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RENDITION NO.: AHCA-11- /Of.,5-FOF-CON

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FLORIDA HEALTH SCIENCES CENTER, INC. d/b/a TAMPA GENERAL HOSPJTAL,

ZOil OCT - 3 A 8: tib

Petitioner, DOAH CASE NO. 08-0614CON

AHCA NO. 2008001030

V.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION,

Respondent,

and

SUN CITY HOSPITAL, INC. d/b/a SOUTH BAY HOSPITAL,

Intervenor.

I

ST. JOSEPH'S HOSPITAL, INC. d/b/a ST. JOSEPH'S HOSPITAL,

Petitioner, DOAH CASE NO. 08-0615CON

AHCA CASE NO. 2008001029

V.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION and SUN CITY HOSPITAL, INC. d/b/a SOUTH BAY HOSPITAL,

Respondents.

I

SUN CITY HOSPITAL, INC. d/b/a SOUTH BAY HOSPITAL,

Petitioner, DOAH CASE NO. 08-1205CON

AHCA CASE NO. 2008003028

V.

ST. JOSEPH'S HOSPITAL, INC. and STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION,

Respondents.

I

1

Filed December 8, 2011 12:15 PM Division of Administrative Hearings

FINAL ORDER

This cause was referred to the Division of Administrative Hearings where the assigned Administrative Law Judge (ALJ), Charles A. Stampelos, conducted a formal administrative hearing. At issue in this case is whether Sun City Hospital, Inc. d/b/a South Bay Hospital's ("South Bay") Certificate of Need ("CON") Application No. 9992 for a 112-bed replacement hospital in Riverview, Hillsborough County, Florida should be approved. The Recommended Order dated August 8, 2011, is attached to this Final Order and incorporated herein by reference,

except where noted infra.

RULING ON EXCEPTIONS

South Bay filed exceptions to the Recommended Order, and St. Joseph's Hospital, Inc. d/b/a St. Joseph's Hospital ("St. Joseph's") and Florida Health Sciences Center, Inc. d/b/a Tampa General Hospital ("Tampa General") filed a Joint Response to South Bay's exceptions.

In determining how to rule on the exceptions and whether to adopt the ALJ's Recommended Order in whole or in part, the Agency for Health Care Administration ("Agency" or "AHCA") must follow section 120.57(1)([), Florida Statutes, which provides in pertinent part:

The agency may adopt the recommended order as the final order of the agency. The agency in its final order may reject or modify the conclusions of law over which it has substantive jurisdiction and interpretation of administrative rules over which it has substantive jurisdiction. When rejecting or modifying such conclusion of law or interpretation of administrative rule, the agency must state with particularity its reasons for rejecting or modifying such conclusion of law or interpretation of administrative rule and must make a finding that its substituted conclusion of law or interpretation of administrative rule is as or more reasonable than that which was rejected or modified. Rejection or modification of conclusions of law may not form the basis for rejection or modification of findings of fact. The agency may not reject or modify the findings of fact unless the agency first determines from a review of the entire record, and states with particularity in the order, that the findings of fact were not based upon competent substantial evidence or that the proceedings on which the findings were based did not comply with essential requirements of law....

§ 120.57(1)(/), Fla. Stat. Additionally, "[t]he final order shall include an explicit ruling on each exception, but an agency need not rule on an exception that does not clearly identify the disputed portion of the recommended order by page number or paragraph, that does not identify the legal basis for the exception, or that does not include appropriate and specific citations to the record."

§ 120.57(1)(k), Fla. Stat.

In accordance with these legal standards, the Agency makes the following rulings:

,

In its first exception1 South Bay takes exception to the findings of fact in Paragraphs 145-147 of the Recommended Order, arguing that the ALJ imposes a "need" standard on South Bay that is not in law or rule. South Bay suggests that there should not be a consideration of institution-specific" need versus "community" needs in regards to replacement hospitals. St. Joseph's and Tampa General respond by insisting that the findings of fact are supported by competent, substantial evidence and reflect not only controlling law and long-standing Agency precedent but also the stipulations of all parties to this case. The findings of fact in Paragraphs 145-147 of the Recommended Order are based on competent, substantial evidence. See Transcript, Volume 3, Pages 310-312; Transcript, Volume 4, Pages 407, 435-436, 440-441, 452-

453, 464-465 and 468; and Transcript, Volume 7, Pages 1018 and 1039-1040. Thus, the Agency cannot reject or modify them. See § 120.57(1)(/), Fla. Stat.; Heifetz v. Dep't of Bus. Reg., 475 So.2d 1277, 1281 (Fla. 1st DCA 1985).

