STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
UNIVERSITY OF MIAMI, d/b/a UNIVERSITY OF MIAMI HOSPITAL AND CLINICS,
Petitioner,
vs.
BAPTIST HOSPITAL OF MIAMI, INC., AND AGENCY FOR HEALTH CARE ADMINISTRATION,
Respondents.
/
Case No. 17-5301CON
RECOMMENDED ORDER
Pursuant to notice, a final hearing was conducted on December 15, 18, 20 through 22, 2017; January 22, 26, 29, 2018; and February 1 and 2, 2018, in Tallahassee, Florida, before Garnett W. Chisenhall, a duly designated Administrative Law Judge of the Division of Administrative Hearings (“DOAH”).
APPEARANCES
For the University of Miami, d/b/a University of Miami Hospital and Clinics:
M. Stephen Turner, Esquire Frank P. Rainer, Esquire Leonard M. Collins, Esquire Broad and Cassel
Suite 400
215 South Monroe Street Tallahassee, Florida 32301
For Baptist Hospital of Miami, Inc.:
Seann M. Frazier, Esquire Marc Ito, Esquire
Parker Hudson Rainer & Dobbs, LLP Suite 750
215 South Monroe Street Tallahassee, Florida 32301
Jonathan L. Rue, Esquire
Parker, Hudson, Rainer & Dobbs, LLP Suite 3600
303 Peachtree Street Northeast Atlanta, Georgia 30308
For the Agency for Health Care Administration:
Richard Joseph Saliba, Esquire Lindsey L. Miller-Hailey, Esquire Kevin Michael Marker, Esquire
Agency for Health Care Administration Mail Stop 7
Fort Knox Building III 2727 Mahan Drive
Tallahassee, Florida 32308 STATEMENT OF THE ISSUE
Whether the Certificate of Need (“CON”) Application
No. 10490 submitted by Baptist Hospital of Miami, Inc. (“Baptist Hospital” or “Baptist”), to establish a new adult autologous and allogeneic bone marrow transplant program in Florida’s Organ Transplant Service Area 4 (“TSA 4”) should be approved.
PRELIMINARY STATEMENT
On or before May 17, 2017, Baptist filed CON Application No. 10490 to establish an adult inpatient autologous and allogeneic bone marrow transplant program located in Miami-Dade County, TSA 4. The Agency for Health Care Administration
(“AHCA”) preliminarily approved Baptist's CON application on August 18, 2017.
On September 7, 2017, the University of Miami, d/b/a University of Miami Hospital and Clinics (“UM”) filed a petition challenging AHCA's preliminary approval. AHCA referred UM's petition to DOAH on September 22, 2017.
The final hearing was held on December 15, 18, 20 through 22, 2017; January 22, 26, 29, 2018; and February 1 and 2, 2018.
At the final hearing, Baptist presented the testimony of Wayne Brackin; Michael Zinner, M.D.; Lyle Feinstein, M.D.; Leonard Kalman, M.D.; Miguel Villalona-Calero, M.D.; Jeffrey Boyd, Ph.D.; Minesh Mehta, M.D.; Maria Mercedes Rios; Faith Solkoff; Jason Bell; Becky Montesino-King; Edward Shashaty; Guenther Koehne, M.D.; and Mark Richardson.
Baptist's Exhibits Nos. 3, 6 through 14, 17, 18, 21, 22,
26, 27, 29, 31 through 32, 37 through 38, 41, 42, 49, 52, 54,
60, 63, 69, and 75 were admitted into evidence.
AHCA presented the testimony of Marisol Fitch. AHCA’s sole exhibit, Exhibit No. 1, was admitted into evidence.
UM presented the testimony of Stephen Nimer, M.D.; Hugo Fernandez, M.D.; Thomas Davidson; Denise Pereira, M.D.; Sharon Gordon-Girvin; Cara Benjamin, Ph.D.; and Claudio Anasetti, M.D.
UM's Exhibit Nos. 1A through 1G, 2, 3, 6, 11, 22, 23, 29, 30, and 31 were admitted into evidence.
To the extent that there are any pending requests by UM to accept exhibits and/or testimony, those requests are denied.
The Transcript of the final hearing, consisting of
18 volumes, was filed on February 27, 2018.
After receiving two extensions, the parties filed timely Proposed Recommended Orders on April 30, 2018, and the undersigned considered them in the preparation of this Recommended Order.
FINDINGS OF FACT
Bone Marrow Transplants
Bone marrow transplantation is performed after a patient has received very high doses of chemotherapy in order to eradicate cancer.
High doses of chemotherapy can cure cancerous cells or cause remission, but chemotherapy can also damage healthy cells. Damage may be done to progenitor cells that create the components for blood, including white blood cells. If progenitor cells are damaged by chemotherapy, the patient may succumb to infection and bleeding.
To avoid this problem, physicians remove blood-producing progenitor cells from the patient's blood and bone marrow, and store them while the patient receives chemotherapy. The patient is then reinfused with progenitor blood cells, allowing the patient to make normal blood and recover. This infusion of
progenitor cells is commonly referred to as bone marrow transplantation ("BMT").
BMT has become an essential method of fighting blood cancers.
BMT is offered in hospital settings, and most transplants are performed on an inpatient basis. However, certain types of BMT services are more frequently being offered on an outpatient basis.
BMTs are categorized as either autologous or allogeneic.
In autologous BMTs, the patient's own blood and bone marrow cells are removed and then reinfused after chemotherapy.
The process begins with apheresis to collect the patient's bone marrow and blood cells. The patient's blood is processed through a machine that separates progenitor cells and stores them. The process of apheresis may take up to five hours.
The cells are frozen for later use. The process of freezing blood product is referred to as cryopreservation.
The patient then receives chemotherapy and is then reinfused with the patient's own blood and bone marrow cells.
Some cancer patients, such as acute leukemia patients, have malignant or compromised blood progenitor cells. In those cases, autologous transplantation is not an option. Instead, progenitor cells must be obtained from an alternative donor, such as a family member or a compatible nonrelative.
Allogeneic transplants carry a higher risk of complications, primarily because the introduction of another person's progenitor cells may cause "graft vs. host" disease, which involves the patient’s rejection of the infused cells.
Histocompatibility tests help determine whether donated progenitor cells will successfully match with the patient and reduce the chances of graft vs. host disease.
BMT is a relatively rare procedure. In 2014, there were 17,303 BMT procedures in the United States involving patients over the age of 21. In 2016, there were 1,026 cases in Florida involving patients over the age of 15.
The Regulatory Framework
Section 408.032(17), Florida Statutes (2018),1/ defines a “tertiary health service” as
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. Examples of such service include, but are not limited to, pediatric cardiac catheterization, pediatric open-heart surgery, organ transplantation, neonatal intensive care units, comprehensive rehabilitation, and medical or surgical services which are experimental or developmental in nature to the extent that the provision of such services is not yet contemplated within the commonly accepted course of diagnosis or treatment for the condition addressed by a given service.
As a tertiary health service, inpatient BMT may only be offered once a hospital has obtained a CON. See §§ 408.032(17), 408.036(1)(f), Fla. Stat.; Fla. Admin. Code R. 59C-1.044.
The statutory review criteria for CONs are set forth in section 408.035.
The criteria include factors such as: (a) the need for the health service proposed; (b) the applicant’s ability to provide quality care; (c) the extent to which the proposed service will enhance access to healthcare for residents in the applicable service district; and (d) the immediate and long-term financial feasibility of the proposal.
AHCA has published Florida Administrative Code
Rule 59C-1.044 governing CON review for transplantation services. Subsections (3), (4), (5) set forth criteria that applicants for several different types of transplant programs must satisfy.
Subsections (9) and (10) set forth criteria that BMT applicants must "normally" meet before a new transplant program will be approved. AHCA may approve a CON for BMT services when an applicant demonstrates that not-normal circumstances are present.
For many CON-regulated services, AHCA predicts the future need for additional beds or services by announcing a "fixed need pool," establishing a numerical need for new programs around the state. See, e.g., Fla. Admin. Code R. 59C-1.0355
(establishing fixed need pool methodology for hospices);
59C-1.036 (pertaining to nursing facility beds), 59C-1.039 (pertaining to comprehensive medical rehabilitation beds).
The establishment of a fixed need pool creates a rebuttable presumption that a new service is or is not needed. Balsam v. Dep’t. of HRS, 486 So. 2d 1341 (Fla. 1st DCA 1986);
Humhosco, Inc. v. Dep’t. of HRS, 476 So. 2d 258 (Fla. 1st DCA
1985).
However, there is no fixed need pool for organ transplantation services such as BMT. With regard to need, a BMT CON applicant must reliably project that it will annually perform 10 autologous and 10 allogeneic transplants. See Fla.
Admin. Code R. 59C-1.044(9)(b)1. (pertaining to adult allogeneic BMT programs and stating such applicants “shall be able to project that at least 10 adult allogeneic transplants will be performed each year. New units shall be able to project the minimum volume for the third year of operation.”); Fla. Admin.
Code R. 59C-1.044(9)(c)1. (pertaining to adult autologous BMT programs and stating that such applicants “shall be able to project that at least 10 adult autologous transplants will be performed each year. New units shall be able to project the minimum volume for the third year of operation.”).
Rule 59C-1.044(2)(f) provides that “[p]lanning for organ transplantation programs shall be done on a regionalized basis.” Accordingly, the rule establishes four transplant
service areas (“TSA”), and each one corresponds to an area containing approximately 25 percent of Florida’s population.
The TSA relevant to the instant case is TSA 4, which consists of Broward, Miami-Dade, Monroe, Collier, and Palm Beach Counties.
The Parties
Baptist Hospital
Baptist Health South Florida (“BHSF”) is a not-for- profit, faith-based community healthcare organization that operates nine hospitals, approximately 50 outpatient centers, and a medical group serving South Florida, from the Keys to the Palm Beaches. Though each is separately incorporated, all of BHSF's hospitals report to BHSF leadership and represent an integrated hospital system.
BHSF has traditionally offered cancer treatment throughout its hospitals.
BHSF sought to create a comprehensive cancer institute to serve South Florida, the Caribbean, and Latin America. The cancer institute would offer complete cancer care, from screening and diagnosis, to treatment, and psychosocial support, all the way to palliative care.
