STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

RIVERSIDE HOSPITAL, )

)

Petitioner, )

)

vs. ) CASE NO. 76-1945

) FLORIDA OFFICE OF COMMUNITY ) MEDICAL FACILITIES, )

)

Respondent. )

) UNIVERSITY HOSPITAL BUILDING, )

INC. d/b/a/ Memorial Hospital of ) Jacksonville, )

)

Petitioner, )

)

vs. ) CASE NO. 76-1946

) FLORIDA OFFICE OF COMMUNITY ) MEDICAL FACILITIES, )

)

Respondent. )

) BAPTIST MEMORIAL HOSPITAL, )

)

Petitioner, )

)

vs. ) CASE NO. 76-1947

) FLORIDA OFFICE OF COMMUNITY ) MEDICAL FACILITIES, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice this matter came on for final hearing before the undersigned Hearing Officer on November 17 and November 18, 1976, in Jacksonville, Florida. This proceeding is a "fair hearing" held pursuant to Chapter 120 and Chapter 381, Florida Statutes, and 42 USCS, Section 1320a-1(d).

APPEARANCES

For Respondents: Eric Haughdahl, Esquire

Department of Health and Rehabilitative Services

1323 Winewood Boulevard

Tallahassee, Florida 32301

For Petitioners: Kenneth F. Hoffman, Esquire

Post Office Box 1872 Tallahassee, Florida 32302

With the agreement of the parties the three petitions were consolidated for hearing and single order will be entered by the Hearing Officer. The parties stipulated that the Petitioners had given timely notice of their intention to make a capital expenditure pursuant to 42 CFR Section 100.106 and F.A.C.

Section 101-1.03. The parties further stipulated that Respondent had timely complied with the procedural requirements of federal and state law. The primary issue subject to determination by this proceeding is whether the Petitioners' proposed capital expenditure is consistent with the standards, plans and criteria developed pursuant to the Public Health Service Act, as specifically identified at Sections 101-1.03(c) and 101-1.03(a)(7)(b), F.A.C.

FINDINGS OF FACT

Upon consideration of the oral and documentary evidence presented the following facts are found:

1. Petitioners each made application for a certificate of need under the provisions of Sections 381.493 through 381.497, Florida Statutes, 1975, which applications were submitted to the Bureau of Community Medical Facilities and accepted as complete by the bureau. Each application seeks a certificate of need for a third generation computerized axial tomography scanner (whole body unit) hereinafter referred to as a CAT scanner. There is presently in Jacksonville a head scanner installed at St. Vincent Hospital in November, 1975, and a whole body scanner at St. Luke's Hospital which has been in full operation since January, 1976. All three Petitioners are located in Jacksonville, Florida.

   
   

2. The applications were processed by the appropriate Health Systems Agency. After due consideration the Health Systems Agency recommended that each of the three applications be granted. At the request of the Bureau of Community Medical Facilities, Department of Health and Rehabilitative Services, the State Hospital Advisory Council reviewed the applications and upheld the Health Systems Agency's determination that the three applications should be granted certificates of need.

   
   

3. After consideration of the applications, the Health Systems Agency's recommendation the State Hospital Advisory Council's recommendation, Mr. Art Forehand, Administrator, Office of Community Medical Facilities, Respondent herein, notified each of the three Petitioners that their applications were not favorably considered. Mr. Forehand's notification set forth three reasons for the unfavorable consideration. Those were (1) lack of demonstrated need for the requested scanner, (2) failure of each application to demonstrate positive action toward containment of cost for services rendered to the public, and (3) lack of demonstrated unavailability, unaccessability, and inadequacy of like services within the Jacksonville area. At the time of his decision Mr. Forehand had no material or information available to him which was not available to the Health Systems Agency or the State Hospital Advisory Council at the time of their decision. At the time the three applications were denied Mr. Forehand felt that there did exist a need for one additional scanner in the Jacksonville area but he did not feel that he should bear the burden of deciding which one of the three applications should be granted and therefore all three were denied. Except for those matters set forth in Mr. Forehand's denial and noted above,

   none of the parties to this proceeding disputed that the criteria for determining need found in Section 101-1.03(c), F.A.C., were met.

   
   

4. A study of computerized axial tomography with suggested criteria for review of certificate of need applications was conducted by the staff of the Health Systems Agency of Northeast Florida relative to the Duval County area. This study was published in April of 1976 and its findings appear to have been accepted by the Health Systems Agency. As one of its suggested criteria for determining need it found that a hospital or applicant should have a potential case load of at least 1,000 CAT scans per year. The study went on to project a potential case load for the three Petitioners herein. That projection for Baptist Memorial Hospital shows a a potential case load of 2,512 scans per year. The study noted that Baptist Memorial projected 1,300 scans for the first year during start up operations and 2,080 scans during the second and third years of their forecast. The study found that Riverside Hospital has a potential case load of 1,196 scans per year compared to their own projections of 1,432 scans per year. The study finally found that the University Hospital has a potential case load of 1,558 scans per year compared to their projection of 2,904.

