Judges: LINDA M. RIGOT
Agency: Agency for Health Care Administration
Latest Update: Apr. 16, 1985
Summary: Grant of Certificates of Need (CON) for cardiac catheterization labs and open heart surgery services where need shown and protestors lacked standing.
83-3485.PDFSTATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
NORTH RIDGE GENERAL HOSPITAL, INC., )
)
Petitioner, )
and )
)
PALM BEACH GARDENS MEDICAL CENTER ) and AMERICAN MEDICAL INTERNATIONAL, INC., )
)
Intervenors, )
)
v. ) CASE NO. 83-3485
) DELRAY COMMUNITY HOSPITAL, JFK HEALTH ) INSTITUTE, and DEPARTMENT OF HEALTH AND ) REHABILITATIVE SERVICES, )
)
Respondents. )
) PALM BEACH GARDENS MEDICAL CENTER and ) AMERICAN MEDICAL INTERNATIONAL, INC., )
)
Petitioners, )
and )
)
NME HOSPITALS, INC., d/b/a DELRAY ) COMMUNITY HOSPITAL; and NORTH RIDGE ) GENERAL HOSPITAL, INC., )
)
Intervenors, )
)
vs. ) CASE NO. 84-1523
) JFK HEALTH INSTITUTE, d/b/a JOHN F. ) KENNEDY MEMORIAL HOSPITAL and DEPARTMENT ) OF HEALTH AND REHABILITATIVE SERVICES, )
)
Respondents. )
)
RECOMMENDED ORDER
Pursuant to notice, this cause was heard by Linda M. Rigot, the assigned Hearing officer of the Division of Administrative Hearings, on May 8-10, 1984, in West Palm Beach, Florida.
Petitioner/Intervenor, North Ridge General Hospital, Inc., was represented by Richard M. Benton, Esquire, Tallahassee, Florida; Intervenors/Petitioners, Palm Beach Gardens Medical Center and American Medical International, Inc., were represented by Robert S. Cohen, Esquire, Tallahassee, Florida; Respondents/Intervenors, Delray Community Hospital and NME Hospitals, Inc., d/b/a Delray Community Hospital, were represented by C. Gary Williams, Esquire,
and Michael J. Glazer, Esquire, Tallahassee, Florida; Respondents JFK Health Institute and JFK Health Institute d/b/a John F. Kennedy Memorial Hospital were represented by Robert A. Weiss, Esquire, Tallahassee, Florida; and Respondent Department of Health and Rehabilitative Services was represented by John F. Gilroy, Tallahassee, Florida.
In June 1983, NME Hospitals, Inc. d/b/a Delray Community Hospital (hereinafter "Delray") filed an application for a Certificate of Need (hereinafter "CON") for a cardiac catheterization laboratory and open heart surgery service. During the same "batching cycle," JFK Health Institute (hereinafter "JFK/HI") filed an application for a cardiac catheterization laboratory at John F. Kennedy Memorial Hospital (hereinafter "JFK"). Both applications were initially approved by the Florida Department of Health and Rehabilitative Services (hereinafter "HRS"). North Ridge General Hospital, Inc. (hereinafter "North Ridge") requested a formal administrative hearing to contest both of those applications. (DOAH Case No. 83-3485). Palm Beach Gardens Medical Center and American Medical1 International, Inc. (hereinafter collectively referred to as "PBGMC") intervened in opposition to those CON applications. In November 1983, JFK filed an application for a CON for an open heart surgery service. That application was originally approved by HRS. PBGMC requested a formal administrative hearing to contest the granting of that CON. (DOAH Case No. 84-1523). North Ridge and Delray intervened in opposition to that JFK application. The two cases were consolidated for final hearing. Accordingly, the issues for determination herein are whether a CON should be issued to Delray for a cardiac catheterization laboratory and open heart surgery service; whether a CON should be issued to JFK/HI for a cardiac catheterization laboratory, and whether a CON should he issued to JFK for an open heart surgery service.
