STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

HOME HEALTH PROFESSIONAL )

SERVICES, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 83-0230

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a hearing was held in this case before Arnold H. Pollock, a Hearing Officer with the Division of Administrative Hearings, in Leesburg, Florida, on December 30, 1983. The issue for consideration was whether Petitioner should be issued a license to expand its service into two additional counties.

APPEARANCES

For Petitioner: Thomas K. Riden, Esquire

Robert Johnson, Esquire 5656 Central Avenue

St. Petersburg, Florida 33707

For Respondent: Jonathan S. Grout, Esquire

Department of Health and Rehabilitative Services

Post Office Box 210 Jacksonville, Florida 32231

BACKGROUND INFORMATION

On October 19, 1982, Petitioner, Home Health Professional Services, Inc. (HHPS), submitted an an application for licensure to expand its service into Citrus and Marion Counties to Respondent, Department of Health and Rehabilitative Services (HRS), Office of Licensure and Certification. That application was received by Respondent on October 21, 1982, and was forwarded to Respondent's Office of Community Medical Facilities for a determination of Certificate of need requirements. Before that question was answered, Petitioner submitted a corrected application on October 29, 1982, which was also forwarded. On November 29, 1982, the Director, Office of Licensure and Certification, HRS, by certified mail, notified Petitioner that its application to expand into the two additional counties was denied. Petitioner, by letter dated December 22, 1982, requested this hearing.

At the hearing, Petitioner presented the testimony of Verla L. Heffrin and Petitioner's Exhibits 1 through 23. Respondent presented the testimony of Nat

1. Ward, Jr., and Respondent's Exhibit A.

   
   

   FINDINGS OF FACT

   
   

   1. In the latter part of 1976, Petitioner, chartered in Florida as a corporation on October 23, 1975, applied for licensure as a home health agency to the Office of Licensure and Certification, HRS, under the 1975 edition of Florida Statutes.

      
      

   2. Petitioner's application, which referred only to lake and Sumter Counties, was referred to the North Central Florida Planning Council (NCFPC), which, at that time, had the responsibility to evaluate the application and issue, if appropriate, a statement of need.

      
      

   3. Both the Project Review Committee and the Executive Committee of NCFPC reviewed Petitioner's application and recommended a positive statement of need for this project to be established in Lake and Sumter Counties.

      
      

   4. As a result of those findings and recommendations, and after a public hearing on the matter was held by NCFPC on December 28, 1976, HRS issued License No. 51 to Petitioner on February 14, 1977, to operate a home health agency in Lake and Sumter Counties. The license to operate in Lake and Sumter Counties was renewed annually up to and including the issuance of License No. 1291 by HRS on January 6, 1981, for the period February 1, 1983, through January 31, 1984.

      
      

   5. On October 29, 1982 Petitioner submitted an application for licensure to operate a home health care program in Citrus and Marion Counties in addition to Lake and Sumter Counties. This change would entail the expansion of geographical area serviced by Petitioner's employees, but would not result in a major increase in either employed personnel or equipment. Only one additional nurse and one additional vehicle would need to be added to Petitioner's operation to serve the expanded area. However, no new office space or equipment would be needed, as Petitioner would continue to operate existing office in Leesburg. The current director of Petitioner's operations, before submitting the expanded license application, spoke with a representative of HRS's Office of Licensure and Certification, Mr. John Adams, and was advised that all that was required was the submission of the application and the fee. Both were submitted, but the application was denied because there was no Certificate of Need issued for the establishment of a new subunit, as required, in the opinion of Respondent, by currently existing rules and statutes. The application submitted, at paragraph 10, listed four "subunits." The term "subunit" is contained only in the printed language of the form, as was the term "parent agency," and neither was used by Petitioner in its description of its operation.

      
      

   6. Petitioner is a privately owned corporation with a board of directors and corporate officers. It gets referrals from doctors and hospitals in the area for all four counties, but, because of the limitations on its license, can operate only in Lake and Sumter counties. It provides home nursing and various other therapies in several disciplines to individuals in their own residence. According to several physicians in the area, the service rendered by Petitioner is a necessary and, at times, critical portion of their patients' total care and treatment. It is reliable and efficient.

