STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

HEALTH CARE ASSOCIATES (Polk )

County Nursing Home), )

)

Petitioner, )

)

vs. ) CASE NO. 83-819

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent. )

) BEENE, TAYLOR & WHITCOMB,d/b/a ) QUALITY CARE CENTER OF LAKELAND, )

)

Petitioner, )

)

vs. ) CASE NO. 83-943

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent. )

) QUALITY HEALTH FACILITIES, INC., ) d/b/a HAINES CITY HEALTH CARE, )

)

Petitioner, )

)

vs. ) CASE NO. 83-1276

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice the Division of Administrative Hearings by its duly designated Hearing Officer, K. N. Ayers, held a consolidated public hearing in the above styled cases on July 29, 1983 at Haines City, Florida.

APPEARANCES

For Health Care Associates: Karen Goldsmith, Esquire

Post Office Box 1980 Orlando, Florida 32802

For Quality Care Center: John P. Parks, Esquire

Post Office Box 5378 Lakeland, Florida 33803

For Quality Health Paul L. Gunn, Esquire

Facilities, Inc.: Post Office Box 22966 Jackson, Mississippi 39205

For Department of Health Jay Adams, Esquire and and Rehabilitative Claire Dryfuss, Esquire

Services: Department of Health and Rehabilitative Services

1323 Winewood Boulevard Building One, Suite 406 Tallahassee, Florida 32301

By petitions (or Requests for Administrative Hearings) filed February 25, 1983, March 9, 1983, and March 30, 1983 respectively, the above styled Petitioners requested administrative hearings to contest the Department of Health and Rehabilitative Services' (DHRS) denial of their applications for certificates of need to construct and operate nursing homes in Polk County, Florida.

At the commencement of the hearing, Petitioner Health Care Associates' renewed Motion for Continuance was again denied, having previously been denied in a telephone conference call with all parties on July 27, 1983. Following that denial Petitioner, Quality Care Center of Lakeland, voluntarily dismissed its petition for hearing and was excused from further participation in these proceedings. Thereafter each remaining Petitioner called one witness, one witness was called by DHRS and ten exhibits were admitted into evidence.

The parties' proposed findings of fact, to the extent they are incorporated herein are adopted; otherwise they are rejected as unsupported by the evidence, unnecessary to resolution of the issues, or a mere recitation of testimony presented at the hearing.

FINDINGS OF FACT

1. Under the methodology in effect at the time these applications were submitted there were 74 beds available in the Polk County area according to the 1982 Health Systems Plan of the now defunct South Central Florida Health Systems Council. Based upon this plan, and without further study of the need for additional nursing home beds, Petitioner Haines City Health Care Center on October 14, 1982 filed an application for a certificate of need to add 72 beds to a nursing home under construction in Haines City, Florida (Exhibit 1) and Petitioner, Health Care Associates, on October 15, 1982, filed an application for a certificate of need to construct a 120-bed skilled nursing home in Lakeland, Florida (Exhibit 3). This was amended to request a certificate of need to construct a 74-bed nursing home.

   
   

2. Effective November 15, 1982 Chapter 10-5, Florida Administrative Code was amended and Rule 10-5.11(21)(b) established a new methodology for determining need for nursing home beds in both the regions and the sub-regions. Using this methodology and counting the beds approved but not yet in service, DHRS found an excess of 517 nursing home beds in Polk County through 1985 in lieu of the 74 additional beds reported as needed in the Health Systems Plan. (Exhibit 6).

3. Projecting the need to 1986 and using the methodology of Rule 10- 5.11(21)(b), Florida Administrative Code and counting those beds approved but not yet licensed results in an excess of of 367 beds in Polk County and an excess of 464 beds districtwide (T p.79).

   
   

4. Both Petitioners presented testimony indicating they are experienced nursing home operators and capable of operating nursing homes. Although no specific cost figures were presented to support the testimony of either Petitioner that it would be a cost effective operator, it is obvious, but not here relevant, that it would be less expensive per bed to add beds to the facility under construction at Haines City than to acquire property and construct a new facility at Lakeland. Exhibit 1 reflects costs of $1,250,000 for the 72 bed addition at Haines City while Exhibit 3 reflects costs of

   $2,738,000 for a new 120-bed nursing home at Lakeland.

