STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

UNIVERSITY HOSPITAL BUILDING, ) INC., d/b/a MEMORIAL HOSPITAL OF ) JACKSONVILLE, )

)

Petitioner, )

)

vs. ) Case No. 78-1783

)

DEPARTMENT OF HEALTH AND ) REHABILITATIVE SERVICES, OFFICE ) OF COMMUNITY MEDICAL FACILITIES, )

)

Respondent. )

) UNIVERSITY HOSPITAL BUILDING, ) INC., d/b/a MEMORIAL HOSPITAL OF ) JACKSONVILLE, )

)

Petitioner, )

)

vs. ) Case No. 78-1784

)

DEPARTMENT OF HEALTH AND ) REHABILITATIVE SERVICES, OFFICE ) OF COMMUNITY MEDICAL FACILITIES, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, an administrative hearing was held before Diane D. Tremor, Hearing Officer with the Division of Administrative Hearings, commencing on October 27, 1978, in Jacksonville, Florida, and continuing on October 31, 1978, in Tallahassee, Florida. The purpose of the hearing was to determine whether the petitioner is entitled to certificates of need to institute services for cardiac catheterization (Case No. 78-1783) and for open heart surgery (Case No. 78-1784).

APPEARANCES

For Petitioner: Kenneth F. Hoffman

Rogers, Towers, Bailey, Jones and Gay Post Office Box 1872

Tallahassee, Florida 32302

For Respondent: Robert M. Eisenberg

District IV Legal Counsel Post Office Box 2417-F Jacksonville, Florida 32231

Charles Collette Assistant General Counsel Department of Health and

Rehabilitative Services 1317 Winewood Boulevard

Tallahassee, Florida 32301 FINDINGS OF FACT

Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found:

1. Petitioner University Hospital Building, Inc., d/b/a Memorial Hospital of Jacksonville, is a 299 bed (309 beds have been approved) acute care general hospital. It has an active emergency room, admitting some 35,000 patients per year. Petitioner has an open staff of 500 doctors, 150 doctors actively using the hospital on an annual basis. There are thirty cardiovascular specialists at Memorial. This large number is due to the fact that Memorial receives numerous heart patients because of its active emergency room and convenient location.

   
   

2. Petitioner's long range development plan, goal and philosophy is to provide a full service, critical care hospital. In furtherance of this critical care goal, petitioner applied for and received in 1973 and 1974 certificates of need which included approval for expansion of surgical intensive care facilities and a critical care unit. When these certificates were obtained, there was apparently no requirement that separate certificates of need be acquired for cardiac catheterization laboratories or facilities for open heart surgery. Petitioner presently has an existing coronary care unit with extensive monitoring equipment, including a computerized EKG program. The only facilities lacking for the full medical service intended in the long range development plan of petitioner are the heart catheterization lab and the open heart surgery equipment. Petitioner presently has facilities and equipment to perform arteriograms for every blood vessel in the body except the heart arteries.

   
   

3. In April of 1978, petitioner submitted two applications for a certificate of need. One was for a "radiology special procedure room update" to provide for the procedure known as cardiac catheterization at a projected cost of $127,000.00. The second was for an open heart surgery procedure at a capital expenditure of $27,000.00 for the purchase of a pump for open heart surgery.

   
   

4. The petitioner's applications for certificates of need for cardiac catheterization and open heart surgery were originally reviewed and considered by the Health Systems Agency (HSA) of Northeast Florida Area 3, Inc. At the time of review of these applications, the governing body of this HSA had sixty- eight members, thirty-five of which were consumers and thirty-three of which were providers. By unanimous or nearly unanimous votes, the three recommending bodies of the HSA -- the health needs and priorities committee, the executive committee and the HSA governing body -- recommended approval of both applications. In its reports to respondent HRS, the HSA recognized that the existing facilities in the area were not performing the number of procedures recommended by either the Health Systems Plan or the National Guidelines for Health Planning. However, the HSA considered the large heart caseload handled by petitioner. It was felt that petitioner would have a sufficient caseload to operate its catheterization lab effectively and that it presently had the manpower and facilities necessary to perform open heart surgery, except for the relatively inexpensive heart pump. The HSA found that the additional capital and operating costs of the two proposals would be minimal because most of the

   other facilities, services and manpower necessary to complement the new services were already in place in the facility. The HSA further found that petitioner serves as a major hospital emergency room center for southside Jacksonville and that patients within the service area may experience serious problems in terms of availability and accessibility to the services proposed.

