902 of the Public Welfare Code expressly provides that the department shall have "supervision" over a number of facilities, including, under subsection (8), "[a]ll institutions for adults within this Commonwealth."*fn6 Appellants concede, as they must, that "general and special hospitals" "are institutions for adults."*fn7 They dispute, however, the
scope of appellees' power of "supervision." Appellants claim they possess "managerial prerogatives" which may not be regulated by appellees.
The Public Welfare Code does not define the department's "supervisory powers" under section 902. Nevertheless, our review of the Code must recognize that "[s]ubstantive rule-making is a widely used administrative practice, and its use should be upheld whenever the statutory delegation can reasonably be construed to authorize it." Bernard Schwartz, Administrative Law § 56 at p. 151 (1976). As Dean Freedman points out, "[t]he existence of a body of standards tends to encourage greater deliberations, self-consciousness, and consistency in the exercise of administrative discretions and thereby reduces the likelihood that an agency will act arbitrarily." James O. Freedman, Crisis and Legitimacy: The Administrative Process and American Government 245 (1978). We are satisfied that, reasonably construed, the ...