STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
TARPON SPRINGS HOSPITAL ) FOUNDATION, INC., d/b/a HELEN ) ELLIS MEMORIAL HOSPITAL, )
)
Petitioner, )
)
vs. )
)
AGENCY FOR HEALTH CARE )
ADMINISTRATION, )
)
Respondent, )
)
and )
) THE MORTON F. PLANT HOSPITAL ) ASSOCIATION, d/b/a MORTON PLANT ) HOSPITAL and HCA HEALTH ) SERVICES OF FLORIDA, INC., ) d/b/a REGIONAL MEDICAL CENTER ) BAYONET POINT, )
)
Intervenors. )
Case No. 03-1425CON
)
RECOMMENDED ORDER
Pursuant to notice, the case was heard by Charles A. Stampelos, a duly-designated Administrative Law Judge at the Division of Administrative Hearings on September 27 and 28, October 3 through 7, and 10 through 13, 2005, in Tallahassee, Florida.
APPEARANCES
For Petitioner Tarpon Springs Hospital Foundation, Inc., d/b/a Helen Ellis Memorial Hospital:
Geoffrey D. Smith, Esquire Susan C. Hauser, Esquire Smith and Associates
2873 Remington Green Circle Tallahassee, Florida 32308
For Respondent Agency for Health Care Administration:
Timothy Elliott, Esquire
Agency for Health Care Administration 2727 Mahan Drive, Building 3
Mail Station 3
Tallahassee, Florida 32308
For Intervenor HCA Health Services of Florida, Inc., d/b/a Regional Medical Center Bayonet Point:
Stephen A. Ecenia, Esquire Rutledge, Ecenia, Purnell
& Hoffman, P.A.
215 South Monroe Street, Suite 420 Post Office Box 551
Tallahassee, Florida 32302-0551
For Intervenor The Morton F. Plant Hospital Association d/b/a Morton Plant Hospital:
Robert A. Weiss, Esquire Parker, Hudson, Rainer
& Dobbs, LLP
The Perkins House, Suite 200
118 North Gadsden Street Tallahassee, Florida 32301
STATEMENT OF THE ISSUE
The issue in this case is whether the Certificate of Need (CON) application filed by Tarpon Springs Hospital Foundation, Inc., d/b/a Helen Ellis Memorial Hospital in January 2003, to
establish an adult open heart surgery (OHS) program in Agency for Health Care Administration (the Agency or AHCA) Service District 5 should be approved.
PRELIMINARY STATEMENT
In the October 2002, batching cycle, the Agency published a zero (0) fixed need for adult OHS programs in District 5 for the January 2005 planning horizon. District 5 consists of Pinellas and Pasco Counties.
CON applications seeking approval to establish an OHS program in District 5 in the absence of a fixed need were filed by Mease Hospital-Countryside (Mease), St. Anthony's Hospital (St. Anthony's) and Helen Ellis. On February 28, 2003, the Agency issued a State Agency Action Report (SAAR) preliminarily denying each co-batched application.
Thereafter, Mease and Helen Ellis filed petitions requesting an administrative hearing to contest the Agency's preliminary determination. St. Anthony's abandoned its CON application.
Morton F. Plant Hospital Association d/b/a Morton Plant Hospital (Morton Plant), HCA Health Services of Florida, Inc., d/b/a Regional Medical Center Bayonet Point (Bayonet Point), and Largo Medical Center (Largo) filed petitions to intervene in the cases involving Helen Ellis and Mease. The separate cases involving Helen Ellis and Mease were consolidated for purposes
of final hearing. Mease voluntarily dismissed its petition and Largo voluntarily dismissed its petition to intervene.
On September 28, 2004, the Agency filed a notice of intent to approve Helen Ellis' CON application. The Agency withdrew its notice of intent to approve Helen Ellis' CON application on October 22, 2004; however, the Agency maintained its support for the Helen Ellis CON application.
On September 23, 2005, the parties filed an Agreed Joint Prehearing Stipulation.
The final hearing was held in Tallahassee, Florida, on September 27-28, October 3-7, and October 10-13, 2005.
During the final hearing, Helen Ellis called the following witnesses: Norm Stein, Chief Executive Officer of University Community Hospital, accepted as an expert in hospital administration; Brigitte Shaw, Chief Executive Officer of the Pepin Heart Hospital and Research Institute, accepted as an expert in hospital administration; Steve Maclauchlan, Chief Executive Officer of Helen Ellis, accepted as an expert in hospital administration; Peter P. Wozniak, Chief Operating and Patient Care Officer at Helen Ellis, accepted as an expert in hospital administration, patient care services, and nursing administration; John J. Dallman, M.D., accepted as an expert in family practice medicine; Thomas B. Ferguson, Jr., M.D., a cardiothoracic surgeon, accepted as an expert in cardiovascular
surgery; Marc B. Bloom, M.D., accepted as an expert in cardiovascular surgery; Thomas E. Carson, M.D., accepted as an expert in family practice and primary and geriatric care medicine; Lisa K. Nummi, R.N., associate patient care officer at UCH and accepted as an expert in nursing, including clinical care nursing; Norman Abbott, M.D., accepted as an expert in cardiovascular medicine; Najam Javeed, M.D., accepted as an expert in internal medicine, cardiovascular disease, and interventional cardiology; Cheryl Harrison, R.N., accepted as an expert in nursing, including coronary, cardiac, and critical care; Linda Wonderly, R.N., accepted as an expert in cardiovascular rehabilitation nursing; Lorie J. Farrell, R.N.; Christopher J. Bell, accepted as an expert in architecture and medical architecture; Daniel J. Sullivan, accepted as an expert in health care finance and financial feasibility analysis;
John D. Harbaugh, accepted as an expert in emergency room administration and emergency room nursing; and Gene Nelson, accepted as an expert in health care planning.
Helen Ellis (HE) Exhibits numbered 1-4, 6-49, and 51-64, including several deposition transcripts, were admitted into evidence.
The Agency's Exhibit numbered 1, the deposition transcript of Jeffrey Gregg, Chief of the Bureau of Health Facility
Regulation of AHCA, and the exhibits identified during Mr. Gregg's deposition, were admitted into evidence.
Morton Plant called the following witnesses: Michael D. Williamson, M.D., accepted as an expert in internal medicine, cardiovascular disease, and interventional cardiology;
Patrick A. Cambier, M.D., accepted as an expert in internal medicine cardiovascular disease, and interventional cardiology; Harrel Ziecheck, Chief Operating Officer, Morton Plant-Mease Healthcare, accepted as an expert in health care administration; Thomas Deal, M.D., accepted as an expert in cardiothoracic surgery; Elisha R. Miller, R.N., accepted as an expert in cardiovascular nursing and cardiovascular nursing management; Rick D. Knapp, accepted as an expert in health care accounting and finance; Mark M. Richardson, accepted as an expert in health care planning; and Joseph Carey, M.D., accepted as an expert in cardiothoracic surgery.
Morton Plant (MP) Exhibits numbered 1-22, 24-27, and 30 were admitted into evidence. Also, the deposition testimony of Conrad T. Kearns was admitted into evidence. Objections to Exhibits 2 and 3 and any testimony of Mr. Kearns appearing in the deposition transcript relating to Exhibits 2 and 3 are sustained, but the remaining portions of Mr. Kearns' deposition transcript and Exhibit 1 are admitted. See Order, Nov. 15, 2005. Further, portions of the deposition transcript of Lisa K.
Nummi, R.N., Morton Plant Exhibit 29 were admitted into evidence, i.e., page 42, line 13-page 43, line 8; page 54, line
23-page 56, line 3; page 43, line 9-page 44, line 22; and page
56, lines 4-17.
Bayonet Point called the following witnesses: David R. Williams, accepted as an expert in hospital administration; Richard A. Baehr, accepted as an expert in health planning and health care finance; and Stephen J. Folmer, R.N., an expert in OHS program administration. Bayonet Point (BP) Exhibits numbered 2-12, 13 (Exhibits 1-3, and 7, except results section); and 14-22 were admitted into evidence.
On October 28, 2005, Volumes 1-18 of the final hearing Transcript (T) were filed with the Division of Administrative Hearings. After granting extensions of time in which to file proposed recommended orders and memoranda of law, Helen Ellis, Morton Plant, and Bayonet Point, filed separate proposed recommended orders and Bayonet Point and Morton Plant filed separate closing arguments. All of the post-hearing submissions have been considered in the preparation of this Recommended Order.