   
   

5. The respondent Office of Community Medical Facilities reviewed the petitioner's applications and the findings and reports of the HSA. The transcripts of the various HSA committees and boards were not reviewed. The respondent also considered the utilization figures contained in the National Guidelines and the Report of the Inter-Society Commission for Heart Disease Resources. The figures supplied by the HSA as to the numbers of procedures performed at existing facilities of other hospitals were relied upon by the respondent. By letters dated August 25, 1978, the respondent notified petitioners that their capital expenditure proposals to institute cardiac catheterization and open heart surgery services were not favorably considered. The respondent found that according to present and projected utilization rates the existing facilities, such existing services were underutilized and that additional units or programs would probably cause the average cost of such services to rise in Duval County. Respondent further concluded that as both cardiac catheterization and open heart surgery were done primarily on a non- emergency basis, the alternative of shared service arrangements would deem more appropriate and that the petitioner did not show that southern Duval County residents would experience serious problems in obtaining such services.

   Finally, the respondent concluded that the standards established by the National Guidelines and the Inter-Society Commission indicated that there was no need at this time for additional cardiac catheterization units or open heart surgery programs. With regard to the cardiac catheterization lab, the respondent found that the HSA's recommendation of approval was inconsistent with the HSA's Health Systems Plan.

   
   

6. Cardiac catheterization is an invasive diagnostic procedure whereby a catheter is inserted into a large blood vessel in the body and then placed into the heart chambers. From this procedure, blood samples and various pressure data is obtained to make an accurate cardiac diagnosis. Cardiac catheterization is not originally contemplated for eighty to ninety percent of the patients admitted to Memorial Hospital. Three types of patients are referred for cardiac catheterization. The first is the patient who has intermittant chest pain and it is not known whether that person has heart disease. The second is the patient who is known to have heart disease but who is not responding to medication and, therefore, alternative methods of treatment must be considered. The third is the patient who is in the middle of a massive heart attack and may be saved if the medical problem could be found and surgery performed. Transporting these three categories of patients to another facility can be dangerous to the patient. The incidents or complications from this procedure in transfer patients is higher than with those hospitalized in a facility which has a catheterization lab. The complication rate is approximately seven percent in a transported patient as opposed to a little over one percent in patients who are not transported. Petitioner intends to charge $700.00 per procedure which is comparable to or less than the fee charged by existing labs. The patient who is transported to another facility from Memorial would, of course, save the cost of the ambulance service if Memorial had its own lab. A complication resulting from transport could result in extra days spent in the hospital, thus raising the patient's costs. Between July 1, 1976 and June 30, 1977, Dr. Robert Pekaar, who specializes in cardiac catheterizations, performed 251 cardiac catheterizations and coronary arteriograms on patients who were either transferred from Memorial Hospital or were referred to him by physicians who

   were primarily based at Memorial. In its application, petitioner projected that it would perform 150 procedures the first year of operation, 250 procedures the second year and 350 procedures the third year of operation.

   
   

7. Cardiac catheterization laboratories presently exist in four hospitals located within seven miles of petitioner's hospital. For the calendar year 1977, Baptist Medical Center, located three to four miles from petitioner, performed 804 cardiac catheterizations. Baptist has two laboratories with a comfortable capacity of performing 12 procedures per day. Baptist is presently averaging about 4 procedures per day. Baptist has recently denied staff privileges to two qualified cardiologists to do diagnostic procedures in their catheterization laboratories. Thus, at the time of the hearing on these matters, Baptist Medical Center had closed catheterization labs. St. Vincent's Medical Center performed 709 adult procedures in 1977, University performed 302 adult and 90 pediatric procedures and St. Luke's performed over 174. According to the HSA report, relied upon by respondent, St. Luke's Hospital shares its laboratory with radiology and only 35 percent of the procedures done in the special procedures room are cardiac catheterizations. No inordinate delays have been encountered when utilizing the Baptist facilities. While a three day wait is customary, cardiac catheterization is generally done on an elective basis. Petitioner has no formal, written sharing agreement with Baptist as to the use of its laboratory.

