Judges: WILLIAM E. WILLIAMS
Agency: Agency for Health Care Administration
Latest Update: Jan. 04, 1984
Summary: Applicant for Certificate of Need (CON) approved to have application reviewed concurrently with competing application despite two-day lateness of the application.
83-2922STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
PORT ORANGE GENERAL )
HOSPITAL, INC., )
)
Petitioner, )
)
vs. ) CASE NO. 83-2922
)
DEPARTMENT OF HEALTH AND )
REHABILITATIVE SERVICES, )
)
Respondent. )
)
RECOMMENDED ORDER
Pursuant to notice, a formal administrative hearing was held before William
Williams, Hearing Officer of the Division of Administrative Hearings, on October 13, 1983, in Tallahassee, Florida. The issue for determination in this proceeding is whether Petitioner's application for a Certificate of Need to construct and operate a 100-bed acute-care hospital in Volusia County should be considered by the Department of Health and Rehabilitative Services (DHRS) in the August 15, 1983, batching cycle.
APPEARANCES
For Petitioner: Robert A. Weiss, Esquire, and
Philip Blank, Esquire
241 East Virginia Street Tallahassee, Florida 32301
Ronald L. Book, Esquire AmeriFirst Building, 30th Floor One Southeast Third Avenue Miami, Florida 33131
For Respondent: Frank Olsavsky, Legal Intern
Department of Health and Rehabilitative Services 1317 Winewood Boulevard
Tallahassee, Florida 32301 INTRODUCTION
Pursuant to Section 120.57(1), Florida Statutes (1981) Petitioner requested a formal administrative hearing to contest DHRS's determination that Petitioner not be allowed to file an application for a Certificate of Need in the August 15, 1983, batching cycle. Petitioner maintains its August 15, 1983, Certificate of Need application should be reviewed on a comparative basis with the application filed by Halifax Hospital Medical Center.
In support of its position, Petitioner presented the testimony of Thomas F. Porter, the Medical Facilities Consulting Supervisor for DHRS; Thomas J. Konrad, former Administrator of the Office of Community Medical Facilities, DHRS; and Earl Treadway, Vice President of Governmental Relations for the Florida Hospital Association. Petitioner's Exhibits 1 through 4 were received into evidence.
DHRS presented the testimony of Eugene Nelson, present Administrator of the Office of Community Medical Facilities for DHRS. DHRS's Exhibit 1 was received into evidence.
Subsequent to the hearing, all Parties filed proposed findings of fact and conclusions of law. Each party's proposed findings of fact have been considered and, where appropriate, adopted in substance. Those findings not adopted are considered to be subordinate, cumulative, immaterial, unnecessary, or not supported by the evidence.
FINDINGS OF FACT
On July 18, 1983, Petitioner, under its former corporate name, Deltona General Hospital, Inc., filed a letter pursuant to Rule 10-5.08, Florida Administrative Code, advising DHRS of its intention to file an application for a Certificate of Need to construct and operate a 100-bed acute-care hospital in Volusia County. The letter identifies the nature and scope of the project, the project's location, and the date upon which the application is to be filed.
On July 18, 1983, Petitioner advised be Health Planning Council of Northeast Florida of its intention to file an application for a Certificate of Need to construct and operate a 100-bed acute-care hospital in Volusia County. Oral notice was provided by Western Union Mailgram on July 18, 1983. Written confirmation of the mailgram, was received by the Health Planning Council of Northeast Florida on July 20, 1983.
On July 18, 1983, Halifax Hospital Medical Center filed a competing letter of intent to establish a 100-bed acute-care general hospital in Volusia County.
On August 15, 1983, both Petitioner and Halifax Hospital Medical Center filed applications for a Certificate of Need to construct a 100-bed acute-care hospital in Volusia County.