FINDINGS OF FACT
The Parties
AHCA. The Agency for Health Care Administration is the state agency authorized to evaluate and render final
determinations on CON applications pursuant to Section 408.034(1), Florida Statutes.1
Helen Ellis. Tarpon Springs Hospital Foundation, Inc., d/b/a Helen Ellis Memorial Hospital is a not-for-profit corporation that operates Helen Ellis Memorial Hospital (Helen Ellis), a 168-bed general acute care hospital located in Tarpon Springs, Pinellas County, Florida.
Helen Ellis is owned by the City of Tarpon Springs and has a 75-year history of providing hospital services to the residents of the Tarpon Springs and surrounding communities. The hospital currently serves the northern Pinellas County and southwestern Pasco County areas, including the communities of Tarpon Springs, Holiday, Palm Harbor, and portions of New Port Richey.
In September 2000, University Community Health, d/b/a University Community Hospital (UCH) acquired a 40-year lease from the City of Tarpon Springs to operate Helen Ellis.2 Pursuant to the agreement, UCH assumed management responsibility for Helen Ellis. UCH paid off approximately $25 million of Helen Ellis' debt and continues to financially support the hospital, notwithstanding financial losses at Helen Ellis over the past several years.
Helen Ellis has a cardiology program with over 20 cardiologists on staff, including interventional cardiologists
who currently perform their interventional procedures at other hospitals. These cardiologists support the development of an OHS program at Helen Ellis, and have indicated they will refer their patients to Helen Ellis for OHS and percutaneous cardiovascular intervention (PCI) services if the hospital's application is approved.
Helen Ellis is accredited by the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) and has a reputation for providing high quality of care.
Helen Ellis provides a full range of diagnostic cardiac catheterization procedures including halter monitoring, stress tests, EKG, diagnostic catheterization, and other procedures used for diagnoses of cardiac disease.
Helen Ellis operates a cardiac rehabilitation program for patients who have OHS or PCI and are in need of follow-up care. Cardiac rehabilitation is an important component of a high quality cardiology service line.
For the first three quarters of 2002, Helen Ellis' utilization of its existing 150-acute care beds (at the time Helen Ellis had 15 skilled nursing beds) was 56.4 percent. Its utilization was 56.3 percent for the entire 2001 year. For 2004, utilization was approximately 54 percent. For 2006 and 2007, Helen Ellis projected 69.4 and 72 percent utilization levels for 168 acute care beds after the OHS project is
completed. Mr. Sullivan opined that the 69 percent figure has not been reached because Helen Ellis has not experienced the "halo effect of the open heart surgery program."
Helen Ellis has a diagnostic cardiac catheterization lab, which is used for cardiac catheterizations and radiological procedures, and is preparing to open a second cardiac catheterization laboratory, which will be used for electrophysiology (EP) studies and cardiac catheterizations.
T 116, 311, 358, 428.
For the calendar year 2004, Helen Ellis reported performing 951 inpatient and outpatient diagnostic cardiac catheterization cases, making it the fifth largest volume provider of such services in the state among the 65 hospitals that do not presently provide OHS. HE 45. The 951 diagnostic cardiac catheterization procedures exceeded the volume of some hospitals that either already provide or are approved to provide OHS. In a more recent CON application, Helen Ellis reported performing 818 inpatient and outpatient cardiac catheterization cases for fiscal year 2004. T 313, 1464; HE 9. If this number is appropriate, then Helen Ellis would rank ninth if the remaining numbers remained unchanged. See Findings of Fact 54-
55 for a more complete discussion of volume.
Recently, the Agency approved Helen Ellis' request to offer emergency PCI under the exemption process established by
the Legislature in 2004 for hospitals that can demonstrate they meet the statutory criteria.3 See Endnote 13.
Although Helen Ellis can provide a range of cardiac services, including cardiac catheterization, it currently lacks the authority to provide OHS, and PCI on a non-emergency basis.
Morton Plant. Morton F. Plant Hospital Association, Inc., is licensed to operate Morton Plant Hospital (Morton Plant), a tertiary acute care hospital. Morton Plant is located in Clearwater, Pinellas County, Florida. Morton Plant is licensed to operate 687 beds, as well as a 120-bed skilled nursing facility on its campus. Morton Plant offers a full range of cardiac care services including OHS and PCI.
Morton Plant is located approximately 13 miles south of Helen Ellis.
Morton Plant is accredited by the JCAHO and has a reputation for providing high quality of care. The parties stipulated that Morton Plant offers high quality of care in its OHS and PCI programs.
Morton Plant Hospital is part of a four-hospital system referred to as Morton Plant Mease Health Care. Morton Plant Mease Health Care is affiliated with BayCare Health System, a network of nine not-for-profit hospitals in Pinellas, Hillsborough, and Pasco Counties.4
Like UCH, Morton Plant is presently building a new dedicated heart hospital on its campus, expected to open in the spring of 2006.
Morton Plant has developed several centers of excellence, and is a regional referral center for OHS and other cardiothoracic services. Morton Plant started its cardiovascular program in 1975 and was the first hospital in the Tampa Bay area to perform angioplasty in 1981.
The active medical staff of Morton Plant currently comprises approximately 850 physicians all of whom are board- certified, pursuant to Morton Plant's medical staff admission requirements.
Morton Plant is implementing a structured continual improvement process which has resulted in continuous improvements in Morton Plant's quality and efficiency of care. Morton Plant has pioneered a number of innovations in OHS and cardiovascular care, including reducing the intubation time of OHS patients, reducing risks to the patient and enabling the patient to progress more rapidly to recovery.
Morton Plant performed between 775 and 812 OHS cases in 2004 (down from between 855 and 938 OHS cases in 2000), making it the sixth largest OHS provider among 64 operational hospitals in Florida. HE 46; MP 9, 11, and 20; BP 15 at 18; T 1909-1910, 1937. See also T 534, approximately 850 OHS cases a year.
PCI's at Morton Plant increased from approximately 2,292 in 1999 to between 2,675 and 2,781 in 2004. MP 8; BP 15 at 19. Morton Plant projects a five percent decrease in PCI procedures for 2006, and has budgeted for declines in OHS volumes in 2006.
Bayonet Point. HCA Health Services of Florida, Inc. (HCA) operates Regional Medical Center Bayonet Point (Bayonet Point), located in Hudson, Pasco County, Florida. Bayonet Point is a regional OHS referral center and is widely known as a high- quality heart hospital. Bayonet Point is a 290-bed licensed tertiary acute care hospital located approximately 18 miles north of Helen Ellis.
HCA also owns Oak Hill Hospital located approximately
16 miles from Bayonet Point in adjacent Hernando County to the north. Oak Hill has received final approval to offer OHS and PCI services.
In addition to Bayonet Point and Oak Hill, HCA also offers OHS and PCI services in the Tampa Bay area at Brandon Regional Medical Center east of Tampa; Northside Hospital in St. Petersburg; and at Largo Medical Center in central Pinellas County. Northside Hospital is approximately 13 miles southeast from Morton Plant. Largo Medical Center is south of and approximately 3 miles from Morton Plant. (The Bayfront/All Children's (Bayfront) program is located southeast of and approximately 7 miles from Northside Hospital.)
The parties stipulated that Bayonet Point offers high quality of care in its OHS and PCI programs. Additionally, the parties stipulated that Largo Medical Center offers high quality of care in its program at the volumes it has operated historically, i.e., below 300 OHS cases per year. Additional decreases in OHS cases at Bayonet Point are expected with the Oak Hill OHS program operational in January 2006.
In 2004, Bayonet Point performed between 741 and 771 OHS cases, making it the seventh largest provider in the state of Florida. OHS case volume decreased from approximately 1,327 in 1999, whereas PCI procedures increased from 2,068 in 1999 to 2,635 in 2004. BP 15 at 18-19.
Current Trends in Treating Acute Myocardial Infarction (AMI)
There are currently three alternatives for patients presenting with severe coronary heart blockage, or acute myocardial infarction (heart attack): medical therapy in the form of thrombolytic drugs; interventional cardiac catheterization, commonly referred to as angioplasty or PCI; and OHS. From approximately the early 1980s through the mid-1990s, OHS was viewed as the preferred long-term treatment for AMI, and notwithstanding other advances mentioned below, OHS (or cornonary artery bypass surgery (CABG)), appears to remain as a
proven technology that has provided and is expected to provide a long-term fix for the problem of coronary artery disease.
PCI has emerged as the preferred treatment for an AMI or coronary artery blockage. A dramatic breakthrough in PCI technology occurred with the advent of stent technology in 1994. A stent is a metallic device placed in an artery through a cardiac catheter and designed to help keep the artery open.
