STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
HEALTH CARE AND RETIREMENT ) CORPORATION OF AMERICA, d/b/a ) HEARTLAND OF PALM BEACH, )
)
Petitioner, )
)
vs. ) CASE NO. 84-3337
)
DEPARTMENT OF HEALTH AND )
REHABILITATIVE SERVICES, )
)
Respondent. )
)
RECOMMENDED ORDER
The final hearing in this case was held on April 3 and 4, 1986, in West Palm Beach, Florida. Representing the parties were:
For Petitioner: G. Steven Pfeiffer, Esquire
Kenneth A. Hoffman, Esquire Laramore & Clark
325 North Calhoun Street Tallahassee, Florida 32301
For Respondent: Harden King, Esquire
Department of Health
and Rehabilitative Services 1323 Winewood Boulevard
Tallahassee, Florida 32301
The sole issue in this case is whether there is a need for 120 community nursing home beds in Palm Beach County pursuant to rule 10-5.11(21), Florida Administrative Code.
The parties submitted a prehearing stipulation which was received into evidence as Hearing Officer's Exhibit 1. The Petitioner submitted 7 exhibits, which were received into evidence, and the Respondent entered 8 exhibits into evidence.
To complete the record, on the Hearing Officer's own motion following the conclusion of the final hearing, the Joint Motion for Continuance filed by both parties on January 22, 1986, has been received into evidence as Hearing Officer Exhibit 2.
The Petitioner called the following witnesses: Joyce Farr; Milo T. Bishop, expert in health planning; Paul G. Sieben, expert in design and construction of long term care facilities; James W. Alexander, expert in nursing home
administration; Margo Roth; Barbara Jacobowitz; Eugene Loeser, M.D., expert in medical neurology, including care and treatment of patients suffering from Alzheimer's disease; Mary Barnes; and Linda Boyer, expert in gerontological nursing.
The Respondent called as a witness Joyce Farr, expert in certificate of need review.
References to the transcript will be to "T." followed by the page number.
An appendix is included as a part of this Recommended Order explicitly stating reasons for the rejection of findings of fact proposed by the parties.
FINDINGS OF FACT
In April, 1984, the Petitioner, Health Care and Retirement Corporation of America d/b/a Heartland of Palm Beach, applied for a certificate of need for
120 community nursing home beds in Palm Beach County, Florida. In July, 1984, the Respondent, the Department of Health and Rehabilitative Services (HRS) gave notice of initial intention to deny the application. HRS Exhibit 5. The instant proceedings are the result of the request of the Petitioner for a formal administrative hearing from that denial. On January 22, 1986, the parties jointly moved for a continuance of the final hearing in this case then scheduled to commence on February 3, 1986, and in paragraphs 3 through 6, represented that the purpose of the requested continuance was to allow the Petitioner to gather data as to two alleged underserved groups: patients suffering from Alzheimer's disease and sub-acute care patients. The Petitioner asserted that such data would support an amended, updated application for certificate of need to be filed by the Petitioner for the purpose of showing need pursuant to the special exception allowed in the rules. In paragraph 8 of the motion, HRS agreed to give serious consideration to the updated application and supporting documents. The motion was granted by order dated February 3, 1986, and at the request of both parties, the final hearing was reset for April 3, 1986.
The parties have agreed that all statutory and rule criteria have been satisfied by the Petitioner in this case except for the issue of need as determined by rule 10-5.11(21), Florida Administrative Code, and that question is the sole issue in this case. T. 5; Hearing Officer Exhibit 1.
Petitioner's initial application did not mention the intention to provide special services for victims of Alzheimer's disease, and the Petitioner did not amend or update its application with HRS in that respect, except to the extent that it presented such testimony in the formal administrative hearing.
T. 104. The application is not in evidence. The initial review of Petitioner's application by HRS did not consider special services to Alzheimer's patients.
T. 117; HRS Exhibit 5.
HRS has adopted rule 10-5.11(21), Florida Administrative Code, to determine need for additional community nursing home beds. Using a planning horizon of 1987, which is 3 years after the date of application, the rule calculates a net surplus of 511 community nursing home beds for Palm Beach County. Even using the 1989 planning horizon, there is still a net zero bed need using the rule formula for Palm Beach County. T. 100; HRS Exhibit 2; T. 97 and 102.
Alzheimer's disease is a degenerative process of the brain characterized primarily by loss of memory and impairment of a variety of routine
functions. T. 160-161. Diagnosis of the disease is difficult since there are related degenerative mental disorders. Moreover, positive diagnosis typically requires examination of brain tissue, and the process of obtaining brain tissue is intrusive. T. 162-163. For these reasons, the diagnosis is typically of "senile dementia of the Alzheimer-type," or Alzheimer's disease or related disorders. T. 163. The cause of the condition is not known, although research into possible surgical techniques to ameliorate the effects is being conducted in the Jupiter, Florida, area. T. 73. Alzheimer's disease primarily afflicts elderly persons, although some younger persons may also be victims. T. 163.