In their Joint Prehearing Stimulation, all parties agreed that each of the CON applications involved in these cases either satisfy the following criteria or such criteria are not applicable:
Section 381.484(6)(c)3, (7), (8)(except as
to availability of a cardiovascular surgeon),
(1) and (13), Florida Statutes.
Section 10-5.11(15)(g)1, 2, 3, 4, (h)2,
(i)1, 2, 3, 5c and (m), (o)(2), Florida Administrative Code.
Section 10-5.11(16)(c), (d)2, 3 and (e)1,
(except as to a cardiovascular surgeon)
(except as to a cardiovascular surgeon) and 5, (i), Florida Administrative Code.
Consequently, no recommended findings of fact or conclusions of law will be made as to those criteria.
Delray presented the testimony of Raymond E. Porter; Frank Tidikis; Robert Greene; Alan Lieberman, M.D.; Stephen Babic, M.D.; Michael Gallo; Ethel Evans, and Michael Lewis, M.D. Additionally, Delray's Exhibits numbered 1-16 were admitted in evidence.
JFK presented the testimony of Jack David Massimino; J. Midwall, M.D.; James K. Johnson; John D. Corbitt, Jr., M.D.; Robert Chait, M.D.; E. E. Funderburk, Jr., M.D.; Joel P. Gordon, M.D.; Carol Lundberg, and Bill Moses. Additionally, JFK's Exhibits numbered 1-6 were admitted in evidence.
Eugene Nelson testified on behalf of HRS.
North Ridge presented the testimony of Kevin Eugene Walsh, Jeanne Hurst, Norman Stein, and Thomas J. Konrad. Additionally, North Ridge's Exhibit numbered 2 was admitted in evidence.
PBGMC presented the testimony of Richard Faro, M.D.; James Whittle, M.D., and Jane Lobell.
Proposed recommended orders containing findings of fact have been submitted by all parties and have been considered in the preparation of this Recommended Order. When the parties' findings of fact were consistent with the weight of the credible evidence introduced at the final hearing, they were adopted and are reflected in this Recommended Order. To the extent that the findings were not consistent with the weight of the credible evidence, they have been either rejected, or when possible, modified to conform to the evidence. Additionally, proposed findings which were subordinate, cumulative, immaterial, or unnecessary have not been adopted.
FINDINGS OF FACT
In June 1983 Delray filed an application with HRS for a CON for a cardiac catheterization laboratory and open heart surgery service for its hospital in Delray, Palm Beach County, Florida. During the same batching cycle, JFK/HI filed an application for a CON to establish a cardiac catheterization laboratory on the campus of John F. Kennedy Memorial Hospital in Atlantis, Palm Beach County, Florida. The Delray application was reviewed as one application by HRS. In November 1983, and during a subsequent batching cycle, JFK filed an application for a CON to establish an open heart surgery program.
Delray Community Hospital is located in the Medical Center at Delray, the geographic center of the southern half of Palm Beach County. The Medical Center already does or will include a 160-bed acute care hospital (with a 51-bed addition in progress) a 120-bed skilled nursing facility, a 72-bed psychiatric hospital, a 60-bed rehabilitation hospital, an adult congregate living facility, medical office buildings and a shopping mall. Delray intends to perform coronary angioplasty in its cardiac catheterization laboratory. Delray is accredited by the Joint Commission on Accreditation of Hospitals.
JFK is a 333-bed acute care hospital located in Atlantis, Florida, adjacent to Lake Worth, Florida, in central Palm Beach County. It is accredited by the Joint Commission on Accreditation of Hospitals. The hospital presently offers a full range of acute care services, including blood banking and renal dialysis. HRS has recently approved the establishment of a cancer center, outpatient surgery center, and psychiatric unit at JFK.