The bare metal stents introduced in 1994, however, had a tendency to result in clotting problems, resulting in recurrence of the arterial blockage in approximately 20 to 30 percent of the cases (restenosis), which often resulted in the removal and replacement of the stent, or in many cases, in an OHS procedure. During the spring of 2003, drug-eluting stents (with a special coating) became available. The preliminary indication is that known restenosis or recurrence rate for drug- eluting stents today is below ten percent.
The emergence of PCI as the preferred treatment for AMI and coronary artery blockage has contributed to the decline in OHS volume, both nationally, statewide, and in District 5. See, e.g., MP 19; BP 15 at 18.5
The District 5 population as a whole has a higher percentage of elderly than the State of Florida. By 2010, it is projected that approximately 27 percent of the total population of the Helen Ellis' designated primary service area (PSA) will
be elderly (older than 65) and approximately 45 percent of the population will be 55 and older.
Today's older OHS patients tend to have more co- morbidities than in the past. These increased co-morbidities, such as stroke history, chronic pulmonary disease, diabetes, etc., increase the risk of OHS and make recovery from OHS more difficult. The greater risk has created an even greater demand for highly skilled OHS surgical teams.
It is reasonable to expect the patients that Helen Ellis would receive for OHS services would have these co- morbidity characteristics.
Patients diagnosed with AMIs should be treated within
90 minutes after the patient enters the emergency room.
Both surgeon and hospital volume are predictors of mortality with respect to OHS services. However, volume should not be used independently as a measure of outcomes or the quality of care of an OHS program. The ability to consistently obtain the best outcomes for patients depends, in part, upon the level of experience and expertise of the surgeons, anesthesiologists, perfusionists, respiratory therapists, and surgical and critical care nurses. Geographic access issues are also a consideration. Generally, hospitals with higher OHS volumes provide an environment conducive for gaining the necessary experience with both routine and non-routine cases.
Some studies reflect that high-volume OHS programs achieve good outcomes and lower mortality for patients, compared to lower-volume OHS programs. One study, HE 16, indicated that "hospital procedure volumes only is modestly associated with coronary bypass outcomes and, therefore, may not be an adequate metric for coronary artery bypass surgery." T 607, 667.
On the other hand, studies also indicate that some low- volume programs can achieve good outcomes, although there is greater variability with respect to outcomes among low-volume programs than occurs in high-volume programs. The better results with respect to OHS mortality appear to have been obtained by high-volume surgeons (and OHS team members) at high- volume hospitals, and overall, at least with respect to CABG, high hospital procedure volume has been associated with lower rates of hospital mortality, especially in elderly patients, 65 and older.
Review of clinical data suggests that while there are some statistically significant correlations between volume and outcomes, particularly in elderly patients, volume is not alone a good predictor of quality. There are low-volume programs which achieve excellent outcomes, while there are high-volume centers with poor outcomes. The level of the quality of care delivered in an OHS program depends on a host of factors independent of volume. See, e.g., T 615 and HE 17, describing
21 measures used to assess quality of cardiac vascular surgical delivery.
Taken as a whole, the credible evidence does not support the assertion that an OHS program operating at volumes of approximately 150-200 cases annually in the start-up years would necessarily result in a low quality program, although the evidence indicates that such a program would be a lower-volume program.
Section 408.035(1), Florida Statutes - Need for the service being proposed/fixed need pool.
Florida Administrative Code Rule 59C-1.033(7), includes a numeric need formula for determining the need for new OHS programs. There is no specific need formula for PCI services, although currently, approval for OHS is required before a hospital can implement PCI services except as stated herein.
Under its numeric need formula, the Agency published a fixed need pool of zero for District 5 (Pinellas and Pasco Counties) in the CON batching cycle at issue in this case.
Largo Medical Center performed less than 300 OHS cases per year and East Pasco Medical Center, located in eastern portion Pasco County, Florida, is approved but was not yet operational at the time the fixed need pool was published.
In light of the zero fixed need pool, Helen Ellis is required to prove that "not normal" circumstances exist within
District 5 in order to obtain approval of its proposed OHS program. "Not normal" circumstances generally consist of serious impediments or barriers to access to existing services, including geographic, financial, or programmatic access barriers.
The parties stipulated that approval of an OHS program in Helen Ellis will have no impact on the lower-volume program at Largo Medical Center. It was further stipulated that Largo Medical Center is able to provide high quality of care at its current historic OHS case volumes.
It was also established that the proposed new OHS program at Helen Ellis would have no impact on the approved program at East Pasco Medical Center, which is located on the eastern side of Pasco County. (East Pasco Medical Center supports the approval of the Helen Ellis application.)
There are five existing providers of OHS services in District 5: Bayonet Point, Morton Plant, Largo, Bayfront/All Children's, and Northside. Of the five District 5 OHS providers, only Morton Plant and Bayonet Point significantly compete with Helen Ellis.
Helen Ellis' PSA consists of eight zip codes: 34652 and 34655 (New Port Richey); 34682-34684 (Palm Harbor)(zip code 34682 is a Post Office box zip code associated with the parent
zip code of 34683); 34688-34689 (Tarpon Springs); and 34690-
34691 (Holiday).
Helen Ellis is located in zip code 34689 (Tarpon Springs), and no OHS hospital provider is physically located in this PSA, although other District 5-area hospitals serve the residents of this PSA.
In its CON application, Helen Ellis defined its PSA as the area where Helen Ellis derived over 80 percent of its adult cardiovascular discharges for year ending June 2002. HE 1 at 18-19; T 1392.
The estimated adult population (ages 15 and older) in the PSA is growing approximately 2,600 to 2,900 persons per year since 2002: 147,667 in 2002; 151,408 in 2003; 154,044-154,372 in 2004; 156,726 in 2005; 159,455 in 2006; 162,231 in 2007; 165,055 in 2008; 167,928-168,115 in 2009; 170,733-170,852 in 2010; and 173,351 in 2011. HE 1 at 26; HE 63; BP 15 at 48; MP 21; T 2204, 2212-2213, 2222-2223.
The number of OHS cases for residents within the PSA decreased from approximately 445 for the calendar year ending December 31, 1999, to approximately 367 to 368 for the calendar year ending September 2004. The 367 to 368 or so cases performed in the PSA in 2003-2004 was less than the 387 OHS cases performed within the PSA in July 2001 to June 2002, which served as a benchmark for Helen Ellis' projections in the CON
application. MP 21; BP 15 at 37, 46; HE 1 at 25-26; T 2204-
2205, 2214-2215, 2389.6
The number of adult inpatient cardiac catheterization cases (based on discharges within the PSA) performed at Helen Ellis declined from 306 from July 2001 to June 2002 to 220 cases for calendar year 2004, an approximate 28 percent decline.
T 2443-2444; HE 62; Helen Ellis 1 at 25. But see HE 9 showing a total (not exclusively within the PSA) of 375 inpatient and 443 outpatient cardiac catheterization procedures (total 818) performed at Helen Ellis for the fiscal year ending September 2004. T 1464-1465, 1549-1550.
Based upon data for calendar year 2004, approximately eighty percent (177/220) of the inpatient diagnostic cardiac catheterization discharges from Helen Ellis were performed on residents from zip codes 34683 (24) (adjacent and south of zip code 34689), 34689 (107), and 34691 (46) (adjacent and north of zip code 34689). See Endnote 8. Zip code 34684 (12) is east and adjacent to zip code 34683 and zip code 34690 (13) is east and adjacent to zip code 34691. Thus, 202 out of 220 inpatient cardiac catheterization discharges were performed at Helen Ellis on residents from five zip codes, four of which are adjacent to zip code 34689, the site of Helen Ellis.
The experts differ on Helen Ellis' projected market share for these zip codes and outside these zip codes (out-of-
area). There is no exact science applied to develop a market share.
In its CON application, Helen Ellis provided projections for calendar years 2006-2008, the projected first, second, and third years of operation. For calendar year 2006, Helen Ellis used a market share of 27 percent,7 and an "out-of area" rate of 19.4 percent (the same number used by Mr. Baehr; Mr. Richardson used 13.8 percent). Helen Ellis then applied the
27 percent market share (114 OHSs) and a 19.4 "out-of-area" share (27 OHSs) and projected that it would perform 141 OHS cases during the first year of operation; 208 OHS cases (at 39 a percent market share) and 235 OHS cases (at a 43 percent market share) for the second and third years of operation, respectively. HE 1 at 41-43. (In the CON application, Helen Ellis assumed that the use OHS rate of 2.62 (for July 2001-June 2002) would remain constant for three years. Id. See Endnote 6.) Helen Ellis projected that 421 adult OHSs will be performed on residents of the PSA in calendar year 2006; 430 in 2007; and 440 in 2008.