Person suffering from Alzheimer's disease typically have memory loss, communicative problems, aphasia, trouble understanding, confusion, disorientation, inability to recognize care givers, waking at night, interrupting the care giver's sleep, wandering, mealtime problems, inappropriate sexual activity, incontinence, and social disfunctions. T. 184. Such persons exhibit negative behavior such as resistence to care, demanding, aggression, anger, emotional outbursts due to inability to perform routine tasks, and delusions. Id.
Four stages of progressive degeneration are expected with Alzheimer's disease. The first is forgetfulness and loss of ability to perform complex tasks which formerly could be performed. In the second stage, communication problems occur and also loss of memory as to the names of common objects. Wandering and becoming lost also may occur. Stage three is characterized by physical deterioration such as loss of weight, incontinence, and loss of control of other bodily functions. In the fourth stage, a patient will become unable to communicate at all, and may become comatose and bedridden. The course of the disease is from 12 to 16 years or longer and can involve many of the problems described above. T. 217-218.
A family member is usually the person first required to provide care for an Alzheimer's victim. T. 165. The responsibilities caused by such care, and the manner in which the symptoms of Alzheimer's disease are exhibited, cause the family care-giver to feel trapped, fatigued, depressed, angry, resentful, and frustrated. T. 167. At times, the family care-giver is elderly and can suffer health problems from the responsibility. T. 82-83. The burden upon the family member can be alleviated by day care, which involves care only during the day, and respite care, which can involve overnight care for several days.
T. 167, 147-148. Day care and respite care can also serve the function of establishing a relationship with staff and collection of data and records, both of which become useful for the time when the patient's disease progresses to the point that continuous inpatient care is required. T. 83, 220-223.
Alzheimer's patients in a nursing home need special care directed toward their particular disability described above. Of primary concern is that the nursing home be structured to provide an environment that minimizes confusion and compensates for the disabilities of the Alzheimer's disease victim. Separation from other elderly residents, who are not cognitively impaired, is important to prevent confusion of the Alzheimer's patient and to protect the other residents from disruptive intrusions. The physical facility should be constructed and furnished so as to minimize confusion and stimulation. Colors should be subdued, flooring should not mute the sound of footsteps, patterns should not be used, and common appliances should have distinguishing shapes and be clearly identified or labeled. Spaces for quiet and for wandering should be provided. Features to compensate for forgetfulness, such as lights which automatically turn on when a door is opened, should be provided. T. 219- 227, 57-58, 63-64, 81. Staffing must be trained to recognize and help alleviate
problems that arise from behavior caused by Alzheimer's disease. T. 74-75, 234- 235, 80, 83-84. Finally, since Alzheimer's disease patients become upset with change due to recognition and memory impairment, continuity of care (staffing and physical surroundings) becomes important. T. 221, 223, 78, 82-83.
Alzheimer's disease victims who need inpatient care also need all of the normal forms of skilled nursing care that other elderly persons need. This may occur over a course of years, or may be the results of a sudden injury, such as a broken hip. T. 220-223, 147-148, 79. As discussed above, it is important to be able to provide such care in the same facility since continuity of care is so important, and transfers to new surroundings are disruptive.
Any current holder of a certificate of need for community nursing home beds in Palm Beach County may, if it wishes, provide special services to persons suffering from Alzheimer's disease. T. 122. Existing nursing homes in Palm Beach County accept Alzheimer's disease victims, but none provide special services for these patients except perhaps Darcy Hall, which provides adult day care. T. 143, 76, 82, 168-169, 171, 200-201, 210-211. Existing adult congregate living centers and adult day care centers in Palm Beach County similarly do not have special services or programs for victims of Alzheimer's disease. T. 145. Existing nursing homes could provide such services to Alzheimer's patients, though approval of HRS by expedited review to change substructure might be required, but none has done so. T. 154. Alzheimer's patients are often inappropriately restrained, or mixed with non-Alzheimer's disease patients. T. 77.
Dr. Eugene Loeser is a physician, board certified in neurology, and is in private practice in Jupiter, Florida. T. 157-158. Dr. Loeser created a list of questions to ask physicians in Palm Beach County to explore the need for special nursing home programs for Alzheimer's disease patients, and that list of questions is HRS Exhibit 8. T. 169, 186-189. Using these questions Dr. Loeser conducted a survey of 36 physicians in Palm Beach County, which included 8 family practitioners, 10 internists, 14 neurologists, 2 neurosurgeons, and 2 psychiatrists. T. 170. There are approximately 1,000 physicians in Palm Beach County, T. 31, and Dr. Loeser admitted that his survey was only of a small percentage. T. 170. Dr. Loeser did not attempt to make the survey statistically valid. T. 178. The physicians contacted were selected from the telephone book from Jupiter in the north to Lake Worth in the south. T. 171,