PBGMC is an acute care hospital located in Palm Beach Gardens, the northern portion of Palm Beach County. The hospital offers cardiac catheterization and open heart surgery services. The great majority of PBGMC's cardiac patients reside in Martin County, northern Palm Beach County, Ft. Pierce, and Okeechobee.
Approximately 80 percent of JFK's patients reside in the communities of Lake Worth, West Palm Beach, and Lantana, all of which are in central Palm Beach County.
Delray's primary service area is located in the southern part of Palm Beach County and includes the City of De1ray, unincorporated Delray, sections of western Boynton Beach, and some sections of western Boca Raton. Approximately
75 percent of Delray's patients are drawn from its primary service area. Delray's service area is also described as that area of Palm Beach County between Hypoluxo Road and the Broward County line. JFK is north of Hypoluxo Road. Accordingly, the Delray primary service area does not overlap with the JFK Primary service area.
North Ridge is an acute care hospital located in Ft. Lauderdale, Broward County, Florida. The hospital offers cardiac catheterization and open heart surgery services. The general service area of the hospital is primarily north Broward County. The facility also draws patients from southern Palm Beach County.
North Ridge is located in HRS District Ten. Delray, JFK, and PBGMC, however, are located in HRS District Nine.
District Nine is comprised of the following counties: Palm Beach, Martin, Okeechobee, St. Lucie, and Indian River. The service area for cardiac catheterization services and for open heart surgery services consists of the entire service district. At the present time, the only cardiac catheterization laboratory and open heart surgery service in HRS District Nine are located at PBGMC.
In 1986, the Florida Bureau of Economic and Business Research projects that just over one million people will live in District Nine. Approximately 70 percent of the population of District Nine lives in Palm Beach County, and 30 percent lives in the four remaining counties to the north. Ninety percent of the population living within HRS District Nine live within 2 hours travel time, under average travel conditions, of Delray and JFK.
Section 10-5.11(15)(1), Florida Administrative Code, provides a formula for computing the number of cardiac catheterization laboratories needed in a District. A two-year planning horizon is used in determining need. In HRS District Nine, a 1981 statewide use rate is employed in the formula since there were no existing cardiac catheterization laboratories in the District in 1981. According to the need formula, there is a 1986 need for five cardiac catheterization laboratories in District Nine. Subtracting the one existing laboratory leaves a net need of four cardiac catheterization laboratories in the District.
The need formula for determining the number of open heart surgery programs in the District is found in Section 10-5.11(16)(h), Florida Administrative Code. A two-year planning horizon is used in computing the need for this service. In HRS District Nine, a 1981 statewide use rate is utilized in the formula because there were no open heart surgery programs in the District in 1981. According to this formula, there is a need in HRS District Nine for three open heart surgery programs, or a net need for two programs in the District.
Section 10-5.11(15)(o), Florida Administrative Code, provides that no additional cardiac catheterization laboratories shall be established in a service area unless the average number of procedures performed by existing laboratories is greater than six hundred. The PBGMC laboratory was established in 1982 and has yet to perform six hundred procedures on an annualized basis. Each expert health planner agreed that the applications at issue should be
granted, notwithstanding PBGMC's inability to meet the six hundred procedure standard at this time, in that:
the projected need for cardiac catheterization services in District Nine is overwhelming;
there has been significant growth in the number of procedures performed at PBGMC; based upon such growth, and PBGMC's own projections, it is likely that PBGMC will perform six hundred procedures in 1984;
PBGMC's laboratory) is still in a "start-up" phase; and
PBGMC expects minimal impact from the approval of these applications.
Section 10-5.11(16)(k), Florida Administrative Code, provides that no additional open heart surgery programs shall be established within a service area unless each existing open heart surgery program within the area is operating at and is expected to continue to operate at a minimum of 350 surgery cases per year. The PBGMC open heart surgery program was established in November, 1983, and has yet to perform 350 cases on an annual basis. The expert health planners agree that pending applications should be granted, nonetheless, in that;
the projected need for open heart surgery services in District Nine is overwhelming;
the PBGMC program just began operation;
PBGMC projects that it will reach the
350 procedures a year standard in its own application for open heart surgery services; and
the PBGMC program has experienced tremendous growth in utilization during its first several months of operation.
