Judges: DIANE D. TREMOR
Agency: Agency for Health Care Administration
Latest Update: Jun. 29, 1983
Summary: Petitioner was not entitled to Certificate of Need (CON) because it did not show need and permitting it would be inefficient as competing hospital just permitted.
82-1746STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
SUN COAST/METROPOLITAN GENERAL ) HOSPITAL, )
)
Petitioner, )
)
vs. ) CASE NO. 82-1746
)
DEPARTMENT OF HEALTH AND )
REHABILITATIVE SERVICES, )
)
Respondent, )
and )
)
MEASE HOSPITAL AND CLINIC, )
)
Intervenor. )
)
RECOMMENDED ORDER
Pursuant to notice, an administrative hearing was held before Diane D. Tremor, Hearing Officer with the Division of Administrative Hearings, on January 17, 18, 19 and 20, 1983, in St. Petersburg, Florida. The issue for determination in this proceeding is whether petitioner is entitled to a Certificate of Need to construct and operate an 86-bed acute care osteopathic hospital in the Palm Harbor area of North Pinellas County, Florida.
APPEARANCES
For Petitioner: Cynthia S. Tunnicliff
Carlton, Fields, Ward, Emmanuel, Smith & Cutler, P.A.
Post Office Drawer 190 Tallahassee, Florida 32302
For Respondent: Robert A. Weiss
Assistant General Counsel Department of Health and
Rehabilitative Services 1323 Winewood Boulevard
Tallahassee, Florida 32301
For Intervenor: John P. Frazer
Frazer & Hubbard, P.A. Post Office Box 1178
Dunedin, Florida 33528-1178
and Kenneth F. Hoffman
Oertel & Hoffman, P.A.
646 Lewis State Bank Bldg. Tallahassee, Florida 32301-1879
INTRODUCTION
Petitioners Sun Coast Hospital and Metropolitan General Hospital, along with four other applicants, applied for a Certificate of Need to construct a new hospital facility in northern Pinellas County, Florida. The respondent Department of Health and Rehabilitative Services (HRS) considered the five applications on a comparative basis and initially denied all five applications. However, upon reconsideration, HRS granted the application of Mease Hospital and Clinic to construct a 100-bed satellite acute care hospital and denied the other four applications. Petitioners requested an administrative hearing on the denial of their own application, but have not challenged the granting of a Certificate of Need to Mease Hospital and Clinic, which has intervened in the present proceeding.
At the hearing, petitioners presented testimony from the following witnesses: Alan J. Snider, D.O., the Chairman of the Board of Sun Coast Hospital; Kenneth W. Whisenand, the Administrator at Sun Coast Hospital; Arnold Melnick, D.O., the Dean of the Southeastern College of Osteopathic Medicine, who was accepted as an expert witness in the field of medical education and entry level requirements for the professions of osteopathic and allopathic physicians;
Mark Skaggs, the internal auditor at Sun Coast Hospital; R. Warren Dacus, who was accepted as an expert witness in the areas of health care planning and health care finance; William Adams, the Executive Director of Metropolitan Hospital; and Donald E. Davis, who was accepted as an expert witness in the areas of health care planning and health care finance. Petitioners' Exhibits 1 through 5 were received into evidence.
The respondent HRS presented the testimony of Thomas F. Porter and Thomas
Konrad, both of whom were accepted as expert witnesses in the area of health care planning, and adopted the testimony of the witnesses and the exhibits presented by the intervenor Mease. Respondent's Exhibit 1 was received into evidence.
The intervenor Mease Hospital and Clinic presented testimony from the following witnesses: Kenneth W. Whisenand; William Adams; Donald J. Baker, the Administrator of Riverside Hospital; Gary Silvers, who was accepted as an expert witness in the area of health care planning and determinations of need; Michael
Schwartz, who was accepted as an expert witness in the area of hospital planning with the exception of capital finance; and Donald M. Schroder, the Executive Director of Mease Hospital and Clinic. The intervenor's Exhibits 1 through 3 were received into evidence. Objections to portions of intervenor's Exhibits 1 and 2 have been considered, as well as the responses to said objections, and the objections are hereby overruled.
Subsequent to the hearing, the petitioners filed a Memorandum of Law and the respondent and intervenor filed proposed recommended orders. To the extent that the parties' proposed findings of fact are not included in this Recommended Order, they are rejected as being either not supported by competent substantial evidence adduced at the hearing, irrelevant or immaterial to the issues in dispute or as constituting conclusions of law as opposed to findings of fact.
