A Kentucky appeals court has upheld a lower court ruling that said Fleming Regional Medical Imaging is exempt from the certificate of need requirements for the state of Kentucky.

In an opinion written by Judge Michelle M. Keller, the Court of Appeals of Kentucky found that the appellants in the case, Fleming County Hospital and the Kentucky Hospital Association, bore the burden of proof and failed to show that Fleming Regional should be held to the certificate of need requirements based on the factors outlined by the Kentucky Cabinet for Health and Family Services.

There are some exceptions to the certificate of need requirement, according to the written opinion, with a few important factors at issue in determining whether a facility is exempt. First, the facility must be physician-owned. The activity that takes place in the facility must also meet certain regulations, including having physician participation at the facility. Additionally, patient referrals to the facility must primarily come from the practice of the physician owner.

“The appellants argue that [Fleming Regional] failed to prove that it was solely owned by physicians,” wrote Judge Keller. “However, the undisputed testimony from [Timothy E. Dineen, MD and Glenn R. Womack, MD] was that [Fleming Regional] had three owners, all of whom were physicians.” Judge Keller acknowledged that Womack, one of the three owners, had admitted to discussing the expansion of ownership, though no such expansion actually took place.

The court found that the appellants did not prove Fleming Regional violated any of the requirements for exemption, though the written opinion noted that the imaging facility could lose this exemption should it modify its working arrangement in such a way that it violates the regulations at a later date.