Historically, Palm Beach County residents needing cardiac catheterization and open heart surgery services have been referred to Broward County and Dade County hospitals. This referral pattern is not in the best interest of the patients, patients' families, or treating physicians. There is potential for danger, even death, to the patient in transport, the patient does not receive continuity in care from his/her primary physician, and psycho-social problems exist for patients and families.
While the cardiac catheterization laboratories and open heart surgery programs in Broward County may he within two hours' travel time of many of the residents of District Nine, it was demonstrated that it is neither reasonable nor economical for patients in District Nine to travel to Broward County for cardiac catheterization or open heart surgery.
It is the policy of JFK to admit all patients who demonstrate a need for service, and JFK participates fully in the Medicaid program. This policy will be consistent for cardiac catheterization and open heart surgery services at JFK. Delray is in the process and will obtain a Medicaid contract for indigent patients using cardiac catheterization and open heart surgery services
at Delray since Delray believes it has an obligation to provide such regional services to all in need.
Based on projected need and the intentions of JFK medical staff cardiologists and internists regarding utilization of the proposed cardiac catheterization laboratory, JFK will perform 300 cardiac catheterization procedures annually within its first three years of operation. Delray's financial projections for the cardiac catheterization laboratory were based on
520 procedures performed during the lab's first year of operation and 650 procedures during the lab's second year of operation. These projections are reasonable in light of the number of procedures needed according to the applicable need methodology and the number of cases presently being referred out of Palm Beach County by physicians using JFK and Delray.
The service costs for the proposed JFK laboratory and for the proposed Delray laboratory are comparable to the cost for such services at other facilities in the area.
Both Delray and JFK have the financial resources to provide capital for the proposed cardiac catheterization laboratories.
There have been significant advances in the technology regarding cardiac catheterizations. Catheterization is no longer simply a diagnostic tool, but can also be used in the emergency treatment of heart attack victims. However, to be effective, the catheterization service must be quickly available in a facility close to the patient. Further, more coronary angioplasty is being performed, a procedure that takes longer and reduces the capacity of cardiac catheterization laboratories. Approval of cardiac catheterization laboratories at Delray and at JFK should positively impact and help reduce mortality rates for cardiovascular diseases in District Nine.
Regional, or tertiary care, services should be located in the major metropolitan areas. In District Nine, Palm Beach County is the major population base, accounting for 70 percent of the District's population. It is not reasonable, from a planning perspective to establish an open heart surgery program in an area with a relatively small population base. Open heart surgery is a very sophisticated service, in relation to general acute care services. In order to operate a quality open heart surgery program, a hospital needs access to adequate resources relative to staff and other facility capabilities.
Delray already has a number of existing programs and departments in place which can economically be utilized with a catheterization lab and open heart surgery service. Delray has one operating room sized as a primary open heart surgery room and another room sized as a backup operating room for open heart surgery. In addition Delray has departments for nuclear medicine, respiratory therapy, physical therapy, and various types of imaging, which can be utilized in a cardiovascular program. Delray also can take advantage of national purchasing contracts through NME which should result in cost savings to the patients. In that the open heart surgery suite at JFK was constructed pursuant to JFK's recent expansion and renovation of its surgery department, any indirect overhead expense associated with the implementation of the JFK open heart surgery program is insignificant, as such costs are already being absorbed by the facility.
Based on projected need and the intentions of JFK medical staff cardiologists and internists regarding utilization of the proposed program, JFK will perform 200 open heart surgery procedures annually within the first three
years of operation. Delray has projected that it will perform 195 open heart surgeries during year one and 270 open heart surgery procedures during the second year of operation. These projections are reasonable in light of the number of procedures projected by the applicable need methodology described above and in light of the number of cases referred out of District Nine by physicians on staff at Delray and JFK.