FINDINGS OF FACT
Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found:
By an application filed in late 1981, Sun Coast Hospital, in partnership with Metropolitan General Hospital, sought approval from the respondent HRS for a Certificate of Need to construct an 86-bed acute care hospital facility in the Countryside area of North Pinellas County. The facility is to be known as the Palm Harbor Hospital and is to be located on State Road 584, some 18 to 20 miles from the existing Sun Coast Hospital. The proposed facility is to be a free-standing hospital with 80 medical/surgical beds and 6 intensive care beds. Twenty-six of the beds are to be transferred from Sun Coast Hospital. The total project cost is $10,066,533 to be financed by a bond issue at 15 percent interest for 30 years. It is anticipated that Sun Coast and Metropolitan General will split the initial costs of the Palm Harbor facility. It is proposed that the new facility will have a radiology department, a laboratory, a surgical department and an emergency room. Metropolitan and Sun Coast will serve as back-up facilities for the more complicated procedures. The medical staff at the new facility will be oriented to osteopathic specialties. It is anticipated that the new Palm Harbor Hospital will be a teaching facility for osteopathic medicine. Petitioners project an 80 percent occupancy rate at the proposed facility for its second year of operation.
The respondent HRS conducted a comparative analysis of petitioners' application along with four other applications for Certificates of Need for hospitals in North Pinellas County. HRS denied petitioners' application, but granted a Certificate of Need to Mease Hospital and Clinic to construct a 100- bed satellite acute care hospital in North Pinellas County. The Certificate of Need issued to Mease is not being challenged in this proceeding. The petitioners' proposed facility is to be located approximately 2.5 miles from the new Mease facility.
Sun Coast and Metropolitan General Hospitals are nonprofit corporations accredited by the American Osteopathic Association (AOA). Metropolitan is located in Pinellas Park and Sun Coast is located in Largo, just north of Ulmerton Road. Sun Coast is one of the largest teaching facilities for osteopathic physicians in the South, and it is the largest teaching facility in Florida. It trains about 30 osteopaths at any given time, and at the time of the hearing, it had 14 interns, 15 externs and 8 residents. Some 95 percent of the physicians on its staff are Doctors of Osteopathy (D.O.).
Sun Coast Hospital has 314 licensed beds, with 248 beds staffed and in operation. It intends to transfer 26 beds to the new Palm Harbor facility. The average monthly occupancy at Sun Coast is 180 beds, or 57 percent of its licensed bed capacity. Out of its 248 operating beds, there are generally 68 open and available beds at all times. Sun Coast presently receives approximately 10 percent of its patient census from the Palm Harbor area.
Teaching hospitals attract primary care physicians to an area. As part of their education, DOs are required to serve a one-year rotating internship at an AOA accredited hospital. This includes rotating service and training in the areas of general medicine, surgery, OB/GYN, pediatrics, pathology and radiology. In the United States, there are 15 Colleges of Osteopathic Medicine, 8 of which have been established in the last 10 years. While there were only 400 osteopathic graduates five to seven years ago, there are presently 1100 graduates per year. There are approximately 16,000 medical doctors graduating each year.
Nationally, approximately 4 percent of all physicians are Doctors of Osteopathy. In Florida, 13 percent of all physicians are Doctors of Osteopathy.
In Pinellas County, there are three AOA accredited hospital facilities with a total of 534 beds, or 12 percent of the total licensed beds. In North Pinellas County (north of Ulmerton Road), there are approximately 439 MDs and 92 DOs, or
17.33 percent of all the physicians. The DOs in North Pinellas have 2.27 AOA accredited beds per D.O., as compared to 3.5 non-AOA available beds per M.D. Based upon total licensed bed capacity, the occupancy levels in Pinellas County for allopathic beds is 69 percent and is 56.2 percent for osteopathic beds. In North Pinellas County, the occupancy levels for total allopathic beds is 73.1 percent and for total osteopathic beds is approximately 55 percent. In North Pinellas County, osteopathic patients account for about 12 percent of all hospital admissions. Osteopathic beds account for approximately 18 percent of the total number of licensed beds in North Pinellas County. Pinellas County has more osteopathic beds than other areas in this State. Approximately 30 percent of all osteopathic beds in Florida are in Pinellas County, which has about 7.5 percent of the State's population.
