vs. ) CASE NO. 79-766
DEPARTMENT OF HEALTH AND ) REHABILITATIVE SERVICES, OFFICE ) OF COMMUNITY MEDICAL FACILITIES, )
Respondent. )
) FT. MYERS COMMUNITY HOSPITAL )
Intervenors. )
Pursuant to notice, an administrative hearing was held before Diane D. Tremor, Hearing Officer with the Division of Administrative Hearings, on April
25 and 26 and May 23 and 24, 19797, in Ft. Myers and on July 20, and 23, 1979, in Tallahassee, Florida. The issue for determination at the hearing was whether the Department of Health and Rehabilitative Services should grant the application of Gulf Coast Hospital, Inc. for a certificate of need to construct and operate a new 116-bed acute care hospital in Ft. Myers, Florida.
For Respondent: Eric J. Haugdahl
Assistant General Counsel 1323 Winewood Boulevard Building One, Suite 406 Tallahassee, Florida 32301
For Intervenor: E. G. "Dan" Boone
and Bruce E. Smith
Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found:
On August 1, 1978, a letter of intent to construct an osteopathic hospital in Ft. Myers was filed by Hospital Affiliates International on behalf of the petitioner/applicant Gulf Coast Hospital, Inc. The petitioner is comprised of seven osteopathic physicians practicing in Lee County, Florida.
The application seeks approval for the construction and operation of a 116-bed , acute care hospital at a proposed cost of $12,805,000.00.
The petitioner's application was reviewed by the South Central Florida Health System Council, Inc. The Board of Directors recommended disapproval of the application by a vote of 21 to 11. The Administrator of the respondent's Office for Community Medical Facilities advised the applicant by letter dated March 14, 1979, that its proposal was not favorably considered. As grounds for this decision, it was found that the project was not consistent with the local Health Systems Plan; that there was no need for the project in terms of availability, accessibility, extent of utilization and adequacy of like and existing facilities and services; and that there are less costly, more appropriate alternatives to the proposed project.
Thereafter, the petitioner timely requested an administrative hearing on the denial of its application and the Fort Myers Community Hospital (FMCH) timely moved to intervene in the proceeding.
There are four hospitals located in Lee County, with a total of 1,146 beds. Lee Memorial Hospital has 558 beds and operates at an occupancy rate of approximately 59 percent. Over the past twelve months, Lee Memorial averaged
250 empty beds. FMCH has 400 beds and an occupancy rate of 40 percent. It averaged 150 empty beds last year. Cape Coral Hospital has 100 beds with a 74 percent occupancy rate and Lehigh Acres has 88 beds with an occupancy rate of approximately 46 percent. According to the local Health Systems plan, Lee County will still have 265 excess hospital beds in the year 1983.
Prior to the time the applicant filed its letter of intent, there was an established practice in the Lee County community of discriminating against osteopathic physicians (D.O.) by excluding them from admittance to the medical staffs of three of the four local hospitals. The only exception to total exclusion was Lehigh Acres which gave one osteopathic physician, Dr. N. Centafont, staff privileges, Dr. Centafont has experienced a coolness in attitude from some of the staff at Lehigh, different requirements with regard to a sponsor were applied to him and he has not been able to perform manipulative medical treatment under anesthesia to his patients at Lehigh. Lehigh has recently rejected the applications of two other D.O.'s, although the grounds for such rejection were not fully clarified at the hearing.
Dr. A. J. Piccola, an osteopathic physician and organizer and spokesman for the petitioner/applicant, applied to Fort Myers Community Hospital for staff privileges in 1974. His application was tabled and not acted upon for a period of almost four years. The Board of FMCH made several attempts during this interim period to change the interpretation of its bylaws by vote of the medical staff so as to allow osteopathic physicians to become members of the staff. Several votes were taken on the issue, but each time the issue was defeated.
Dr. Piccola also submitted a letter of intent to file an application for membership on FMCH's staff in 1977. However, he never did file another
application. In August or September of 1978, after the time that FMCH learned of the petitioner's certificate of need application, the Administrator of FMCH contacted Dr. Piccola and asked him if he wished to have his application for staff membership reactivated. Dr. Piccola informed the Administrator that he did not. Nonetheless, the credentials committee of FMCH unilaterally reactivated Dr. Piccola's 1974 application and, on October 26, 1978, informed Dr. Piccola that he had been appointed an associated member of the Hospital's medical staff. Dr. Piccola has not exercised the privileges extended to him because he does not believe he was properly accepted as a member of the medical staff in accordance with the bylaws of FMCH and because he felt that to do so would jeopardize the petitioner's efforts in obtaining a certificate of need for its own hospital. FMCH considered Dr. Piccola to be a member of its medical staff.