JFK did not utilize Medicare DRG rates in preparing its pro forma statement of income and expense in that it sought to determine the feasibility of the utilization of the surgical suite to perform open heart surgery, rather than considering all costs and revenues associated with the patient's hospital stay. Although the hospital will be reimbursed by Medicare on a DRG basis, it is difficult to project accurately on that basis, as JFK's DRG rates have already changed three times in six months. The pro forma contained in JFK's application for a CON to establish open heart surgery services assumed DRG implementation. That pro forma, if projected forward to 1986, the year in which the service will be instituted, still shows the project to be financially feasible. On the other hand, Delray projected its expenses using the DRG rates although it has no contract obligating it to use those rates at the present time. Even so, by considering all directly related expenses, Delray has demonstrated that its cardiac cath lab and open heart surgery service would be financially feasible on an immediate and long-term basis. Delray's projected costs and charges are comparable to or lower than the charges established by other institutions in the service area. Likewise, the charges for open heart surgery at JFK will be comparable to charges established by similar institutions in the service area.
Both Delray and JFK have adequate capital resources to establish open heart surgery programs.
Neither Delray nor JFK should have any problem recruiting fully qualified cardiovascular surgeons based upon the overwhelming need for the programs, based upon the desirability of working and living in the Palm Beach County area, and based upon the recent experience of PBGMC, which hospital has just recently recruited a cardiovascular surgeon for its program.
Neither PBGMC nor North Ridge participate in the Medicaid program. Accordingly, the approval of open heart surgery programs (and cardiac catheterization laboratories) at Delray (which will obtain a Medicaid contract) and at JFK (which already has a Medicaid contract), will result in the availability of cardiac services to indigent and Medicaid patients in District Nine for the first time ever.
At the time of the final hearing, the open heart surgery service at PBGMC had been in operation less than six months. However, that service was experiencing rapid growth. The service areas of PBGMC and Delray for cardiac catheterization and open heart surgery do not overlap to any significant extent. Less than 3 percent of the PBGMC cath lab and open heart surgery patients come from the Delray service area. A cath lab and open heart surgery service at Delray will have no impact on the ability of PBGMC to obtain and maintain the minimum number of procedures required by the applicable rules.
Although PBGMC, located in northern Palm Beach County, may he impacted by JFK located in central Palm Beach County, the record is clear that most of PBGMC's cardiac patients reside in northern Palm Beach County - Stuart, Ft. Pierce, Okeechobee, and Belle Glade, all of which are located outside of Palm Beach County. Accordingly, PBGMC has become a primary provider of cardiac
services to the residents of the four counties in District Nine north of Palm Beach County. Therefore, the approval of open heart surgery programs (in addition to cardiac catheterization laboratories) at Delray and JFK will result in a highly appropriate locating of facilities according to health planning standards: Delray serving the residents of southern Palm Beach County, JFK serving the residents of central Palm Beach County, and PBGMC serving the residents of northern Palm Beach County and the four counties north of Palm Beach County. Moreover, the approval of all applications herein will result for the first time in cardiac services being reasonably and economically accessible to residents of District Nine.
Although North Ridge failed to prove any impact it would suffer from approval of the programs sought by JFK, it is likely that North Ridge will experience some loss of patients from south Palm Beach County if Delray opens a high-quality cardiac catheterization laboratory and open heart surgery program. However, it is not likely that Delray will immediately begin to serve 100 percent of the patients in south Palm Beach County requiring those services, and North Ridge can still continue to compete for those patients. Further, the only impact shown by North Ridge from the loss of patients from Palm Beach County is economic. More significantly, any financial losses that might be experienced by North Ridge can be more than offset by reducing some of its current expenses. During its last fiscal year, North Ridge paid over $11 million to related companies, including a $3.7 million management fee which was shown to be exorbitant. More than $4.5 million of the monies paid to related companies was not permitted by Medicare as reimbursable costs. It was also shown that North Ridge is overstaffed and is paying an excessive amount for supplies for its cardiac catheterization laboratory and open heart surgery program.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the subject matter hereof and the parties hereto. Section 120.57(1), Florida Statutes (1983).