BHSF created the Miami Cancer Institute (“MCI”) to consolidate the cancer services it offered at many of its hospitals into a single location at Baptist Hospital. The goal
was to offer integrated care, so that everything a cancer patient might need could be offered at one location.
Though separately incorporated, MCI is an outpatient department of Baptist Hospital in Miami-Dade County, Florida.2/ All of MCI's services are billed through Baptist Hospital, and MCI’s management reports to Baptist Hospital’s administration.3/
MCI sees between 800 and 1,000 cancer patients a day.
Because BMT is required to cure most hematological malignancies, including leukemia, myelodysplastic syndrome, pyelolymphatic disorders, myeloma, and lymphoma, BMT services are essential to MCI becoming a comprehensive cancer care center.
Consultants and leaders at MCI also concluded that MCI must offer inpatient BMT in order for MCI to offer the full range of care needed by cancer patients.
Therefore, Baptist applied to obtain the CON at issue in this proceeding.
Baptist recently completed the process of becoming an affiliate of the Memorial Sloan Kettering (“MSK”) Cancer Center in New York. That alliance has now been formed and is operational.
MSK is the United States’ leading center for cancer treatment and BMT.
The alliance between Baptist and MSK is a strong, integrated linkage between the clinical and research efforts of both organizations.
The alliance provides Baptist’s patients with the latest BMT protocols and techniques. MSK and its cancer research will now be able to add a genomic database of Hispanic cancer patients that may result in improved treatment for patients not of European descent.
The University of Miami
The University of Miami (“UM”) was established in 1925 and is one of Florida’s preeminent universities. The
University of Miami Hospital and Clinics (“UMHC”), the Sylvester Comprehensive Cancer Center (“Sylvester”), and the Miller School of Medicine are all part of UM and are all located in Miami-Dade County, Florida.
UM’s medical facilities (the Miller School of Medicine, the University of Miami Hospital, Sylvester, and Anne Bates Leach Eye Center) are located on a medical campus shared with Jackson Memorial Hospital in Miami.
Sylvester is a 40-bed specialty care center hospital, and the care offered to the residents of South Florida has achieved significant statewide and national prominence.
UM is recognized as a Prospective Payment System (“PPS”) exempt institute, which allows it special reimbursement
treatment from Medicare for purposes of reimbursement for cancer care provided at Sylvester. There are only 11 such centers in the country.
According to AHCA’s discharge database, 147 residents of TSA 4 received BMT treatment in calendar year 2016 at UM.4/
In 2016, UM performed the second highest number of BMTs in Florida.5/
AHCA
AHCA is the state agency charged with administering Florida’s CON program. A CON is required before a hospital may offer inpatient BMT. A CON is not required to establish and operate an outpatient BMT program because outpatient services are exempt from CON review.
The Non-Parties
H. Lee Moffitt Cancer Center (“Moffitt”) is located in Hillsborough County, Florida. Moffitt is the largest BMT program in Florida, performing more than 400 BMT procedures annually. Moffitt is a recognized cancer hospital, and its physicians are recognized cancer researchers.
Fifty to 60 residents of TSA 4 travel outside of South Florida each year in order to receive BMT, and the majority receive that treatment at Moffitt. Because the distance from Miami to Moffitt is 250 to 280 miles and a course of treatment can take two to three months, it is a substantial burden for
patients in TSA 4 with limited resources to receive BMT treatment at Moffitt.
Memorial Hospital West (“Memorial West”) is located in Broward County. Memorial West and UM are the only operational CON-approved adult service providers of BMT services in TSA 4.
Memorial West has been a low volume provider of BMT. According to AHCA’s State Agency Action Report(“SAAR”), Memorial West performed nine inpatient BMT procedures in 2012, 15 in 2013, 20 in 2014, 15 in 2015, and four in 2016.
Shortly before the final hearing in this matter, Memorial West affiliated with Moffitt in hopes of reinvigorating its largely inactive program.
Moffitt has fully staffed and assumed all clinical operations in the Memorial West program. Under Moffitt leadership and clinical management, the Memorial West program performed eight allogeneic and 19 autologous BMTs between July 1, 2017, and January 26, 2018.
Good Samaritan Hospital (“Good Samaritan”) is located in Palm Beach County. For many years, Good Samaritan reported to AHCA that it provided a moderately large volume of inpatient BMT. For instance, Good Samaritan reported doing 42 BMTs in 2016.
However, it was recently discovered that Good Samaritan had been incorrectly reporting bone marrow biopsies as bone marrow transplants.
All parties now acknowledge that Good Samaritan does not have a BMT program.
The Prior Proceeding
During the October 2015 Other Beds and Programs CON Batching Cycle, Baptist Hospital filed an application to establish a new adult inpatient autologous and allogeneic BMT program in TSA 4.
On February 19, 2016, AHCA issued a SAAR preliminarily approving the application.
On March 11, 2016, UM filed a petition challenging AHCA’s preliminary decision, and the petition was assigned DOAH Case No. 16-1698CON.
After a nine-day hearing in September 2016, Administrative Law Judge (“ALJ”) James H. Peterson, III, issued a Recommended Order on March 30, 2017, recommending that AHCA deny Baptist’s CON application.
AHCA rendered a Final Order on June 13, 2017, adopting ALJ Peterson’s recommendation.6/
The Current CON Application
Baptist’s current application seeks to establish an adult inpatient autologous and allogeneic bone marrow transplant program located in TSA 4.
On August 18, 2017, AHCA issued a SAAR preliminarily approving Baptist's CON application.
Baptist has self-imposed three conditions on its application. The first condition is that the proposed BMT program will be located at Baptist Hospital. The second condition is that 12 acute-care beds will be delicensed so as to convert an 18-bed unit to a 6-bed inpatient BMT unit. The third condition is that Baptist will provide at least 10 percent of its inpatient BMT case volume on an annual basis to Medicaid (including managed Medicaid), charity, or self-pay payments.
AHCA is requiring that Baptist establish an on-site cryopreservation lab as a condition of approval for its CON.
Outpatient BMT has already begun at Baptist because a CON is not required for outpatient services.
It is assumed that Baptist will achieve accreditation from the Foundation for the Accreditation of Cellular Therapy (“FACT”) for autologous BMT before the first inpatient procedures are performed. FACT accreditation is the key to receiving reimbursement from federal payors and private insurers.
Baptist does not plan to perform any inpatient BMTs until it has completed a year of outpatient autologous procedures.
AHCA received letters from several Florida state legislators and local government officials expressing support for Baptist’s application.
The Statutory Review Criteria
Section 408.035(1)(a) – The Need for BMT in TSA 4
Because the rule governing applicants for autologous and allogeneic BMT programs requires applicants to demonstrate the ability to perform 10 autologous and 10 allogeneic BMTs a year, a forecast of the future need for BMT by TSA 4 residents is necessary in order to evaluate whether Baptist can satisfy that requirement.
AHCA’s discharge database includes inpatient treatments and excludes outpatient treatments because outpatients are not admitted. That database indicates that 215 TSA 4 residents received BMTs at a CON-approved hospital in Florida for the
12 months ending September 2016.
Sixty-two TSA 4 residents received their treatment at a facility outside TSA 4 during the 12 months ending in December 2016.
The number of outmigration cases has remained relatively constant over the last 10 years despite the fact that UM has entered the BMT market and steadily increased the number of BMTs it performs.
Baptist’s current application projects the increase in TSA 4's adult inpatient BMT case volume for 2019 (year one of operation) and 2020 (year two of operation) using three different annual growth rates (five percent, seven percent, and nine percent). This analysis forecasts increases of 34 to 63 BMT cases in 2019 and 46 to 88 cases in 2020, depending on the growth rate applied. In other words, Baptist projects that inpatient BMT need in 2019 for TSA 4 will be between 249 and 278 cases, and Baptist projects that inpatient BMT need for TSA 4 in 2020 will be between 261 and 303 cases.
UM predicts that the need for adult inpatient BMT in TSA 4 in 2020 will be 277 cases.
Both parties’ need projections are reasonable.
Even if the demand for BMT by TSA 4 residents only grows by five percent a year, the resulting number of BMT cases will be higher than Baptist's projected volumes of 22 cases in year one and 30 cases in year two. This indicates that there will be adequate growth to support Baptist's BMT program and the existing providers.
With regard to the need for BMT in TSA 4, Baptist’s health planning expert testified that:
the number of adult inpatient bone marrow transplant cases that will be performed on residents of TSA 4 will grow by more than the 22 and 30 cases that are forecasted for Baptist Hospital. In other words, the market
is growing enough that Baptist can achieve its volume and existing providers can maintain at least their current level of service.
There are circumstances indicating that a five percent annual growth rate for inpatient BMT is conservative and likely to underestimate the actual need among TSA 4 residents.
For instance, national volume data for BMT from the Center for International Blood and Marrow Transplant Research (“the CIBMTR”) shows that there has been strong and continuous growth in autologous and allogeneic BMT over the last 10 years in the United States.
In 2010, there were 16,668 BMTs in the United States.
By 2014, that number had grown to 19,862, which represents a five percent average annual growth rate.
More recent data from the CIBMTR indicates that there were 21,292 BMTs performed in the United States during 2015, which represents a seven percent growth rate from 2014 to 2015.
The number of BMT procedures is reliably growing every year, and that is partially due to slight increases in population. This increase is also due to the fact that additional types of patients might benefit from BMT.
There has also been an increase in the number of BMTs performed in Florida. Total adult inpatient BMT cases
performed in all Florida hospitals have grown from 671 procedures
for the 12 months ending September 2012, to 917 procedures for the 12 months ending September 2016. That amounts to an increase of 246 inpatient cases over a four-year period, or an average annual increase of 62 cases each year. In percentage terms, that is a 37 percent increase from 2012 to 2016 and an annual average percentage growth of nine percent per year.
A review of the most recent yearly increase, from 2015 to 2016, demonstrates there were 68 new cases and a percentage growth of eight percent.
As for circumstances specific to TSA 4, the total population in South Florida is increasing at a rate of approximately one percent per year. The segment of the population over the age of 15 is growing at a slightly higher rate than the total population.
People over the age of 61 are receiving more BMTs than in the past. Because the elderly (65+) show the highest percentage population growth in TSA 4, the increased volume for this population will impact the overall volume growth forecasted for TSA 4.