In its CON application, based upon the observations of cardiologists on staff at Helen Ellis, Helen Ellis estimated that between 20 and 25 percent of the area cardiologists' patients needing cardiac catheterizations bypass Helen Ellis. See HE 1 at 35; T 1401, 1480, 1535. However, Mr. Nelson did not
use a "bump-up" factor in the CON application to increase the market share. Rather, the reported market share in the CON application is 27 percent for calendar year 2006, without a "bump-up. HE 1 at 41; T 1405, 1538, 2408-2409, 2417.
HE 62.
During rebuttal, Helen Ellis offered Helen Ellis Exhibit 63, which is a revised OHS utilization forecast for the years 2009-2011, i.e., revised projected initial years of operation. Helen Ellis projected performing 139, 206, and 233 OHS cases for the first three years of operation, 2009-2011, by using the same approximate market share numbers (27.3, 39.6, and 43.8) and the same "out-of-area" percentage of 19.4 percent. If the market share is reduced to 25, 35, and 40 percent for years 2009-2011, respectively, Helen Ellis projects 128, 182, and 213 OHS cases for each year. If the market share is increased to 35, 45, and 50 percent for years 2009-2011, respectively, Helen Ellis expects to perform 179, 235, and 266, OHS cases for each year. (For 2009-2011, Helen Ellis assumed there would be 409, 417, and 425 adult OHS cases within the PSA.) Mr. Nelson agreed that the use rate is less now than at the time the application was submitted. T 2401; HE 63.8
Mr. Richardson criticized Mr. Nelson's approach (in the CON application) in three ways: 1) the OHS use rate is lower today than when the CON application was filed in January 2003;
2) Helen Ellis's projected market share was "very aggressive"; and 3) Helen Ellis' projected numbers of OHS cases from out of the PSA was "overly optimistic."
Generally, Mr. Baehr felt that Helen Ellis' market share for inpatient cardiac catheterizations within the PSA was
13.8 percent rather than 27 percent used in the CON application.
He agreed, however, that Helen Ellis could garner a 19.4 percent out-of-area share. Based on several factors, Mr. Baehr projected lower OHS volumes for the Helen Ellis program than projected by Helen Ellis for the first three years of operation.
The health care planning experts agree on some points and disagree on others. The material issues of dispute center on what is a reasonable forecast for Helen Ellis' market share (including any bump-up and out-of-area volume) for adult OHS cases for the revised first and second years of operation (2009 and 2010) and what is the pool of potential OHS cases from within and outside the PSA.9
Based on the conflicts in the evidence, it is concluded that a range for Helen Ellis' projected market share is between approximately 21 and 27.3 percent (including a bump-up or by- pass number) for the first year of operation (2009) and approximately 35 percent for year two (2010), which includes a reasonable "ramp up." These assumptions yield between
approximately 115 and 139 OHS cases projected to be performed at Helen Ellis for 2009 and approximately 182 OHS cases for 2010.
These projections may be higher or lower depending, in part, on physician referral patterns and market share adjustments. See, e.g., T 895-917 for Dr. Javeed's testimony. Nevertheless, Helen Ellis will be a lower-volume provider of OHS services for at least its first three years of operation.
Section 408.035(2) and (5), Florida Statutes: Availability, Quality of Care, Accessibility, and Extent of Utilization of Existing Health Care Facilities and Health Services in District 5 and the Extent the Proposed Services will Enhance Access to Health Care for Residents of District 5
As noted, there are five (5) existing providers of OHS services in District 5, but only two (Morton Plant and Bayonet Point) have significant service area overlap.10 Adult OHS programs are located within a two-hour travel time under average travel conditions for at least 90 percent of the District 5 population as required by Florida Administrative Code Rule 59C- 1.033(4)(a) and are otherwise geographically and economically accessible to the residents of District 5. However, compliance with this standard does not preclude approval of new OHS program.
No travel time study was conducted in this case. There is testimony that the roadways north and south of Helen Ellis (US 19 and alternate US 19) are congested especially during peak season, but not to the extent that patients residing within the
PSA cannot reasonably access the OHS programs at Morton Plant and Bayonet Point. These residents can also reasonably access the OHS program at UCH/Pepin in Hillsborough County.
Bayonet Point is approximately 18 miles to the north of Helen Ellis. The service area for Bayonet Point and the PSA for Helen Ellis for zip codes 34652, 34691, 34690, 34655, and 34689 (the location of Helen Ellis) overlap for OHS services; the service areas for OHS do not overlap for zip codes 34683, 34684, and 34688 (within Helen Ellis' PSA). The service areas for Bayonet Point and Helen Ellis for diagnostic cardiac catheterization overlap significantly.
Morton Plant is approximately 13 miles to the south of Helen Ellis. All of the eight zip codes identified within Helen Ellis' PSA overlap with Morton Plant's service area for OHS and their service areas also overlap for diagnostic cardiac catheterization.
Many of the residents within the PSA are within seven- to-ten miles of either Bayonet Point or Morton Plant.
Approximately 80 percent of the inpatient cardiac catheterization discharges performed at Helen Ellis for calendar year ending 2004 came from its home zip code 34689 (107/220), zip code 34691 (46/220) to the immediate north, and 34683 (24/220) to the immediate south. Approximately 49 percent of these discharges came from zip code 34689.
Bayonet Point offers all major health care services, except obstetrics, psychiatric, and pediatric services. The hospital serves the residents of Northern Pinellas County, Hernando County, and Pasco County.
Bayonet Point has received awards for providing excellent health care services, including cardiology and open heart. Bayonet Point participates in community services.
Bayonet Point recently completed a $40 million expansion and renovation project for its cardiac surgery program
-- The Heart Institute. The project included the expansion and renovation of four cardiovascular operating rooms (CVOR) and accompanying areas surrounding the CVOR's, the 20-bed CSU, the pre-operative and post-operative areas, the CSU, the step-down unit, and the cardiac catheterization recovery area.
Bayonet Point is an accredited chest pain center, able to provide services in its emergency department (with 18-beds) to cardiac patients who present with chest pain and ST Elevation Myocardial Infarctions (STEMI). The emergency department participates in improvement programs to monitor and improve the quality of care provided to cardiac patients. Bayonet Point has reduced the turn-around times for cardiac enzyme results, and getting patients to the cardiac catheterization labs and has increased compliance with standard of care protocols in the treatment of cardiac patients.
Bayonet Point offers a full range of cardiac services, except for heart transplantation, pediatric cardiology, and phase 2 and 3 cardiac rehabilitation services. The latter cardiac rehabilitation services are offered on Bayonet Point's campus at a physician's office.
Bayonet point has four cardiac catheterization labs, three of which are dedicated solely to cardiac procedures and one that is dedicated to peripheral vascular procedures and/or cardiac procedures. It also has two dedicated EP labs. The routine business hours for the labs are from 7:30 a.m. until 7:30 p.m. during the week, but the catheterization labs are available 24 hours day, 7 days a week, 365 days a year for emergent or urgent cases. The on-call catheterization lab team routinely responds within 30 minutes and responds in a timely fashion to a patient being transferred from other hospitals.
Bayonet Point currently has seven cardiovascular surgeons on staff to perform OHS procedures and other cardiac surgeries. Usually two surgeons are on call. Three operating rooms (a fourth is being added with a shelled-in room for future use) are available exclusively for cardiovascular surgeries. All medical staff members are required to be board-certified. Physicians must be board-eligible to join the staff, but must become board-certified within six years to remain on staff.
The parties stipulated that Bayonet Point has a reputation for providing high quality of care in its existing OHS and PCI programs.
The new heart hospital will have a "PACS" program as well as other enhancements.
Morton Plant currently operates three state-of-the-art cardiac catheterization labs which are used exclusively for cardiac catheterization procedures, and also operates an EP lab which is used exclusively for EP procedures. When construction is completed, Morton Plant will have four cardiac catheterization labs, two EP labs, and one shelled-in space for expansion.
The Morton Plant cardiac catheterization labs routinely operate from 7:30 or 8:00 a.m. to 6:00 p.m., depending on the season. During peak season, one or two labs may remain open until 7:00 p.m., or later if necessary. One lab is open routinely on Saturdays. All of the cardiac catheterization labs are available 24-hours a day, seven days a week for emergent cases. Emergent cases are given a priority in these labs, regardless of whether the patient is referred from an affiliated hospital or non-affiliated hospital. Morton Plant has a policy of admitting emergent patients directly into the cardiac catheterization lab.