The evidence in this cause clearly indicates that a need exists for cardiac catheterization laboratories and open heart surgery services at both Delray and JFK. The need methodologies as contained in Sections 10-5.11(15) and (16), Florida Administrative Code, project a net need for four cardiac catheterization laboratories and two open heart surgery programs in District Nine, projecting forward to 1986. The need for such services is evaluated on a district-wide basis. Historically, patients in District Nine have been required to seek such services outside of the District Nine service area, at risk to their physical and emotional well-being and that of their families due to the inconvenience of traveling away from their homes to seek medical treatment from someone who has never been their treating physician. No evidence was offered to justify continuation of such a situation. Moreover, the medically indigent residents of District Nine lack access to cardiac services. PBGMC, the only facility in the District offering such services, does not participate in the Medicaid program. On the other hand, JFK is a participant in the Medicaid program and Delray is taking steps to obtain a Medicaid contract. However, participation in the Medicaid program should be made a condition to the issuance of Delray's CON so that its "intentions" that are part of the record in this cause will be guaranteed. HRS, as the licensing body, and the patients in District Nine requiring cardiac services should be able to rely upon representations made by a provider in the course of a final hearing establishing its eligibility to receive a CON.
Notwithstanding the overwhelming need for open heart surgery services and cardiac catheterization in District Nine, as demonstrated by agency rule and confirmed by the record in this proceeding, Delray contended at the final hearing that the JFK open heart surgery application should be denied so as to "reserve" an open heart surgery program for a facility located in one of the four northern counties of District Nine. The record reflects, however, that PBGMC is serving the cardiac care needs for the northern county residents and, in fact, draws the "bulk" of its patients from the northern counties. Further, open heart surgery services are tertiary, or regional, in nature. It is customary for such services to be located in major metropolitan areas in order to afford access to specialized medical and technical staff. Further, facilities proposing to offer open heart surgery services must demonstrate significant facility capabilities as a condition to receiving a CON, which both Delray and JFK have amply done in this proceeding. Delray's argument ignores the fact that no hospital in the northern counties of District Nine has indicated an interest in or has submitted a letter of intent to apply for a CON for a cardiac catheterization laboratory or open heart surgery service. In view of the overwhelming need for services in District Nine at this time, Delray's argument that an applicant who meets statutory and rule criteria for obtaining a CON should be denied such a certificate in the hopes that some other qualified provider might at some unknown time apply for that certificate should be summarily rejected.
No evidence was offered to show that there exists any alternative, such as outpatient care and ambulatory or home care services, to the cardiac catheterization and open heart surgery services proposed by Delray and JFK.
No evidence was offered to show that there exists probable economies and improvements in service that may be derived from operation of joint, cooperative, or shared health resources.
The evidence clearly indicates that neither Delray nor JFK should anticipate any problem in obtaining cardiovascular surgeons for their open heart surgery programs or any other of the specialized staff needed for their cardiac programs.
Both Delray and JFK have demonstrated the immediate and long-term financial feasibility of both their proposed cardiac catheterization laboratories and their proposed open heart surgery programs. Both Delray and JFK have the financial capability to implement the projects at issue.
HRS has no prescribed format pursuant to which financial feasibility data must be presented by an applicant. In evaluating the long-term financial feasibility of a project, HRS seeks to assure that projections relative to project utilization are reasonable and that the project will generate sufficient revenues to offset operating expenses. HRS recognizes that the projects at issue have significant scope in terms of revenues and expenses generated and does not seek to scrutinize financial feasibility "down to the last nickel that may or may not be spent in the future." (Tr. 575-6) Even where a specific project does not demonstrate financial feasibility on a project-specific basis, the project may be feasible in light of other hospital operations which produce a positive cash flow to the facility. The record reflects that both Delray's and JFK's cardiac programs will he financially feasible. The projections regarding utilization of the program are reasonable, and the projected average revenue per procedure is consistent with average projected revenues at other facilities in the area.