183. Dr. Loeser attempted to contact representatives of several specialities.
T. 181. The specialities were selected as those likely to see Alzheimer's patients. T. 170. Of the 36 physicians contacted, 35 had seen patients having Alzheimer's disease. Petitioner's Exhibit 5. Of these, 27 physicians had "difficulty in finding appropriate placement" for these patients in terms of supervision, care and treatment. Petitioner's Exhibit 5; HRS Exhibit 8. The same number of physicians felt that facilities with appropriate programs for placement of Alzheimer's disease or similar disorder patients were not presently available in Palm Beach County. Id. From the responses, Dr. Loeser estimated that these physicians had seen somewhat more than 600 patients suffering from Alzheimer's disease or related disorders in the last year. T. 171. Dr. Loeser personally estimated that he typically had difficulty finding a treatment and care facility for about 10 Alzheimer's disease patients annually. T. 185. He then estimated from responses received that the physicians surveyed were unable to find an appropriate program for about 135 patients annually. Petitioner's Exhibit 5. Dr. Loeser further estimated that among his own patients, about one or two per week needed some form of day care, T. 185, and from the responses of the physicians in the survey, estimated that such physicians annually had 150 patients needing day care. T. 175.
Determination of placement problems for Alzheimer's disease patients from actual patient records or placement orders from physicians would be difficult because these records are confidential. Consent from the patient would be needed, and consent from an Alzheimer patient would be difficult due to the nature of the mental impairment caused by the disease. T. 173.
The survey conducted by Dr. Loeser was not unreasonable for failure to contact more physicians. The survey accurately reflects a group of Alzheimer's disease patients treated by the physicians contacted, and does not purport to account for Alzheimer's disease patients treated by other physicians. Thus, the need identified by Dr. Loeser's survey, while underinclusive of total need, is reasonably accurate for the need identified.
Palm Beach County currently has at least an estimated 16,597 persons suffering from Alzheimer's disease, and this number is expected to be 18,172 by 1988. T. 24. HRS itself estimates that the number of Alzheimer's victims in Palm Beach County in 1986 to be 27,200. Petitioner's Exhibit 6. It is further estimated that approximately 80 percent of such patients will require some sort of custodial care in the future. T. 76.
Based upon the foregoing statistics, as well as the fact that existing Palm Beach County nursing homes do not provide special services or care for Alzheimer's disease patients, there is a need for the Alzheimer facility proposed by the Petitioner.
The Petitioner proposes to establish a 120 bed nursing home in Palm Beach County designed and staffed to provide care and treatment to meet the special needs of persons suffering from Alzheimer's disease and related disorders. T. 45. The Petitioner, Health Care and Retirement Corporation of America, d/b/a Heartland of Palm Beach, is willing to have any certificate of need issued in this case to be conditioned upon it building, developing, and operating the proposed nursing home limited as it has proposed in this formal administrative hearing. T. 48-49. Thus, findings of fact 18 through 21 which follow relate to the manner in which the Petitioner proposes that a certificate of need may be conditioned and limited.
The proposed physical design of the nursing facility is set forth in Petitioner's Exhibit 1. T. 49. The cost is estimated to be $3.7 million. T.
The design includes a courtyard to allow patients to wander safely. T. 41. It also includes a shaded porch, an outdoor patio, and a lounge off the patio. Id. Security from wandering is proposed to be provided by a "Wanderguard" system of wristbands and sensing devices that sound an alarm as a patient passes an exit point. Id. Additionally, the proposed facility would have a therapeutic residential kitchen for patients still able to use a residential kitchen. Id. One room would be set aside as a quiet room. T. 42. It is contemplated that such a room will minimize the need for calming drugs. T. 224. Also to be provided are separate dining areas, areas for therapy, and separate nursing wings and sub-acute care wings. T. 42-43. Alzheimer patients would be separated from non-Alzheimer patients, fixtures would have shapes, colors, and labels to facilitate identification; wall and floor coverings would not use patterns, and the flooring would be vinyl or tile instead of carpet. T. 42,
225-228. The proposed plan of the facility contemplates that there be space for all stages of care for Alzheimer's patients: day care, respite care, nursing care, and sub-acute care. Petitioner's Exhibit 1; T. 221-222, 39-40, 56.
The Petitioner also proposes to provide individual treatment plans, to include physical therapy, occupational therapy, social work, and recreational therapy. T. 230-231. Support groups for family members of the patient will be provided. T. 233.
The Petitioner states that the staff for the proposed facility must be appropriately trained to know Alzheimer's disease and the special needs of these patients. T. 234. Ongoing education for staff is viewed as being imperative. Id. The Petitioner recognizes the need to provide greater staffing for peak periods. T. 235. Monthly in-service training will be provided by the parent corporation. T. 236. Moreover, the parent corporation, Health Care and Retirement Corporation of America, will develop and implement a program of staff training specifically for Alzheimer's disease. T. 237. Staff for the proposed facility will be adequately trained to properly deal with the problems of Alzheimer's patients. For a 24 hour period, a staff to patient ratio of 1 to
2.5 will be provided. T. 238. This ratio includes only nursing staff, aides, and activities and occupational rehabilitation staff. Id.