      
      

   7. At present, all nurses and other personnel report to the Petitioner's office in Leesburg each morning to receive patient assignments before going out

      to make their visits at the patients' homes. They return to the office in Leesburg at the close of the day, if necessary. The same procedure would be followed if the service were to be expanded into the two additional counties. No new office would be created, nor would anything change except the

      Petitioner's nurses, and other personnel would have farther to travel from their one office and base of operations.

      
      

   8. Under the circumstances, and as stipulated to by the parties, Petitioner's proposal does not constitute the establishment of either an autonomous or semiautonomous subunit, nor is the geographic expansion of service a substantial change in health services as defined by Florida Statutes.

      
      

   9. In a position paper dated February 28, 1983, the NCFPC recognized the existence of a problem in that while an existing home health agency can add new counties to its area of service with a Certificate of Need (CON) if it does not establish a new agency or subunits of the parent agency, and while physical subunits cannot be established without a CON, each of these rules fails to be consistent with the overall goals of planning and regulating health services and facilities, and together they constitute a contradiction and unreasonable set of rules for the home health industry. The agency's recommendations were: (1) A CON should be required prior to the addition of new counties to the service area of any licensed home health agency; (2) CONS should not be required for activities which do not involve substantial changes of services, increased service, or major capital expenditure and (3) CON's should be required for autonomous subunits.

      
      

   10. On March 9, 1982, James Barclay, an attorney with HRS, issued a written opinion for the agency (HRS) that a CON is not required before a Florida home health agency already licensed to operate within certain counties in a health service area may provide home health services to additional counties within the same health service area. Citrus and Marion Counties, into which Petitioner intends to go, are within the same health service area as Lake and Sumter Counties.

       
       

   11. Approximately one month after Mr. Barclay's opinion was issued, Mr. Gary J. Clarke, Deputy Assistant Secretary for Health Planning and Development for HRS, in a letter to all Health Service Area Directors, affirmed the position that an agency could provide services in counties when it was not previously providing services in the same health service area so long as there were no establishment of subunits or capital expenditures.

       
       

       CONCLUSIONS OF LAW

       
       

   12. The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of the proceeding.

       
       

   13. Chapter 400, Part III, Florida Statutes (1981), deals with home health agencies, and Section 400.471 thereof deals with application for licensure. A Subparagraph (3), the statute states:

       
       

       (3) The department shall not issue a license to a home health agency which fails to receive a certificate of need under the provisions of ss. 381.493-381.497.

       
       

       What is not specifically stated here, but clearly implied, is that this subparagraph applies if the CON is required, and under Chapter 381, Florida

       Statutes (1981), HRS cannot issue a license to a home health agency unless it has received a CON. In that regard, however, home health agencies which were operational prior to the enactment of the CON law were "grandfathered" in and do not need CONs to operate unaltered.

       
       

   14. At the time Petitioner was first licensed in 1977, the statute in effect required that, prior to licensure, the applicant secure a statement of need from the health planning agency which performed the function then instead of HRS. This was done when Petitioner secured a statement of need from the NCFC to the effect that its services were needed in Lake and Sumter Counties at that time. It is not significant that the statement of need related only to Lake and Sumter Counties because those were the only counties requested by Petitioner at the time.

       
       

   15. The parties have agreed that the circumstances proposed in this case do not constitute the creation of an autonomous or semiautonomous subunit of the parent agency. The parties also agree that geographic expansion of a service is not a substantial change in health services as defined in Section 381.493, Florida Statutes, and Chapter 10-5.02(19), Florida Administrative Code. The sole question remaining then is whether what Petitioner proposes constitutes the establishment of a new home health agency so as to require CON approval.

       
       

   16. Mr. Barclay, Respondent's attorney, has concluded it does not, and this position was affirmed by another senior official of Respondent agency. No evidence has been presented to indicate a differently. Clearly, expanding service by Petitioner into two different counties without the establishment of additional autonomous operational entities as defined by Section 10-5.02(27) Florida Administrative Code, does not create a new agency so as to require operation of the CON process.

       
       

   17. It well may be that CON evaluation would be advantageous to ensure there is, in fact, a proper expansion of service. However, that action is not, now, required.

       
       

   18. The Respondent has submitted a Memorandum and Proposed Recommended Order which includes proposed findings of fact and conclusions of law. The proposed findings and conclusions have been adopted only to the extent that they are expressly set out in the Findings of Fact and Conclusions of Law above.

They have been otherwise rejected as contrary to the better weight of the evidence, not supported by the evidence, irrelevant to the issues, or legally erroneous.