Additionally, contrary to South Bay's argument, the Agency does consider both "institution-specific" needs and "community" needs in order to determine the need for a replacement hospital. See HCA Health Servs. of Fla., Inc. d/b/a Oak Hill Hosp. v. Agency for

1 The Agency considers Roman numeral II of South Bay's exceptions to be the first exception since Roman numeral I of South Bay's exceptions, which is entitled "Preface", is not a valid exception because it does not clearly identify the disputed portion of the recommended order by page number or paragraph, does not identify the legal basis for the exception, and does not include appropriate and specific citations to the record as required by § 120.57(1)(k), Fla. Stat. Likewise, the Agency will not address Roman numeral XII of South Bay's exceptions for the same reason.

Health Care Admin., DOAH Case No. 02-0454CON (AHCA 2002); and Morton Plant Hospital

Ass'n, Inc. d/b/a North Bay Hosp. v. Agency for Health Care Admin., DOAH Case No. 02- 3232CON (AHCA 2004). Unlike the Oak Hill and North Bay cases, South Bay's existing facility, even with its short-comings, is in good condition and well-utilized. Furthermore, as the ALJ noted, "approval will reduce access for the elderly residents of the Sun City Center area," and "will result in the duplication of these services in the service area by placing two facilities

virtually across the street on Big Bend Road." See Paragraph 367 of the Recommended Order.

All of these factors combined distinguish this case from those of Oak Hill and North Bay. and weigh against approval of South Bay's CON application. Therefore, the Agency denies South Bay's first exception.

In its second exception, South Bay takes exception to the findings of fact in Paragraph

178 of the Recommended Order, arguing that they are not findings of fact, but rather speculations. As pointed out by St, Joseph's and Tampa General, South Bay's argument is without merit. The findings of fact in Paragraph 178 of the Recommended Order are based on competent, substantial evidence. See, , Transcript, Volume 7, Pages 1009-1010; and Transcript, Volume 8, Pages 1191-1192 . Thus, the Agency is not at liberty to reject or modify them. See § 120.57(1)(/), Fla. Stat.; Heifetz. Therefore, the Agency must deny South Bay's second exception.

In its third exception, South Bay takes exception to the findings of fact in Paragraph 192 of the Recommended Order, arguing that the last two sentences of the paragraph were not based on competent, substantial evidence. Contrary to South Bay's argument, all of the findings of fact

in Paragraph 192 of the Recommended Order are based on competent, substantial evidence. See Transcript, Volume 12, Pages 1844-1845; and St. Joseph's Exhibit 19B. Thus, the Agency

cannot reject or modify the ALJ's findings of fact. See § 120.57(1)(/), Fla. Stat.; Heifetz. Therefore, the Agency must deny South Bay's third exception.

In its fourth exception, South Bay takes exception to the findings of fact in Paragraph 195 of the Recommended Order. South Bay first argues that the ALJ's findings regarding "674 east of U.S. Highway 301' are irrelevant. However, relevancy is not a factor that the Agency may consider when determining whether to accept or reject a finding of fact pursuant to § 120.57(1)(/), Fla. Stat. If the ALJ's finding of fact is based on competent, substantial evidence then the Agency cannot reject or modify it. See § 120.57(1)(/), Fla. Stat.; Heifetz. The ALJ's findings regarding "674 east of U.S. Highway 301" are based on competent, substantial

evidence. See Transcript, Volume 12, Pages 1856-1859 and 1887; and St. Joseph's Exhibit 19C. Thus, South Bay's first argument is meritless. Second, South Bay argues that the ALJ's findings in the last sentence of Paragraph 195 have no basis in the record. St. Joseph's and Tampa General responded to this argument by stating that the last sentence of Paragraph 195 of the Recommended Order contains a typographical error. According to them, the last sentence of

Paragraph 195 of the Recommended Order should read as follows: "The LOS ofl-75 is expected to drop to 'D.,_' m and the entirety of Big Bend Road between U.S. Highway 301 and 1-75 is

projected to degrade to LOS 'F' by 2020." St. Joseph's and Tampa General's response is supported by the record evidence presented in this matter. See Transcript, Volume 12, Page 1859; and St. Joseph's Exhibit 19C. Thus, South Bay's argument is more akin to a motion for scrivener's error, which the Agency shall grant, and shall modify the last sentence of Paragraph 195 of the Recommended Order as noted above.

In its fifth exception, South Bay takes exception to the finding of fact in Paragraph 237 of the Recommended Order based on the arguments it set forth in its third and fourth exceptions.

Using the reasoning set forth in the ruling on South Bay's third and fourth exceptions supra, the Agency denies South Bay's fifth exception.