There is additional room for BMT use to increase in TSA 4 because that area’s utilization of BMT is low in comparison to other geographic areas.
AHCA discharge data shows an overall adult BMT use rate for TSA 4 residents of 4.12 cases per 100,000 people, and the use rate for all of Florida is 5.07 cases per 100,000 people.
The greater weight of the evidence demonstrates that the number of inpatient BMT cases in TSA 4 will increase to at least 249 cases in 2019 and to at least 261 cases in 2020. The greater weight of the evidence also demonstrates that the aforementioned forecasts are conservative and that the actual increases are likely to be higher.
Section 408.035(1)(b) – The Existing Health Services in the Service District of the Applicant
Section 408.035(1)(b) requires AHCA to evaluate “[t]he availability, quality of care, accessibility, and extent of utilization of existing health care facilities and health services in the service district of the applicant.” (emphasis
added).
Section 408.032(5) divides Florida into 11 health service planning districts. District 11 consists of Miami-Dade and Monroe Counties.
UM is the only BMT provider in District 11. Memorial West is located in District 10, which encompasses Broward County.
Therefore, section 408.032(5) excludes Memorial West from this analysis.
Good Samaritan does not have a BMT program.
While UM is the only authorized and operational provider of inpatient BMT services in Miami-Dade County, UM did not provide BMT to a single charity care patient between 2014 and 2016, despite committing to do so.
UM's lack of service to charity BMT patients is consistent with its financial reports to the state.
UM has the ability to provide charity care. In 2016, UMHC reported a net income of approximately $175 million.
As the only existing local BMT provider in the community, UM's failure to provide any charity care presents an access limitation for charity patients.
The lack of outpatient BMT presents another access issue.
UM does not plan to perform any outpatient BMT procedures even though the medical trend is that more and more of the less complicated autologous BMT procedures are being performed on an outpatient basis. Some countries in Europe are even experimenting with autologous transplantation performed in the patient's home.
For some patients that live in the Miami area, outpatient BMT presents a more convenient alternative than a long
hospital stay. The inability to access a BMT provider willing to perform outpatient BMT is an access issue.
Another access issue involves the utilization of UM’s BMT capacity.
The number of BMT procedures performed at UM has steadily increased over time and jumped by more than
70 procedures in 2017 alone. UM's physicians predicted that the number of BMT procedures would grow by 65 in the current year, allowing UM to reach volumes it has never achieved before.
Those volumes have allowed UM to conduct research and educational activities.
As a result of increasing volumes, UM's BMT program has used a progressively higher number of beds within the hospital. UM's BMT program is on track to treat 240 patients and will have to utilize other beds in addition to the 12 beds originally set aside for BMT.
Another access issue pertains to the types of cases that outmigrate from TSA 4. Baptist’s application contained data indicating that a disproportionate amount of the outmigration cases are complex in nature, and the SAAR states the following:
the applicant notes that the highest level of outmigration was observed in allogeneic BMT patients which accounted for 41 percent of outmigration cases. [Baptist] states that these patients require the longest
post-discharge treatment regimen and for this reason high levels of outmigration are evidence of a significant problem.
Autologous cases with complications account for 23 percent of outmigration cases and autologous patients without complications account for four percent of outmigration cases. The applicant reiterates that the proposed project is expected to target these patients as a local alternative to care outside of OTSA 4.
The fact that Good Samaritan does not have a BMT program may be the most significant access issue in this particular service district, and that amounts to a substantial change in circumstances since the prior proceeding. ALJ Peterson’s Recommended Order indicates that he evaluated the existing provision of BMT in District 11 based on the premise that Good Samaritan had an operational BMT program.
The greater weight of the evidence demonstrates that access to BMT in District 11 is less than optimal, especially given that all parties now accept that Good Samaritan does not have a BMT program.
Section 408.035(1)(c) – The Applicant’s Ability and History Regarding Quality of Care
Baptist offers high quality healthcare. Evidence of past quality is demonstrated by Baptist's numerous accreditations and quality awards.
U.S. News and World Report studied patient safety and
mortality rates in U.S. hospitals and surveyed 30,000 physicians
in 5,000 hospitals across the country. The publication ranked BHSF as the highest performing healthcare organization in South Florida, and eighth best in Florida.
Since the CON application was filed, BHSF has risen to sixth best in the state.
Baptist is one of only eight hospitals in the world, and the first hospital in Florida, to receive the Magnet Award, an award for nursing practice from the American Nursing Association. The American Nursing Association reviews quality metrics and nursing performance in all departments of the hospital to determine merit for the Magnet Award.
Baptist has achieved high marks for patient satisfaction.
Consumer Reports ranked Baptist highly for patient safety and quality. Consumer Reports rated Baptist Hospital the
safest hospital in Miami-Dade County.
Baptist assures that a high quality of care is maintained by implementing robust performance improvement plans. Baptist has a board-level quality committee that reviews outcome data on a bi-monthly basis.
Baptist also has a medical executive committee where performance improvement peer review results are presented on a monthly basis.
Baptist also has a number of collaborative teams over particular areas such as surgery, stroke, and tumors. These teams review outcomes in their particular areas and present them to the performance improvement steering council.
Baptist's performance improvement plan will be applied to a BMT program. There will be a BMT group to monitor outcomes in the same way as other groups.
Baptist has already developed extensive policies and procedures for its BMT program. These policies and procedures were developed by the recruited staff and will be reviewed for final approval by the BMT program’s new director, Dr. Gunther Koehne.
Baptist expects Dr. Koehne to implement standards of care consistent with MSK's in order for Baptist's patients to participate in MSK's clinical trials.
Baptist’s outpatient BMT unit is brand new and is equipped for patient needs. The outpatient and apheresis BMT units had already been constructed, equipped, and staffed by the time of the final hearing in this matter. Dr. Koehne testified that the facilities are both attractive and highly functional. Baptist has provided the space and equipment necessary to operate a BMT program.
Baptist's CON application included plans for the renovation of a portion of the hospital where inpatient BMT
patients will be served. The parties stipulated that the costs and methods of that construction were reasonable.
Baptist has an age-appropriate intensive critical care unit which includes facilities for prolonged reverse isolation.
Evidence was presented regarding the correlation of low volume BMT hospitals or doctors and their outcomes. The studies suggest that higher volumes and experience for physicians and their teams lead to better outcomes for patients.
However, Dr. Hugo Fernandez, the Chair of the Department of Malignant Hematology and Cellular Therapies at Moffitt, testified that a volume of 10 allogeneic transplants and
10 autologous transplants is above the volume at which research shows lower volumes may affect quality. Dr. Fernandez testified that Memorial West began safely performing allogeneic transplants one year after receiving its CON.
Dr. Claudio Anasetti, the Chair of the Blood and Marrow Transplantation Department at Moffitt, agreed that
20 transplants is a sufficient volume to ensure good outcomes.
The aforementioned findings, and those yet to be discussed, demonstrate that Baptist will be able to offer high quality care to patients of an adult inpatient BMT program.
Section 408.035(1)(d) – The Availability of Resources
Section 408.035(1)(d) pertains to a review of the applicant’s resources for project accomplishment and operation.
The statute expressly mentions “health personnel, management personnel, and funds for capital and operating expenditures.”
Findings regarding Baptist’s current ability to provide the health and management personnel necessary for autologous and allogeneic BMT will be discussed below in relation to Baptist’s ability to satisfy the criteria of
rule 59C-1.044 applicable to BMT centers. Baptist’s ability to fund the proposal will be discussed below in relation to the immediate and long-term financial feasibility of the proposal.
Section 408.035(1)(e) – The Extent to Which the Proposed Services Will Enhance Access to Health Care for Residents of the Service District
Baptist has a history of providing health care services to Medicaid and indigent/charity patients. Baptist Health System hospitals, including Baptist Hospital, provide
4.3 percent of its services to charity care patients, which is well above the average of 3.4 percent for hospitals in Miami- Dade County. Baptist Hospital also exceeds the county average.
As noted in a previous section, the access to care in District 11 is less than optimal given: (1) UM’s lack of inpatient charity care; (2) the fact that UM performs no
outpatient BMT; (3) the fact that Good Samaritan does not have a BMT program; and (4) the fact that a very high percentage of the outmigration cases are complex in nature, i.e., allogeneic and autologous with complications.
The greater weight of the evidence indicates that a BMT program at Baptist is likely to alleviate issues pertaining to access to care in the service district. However, given that Baptist will likely be a relatively small program for the foreseeable future, those issues will not be resolved in their entirety in the short-term.
Section 408.035(1)(f) – The Immediate and Long-Term Financial Feasibility of the Proposal
Section 408.035(1)(f) refers to “financial feasibility” rather than “profitability.”
The cost for Baptist's proposed BMT program is
$7,624,433, and the greater weight of the evidence demonstrates that Baptist will be able to finance the completion of the BMT program along with its other planned capital projects.
Baptist has a capital budget of $20,414,000 to finance routine items such as the replacement of outdated equipment and renovations of nursing units. This budget also covers additional clinical equipment that might be needed to begin a new service line.
Baptist identified other capital commitments that it had planned or were underway at the time of application. Along with the BMT program, Baptist’s other significant capital projects include construction of a new medical tower at a cost of
$125 million and relocation of a helipad at a cost of $5 million.
In total, Baptist disclosed $195.8 million in capital projects in its application.
Rather than using debt to finance the initiation of the BMT program, Baptist will use cash on hand. The application included a letter from BHSF's Chief Financial Officer committing to pay for the project’s start-up costs and to cover any operational losses that may be incurred as the BMT program ramps up:
BHSF intends to make available the required funds to Baptist Hospital of Miami, Inc. for the purpose of establishment of the project described in CON Application
No. 10490, through startup and project stabilization, including but not limited to the project costs identified on Schedule 1 of CON Application No. 10490. BHSF intends to fund this project from internal sources. BHSF’s ability to fund the project is documented in the attached BHSF audited financial statements.
Baptist provided audited financial statements which demonstrate the wherewithal to afford this project. BHSF’s net income for 2016 was $162,640,710. BHSF had $263 million in cash flow in 2016 and possesses over $2.4 billion in cash and investments.
