2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 1 of 36 Pg ID 1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF MICHIGAN. Hon.

Transcription

1 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 1 of 36 Pg ID 1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF MICHIGAN STAT Emergency Medical Service, Inc, Plaintiff, vs. Case No. Hon. SAGINAW VALLEY MEDICAL CONTROL AUTHORITY, DR. NOEL WAGNER, M.D., ERIC SNIDERSICH, EDWARD BRUFF, Individually and as a Director of the SAGINAW VALLEY MEDICAL CONTROL AUTHORITY, RICK OHLE, Individually and as a Director of the SAGINAW VALLEY MEDICAL CONTROL AUTHORITY, JEAN ANTHONY, Individually and as a Director of the SAGINAW VALLEY MEDICAL CONTROL AUTHORITY, JOSHUA SALANDER, Individually and as a Director of the SAGINAW VALLEY MEDICAL CONTROL AUTHORITY, Defendants. / BLANCO WILCZYNSKI, P.L.L.C. ORLANDO L. BLANCO (P34480) DEREK S. WILCZYNSKI (P57079) Attorneys for Plaintiffs 2095 E. Big Beaver Road, Suite 400 Troy, MI / PLAINTIFF S COMPLAINT FOR INJUNCTIVE RELIEF, DECLARATORY JUDGMENT, AND COMPENSATORY DAMAGES PURSUANT TO 42 U.S.C. SEC NOW COMES the above-named Plaintiff, STAT Emergency Medical Service, Inc (hereinafter STAT ), by and through its attorneys, BLANCO WILCZYNSKI, P.L.L.C.,

2 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 2 of 36 Pg ID 2 and for its Complaint for Injunctive Relief, Declaratory Judgment, and Compensatory Damages, states as follows: PARTIES AND JURISDICTION 1. This is a Complaint for Injunctive Relief, Declaratory Judgment, and Compensatory Damages pursuant to 42 U.S.C. Sec to preclude the Saginaw Valley Medical Control Authority (hereinafter the SVMCA ) from denying STAT, a Michigan licensed ambulance provider, from providing ambulance services to patients and customers, such as patients of Health Plus, the Saginaw County Community Mental Health Authority, and Birch Run Township, in the SVMCA geographic service area without due process and in restraint of trade, and from refusing STAT Medical Control Privileges within SVMCA S geographic service area. 2. STAT is a nationally accredited ambulance company (through the Commission on Accreditation of Ambulance Services ( CAAS )), licensed by the Michigan Department of Community Health ( MDCH ) as a life support agency with its principal place of business located in Flint, Michigan, in Genesee County. STAT provides emergency medical services, including 911 primary emergency response, response for emergency assistance, mutual aid, patient transfers and interfacility transports within the State of Michigan. (See Affidavit of STAT Chief Operating Officer and Vice President, Joe Karlichek, attached as Ex. 1). 3. STAT has been licensed as a Life Support Agency by the State of Michigan since Its current license authorizes STAT to provide Advanced Life Support ( ALS ) in Michigan. (See Ex. 1). 4. Defendant, Edward Bruff, is the Chairman of the Board of Directors of the Saginaw Valley Medical Control Authority, as well as the Chief Operating Officer of 2

3 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 3 of 36 Pg ID 3 Covenant Hospital. Upon information and belief, Bruff is on the Board of Directors for of Mobile Medical Response ( MMR ), which is the only ambulance service currently allowed to operate in Saginaw County by the SVMCA. 5. Defendant, Rick Ohle, is a member of the Board of Directors of the Saginaw Valley Medical Control Authority. 6. Defendant, Jean Anthony, is a member of the Board of Directors of the Saginaw Valley Medical Control Authority. 7. Defendant, Joshua Salander, was a member of the Board of Directors of the Saginaw Valley Medical Control Authority at all times pertinent to the violations outlined in this Complaint. 8. Defendant, Dr. Noel Wagner, is the Medical Director for the Saginaw Valley Medical Control Authority. 9. Defendant, Eric Snidersich, is the EMS Manager for the Saginaw Valley Medical Control Authority. 10. Defendant, the Saginaw Valley Medical Control Authority, is the local medical control authority for the geographic service area covering Saginaw County and Birch Run Township. 11. The Michigan Public Health Code 1978 P.A. 368 M.C.L et. seq. ( the Code ) protects the public health and provides for the regulation of health services and activities. Part 209 of the Code titled as the Emergency Medical Services Act ( EMSA ), regulates ambulances and prehospital care in Michigan. MCL et. seq. 12. Pursuant to Section 20902(5) of the EMSA, an ambulance operation is defined as a person licensed under this part to provide emergency medical services 3

4 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 4 of 36 Pg ID 4 and patient transport, for profit or otherwise. MCL (5). The EMSA does not in any way limit or restrict the geographic service area in which a licensed ambulance service may provide services in Michigan. 13. The Michigan Department of Community Health ( MDCH ) licenses ambulance operations and coordinates and administers a state-wide emergency system in Michigan. MCL (1)(e)(ii). Local Medical Control Authorities ( MCAs ) are created by statute and are given well-defined authority to supervise emergency medical services in designated geographic regions called geographic service areas. MCL (1)(2). In order to implement emergency medical services in their geographic regions, MCAs are required to submit written drafts of proposed protocols to the MDCH for review and approval prior to adoption and implementation. MCL (1), (3)(a)-(b). An MCA s authority is limited by statute. An MCA has no authority over licensure matters, may not add conditions of licensure to those mandated by statute, and shall sign a life support agency s application for medical control privileges pursuant to R (2). 14. As a Licensed Life Support Agency, STAT functions under the supervision of its designated Medical Control Authority, Genesee County Medical Control Authority ( GCMCA ), but is authorized by law to provide ambulance services outside of the GCMCA geographic serviced area and in accordance with state law, local protocols and consistent with accepted ambulance operations throughout the State of Michigan. 15. The SVMCA is the Medical Control Authority designated as part of a statewide emergency medical services system to supervise emergency medical services in the designated geographic service region consisting of all of Saginaw County, pursuant to the provisions of the EMSA. MCL (1). 4