   
   

8. Open heart surgery was first performed in 1954. In 1977, some 76,000 direct vascularization procedures were performed, not taking into account the open heart procedures such as replacement of valves and congenital repairs. The mortality rate in coronary artery bypass procedures is between one and two percent, which is comparable to most general surgical procedures.

   
   

9. Petitioner receives its heart patients either through physician admittance or through its emergency room. Petitioner feels it needs the capacity to perform open heart surgery in order to offer the best medical care to trauma patients admitted to the emergency room (i.e., those who have heart injury due to an automobile accident or gunshot or knife wounds) and to those patients admitted due to a full blown or impending myocardial infraction. Due to time and the danger of moving the patient around, it is hazardous to transport these patients to another facility. The only equipment needed for petitioner to perform open heart surgery is a cardiopulmonary bypass machine or heart pump, at an estimated cost of $27,000.00. Petitioner projects the number of open heart surgery procedures for the first year to be 100, 200 the second year and 300 the third year.

   
   

10. Four institutions in Jacksonville presently have existing facilities and equipment for open heart surgery. These facilities are located within seven miles of petitioner. During calendar year 1977, Baptist performed 190 adult open heart surgeries, St. Luke's performed 57, St. Vincent's performed 328 and University performed 29. The numbers estimated to be performed in 1978 for these same institutions was 200, 100, 330 and 100, with University performing an additional 60 pediatric open heart surgeries. The nearest facility, Baptist, has two rooms available for open heart surgery but presently only utilizes one room, doing approximately four per week. Delays of up to three weeks in the scheduling of such surgery have been encountered, though this is not a continuing problem.

    
    

11. Other than the general criteria set forth in the State statutes and Department regulations, the respondent has adopted no rules regarding the numbers of cardiac catheterization or heart surgical procedures performed by

    existing facilities considered to be sufficient before a new facility is authorized. The applicable Health Systems Plan does state that each of the existing catheterization labs should be operating at 500 procedures per year. However, the HSA's Annual Implementation Plan does allow for exceptions to the Health Systems Plan when extraordinary circumstances exist.

    
    

12. Based on the recommendations of the Inter-Society Commission on Heart Disease Resources, the federal Department of Health, Education and Welfare has adopted national guidelines and standards for open heart surgery and cardiac catheterization. For open heart surgery, the standards are that there should be a minimum of 200 open heart procedures performed annually within three years after initiation and that no additional units should be initiated unless existing units are operating at a minimum of 350 adult open heart surgery cases per year or 130 in pediatric. For cardiac catheterization, the standards are

    300 adult procedures performed annually within three years after initiation and existing units performing 500 adult catheterization studies per year. Further, the national standards include the requirement that no new catheterization unit be opened in any facility not performing open heart surgery. As noted above, these are national standards based upon the recommendations of the Inter-Society Report. The respondent HRS is in the process of adopting as rules these same standards with regard to the number of procedures being performed in existing facilities, but the promulgation and adoption process has not yet been completed. No testimony as to the reasonableness or accuracy of the figures contained in the national guidelines was adduced at the hearing.

    
    

    CONCLUSIONS OF LAW

    
    

13. The evidence illustrates, and the parties so stipulated, that petitioner gave timely notice of its intention to make capital expenditures and that respondent and the HSA timely complied with the procedural requirements for review. Thus, the only remaining issue is whether the applicant's proposals meet the substantive requirements of the certificate of need laws. The parties stipulated that the petitioner has met the criteria relating to the financial feasibility of the proposals and the availability of resources for the provision of the proposed services. The prime dispute in this matter is whether there is a need in the community for additional cardiac catheterization services and open heart surgery programs in light of the availability and accessibility of existing services. Respondent has taken the position that due to the underutilization of accessible existing facilities, the petitioner's applications should be denied.