The Petitioner proposes to designate and commit its entire facility to Alzheimer's patients. T. 60. But from a fiscal point of view, the Petitioner proposes to not deny admission to persons not having Alzheimer's disease. T.
66-68. At least 60 beds will be dedicated to patients with Alzheimer's disease, and these are expected to fill with persons in stages two and three of the disease. T. 67-68. When these patients reach more advanced stages of their disease, it is expected that they will be treated in the other 60 bed section, which is skilled nursing and sub-acute care. T. 68; Petitioner's Exhibit 1.
Thus, the Petitioner expects ultimately to fill its entire facility with Alzheimer's disease patients consistent with its dedication and purpose.
The facility proposed by the Petitioner would meet the unique needs of Alzheimer's disease patients and their families, and would be the only facility in Palm Beach County to provide a wide spectrum of care for Alzheimer's disease patients.
Petitioner's proposal is consistent with priorities IV, V 3 and 4, and VI, Long Term Care section, District IX Health Plan (1985). T. 150-152.
On March 6, 1986, the General Counsel of the Department of Health and Rehabilitative Services sent a memorandum to "all attorneys" construing and implementing the decision in the Gulf Court case, Gulf Court Nursing Center v. DHRS, 10 F.L.W. 1983 (Fla. 1st DCA 1985). On the next day, Robert E. Maryanski, Administrator, Community Medical Facilities, Officer of Health Planning and Development, sent the memorandum to his staff and told them to use the opinion as a guideline for the initial review of a CON application settlement and preparation for hearings. HRS Exhibit 6.
HRS recognizes that there are three ways that an applicant for a certificate of need for nursing home beds can show need even though the rule shows a zero bed need. The third way is for "equivalent assessments" to be submitted by "attending physician." T. 113; HRS Exhibit 4, rule 10- 5.11(21)(b)10, F.A.C.
HRS staff construes rule 10-5.11(21)(b)10, F.A.C., as requiring that each attending physician of each Alzheimer's patient document that his or her patient is in need of specialized services and that the patient is without access to those special services. T. 124.
The issuance of certificate of need 4194 to the Joseph L. Morse Geriatric Center was issued pursuant to the special circumstances exception of rule 10-5.11(21)(b)10, F.A.C., since the rule did not show bed need. T. 127. There was nothing in the application in that case to show that elderly Jewish persons were denied access to existing nursing home facilities in Palm Beach County. Id. See also T. 130. There was, however, evidence that a large group of elderly Jewish persons were not being provided kosher dietary services at existing nursing homes. T. 129, 134. This evidence was not presented by attending physicians, however. T. 136.
The certificate of need 4194 to the Joseph L. Morse Geriatric Center was also approved using priority VI, long term care section, District 9 local health plan, which provides in the second sentence for consideration of "ethnic- type services including special dietary requirements . . . ." HRS Exhibit 7; T. 134.
Due to changes in federal funding, patients needing sub-acute care (less than hospital care, but more than an ordinary nursing home) do not qualify for cost reimbursement. T. 85-88. It appears that about one-half of all nursing home admissions in Palm Beach County are for three months or less. This may be a pool of persons needing sub-acute care. Petitioner's Exhibit 3, Long Term Care Section, page 4; T. 27-28. There was other general testimony that there was a "need for sub-acute care in Palm Beach County, T. 88, 146, and the local health plan, priority V 4, page 31, supports the grant of a certificate of need to an applicant that will provide such care. Petitioner Exhibit 3. There is also a need for sub-acute care in the final stages of Alzheimer's disease to provide continuity of care. T. 221. See also finding of fact 10.
No one has petitioned to intervene in this case.
CONCLUSIONS OF LAW
Jurisdiction exists pursuant to section 120.57(1), Florida Statutes.
There is no need for additional nursing home beds in Palm Beach County using the method for projecting such need contained in rule 10-5.11(21), Florida Administrative Code. That rule, however, contains an exception in subparagraph
(b) 10:
"10. In the event that the net bed allocation is zero, the applicant may demonstrate that circumstances exist to justify the approval of additional beds under the other relevant criteria specifically contained in the Depart- ment's Rule 10-5.11. Specifically, the appli- cant may show that persons using existing and like services are in need of nursing home care but will be unable to access nursing home services currently licensed or approved within the subdistrict. Under this provision, the applicant must demonstrate that those persons with a documented need for nursing home services have been denied access to currently licensed but unoccupied beds or that the number of persons with a documented need exceeds the number of licensed unoccupied and currently
approved nursing home beds. Existing and like services shall include the following as defined in statute or rule, adult congregate living facilities, adult foster homes, homes for special services, home health services, adult day health care, adult day care, community
care for the elderly, and home care for the elderly. Patients' need for nursing home care must be documented by the attending physicians' plans or care or orders, assessments performed by staff of the Department of Health and Reha- bilitative Services or equivalent assessments performed by attending physicians indicating need for nursing home care.