Three other osteopathic physicians who were original organizers of the petitioner have been accepted as consulting staff members of the FMCH. At least two of these physicians felt some pressure to join the staff of FMCH after petitioner filed its application for a certificate of need. These three D.O.'s have apparently withdrawn as organizers of petitioner and at least two of the three would remain at FMCH even if petitioner's hospital were built.
Other than the four D.O.'s discussed above, no other osteopathic physicians have applied to FMCH for staff privileges. Several of the local D.O.'s testified that they did not apply to FMCH prior to their own application for a certificate of need because they knew it would be a futile effort and that they did not apply afterward because it would hamper the granting of authority to have their own hospital.
The Administrator of FMCH testified that it will be the policy of FMCH in the future to admit osteopathic physicians to its staff if they are otherwise qualified, and that FMCH stands ready to purchase equipment necessary for the practice of manipulative medicine if requested to do so by its osteopathic physicians. It was also his testimony that the granting of privileges to local D.O.'s at the same time of their certificate of need application was a coincidence of time and not of intent.
At the time of the hearing and at all times prior thereto, the other two hospitals in the area, Lee Memorial and Cape Coral Hospitals, unequivocally denied osteopathic physicians the right to practice in their hospitals.
The 1979 Legislature passed a new law which became effective on July 1, 1979. Section 395.035, Florida Statutes, prohibits licensed hospitals from excluding doctors of osteopathy from staff membership or privileges on the sole basis that they are D.O.'s. It further mandates each hospital to set standards and procedures to be applied in considering and acting upon applications for staff privileges and to make the same available for public inspection. This must be accomplished within 180 days of July 1, 1979.
As noted above, the petitioner seeks to build and operate a 166-bed acute care hospital. Its application stated that osteopathic physicians presently treat 40,000 patients in the area. This figure was not verified or substantiated by testimony or other evidence during the hearing, nor was there sufficient testimony concerning the number of patients osteopathic physicians were presently admitting to area hospitals.
Several of the D.O.'s do practice manipulative medicine. Such treatment requires a specialized straight table. The cost for this equipment
was not established, and the testimony indicates that its cost can range from several hundred to several thousand dollars. If petitioner's application is granted, it is proposed that petitioner will have a manipulative medicine department with two treatment rooms and two full-time personnel for this purpose.
During the first days of the hearing, it had not yet been determined whether the petitioner would have an open or mixed staff of osteopathic and allopathic doctors. It was originally thought that petitioner would be solely a
D.O. hospital, with consulting medical doctors on staff. Because of the new law, petitioner now intends to have a mixed staff.
Testimony from witnesses who had had experience with working on mixed staff hospitals established that D.O.'s and M.D.'s can and do work harmoniously together. The only real difference in the physical plants of allopathic and osteopathic hospitals are the treatment rooms for manipulative medicine. Many D.O.'s do not practice manipulative medicine and only ten to fifteen percent of those who do require a hospital setting. There is some small difference in the medical charts used by D.O.'s with regard to a space for the structural examination. Otherwise, there is no substantial difference in the day-to-day function or operation of an osteopathic hospital.
There was no conflict in the testimony that Lee County and the Ft. Myers area is presently overbedded by at least 400 beds. The Administrators of FMCH and Lee Memorial Hospital testified that the addition of 116 hospital beds as proposed by petitioner would financially harm their institutions, raise patient charges, and create an even greater excess of hospital beds. They further testified that the staffing of petitioner's facility with 253 employees would create manpower shortages in the area, and cause their facilities to be required to increase salaries for their personnel.
CONCLUSIONS OF LAW
The issuance of a certificate of need is governed by the general criteria set forth in Section 381.494, et seq, Fla. Stats., and the regulations promulgated pursuant thereto. There is also a separate statutory criteria relating to osteopathic facilities and services. Florida Statutes, Section 381.494(2), provides that
"When an application is made for a certificate of need to construct or to expand an osteopathic facility, the need for such facility shall be determined on the basis of the need and avail-
ability in the community for osteopathic services and facilities."
In the entire review process and throughout this proceeding, it has been the petitioner's contention that due to the above statutory language, an application to construct an osteopathic facility is to be judged on a separate and independent basis, and is not to be judged along with existing allopathic facilities. Regardless of an overbedding situation in an area, contends the petitioner, the issue is one of need for osteopathic facilities.
