STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
PSYCHIATRIC HOSPITAL OF FLORIDA, ) INC., d/b/a HORIZON HOSPITAL, ) And PSYCHIATRIC HOSPITAL OF ) HERNANDO, INC., )
)
Petitioners, )
)
and ) Case No. 85-0780
) COMMUNITY CARE SYSTEMS, INC., ) D/b/a COMMUNITY CARE OF CITRUS ) COUNTY and MORTON F. PLANT ) HOSPITAL ASSOCIATION, INC., )
)
Intervenors, )
)
vs. )
)
DEPARTMENT OF HEALTH AND ) REHABILITATIVE SERVICES and ) FLORIDA HEALTH FACILITIES, INC., ) D/b/a PASCO PSYCHIATRIC CENTER, ) INC., )
)
Respondents. )
) UNIVERSITY PSYCHIATRIC CENTER, ) INC., )
)
Petitioner, )
)
vs. ) Case No. 85-1513
)
DEPARTMENT OF HEALTH AND ) REHABILITATIVE SERVICES and ) FLORIDA HEALTH SERVICES, d/b/a ) PASCO PSYCHIATRIC CENTER, INC., )
)
Respondents. )
) COMMUNITY HOSPITAL OF NEW )
PORT RICHEY, )
)
Petitioner, )
vs. ) Case No. 85-2346
)
DEPARTMENT OF HEALTH AND ) REHABILITATIVE SERVICES and ) FLORIDA HEALTH FACILITIES, INC., ) D/b/a PASCO PSYCHIATRIC CENTER, ) INC., )
)
Respondents. )
)
RECOMMENDED ORDER
Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, K. N. Ayers, held a public hearing in the above-styled cases on November 25, 26, and 27, and December 16, 1985, at Tallahassee, Florida.
APPEARANCES
For Petitioners: Charles Stampelos, Esquire Horizon Hospital William B. Wiley, Esquire and Psychiatric Post Office Box 2174 Hospital of Hernando: Tallahassee, Florida 32302
For DHRS: Douglas L. Mannheimer, Esquire Post Office Drawer 11300 Tallahassee, Florida 32302-3300
For Pasco F. Philip Blank, Esquire
Psychiatric Reynold Meyer, Esquire
Hospital: 241 East Virginia Street Tallahassee, Florida 32301
For Community Care Cari L. Roth, Esquire of Citrus County Post Office Box 1876
(Community Care): Tallahassee, Florida 32302
For University R. Terry Rigsby, Esquire Psychiatric 401 South Florida Avenue
Center (UPC): Tampa, Florida 33602
For Morton F. Cynthia S. Tunnicliff, Esquire Plant Association Post Office Drawer 190
(Morton Plant): Tallahassee, Florida 32302
For Community Donna Stinson, Esquire
Hospital of Ronald Kolins, Esquire New Port Richey 118 North Gadsden Street
(CHNPR): Tallahassee, Florida 32301
By Petition dated March 1, 1985, April 10, 1985 and June 19, 1985, Psychiatric Hospital of Florida, Inc., d/b/a Horizon Hospital and Psychiatric Hospital of Hernando, Inc., Petitioners in Case 85-0780 (Horizon and Hernando), University Psychiatric Center, Inc., Petitioner in Case 85-1513 (UPC) and Community Hospital of New Port Richey, Petitioner in Case 85-2346 (CHNPR), contest the issuance of a Certificate of Need (CON) to Florida Health Facility, d/b/a Pasco Psychiatric to construct a 72-bed short-term psychiatric hospital in Pasco County. Subsequent thereto Community Care System, Inc., d/b/a Community Care of Citrus County (Community), PIA Medfield, Inc., d/b/a Medfield Center (Medfield) and Morton F. Plant Association (Morton Plant) were granted leave to intervene in Case 85-0780 and the three cases were consolidated for hearing. PIA Medfield withdrew as a party prior to the commencement of the hearing.
By Prehearing Stipulation the parties agreed that criterion No. 10 of Section 381.494(6)(c) is not applicable to these proceedings and the issue is whether the applicant meets the other requirements of Section 381.494(6)(c) and (d).
At the hearing DHRS called one witness, Pasco called 17 witnesses, Community Care called one witness (by deposition), Horizon called two witness, Plant called one witness, UPC called one witness, CHNPR called four witnesses, and 44 exhibits were offered into evidence. All exhibits were admitted except Exhibit
20 to which objection was sustained.
Proposed findings have been submitted by the parties.
Treatment accorded proposed findings is contained in Appendix A attached hereto and made a part hereof. After considering the evidence submitted at the hearing, the following is submitted.
FINDINGS OF FACT
GENERAL
In November 1983, Pasco filed an application with DHRS to build and operate a freestanding psychiatric and substance abuse facility in Pasco County. Pasco is a Florida corporation and is a wholly owned subsidiary of Florida Health Facilities, Inc., which is a wholly owned subsidiary of United Medical Corporation (UMC).