At hearing, the reasonableness of the assumptions regarding deductions from revenue, as contained in the JFK open heart surgery program projected income and expense statement, was called into question. The primary concern related to JFK's failure to utilize the Medicare DRG rate in calculating the Medicare contractual allowance. JFK's chief financial officer testified that he chose not to employ the DRG rate because the rate relates to a patient's entire hospital stay, and he was trying to ascertain the feasibility of the project only as it related to utilization of the surgical suite for open heart surgery. Further, he believed the DRG rate to be an unreliable basis for projecting feasibility, as the facility's DRG rate has been extremely unstable since the inception of the DRG program. Additionally, the original pro forma relative to the JFK open heart surgery program employed DRG rates in calculating the Medicare contractual allowance and also demonstrated JFK's program to be financially feasible.
Section 381.494(6)(c)6., Florida Statutes (1983), addresses the need in the applicant's service district for special equipment and services which are not reasonably and economically accessible in adjoining areas. North Ridge contends that its cardiac catheterization laboratory and open heart surgery program are accessible to District Nine residents and that all applications at issue should therefore be denied. This contention ignores the fact that North Ridge is located hours away from many residents of District Nine, and there is no evidence to suggest any rational basis for a resident in the northern part of District Nine having to drive through three or four other counties for several hours in order to reach a facility in a different HRS health planning district. North Ridge is only reasonably accessible to some of the residents in the southern part of Palm Beach County, the southernmost county of District Nine. North Ridge's contention also ignores the uncontroverted evidence from the cardiologists who testified in this proceeding that it is not in the best medical or social interests of patients, their families, or their treating physicians to travel significant distances to secure cardiac services. Accordingly, the "special services" offered by North Ridge are not reasonably accessible to patients in District Nine.
Section 301.494(6)(c)11., Florida Statutes (1983), requires HRS, in reviewing CON applications, to consider the needs and circumstances of entities which provide a substantial portion of their services to indigents residing in adjacent service districts. This criterion appears to apply to such entities solely as applicants, because the statute does not specifically address impact on such facilities that may he occasioned by the introduction of a service into such adjacent service area. In other words, if an entity can demonstrate, as an applicant, that it intends to treat patients from outside its service district, the project may warrant approval even where no need for the project is demonstrated based on the characteristics of the population which reside within the service district.
It is axiomatic that North Ridge and PBGMC must demonstrate their standing in this proceeding. In order to have standing, these parties must prove that they are substantially affected by the applications of Delray and JFK. Agrico Chemical Co. v. Dept. of Environmental Regulation, 406 So.2d 478 (Fla. 2d Dist. 1981). To demonstrate standing, a party must prove (1) injury in fact of sufficient immediacy to entitle the party to a Section 120.57 hearing, and (2) the substantial injury is of a type or nature the proceeding is designed to protect. Agrico, supra. North Ridge is not a health care facility located in the same health service area as Delray and JFK and is therefore not an "affected person" within the meaning of Section 10-5.02(20), Florida Administrative Code. Further, the only impact North Ridge has demonstrated is economic in nature
which is not within the zone of interest to be protected by this proceeding. Lastly, no criteria in Sections 10-5.11(15) or (16) Florida Administrative Code, require the consideration of any effect on facilities outside the service district in the consideration of whether or not to approve an application for a CON for cardiac catheterization laboratories or for open heart surgery programs. Accordingly, it is concluded that North Ridge does not have standing in this proceeding.