HRS has no promulgated or established definition of an osteopathic facility. Some experts testified that a facility had to be AOA accredited to be designated a true "osteopathic" facility, while others were of the opinion that only the "concept" of the facility must be osteopathic. While osteopathic physicians receive somewhat different training and education than allopathic physicians, there was no dispute that there is no major difference between an osteopathic and an allopathic hospital with regard to necessary equipment or technical staff. The main equipment difference is a table upon which manipulative therapy is performed in the osteopathic facility. Also, a structural examination of osteopathic patients is performed and, therefore, space is needed on the hospital chart to record the structural evaluation.
There are currently three AOA accredited osteopathic hospitals in Pinellas County--Sun Coast, Metropolitan and Harborside Hospital. University Hospital, which is largely staffed by DOs, but is not AOA certified, also exists in Pinellas County. Located about 25 minutes north of the Countryside or Palm Harbor area is Riverside Hospital in Pasco County. Riverside is owned by American Health Care Enterprises, which also owns Harborside Hospital in St. Petersburg. Riverside was purchased from Pasco County in 1982 and, in the contract of sale, American Health Care made a commitment of its desire to be accredited by the AOA, become an osteopathic teaching facility and be affiliated with the Southeastern College of Osteopathic Medicine in Miami. Riverside has
102 licensed beds, with 100 beds open. Of its total admissions, 56 percent are osteopathic patients. It is operated by a seven member Board of Directors, three of whom are physicians. Two of the three physicians are osteopaths. One of the osteopathic Board members is a trustee of the Southeastern College of Osteopathic Medicine. Riverside's Chief of Medicine is a D.O., as is its Vice- Chief of Staff. Of the 18 family physicians on the staff at Riverside, 14 are DOs. The opening and operation of a new osteopathic facility within a 25 minute drive from Riverside Hospital would harm Riverside financially and would hinder its plans to become an osteopathic teaching facility.
The local health systems plan found a need for 95 additional hospital beds in North Pinellas County. Insufficient evidence was presented by the parties that the need for hospital beds, osteopathic or allopathic, in North Pinellas County was any greater than 95. The applicable standard for accessibility is that hospital beds located within 30 minutes driving time be available for 90 percent of an area's population. In determining the bed needs for an area, it is the policy of HRS to consider community needs in terms of historical utilization and shifts in population. Neither physician opinion,
beds per physician nor the needs of a limited proposed primary service area (as opposed to community need) are given controlling consideration.
The recently approved 100-bed facility of Mease Hospital and Clinic is located about two miles north and 1.5 miles west of the central point of the petitioners' proposed primary service area. The new Mease facility is to be a satellite of the Mease Hospital in Dunedin, which operates at an occupancy level of 74 percent. Mease is not accredited by the AOA and has no separate manipulative therapy department, but it does have 8 osteopathic physicians on its staff. The new Countryside Mease facility plans to have an emergency room, and offer services in radiology, physical therapy and surgery. It is anticipated that two osteopathic physicians will staff the Mease Countryside emergency room. Local law requires that critically ill, emergency patients be transported to the nearest emergency room. The opening and operation of a new osteopathic hospital within two and one half miles of the new Mease Hospital would harm it financially, would divert emergency room patients and inpatients derived there from, and would make it difficult for Mease to adequately staff its new facility.
CONCLUSIONS OF LAW
An applicant for a Certificate of Need must demonstrate that its proposed facility meets the criteria for approval set forth in Section 381.494(6)(c) and (d), Florida Statutes, and corresponding Rules 10-5.11 and 10- 5.12, Florida Administrative Code. The essential purposes and objectives of the Certificate of Need law and review process are to serve the health care needs of a community, while avoiding unnecessary duplications of existing health services, thus resulting in cost containment for health services. The need for new osteopathic facilities is to be determined on the basis of the need for and availability of osteopathic services and facilities in the community. Section 381.494(2), Florida Statutes. Thus, while an application for a Certificate of Need for an osteopathic facility is subject to the same criteria for approval as an allopathic facility, as set forth in Section 381.494(6)(c) and (d), Florida Statues, the criteria of need, availability, quality of care, accessibility, extent of utilization and adequacy are to be measured against the needs of osteopathic physicians and their patients for osteopathic facilities. Gulf Coast Hospital, Inc. vs. Department of Health and Rehabilitative Services, 424 So.2d 86 (Fla. 1st DCA, 1982).