While the audited financial statements state that the cash and other investments are “limited,” the explanatory notes to those statements state that “[a]ssets whose use is limited include assets set aside by the Board of Trustees for future
capital improvements and education, over which the Board retains control and may at its discretion subsequently use for other purposes . . . .” This supports Baptist’s assertion that the unrestricted cash and investments can be used for any purpose.
BHSF’s financial statements indicate that its current liabilities exceed its current assets by $100,470,725. While this is cause for concern, that is substantially ameliorated by the fact that BHSF’s total assets exceeded its total liabilities by $3,165,081,911 in 2016.
Even if BHSF’s application understated (or even omitted) some expenses associated with initiating the BMT unit, those expenses are insignificant for an entity with the financial resources available to Baptist through BHSF.
In short, the greater weight of the evidence demonstrates that Baptist can afford to initiate the proposed project and cover any operational losses during the first years of operation.
With regard to long-term financial feasibility, Baptist expects to get little or no revenue from allogeneic transplants in year one because it plans to perform 10 cases in order to become FACT accredited. None of the managed payors such as Medicare HMO and Medicaid HMO will pay until there is FACT accreditation.
Accordingly, the per case revenue is expected to be
$88,000 in year one, but that amount is expected to increase to
$175,000 in year two.
After accounting for anticipated expenses, Baptist forecasts a $2.9 million loss in year one of the application and a $577,000 loss in year two of the application.
During the final hearing, Baptist’s financial expert testified that the BMT program was projected to turn a small profit of $25,000 in year three of the application.
Given how substantially the net loss from the BMT program narrowed from year one to year two by adding only eight patients, it is reasonable to infer that the program will come close to breaking even by adding an additional 10 patients at some point after year two of the application.
Baptist’s projected expenses differ from its previous application because Baptist previously estimated both inpatient and outpatient revenues and expenses. The current application is for inpatient services only.
Outpatient BMT services have already been established at Baptist, and the expenses for those facilities and staff are considered sunk costs when compared to the project at issue, inpatient BMT services.
Those sunk costs include research facilities, staffing, nurses, and doctors, and they were appropriately
excluded from the pro forma financial statements associated with this application.
Existing hospital staff can absorb the additional demand for dietary and other services.
Even if it were to be assumed that this project will never be a positive contributor to Baptist’s net income, that would not be a basis, by itself, for finding that the BMT program is not financially feasible over the long-term. UM’s healthcare planning expert testified that BMT programs are not profit centers, but healthcare institutions operate such programs in order to fulfill a “mission” and to help people. That testimony was convincing and is accepted.
The evidence clearly and convincingly demonstrates that Baptist and BHSF are committed to having a BMT program. As noted above, Baptist considers a BMT program to be an integral component of its goal to have MCI be a full service cancer treatment center.
Baptist and BHSF’s commitment to the project is further demonstrated by the fact that MCI has already begun treating patients via an outpatient BMT program.
Baptist has incurred substantial expenses (such as construction and staffing) in preparing to have a BMT program at MCI.
In short, the preponderance of the evidence demonstrates that this project is financially feasible in the long-term. Even if it is not ultimately profitable, Baptist is committed to funding the program's losses, and Baptist demonstrated the ability to cover operational losses indefinitely.7/
Section 408.035(1)(g) – The Extent to Which the Proposal Will Foster Competition that Promotes Quality and Cost-Effectiveness
AHCA concluded in the SAAR that “[t]his project is not likely to have a material impact on competition to promote quality and cost-effectiveness.”
Nevertheless, the SAAR presented the following regarding the implications of UM’s PPS-exempt status:
In addition, the reviewer notes that the applicant will not be a PPS-exempt cancer hospital, as UMHC is designated, and therefore reimbursement to the two proposed Miami-Dade providers from
Medicare will be different. The reviewer notes that according to the U.S. Government Accountability Office (GAO), in 2012, Medicare payments received by the 11 PPS- exempt cancer hospitals were, on average,
42 percent more per discharge than what Medicare would have paid a local PPS teaching hospital to treat cancer beneficiaries with the same level of complexity. The GAO also found that the PPS-exempt cancer hospital’s payment methodology lacks strong incentives for cost containment and has the potential to result in substantially higher total Medicare expenditures. The GAO concludes that until Medicare pays PPS-exempt cancer
hospitals to encourage efficiency, Medicare remains at risk for overspending.
According to FloridaHealthFinder.gov, based on data submitted to the Agency through the inpatient database, UMHC had
160 bone marrow transplants with charges ranging from (on average) $403,740 (25th percentile) to $662,662 (75th percentile) with an ALOS of 25.0 days for CY 2016 for all adults 18+. The statewide total charges, for the same time period, ranged (on average) from $188,363 to $458,097 with an ALOS of 22.8 days.
While a BMT program at Baptist is unlikely to promote competition that will increase quality and cost-effectiveness, it appears that a BMT program at Baptist serving Medicare recipients would be less costly than the same service at UM, a PPS-exempt provider. However, given the relatively small size of the program at Baptist, it would probably be many years before any substantial savings could be achieved by shifting Medicare BMT patients from UM to Baptist.
Section 408.035(1)(h) – The Costs and Methods of the Proposed Construction
The parties stipulated that the costs and methods of construction were reasonable.
Section 408.035(1)(i) – Baptist’s Past and Proposed Provision of Health Care Services to Medicaid Patients and the Medically Indigent
As found above, Baptist Hospital has a significant record of providing more than the average level of service to Medicaid recipients and the indigent.
Rule Review Criteria
General Requirements for Organ Transplantation Programs
Rule 59C-1.044 is entitled “Organ Transplantation” and sets forth additional criteria by which AHCA reviews applications for organ transplantation programs such as a BMT program. Subsection (1) of the rule provides that “[a]pplicants for each type of transplantation program shall meet the requirements specified in subsections (3), (4) and (5).”
Rule 59C-1.044(3)(a) requires applicants to have staff and other resources necessary to care for the patient’s chronic illness before, during, and after transplantation. The rule also requires that “[s]ervices and facilities for inpatient and outpatient care shall be available on a 24-hour basis.”
Findings regarding Baptist’s physician staff are set forth below during the discussion of requirements pertaining specifically to allogeneic BMT programs.
Nevertheless, it is found here that Baptist can provide a comprehensive range of physician specialty support services on a 24-hour basis. These include (but are not limited
to) services such as intensive care physicians, cardiologists, infectious disease specialists familiar with the care of severely immune-compromised patients, and interventional radiologists.
Rule 59C-1.044(3)(c) requires a transplant services applicant to have “[a]n age-appropriate (adult or pediatric) intensive care unit which includes facilities for prolonged reverse isolation when required.”
Baptist’s application satisfies this requirement.
Baptist proposes utilizing its existing adult critical care resources when necessary for BMT patients. Baptist plans to transfer BMT patients from the six-bed adult BMT unit to the intensive care unit (“ICU”) when the ICU team determines the patient needs additional critical care support. Examples include patients who become hemodynamically unstable or those who need mechanical ventilation.
Baptist’s application notes that it is developing a “Protective Environment” room to support BMT patients who may require critical care services.
Rule 59C-1.044(3)(d) requires a transplant services applicant to have “[a] clinical review committee for evaluation and decision-making regarding the suitability of a transplant candidate.”
Baptist satisfies this requirement in that Baptist has specifically identified eight physicians to serve on its clinical
review committee and will place subsequently recruited BMT physicians on the committee. Baptist has also identified 17 other medical professionals (including many from the BMT Team Support staff) who will be placed on its clinical review committee.
Rule 59C-1.044(3)(e) requires an applicant to have:
[w]ritten protocols for patient care for each type of organ transplantation program including, at a minimum, patient selection criteria for patient management and evaluation during the pre-hospital, in- hospital, and immediate post-discharge phases of the program.
Rule 59C-1.044(3)(f) requires an applicant to have “[d]etailed therapeutic and evaluative procedures for the acute and long term management of each transplant program patient, including the management of commonly encountered complications.”
Baptist’s application states that:
[t]he protocols, policies, treatment plans and guidelines for selection, evaluation, treatment and management of the BMT patients are currently being finalized under the direction of the BMT Medical Director, Lyle Feinstein, MD. Drafts of these [] protocols, policies, treatment plans and guidelines are presented in Appendix 5.
The draft documents received in evidence and other information presented in Baptist’s application are sufficient to satisfy the required patient selection criteria established by rule.
As for the evaluative procedures, the application states “[w]ritten protocols/policies defining therapeutic and evaluative procedures for the acute and long term management of each BMT patient are being finalized for the Fall 2017 initiation of the outpatient BMT program and for the development of this proposed inpatient BMT program.” The application includes examples of those final drafts.
The draft documents received in evidence are sufficient to meet the required therapeutic and evaluative procedures established by rule.
Rules 59C-1.044(3)(h), (i), and (j) require an applicant to have: (a) an onsite tissue-typing laboratory or a contractual arrangement with an outside laboratory within Florida meeting the requirements of the American Society of
Histocompatibility; (b) pathology services; and (c) blood banking facilities.
In the current application, Baptist states that it has contracted with the Laboratory Corporation of America (“LabCorp”) for tissue typing services. The application includes a certificate from the American Society of Histocompatibility and Immunogenetics indicating that LabCorp is accredited in the area of “Histocompatibility Testing for Other Clinical Purposes.” The application also demonstrates that LabCorp is licensed to operate within the State of Florida.
The contract with LabCorp is sufficient to meet the criteria in rule 59C-1.044(3)(h).
As for pathology services, Baptist explains in its application that its laboratory department
has the technical resources and expertise necessary to fully support the proposed BMT program and provide the necessary information to best manage[] each BMT patient’s care. This in-house expertise and infrastructure, combined with the OneBlood and LabCorp external resources, will ensure that all BMT patients will have the required laboratory support to optimally meet their medical needs.
The application specifies that Baptist’s laboratory department can provide the following services: chemistry, coagulation, cytology, flow cytometry, hematology, histology, microbiology, phlebotomy, serology, transfusion service, and urinalysis. The aforementioned services are available 24 hours a day, seven days a week. In addition, laboratory tests can be completed in approximately one hour on a STAT basis.
The application states that the laboratory department has seven pathologists who are board certified in anatomic and clinical pathology and that those pathologists:
are eminently qualified and [] can diagnose the spectrum of complications that may occur in the immunocompromised bone marrow transplant patient population. They are able to diagnose the different pathogens that may effect this population.