In its sixth exception, South Bay takes exception to the findings of fact in Paragraph 257 of the Recommended Order. South Bay argues that the findings are speculative rather than factual, and that the finding that "[e]conomic impacts to [Tampa General] are of record" is clearly insufficient. As pointed out by St. Joseph's and Tampa General in their response to South Bay's exceptions, the findings of fact in Paragraph 257 of the Recommended Order are based on ample competent, substantial evidence. See Transcript, Volume 10, Pages 1574-1575 and 1638; Transcript, Volume 11, Pages 1725-1727; St. Joseph's Exhibit 17; and Tampa General's Exhibit 3. Thus, the Agency cannot reject or modify them. See § 120.57(1)(/), Fla.

Stat.; Heifetz. Therefore, the Agency denies South Bay's sixth exception.

In its seventh exception, South Bay takes exception to the conclusion of law in Paragraph 342 of the Recommended Order, arguing that it "is nothing more than a subjective determination made by the ALJ based upon two outdated health planning principles having no application to a replacement hospital proposal." Using the reasoning set forth in the ruling on South Bay's first

exception supra, the Agency finds that, while it has substantive jurisdiction over the conclusions of law in Paragraph 342 of the Recommended Order, it could not substitute conclusions of law that are as or more reasonable than those of the ALJ. Therefore, the Agency denies South Bay's seventh exception.

In its eighth exception, South Bay takes exception to the conclusion of law in Paragraph 359 of the Recommended Order, arguing that it is unsupported by any record evidence. Using

the reasoning set forth in the ruling on South Bay's sixth exception supra, the Agency denies South Bay's eighth exception.

In its ninth exception, South Bay takes exception to the conclusions of law in Paragraph 361 of the Recommended Order, arguing that they misstate law and policy. Using the reasoning

set forth in the ruling on South Bay's first exception supra, the Agency finds that, while it does have substantive jurisdiction over the conclusions of law in Paragraph 361 of the Recommended Order, it could not substitute conclusions of law that are as or more reasonable than those of the ALJ. Therefore, the Agency denies South Bay's ninth exception.

In its tenth exception, South Bay takes exception to the conclusions of law in Paragraph 370 of the Recommended Order, arguing that the Agency should reject the conclusions of law because it is more reasonable for the Agency to approve South Bay's CON application. Using

the reasoning set forth in the ruling on South Bay's first exception supra, the Agency finds that, while it does have substantive jurisdiction over the conclusions of law in Paragraph 370 of the Recommended Order, it could not substitute conclusions of law that are as or more reasonable than those of the ALJ. Therefore, the Agency denies South Bay's tenth exception.

FINDINGS OF FACT

The Agency adopts the findings of fact set forth in the Recommended Order except

where noted supra.

CONCLUSIONS OF LAW

The Agency adopts the conclusions of law set forth in the Recommended Order.

ORDER

Based upon the foregoing, the Agency hereby denies South Bay's CON Application No.

9992. The parties shall govern themselves accordingly.

DONE and ORDERED this 30 day of be-r-­

Florida.

, 2011, in Tallahassee,

NOTICE OF RIGHT TO JUDICIAL REVIEW

A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW, WHICH SHALL BE INSTITUTED BY FILING THE ORIGINAL NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A COPY, ALONG WITH THE FILING FEE 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 THE RENDITION OF THE ORDER TO BE REVIEWED.

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true and correct copy of the foregoing Final Orde as been furnished by U.S. or interoffice mail to the persons named below on this - day of

, 2011.

Agency for Health Care Administration 2727 Mahan Drive, MS #3

Tallahassee, FL 32308

(850) 412-3630

COPIES FURNISHED TO:

Honorable Charles A. Stampelos Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

Stephen A. Ecenia, Esquire Rutledge, Ecenia & Purnell, P.A. 119 South Monroe Street, Suite 202 Post Office Box 551

Tallahassee, Florida 32302-0551

Karen A. Putnal, Esquire

Parker, Hudson, Rainer & Dobbs, LLP The Perkins House, Suite 200

118 North Gadsden Street Tallahassee, Florida 32301

Jeffrey L. Frehn, Esquire

Ratley, Thomas, Yon & Clark, P.A. 301 South Bronough Street, Suite 200

Tallahassee, Florida 32301

Lorraine M. Novak, Esquire Assistant General Counsel

Agency for Health Care Administration 2727 Mahan Drive, MS #3

Tallahassee, Florida 32308

Jan Mills

Facilities Intake Unit

Docket for Case No: 08-000614CON

Orders for Case No: 08-000614CON