The petitioners-applicants have failed to demonstrate by competent substantial evidence that their proposal for a new 86-bed osteopathic facility to be located in North Pinellas County meets the criteria for approval set forth in either subsections (2) or (6) of Section 381.494, Florida Statutes. The evidence demonstrates that there are osteopathic hospital beds currently available to osteopathic patients and physicians in the applicants' proposed service area. While the actual Palm Harbor Hospital and the existing Sun Coast Hospital to the south was not conclusively established, it was demonstrated that the distance between the two sites is 18 to 20 miles. To the north within 25 minutes driving time is Riverside Hospital, a facility which devotes at least 56 percent of its resources to osteopathic patients. While the occupancy levels of Riverside Hospital were not established at the hearing, it was undisputed that the facilities at the existing Sun Coast Hospital in Largo are underutilized. There was no evidence to suggest that the quality of care or resources of either Riverside Hospital or Sun Coast Hospital are less than adequate.
The need for institutional training programs for doctors of osteopathy at the student, internship or residency training levels is a factor to be considered in Certificate of Need applications. Section 381.494(6)(c)6, Florida Statutes. The evidence in this case demonstrates that there presently exists in the Pinellas County area three American Osteopathic Association accredited facilities, one of which is located in 7 North Pinellas County and is actively engaged in the training of osteopathic graduates. Another facility located 25 minutes to the north of the applicants' proposed site has committed itself to become a teaching hospital affiliated with the Southeastern College of Osteopathic Medicine. Petitioners have failed to establish the need for additional educational facilities for the training of doctors of osteopathy in the community. Indeed, it was demonstrated that if the proposed facility were built, the attempts of Riverside Hospital to become an osteopathic teaching hospital could well be damaged.
Among the considerations to be given to proposals for the provision of new health services to inpatients is the availability of less costly, more efficient or more appropriate alternatives to such inpatient services. Sun Coast Hospital is presently underutilized and there is no evidence that Riverside Hospital does not have available resources to serve the patients or doctors residing in the applicants' proposed service area. The utilization of existing osteopathic hospitals would certainly be less costly and more efficient than the ten million dollar construction of a new facility.
Mease Hospital and Clinic, which currently holds a Certificate of Need to construct a new 100-bed hospital within two and one half miles from the petitioners' proposed facility, has clearly demonstrated its standing to intervene in this proceeding. While Mease is not an osteopathic facility by any definition, it does have eight doctors of osteopathy on its staff, two of whom are expected to staff the new facility's emergency room. The opening of an osteopathic facility within two and one half miles would affect the financial feasibility of the new Mease facility and would affect its ability to secure staff and personnel at the new facility.
Petitioners having failed to demonstrate that their proposal for a new osteopathic hospital meets the criteria for review set forth in either subsection (2) or (6) of Section 381.494, Florida Statutes, petitioners are not entitled to a Certificate of Need for such a facility.
RECOMMENDATION
Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that the application of Sun Coast/Metropolitan General Hospital for a Certificate of Need to construct an 86-bed acute care osteopathic hospital in North Pinellas County be DENIED.
Respectfully submitted and entered this 29th day of June, 1983, in Tallahassee, Florida.
DIANE D. TREMOR
Hearing Officer
Division of Administrative Hearings The Oakland Building
2009 Apalachee Parkway
Tallahassee, Florida 32301
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 29th day of June, 1983.
COPIES FURNISHED:
Cynthia S. Tunnicliff, Esquire Carlton, Fields, Ward, Emmanuel,
Smith & Cutler, P.A.
P.O. Drawer 190 Tallahassee, Florida 32302
Robert A. Weiss, Esquire Department of Health and
Rehabilitative Services 1323 Winewood Blvd.
Tallahassee, Florida 32301
John P. Frazer, Esquire Frazer & Hubbard, P.A.
P.O. Box 1178
Dunedin, Florida 33528-1178
Kenneth Hoffman, Esquire Oertel & Hoffman, P.A.
646 Lewis State Bank Bldg. Tallahassee, Florida 32301-1879
David Pingree Secretary
Department of Health and Rehabilitative Services
1323 Winewood Blvd.
Tallahassee, Florida 32301
Docket for Case No: 82-001746
Orders for Case No: 82-001746
| Issue Date |
Document |
Summary |
|
Jun. 29, 1983 |
Recommended Order
|
Petitioner was not entitled to Certificate of Need (CON) because it did not show need and permitting it would be inefficient as competing hospital just permitted.
|