DHRS' initial notice of intent to deny Pasco's application was issued on April 13, 1984. On May 3, 1984, Pasco timely filed its petition for formal administrative hearing. (DOAH Case No. 84-1933). Thereafter, DHRS reconsidered its initial decision, and on November 20, 1984, DHRS and Pasco entered into a Stipulation, and DHRS issued CON No. 3053 to
Pasco in February 1985. (DOAH Case No. 84-1933 was subsequently, dismissed as the result of this reconsideration.)
Following publication of DHRS' decision to issue the CON, petitions for formal hearing were filed by Horizon and Hernando, UPC, CHNPR, and Harborside Hospital, Inc., and petitions to intervene were filed by Community Care, Morton Plant and PIA Medfield, Inc., d/b/a Medfield Center. The petitions were consolidated and resulted in the cases at bar--DOAH Consolidated Case Nos. 85-0780, 85-1513 and 85-2346. Harborside Hospital, Inc., Petitioner in Case No. 85-2392, and PIA Medfield, Inc., d/b/a Medfield Center, Intervenor in Case No.
85-0780, subsequently voluntarily dismissed their petitions and are not parties to this proceeding.
Horizon is a freestanding psychiatric facility located at 11300 U.S. 19 South, Clearwater, in Pinellas County, in District V.
Hernando is an approved, as of September 1984, but as yet unopened 50-bed freestanding psychiatric facility to be located at the intersection of S.R. 50 and Clay Street in Brooksville, Hernando County. Hernando County is in District
III. Hernando's bed complement will consist of 35 short-term psychiatric beds, 15 short-term substance abuse beds and a 10-bed crisis stabilization unit.
UPC is an approved but yet unopened 114-bed psychiatric teaching facility to be located on the campus of the University of South Florida in Hillsborough County, in District VI. Its bed complement does not include licensed substance abuse beds.
CHNPR is a 414-bed acute care hospital located in Pasco County, Florida, in District V. As part of its bed complement, the hospital operates a 46-bed psychiatric unit. Its complement does not include licensed substance abuse beds.
Morton Plant is a 745-bed acute care hospital located in Pinellas County, District V. As part of its bed complement, the hospital operates a 42-bed psychiatric unit. Its bed complement does not include licensed substance abuse beds.
Community Care is an approved but as yet unopened 88-bed psychiatric facility to be located in Citrus County in District
Its bed complement includes 51 short-term psychiatric beds and 37 long-term substance abuse beds. Its bed complement does not include licensed short-term substance abuse beds.
Pasco originally proposed to construct and develop an 80-bed short-term psychiatric and substance abuse facility,
composed of 60 general adult beds, 10 adolescent beds and 10 substance abuse beds (Exhibit 4).
As a result of negotiations with DHRS, Pasco revised its proposal to a 72-bed facility composed of 35 general adult beds, 20 adolescent beds and 17 substance abuse beds (Exhibit 4, paragraph 1; Exhibit 11).
As a condition to DHRS' agreement to grant the Certificate of Need, Pasco has agreed to provide at least 10 percent of its patient days to residents of Pasco County eligible under the provisions of the Baker Act or who are indigent, and to locate its facility no less than five miles east of the intersection of U.S. Highway 19 and County Road 587 (Exhibit 4, paragraphs 3, 4).
The revised project cost, excluding working capital, totals $6,328,981.00 (Exhibit 6).
BED NEEDS
Applications for certificates of need must be consistent with criteria contained in Section 381.494(6)(c) as well as applicable rules of the agency. Subsection 1 of Section 381.494(6)(c) requires DHRS determine the proposal is consistent with:
The need for the health care facilities and services and hospices being proposed in relation to the applicable district plan and State Health Plan adopted pursuant to Title XV of the Public Health Service Act except in emergency circumstances which pose a threat to the public health.
The State Health Plan adopted addresses need through the year 1987, which is not the target year applicable to this case. The Plan indicates the need for short-term psychiatric and substance abuse beds should be determined based on the need methodologies found in Chapter 10-5.11(25) and 10-5.11(27) (Exhibit 27, page 6).
DHRS' rules establish specific criteria to be used in evaluating and acting on CON applications for psychiatric and substance abuse services and facilities. Chapter 10-5.11(25) and 3-5.11(27), Florida Administrative Code.
Psychiatric Bed Need In District V
Rule 5-11.25, Florida Administrative Code, allocates
.35 beds per 1,000 population in each district for psychiatric beds. Of those, not less than .15 per 1,000 population may be allocated within acute care general hospital settings and no more than .20 per 1,000 population may be located in freestanding psychiatric facilities. The differentiations recognize Medicaid reimburses facilities for psychiatric services provided in the acute hospital setting, but not in the freestanding setting, assuring at least some financial access to services for Medicaid patients and allows the agency, from a policy standpoint, to weigh the cost and benefits of building new facilities on one hand against adding additional beds at existing facilities (Exhibit 26, page 3).