The respondent has interpreted Section 381.494(2), Florida Statutes, to mean that the key questions in any certificate of need review are cost containment, need and availability of services and facilities. It is only when there is a demonstration of existing discrimination against osteopathic
physicians or patients that the provisions of s. 381.494(2) require that the certificate be granted regardless of what the county or area need for the service or facility is. In other words, certificates of need for osteopathic facilities or services will be granted if it is found that either there is an overall need for such facilities in the community or if osteopaths are being discriminated against in the community. The intervenor Fort Myers Community Hospital agrees with this interpretation by respondent.
The undersigned Hearing Officer concludes that the respondent's interpretation of s. 381.494(2) is the correct one. Where an area is already overbedded, an applicant for a new 116-bed osteopathic hospital must demonstrate that osteopathic services and facilities are not otherwise available in the community. To adopt the petitioner's construction of the statute would be contrary to the purpose and intent of the certificate of need law, and would authorize the construction of an osteopathic hospital in every community in which one did not presently exist.
The issues in this proceeding can thus be narrowed to three: (1) Is the petitioner's proposed facility an osteopathic facility? (2) Has the petitioner demonstrated a need for an additional 116 beds in Lee County? (3) Are similar services or facilities available in the area?
From the evidence adduced at the hearing, there is a real question as to whether petitioner's proposed facility can truly be classified as an osteopathic facility. While the organizers of the proposed facility are all doctors of osteopathy, there is little else to distinguish the facility as an osteopathic, as opposed to an allopathic, hospital. Hospitals are simply licensed as acute care general hospitals. There is no separate license for an osteopathic or an allopathic hospital. Aside from an intent to provide two treatment rooms and two tables for the practice of manipulative medicine, to assign two of its 253 employees to this area and to provide slightly different patient charts, there is nothing in the application or the testimony to distinguish the proposed facility from an allopathic hospital. Petitioner anticipates having an open or mixed staff.
Even if the petitioner is construed to be an osteopathic facility, it still must demonstrate a need for the number of beds requested, as well as the lack of availability of similar facilities. Here, the testimony was not sufficient to establish a need for 116 beds. The court of 40,000 osteopathic patients in the area as contained in the application was simply not substantiated by competent evidence adduced at the hearing. There was little or no evidence regarding the number of osteopathic patients who are admitted to area hospitals. the figures in the application were based upon the fact that twelve local D.O.'s would use and support the proposed facility. Only seven such supporters and users were named during the hearing. In summary, the petitioner did not present sufficient evidence to indicate a need for a 116-bed osteopathic hospital.
The evidence adduced at the hearing clearly reveals that in the past osteopathic physicians have been discriminated against in Lee County. Two hospitals in the area still refused to admit them to their medical staffs at the time of the hearing. The obvious intent of the new law which took effect on July 1, 1979, (Fla. Stats. s. 305.035) is to prevent such discriminatory treatment of D.O.'s in the future.
The test of "need and availability" for osteopathic facilities is not to be judged by what took place in Lee County five years ago. The test is need
and availability at the time of final agency determination for a certificate of need. The evidence in this case is that two hospitals in Lee County admit osteopathic physicians to their medical staffs. FMCH has gone on record and has illustrated by its conduct that it will admit qualified D.O.'s to its staff and provide them with the equipment necessary for their practice. Much of the evidence at the hearing was devoted to the issue of whether Dr. Piccola was or was not on the staff of FMCH. Such is not a proper issue in this proceeding.
The proper issue is whether other facilities in the area are available to osteopathic physicians. The evidence establishes that they are and this fact cannot be erased or negated by the unwillingness of the D.O.'s to avail themselves of the use of such facilities.
Lee County is grossly overbedded at this time. The local Health Systems Plan indicates that it will still have 265 excess beds in 1983. The principle of cost containment would not be served by adding 116 beds when present similar facilities are available to osteopathic physicians and there are at least 400 empty hospital beds located in Ft. Myers.
Based upon the findings of fact and conclusions of law recited above, it is RECOMMENDED that the petitioner's application for a certificate of need to construct and operate a 116-bed acute care hospital in Ft. Myers be DENIED.
Respectfully submitted and entered this 19th day of September, 1979, in Tallahassee, Florida.
DIANE D. TREMOR
Eric J. Haugdahl Assistant General Counsel Department of HRS
E. G. "Dan" Boone Post Office Box 1596 Venice, Florida 33595
Bruce E. Smith