   
   

5. Testimony on behalf of the Respondent shows that in the opinion of Respondent full use of a CAT scanner is 10 scans per day on a 20-day work month working five days a week. As shown by unrebutted testimony the existing scanner at St. Luke's Hospital in Jacksonville is presently averaging 10 scans per day, five-days a week. Further, according to the evidence presented by Respondent, the existing scanner at St. Vincent is being utilized to at least 85 percent of its capacity. Respondent took the position at the hearing that when existing scanners are being used to 85 percent or more of their capacity a need exists for more equipment. Thus, it appears that using the criteria of utilization adhered to by Respondent, the existing CAT scanners in Jacksonville are being utilized to the extent that there is a need for additional scanners.

   
   

6. University Hospital has 310 licensed beds and is the community hospital in Duval County with the responsibility of serving the indigent on an emergency and short term basis. It is the trauma center of the city and has the most active emergency room. It is also the major teaching hospital in Duval County. Respondent agrees that it has the greatest need of any hospital in Duval County for a CAT scanner. The University Hospital has approximately 300 visits per month to its emergency room. In the four months prior to the date of final hearing the hospital did 586 skull x-rays due to trauma. In the case of acute trauma patients frequently may not be moved from one hospital to another for the purpose of a CAT scan nor, in some cases, should other dangerous invasive techniques be used for diagnosis.

   
   

7. Baptist Hospital has 567 licensed beds and is a major oncology center or cancer center and does a large amount of surgical cancer work in additional to radiation therapy. With the possible exception of University Hospital, Baptist Hospital is the largest pediatric hospital in the area. According to the testimony of the administrator of the hospital it would take 14 to 18 months after receipt of a certificate of need to have a CAT scanner in service.

   
   

8. Riverside Hospital has 183 licensed beds. The hospital has been a specialty hospital since its establishment in 1908 and serves the Riverside Clinic. The hospital has approximately 200 specialized physicians, all board certified, on-staff. Riverside is a unique hospital because of its degree of specialty and its relationship to Riverside Clinic. Riverside Hospital does 100 percent of the Riverside Clinic's radiology work. Riverside Hospital has been known as an established diagnostic center. Witnesses for Riverside Hospital

   testified that if they were not able to have a CAT scanner their reputation and ability to provide first class service would be seriously diminished.

   
   

9. CAT scanners represent a significant development in diagnostic medicine. They reduce the need for many dangerous, painful and costly injections of dye, air and radioactive isotopes required by some of the more traditional diagnostic procedures. The three most common tests displaced by CAT scanners are pneumoencephalography, angiography and radioactive isotope scanning. The first two of the foregoing are particularly expensive procedures and require hospitalization. At present, patients at the three Petitioner hospitals have to be transported to another facility in order to use a scanner. The transfer of an inpatient to another hospital for a scan may effectively consume the better part of a patient's day and may require an extra day of hospitalization. The cost of transportation, increased hospital stay and ancillary matters increase the actual cost to the Patient. Patients suffering from severe trauma or otherwise in a critical state, may not be transported out of a hospital to a scanner.

   
   

10. All three of the Petitioners have an active neurological and neurosurgical staff and qualified radiologists. The unrebutted testimony indicates that, although CAT scanners are a new development whose potential has not yet been fully explored and whose development may not yet be final, they nevertheless have become an essential diagnostic tool of regular use.

    
    

    CONCLUSIONS OF LAW

    
    

11. There are no specific criteria established by the State for the determination of need for a CAT scanner. The evidence presented by Petitioners indicates that a whole body scanner is a safer diagnostic tool than those procedures which it replaces. The evidence further indicates that a whole body scanner gives as good or better diagnostic information than the procedures it replaces. The evidence further establishes that the existing CAT scanners in Jacksonville are being used at their maximum effective capacity as that is defined by Respondent and that each of the Petitioner hospitals reasonably projects a need for more than 1,000 CAT scans per year.

    
    

12. It is noted that Section 101-1.03(D)(5), F.A.C., states that "recommendations made by Areawide Health Planning Councils will not be overridden lightly in the event of a disagreement between the Council and the DPA." The emphatic recommendation of the Areawide Health Planning Council, endorsed by the State Hospital Advisory Council, was to grant the application for certificate of need to each of the Petitioners herein.

Therefore, it is hereby RECOMMENDED that based upon the Findings of Fact and Conclusions of Law cited above, the determination of the Office of Community Medical Facilities to deny Petitioners' capital expenditure proposals for CAT scanners be reversed.

Respectfully submitted and entered this 28th day of March, 1977, in Tallahassee, Florida.

CHRIS H. BENTLEY

Hearing Officer

Division of Administrative Hearings Room 530, Carlton Building

COPIES FURNISHED:

Eric Haughdahl, Esquire Department of Health and Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32301

Kenneth F. Hoffman, Esquire P. 0. Box 1872

Tallahassee, Florida 32302

Tallahassee, Florida 32304

(904) 488-9675

Docket for Case No: 76-001945

Orders for Case No: 76-001945