On or about September 9, 1983, Petitioner was advised in a letter from Thomas F. Porter, Supervisor, Medical Facility Consultants, DHRS, that its August 19 application would not be reviewed in the August 19 acute-care batching cycle. DHRS rejected the application due to Petitioner's failure to file a written letter of intent with the local health council on or before July 15, 1983, predicating its decision on Rule 10-5.08 (1)(b), Florida Administrative Code.
The application of Halifax Hospital Medical Center will be reviewed by DHRS in the August 15, 1983, batching cycle.
Committee Substitute for House Bill 700, effective July 1, 1983, and codified into law at Chapter 83-244, Laws of Florida, amended Section 381.494(5), Florida Statutes, to require DHRS to "provide a mechanism by which providers may enter a batching cycle to compete with all letters of intent filed."
DHRS has not, as of this date, developed a mechanism in compliance with this statutory amendment.
In 1952, Rule 10-5.08, Florida Administrative Code, provided in pertinent part:
In order that applications pertaining to similar types of services, facilties, or equipment affecting the sense health service area may be considered in relation to each other for purposes of
competitive review, letters of intent and applications shall be submitted
to the appropriate HSA in the Department pursuant to dates prescribed and application schedules (attachments
1-9) developed under the following conditions:
(e) In cases where a letter of intent was filed within five working days of the letter of intent dead-
line, a grace period of ten days from the deadline date for receipt of intent, shall be established
to provide an opportunity for a competing applicant to file a letter of
intent.
As amended on March 31, 1952, Rule 10-5.08(1)(b) provides, in pertinent part:
(b) At least 30 days prior to
the filing of an application, a letter of intent respecting the development
of a proposal must be actually received by the local health council and by the Department . . . because letters of intent give applicants a right of entry into the Certificate of Need process, failure to file a timely letter of intent and to have it actually received by the Department and by the local health council at least 30 days prior to the filing of an application will prevent the Department from accepting an application. Failure to timely
file a letter of intent or to timely file an application will cause a delay in a Certificate of Need project until the next available review cycle.
Section 381.494(5), Florida Statutes, is cited in the Florida Administrative Code as the specific authority for Rule 10-5.08. In addition, Section 381.494(5), Florida Statutes, is cited as the law implemented by Rule 10-5.08.
During the 1983 legislative session, a number of groups and individuals recommenced that Section 381.494(5), Florida Statutes, be amended to include a grace period provision. Hot DHRS and the Florida Hospital Association supported the requested legislative amendment. The 1983 Legislature in fact amended Section 381.494(5), Florida Statutes, to require DHRS to provide a "mechanism by which providers may enter a batching cycle to compete with all letters of intent filed. Chapter 83-244, Laws of Florida. The amended statute became effective July 1, 1983.
DHRS has yet to initiate formal rule-making proceedings under Chapter 120, Florida Statutes, to amend Rule 10-5.08(1)(b) Florida Administrative Code. The amount of time required to develop and adopt an amended version of Rule 10- 5.08, supra, is uncertain.
Section 381.494(5), Florida Statutes, as amended, does not specifically require that DHRS promulgate or amend its rule. The statute merely directs DHRS to provide a "mechanism" by which providers may enter a batching cycle to compete with all letters of intent filed.
The filing of a letter of intent with the local health councils serves an informational purpose. The letter of intent process gives notice to the community at large as to what particular applications may be submitted during the various batching cycles.
The filing of a letter of intent does not trigger any review process at the local level. The local health council does not participate in project review during the Certificate of Need process. The purpose of the letter of intent is simply to put other institutions or interested individuals in the area on notice of the potential for filing of an application at a later date.
The Halifax Hospital Medical Center Certificate of deed application is being reviewed in the August 15 batching cycle without reference to any other applications. If Petitioner's application is accepted, it will be reviewed competitively with the Halifax application.
