STATE OF FLORIDA AGENCY FOR HEALTH CARE hamster 2 29 HEALTH CENTER OF NAPLES, INC., d/b/a THE ARISTOCRAT, et al., Petitioner, vs. AGENCY FOR HEALTH CARE ADMINISTRATION Respondent. bere} i - DOAH Case Nos. 01-1149, 01-1601 01-1654, 01-1655 01-1656 RENDITION NO. AHCA-01-156~S-MDR FINAL ORDER This cause came before me for the purpose of issuing a final-agency order, it appearing from the Settlement Agreement and Order Closing File, attached and incorporated herein, that there are no remaining disputed issues of fact or law. FINDINGS OF FACT 1. On June 11, 2001, a Settlement Agreement between the parties was 2.‘ There are no remaining disputed i issues of fact or law. The Division’s case file on this matter was closed by order dated June 18, 2001. - titioners case against the Agency. On June 12, 2001, a jon of A Administrative Hearings. _ CONCLUSIONS OF LAW "The Agency has jurisdiction over ‘the parties and subject matter pursuant to Section 120. 57, Fla, Stat. 2000) The parties are directed to comply with the terms of the Settlement and Dismissal. The petition is dismissed and the file is closed this 27th day of June, 2001. a Popes Laura Branker Acting Secretary Agency for Health Care Administration A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO A JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK, AND A SECOND COPY ALONG WITH FILING FEE AS PRESCRIBED BY LAW WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW OF PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF THE RENDITION OF THE ORDER TO BE REVIEWED. Copies Furnished to: Lawrence P. Stevenson John Owens Administrative Law Judgi ; Program Analysis DOAH - AHCA, Bldg. #3 1230 Apalachee Parkway 2727 Mahan Drive Tallahassee, FL 32399-3060 Tallahassee, FL 32308 ~. Steven Grigas, Esquire AHCA, Bldg. #3 «2727 Mahan Drive oa. — : “Pallahassee, FL 32308" SAStcha basta Migs ikl, Vat utenti an + Aaa SEES E Le Michael Bittman, Esquire Gray, Harris & Robinson, P.A. 301 East Pine Street, Suite 1400 © PO Box 3068 Orlando, FL 32801 CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing has been ‘? furnished to the above named addressees by U.S. Mail on this the way day of And _, 2001. RS. sd Agency Clerk State of Florida STATE OF FLORIDA DIVISION OF ADMINISTRATIVE HEARINGS THE HEALTH CENTER OF NAPLES, INC., d/b/a THE ARISTOCRAT, Petitioner, vs. CASE NO. 01-1149 AGENCY FOR HEALTH CARE ADMINISTRATION, Respondent. / THE HEALTH CENTER OF HUDSON, INC., d/b/a BAYONET POINT HEALTH & REHABILITATION CENTER, Petitioner, vs. CASE NO. 01-1601 AGENCY FOR HEALTH CARE ADMINISTRATION, Respondent. . / THE HEALTH CENTER OF LAKE CITY, INC., d/b/a HEALTH CENTER OF LAKE CITY, ease ‘Petitioner, vs. CASE NO. 01-1654 AGENCY FOR HEALTH CARE ADMINISTRATION, . Respondent. ~ ; / THE HEALTH CENTER OF PLANT CITY, INC., d/b/a THE HEALTH CENTER OF PLANT CITY, Petitioner, vs. CASE NO. 01-1655 AGENCY FOR HEALTH CARE ADMINISTRATION, Respondent. THE HEALTH CENTER OF PORT CHARLOTTE, INC., d/b/a CHARLOTTE HARBOR HEALTHCARE, Petitioner, vs. CASE NO. 01-1656 AGENCY FOR HEALTH CARE ADMINISTRATION, Respondent. / SETTLEMENT AGREEMENT “This settlement agreement is entered ‘into by and between ‘the Agency for Health Care Administration (CAHCA”), Petitioners, and Steven A. Strawn. 