RECOMMENDATION

Based on the foregoing, it is RECOMMENDED

The Petitioner, Home Health Professional Services, Inc., be issued a license to operate in Marion and Citrus Counties.

RECOMMENDED this 25th day of January, 1984, in Tallahassee, Florida.

ARNOLD H. POLLOCK, 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 25th day of January, 1984.

COPIES FURNISHED:

Thomas K. Riden, Esquire Robert Johnson, Esquire 5656 Central Avenue

St. Petersburg, Florida 33707

Jonathan S. Grout, Esquire Department of Health and Rehabilitative Services Post Office Box 210 Jacksonville, Florida 32231

Mr. David Pingree, Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32201

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AGENCY FINAL ORDER

=================================================================

STATE OF FLORIDA

DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES

HOME HEALTH PROFESSIONAL SERVICES, INC.,

Petitioner,

vs. CASE NO. 83-230

DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES,

Respondent.

/

FINAL ORDER

This cause came on before me for the purpose of issuing a final agency order. The hearing officer assigned by the Division of Administrative Hearings (DOAH) in the above-styled case has submitted a Recommended Order to the Department of Health and Rehabilitative Services (HRS). A copy of that Recommended Order is attached hereto.

(A) OPLC - meaning HRS Office of Licensure and Certification - filed Exceptions to the Recommended Order. A copy of OPDC's Exceptions is attached hereto as Exhibit A.

HRS STATEMENT AND RULING ON THE EXCEPTIONS

(AA) OPLC Exception (1) - The Exception is sustained. Paragraph (2) under the Conclusions of Law is modified by deleting the last sentence and adding:

"Section 400.504, Florida Statutes (F.S.) provides for the grandfathering of home health agencies from the Certificate of Need (CON) requirement but only under prescribed conditions. There are no factual findings in this case which establish that the Petitioner is grandfathered or exempt from CON requirement in respect to expanding its license to include Citrus and Marion Counties.

(AA) OPLC Exception (2) - The Exception is sustained. Paragraphs (5) and

1. of the Conclusions of Law modified to read as follows:

   
   

   1. Although Petitioner's proposal to expand its service area is not its first time operation as a home health service agency, the

      proposed expansion is the first instance of an operation in Citrus and Marion Counties. The proposed expansion amounts to the "establishment of a new home health agency" reviewable under sections 381.494(1) and 400.471(3), F.S. Before HRS can allow the Petitioner to expand its services into a county for which it has not been previously licensed, Petitioner must first obtain CON review or an exemption issued by HRS Office of Community Medical Facilities.

      
      

   2. The factual findings made herein support denial of Petitioner's request to expand its license into Citrus and Marion Counties. Petitioner has received neither Statement of Need review for the counties nor an exemption therefrom. The only Statement of Need issued to the Petitioner under prior law, namely section 400.471(3), F.S. (1975), was based upon positive recommendations relative to Lake and Sumter Counties. Said Statement of Need is insufficient to exempt the Petitioner from CON requirement for Citrus and Marion Counties required by sections 381.494(1)(f) and 400.471(3), F.S. (1981).

FINDINGS OF FACT

The Department hereby adopts and incorporates the overall findings of fact made by the Hearing Officer.

CONCLUSIONS OF LAW

The conclusions of law stated by the Hearing Officer are rejected. The conclusions amount to an erroneous or otherwise inappropriate interpretation and application of law. The correct interpretation and application, which compel a different result, is set out in HRS Statement and Ruling on the Exceptions.

Consequently,

It is ADJUDGED that the Petitioner's request to expand its home health services into Citrus and Marion Counties is denied.

ORDERED this 14th day of March, 1984, in Tallahassee, Florida.

COPIES FURNISHED:

Thomas K. Riden, Esquire

and Robert Johnson, Esquire 5656 Central Avenue

St. Petersburg, Florida 33707

DAVID H. PINGREE

Secretary

Jonathan S. Grout, Esquire Department of HRS

P.O. Box 210

Jacksonville, Florida 32231

Arnold H. Pollock Hearing Officer

Division of Administrative Hearings 2009 Apalachee Pkwy.

Tallahassee, Florida 32301

Harden King, Agency Clerk Department of HRS

1323 Winewood Blvd.

Suite 406

Tallahassee, Florida 32301

Docket for Case No: 83-000230

Orders for Case No: 83-000230