5 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 5 of 36 Pg ID For years, STAT has provided ambulance response services to patients, medical facilities and providers within its geographic service area and throughout the State of Michigan. 17. In November of 2011, STAT applied for medical control privileges within the SVMCA geographic service area and submitted all statutorily required materials for approval. 18. Since November of 2011, Defendants have unlawfully and without any Due Process, denied patients, medical facilities and providers, the right to use STAT EMS to perform ambulance transports originating in the SVMCA s geographic service region. 19. This Court has jurisdiction because this case involves violations of STAT s constitutional rights to Due Process and Equal Protection under the Fourteenth Amendment of the United States Constitution and a taking in violation of the Fifth Amendment of the United States Constitution, and also includes a claim for damages in excess of $75,000 brought pursuant to 42 U.S.C The Federal claims are brought pursuant to 42 U.S.C. 1983, which permits private suits in law or equity against persons who, under color of State Law, ordinance or regulation, cause a person to be subjected to a deprivation of rights secured by the Constitution or laws of the United States. See, Baker v McCollan, 443 US 137, 99 S.Ct. 2689, 61 L.Ed. 2d 433 (1979). 20. Jurisdiction is proper in this Court pursuant to 28 U.S.C and 1343(a)(3) because the issues raise a federal question pursuant to 42 U.S.C Jurisdiction for the declaratory relief sought is also proper pursuant to 28 U.S.C and Venue is appropriate in this forum pursuant to 28 U.S.C. 1391(b). 5

6 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 6 of 36 Pg ID 6 FACTUAL BACKGROUND 21. STAT has been a licensed ambulance provider in the State of Michigan since 2001 authorized to provide ALS, including but not limited to, responding to calls for emergency assistance within the GCMCA and providing 911 priority emergency response in Fenton City. (Ex. 1). 22. STAT currently provides 911 primary emergency response in Genesee County. 23. STAT currently has business relationships with various hospitals, medical providers, health insurers, and facilities to provide ambulance service, including ALS, emergency response assistance and ambulance transport of both emergency and nonemergency patients to and from medical facilities. For example, STAT has a contractual relationship with Health Plus of Michigan to provide ambulance transport service to Health Plus partners in six counties, including Saginaw County. Because STAT has been unlawfully denied medical control privileges to operate within the SVMCA, STAT has been unjustly precluded from performing contracted for services for Health Plus in Saginaw. (Ex. 2). In addition, STAT has a relationship with the Saginaw County Community Mental Health Authority to provide ambulance transport services in Saginaw County. (Ex. 3). Birch Run Township in Saginaw County has also expressed its desire to use STAT s services in Saginaw County to provide 911 response to its community. (Ex. 4). 24. Since November of 2011, STAT EMS has been wrongfully and illegally prevented by Defendants from operating as an ambulance service in areas governed by the SVMCA, despite meeting requirements for medical control privileges within the SVMCA s region. 6

7 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 7 of 36 Pg ID In November of 2011, STAT applied to the SVMCA for medical control privileges to operate in its geographic service area in accordance with state statutory requirements. (See, Ex. 5). On December 8, 2011, the SVMCA sent a letter to STAT requesting additional information. (Ex. 6). By way of example, the SVMCA asked for more information from STAT regarding the geographic response area to be covered by STAT. On December 8, 2011, STAT sent a response letter addressing all areas of concern. (Ex. 7). 26. On February 26, 2012, STAT sent an to Eric Snidersich, the SVMCA EMS Manager, asking for a status update as to the application and when the inspection of its facilities would occur. (Ex. 8). On February 27, 2012, Mr. Snidersich sent an response advising STAT that the SVMCA Board had requested that the SVMCA move forward with the agency inspection. (Ex.9). On February 28, 2012, the SVMCA sent STAT EMS a letter notifying it of the onsite inspection, to occur within 60 days of verification of the application. (Ex.10). 27. On March 20, 2012, the SVMCA conducted an onsite agency visit to STAT s facility, in which no deficiencies were noted and that the SVMCA offices of the medical director were reported a satisfactory score to our Board of Directors. (Ex. 11). 28. However, despite passing the onsite inspection, on June 8, 2012, STAT received a letter from Dr. Noel Wagner, stating that the SVMCA Board of Directors had met on June 6, 2012 and denied STAT s Application. According to Dr. Wagner, the reasons for the denial were: 1. Emergency service requirements are currently being met in the proposed area. Response time analysis, clinical indicators, and lack of negative prehospital incident reports were all considered. 7