    
    

14. An applicant for a certificate of need has the burden of demonstrating that its proposal meets the criteria and standards for review. Among those criteria are the need that the population served has for the proposed health services and the availability and accessibility of alternative, less costly methods of providing such services. Florida Statutes, Section 381.494; Florida Administrative Code, Ch. 10-5.10 and 10-5.11. Here, the respondent found that the existing services for cardiac catheterization and open heart surgery were underutilized and, therefore, there was no community need for similar additional services. This finding was based upon figures concerning minimum utilization contained in federal guidelines and the Report of the Inter-Society Commission for Heart Disease Resources. No testimony or direct evidence concerning the reasonableness of these figures as measuring devices of need was offered by the respondent. Nor have these figures been officially adopted or promulgated as rules. The formula for utilization of catheterization services and/or open heart surgery programs not having been supported by substantial competent evidence and not having been adopted or promulgated in accordance with the

    Administrative Procedure Act, the undersigned Hearing Officer cannot accept such figures as a sole basis for decision. North Miami General Hospital v. Office of Community Medical Facilities, Dept. of HRS, 355 So.2d 1272 (Fla. App. 1st, 1978).

    
    

15. The evidence adduced at the hearing demonstrates a need for both cardiac catheterization and open heart surgery programs at petitioner's facility. The HSA, composed of local consumers and providers and charged with the responsibility of reviewing applications for new services, found such a need and unanimously recommended approval. This finding and recommendation, when based upon statutory and regulatory criteria and standards, is entitled to great weight and consideration. Evidence was introduced that petitioner's facility has a very active emergency room, a large staff of heart specialists, a large number of heart patients, long range development plans to be a full service, critical care hospital and the financial and resource feasibility to provide the community with cardiac catheterization and open heart surgery services. Such services located within petitioner's facility would provide the best medical care to patients admitted to Memorial Hospital of Jacksonville. To transport trauma and serious heart patients to another facility presents a safety hazard and additional expenses to the patient.

    
    

16. While there was evidence that Baptist has the capacity to perform more heart catheterization and surgical procedures than it presently performs, this fact in itself should not operate to preclude a hospital otherwise capable from offering the same services where a need for such services is apparent with regard to quality medical care and patient safety. The fact that the closest facility to petitioner, Baptist, has a closed catheterization lab must also be considered. Further, there was no testimony or evidence that Baptist would be adversely affected if petitioner were to initiate cardiac catheterization or open heart surgery procedures.

    
    

17. In view of the large number of heart patients admitted to petitioner's facility, the estimated number of catheterization and surgical procedures projected by petitioner appear reasonable and illustrate a community need for such services at Memorial Hospital. Petitioner having demonstrated that its two proposals meet the statutory and regulatory criteria for review, and there being no competent, substantial evidence to support respondent's basis for denying the applications, it must be concluded that the two applications for certificates of need should be granted.

RECOMMENDATION

Based upon the findings of fact and conclusions of law recited above, it is recommended that petitioner's applications for certificates of need to institute cardiac catheterization and open heart surgery services be GRANTED.

Respectfully submitted and entered this 15th of January, 1979, in Tallahassee, Florida.

DIANE D. TREMOR

Hearing Officer

Division of Administrative Hearings

530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675

COPIES FURNISHED:

Kenneth F. Hoffman

Rogers, Towers, Bailey, Jones and Gay Post Office Box 1872

Tallahassee, Florida 32302

Robert M. Eisenberg District IV Legal Counsel Post Office Box 2417-F

Jacksonville, Florida 32231

Charles Collette Art Forehand, Administrator Assistant General Counsel Office of Community Medical Department of HRS Facilities

1317 Winewood Boulevard Department of HRS Tallahassee, Florida 32301 1323 Winewood Boulevard

Tallahassee, Florida 32301

Docket for Case No: 78-001783

Orders for Case No: 78-001783