Patients transferred to Morton Plant or Bayonet Point have received high quality care in a timely fashion with no adverse outcome arising from the transfer.
Morton has provided enhancements to the emergency service system in District 5.
Because OHS is a tertiary health service,11 it is expected that some patients will be transferred from community- type hospitals to regional OHS referral centers for open heart surgery. The great majority of patients receive OHS on an elective, rather than on an urgent or emergency basis. It is a fair inference that most patients requiring OHS are not transferred from another hospital, but travel to the OHS provider from elsewhere, including home. See, e.g., T 1661, regarding Dr. Cambier's experience at Morton Plant.
Helen Ellis contended that there are inordinate delays in transferring patients needing cardiac services from Helen Ellis to area OHS providers. The evidence does not support this claim. In making this finding, consideration was given to the evidence offered by Helen Ellis, including but not limited to Helen Ellis Exhibit 37 and testimony regarding this exhibit.12
Several Helen Ellis cardiologists expressed concern regarding the difficulty transferring patients from Helen Ellis in need of urgent PCI or OHS services. Delay is attributable to lack of bed availability and the lack of cardiac catheterization
lab availability at existing providers, as well as the lack of critical care ambulances available to transport these patients. They also express concern that even in non-urgent cases, not allowing Helen Ellis to perform PCI services is detrimental to their patients because patients have to undergo duplicate procedures if the diagnostic catheterization reveals that the patient needs an interventional procedure (PCI).13
Several physicians testified on behalf of Helen Ellis that due to the travel distances between Helen Ellis and Morton Plant or Bayonet Point, they cannot round on their patients and that transferred patients lose continuity of care.
Having primary care physicians involved with patient care is beneficial to the patients and OHS surgeons.
According to the AHCA database, Helen Ellis transferred
85 adult cases with the primary diagnosis of ischemic heart disease to another facility in 2004. The number of transfers increased to 112 for those patients with the broader MDC-5 diagnosis of "diseases of the heart" in 2004. In 2004, approximately one percent of the patients visiting the emergency room at Helen Ellis were transferred out of the hospital.14
Patients are routinely transferred to Bayonet Point and Morton Plant for OHS and PCI services and have consistently received high quality of care in a timely fashion. There are no unreasonable delays in receiving or accepting a patient and
beginning necessary treatment of the patient upon arrival at these facilities. Emergency patients needing OHS or PCI services are treated immediately and appropriately. Non- emergency patients needing OHS and PCI services are scheduled in a timely fashion.
Although located in adjacent Hillsborough County, UCH's Pepin Heart Institute serves as a regional referral center for OHS services for Pasco and Pinellas counties. Patients can be transferred from Helen Ellis to UCH for cardiac services by ground transportation within approximately 60 minutes.
Helen Ellis did not offer persuasive evidence that patients experienced adverse outcomes as a result of being transferred to another facility for OHS or PCI services. Nor did Helen Ellis demonstrate any inordinate delays in transferring patients to other facilities for PCI and/or OHS services.15
Notwithstanding the above, approval of an OHS program at Helen Ellis may improve access for a limited number of prospective patients largely residing in zip code 34689 (the location of Helen Ellis), and perhaps zip code 34683 to the south and zip code 34691 to the north.
Section 408.035(3), Florida Statutes: History and Ability of Helen Ellis to Provide Quality of Care
Helen Ellis is accredited by the JCAHO.
Helen Ellis has received awards indicating it provides high quality of care in general and performs high quality cardiac services. Its emergency department services are also high quality, notwithstanding some limitations. The hospital's Quality Assurance and Performance Improvement Plans were included in the CON application and have been updated annually.
Helen Ellis' proposal to provide PCI to emergency heart attack patients has been approved by AHCA as meeting all required guidelines of the American College of Cardiology and staffing and equipment criteria to achieve good quality of care for these patients.
UCH/Pepin Heart Institute provides high quality of care. Like Morton Plan and Bayonet, it is a regional referral hospital for patients needing OHS, PCI, and other cardiac- related services.
UCH has committed to oversee implementation of Helen Ellis' OHS program. Its relationship with Helen Ellis is a positive one from a quality of care standpoint.
Helen Ellis will share in and utilize the same experienced open heart surgeons that are currently providing OHS services at the UCH/Pepin Heart Institute. This five-member
surgical group, under the medical direction of Dr. Marc Bloom, comprises experienced cardiovascular surgeons also on the medical staff at Helen Ellis, where they maintain an office for consultations, and are currently providing vascular and thoracic surgery at the hospital. This surgical group intends to have an exclusive contract with Helen Ellis to provide OHS services at Helen Ellis and currently has an exclusive contract with UCH to provide all OHS surgical services at UCH and, in the future, at East Pasco Medical Center, approximately 20 minutes' travel time from UCH.
Dr. Bloom and his surgical group plan on providing OHS coverage full time, 24 hours per day, 7 days a week, at Helen Ellis. The plan is for the five member team to take turns rotating through Helen Ellis, because the surgical group's home base is 45 minutes away. Dr. Bloom expects that the group member providing coverage for a particular week will actually have to "live there" when it is their week. T 704, 725-726. Dr. Bloom expects to spend a lot of time at Helen Ellis when the program starts at Helen Ellis.
Dr. Bloom performs approximately 90 to 120 OHSs a year. T 695, 726. Last year, his group performed approximately
550 OHSs at UCH, although the number is not spread evenly among the group.
While it is not uncommon to have surgeons providing OHS surgical coverage at more than one hospital, the proposed arrangement is less than optimal. (Dr. Cambier opined that it may be arduous for two certified interventional cardiologists to anchor an interventional program at Helen Ellis. Having two cardiac catheterization labs with shared roles raised additional concerns for him. T 1609-1613.) Moreover, there is a benefit to having two or more OHS surgeons present at a hospital each day. If one surgeon is involved in a long or complex operation, and there are other problems with that surgeon's patients on the floor or in the intensive care unit, the other surgeon can offer coverage without disrupting continuity of care.
Delivery of high quality OHS services requires experience and skill on the part of the entire OHS team, including the surgeon, perfusionists, cardiac anesthesiologists, recovery nurses, and ancillary hospital services. Ongoing repetition is important. Helen Ellis plans to use the same perfusionists, anesthesiologists, and other medical support staff that are used at the UCH/Pepin program as well as the same policies, practices, and protocols. The operating room, critical care and cardiac catheterization nurses are expected to receive training at the UCH/Pepin program, depending on their levels of experience. Helen Ellis expects to use technological linkages, such as a "PACS" system, with UCH.16
The parties stipulated that Helen Ellis' proposed staffing projections, staffing ratios, and staffing salaries are reasonable and appropriate.
Despite a perceived shortage of nurses, it appears that Helen Ellis will be able to attract enough nurses to adequately staff its OHS program in light of its relationship with the UCH/Pepin program. The same can be said for the other personnel necessary to adequately staff an OHS program. While not optimal, it appears that the medical surgical group will be able to provide quality OHS services at Helen Ellis if Helen Ellis can maintain adequate OHS case volumes.
Section 408.035(4), Florida Statutes: Availability of Resources, Including Health Personnel, Management Personnel, and Funds for Capital and Operating Expenditures for Project Accomplishment and Operation
As noted, Helen Ellis' proposed staffing projections, staffing ratios, and staffing salaries are reasonably appropriate. The weight of the evidence indicates that Helen Ellis will be likely to attract personnel to adequately staff the OHS program. Whether the medical surgical group can adequately staff the OHS program 24 hours per day, 7 days a week, given their existing commitments is discussed above.
UCH has committed the funds necessary to accomplish the proposed project at an estimated total cost of $7,305,074,
as well as for all other capital projects listed on Schedule 2 of the CON application. T 119-120.
Helen Ellis has management personnel available to operate the OHS program.
Section 408.035(6), Florida Statutes: Immediate and Long- Term Financial Feasibility
The parties stipulated that Helen Ellis can obtain sufficient funds to fund the start-up costs shown in Helen Ellis' CON application. The parties also stipulated that Helen Ellis' proposed costs and methods of construction are appropriate and reasonable.
Long-term financial feasibility refers to the ability to break even or have positive income within two years according to the pro forma financial schedules (Schedules 7A and 8A) contained in the CON application.
Helen Ellis' pro formas indicate that the proposed OHS program will have a positive net income in year 2 of operation. (The project, if approved, will not be operational in the year projected in the CON application.) The pro formas contain a mathematical computation error based on Medicare reimbursement weights for a specific DRG code classification. Mr. Sullivan corrected this error and indicated that the project is expected to have a positive net income of $2,640,000 for year
2 of operation. (Of this amount, approximately $200,000 is
attributable to OHS cases. Thus, the pro formas rely heavily on revenue generated from PCI cases. Significant reductions in the number of PCI's performed could adversely affect the bottom line profit for year 2.)