Similarly, they are able to identify and
diagnose the histologic features of graft vs. host disease.
The record evidence is sufficient to meet the criteria for pathology services in rule 59C-1.044(3)(i).
The application also states that:
[t]he existing blood banking and transfusion facilities and services currently in existence at Baptist Hospital are appropriate for supporting the blood requirements associated with the proposed new BMT program. Combining these existing Hospital capacities with the support of OneBlood, acting as the area’s centralized blood collection, storage and distribution hub, all necessary blood banking services are available and supported. Further, with OneBlood providing the specialty
BMT blood/marrow processing and storage services, the blood and blood banking needs of the BMT patients will be fully met.
The application contains a June 6, 2017, letter from a OneBlood representative to Marisol Fitch of AHCA describing OneBlood’s capabilities and indicating OneBlood will be servicing Baptist’s BMT program.
The record evidence is sufficient to meet the criteria for blood banking facilities and services in rule 59C-1.044(3)(j).
Rule 59C-1.044(3)(k) calls for an applicant to have a “program for the education and training of staff regarding the special care of transplantation patients,” and Baptist’s current application demonstrates it has such a program.
Rule 59C-1.044(3)(l) refers to “[e]ducation programs for patients, their families and the patient’s primary care physician regarding after-care for transplantation patients.” UM does not challenge Baptist’s ability to satisfy this criterion.
Rules 59C-1.044(4)(a) and (b) set forth general requirements for the physician staff and the program director. These topics will be addressed in the discussion pertaining to the specific rule-based requirements for an adult allogeneic BMT program.
Rule 59C-1.044(4)(d) sets forth general requirements for nurses and nurse practitioners. This topic will be addressed in the discussion pertaining to the specific rule-based requirements for an adult allogeneic BMT program.
Rule 59C-1.044(4)(e) calls for an applicant to have “[c]ontractual agreements with consultants who have expertise in blood banking and are capable of meeting the unique needs of transplant patients on a long term basis.” Baptist’s current application demonstrates that OneBlood, as its provider of “specialty BMT blood/marrow processing and storage services,” meets the criteria established in that rule.
Rules 59C-1.044(4)(f), (g), and (h) call for an applicant to have appropriately trained nutritionists, respiratory therapists, social workers, psychologists, and psychiatrists.
Baptist has “clinical registered dieticians who are Certified Specialists in Oncology Nutrition, having the expertise of meeting the needs of patients with immunocompromised patients.” As for respiratory therapists, the application states that Baptist’s respiratory therapists “are experienced in providing respiratory support to BMT patients who develop pulmonary complications post-transplant such as pulmonary edema, bronchiolitis obliterans with organizing pneumonia and other complications seen post-transplant.” The application also states that Baptist’s respiratory therapists “will receive structured education about current standards of respiratory and pulmonary care for bone marrow patients by an expert in the field.”
As for the requirements pertaining to social workers, psychologists, and psychiatrists, Baptist’s application states that it has a full complement of such professionals and four social workers assigned to the inpatient oncology unit. Baptist plans to have social workers “specifically trained and assigned to support bone marrow transplant patients and families.” Those “BMT social workers will be knowledgeable in the spectrum of community services and assets available to support bone marrow transplant patients and their families throughout the full continuum of bone marrow care, including pre- and post-transplant care.”
Moreover, MCI is building a “Cancer Patient Support Center” that will be staffed by multidisciplinary teams of specialists and clinicians who will provide a wide array of support services such as Psycho-Oncology, Psychosocial Services, Integrative Medicine, Exercise Physiology, and Oncology Rehabilitation.
Baptist’s application and the evidence of record is sufficient to meet the criteria established in rules 59C- 1.044(4)(f), (g), and (h).
Rule 59C-1.044(5) pertains to data reporting requirements for facilities with organ transplant programs and is not at issue in this proceeding.
As discussed above and in subsequent findings set forth below, Baptist’s application satisfies the requirements set forth in rules 59C-1.044(3) and (4).
Requirements Specific to Bone Marrow Transplant Applicants
Rule 59C-1.044 sets forth requirements specific to bone marrow transplant applicants. For instance, subsection (1) states that a bone marrow transplant applicant must be a teaching or research hospital. See Fla. Admin. Code R. 59C-1.044(1) (mandating in pertinent part that “[t]he following organ transplantation programs shall be restricted to teaching or research hospitals: liver, adult allogeneic bone marrow,
pediatric allogeneic and autologous bone marrow ”).
See also Fla. Admin. Code R. 59C-1.044(9)(b)(mandating that “[a]dult allogeneic bone marrow transplantation programs shall be limited to teaching and research hospitals.”); Fla. Admin. Code R. 59C-1.044(9)(c)(providing that “[a]dult autologous bone marrow transplantation programs can be established at teaching hospitals or research hospitals; or at community hospitals having a research program, or who are affiliated with a research program, as defined in this rule.”).
Rule 59C-1.044(9)(b)9. pertains specifically to adult allogeneic BMT programs and requires an applicant to have “[a]n ongoing research program that is integrated either within the hospital or by written agreement with a bone marrow transplantation center operated by a teaching hospital. The program must include monitoring and long-term patient follow-up.”
Rule 59C-1.044(9)(b)10. requires “[a]n established research-oriented oncology program.”
The Research Criteria
Rule 59C-1.044(2)(d) defines a “research hospital” as “[a] hospital which devotes clearly defined space, staff, equipment, and other resources for research purposes, and has documented teaching affiliations with an accredited school of medicine in Florida or another state.”
Rule 59C-1.044(2)(d) defines a “research program” as “[a]n organized program that conducts clinical trial research, collects treatment data, assesses outcome data, and publishes statistical reports showing research activity and findings.”
The evidence presented at final hearing demonstrated that Baptist Hospital has a robust research program and a good research team.
Dr. Miguel Villalona-Calero was recognized as an expert in medical oncology and clinical and translational research.
Dr. Villalona-Calero has been involved with cancer research his entire career. Dr. Villalona-Calero has served as principal investigator on numerous clinical trials, including National Cancer Institute ("NCI") clinical trials.
In 1999, Dr. Villalona-Calero moved to Ohio State University where he became a full tenured professor and conducted many clinical trials with early therapeutics. By the time
Dr. Villalona-Calero left Ohio State, the research he was conducting had become nationally and internationally known.
Dr. Villalona-Calero has approximately 111 original publications resulting from his research.
Dr. Villalona-Calero has been involved in approximately 21 grants from NCI related to translational research work.
Dr. Villalona-Calero left Ohio State to join Baptist in September of 2015. Dr. Villalona-Calero was one of the first physicians Baptist recruited toward the goal of building the research component of Baptist's comprehensive cancer center.
Dr. Villalona-Calero leads Baptist's research program with Dr. Jeffrey Boyd, Dr. Minesha Mehta, and Dr. Michael Zinner. Among the other clinical trials personnel on the fourth floor of MCI are coordinators, research nurses, and data managers.
Dr. Villalona-Calero has recruited infusion nurses with the experience to respond to any emergencies that may occur during the clinical trials on the fourth floor.
In addition to Dr. Villalona-Calero, Dr. Zinner, Dr. Boyd and Dr. Minesh Mehta, there are other investigators at Baptist who conduct research, including a radiation oncologist and a neuro-oncologist. Baptist's application contained the
biographies of 13 additional investigators conducting research at Baptist.
Dr. Koehne will also conduct research at Baptist, similar to the research he conducted at MSK. Dr. Koehne is well recognized in the bone marrow transplant field, specifically in the area of T-cell immunology and T-cell immunotherapy.
The clinical trials office at Baptist is almost fully staffed. The only area for which Dr. Villalona-Calero is still recruiting is in the expanding area of early therapeutics.
Staffing is complete for clinical research services, regulatory quality assurance, clinical trials administration, and finance.
Dr. Villalona-Calero formed the clinical scientific review committee to review the scientific merit of all the cancer clinical trials to be performed at MCI.
The clinical scientific review committee works in conjunction with the Institutional Review Board ("IRB"). The IRB rules on ethical issues such as informed consent.
While the clinical scientific review committee is composed of MCI faculty, the IRB is an independent higher authority that must approve clinical trials before they may commence.
Since the 2015 CON application, Baptist has constructed MCI, and it includes a research wing. Baptist now has its clinical trials personnel on the fourth floor of the research wing. The new research wing also houses the Center for Genomic Medicine and a Phase One Therapeutics Unit.
Dr. Villalona-Calero designed the therapeutics unit that contains advanced cardiology equipment that permits printing of EKGs directly from the equipment. The unit also contains ten infusion areas, a centralized nursing station, and a centralized investigational pharmacy.
Adjacent to the unit are the facilities to house the clinical trials personnel.
Near the clinical trials personnel are a protocols support lab and a biorepository.
The fourth floor of the research wing also contains treatment rooms. These rooms have monitoring capabilities not available in normal hospital rooms. Because a patient's condition can change quickly and unexpectedly during clinical trials, these rooms are also designed so that emergency procedures can be activated more quickly than in a normal hospital room.
The fourth floor rooms are similar to ICU rooms. The clinical treatment rooms and their equipment are fully operational and open to patients.
Dr. Villalona-Calero and Dr. Boyd also have laboratories at Florida International University (“FIU”). The labs at FIU allow for trials not suitable in a hospital, such as trials involving animals. BHSF funded the labs at FIU.
Baptist has outcome monitoring and long-term patient follow-up as part of its research program.
Additionally, Baptist's Center for Genomic Medicine is conducting cutting edge research at Baptist.
Dr. Boyd was accepted as an expert in translational research and genomic medicine. Dr. Boyd is the Vice-President
for Translational Research and Genomic Medicine, as well as the Deputy Director at MCI.
Dr. Boyd is also employed by FIU as a tenured professor and chair of the Department of Human and Molecular Genetics, and associate dean for basic research and graduate programs. He has held both positions since July 2015.
As founding director of the Center for Genomic Medicine at MCI, Dr. Boyd has created three operation units within MCI. First is the division of clinical genetics, a group of medical professionals whose function is to counsel and advise appropriate genetic testing – and in some cases treatment – for individuals at substantially increased risk for inherited cancer susceptibility.
Second is a biobanking operation consisting of two discrete entities: the biospecimen repository facility ("BRF") and the protocol support lab ("PSL").