1. By change of ownership ("CHOW") effective on October 1, 2000, Petitioners became the . new license holders for five leased skilled nursing facilities involved in these cases. Atall | ! times material to this proceeding the five facilities were certified for and did participate in the F lorida Medicaid: program. ! : : =: . AHCA is an executive agency of the State of Florida designated by law as the single state agency responsible for administering the Florida Medicaid program, including the establishment of reimbursement rates for skilled nursing facilities. . Under Medicaid, skilled nursing facilities, such as those involved in this proceeding, are reimbursed for their services to eligible recipients pursuant to the Florida Title XIX Long-Term Care Reimbursement Pian (“Plan”), which has been incorporated by reference as arule. See Fla. Admin. Code R. 59G-6.010. . Incomputing the reimbursement rates, AHCA determined that Petitioners were a "related party" to the prior operator of the centers and denied a rate increase due to the CHOW. Under the Plan, skilled nursing facilities may be entitled to an increase in their per diem rates when a CHOW occurs. AHCA\'s decision to deny Petitioners’ rate increases, dated January 24, 2001, March 8, 2001, March 19, 2001, and March 27, 2001, statalin part “The reimbursement rate for your facility will be based on the existing rate in effect for the previous related party owner/operator..." . Petitioners filed petitions challenging AHCA’s determinations of "related party" status and computation of reimbursement rates for the five facilities. Petitioners contend they are unrelated to the prior operators of the facilities and should receive higher reimbursement rates in accordance with the Plan. | | . The parties have conducted extensive discovery and trial preparation. The parties have also ‘entered into settlement negotiations and, as a result of those negotiations, the parties desire to : resolve these consolidated cases without further litigation and expense pursuant to the following terms and conditions. . Asa part of the aforementioned negotiations, discovery, and trial preparation, the Petitioner advised AHCA by letter dated J une 1, 2001, attached and incorporated herein by reference as composite exhibit A, that the rate increase will be used to continue staffing and quality of care above the required State minimums. Due to significant increases in the State minimum staffing requirements beginning January 1, 2002, Petitioners and the similarly situated facilities will at least meet the requirements, and may exceed the requirements if necessary to meet the needs of the residents. . In consideration of the foregoing and for other good and valuable consideration, AHCA, Petitioners and Steven A. Strawn agree as follows: a) For the five facilities at issue in these cases, Petitioners represent and warrant that all outstanding debt owed by Petitioners to National Healthcare Corp. (“NHC”), other than obligations under the various operating and furniture, fixtures and equipment leases, has been satisfied. As evidence of the satisfaction of Petitioners’ debts to NHC, Petitioners have attached to this agreement true and correct copies of the following: i. May 2001 letters from NHC to Petitioners confirming satisfaction of the “outstanding debts (composite exhibit B); ii. Petitioners’ adjustment promissory notes marked “paid in full” by NHC (composite exhibit C); and iti. Schedules showing dates and amounts paid by Petitioners to NHC with the resulting zero balances (composite exhibit D). b) Pursuant to AHCA’s request, Petitioners have agreed to cancel their working capital notes and personal guarantees with NHC, even though no borrowings under the notes 4 ke have occurred. Attached as composite exhibit E are letters ‘from NHC confiming cancellation of Petitioners’ working capital notes and personal guarantees. c) The parties recognize that there are seven similarly situated facilities leased by corporations related to Petitioners, namely The Health Center of Imperial, Inc. (DOAH Case No. 01-1922); The Health Center of Coconut