The Petitioner seeks to prove entitlement to a certificate of need under this subparagraph, and in so doing, seeks to present evidence as to need for services for Alzheimer's and sub-acute care patients. These issues were not raised in Petitioner's application. From the beginning of the hearing, HRS objected to admission of any evidence different from the initial application of the Petitioner. T. 8. HRS has maintained that objection in its proposed findings of fact and conclusions of law, arguing that any evidence as to services to be provided to Alzheimer's and sub-acute patients is irrelevant and inadmissible for that reason. Since the objection came at the beginning of the hearing, ruling upon it was postponed until this recommended order. T. 11.
Section 381.494(4), Florida Statutes, mandates that every application for a certificate of need contain "a detailed description of the proposed project and statement of its purpose and need . . . ." The Respondent argues that due to the provisions of this statute, evidence presented by the Petitioner different from matters set forth in the initial application is irrelevant and inadmissible.
It should further be noted that the decision of the Department of Health and Rehabilitative Services to grant or deny a certificate of need is explicitly tied to review of the application. Section 381.494(8)(c), Florida Statutes. Moreover, the "detailed description of the proposed project" that is supposed to be in the application becomes critical for determining the nature of the certificate of need to be granted. Section 381.494(8)(g), Florida Statutes, provides that the Department of Health and Rehabilitative Services "may issue a certificate of need predicated upon statements of intent expressed by an applicant in the application . . . ." (E.S.) The subparagraph further provides that the Department may initiate an action for specific performance, fines, or injunctive relief, for "failure of a holder of a certificate of need to substantially comply with statements of intent made in the application and relied upon by the department as set forth in the certificate "
The Department also argues that Section 381.494(5), Florida Statutes, requires the applicant to file a letter of intent with the local health council and the Department at least thirty days before filing the application, and argues that this requirement is intended to give existing providers (or others, for that matter) a chance to compete in the same batching cycle. The Department further argues that Section 381.494(6)(b), Florida Statutes, authorizes a public hearing upon request of an affected person, and that important information needed to consider the application is to be made available to the local
community and local health council by means of such a public hearing. The Department concludes that the action of the Petitioner in this case, changing its proposed project before the final hearing, has thwarted the purpose of these statutes.
The objections of the Department should be rejected for several reasons. First, it should be noted that Petitioner submits evidence of need to serve Alzheimer and sub-acute care patients under the community nursing home rule, Rule 10-5.11(21), Florida Administrative Code, the same rule that was the foundation for Petitioner's initial application. The only new element is that Petitioner seeks approval of its application by showing that there is a "not normal" condition in Palm Beach County. Rule 10-5.11(21), like many other certificate of need rules, has a "not normal" exception in subparagraph (a) of the rule. When an applicant applies for a certificate of need under a particular rule, the Department, other applicants in the same batching cycle, and existing providers are on notice that approval of the application may occur under any section of the community nursing home rule, including the "not normal" circumstance. Rule 10-5.11(21) is somewhat different from other rules in that it contains more explicit guidelines for determining exceptional circumstances (subparagraph (b) 10 of the rule), but the effect is the same: the application need not be remanded to HRS when the applicant seeks to prove entitlement under the "not normal" portion of the rule, even though the initial application did not mention this basis for approval. Stated another way, the application still is lodged under the community nursing home rule, and proof of "not normal" conditions is not a substantial change in the application.
Moreover, this case is procedurally unique. In the joint motion to continue (see finding of fact 1), the Respondent acknowledged that the Petitioner needed the continuance to gather data as to two allegedly underserved groups: Alzheimer and sub-acute care patients. In this stipulation, the Department promised to give serious consideration to any updated application and supporting documents. Thus, with respect to the question of notice to the Respondent, and the opportunity for the Respondent to consider Petitioner's proposal as amended, it appears that the Respondent waived any procedural irregularity and affirmatively chose to consider the amended proposal through evidence presented at the formal hearing.
Finally, the Petitioner in this case has promised to limit its activities under any certificate of need to those services it has represented in this proceeding that it would provide. See finding of fact 17. By so doing, the requirements of Section 381.494(8)(g), Florida Statutes, that the certificate of need be limited to "statements of intent expressed by an applicant in the application" is satisfied.
Thus, the objections of the Respondent to the admission of evidence due to relevancy are overruled.
The exception contained in subparagraph (b) 10 of Rule 10-5.11(21) is not a model of clarity. The second sentence contains a contradiction:
Specifically, the applicant may show that persons using existing and like services are in need of nursing home care but will be un- able to access nursing home services currently licensed or approved within the subdistrict. (E.S.)