As a health care facility located in District Nine which provides cardiac catheterization and open heart surgery services, PBGMC has demonstrated that it is an "affected person" within the meaning of Section 105.02(20), Florida Administrative Code. However, PBGMC has failed to prove that it is substantially affected by any of the applications at issue in this proceeding. While the service areas of PBGMC and JFK overlap somewhat, there is virtually no overlap between the areas served by PBGMC and Delray. Although PBGMC has demonstrated that some of its cardiac patients reside in the JFK service area, its own witnesses testified that the great majority of its patients reside in other areas within District Nine, primarily the four counties north of Palm Beach County. It must be remembered that PBGMC's cardiac catheterization laboratory and open heart surgery program are very new and are both simply in the initial start-up phase. Even though PBGMC has been able to show that it may lose some of its cardiac patients to Delray and JFK which are located south of PBGMC, the evidence in this record indicates such an overwhelming need for services in District Nine that the only logical assumption is that PBGMC's programs will continue to grow at the same rapid pace at which they have been growing in the short time since their initiation. The approval of Delray and JFK's cardiac catheterization laboratory applications will make a total of three such laboratories within District Nine, whereas District Nine needs five such laboratories. It is clear why it would be difficult for PBGMC to show any substantial impact on its cardiac catheterization program by the granting of Delray's and JFK's applications. Similarly, the evidence clearly shows that there is a need for three open heart surgery programs within District Nine. The grant of Delray's and JFK's applications for such a program will bring the total number of programs in District Nine to three. Even assuming, for the sake of argument, that PBGMC's interest may be affected by the approval of Delray's and JFK's applications, PBGMC did not illustrate the nature of the interest affected or the decree of impact. Accordingly, PBGMC has failed to prove its standing in this proceeding.
Delray's challenge to JFK's open heart surgery program application fails for many of the same reasons that PBGMC's challenge failed. The need exists for both programs, and Delray failed to prove any impact on its programs by the granting of JFK's application. Since Delray has failed to show how it is affected, a fortiori, Delray has failed to show how it is substantially affected.
Delray and JFK have fully met their burden of proving they meet all statutory and rule criteria for the granting of their applications for CONs for cardiac catheterization laboratories and for open heart surgery programs.
RECOMMENDATION
Based upon the foregoing Findings of Fact and Conclusions of Law, it is, RECOMMENDED that a final order be entered:
Dismissing the petitions of North Ridge, PBGMC, and Delray in opposition to the JFK applications in that each of the Petitioners and Intervenors have failed to demonstrate standing to contest the JFK applications;
Dismissing the petitions of North Ridge and PBGMC in opposition to the Delray application in that each has failed to demonstrate standing to contest the Delray application; and
Granting Certificates of Need to Delray and JFK for cardiac catheterization laboratories and open heart surgery services.
DONE and ORDERED this 18th day of December, 1984, in Tallahassee, Florida.
LINDA M. RIGOT
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 18th day of December, 1984.
COPIES FURNISHED:
Richard M. Benton, Esquire
P. O. Box 1833
Tallahassee, Florida 32302-1833
Robert S. Cohen, Esquire
318 North Monroe Street
P. O. Box 669
Tallahassee, Florida 32302
C. Gary Williams, Esquire Michael J. Glazer, Esquire
P. O. Box 391
Tallahassee, Florida 32302
Robert Weiss, Esquire Perkins House, Suite 101
118 North Gadsden Street Tallahassee, Florida 32301
John Gilroy
318 North Calhoun Street
P. O. Drawer 11300
Tallahassee, Florida 32302-3300
David Pingree Secretary
Department of Health and Rehabilitative Services
1323 Winewood Boulevard
Tallahassee, Florida 32301
Docket for Case No: 83-003485CON
Orders for Case No: 83-003485CON
| Issue Date |
Document |
Summary |
|
Apr. 10, 1985 |
Agency Final Order
|
|
|
Dec. 18, 1984 |
Recommended Order
|
Grant of Certificates of Need (CON) for cardiac catheterization labs and open heart surgery services where need shown and protestors lacked standing.
|