8 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 8 of 36 Pg ID 8 2. The application did not establish a need through an acceptable survey/assessment or empirical evidence. 3. The potential for growth in the area is not substantial enough to support the level of service being proposed. 4. Rural community EMS response relies on an economy of scale from higher volume areas and thus transferring a fixed volume and reimbursement to another provider will negatively impact all communities by increasing cost per call to each agency. 5. A mutual aid agreement with a similarly capable, contiguous, and approved SVMCA agency was not presented. 6. The service area was not properly defined. The application addresses the Birch Run Community but does not delineate between the Township and Village. (See, Ex. 12). Furthermore, Board Member Bruff identified himself as having a conflict of interest due to his affiliation as a Board Member of Covenant Health and MMR, refrained from voting on the issue, but nonetheless voiced his opinion against STAT s application. 29. On June 28, 2012, pursuant to the Administrative Rules established by the MDCH, STAT filed an Allegation/Complaint Form with the State of Michigan Department of Community Health, Emergency Medical Services & Trauma Systems Section, ( EMS Section ) disputing as non-meritorious each of the six bases for denial of STAT s Application and requesting a Denial Justification Review ( DJR ) by the MDCH. R R (See, Ex. 13). 30. On July 17, 2012, Robin Shivley, Crime Victims, EMS & Trauma Systems Division Director ( EMS Division ), sent a letter to counsel for STAT EMS requesting certain information. (Ex. 14). STAT s legal counsel provided this information to Ms. 8

9 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 9 of 36 Pg ID 9 Shivley on August 14, (Ex. 15). In accordance with MDCH Administrative Rules, the EMS Division conducted a DJR of the SVMCA s denial of STAT s application and concluded that the SVMCA had improperly denied STAT the right to operate in the SVMCA s geographic service area and also concluded that the SVMCA s denial was fraught with conflict of interest. (Ex.16). 31. On April 9, 2013, after completing the DJR Ms. Shivley sent a letter to the SVMCA addressing the complaint filed by STAT EMS concluding that: Based upon the denial justification review and as identified above, it is the Department s position that the Saginaw Valley Medical Control Authority should allow STAT EMS to provide service to the Birch Run area and should reconsider their denial of STAT s Application. In addition, Ms. Shivley also noted the SVMCA s conflict of interest: Saginaw Valley MCA provides funds to MMR to insure Dr. Wagner s first response vehicle. Ed. Bruff, COO of Covenant is a MMR Board Member and a MCA Board Member. SVMCA s concern with the financial viability of MMR (the current service area provider). (Ex.16). 32. On April 18, 2013, as a follow up to Ms. Shivley s letter, STAT EMS counsel sent the SVMCA a letter requesting that Dr. Wagner sign the Part 1 application authorizing STAT to operate in the SVMCA. STAT EMS counsel referred to the April 9, 2013 letter from Ms. Shivley. (Ex. 17). 33. On April 25, 2013, the SVMCA responded to STAT EMS attorney, stating that, matters of this kind can only be approved by the Medical Control Authority s Board of Directors. The SVMCA also indicated that STAT s request for medical control privileges was added to the agenda for the next meeting of the Board and would be discussed and addressed at that meeting, along with Ms. Shivley s letter. (Ex. 18). 9

10 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 10 of 36 Pg ID On May 6, 2013, STAT s attorney sent the SVMCA follow up correspondence, noting that the next meeting of the Board of Directors was not until June 20, 2013 and, therefore, requesting a special board meeting. (Ex. 19). 35. The SVMCA responded to that letter on May 14, 2013, stating that, In accordance with the SVMCA Bylaws, a special meeting of the Board may only be called by the chairman or a majority of the members. No request has been made by the chairman or a majority of the members. (Ex. 20). 36. On May 25, 2013, counsel for STAT directed a letter to Mr. Snidersich requesting a meeting with him and Medical Director Dr. Wagner to address the points made in Ms. Shivley s letter, as well as STAT s legal position in regard to the application. Counsel s hope was to assist the SVMCA so it could complete the application process and extend medical control privileges to STAT. (Ex. 21). 37. In response, counsel received a letter dated June 3, 2013 from the SVMCA indicating that it would not be appropriate to meet in advance of the June 20, 2013 Board meeting. (Ex. 22). 38. On June 5, 2013, counsel for STAT spoke by telephone with counsel for the SVMCA requesting that, at a minimum, the SVMCA advise STAT whether the SVMCA would allow STAT to operate in advance of the June 20, 2013 meeting. (Ex. 23). 39. On June 20, 2013, the SVMCA Board met as scheduled, but, contrary to its representations, refused to consider STAT s application. In fact, at that meeting, the SVMCA took only one action in connection with the application - to place the Department s letter in the SVMCA s STAT EMS file, without any further consideration. Mr. Snidersich, EMS Manager for SVMCA, acknowledged his receipt of the Department s letter and stated that there was no basis for it. 10

11 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 11 of 36 Pg ID On July 8, 2013, Mr. Kurt Krause, Director Bureau of Legal Affairs for the MDCH sent a letter to SVMCA advising them that they had failed to act in accordance with the Department s directive of April 9, 2013 and requested that the SVMCA immediately sign the Part 1 authorizing STAT to operate within the SVMCA. (Ex. 24). 41. On July 25, 2013, Mr. Krause convened a meeting where Dr. Wagner, Mr. Snidersich, and representatives from STAT, met with representatives of the MDCH in regard to STAT s Application for Medical Control Privileges in the SVMCA. Counsel for both parties attended. (Ex. 25). 42. The purpose of the meeting was to discuss the SVMCA s denial of STAT s Application for Medical Control Privileges, the DJR which was undertaken by the State and formalized in the directive/letter from Robin Shivley on April 9, 2013, and the SVMCA s failure to comply with the denial justification review. (Ex. 25). 43. At the meeting, counsel for the SVMCA, stated that: (1) the SVMCA Board, and not Dr. Wagner, is the only authority within the SVMCA geographic service is which can approve a Part 1 Application for Privileges; (2) the SVMCA Board does not believe that the Department, after the denial justification review, ordered the SVMCA to extend medical control privileges to STAT EMS; (3) that the SVMCA s protocol regarding clinical need authorized it to compel STAT to prove to the SVMCA that there existed a need for more life support agencies within the SVMCA s geographic service area prior to extending privileges to STAT; (4) that the protocol was not vague and ambiguous; (5) that STAT did not meet the requirements of this protocol during its application process; and 11