The next sentence purports to limit proof to two circumstances:
. . . that those persons with a documented need for nursing home services have been denied access to currently licensed but un- occupied beds or that the number of persons with a documented need exceeds the number of licensed unoccupied and currently approved nursing home beds.
The second sentence does not address the question of a person already "using" an existing nursing home service, but denied services that are needed. In order that both sentences be given force and effect, the first sentence must be construed as containing an additional circumstance justifying approval of an application despite a zero bed need: when a group of persons are currently using existing nursing home beds, but existing nursing home services fail to adequately serve their unique health needs. If an existing nursing home bed fails to provide adequate services, it certainly does not exist for the patient in question; and even though the patient may be "using" that bed he or she is effectively "denied access" to needed nursing home services in that exceptional circumstance.
The foregoing interpretation of the rule is mandated by Balsam v. Department of Health and Rehabilitative Services, 486 So.2d 1341 (Fla. 1st DCA 1986). In the Balsam case, HRS had determined the adequacy of care of existing facilities by simply looking to see if such facilities were licensed and accredited. The Court ruled that this might be a good starting point, but to limit consideration of adequacy of care to only those factors was contrary to the statutory duty that HRS consider evidence of "availability, quality of care, efficiency, appropriateness, accessibility, extent of utilization, and adequacy of like and existing health services . . . ." This is a requirement of Section 381.494(6)(c)2, Florida Statutes, (1985). Rule 10-5.11(21)(b)10, Florida Administrative Code, must not be construed to preclude evidence that existing community nursing homes fail to provide appropriate, adequate, efficient, or high quality care for Alzheimer or sub-acute care patients, for to do so would be contrary to the reasoning of the Balsam case and the statute.
The Respondent asserts that the effect of the last sentence of subparagraph (b) 10 of Rule 10-5.11(21) is to provide only two ways to prove exceptional need: by office files of attending physicians or by an HRS assessment. This is not correct. The last sentence states:
Patients' need for nursing home care must be documented by the attending physicians' plans of care or orders, assessments performed by staff of the Department of Health and Rehabi- litative Services, or equivalent assessments performed by attending physicians indicating need for nursing home care. (E.S.)
The third method clearly contemplates something other than "attending physicians' plans of care or orders," and must mean some sort of survey equivalent to the types done by HRS. This is particularly true since collection of actual medical records and physicians' orders is in fact difficult in this case. See finding of fact 13.
The assessment conducted by Dr. Loeser was the equivalent of assessments commonly done by HRS. Though not statistically complete, the survey was clearly accurate enough to obtain rough estimates of the needs of patients of those physicians contacted. See findings of fact 12 and 14.
The potential pool of Alzheimer's patients in 1986 in Palm Beach County needing some sort of custodial care, whether day care, respite care, or nursing home inpatient care, is roughly 80 percent of at least 18,000, or 14,400. Finding of fact 15. This figure is low, however, since HRS itself estimates that there are now 27,200 Alzheimer patients in Palm Beach County. Id.
The needs of these patients are not being adequately served by existing community nursing homes in Palm Beach County. Last year, at least 135 Alzheimer's disease patients of 35 Palm Beach County physicians could not be placed in an adequate program in the county. Finding of fact 12. Persons who should be in the best position to assess the adequacy of existing nursing homes to care for Alzheimer's patients (Barbara Jacobwitz, senior health planner for the local district, who wrote the health plan, and Mary Barnes, administrator for the Palm Beach County Chapter of the Alzheimer's Disease and Related Disorders Association) testified that existing nursing homes do not provide any special services for Alzheimer's patients, and inappropriately restrain and mix such patients with other residents of the nursing home. Finding of fact 11. Alzheimer's disease patients need special services for adequate care. Finding of fact 9.
Given the large numbers of Alzheimer's victims and the total lack of appropriate nursing home services in Palm Beach County, it must be concluded that there is a need for at least 120 community nursing home beds dedicated to Alzheimer's victims.
The Petitioner did not demonstrate that there is a need for 30 ordinary nursing home beds on a long range basis. See finding of fact 4. While the Petitioner stated that it intended to not deny admission to non-Alzheimer patients in the short term due to "fiscal reasons," the Petitioner did not submit explanatory evidence of such fiscal needs. Since it is clear that there is no need for 30 ordinary nursing home beds for the long run, and since there is no evidentiary basis upon which to premise a temporary grant of ordinary nursing home beds, the portion of the application seeking approval of 30 ordinary nursing homes beds should be denied as not supported by need.
The Petitioner's proof of need with respect to 30 sub-acute care beds was not sufficient for the grant of this portion of a certificate of need. Although there was some general evidence of need, see finding of fact 29, there was no credible evidence that existing nursing homes were failing to meet this particular need except with respect to Alzheimer's patients, as to which there was a general failure of service. There was sufficient evidence that Alzheimer's patients will eventually need various kinds of sub-acute care and that such care should be provided in the same facility to preclude the trauma associated with a move to strange surroundings. Thus, approval of 30 sub-acute care beds should be granted but limited to Alzheimer's disease patients so that continuity of care may be achieved. Unrestricted approval of sub-acute care beds should be denied.
