STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

EDEN PARK MANAGEMENT, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 79-266

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent. )

)

RECOMMENDED ORDER

This matter came on for final hearing in Port St. Lucie, Florida, before the Division of Administrative Hearings by its duly designated Hearing Officer, Robert T. Benton, II, on March 9, 1979. The parties were represented by counsel:

APPEARANCES

For Petitioner: Mark W. Hoffman, Esquire

Arcade Building

488 Broadway

Albany, New York 12207

For Respondent: Eric J. Haugdahl, Esquire

Building One, Suite 406 1323 Winewood Boulevard

Tallahassee, Florida 32301

Pursuant to Section 381.494, Florida Statutes (1977) petitioner applied for a certificate of need for a 120 bed skilled nursing facility in the area of Port St. Lucie, Florida. When respondent proposed to grant a certificate of need for a 60 bed facility only, petitioner demanded a hearing by letter dated January 4, 1979.

FINDINGS OF FACT

1. Port St. Lucie, Florida is in south St. Lucie County, approximately half way between Ft. Pierce, the county seat, and Stuart, which is in Martin County. At or about the time petitioner filed its application for dual certification for a 120 bed skilled nursing facility in or near Port St. Lucie, a competitor, Florida Living Care, Inc. (FLC) filed an application for certification for a 102 bed nursing home in Ft. Pierce. Both of these applications were considered by the Indian River committee of the Health Planning Council, Inc. (HPC), the health systems agency with jurisdiction in St. Lucie County. The Indian River committee recommended approval of petitioner's application by a unanimous 16 to 0 vote.

2. The HPC staff recommended that petitioner's application be acted on favorably and that FLC's application be acted on unfavorably. When the HPC's board of directors first considered FLC's application, the vote was tied, 8 to

1. The HPC board then took up petitioner's application and voted 12 to 4 in favor of recommending that petitioner's application be approved. Upon reconsideration of FLC's application, the HPC board voted 9 to 7 in favor of recommending it, also. Subsequently, respondent's office of community medical facilities granted FLC's application in its entirety, but granted petitioner a certificate of need for a 60 bed facility only. On the theory that this partial denial was also a partial grant, respondent offered no written reasons for its decision on petitioner's application.

   
   

   1. There are some 250 existing nursing home beds in Ft. Pierce, where there has been a 94 percent occupancy rate for more than a year. There is no nursing home in Port St. Lucie. The population of Port St. Lucie is about 10,000 persons. The population of Ft. Pierce is about 24,000 persons. Some 38,963 persons live in unincorporated areas of St. Lucie County. Of this number, some 13,594 live south of State Road 712 and east of the North Fork of the St. Lucie River. Population growth is expected to occur at a faster rate in the southern part of Port St. Lucie County than in the northern part.

      
      

   2. In 1978, the City of Port St. Lucie issued 1,284 building permits for single family dwellings, up from 804 such permits in 1977. Ralph N. LaChance, building official for Port St. Lucie, predicts that there will be more than 1,605 single family housing starts in Port St. Lucie during 1979. In addition, the City of Port St. Lucie has approved approximately 1,756 multi-family units for which construction is expected to "begin within months, and continue over the next two years." Petitioner's exhibit No. 4. Many of Port St. Lucie's residents are retired persons, some of whom recently moved to Florida; bringing aged parents. Retired persons comprise fifty-eight percent of the congregation of a local Methodist church. In 1975, about one-third of Port St. Lucie's population was over 55 years of age. Many of Port St. Lucie's residents are widows or widowers.

      
      

   3. The average daily cost for patients at Martin Memorial Hospital in Stuart is approximately $105.00. About one tenth of Martin Memorial's patients live in Port St. Lucie. At the time of the hearing, there were patients in Martin Memorial whose medical condition had, for some weeks, warranted transfer to a nursing home, but for whom no nursing home beds could be found. In the past, Martin Memorial patients have been sent to nursing homes as far away as Tampa, for want of available beds closer to Stuart. The administration of Martin Memorial has encountered particular difficulty in placing medicaid patients. Pamela Pickard, a social worker in respondent's employ, assists residents of St. Lucie County in looking for nursing home beds. Her experience has been that such a person faces an average wait of two and a half to three months, if the person lives long enough to enter a nursing home.