   
   

5. No competent evidence was submitted by either Petitioner to establish a need for any additional nursing home beds. Petitioner's Quality Health Facilities, Inc., witness acknowledged no study had been done by his organization to demonstrate a need for additional beds in Polk County, while Petitioner's Health Care Associates, witness relied upon his expertise in operating nursing homes in Florida and general observations of the population growth to conclude additional nursing home beds could be utilized. No statistical information was submitted to support this bare opinion.

   
   

   CONCLUSIONS OF LAW

   
   

6. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings.

   
   

7. From the evidence presented not only was no need for additional nursing home beds in Polk County shown, but also the evidence was unrebutted that a substantial surplus of nursing home beds presently exists and an excess is projected through 1986.

   
   

8. Petitioner, Health Care Associates, in its proposed recommended order, urges great weight be given to the recommendations of the defunct Health Systems Agency that, under the 1982 Health Systems Plan which showed a need for 74 beds, these beds be awarded to Health Care Associates. Unfortunately for Petitioner that recommendation was predicated upon a methodology that had been discontinued before these applications were considered.

   
   

9. This Petitioner further contends that DHRS is estopped to deny this certificate under the doctrine of equitable estoppel. As authority for this claim of estoppel Petitioner cites Dept. of Revenue v. Anderson, 389 So.2d 1034 (Fla. 1st DCA 1980), and contends the facts here involved are similar to the facts in Anderson. Respondent failed to note that the Supreme Court of Florida reversed that decision in State Department of Revenue v. Anderson, 403 So.2d 39 (Fla. 1981). Therein the court reaffirmed the general rules that equitable estoppel will be applied against the State only in rare instances and under special circumstances, North American Co. v. Green, 120 So.2d 603 (Fla. 1959); that the State cannot be estopped through mistaken statements of the law, Dept. of Revenue v. Hobbs, 368 So.2d 367 (Fla. 1st DCA), appeal dismissed, 378 So.2d

   345 (Fla. 1979); and, in order to demonstrate estoppel the following elements must be shown: 1) a representation as to a material fact that is contrary to a later-asserted position; 2) reliance on that representation; and 3) a change in position detrimental to the party claiming estoppel, caused by the

   representation and reliance thereon, Greenhut Construction Co. v. Henry A. Knott, Inc., 247 So.2d 517 (Fla. 1st DCA 1971).

   
   

10. Filing an application for a certificate of need solely upon a statement in a health systems plan that there is a shortage of beds in a particular area, hardly constitutes the change of position envisioned in the application of the doctrine of equitable estoppel. Even if it were the State is not bound by the mistaken assertions in the health systems plan.

    
    

11. From the foregoing it is concluded that no need exists for additional nursing home beds in Polk County through 1986; that, to the contrary, an excess of 367 beds has been approved for Polk County and an excess of 464 beds has been approved in District VIII for this period; and that in view of the lack of any showing of need and the failure of both Petitioners to present cost data other than that contained in Exhibits 1 and 3, a comparison of the applicants for the purpose of recommending the best qualified to provide the proposed service, is not indicated.

It is

RECOMMENDED that the application of Health Care Associates, Quality Care Center of Lakeland, and Quality Health Facilities, Inc. be disapproved and these appeals dismissed.

ENTERED this 19th day of August, 1983 in Tallahassee, Florida.

K. N. AYERS, Hearing Officer

Division of Administrative Hearings 2009 Apalachee Parkway

Tallahassee, Florida 32301

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 19th day of August, 1983.

COPIES FURNISHED:

Karen Goldsmith, Esquire Dempsey & Slaughter, P.A. Post Office Box 1980 Orlando, Florida 32802

Paul L. Gunn, Esquire Law & McMullan

Suite 1530, Capitol Towers Post Office Box 22966 Jackson, Mississippi 39205

John P. Parks, Esquire Post Office Box 5378 Lakeland, Florida 33803

Jay Adams, Esquire Claire Dryfuss, Esquire Department of Health and

Rehabilitative Services Building 1, Suite 406

1323 Winewood Boulevard

Tallahassee, Florida 32301

David H. Pingree, Secretary Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32301

Docket for Case No: 83-000819

Orders for Case No: 83-000819