The pro formas did not consider the expense related to the use of drug eluting stents rather than bare metal stents. The cost of a drug eluting stent is approximately $2,000.00 more than a bare metal stent. The additional cost, however, is not expected to significantly impact the net profit for year 2.
The pro formas were also criticized because Helen Ellis did not use a sister hospital with an OHS program as a proxy for non-labor cost and expense experience, instead relying on the actual historical costs experienced at Helen Ellis without an OHS program. To the extent there might be higher costs for other general departments such as the pharmacy, etc., this appears to have been accounted for by the longer lengths of stay for OHS patients.
Notwithstanding the financial condition (losses over the past several years, i.e., $9 million loss in 2001 decreasing to a loss of $4 million in 2004) of Helen Ellis, see also Finding of Fact 4, the long-term financial feasibility of this project is largely determined by whether Helen Ellis can achieve the projected number of OHS and PCI cases for year 2. Generally OHS programs and associated PCI programs tend to be financially
feasible. Mr. Knapp, Morton Plant's expert in health care accounting and finance, did not opine that Helen Ellis' project is not financially feasible, only that its pro formas suggested to the contrary. T 1822-1823. He opined that the charges proposed by Helen Ellis are within the normal expected range.
Overall, notwithstanding the historical financial condition of Helen Ellis, if Helen Ellis attains the projected numbers of OHS/PCI cases, the project is expected to be financially feasible in the long term. Even with the OHS case volumes identified in Finding of Fact 62, given the potential variability in potential volume in light of physician testimony, the project is likely to be financially feasible in the long term.
Section 408.035(7), Florida Statutes: Extent to which the Proposal will Foster Competition that Promotes Quality and Cost-Effectiveness
There is competition among the existing OHS providers in District 5. Existing providers have overlapping service areas and compete for cardiac patients and staff. Residents within District 5 and, in particular the PSA, enjoy reasonable access to existing OHS providers within District 5.
Morton Plant is the lowest-charge provider of OHS and PCI services in District 5. Helen Ellis would charge more than Morton Plant for angioplasty and OHS services. Helen Ellis was a higher charge provider than Bayonet Point in one DRG category,
lower in two DRG categories, and the fourth DRG category was a tie. T 1335.
Morton Plant will suffer a material adverse financial impact if the Helen Ellis OHS project is approved, but the loss of OHS and PCI procedures is not expected to adversely impact the quality of care offered at the program, and Morton Plant would continue to be in a strong financial position. It is expected that Bayonet Point would lose a large number of OHS cases per year and be financially impacted, but approval of the program is not expected to reduce the quality of Bayonet Point's OHS/PCI program.
The approval of this project may increase competition and access and afford patients another alternative to some degree. It was not proven that approval would necessarily promote quality and cost-effectiveness as Morton Plant and Bayonet Point offer high quality OHS and PCI programs and continue to upgrade their respective programs at will.
Section 408.035(8), Florida Statutes: Costs and Methods of Proposed Construction
The parties stipulated that the proposed costs and methods of construction for the project are appropriate and reasonable.
Section 408.035(9), Florida Statutes: Applicant's Past and Proposed Provision of Health Care Services to Medicaid Patients and the Medically Indigent
Helen Ellis provides community services to all levels of patients regardless of payment. Helen Ellis did not offer to allocate, as a condition for the approval of a CON, any specific percentage of Medicaid or indigent care.
Helen Ellis does not operate any indigent care clinics, but does have outreach areas where they have family practice physicians and others available for the public.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties to and subject matter of this proceeding pursuant to Sections 120.569, 120.57(1), and 408.039(5), Florida Statutes.
Morton Plant and Bayonet Point have standing to participate as parties in this proceeding pursuant to Section 408.039(5), Florida Statutes.
As the applicant, Helen Ellis has the burden of proving, by the preponderance of the evidence, entitlement to a CON. Boca Raton Artificial Kidney Center, Inc. v. Department of Health & Rehabilitative Services, 475 So. 2d 260 (Fla. 1st DCA 1985); § 120.57(1)(j), Fla. Stat.
The award of a CON must be based on a balanced consideration of all applicable and statutory rule criteria.
Balsam v. Department of Health & Rehabilitative Services, 486 So. 2d 1341 (Fla. 1st DCA 1986). "[T]he appropriate weight to be given to each individual criterion is not fixed, but rather must vary on a case-by-case basis, depending upon the facts of each case." Collier Medical Center, Inc. v. Department of Health & Rehabilitative Services, 462 So. 2d 83, 84 (Fla. 1st DCA 1985).
The CON review criteria set forth in Section 408.035(1)-(9), Florida Statutes, and Florida Administrative Code Rule 59C-1.033 are applicable to Helen Ellis's proposed OHS program. The parties stipulated that Helen Ellis met AHCA's rules regarding minimum content and timely submission requirements.
Pursuant its rule methodology, the Agency determined that there is no fixed need pool for an additional OHS program in District 5 for the applicable planning horizon.17 Accordingly, Helen Ellis was required to demonstrate "not normal" circumstances in order to obtain approval of its CON application. See generally Humana, Inc. v. Department of Health & Rehabilitative Services, 469 So. 2d 889 (Fla. 1st DCA 1985).
There is no specific statutory or rule definition of what constitutes "not normal" circumstances. However, it has been said that "[t]he applicant must demonstrate and there must be some finding of fact that, without the requested lab [here
OHS services], the existing facilities are (or will be) unavailable or inaccessible, or the quality of care is (or will be) suffering from over utilization, or other evidence of that nature." Humana, Inc. v. Department of Health & Rehabilitative Services, 492 So. 2d 388, 392 (Fla. 4th DCA 1986)(citations omitted). By their nature, "not normal circumstances cannot be classified as typical. To the contrary, "not normal" circumstances must be a departure from the normal state of affairs. See Florida Health Sciences Center, Inc. vs. Agency for Health Care Administration, DOAH Case Nos. 00-0481, 00-0482, 00-0484, and 00-0485 (DOAH March 30,2001; AHCA Aug. 6, 2001, at
3-4), per curiam affirmed, 827 So. 2d 984 (Fla. 1st DCA 2002).
The Agency has previously approved new OHS programs in the absence of a fixed need pool. These cases, including but not limited to the Agency's approval of an OHS program at Brandon Regional Hospital, see Florida Health Sciences Center, Inc., supra, and at Oak Hill Hospital, see HCA Health Services of Florida, Inc. vs. Agency for Health Care Administration, DOAH Case Nos. 00-3216-00-3218, and 00-3220-00-3221 (DOAH Oct. 4, 2001; AHCA Jan. 24, 2002), are not applicable here. The Agency's approval of these OHS programs appears to be the exception to the Agency's generally stated principle that OHS programs should be concentrated in a limited number of hospitals
to ensure, quality, availability and cost-efficiency in the delivery of the service.
There are five providers of OHS services in District
5 and one approved program. Four operational OHS programs, including Morton Plant, are located in the southern portion of Pinellas County, with Bayonet Point located in western portion of Pasco County and East Pasco Medical Center, the approved program, in the eastern portion of Pasco County.
Helen Ellis did not prove that the residents from the eight zip codes in its PSA, including the three zip codes from which Helen Ellis receives approximately 80 percent of its inpatient cardiac catheterization volume, i.e., 34689, 34683, and 34691, do not have reasonable access to existing OHS programs in District 5, including but not limited to Morton Plant and Bayonet Point.
Existing OHS programs in District 5 are available, accessible, appropriately utilized, and at least as to Morton Plant, Bayonet Point, and Largo, provide high quality of care in their existing OHS and PCI programs.
Helen Ellis has a record of providing quality of care and has the ability to provide quality of care in an OHS program if an adequate number of OHS cases are performed for the projected years of operation, 2009-2010. As updated, Helen Ellis projects that it will perform between a 139 and 179 OHS
cases for 2009, between 206 and 235 cases for 2010, and between
233 and 266 OHS cases for 2011. These numbers are likely overly optimistic. While there may be variability, it is determined that Helen Ellis may perform between approximately 115 and 139 OHS cases in 2009 and approximately 182 OHS cases in 2010. (There is no persuasive evidence that Helen Ellis will perform more than 300 OHS procedures by 2011.)