The BRF is charged with acquiring the consent of MCI patients for permission to bank excess tissue, blood and other fluids, annotate them, store them and ultimately distribute them for generic research purposes, as they may arise in the translational cancer research universe.
The PSL obtains these biospecimens, processes them, and distributes them to laboratories that may be conducting a test associated with the clinical trial.
Third is the molecular diagnostics laboratory ("MDL"), which is the clinical testing facility. The MDL performs targeted therapy, precision therapy, and precision medicine by obtaining DNA from patient tumors and manipulating that DNA with the goal of finding "druggable targets."
The MDL contains a research and development division that carries out translational cancer research, primarily genetic and genomic type research using existing technology, and research to develop new types of testing that may become appropriate as the field evolves.
The Center for Genomic Medicine at MCI conducts significant clinical research. This clinical research is specifically focused on cancer research.
Baptist and FIU share a very close and expanding relationship related to medical school research and clinical care. FIU's medical school has 480 students (120 students per class). Most of these students' clinical experience during their four-year education period takes place at Baptist. Baptist has funded research laboratories for numerous faculty on the college of medicine staff.
Baptist's research program has changed substantially since the 2015 CON application. For example, Baptist has ramped up its clinical trials program through its association with MSK, and the completion of the construction of the physical plant has
allowed the opening of the Center for Genomic Medicine, where the above mentioned genomic research takes place.
Baptist also conducts investigator-initiated trials that were not yet begun during the last CON application.
The Teaching Criteria
Rule 59C-1.044(2)(g) provides that a “teaching hospital” means “[a]ny hospital which meets the conditions specified in Section 408.07(45), F.S.” The statute defines teaching hospitals as hospitals that are officially affiliated with an accredited Florida medical school with at least seven accredited, graduate medical educational programs and the presence of at least 100 full time resident physicians.
Baptist does not offer seven accredited graduate medical educational programs to at least 100 residents, and therefore does not meet the definition of a teaching hospital as set forth in section 408.07.
However, Baptist engages in teaching activities.
BHSF coordinates all of the clinical rotations for FIU medical students across the Baptist Health system. There are approximately 500 students participating in rotations at BHSF.
Approximately 3,000 physicians are credentialed at BHSF. More than 500 of those physicians have faculty appointments at FIU. They serve as precepting physicians for the medical students who participate in clinical rotations.
Baptist offers training to first and second year medical school students, including rotations in emergency medicine. After moving into their third and fourth years, students move into their core elective rotations which occur across the entire BHSF system.
There are approximately two dozen elective rotations available to third and fourth year medical school students at Baptist, including general surgery and internal medicine.
There are approximately 500 medical students rotating in a typical year at Baptist.
Baptist provides accredited graduate medical education programs in family medicine, family sports medicine, and orthopedic sports medicine.
Baptist also offers fellowships in radiology and minimally invasive surgery.
Baptist offers a robust clinical training program in nursing and allied health. Baptist has between 3,500 and 4,000 nursing allied health students credentialed to rotate through all of BHSF.
Despite the fact that Baptist does not meet the technical requirements to be a teaching hospital, it does satisfy
the standards associated with a research hospital. Therefore, Baptist satisfies rules 59C-1.044(1) and (9).
Volume Requirements
When considered together, rules 59C-1.044(9)(b)1. and (c)1. require that an applicant for an adult autologous and allogeneic BMT program be able to project that at least
10 autologous and 10 allogeneic transplants will be performed each year.8/
As found in a previous section, a conservative estimate indicates that the number of BMT procedures should grow by at least five percent a year in TSA 4.
Given the forecasted growth in BMT and the fact that Baptist refers approximately 70 patients a year to other facilities for BMT treatment, Baptist should have no difficulty satisfying the volume requirement.
It is reasonable to expect that a substantial number of patients who begin their cancer treatment at Baptist will elect to stay with Baptist if their course of treatment leads to BMT.
The greater weight of the evidence demonstrates that Baptist satisfies the volume requirements.
Program Director Requirements
253. Rules 59C-1.044(9)(b)2. and (c)2. have virtually identical requirements for a program director.
Rule 59C-1.044(9)(b)2. requires an applicant to have
program director who is a board certified hematologist or oncologist with experience in the treatment and management of adult acute oncological cases involving high dose chemotherapy or high dose radiation therapy. The program director must have formal training in bone marrow transplantation.
Baptist has recruited Dr. Koehne to serve as the program director for its BMT program.
After obtaining his medical degree and PhD in Germany, Dr. Koehne worked at MSK. MSK is one of the leading institutions for cancer and bone marrow transplant in the world.
While at MSK, Dr. Koehne focused his research on post-transplant complications following allogeneic BMTs, including the reactivation of certain viruses. After undergoing clinical trials, a method developed by Dr. Koehne to treat such
viral reactivations became the nationally recognized standard for treatment and has been licensed by biopharmaceutical companies.
In addition to his appointment as a member at MSK, Dr. Koehne was a professor of medicine at Weill Cornell Medical College.
Prior to coming to MCI, Dr. Koehne was the medical director of the BMT laboratory and associate attending physician at MSK.
As medical director, Dr. Koehne oversaw the processing of bone marrow and gained familiarity with the equipment and processes for blood processing.
Dr. Koehne has done extensive work in the field of BMT research. Before leaving MSK, Dr. Koehne served as principal investigator of three clinical research trials and co-investigator on three or four more trials.
Dr. Koehne plans to continue these clinical trials at MCI, the results of some of which have already been published.
Dr. Koehne has personally performed many BMTs throughout his career. MSK Cancer Center does 450 transplants a year. Approximately 250 of those cases are autologous and the rest are allogeneic.
The greater weight of the evidence demonstrates that Baptist has satisfied the program director requirement.
Nursing Requirements
Rule 59C-1.044(4)(d) requires all transplant applicants to have a staff of nurses and nurse practitioners “with experience in the care of chronically ill patients and their families.” Rule 59C-1.044(9)(b)3., which specifically pertains to adult allogeneic BMT programs, requires an applicant
to have “[c]linical nurses with experience in the care of critically ill immune-suppressed patients. Nursing staff shall be dedicated full time to the program.”
UM does not contest the fact that Baptist has a nursing staff experienced in the care of chronically ill patients and their families.
As for the requirements of rule 59C-1.044(9)(b)3., Baptist has approximately 130 critical care, clinical nurses experienced in the care of critically ill immunosuppressed patients within the critical care unit. Baptist has a history of effectively staffing specialty areas that require specialty education. Baptist's ICU is also appropriately staffed. This nursing expertise will be available to the BMT program.
Baptist has developed a program for the education and training of staff regarding special care of BMT patients. Baptist included the 306-page plan in its CON application. This plan addresses the care requirements for providing bone marrow transplant care.
The greater weight of the evidence demonstrates that Baptist satisfies the nursing requirements.
Interdisciplinary Transplant Team
Rule 59C-1.044(4)(a) pertains to all transplant applicants and requires them to have a “staff of physicians with expertise in caring for patients with end-stage disease
requiring transplantation.” Furthermore, that staff “shall have medical specialties or sub-specialties appropriate for the type of transplantation program to be established.”
Rule 59C-1.044(9)(b)4. applies specifically to adult allogeneic BMT programs and requires an applicant to have:
[a]n interdisciplinary transplantation team with expertise in hematology, oncology, immunologic diseases, neoplastic diseases, including hematopoetic and lymphopoietic malignancies, and non-neoplastic disorders. The team shall direct permanent follow-up care of the bone marrow transplantation patients, including the maintenance of immunosuppressive therapy and treatment of complications.
Baptist has substantially augmented its existing physician staff through the hiring of Dr. Koehne.
Baptist will also rely on Dr. Feinstein to provide BMT services. Dr. Feinstein has experience starting a new BMT program and in achieving FACT accreditation. Dr. Feinstein has experience with both autologous and allogeneic transplantations. Dr. Feinstein has a strong background in BMT.
MCI was also successful in recruiting Dr. Paba-Prada, who is experienced in autologous transplantation and treating patients with myeloma and lymphoma from Dana-Farber Cancer Center.
Baptist’s application states the following regarding its physician staffing:
Essential to the success of the proposed BMT program is the experienced team of 27 board certified hematologists
and oncologists currently on staff at the Hospital, with three of these physicians currently trained and experienced to care for the adult BMT patients. With this large group of hematologists and oncologists currently on staff, providing patient care in the inpatient and outpatient settings, these physicians create a strong and experienced
medical team to support the existing
9 multidisciplinary tumor site teams, including a team for Hematological Malignancies and BMT.
To whatever extent that Baptist needs to recruit additional physicians in order to satisfy the rule-based requirements, it is noted that the program will not heavily taxed at the outset. There will probably never be more than two to three patients in the BMT unit at any one time during the first two years of operation.
The greater weight of the evidence demonstrates that Baptist satisfies the physician staffing requirements.
Laboratory Requirements
Rule 59C-1.044(9)(b)7. calls for an applicant to
have:
[a] laboratory equipped to handle studies including the use of monoclonal antibodies, if this procedure is employed by the hospital, or T-cell depletion, separation of lymphocyte and hematological cell subpopulations and their removal for prevention of graft versus host disease.
This requirement may be met through contractual arrangements.
Rule 59C-1.044(9)(b)8. calls for an applicant to have “[a]n onsite laboratory equipped for the evaluation and cryopreservation of bone marrow.
Baptist proposed to contract with OneBlood for laboratory services required to offer BMT. The application also indicated that Baptist would establish an onsite lab if required by AHCA. When AHCA approved Baptist's application, the approval was conditioned upon the establishment of an onsite laboratory for cryopreservation at Baptist. Since that requirement was announced, Baptist identified space, budgeted, and has now equipped a cryopreservation lab at the hospital.
OneBlood offers services used in BMT at hospitals.
OneBlood provides processing for allogeneic and autologous transplants. OneBlood provides blood processing services for other BMT programs in Florida. OneBlood provides services for both Miami Children's Hospital's BMT program and Memorial West's BMT program. Neither hospital has its own cryopreservation lab.
OneBlood provides all processing required of – and has all the equipment needed for – an autologous BMT procedure including cryopreservation. OneBlood also provides all the processing required for an allogeneic BMT procedure.