12 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 12 of 36 Pg ID 12 (Ex. 25). (Ex. 24). (6) that the protocol is neither vague nor ambiguous. STAT EMS took the opposite view point on all of these issues. 44. Mr. Krause took the position that: (1) the clinical need protocol was vague and ambiguous 1 ; there is no clinical need requirement under Michigan law for an ambulance to operate. (2) STAT EMS nonetheless met the requirements of the protocol; (3) the protocol presents an issue from a restraint of trade standpoint; (4) the requirements of the protocol are not authorized by the Emergency Medical Services Act, which only provides that a medical control authority must extend medical control privileges upon the completion of an application and payment of the application fee; and (5) STAT EMS should be extended medical control privileges in the SVMCA. 45. Mr. Krause invited the SVMCA to research the legal basis for the State s position, but also said that he would consider having the State sign an interim Part 1, extending medical control privileges to STAT EMS in the SVMCA during this interim period. (Ex. 25). 46. The SVMCA s counsel told Mr. Krause that he, Dr. Wagner and Mr. Snidersich did not have the authority to agree to extend privileges to STAT EMS on behalf of the SVMCA because that could only be done by the SVMCA Board. The Emergency Medical Services Act clearly mandates that it is the medical control authority 1 The SVMCA recognized that its clinical need protocol was vague and ambiguous and attempted to change the protocol in May of 2013 and submitted a new protocol to the MDCH s EMS Division. The EMS Division rejected the proposed amended clinical need protocol. 12

13 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 13 of 36 Pg ID 13 medical director, in this case, Dr. Wagner, who is required to sign the Part 1, authorizing MCA privileges. The SVMCA s counsel told Mr. Krause that he would need to bring this matter before the SVMCA s Board of Directors and would do so within the next 30 days. (Ex. 25). 47. On July 30, 2013, the Department responded with a letter in which Kurt Krause committed to: (Ex. 26). 1) Providing a deadline by which the SVMCA s counsel would provide any additional information that the Saginaw Valley Medical Control Authority might want to provide in support of its decision to deny STAT EMS's application and/or a revised decision, altogether; and 2) Responding to STAT s counsel s request that MDCH approve STAT EMS's application, on an interim basis, until such time that the SVMCA provides its additional information/revised decision. 48. The SVMCA responded with a letter dated August 9, 2013, demanding that the State withdraw its April 9, 2013 letter. (Ex. 27). The SVMCA also considered the DJR to be a review and not an appeal. The SVMCA submitted further information to the State regarding its denial of STAT s application and attempted to supplement the State s file with this information. 49. On August 13, 2013, STAT sent a letter to the SVMCA in which it strongly disagreed with the SVMCA s position regarding the DJR as well as the SVMCA s denial of STAT EMS s Part 1. (Ex. 26). 50. STAT also strongly requested that the Department take the following action in regard to the SVMCA s refusal to sign STAT s Part 1: (1) order the SVMCA to sign the Part 1; 13

14 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 14 of 36 Pg ID 14 (Ex. 28). (2) in the event the SVMCA refuses to sign the Part 1, for the Department to sign the Part 1 itself; (3) alternatively, for the State to authorize STAT to operate in the SVMCA geographic service, under the authority of the Genesee County Medical Control Authority; or (4) alternatively, suspend the authority of the SVMCA and transfer oversight of its life support agencies to a new or different MCA who will abide by the State s determination extending STAT s authority to operate SVMCA. 51. As to the specific points raised by the SVMCA, STAT objected for a number of reasons. First, as to the SVMCA s position that it was not provided a definition or official explanation of a DJR and its characterization of a DJR as a review and not an appeal, STAT pointed out that this position was simply incorrect and, further, a distinction without a difference. R (2) provides: (Ex. 28). The medical director shall insure the provision of medical control. The medical director s signature on a life support agency s Application for Licensure or Relicensure affirms that the Medical Control Authority intends to provide medical control to the life support agency. If the medical director refuses to sign the life support agency s Application for Licensure or Relicensure, then the medical director shall notify the Department in writing, within five business days, providing justification for denial. Refusal of a medical director to sign a life support agency s Application shall result in denial justification review by the Department. 52. STAT pointed out that this statutorily mandated Rule clearly provides three indisputable requirements: (1) medical control direction shall be provided; (2) to the extent that the medical director refuses MCA privileges, justification for the denial shall be provided in writing; and (3) the Department shall review a medical 14