The persuasive evidence indicates that the Helen Ellis projected number of OHS cases would make Helen Ellis a lower volume provider of OHS services. See, e.g., HE 46. The recent trends indicate that the number of OHS cases performed in Florida and nationally will continue to decline although the precise amount is uncertain.
The persuasive evidence indicates that there is a relationship between volume and mortality rates, i.e., the higher the volume, the lower the mortality rates. However, there are other factors that should be considered including but not limited to the proficiency of the OHS team. Helen Ellis proposes to essentiality rotate among five cardiovascular surgeons, who vary in degrees of proficiency, a week at a time with Dr. Bloom, a high quality cardiovascular surgeon, essentiality heading up the delivery of OHS surgical services. However, persuasive evidence indicates that given the projected volume at Helen Ellis during the initial three years of
operation, the proposed delivery of OHS services is not optimal, notwithstanding the fact that it can not be said that Helen Ellis would not provide quality of care for OHS patients. It is a question of degree.
Helen Ellis demonstrated that it has the available resources, including health personnel, management personnel, and funds for capital and operating expenditures to accomplish the OHS project and operation.
Approval of an OHS program at Helen Ellis may enhance access to some extent to OHS services for a limited number of residents within Helen Ellis' PSA. The enhanced access is on a localized basis and not a regional one, and is necessarily limited.
The parties stipulated that operation of the OHS program at Helen Ellis is financially feasible in the short-term or immediate. The long-term financially feasibility of the OHS program is dependant on Helen Ellis obtaining the projected number of OHS cases. This is a closer call given the range of potential OHS cases which may be projected to be performed at Helen Ellis during the second year of operation in 2010, but appears achievable.
Approval of the OHS program at Helen Ellis may foster limited competition among the existing providers of OHS services in District 5 but will not necessarily promote quality and cost-
effectiveness as the main competitors of Helen Ellis, Morton Plant and Bayonet Point, provide high quality OHS and PCI services and perform such in a cost-effective manner.
The parties stipulated that the cost and methods of the proposed construction are reasonable.
Helen Ellis has a history of providing health care services to Medicaid patients and the medically indigent. Helen Ellis declined to accept any conditions regarding this issue.
It was not proven that Helen Ellis will enhance provision of OHS services to Medicaid patients and the medically indigent. On the other hand, it appears that Medicaid patients and the medically indigent in District 5 have reasonable access to area providers.
Helen Ellis did not prove that there are "not normal" circumstances existing in District 5 to justify approval of its CON application. On balance, Helen Ellis' CON application number 9629 should be denied.
Based on the foregoing Findings of Fact and Conclusions of Law, it is
RECOMMENDED that the Agency for Health Care Administration enter a final order denying Helen Ellis' CON application number 9629.
DONE AND ENTERED this 21st day of March, 2006, in Tallahassee, Leon County, Florida.
S
CHARLES A. STAMPELOS
Administrative Law Judge
Division of Administrative Hearings The DeSoto Building
1230 Apalachee Parkway
Tallahassee, Florida 32399-3060
(850) 488-9675 SUNCOM 278-9675
Fax Filing (850) 921-6847 www.doah.state.fl.us
Filed with the Clerk of the Division of Administrative Hearings this 21st day of March, 2006.
ENDNOTES
1/ All citations are to the 2005 version of the Florida Statutes unless otherwise indicated.
2/ UCH operates four hospitals in the greater Tampa Bay area including University Community Hospital on Fletcher Avenue in Tampa, Carrollwood Community Hospital in the northern Hillsborough community of Carrollwood, Suncoast Hospital in Largo in central Pinellas County and Helen Ellis in Tarpon Springs in northern Pinellas County. UCH's main campus on Fletcher Avenue in Tampa is a 431-bed tertiary hospital that has medical school teaching affiliations with the University of South Florida. UCH's main campus is known for its centers of excellence. UCH's main campus also includes the Pepin Heart Hospital & Research Institute (Pepin Heart). Pepin Heart is a mature OHS interventional cardiology program that offers a full range of open heart and interventional cardiology services. A new free-standing 274-bed Pepin Heart is currently under construction on the UCH main campus.
3/ Therapeutic cardiac catheterization procedures, also called percutaneous coronary intervention or PCI, are designed to clear blockages in the arteries leading to the heart, while EP
procedures address the rhythm or electrical impulses in the heart.
4/ The BayCare System includes Morton Plant, Mease-Dunedin, Mease Countryside, and St. Anthony's in Pinellas County; St. Joseph's Hospital in Hillsborough; and North Bay Hospital in Pasco County. St. Anthony's in south Pinellas County and Mease Countryside in north Pinellas County submitted CON applications to provide OHS programs in the same batching cycle as the Helen Ellis CON application.
5/ Northside has experienced increases in OHS cases, whereas the Bayfront/All Children's OHS program has declined. Largo's OHS case volume has remained somewhat constant, with some increase between 2003 and 2004, i.e., approximately 215 to 258, but remaining below 300 OHS cases per year. (Most of the numbers (cardiac catheterizations, OHSs, and PCIs) discussed in this record vary, but similar decreases or increases are recognized regardless of the data set used.) Part of the perceived decline in the volumes of OHS cases, aside from as noted herein, is due to a change in the Diagnostic Related Group (DRG) codes that were and are now included in the definition of OHS. Prior to 2002, defibrillator implant cases, as well as other procedures, were included with the DRG definition of OHS. In subsequent years, these cases were excluded from the definition.
See, e.g., T 1856-1860. When the data is adjusted, the decline in OHS volume is less dramatic. There is some inconclusive testimony that OHS volume may level off or tip up slightly in future years.
6/ OHS case volumes and use rates in District 5 and statewide have declined between 1999 and 2004. MP 19; BP 15 at 18.
Likewise the OHS use rate for the PSA has declined approximately ten percent during the last two and a half years. T 2192-2193, 2205.
7/ Helen Ellis assumed its 27.3 percent inpatient cardiac catheterization market share from the PSA would mirror its projected OHS market share "at least initially." T 1400, 1415; HE 1 at 25, 41.
8/ Also during rebuttal, Helen Ellis calculated that there were
220 inpatient cardiac catheterization discharges within the PSA for calendar year 2004. Helen Ellis' reported market share was
22.5 percent. HE 61. If 20 to 25 percent additional potential patients (the by-pass factor) are added to the updated 22.5 percent Helen Ellis's market share based on inpatient cardiac
catheterization discharges within the PSA, Helen Ellis' re- calculated market share for inpatient cardiac catheterizations for calendar year 2004 is 27 to 28.2 percent.
9/ Mr. Richardson, using a population figure for 2010 which is similar to Mr. Nelson's number, assumed there would be 414 (417 projected by Mr. Nelson, HE 63) OHS cases within the PSA in 2010. (The 414 number for 2010 is based primarily on a declining updated OHS use rate; Mr. Nelson forecasted 440 OHS cases for 2008 in the CON application and 417 OHS cases for 2010 (as updated).) T 1868-1869; MP 22; HE 63.)
Mr. Richardson projected that Helen Ellis would have a 21 percent market share (rather than a 27 percent market share) and a 13.8 percent "out-of-area" share, which yielded 101 OHS cases for Helen Ellis' third year of operation in 2010. (A 25.2 percent market share yields 121 OHS cases.) MP 22; T 1873. Mr. Richardson used data for the 12 months ending September 2004 to calculate the 13.8 percent figure. MP 22. Mr. Nelson used cardiac catheterization data for the July 2001 to June 2002 period to achieve the 19.4 percent figure. T 2437.
For 2009, if a 13.8 percent out-of-area rate is substituted for the 19.4 percent rate on Helen Ellis Exhibit 63, (and 22.5 percent is substituted for 27.3 percent market share), the total area discharges would be 92, with 15 "out-of-area" cases, for a total first year of operation projection of 107 OHS cases rather than 139 projected OHS cases for 2009. HE 63; T 2437-2439.
Mr. Nelson believed that Mr. Richardson defined inpatient cardiac catheterization cases differently that he did which might account for the difference. T 2439-2443.
Mr. Richardson, using October 2003 to September 2004 inpatient cardiac catheterization data for Helen Ellis, opined that Helen Ellis' market share within the PSA was 21 percent, which Mr. Nelson says is not "necessarily significant," as long as it is bumped-up by 25 percent to account for the "artificial bypass phenomenon" because Helen Ellis does not have an OHS program, including PCI. T 2395; MP 21. However, he disagrees with Mr. Richardson's conclusion that Helen Ellis will achieve a
21 percent market share in the third year of operation rather than the first. See MP 22.