      
      

   4. Petitioner owns and operates one existing nursing home in Stuart and another in Ft. Pierce, which is called Easter Manor. Under the auspices of Indian River Community College, there is an in-house nurses' training program at Easter Manor. A similar training program is proposed for the new facility in Port St. Lucie. On the average, nursing homes fill 25 to 30 percent of their beds with medicaid patients. At petitioner's Stuart facility, however, there were approximately 115 to 120 medicaid patients, 50 private patients and 10 medicare patients, at the time of the hearing; and at Easter Manor there were approximately 130 medicaid patients, 35 private patients and 5 medicare patients. With a new facility in Port St. Lucie, petitioner will be operating

      three nursing homes approximately ten miles apart. Petitioner proposes to hire a speech therapist and a physical therapist to serve patients at all three facilities and out-patients, as well. In addition, petitioner plans to centralize bookkeeping "food purchasing, Rx supplies, laundry, personnel relations, maintenance [and] consultation ....", Petitioner's exhibit No. 7, for the three facilities.

      
      

   5. There is no public transportation in St. Lucie County. Persons entering nursing homes in the area often leave a spouse behind. On account of vision and hearing impairments, would-be visitors of advanced age sometimes have diminished driving ability. Receiving visitors is important to the well-being of nursing home patients.

      
      

   6. According to the HSP's 1978 Plan for Nursing Homes, 109 new nursing home beds were needed in St. Lucie County by 1982, before petitioner and FLC filed their applications. Petitioner's exhibit No. 7. The 1977 State Medical Facilities Plan projected no need for additional beds per se but contemplated decisions on a case-by-case basis upon a showing that

      
      

      similar facilities in the documented service area have been utilized at an

      optimum rate (85 percent occupancy for acute general hospitals and 90 percent occupancy for nursing homes) for the previous

      12 month period; and,

      
      

      There exists a current, unduplicated waiting list within the documented service area for the services to be

      officered by the new or expanded facility;

      
      

      According to David Sjoberg, employed by respondent in its office of community medical facilities, a 100 person waiting list furnished by FLC was considered in evaluating petitioner's application. This waiting list did not indicate whether the persons listed came from the southern as opposed to the northern portion of St. Lucie County, however.

      
      

   7. There are no significant cost per bed or other differences between petitioner's proposal and FLC's proposal except for location of the facilities, numbers of beds at the facilities, petitioner's plan to hire a speech therapist and a physical therapist to serve three facilities and petitioner's possibility of economizing by centralized accounting, purchasing and the like. The evidence did not show whether FLC's proposed facility would include an in-house nurses' training program, but Robert Seymour, HPC's senior health planner, testified without contradiction that petitioner had a slight advantage vis-a-vis FLC as regards health manpower resources.

      
      

   8. Respondent authorized petitioner to expend 55 percent of the amount a

      120 bed facility would cost for construction of a 60 bed facility, which indicates that construction costs per bed are higher for a 60 bed facility than for a 120 bed facility.

      
      

      CONCLUSIONS OF LAW

      
      

   9. The evidence did not satisfactorily explain why respondent granted FLC's application in its entirety while granting petitioner's application only in part, but this question is not at issue in these proceedings.

   10. Petitioner took the position that it was entitled to a certificate of need for a 120 bed facility, regardless of the fact that respondent had granted a certificate of need to FLC. Only when petitioner insisted on going forward on the assumption that FLC's certificate had been properly granted, did the hearing proceed without FLC's participation. The question for decision, therefore, is whether petitioner demonstrated that a certificate of need should issue for 60 beds more than the 162 beds approved for and the 250 beds existing in St. Lucie County.

       
       

   11. Section 381.494, Florida Statutes (1977), and Rule 10-5.11, Florida Administrative Code, specify the extensive criteria on the basis of which applications for certificates of need are to be granted or denied. Respondent failed to state the grounds for the action it took on petitioner's application, even though Section 120.60(2), Florida Statutes (1977), requires respondent "upon issuing or denying a license [or certificate] . . . [to] state with particularity the grounds or basis for the issuance or denial of same. . ." See also Section 381.494(6)(d), Florida Statutes (1977). At the hearing, respondent took the position that petitioner's application should be denied as inconsistent with the HPC's plan, see Rule 10-5.11(1), Florida Administrative Code, and on the grounds that 60 additional beds were unnecessary. See Rule 10-5.11(3), Florida Administrative Code.

       
       

   12. Petitioner failed to demonstrate any "need that the population [of St. Lucie County] has for," Rule 10-5.11(3), Florida Administrative Code, 60 nursing home beds in addition to 412 existing or approved nursing home beds.

RECOMMENDATION

Upon consideration of the foregoing, it is RECOMMENDED:

That respondent issue to petitioner a certificate of need for a 60 bed skilled nursing facility.

DONE and ENTERED this 6th day of April, 1979, in Tallahassee, Florida.

ROBERT T. BENTON, II

Hearing Officer

Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32399-1550

(904) 488-9675

COPIES FURNISHED:

Eric Haugdahl, Esquire General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32301

Mark W. Hoffman, Esquire Arcade Building

488 Broadway

Albany, New York 12207

Docket for Case No: 79-000266

Orders for Case No: 79-000266