15 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 15 of 36 Pg ID 15 director s refusal to sign a Part 1 authorizing MCA privileges. The statutory mandate requiring the Department to conduct a denial justification review of an MCA s refusal of privileges is clearly meaningless without, at a minimum, the implied authority to conduct the review and, where appropriate, to authorize MCA privileges. (Ex. 28). 53. STAT also pointed out that it was clear that the Department, by Robin Shively s April 9, 2013 letter, reviewed the SVMCA s denial and concluded that STAT EMS met the requirements of the SVMCA and was, therefore, legally entitled to the extension of medical control privileges within the SVMCA geographic service area. (Ex. 28). 54. STAT noted that this provision of subsection (2) was enacted to give the Department oversight to prevent arbitrary and capricious decisions, or political influence, on the part of a Medical Control Authority and/or the Medical Control Director. It is a tool extended to the Department by the legislature to assist in the Department s oversight of medical control authorities and medical directors to ensure that they do not act in a rogue manner and contrary to the Emergency Medical Services Act. In this regard, Ms. Shively s April 9, 2013 letter was entirely consistent with the denial justification review process and the goals of subsection (2). (Ex. 28). 55. Second, STAT disagreed with the SVMCA that calling a DJR a review, as opposed to an appeal, had any significance. STAT emphasized that a DJR was automatically triggered in the event that a medical director refuses to sign a Part 1, and is required to occur after written notification by the medical director. In this case, however, Dr. Wagner did not report his refusal to sign the Part 1 to the Department, thus not triggering the automatic review. Rather, this process was initiated by STAT EMS. (Ex. 28). 15

16 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 16 of 36 Pg ID Whether the DJR was considered a review or appeal, subsection (2) authorized the Department to exercise its oversight function precisely, as the statutory language provides, to determine whether there is justification for the denial of the Part 1. The Department s extensive review resulted in a finding that there was no justification for the denial, as more fully set forth in Ms. Shively s April 9, 2013 letter. However, as of that date, other than sending the letter, the Department had not taken any formal action in regard to the SVMCA S denial of STAT EMS Part 1. (Ex. 28). 57. STAT took the position that the Department had the authority to either (1) sign the Part 1 itself; or (2) require the SVMCA to sign the Part 1. Alternatively, STAT took the position that the Department has the authority to suspend the SVMCA and transfer its oversight duties to neighboring Medical Control Authorities, pointing out that without the authority to take action, subsection (2) would be meaningless. (Ex. 28). 58. STAT also did not consider the DJR process to still be open and continuing as it pertained to STAT s application. Regardless of whether the Department considered the information provided in the July 24 letter, the information conveyed at the July 25 meeting, and the SVMCA s counsel s August 9, 2013 letter, STAT believed that the SVMCA had nonetheless acted arbitrarily and capriciously, as well as without due process and in furtherance of the restraint of trade, in denying the STAT EMS Part 1. (Ex. 28). 59. The SVMCA s protocol, by which STAT EMS was required to identify a clinical need within the geographic service area of the SVMCA, is not supported by the Emergency Medical Services Act and, further, is an illegal barrier to STAT EMS (or any life support agency) providing care within the geographic service area of the SVMCA. 16

17 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 17 of 36 Pg ID 17 Significantly, the only requirement under the Emergency Medical Services Act for the extension of medical control privileges by a medical control authority is that a life support agency pay the required fee and be available 24/7 to provide emergency medical services. STAT clearly meets these requirements. (Ex. 28). 60. STAT requested that the Department take a second look at the protocol, particularly in light of comments made by Dr. Wagner and Mr. Snidersich, that the purpose of the protocol is to keep life support agencies out of Saginaw County, noting that, on its face, it was clearly a restraint of trade and suppression of free enterprise. (Ex. 28). 61. Despite STAT s disagreement with the SVMCA that its protocol was authorized pursuant to the Emergency Medical Services Act, STAT nonetheless addressed the issues raised by the SVMCA. To begin with, the SVMCA argued that a letter from Birch Run Township was insufficient to meet Section 2 of the protocol. STAT pointed out that because this letter was transmitted to STAT and, further, because STAT provided this letter to the SVMCA, regardless of whether STAT is specifically mentioned by name, the letter was intended to refer to and apply to STAT EMS. STAT also objected to the SVMCA s position that the Township supervisor is not authorized to act on behalf of the Township Board. By taking this position, the SVMCA is substituting its belief and interpretation of the Birch Run Township Supervisor with its own. (Ex. 28). 62. In addition, the SVMCA s indicated that there was an issue because the letter issued by Birch Run Township did not mention STAT by name. STAT noted that the SVMCA ignored Ms. Shivley s analysis of the sufficiency of Birth Run Township s support in her April 9 letter, in which she concluded that the Township Supervisor 17

18 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 18 of 36 Pg ID 18 provided oversight for both the Township and the Village, clearly addressing the issue raised by the SVMCA. (Ex. 28). 63. As to the mutual aid requirement, and the SVMCA s issue with it, STAT observed that the issue had changed and was different than the one investigated and analyzed by the Department. According to Ms. Shivley s letter, STAT identified that Twin Township Service and their Board (licensed in both Genesee County MCA and SVMCA) agreed to provide STAT EMS Mutual Aid once licensed. Ms. Shivley addressed the SVMCA s concern that this was not given to the SVMCA in letter form by making a formal finding of it, thus rendering this issue moot. (Ex. 28). 64. As to the clinical need requirement, Ms. Shivley found that the SVMCA placed a requirement on STAT which was not found in its clinical need protocol. This was not addressed by the SVMCA, which instead asked the Department for more time to submit information to the Department. STAT stated that this was nothing more than a delaying tactic, one which it strongly opposed. (Ex. 28). 65. STAT also disagreed with the SVMCA s interpretation of the Department s April 9 letter in regard to the clinical need requirement, agreeing with the State that the clinical need requirement is vague and ambiguous. The SVMCA Protocol cited in support of the requirement, Subsection (E.2), Section 13 of the Life Support Agency Standards provides, in total: Any transporting agency (BLS or ALS), new or upgrade, shall describe and establish the clinical need for the new or upgraded service and its impact on the existing EMS care delivery system. Clearly, there is no definition of the term clinical need, and certainly no indication of whether that clinical need is in reference to the economic, patient care, or 18