Mr. Baehr suggested Helen Ellis had a 13.8 percent market share within the PSA. Compare HE 62 with BP 15 at 42; T 2210. Mr. Nelson opined that Mr. Baehr's reliance on a total of 1,591
diagnostic cardiac catheterizations for residents of these zip codes is misplaced, i.e., the math is correct 220/1,591=13.8 percent, BP 15 at page 42, but the denominator is incorrect because, according to Mr. Nelson, the 1,591 number includes all "diagnostic inpatient cardiac cath discharges regardless of any other procedures that the patient would have received during that particular discharge, including open-heart surgery and/or therapeutic catheterization." Mr. Nelson says he excluded the open-heart surgery cases and the therapeutic angioplasty cases from his total. T 2391-2395. See also T 2300-2302, Mr. Baehr discussing some differences between his data and that used by Mr. Richardson. If the 533 "other" discharges reflected on BP exhibit 15 at page 42 are subtracted from the total 1,591, the new total is 1,058 and 21 percent of this number is 222.18 discharges. The 1,591 number includes an "other" category of 533, which is not explained well in this record. See BP 15 at 42.
In other words, Mr. Nelson and Mr. Baehr agree that Helen Ellis performed 220 inpatient diagnostic cardiac catheterizations for calendar year 2004 and from within the PSA, but disagree on the total discharges - 1,591 for Mr. Baehr and 976 for Mr. Nelson. HE 62; BP 15 at 42. This accounts for Mr. Baehr's opinion that Helen Ellis' market share is 13.8 (14 percent) percent (220/1,591) and Mr. Nelson's opinion (in rebuttal) that Helen Ellis has a re-cast 22.5 percent (220/976) market share. T 2391- 2395.
In revised calculations, Mr. Nelson used a "bump-up" or "bypass" factor of 20 to 25 percent. HE 62. Mr. Baehr agreed that a 20-to-40 percent factor to increase diagnostic catheterization market share would be reasonable "[o]nce you have a program in place." T 2243. For Helen Ellis, according to Mr. Baehr, applying a 40 percent factor to a 21 percent market share would bump up its market share to approximately 29 percent as opposed to the 43 percent which Helen Ellis projected in its CON application for the third year of operation, calendar year 2008. HE 1 at 43; T 2301.
10/ The service areas of Largo, Bayfront, and Northside have very minor overlap with Helen Ellis' PSA.
11/ OHS is defined as a tertiary health care service by Agency rule. Fla. Admin. Code R. 59C-1.002(41)(h). "'Tertiary health service' means a health service which, due to its high level of intensity, complexity, specialized or limited applicability, and
cost, should be limited to, and concentrated in, a limited number of hospitals to ensure the quality, availability, and cost-effectiveness of such service." § 408.032(17), Fla. Stat.
12/ Helen Ellis Exhibit 37 is a summary of information derived from approximately 180 patient medical records for cardiac cases at Helen Ellis (transferred for cardiac intervention) from approximately January 2004 through July 2005. Mr. Harbaugh, the Director of Emergency Services at Helen Ellis and an R.N., reviewed approximately 30 percent of these records. (Mr.
Harbaugh began working at Helen Ellis in May of 2005.)
Mr. Harbaugh, the cardiac catheterization lab director, and a person from the medical records department reviewed these documents. The purpose of this exhibit was to determine the time a transfer order was initiated regarding a patient and the time the transfer of the patient was complete, excluding travel time. T 1151. Based upon Exhibit 37, Mr. Harbaugh concluded that it takes an inordinately longtime to transfer a patient out of Helen Ellis for cardiac intervention. Mr. Harbaugh was not aware of any patient outcomes once the patients were transferred.
Several of the individual summaries were discussed during the final hearing in conjunction with the actual medical records for each of these patients. It appears that many of the patients experiencing what has been characterized as a delay, were held overnight at Helen Ellis and transferred the next day pursuant to a physicians' order reflected in the medical records. It was also demonstrated that physicians commonly order that transfers occur the day after the transfer order is written. Some of the information in the summaries was recorded in error and other summaries included patients who should not have been included. (Of the 180 summaries, the number of patients who presented with as acute MI is unknown. T 1150.)
13/ Prior to the 2004 legislative session, only hospitals which had on-site OHS services were authorized to perform PCI or angioplasty services on an emergent or elective basis. However, now, hospitals without OHS back-up, meeting specific statutory criteria, can qualify to perform PCI on patients presenting to the hospital on an emergency basis. On or about September 13, 2005, Helen Ellis received an exemption to provide emergency PCI, which should improve Helen Ellis' ability to treat acute MI patients needing emergency PCI services.
14/ In the most recent fiscal year of 2005, Helen Ellis expected approximately 21,000-22,000 ER department visits. The approximate capacity of the ER department at Helen Ellis is 26,000 visits according to Mr. Harbaugh. The CON application indicates that the current emergency services is close to capacity at 20,000 patient visits, with expansion expected to provide a unit capable of handling 35,000 patient visits. Helen Ellis' CEO stated that there is no current plan to replace or renovate the ER department at Helen Ellis. It is estimated that Helen Ellis will experience approximately 25,000 visits by the end of fiscal year 2007.
15/ Dr. Abbott's testimony regarding one of his patients who coded and died while remaining at Helen Ellis has not been overlooked. It appears that the patient was discharged from the Helen Ellis cardiac catheterization lab stable and upon returning to a telemetry bed coded and died. The records indicate that upon admission to Helen Ellis on March 22, 2004, which he recommended, the patient was pain free. Orders were written triggering the "rule out MI protocol." (The patient was known to have had an MI already.) At the time of admission, Dr. Abbott stated that the patient did not meet the criteria for thrombolytics or emergency PCI as defined by the American College of Cardiology, and it was his opinion that the patient did not need a cardiac catheterization on the date of admission to Helen Ellis. After being treated for a dye allergy on the 23rd, the patient received a cardiac catheterization on the 24th at approximately 11:50 a.m., which took 10 minutes. The record indicates that the patient denied having any pain at that time and was alert and oriented. Dr. Abbott's immediate inclination after the procedure was completed was that the patient could have benefited from bypass surgery, but he made no attempt to transfer the patient because the patient was stable. The patient coded and went into cardiac arrest and died at 12:58
p.m. on the 24th. At the time the patient coded, Dr. Abbott had spoken with an interventional cardiologist and had initiated transfer proceedings for the patient to go to Morton Plant. At the same time, he was "toying with the idea of leaving the sheath in," which potentially could have assisted an interventional cardiologist in performing a PCI. Whether that procedure could have been performed under the circumstances and whether it would have been successful is speculative. T 870- 887.
16/ Helen Ellis does not have a cardiac catheterization lab dedicated solely for these procedures. When its OHS program
opens, it will operate two such labs. One lab will be used for both cardiac and radiological procedures, while the other will be used for both cardiac and electrophysiology procedures. The shared use of the labs is not optimal.
17/ Generally, "[t]he absence of numeric need under the need formula establishes, in effect, a rebuttable presumption of no need." Florida Health Sciences Center, Inc., infra.
COPIES FURNISHED:
Alan Levine, Secretary
Agency for Health Care Administration Fort Knox Building, Suite 3116
2727 Mahan Drive
Tallahassee, Florida 32308
Christa Calamas, General Counsel Agency for Health Care Administration Fort Knox Building, Suite 3431
2727 Mahan Drive
Tallahassee, Florida 32308
Richard Shoop, Agency Clerk
Agency for Health Care Administration 2727 Mahan Drive, Building 3
Mail Station 3
Tallahassee, Florida 32308
Stephen A. Ecenia, Esquire Rutledge, Ecenia, Purnell &
Hoffman, P.A.
215 South Monroe Street, Suite 420 Post Office Box 551
Tallahassee, Florida 32302-0551
Robert A. Weiss, Esquire Parker, Hudson, Rainer &
Dobbs, LLP
The Perkins House, Suite 200
118 North Gadsden Street Tallahassee, Florida 32301
Timothy Elliott, Esquire
Agency for Health Care Administration 2727 Mahan Drive, Building 3
Mail Station 3
Tallahassee, Florida 32308
Geoffrey D. Smith, Esquire Smith and Associates
2873 Remington Green Circle Tallahassee, Florida 32308
NOTICE OF RIGHT TO SUBMIT EXCEPTIONS
All parties have the right to submit written exceptions within
15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the Final Order in this case.
| Issue Date | Document | Summary |
|---|---|---|
| Aug. 31, 2006 | Agency Final Order | |
| Mar. 21, 2006 | Recommended Order | Petitioner did not prove that its CON application should be approved based on "not normal" circumstances and on a balanced consideration of the applicable statute and rule criteria. |