Creek, Inc. (DOAH Case No. 01- 1923); The Health Center of Merritt Island, Inc. (DOAH Case No. 01-1931 ); The Health Center of Daytona Beach, Inc. (no DOAH case pending as yet); The Health Center of Orlando, Inc. (no DOAH case pending as yet); The Health Center of Pensacola, Inc. (no DOAH case pending as yet); and The Health Center of Stuart, Inc. (no DOAH case pending as yet). Steven A. Strawn, the sole director of the above-referenced corporations, agrees that all outstanding debt owed by the seven similarly situated facilities to NHC, other than the leases, will be satisfied no later than June 15, 2001, and that documentation similar to that specified in {J 8a and b above will be submitted to AHCA for each of the seven similarly situated facilities by that date. d) AHCA agrees to recompute the reimbursement rates of Petitioners and the seven similarly situated facilities from October 1, 2000, to the present, as unrelated party \ ICA agrees further to pay Petitioners and the seven similarly situated e) Petitioners and Steven A. Strawn, on behalf of the seven similarly situated facilities, 7 7 A ~ Specifically reserve their rights to challenge AHCA’s rate computations to ensure that they are proper and in accordance with this settlement agreement and the Plan. OER genre es me oo f) Upon execution of this settlement agreement, Petitioners and the similarly situated | facilities shall dismiss their petitions with prejudice. g) All parties and the similarly situated facilities will bear their own fees and costs associated with these proceedings, but Petitioners and the similarly situated facilities may claim their attorney’s and accountant’s fees and costs in the appropriate cost reports, subject to the Plan. | 8. This settlement agreement may be executed in counterparts and sent via facsimile each of which shall constitute an original, but all of which together shall constitute one and the same instrument. STIPULATED AND AGREED to the date of the last dated signature ‘below. THE PETITIONERS, THE HEALTH CENTER OF NAPLES, INC., d/b/a THE ARISTOCRAT; THE HEALTH CENTER OF HUDSON, INC., d/b/a BAYONET POINT HEALTH & REHABILITATION CENTER; THE HEALTH CENTER OF LAKE CITY, INC., d/b/a HEALTH CENTER OF LAKE CITY; THE HEALTH CENTER OF PLANT CITY, INC., d/b/a THE HEALTH CENTER OF PLANT CITY; THE HEALTH CENTER OF __ ‘PORT CHARLOTTE, INC, “d/b/a “ CHARLOTTE HARBOR HEALTHCARE, Py u baal fot mee ; : AEL J. BIETMAN- Mond Bar No. 0347132. Gray, Harris & Robinson, P.A. 301 E. Pine Street, Suite 1400 Post Office Box 3068 ; . Orlando, FL 32802- 3068 / a (407) 843-8880 Telephone (615) 217-2324 Telephone (407) 244-5690 Facsimile (615) 217-2326 Facsimile Attomeys for Petitioners 7 Date_G//t/ 2001 Date: &) 2001 6/7 6 "THE RESPONDENT, AGENCY FOR HEALTH CARE ADMINISTRATION Bob Sharpe Neu, See Medicaid Rey Fea Talal , 2001 Date: Senior Attorney Agency for Health Care Administration * 2727 Mahan Drive Fort Knox II, Suite 3431 Tallahassee, FL 32308-5403 (850) 921-0056 Telephone (850) 413-9313 Facsimile Date: LC LL , 2001 J ALLAGH General Counsel “Agency for Health Care Administration 2727 Mahan Drive Fort Knox HI Tallahassee, FL 32308 (850) 922-5873 Telephone Date: Lf {uf , 2001 ult Pall FOR THE SEVEN SIMILARLY SITUATED FACILITIES, THE HEALTH CENTER OF IMPERIAL, INC.; THE HEALTH CENTER OF COCONUT CREEK, INC.; THE HEALTH CENTER OF MERRITT TSLAND, INC.; THE HEALTH CENTER OF DAYTONA BEACH, INC.; THE HEALTH CENTER OF ORLANDO, INC.; THE HEALTH CENTER OF PENSACOLA, INC.; THE HEALTH CENTER OF STUART, INC. By: 47 STEVEN A. STRAWN, Sole Director 421 W. College Street Murfreesboro, TN (615) 217-2324 Telephone (615) 217-2326 Facsimile Date: G/& , 2001

Docket for Case No: 01-001601