Based upon the foregoing, it is recommended that the Department of Health and Rehabilitative Services, pursuant to Rule 10-5.11(21)(b)10, Florida Administrative Code, and Section 381.494(8)(c), Florida Statutes, issue a certificate of need to Health Care and Retirement Corporation of American, d/b/a Heartland of Palm Beach, for 120 community nursing home beds limited and conditioned upon all such beds being dedicated only to the provision of such services and facilities for victims of Alzheimer's disease as described by the Petitioner in this case and set forth in findings of fact 18 through 21 of this order, with 30 of such beds established for sub-acute care needs of Alzheimer's disease patients. It is further recommended that the certificate of need not contain approval for general community nursing home beds, but be limited to Alzheimer's disease patients.
DONE and ORDERED this 8th day of July, 1986, in Tallahassee, Florida.
WILLIAM C. SHERRILL, JR.
Hearing Officer
Division of Administrative Hearings The Oakland Building
2009 Apalachee Parkway
Tallahassee, Florida 32399-1550
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 8th day of July, 1986.
APPENDIX TO RECOMMENDED ORDER, CASE NO. 84-3337
Pursuant to section 120.59(2), Fla. Stat., the following are specific rulings upon all proposed findings of fact submitted by the parties which have been rejected in this Recommended Order.
Findings of Fact Proposed by the PETITIONER:
7. Sentences 3 and 4 have been rejected because the evidence was not sufficiently complete to describe nursing homes in Florida in general, and because the issue in this case is the need in Palm Beach County, thus making these proposed facts not relevant.
10. Sentence 3 is rejected since the testimony did not clearly show that therapeutic kitchens "should be available."
13. Sentences 9 and 10 are rejected because the evidence did not categorically show that it "would not be possible" to use actual physician orders, or that "physicians do not typically arrange their records so that orders of that kind could be extracted from their records." Similarly sentence
12 is rejected for lack of categorical evidence to prove impossibility.
17. Evidence that the entire facility is "completely fenced and enclosed" cannot be located in the record, and thus sentence 7 is rejected.
The bulk of the discussion in proposed finding of fact 20 has been rejected because it is argument or conclusions of law.
Those portions of this proposed finding which propose a finding that the Respondent's interpretation of rule 10-5.11(21)(b)10, Florida Administrative Code, is wrong or unreasonable are rejected as argument or conclusions of law. Most of the factual statements were adopted.
Findings of Fact Proposed by the RESPONDENT:
All proposed findings of fact by the Respondent have been adopted in substance.
COPIES FURNISHED:
Harden King, Esquire Assistant General Counsel Department of Health
and Rehabilitative Services 1323 Winewood Boulevard Building One, Suite 407 Tallahassee, Florida 32301
Kenneth A. Hoffman, Esquire
G. Steven Pfeiffer, Esquire Laramore & Clark, P.A.
325 North Calhoun Street Tallahassee, Florida 32301
William Page, Jr.
Secretary
Department of Health
and Rehabilitative Services 1323 Winewood Boulevard
Tallahassee, Florida 32301
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AGENCY FINAL ORDER
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STATE OF FLORIDA
DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES
HEALTH CARE AND RETIREMENT CORPORATION OF AMERICA, d/b/a HEARTLAND OF PALM BEACH,
Petitioner, CASE NO. 84-3337 CON NO. 3286
vs.
DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES,
Respondent.
/
FINAL ORDER
This cause came on before me for the purpose of issuing a final agency order. The Hearing Officer assigned by the Division of Administrative Hearings (DOAH) in the above-styled case submitted a Recommended Order to the Department of Health and Rehabilitative Services (HRS). A copy of that Recommended Order is attached hereto.
FINDINGS OF FACT
The Department hereby adopts and incorporates by reference the findings of fact set forth in the Recommended Order with the exception of paragraph 16. The finding of need based on exceptional circumstances is a conclusion of law and is rejected for reasons explained below.
CONCLUSIONS OF LAW
The Department hereby adopts and incorporates by reference the conclusions of law set forth in the Recommended Order except as follows:
The hearing officer erred in allowing petitioner to proceed on the basis of an amended application which substantially changed the character of the nursing home proposed by petitioner. Between the time petitioner filed its original application and the date of the final hearing in this case there was a major change in the law ushered in by the opinion of the District Court of Appeal in Gulf Court Nursing Center v. DHRS et. al. 483 So 2d 700 (Fla. 1st DCA 1986).
Before Gulf Court full de novo review was allowed in a 120.57 hearing wherein an applicant challenged the denial of a CON. Application [unreadable text] amended up to and including the time of the final 120.57 hearing; often ties, changing greatly the character and scope of the original proposal. Gulf Court pointed out that this policy along with the "first in line, first in right" policy of
awarding CONs encouraged the "buy a ticket and stand in line" behavior of health care providers, resulting in needless applications, administrative reviews, and litigation.
