The Volokh Conspiracy
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Under Pennsylvania's Workers Compensation Act, employers can require employees to get an impairment-rating evaluation to determine what degree of impairment is due to the employee's workplace injury. Doctors doing these evaluations have to use "the most recent edition" of the American Medical Association's Guides to the Evaluation of Permanent Impairment.
Using these guides, a doctor evaluated an injurer worker and gave her a 10% impairment rating; the worker thought her impairment rating should be higher (which would increase her workers comp benefits), and one of her arguments was that the legislature unconstitutionally delegated legislative power to the AMA. Pennsylvania's non-delegation doctrine, similar to the federal one (which I've written about in this Harvard JLPP article and in this forthcoming Emory L.J. article), is based on the vesting clause of its constitution: "[T]he legislative power of this Commonwealth shall be vested in a General Assembly, which shall consist of a Senate and a House of Representatives."
Again like Congress under the federal non-delegation doctrine, the Pennsylvania legislature is allowed to delegate authority to others (for instance, state agencies); this delegation of authority is saved from being a forbidden delegation of legislative authority as long as the legislature makes "the basic policy choices" and the legislation includes "adequate standards which will guide and restrain the exercise of the delegated administrative functions". (The analogous phrase in federal doctrine is "intelligible principle".)
One contributing factor that can save a delegation is if there are "procedural mechanisms that serve to limit or prevent the arbitrary and capricious exercise of delegated power"—that, too, is a factor present in federal doctrine, though, similarly to what I've argued before (see this Supreme Court amicus brief and this D.C. Circuit amicus brief), this comes close to commingling non-delegation concepts with due process concepts—which it's better to keep doctrinally separate.
Anyway, under these standards, the Pennsylvania Supreme Court held that the delegation of authority to the AMA violated the state constitution's non-delegation doctrine. (You can find a very brief concurring opinion here, and a dissenting opinion here.) The authority was "broad and unbridled"; the legislature didn't tell the AMA what policies to pursue or prescribe any standards; nor did the legislature prescribe any procedural mechanisms to ensure that the AMA wasn't acting arbitrarily.
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One interesting aspect of the case is that—unlike in some previous Pennsylvania non-delegation cases—the AMA is a private organization. In a case from last year, West Philadelphia Achievement Charter Elementary School v. School District of Philadelphia, the Pennsylvania Supreme Court struck down a statute allowing a School Reform Commission to suspend Board of Education regulations and Public School Code provisions in order to improve school district finances. The Court held that the statute had insufficient constraints on the Commission's decision-making ability and didn't have safeguards against arbitrary decision-making.
Here, the Court held that the AMA's power was "even more broad and unbridled" than that of the Commission in the School Reform Commission case. The Commission was a public body, and the AMA is private—what difference does that make? I've taken an interest in whether there's any special non-delegation doctrine for private parties (see my Cato Sup. Ct. Rev. article, as well as the two amicus briefs linked above). Some federal courts (and some recent non-majority opinions by some Supreme Court Justices) have taken the view that the non-delegation doctrine prohibits delegations to private parties, and the state lower court here did put some weight on the AMA's being private. The Texas Supreme Court has enunciated a whole doctrine, in the Texas Boll Weevil Eradication Foundation case, limiting delegations to private parties more than delegations to public agencies. (See also a discussion of basically the same issue in Nick Rosenkranz's article, Federal Rules of Statutory Interpretation, at pp. 2131-32—that discussion shows that there's a federal statute presenting much the same issue, 42 U.S.C. § 3796ii-1(1)(A), defining "mental illness" according to "the most recent edition of the Diagnostic and Statistical Manual of Mental Disorders published by the American Psychiatric Association".)
Here, the Pennsylvania Supreme Court held that, since it was already striking down the delegation based on the ordinary non-delegation doctrine, it didn't have to decide whether there was any special doctrine for private parties. The Court noted that "our precedents have long expressed hostility toward delegations of governmental authority to private actors", but that they "have not unequivocally supported the . . . view that the [legislature] cannot, under any set of circumstances, delegate authority to a private person or entity." In fact, in some recent cases, the Court stated the same doctrinal test for both private and public delegates, and has struck down delegations to private parties without mentioning that there was any special private-specific test.
The Court concluded: "Although we highlight this tension in our jurisprudence, we need not resolve it today"—since the statute was already unconstitutional enough even under the ordinary standard. "We merely caution that our holding today should not be read as an endorsement or rejection of the [lower court's] view that the delegation of authority to a private actor is per se unconstitutional. Nor do we foreclose the distinct possibility that a more exacting form of judicial scrutiny is warranted when the General Assembly vests private actors with regulatory or administrative powers."
(The opinion went on to discuss and reject a possible constitutional avoidance rationale, under which "most recent edition" could be read to mean "most recent edition as of the date this statute was enacted"; and then also discussed issues of severability, which I'll omit here.)
Anyway, I'm glad to see (1) that courts are discussing the federal and state non-delegation doctrines, (2) that they're actually striking down statutes under those doctrines, and (3) that some recent cases, including this one, have stopped short of stating any special rule against delegations to private parties. This will be an issue to watch in Pennsylvania.