OneBlood has agreed to provide the processing required for Baptist's BMT program, as it does for Miami Children's Hospital and Memorial West. OneBlood offers cryopreservation and storage, thawing of stem cell collections, and CD 34 cell counts.
OneBlood will offer T-Cell subset characterization (also referred to as "T-cell depletion") in 2018. To begin offering T-cell depletion, OneBlood only needs to acquire a cell separator. The cell separator is an automatic machine. OneBlood will have little difficulty gaining the additional accreditation to perform T-cell depletion because performing T-cell depletion only requires the acquisition of the cell separator.
The OneBlood contract accommodates requests for services after hours and on weekends because OneBlood is available on call if products arrive during off hours.
UM has used OneBlood for stem cell processing in the past. UM has successfully transferred blood product from OneBlood to UM for use in transplantation. UM has also successfully shipped blood products that were harvested at UM from UM to OneBlood. UM has successfully transferred blood product to OneBlood for use in a transplantation in Broward County.
The greater weight of the evidence demonstrates that Baptist satisfies the laboratory requirements.
Other Criteria
Baptist satisfies the requirements in rules 59C- 1.044(9)(b)5. and 6. pertaining to inpatient transplantation units and a radiation therapy division.
Rule 59C-1.044(9)(b)11. calls for an applicant to have a “patient convalescent facility to provide a temporary residence setting for transplant patients during the prolonged convalescence.”
Baptist’s application notes that it “works cooperatively with a number of local hotels to ensure that patients and their families have accessible housing resources during extended hospital stays or extended recuperative stays."
Baptist also has several apartments that can be used by patients, caregivers and/or family members.
The application states that Baptist is in the process of constructing a new hotel facility that will be located on the northwest corner of the Baptist Hospital campus. This hotel will have 184 rooms and will house BMT patients and their families during post-transplant monitoring and evaluation.
Rule 59C-1.044(9)(b)12. calls for an applicant to have an “outpatient unit for close supervision of discharged patients.”
The application states that Baptist anticipated completing an outpatient unit on the third floor of MCI by the Fall of 2017.
The greater weight of the evidence demonstrates that Baptist satisfies standards for convalescent housing and outpatient facilities.
Not Normal Circumstances
A prospective provider of a tertiary health service such as BMT can apply by satisfying all of the statutory and rule requirements or by demonstrating that not-normal circumstances exist.
Ms. Fitch, the CON and commercial managed care unit manager for AHCA, explained the not-normal circumstances AHCA relied on to preliminarily approve Baptist’s CON:
Q: What abnormal circumstances were presented within this application?
A: Well, there were a couple of them. There was the utilization of the existing programs. Essentially the – there are three programs in OTSA 4. The first one, Good Sam, is essentially defunct.
We had condition compliance reports; we noted it in the SAAR, that, through condition compliance reports, we found out that what Good Sam had been reporting were biopsies, because they reported zero inpatient or outpatient bone marrow transplants in calendar year 2016. So that program is essentially defunct.
We also had Memorial West, which is significantly underutilized and not producing enough bone marrow transplants to be considered much of a viable program in the latter half of 2015 and certainly in 2016.
We also have the overutilization of the one program at University of Miami Hospital and Clinics. They applied for a 12-bed unit. They advertised on their website for a 12-bed unit. They’re obviously doing more than what an average daily census of
12 beds would be.
So that program seemed to be overutilized. So the utilization patterns that we were seeing [were] one not-normal circumstance for the population.
Another not-normal circumstance is the charity care or lack of charity care within this OTSA 4, not seeing that charity care is being provided by the existing program, and so there [are] questions as to financial accessibility to the residents of OTSA 4.
In addition to that, looking at the cost- effectiveness criteria under 408.035, looking at the data that is at Florida Health Line for charges amongst the – statewide for the exact same procedure, and then looking at the charges at University of Miami Hospital and Clinics, the charges at University of Miami Hospital and Clinics are significantly higher than the charges for the statewide average.
And by “significantly higher,” it’s approximately $200,000 plus, both in the charges low category, which is the 25th quartile; and in the charges high category, which is the 75 quartile. So that cost- effectiveness issue is concerning.
In addition to that, on the cost- effectiveness, University of Miami pointed
out in their opposition statement that they are a PPS-exempt facility. And kind of exploring what that means, they’re one of only 11 PPS-exempt facilities in the nation, and how they get reimbursed by Medicare – of course Medicare is the bar in which all rates are set – and so how that affects cost-effectiveness within the OTSA
3 – 4, sorry.
Q: Were previous programs approved by the agency applying this rule under not normally approved?
A: Yes. The last two bone marrow transplant programs in OTSA 4 that were approved, both the University of Miami Hospital and Clinics and Memorial West, were approved under not-normal circumstances, because they did not meet all the rule criteria; specifically, both of those facilities were not statutory teaching hospitals.
The fact that Good Samaritan does not have a BMT program, despite the previous reports to AHCA that it performed
42 BMTs in 2016, by itself, is significant enough to justify Baptist not strictly complying with the requirements of rules 59C-1.044(9)(b) and (c).
The greater weight of the evidence demonstrates that not-normal circumstances are present in TSA 4.
Adverse Impact
If the CON at issue is granted, there is no persuasive evidence demonstrating that UM’s ability to conduct research or to maintain the proficiency of its physicians will be adversely impacted.
However, it is very likely that patients who would have received their BMT treatment at UM will instead receive that treatment at Baptist. While the greater weight of the evidence demonstrates that UM should not experience any meaningful decline in volume, UM is very likely to be adversely impacted by the fact that its patient volumes (and the resulting increase in revenues) will not be growing as quickly if the CON at issue were not granted.
As Baptist moves to recruit additional staff with experience with BMT and/or allogeneic procedures, it is possible that Baptist may hire UM employees.
In sum, the greater weight of the evidence demonstrates that UM will be adversely impacted to a minor degree if the CON at issue is granted.
Changed Circumstances
To the extent the outcome of DOAH Case No. 16-1698CON is determined to have any relevance in this de novo proceeding, the evidence establishes that conditions have sufficiently changed such that conclusions regarding issuance of a CON to Baptist for an adult autologous and allogeneic BMT program in TSA 4 in DOAH Case No. 16-1698CON have no applicability to the new application at issue herein. Such changed circumstances include, but are not limited to, the following.
Ms. Fitch testified that it was unknown during the prior proceeding that Good Samaritan was a defunct program.
Multiple findings in ALJ Peterson’s Recommended Order corroborate Ms. Fitch’s testimony.
The alliance between Baptist and MSK is another changed circumstance.
Mr. Richardson described the significance of that alliance as follows:
The Memorial Sloan Kettering alliance linkage is just not marketing and branding and saying you are a part of us. It actually appears to be a much stronger integrated linkage between Memorial Sloan Kettering and the Baptist Hospital Miami Cancer Institute operation. Basically the last go around, Baptist was in a six- to nine-month evaluation process, where they were providing policies, procedures, outcomes, just a huge amount of information to Sloan Kettering to basically see whether they would be accepted as part of the alliance. That all went through, and now as described here, it’s a real linkage; they basically, in terms of the – you have linkage between the clinical side and you have linkage between the research sides.
So you have the ability for Baptist to tap into the expertise that is available at Sloan Kettering. So it’s not just a marketing name, Baptist Hospital linked with somebody else. It’s a true integrated operational linkage.
Another changed circumstance is that MCI is now operational, and Baptist is performing outpatient autologous
procedures. At the time of the 2015 CON application, MCI was aspirational and was being constructed.
The current Baptist application is substantially better than the prior one. Baptist has gone to great lengths to improve its research capacity, and all of the available evidence indicates that Dr. Koehne is exceptionally well-qualified to be Baptist’s program director.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings. §§ 120.569, 120.57(1), and 408.039(5), Fla. Stat.
Standing
In CON proceedings, an existing facility or program must demonstrate that it will be "substantially affected" by approval of the CON aapplication at issue. § 408.039(5)(b), Fla. Stat. As the challenger, UM bears this burden. See Balino v.
Dep't of HRS, 348 So. 2d 349 (Fla. 1st DCA 1977). If a hospital
seeks to prevent a competing hospital from offering a CON- regulated service, the challenger must show: (1) an injury-in- fact of sufficient immediacy, and (2) that the person's substantial injury is of a type and nature that the proceeding was designed to protect. Agrico Chem. Co. v. Dep't of Envt'l
Reg., 406 So. 2d 478 (Fla. 2d DCA 1981). The burden of proof is
a preponderance of the evidence. § 120.57(1), Fla. Stat.
In the instant case, UM has demonstrated that it has standing to challenge Baptist’s application. As found above, UM will be adversely impacted by the fact that its patient volumes and revenues are unlikely to be growing as quickly if the CON at issue is granted.
As Baptist moves to recruit additional staff with experience with BMT and/or allogeneic procedures, it is possible that Baptist may hire UM employees.
The Applicant’s Burden of Proof
The petition in this case commenced a de novo proceeding intended to formulate final agency action, "not to review action taken earlier and preliminarily." Fla. Dep't of
Transp. v. J.W.C. Co., 396 So. 2d 778, 786-87 (Fla. 1st DCA
1981). AHCA's preliminary decision is not entitled to a presumption of correctness. Id. As the applicant, Baptist bears
the burden of proving that its CON application should be approved. Boca Raton Artificial Kidney Ctr. v. Dep't of HRS,
475 So. 2d 260 (Fla. 1st DCA 1985).
In addition, the award of a CON must be based upon a balanced consideration of applicable statutory and rule review criteria. Dep't of HRS v. Johnson & Johnson Home Healthcare,
Inc., 447 So. 2d 361 (Fla. 1st DCA 1984); Balsam v. Dep't of HRS,
486 So. 2d 1186 (Fla. 1st DCA 1988).
The weight to be given to each criterion is not fixed; it varies depending on the facts in each case. Collier Med. Ctr., Inc. v. Dep't of HRS, 462 So. 2d 83 (Fla. 1st DCA
1985).
Baptist bears the burden to prove its entitlement to the CON it seeks by a preponderance of evidence. See Boca
Raton Artificial Kidney Ctr., Inc., 475 So. 2d at 263;
§ 120.57(1)(j), Fla. Stat.