In contrast under Gulf Court the planning horizon is fixed by the filing date of the original application. Now that de novo review has been limited by Gulf Court there is no longer any authority in statute, rule, or policy permitting amendment of CON applications in 120.57 proceedings. There is no authority for amendments at any point after five (5) days from the date at which the decision is due on the application, See rule 10-5.08 (7)(a) and (b) and Gulf Court interprets "decision" to mean the initial HRS review Chapter 381.494, Fla. Stat. mandates a complete review by HRS on the basis of a complete application. The Division of Administrative Hearings is not a forum for the introduction of additional concepts which were not initially reviewed by HRS.
During 120.57 proceedings, an application may be updated to address facts extrinsic to the application such as interest rates, inflation of construction costs, current occupancies, compliance with new state or local health plans, and changes in bed or service inventories. An applicant is not allowed to update by adding additional services, beds, construction, or other concepts not initially reviewed by HRS.
The hearing officer suggested that HRS waived any objection to evidence concerning petitioners amended proposal because of the stipulation for a continuance dated January 22, 1986. The Gulf Court opinion on rehearing was not filed until February 14, 1986 and mandate was not issued until March 18, 1986.
Thus, there is no basis for a finding of waiver by HRS as Gulf Court was not law at the time of the stipulation for continuance. The final hearing was held on April 3 & 4, 1986 and at that point in time HRS was obligated to comply with Gulf Court and could not waive its requirements.
Even if petitioners amended application could be considered, there is an additional reason for denial of the CON sought by petitioner. Petitioner's nursing home would add 120 beds to surplus of 511 beds in Palm Beach County and petitioner proposes to admit persons not suffering from Alzheimers disease for "fiscal" reasons. The hearing officer found that existing nursing homes presently accept Alzheimers patients and that any current holder of a CON for nursing home beds in Palm Beach County may provide special services to Alzheimers patients. The hearing officer also found that existing nursing homes could provide the services proposed by petitioner, though in some instances approval by HRS might be required.
In the face of the surplus of nursing home beds in Palm Beach County, modification and utilization of existing facilities would be a more appropriate use of health care resources. If there is in fact consumer demand for such services proposed by petitioner, such modifications can be expected.
Both the First and the Fourth District Courts of Appeal have held that a determination of need on the basis of exceptional circumstances is a conclusion of law and therefore within the permissive range of agency discretion. Humana Inc., d/b/a Cypress Community Hospital v. DHRS, opinion filed April 16, 1986, Case #84-2515 (Fla. 4th DCA); Federal Property Management v. DHRS, 482 So 2d 475 (Fla. 1st DCA 1986).
It is the conclusion of HRS based on a balanced weighing of all relevant criteria that petitioner's proposal is not needed.
Based upon the foregoing, it is
ADJUDGED, that petitioner's application for CON number 3286 to construct and operate a 120 bed nursing home in Palm Beach County, HRS District IX is denied.
DONE and ORDERED this 24th day of September, 1986, in Tallahassee, Florida.
WILLIAM J. PAGE
Secretary
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that a copy of the foregoing was sent to above-named people by U.S. Mail this 25th day of September, 1986.
R. S. Power, Agency Clerk Assistant General Counsel Department of Health and
Rehabilitative Services 1323 Winewood Boulevard Building One, Room 407
Tallahassee, Florida 32399-0700 904/488-2381
COPIES FURNISHED TO:
G. STEVEN PFEIFFER, ESQUIRE KENNETH A. HOFFMAN, ESQUIRE LARAMORE & CLARK
325 NORTH CALHOUN STREET TALLAHASSEE, FLORIDA 32301
WILLIAM C. SHERRILL, JR. HEARING OFFICER
DOAH, THE OAKLAND BUILDING 2009 APALACHEE PARKWAY
TALLAHASSEE, FLORIDA 32301
JOHN RODRIGUEZ
LEGAL REPRESENTATIVE 1323 WINEWOOD BOULEVARD BUILDING ONE, ROOM 407
TALLAHASSEE, FLORIDA 32399-0700
NELL MITCHEM (PDCFM) 1317 WINEWOOD BOULEVARD BUILDING TWO, ROOM 255
TALLAHASSEE, FLORIDA 32399-0700
A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF HRS, AND A SECOND COPY, ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.
| Issue Date | Proceedings |
|---|---|
| Jul. 08, 1986 | Recommended Order (hearing held , 2013). CASE CLOSED. |
| Issue Date | Document | Summary |
|---|---|---|
| Sep. 24, 1986 | Agency Final Order | |
| Jul. 08, 1986 | Recommended Order | Certificate Of Need denied. Cannot ammend application and substantially change character of project. De novo review limited by Gulf Court versus DHRS, 483 So. 2d 700. |
