U Memo 16-5

Posted on May 12, 2016 in Informal Opinions - UIPA Opinions

U Memo 16-5
May 12, 2016
Alii Health Center, LLC, is Not an “Agency” Subject to the UIPA

Two Requesters asked whether Alii Health Center, LLC (AHC), properly responded under Part III of the UIPA, which contains the law’s “personal record” provisions, to one Requester’s request to amend his personal record maintained at AHC.  In order to answer this question, the threshold question was whether AHC is an agency subject to the UIPA.

Requesters contended that AHC was part of Hawaii Health Systems Corporation (HHSC), which is a State agency.   When HHSC was created, the Legislature gave it broad powers, including the power to create nonprofit corporations consistent with HHSC policies.  In 1999, HHSC created Alii Community Care, Inc. (Alii) to build, own, and operate Roselani Place, a private assisted living facility on Maui, based on the Maui community’s need for an assisted living facility.  In 2007, Alii expanded its mission and created AHC to provide physician services in Kona, when a primary care physician was closing her practice in Kona, which would have left about five thousand people without a physician.

The Hawaii Supreme Court in Olelo: The Corp. for Comm’ty Tel. v. Office of Info. Practices, 116 Haw. 337, 173 P.3d 484 (Haw. 2007) (Olelo), determined that threshold issues that relate to the applicability of UIPA, such as the definition of “agency,” are not left to OIP’s discretion.  Accordingly, any opinion by OIP on whether an entity is an “agency” subject to UIPA is not entitled to a deferential standard of review, but is subject to de novo review by the courts.

The Olelo Court strictly read the term “corporation” in the UIPA’s definition of “agency” to mean one that is (1) owned by the state; or (2) operated by the state; or (3) managed by the state; or (4) owned, operated, or managed on behalf of the state.  Using this standard set by the Supreme Court, AHC does not meet the UIPA’s definition of “agency” and is not subject to the UIPA.  Accordingly, Requester’s request to AHC to amend his personal record is not subject to the personal record correction provisions in Part III of the UIPA.