19 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 19 of 36 Pg ID 19 other impact of adding a new life support agency to the Saginaw Valley geographic service area. (Ex. 28). 66. Additionally, the SVMCA stated that Section 13 of the protocol provides that the SVMCA Board of Directors is the body that determines whether the clinical need has been met by the applicant. STAT countered that this requirement is, however, contrary to the Emergency Medical Services Act and the regulation promulgated thereunder (referred to above) which clearly mandates that the medical control director, not the Board of Directors for a local MCA, provide medical direction for a life support agency and sign the Part 1. (Ex. 28). 67. Moreover, STAT perceived that the SVMCA s basis for determining that STAT had not met its requirements to establish a clinical need was not supported by the evidence presented by STAT. In that evidence, STAT clearly and carefully outlined the issues relating to response times within the Birch Run area, Birch Run s need for an additional life support agency, and the benefit which would be provided to the community. The evidence underscored the problem with a clinical need protocol, which authorizes a local medical control authority to consider factors not contemplated by the Emergency Medical Services Act. (Ex. 28). 68. Essentially, the SVMCA left the extension of medical control privileges to a life support agency to the wit and whim of a local medical control authority board, a non-elected body, which, according to the State s DJR was fraught with conflicts of interest, despite the fact that the EMSA clearly contemplates the extension of medical control privileges based on two factors which have no economic incentive to deny the extension of those privileges the payment of a fee and the availability of the life support agency to provide emergency medical services on a 24/7 basis. (Ex. 28). 19

20 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 20 of 36 Pg ID Moreover, STAT highlighted that the SVMCA had taken the conclusory position one would anticipate in regard to the State s denial justification-review: that it considered the factors contemplated by its protocol and issued its decision in accordance with that protocol. STAT countered by pointing out that this was precisely why the Department had been given the statutory authority to conduct a denial justification review to insure that the Medical Control Authority is following the established legal requirements under the Emergency Medical Services Act and the Rules promulgated thereunder and to act when it is not. (Ex. 28). 70. STAT also addressed the issue that Board Members had a conflict of interest, telling the SVMCA, we are particularly troubled with its counsel s assertion that he had the SVMCA Board of Directors call a special meeting, open to the public, during which the STAT EMS Application was discussed. Despite the fact that this meeting apparently took place well after the Department corresponded and met with the SVMCA about it s failure to follow the law and rules, neither the Department nor STAT EMS were given notice of this meeting, nor invited to attend, in order to participate in the process that the SVMCA claims it had engaged for consideration of STAT s application to operate within the SVMCA. According to the SVMCA s attorney s letter, the Board reconsidered the STAT EMS Application and then reaffirmed its previous denial. While the SVMCA s attorney claimed that the meeting was open to the public, it was inconceivable that STAT EMS was not provided notice of this meeting and was not invited to attend. (Ex. 28). 71. STAT renewed its request to the Department to: (1) order the SVMCA to sign the Part 1; 20

21 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 21 of 36 Pg ID 21 (Ex. 27). (2) in the event the SVMCA refuses to sign the Part 1, for the Department to sign the Part 1 itself; (3) alternatively, for the State to authorize STAT to operate in the SVMCA geographic service, under the authority of the Genesee County Medical Control Authority; or (4) alternatively, suspend the authority of the SVMCA and transfer oversight of its life support agencies to neighboring MCA s and extending STAT s authority to operate to the new MCA. 72. On August 21, 2013, Defendant, Dr. Noel Wagner, the SVMCA Medical Director, appeared before the Saginaw County Fire Chief s Association and informed the audience that there would not be another EMS provider allowed to operate in Saginaw County and that this would most likely result in litigation. Dr. Wagner also stated that he did not want to go back to the days of multiple EMS service providers because he did not want to relive this experiment. 73. On September 16, 2013, the Mr. Krause issued a letter on behalf of the State, in which he stated that, the Department stands by its conclusion that the [SVMCA] should allow STAT EMS to provide emergency medical response to the Birch Run area. (Ex. 29). 74. The Department further stated that it was ready to, issue a license for STAT EMS to practice in the Birch Run area immediately upon the [SVMCA s] Director s signature on the licensure application. But whether that signature comes voluntarily or is compelled by court order is a matter that will need to be resolved between STAT EMS and the [SVMCA]. (Ex. 29). 21