Balanced Review of the Statutory and Rule Criteria
The preponderance of the evidence demonstrates that Baptist satisfies the statutory review criteria in section 408.035(1).9/
The preponderance of the evidence also demonstrates that Baptist satisfies the criteria in rules 59C-1.044(3)
and (4) that pertain to all transplant programs.
The preponderance of the evidence demonstrates that Baptist complies, substantially complies, or will comply with the criteria in rules 59C-1.044(9)(b) and (c) that apply exclusively to adult allogeneic and autologous BMT programs.
Even if an applicant does not strictly comply with the criteria in rules 59C-1.044(9)(b) and (c), the plain language of those rules states that an application can still be
approved if not-normal circumstances are present. Fla. Admin. Code R. 59C-1.044(9)(b)(providing that “[i]n addition to meeting the requirements in subsections (3), (4) and (5), applications for new bone marrow programs shall not normally be approved unless the following additional requirements and criteria are met.”).
Given the not-normal circumstances discussed above and the fact that Baptist complies, substantially complies, or will comply with all of the rule-based criteria, a balanced consideration of applicable statutory and rule review criteria leads to a conclusion that the CON should be granted.
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 approving the Certificate of Need Application No. 10490 submitted by Baptist Hospital of Miami, Inc. to establish a new adult autologous and allogeneic bone marrow transplant program in Florida’s Organ Transplant Service Area 4.
DONE AND ENTERED this 15th day of August, 2018, in Tallahassee, Leon County, Florida.
S
G. W. CHISENHALL Administrative Law Judge
Division of Administrative Hearings The DeSoto Building
1230 Apalachee Parkway
Tallahassee, Florida 32399-3060
(850) 488-9675
Fax Filing (850) 921-6847 www.doah.state.fl.us
Filed with the Clerk of the Division of Administrative Hearings this 15th day of August, 2018.
ENDNOTES
1/ Unless stated otherwise, all statutory references will be to the 2018 version of the Florida Statutes. See Lavernia v. Dep’t of Bus. & Prof’l Reg., Bd. of Med., 616 So. 2d 53 (Fla. 1st DCA 1993)(noting that “Florida follows the general rule that a change in a licensure statute that occurs during the pendency of an application for licensure is operative as to the application, so that the law as changed, rather than as it existed at the time the application was filed, determines whether the license should be granted.”).
2/ Baptist Hospital was founded in 1960 as a 100 bed facility. The hospital has grown into a large tertiary hospital, with
728 beds, more than 100,000 emergency room visits annually, and a staff of over 4,000 full time employees.
3/ Mark Richardson, Baptist’s health planning expert, testified that Baptist is the proper applicant for the CON at issue because it is “the host organization for all the inpatient care that would be provided in this program. And it’s the host organization for the majority of the wraparound ancillary services that will be provided for patients as well. So I believe from a planning perspective that, yes, that is the appropriate entity to be the applicant.”
UM argued in its Proposed Recommended Order that MCI should have been the applicant or a co-applicant for the CON at issue because the application relies heavily on MCI’s resources or capabilities. However, without citing any legal authority indicating that Baptist’s application was fatally deficient due to this alleged omission, UM’s argument is unpersuasive.
4/ With regard to statistics on the number of BMT procedures performed, the undersigned will rely as much as possible on AHCA’s discharge database. Information from AHCA’s discharge database is more reliable than self-reported information to local health councils because the AHCA information must be certified by hospital executives.
5/ In addition to UM, there are two other providers of BMT services in Miami-Dade County, Jackson Memorial Hospital and Nicklaus Children’s Hospital. While Jackson Memorial Hospital and Nicklaus Children’s Hospital are only approved for pediatric BMT, they have developed a regular pattern of seeking variances from AHCA so that they can treat existing patients who began treatment as children but became adults during the course of treatment. In 2016, Jackson Memorial Hospital performed 24 BMTs on patients over 15, and Nicklaus Children’s Hospital performed
13 such cases. Because Jackson Memorial Hospital and Nicklaus Children’s Hospital normally treat children, the undersigned has elected not to consider their reported BMT procedures in assessing the need for adult BMT in the relevant geographic area.
6/ Because AHCA denied Baptist’s prior application via a
Final Order issued on June 13, 2017, UM argued that the current application should be summarily denied due to administrative finality, collateral estoppel, and/or res judicata. However, circumstances have substantially changed since denial of Baptist’s prior application. The most significant change is the acceptance by all parties that Good Samaritan was not performing BMTs when ALJ Peterson made his findings in DOAH Case No. 16-1698CON. A close examination of ALJ Peterson’s Recommended Order reveals that several of his key findings were influenced by an erroneous understanding that Good Samaritan was performing BMTs. As a result, ALJ Peterson’s Recommended Order and the resulting Final Order from AHCA are of interest in this proceeding, but they are not controlling. See Delray Med. Ctr. v. Ag. for Health Care Admin., 5 So. 3d 26, 29 (Fla. 4th DCA 2009)(noting that “Florida courts do not apply the doctrine of
administrative finality when there has been a significant change of circumstances or there is a demonstrated public interest” and
holding “competent and substantial evidence at the administrative hearing supported the administrative law judge’s conclusion that there had been substantial changes in material circumstances between the two applications.”).
Furthermore, it is well-established that "[a] request for a formal administrative hearing commences a de novo proceeding intended to formulate agency action, and not to review action taken earlier or preliminarily." Beverly Enters. Fla., Inc. v. Dep’t of HRS, 573 So. 2d 19, 23 (Fla. 1st DCA 1990); see also Young v. Dep’t of Cmty. Affairs, 625 So. 2d 831, 833 (Fla.
1993)(noting that "a chapter 120 proceeding is a hearing de novo intended 'to formulate final agency action, not to review action taken earlier and preliminarily.'"); and Boca Raton Artificial Kidney Ctr., Inc. v. Dep’t of HRS, 475 So. 2d 260,
262 (Fla. 1st DCA 1985)(stating that “[s]uch policy also fails to recognize the proper role of [s]ection 120.57 hearings in the administrative process, i.e., such hearings are to aid in the formulation of final agency action and are not intended solely for review of action taken earlier and preliminarily.").
7/ In North Broward Hospital District, d/b/a Broward Health Medical Center v. South Broward Hospital District, d/b/a Memorial Regional Hospital and Agency for Health Care Administration, Case Nos. 15-5549CON & 15-5550CON (Fla.
DOAH May 4, 2016; AHCA June 1, 2016), ALJ W. David Watkins found that “[i]n this case, long-term financial feasibility is not accorded as much weight as it might be in other CON determinations, because there is an established need for these tertiary services, and both applicant organizations have the ability, if they so choose, to subsidize operational losses in order to maintain the programs. Stated differently, the projected long-term financial feasibility of both applicants’ proposals is not a basis for distinguishing between them.
Rather, the commitment of the applicants to their proposals as addressed above, is the more critical consideration.” (emphasis added).
8/ Rule 59C-1.044(9)(b) pertains to adult allogeneic BMT programs, and rule 59C-1044(9)(c) pertains to adult autogenic BMT programs. Baptist is applying for a CON to conduct adult autologous and adult allogeneic BMT. Because an applicant that satisfies the requirements for adult allogeneic BMT programs would almost certainly satisfy the requirements for adult autologous BMT, the remainder of the analysis will predominantly focus on the allogeneic requirements.
9/ Also, to whatever extent that UM argues that Baptist improperly amended its application, the undersigned concludes that none of the alleged amendments satisfied the test for an impermissible amendment. See e.g. Manor Care, Inc., and Health Quest Corp. v. Dep't. of HRS, 558 So. 2d 26 (Fla. 1st DCA 1989) (finding an impermissible, substantial change when an applicant for community nursing home beds "updated" its application to present a different facility design, sought to increase the facility's square footage, and altered its Medicaid commitment, seemingly to overcome criticism from the Agency).
COPIES FURNISHED:
Richard Joseph Saliba, Esquire
Agency for Health Care Administration Fort Knox Building III, Mail Stop 7 2727 Mahan Drive
Tallahassee, Florida 32308 (eServed)
S. Chris Ciocco
Baptist Hospital of Miami, Inc. 6855 Red Road
Coral Gables, Florida 33143
Frank P. Rainer, Esquire Broad and Cassel
Suite 400
215 South Monroe Street Tallahassee, Florida 32301 (eServed)
M. Stephen Turner, Esquire Broad and Cassel
Suite 400
215 South Monroe Street Tallahassee, Florida 32301 (eServed)
Leonard M. Collins, Esquire Broad and Cassel
Suite 400
215 South Monroe Street Tallahassee, Florida 32301 (eServed)
Kevin Michael Marker, Esquire
Agency for Health Care Administration Mail Stop 7
2727 Mahan Drive
Tallahassee, Florida 32308 (eServed)
Lindsey L. Miller-Hailey, Esquire Agency for Health Care Administration Mail Stop 7
2727 Mahan Drive
Tallahassee, Florida 32308 (eServed)
Sean M. Frazier, Esquire
Parker Hudson Rainer & Dobbs, LLP Suite 750
215 South Monroe Street Tallahassee, Florida 32301 (eServed)
Marc Ito, Esquire
Parker Hudson Rainer & Dobbs, LLP Suite 750
215 South Monroe Street Tallahassee, Florida 32301 (eServed)
Jonathan L. Rue, Esquire Parker, Hudson, Rainer
and Dobbs, LLC Suite 3600
303 Peachtree Street Northeast Atlanta, Georgia 30308 (eServed)
Leonard M. Collins, Esquire Broad and Cassel
Suite 400
215 South Monroe Street Tallahassee, Florida 32301 (eServed)
Richard J. Shoop, Agency Clerk
Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3
Tallahassee, Florida 32308 (eServed)
Justin Senior, Secretary
Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 1
Tallahassee, Florida 32308 (eServed)
Stefan Grow, General Counsel
Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3
Tallahassee, Florida 32308 (eServed)
Shena Grantham, Esquire
Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3
Tallahassee, Florida 32308 (eServed)
Thomas M. Hoeler, Esquire
Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3
Tallahassee, Florida 32308 (eServed)
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 |
|---|---|---|
| Oct. 03, 2018 | Agency Final Order | |
| Aug. 15, 2018 | Recommended Order | Respondents demonstrated that not normal circumstances justified granting the application for a bone marrow transplant program. |
