Hospital Association of Oregon appeals court decision in Health Care Market Oversight Program case

June 18, 2024

The Hospital Association of Oregon filed a notice of appeal to the United States Court of Appeals for the Ninth Circuit, appealing the district court’s summary judgment order in the case of Oregon Association of Hospitals and Health Systems v. State of Oregon et al., case number 22-cv-1486 (D. Or.).

The hospital association intends to argue that the state law creating the Health Care Market Oversight Program is unconstitutional and a violation of the Due Process Clause. The hospital association will ask the Ninth Circuit to reverse the U.S. District Court’s order and enter judgment in its favor. 

The Oregon Legislature passed HB 2362 in 2021 to create the Health Care Market Oversight Program, which gives Oregon Health Authority (OHA) significant power to oversee transactions involving health care entities, and aims to promote transparency, support statewide priorities, and monitor impacts.

The hospital association challenged the law on two grounds: first, the law’s open-ended and vague wording violates the Due Process Clause of the U.S. Constitution because it imposes costs and penalties without fair notice or defined standards. And second, the law violates the Oregon Constitution because it delegates legislative power to a state agency, OHA. In May, a U.S. District Court judge ruled the law does not violate the Due Process Clause of the U.S. Constitution and declined jurisdiction over the state constitutional claim.

“This law was intended to enhance health equity and access to care, both goals we support, but it falls short,” said President and CEO Becky Hultberg. “Instead, it excessively empowers the Oregon Health Authority, leading to costly and arbitrary processes that divert resources away from supporting patient care. We look forward to arguing our case before the appellate court.”