22 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 22 of 36 Pg ID STAT noted that it was clear from the Department s letter of September 16, 2013, that the Michigan Department of Community Health (the Department ) had determined that STAT EMS met all of the statutory criteria to operate within the geographic boundaries of the SVMCA. It was also clear from the Department s correspondence that the Department stands ready to issue a license to STAT EMS to practice in the Birch Run area and the State strongly believes that the SVMCA Medical Director should indeed sign STAT s EMS Licensure Application to operate in that MCA. (Ex. 30). 76. Under the circumstances, given that STAT EMS clearly meets all of the criteria for operating in the SVMCA; and, in the Department s own opinion, should be permitted to operate there, STAT EMS requested that it should be allowed, at a minimum, to perform non-emergency transports for facilities and clients who may geographically fall within the boundaries of the SVMCA. (Ex. 30). 77. Accordingly, STAT informed the Department that it intended to begin to service those medical providers and clients who require its services in the SVMCA s geographic service area. STAT also noted that because it understood that the SVMCA Medical Director refuses to sign the Part I, certifying medical control over STAT EMS, STAT did not expect that it would be called upon to provide emergency response services to the Birch Run area. Nevertheless, STAT stated that it remained available to respond to emergency calls in the Birch Run area, on a 24/7 basis. Under the circumstances, however, STAT believed that it would be in everyone s best interests, including the Department, for the Department to provide STAT EMS with a letter which authorizes and/or, at a minimum, confirms the Department s understanding that STAT EMS is authorized to perform non-emergency transport service in the SVMCA 22

23 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 23 of 36 Pg ID 23 geographic service area, despite the SVMCA s refusal to sign the Part I License Application. (Ex. 30). 78. STAT also brought to the Department s attention that Mobile Medical Response ( MMR ) Ambulance Company had been provided authority to operate within the boundaries of the Tri-County Emergency Medical Control Authority ( TCEMCA ), for the limited purpose of providing non-emergency transports for three Lansing area hospitals. It is our understanding that MMR was granted these privileges by the TCEMCA, despite the fact that MMR was not providing emergency response to any municipality and/or township in the boundaries of that MCA. It was clear that MMR was being allowed to operate in a geographic service area where it has limited presence and availability, and, more importantly, where it is not designated to provide any emergency response. STAT pointed out that it was inconsistent for the SVMCA to claim that STAT EMS should not be allowed to operate within its MCA because it wants to protect MMR s territory, while at the same time allowing the primary, if not exclusive agency in Saginaw to operate elsewhere without meeting the very criteria that the SVMCA proclaims to be the basis of their exclusion of STAT EMS from operating in Saginaw. (Ex. 30). 79. Defendants reckless and illegal acts directly resulted in STAT EMS being barred from performing services in the SVMCA geographic service area. By way of example, on June 6, 2013, STAT sub-contracted a reoccurring transfer of a patient, pursuant to its contact with Health Plus. Twin Township, the sub-contracting party, informed STAT that Mobile Medical Response informed Twin Township that, You are no longer authorized to do this transport. Twin Township relayed this information to STAT. 23

24 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 24 of 36 Pg ID As a direct result of Defendants wrongful and illegal acts, the health, safety and welfare of patients who rely on STAT EMS for ambulance response and transport has been jeopardized and patients and medical providers have been denied access to their ambulance of choice, STAT EMS, including on occasions when no other acceptable and/or legal ALS were available for ambulance transport. 81. As a result of Defendants wrongful and illegal acts, patients in the SVMCA geographic service area have been prohibited from using STAT EMS for ambulance transport. 82. STAT EMS has made every reasonable effort to gain Medical Control Privileges within the SVMCA s geographic service area, but has been wrongfully and without due process been refused such privileges. 83. The actions taken by the SVMCA are also inconsistent with the current practice of other Medical Control Authorities in the State of Michigan that oversee and direct life support agencies providing emergency medical services outside of their designated geographic service areas. 84. STAT EMS has made every reasonable attempt to exercise its administrative remedies in response to the SVMCA s actions, including, but not limited to: (a) seeking intervention of the Department of Community Health, EMS and Trauma Division, by meeting with the Department on at least two occasions, one of which was attended by representatives of the SVMCA; (b) STAT has appealed to Defendants to reconsider this decision; however, Defendants have refused to provide and continue to refuse to provide, STAT EMS with any hearing of its appeal. 85. Even if STAT EMS were allowed by Defendants to exercise its administrative remedies, it is likely that any such exercise would be futile, given 24

25 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 25 of 36 Pg ID 25 Defendants previous actions, which clearly demonstrate bad faith, recklessness and an intent to harm STAT EMS reputation and standing within the EMS community. Furthermore, Defendants have expressly denied STAT EMS access to the SVMCA Board meetings where deliberations and votes were held regarding STAT EMS right to operate in THE SVMCA s geographic service region. 86. Unless this Court grants injunctive relief, Defendants will continue to illegally and selectively implement policies without due process barring STAT EMS from providing ambulance service that STAT EMS is licensed to provide under Michigan law, and further jeopardizing the health, safety and welfare of patients who require ambulance service and care and are being prohibited from their choice of ambulance provider. COUNT I ULTRA VIRES ACTS, REQUEST FOR TEMPORARY RESTRAINING ORDER AND INJUNCTIVE RELIEF 87. MCL part of the Emergency Medical Services Act, provides that an Ambulance Service shall be licensed by the State of Michigan pursuant to the EMSA upon completion of an application and payment of a $ fee and upon meeting the following requirements of the Act, found at MCL Those requirements are: (a) (b) (c) Provide at least one ambulance available for response to request for emergency assistance on a 24-hour-a-day, 7-daya-week basis in accordance with local medical control authority protocols; respond or ensure that a response is provided to each request for emergency assistance originating from within the bounds of the service area; operate under the direction of a medical control authority or the medical control authorities with jurisdiction over the ambulance operation; 25