There is no evidence of record in this cause to demonstrate that DHRS, Halifax Hospital Medical Center, or any other potentially competitive health care provider was misled or in any way prejudiced by Petitioner's having filed its letter of intent on July 20, 1983, instead of July 18, 1983. Further, there is no evidence to suggest that the interest of the public in containing health care costs and avoiding the unnecessary duplication of health services will not best be served by a competitive review of Petitioner's proposed project and that of Halifax Hospital Medical Center. Finally, there are no facts of record, other than those outlined above, to establish what the agency's policy should be in light of the aforementioned 1983 legislative amendments.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, this proceeding. Section 120.57(1), Florida Statutes.
The 1983 Florida Legislature amended Section 381.494(5), Florida Statutes, to require DHRS to "provide a mechanism by which providers may enter a batching cycle to compete with all letters of intent filed." DHRS is required to provide such a mechanism, notwithstanding both the statutory and rule
requirement that a letter of intent respecting the development of a proposed health care facility must be actually received by both DHRS and the local health council at least 30 days prior to the filing of an application. As indicated above, DHRS has not promulgated a rule in response to the action of the 1983 Legislature, nor, under the facts of this case, is it required to do so. See, City of Plant City v. Mayo, 337 So.2d, 966, 974-975 (Fla. 1976). Instead, DHRS is free to develop its policy in this regard by ad hoc adjudication in order to respond to that legislative mandate. McDonald v. Department, of Banking and Finance, 346 So.2d 569 (Fla. 1st DC 1977). The 30-day requirement contained in both Section 381.494(5), Florida Statutes, and Rule 10-5.08(1)(b) Florida Administrative Code, must be construed in light of the aforementioned 1983 legislative amendments and the declaration of legislative intent contained in Section 381.493(1), Florida Statutes, concerning the desirability of strengthening competitive forces in the health services industry and eliminating unnecessary duplication of health services. Taking these factors into consideration, it is specifically concluded as a matter of law that the 1983 legislative amendments to Section 381.494(5), Florida Statutes, require DHRS to afford an opportunity for a health care applicant to enter a batching cycle to compete with all competing letters of intent filed therein within a reasonable time after the deadline date for receipt of letters of intent. DHRS, as indicated above, is free to develop its policy in this regard on a case-by-case basis. Under the circumstances involved in this case, it is specifically concluded that Petitioner should be allowed to have its application reviewed in the August 15, 1983, batching cycle, notwithstanding its having filed its letter of intent with the local health council on July 20, 1983. When viewed in light of the 1983 legislative amendments to Section 381.494(5), Florida Statutes, it is concluded that the prescriptions contained in Rule 10-5.08(1)(b), Florida Administrative Code, are not applicable herein.
Accordingly, based upon the foregoing Findings of Fact and Conclusions of Law, it is
RECOMMENDED:
That a final order be entered by the State of Florida, Department of Health and Rehabilitative Services, requiring that Petitioner's Certificate of Need application be reviewed in the August 15, 1983, batching cycle.
DONE AND ENTERED this 14th day of November, 1983, in Tallahassee, Leon County, Florida.
WILLIAM E. WILLIAMS
Hearing Officer
Division of Administrative Hearings Department of Administration
2009 Apalachee Parkway
Tallahassee, Florida 32301
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 14th day of November, 1983.
COPIES FURNISHED:
Robert A. Weiss, Esquire
F. Philip Blank, Esquire
241 East Virginia Street Tallahassee, Florida 32301
Ronald L. Book, Esquire AmeriFirst Building 30th Floor One Southeast Third Avenue Miami, Florida 33131
Frank Olsavsky, Legal Intern Department of Health and
Rehabilitative Services 1317 Winewood Boulevard
Tallahassee, Florida 32301
Mr. David Pingree Secretary
Department of Health and Rehabilitative Services
1323 Winewood Boulevard
Tallahassee, Florida 32301
Docket for Case No: 83-002922
Orders for Case No: 83-002922
| Issue Date |
Document |
Summary |
|
Dec. 30, 1983 |
Agency Final Order
|
|
|
Nov. 14, 1983 |
Recommended Order
|
Applicant for Certificate of Need (CON) approved to have application reviewed concurrently with competing application despite two-day lateness of the application.
|