26 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 26 of 36 Pg ID 26 (d) (e) notify the department immediately of a change that would alter the information contained on its application for an ambulance operation license or renewal; provide life support consistent with its license and approved local medical control authority protocols to each emergency patient without prior inquiry into ability to pay or source of payment. 88. Michigan s Statewide Emergency Medical Services System is governed by local MCAs, organized and administered by local hospitals, within each geographic region. MCL (1)(2). Each person licensed under the Emergency Medical Services Act is accountable to their local MCA in the provision of Emergency Medical Services. 89. The EMSA does not otherwise authorize the SVMCA to prohibit or limit STAT EMS from providing pre-hospital care and transport, to facilities and patients in the SVMCA s geographic service area, simply because STAT EMS did not meet an arbitrary and illegal set of requirements instituted by the SVMCA. MCL (1)(a). 90. STAT EMS has suffered, and will continue to suffer, irreparable injury if Defendants are allowed to continue their selective and illegal implementation of policies and rules which are not authorized by statute or administrative rule and which are being arbitrarily enforced against all ambulance providers which wish to operate in the SVMCA s geographic service area. 91. Defendants will suffer no harm if this Court enters injunctive relief, barring Defendants from implementing and enforcing a policy that is arbitrarily being enforced against emergency medical service providers who wish to operate in the SVMCA geographic service area. 26

27 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 27 of 36 Pg ID The public interest is best served by barring the implementation of the SVMCA s selective and illegal policies and procedures as the health, safety and welfare of patients in need of emergency medical services and transport will be threatened if STAT EMS is not allowed to continue to provide those services to patients and institutions in the SVMCA s geographic service area. 93. Additionally, STAT EMS will suffer irreparable harm as more fully set forth herein and in the attached Affidavit of its Chief Operating Officer and Vice President (See Ex. 1) if Defendants continue to prohibit STAT EMS from exercising the privileges of its state issued ambulance license. WHEREFORE, STAT EMS requests that this Court enter a Preliminary and Permanent Injunction Enjoining Defendants from barring STAT EMS from performing ambulance services for patients within the SVMCA s region and further enter a Declaratory Judgment that Defendants directives and orders, including the September 17, 2008 directive, is ultra vires and, accordingly, beyond the power of the the SVMCA to enact. COUNT II DEPRIVATION OF PROPERTY RIGHTS AND LIBERTY INTEREST WITHOUT DUE PROCESS AND/OR COMPENSATION 94. At all times pertinent to Plaintiffs Complaint, Defendants acts were and continue to be without authority and violative of STAT EMS s rights to substantive Due Process of law under the 14 th Amendment to the U.S. Constitution, actionable pursuant to 42 U.S.C. Section 1983 and the Michigan Constitution 1963, Article 1, Section At all times pertinent to Plaintiffs Complaint, Defendants acts, as more fully described above, were conducted under the color of law, without providing STAT 27

28 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 28 of 36 Pg ID 28 EMS with notice and/or without an opportunity to be heard, and were without authority and, therefore, violated STAT EMS rights to procedural Due Process of law under the 14 th Amendment to the U.S. Constitution, actionable pursuant to 42 USC, Section 1983, and Michigan Constitution 1963, Article 1, Section At all times pertinent to Plaintiffs Complaint, the implementation of Defendants arbitrary and illegal protocols and actions have resulted in STAT EMS being barred from providing ambulance services in accordance with its state license, effectively amounting to a taking of STAT EMS s property interests without Due Process of law. 97. At all times pertinent to Plaintiffs Complaint the implementation of Defendants policies, protocols, and actions have resulted in an unconstitutional deprivation of STAT EMS liberty interests without Due Process of law. 98. At all times pertinent to Plaintiffs Complaint, as more fully described above, Defendants have acted arbitrarily and capriciously and have no rational basis in enacting its policies and/or actions, which were done with the intent of harming STAT EMS. WHEREFORE, STAT EMS requests that this Court enter a Declaratory Judgment stating that the policies, protocols, and actions implemented by Defendants have resulted in a violation of STAT EMS substantive and procedural Due Process rights under the 14 th Amendment to the U.S. Constitution, and the Michigan Constitution 1963, Article 1, Section 17 and that STAT EMS should be entitled to damages from Defendants in an amount to be determined by the Court, including costs and attorney fees wrongfully incurred. 28

29 2:13-cv GCS-MJH Doc # 1 Filed 12/06/13 Pg 29 of 36 Pg ID 29 COUNT III EQUAL PROTECTION OF THE LAW 99. At all times pertinent to Plaintiffs Complaint, Defendants have selectively implemented policies and actions against STAT EMS which are motivated by a malicious, reckless and bad faith intent to injure STAT EMS and while not having been implemented and/or enforced against other similarly situated licensed ambulance providers in Defendants MCA region. For example, the SVMCA has stated that it has intentionally only allowed one provider to operate in its geographic service region, to the exclusion of all others The denial of medical control privileges issued by the SVMCA prohibits STAT EMS from conducting its ambulance business in the SVMCA s geographic service region Defendants at all times have acted under the color of state law As a result of the SVMCA s wrongful and illegal acts, STAT EMS has suffered and continues to suffer loss of business and property by being unable to provide ambulance transport and care in the SVMCA s geographic service area, including ambulance services to patients and providers who have specifically requested STAT EMS for ambulance transport and STAT EMS has also been effectively prohibited from honoring contracts with several medical facilities for ambulance transport The SVMCA s illegal and selective implementation of the policies and acts more fully described above has the effect of unlawfully limiting STAT EMS from functioning as a licensed ambulance provider and prohibits STAT EMS from continuing to service patients and institutions that it is already servicing, and has contracted to service, in the SVMCA s geographic service area. 29