The Office of Comprehensive Health Planning, under the signature of the Deputy Assistant Secretary of Health Planning and Development, has published the agency's Short-Term Psychiatric Bed Counts and Projected Bed Needs for 1990. On a district wide basis, the agency's document indicates a total gross need for 401 beds. There exist 372 licensed beds and no CON approved but unlicensed beds in District V. Morton Plant received preliminary approval for 22 beds but its application was subsequently denied by Final Order. See, Morton F. Plant Hospital Assn., Inc. v. DHRS, DOAH Case No. 83-1275, Final Order Oct. 8, 1985. Therefore, there currently exists a net projected need for 29 short-term psychiatric beds in District V for 1990.
Final approval of the application here would result in a district surplus of 26 beds, an increase in beds of less than 7 percent over the projected 1990 numerical need. This 26-bed surplus would replace the 29-bed need after the 55 beds granted to Pasco are considered (Exhibit 27, pages 15-16).
The projected numerical surplus for psychiatric beds in District V is due to an excess of 114 beds located in South Pinellas County. However, access problems to Pasco residents may, in fact, be one of the reasons for this excess (Exhibit 10, page 3).
Rule 10-5.11(25) projects the need at the district level, leaving the specific allocation to the agency and to the Local Health Council by identifying particular areas within the district that may need additional beds through use of the Local Health Plan (Exhibit 26, page 3).
The Local Health Council's 1985 plan projects needed beds to the target year 1990 and projects need by subdividing District V on a geographic basis of East and West Pasco and North and South Pinellas Counties (Exhibit 8, page 110, Tables 8 and 11; Exhibit 10, page 2). The Plan establishes subdistricts
identical to those subdistricts which have been designated for acute care beds (Exhibit 8, page 110, Tables 8 and 11; Exhibit
10, page 2; Exhibit 27, page 8).
The subdistrict concept evidences a rational division of the District's population and healthcare communities (Exhibit 10, page 2; Exhibit 27, page 8). In view of the poor transportation situation in Pasco County as well as traffic congestion along U.S. Highway 19, especially during the tourist period, an access problem exists for patients and their families seeking psychiatric and substance abuse inpatient services (Exhibit 10, page 2).
In 1990, Pasco County's population will reach 286,488. This total is broken down into East and West Pasco County, with population projected to be 88,811 and 197,677, respectively. Application of the numerical need methodology to the Pasco population indicates a projected need for 101 psychiatric beds in Pasco County, allocating 70 beds to West Pasco and 31 beds to East Pasco, to insure adequate services are provided to all residents of the County (Exhibit 26, page 3).
Recognizing the existence of 46 psychiatric beds at Community in West Pasco, there remains a projected need for 24 psychiatric beds in West Pasco County. With no existing psychiatric beds being located in East Pasco County, between the two areas there is an estimated need for 55 psychiatric beds in the County as a whole, the precise number of short-term psychiatric inpatient beds sought for approval by Pasco (Exhibit 26, page 3).
Applying the allocation portion of the rule for freestanding facilities to Pasco County residents, there is indicated a net need for beds in freestanding settings of 58 beds by the year 1990. The grant of 55 beds to the applicant in this case is, therefore, consistent with the provision of the rule (Exhibit 26, pages 3, 4).
Rule 10-5.11(25)(d)7 recognizes that an applicant proposing to build a new but separate short-term psychiatric facility should have a minimum of 50 beds. There is no practical manner within which to approve a facility in East Pasco County at the present time, based solely on the East Pasco population, since the numerical need is only 31 (Exhibit 26, page 3).
From a health planning standpoint, it is practical to build a facility in the middle of the County, as proposed here. The impact upon existing providers is lessened by its location while at the same time the facility has the ability to obtain patients from all portions of the County. A facility located
farther east would not be financially feasible as a result of the low base population (Exhibit 26, page 3).
According to Rule 10-5.11(25)(e)7, "short term inpatient hospital psychiatric services should be available within a maximum travel time of 45 minutes under average travel conditions for at least 90% of the service area's population." Conversely stated, not more than 10% of the Pasco service area population should be outside this time/travel standard. The Pasco proposed project meets the objectives of this criterion and improves geographic access to psychiatric care for Pasco County residents (Exhibit 28, page 3).
Unlike a psychiatric unit in a general acute care medical hospital, it is not possible for the psychiatric beds proposed here to be used for acute medical purposes. The concept of a focused, single-purpose facility is also in keeping with the goal of the District Mental Health Board Plan which indicates the need to develop centralized inpatient services in Pasco County. Rule 10-5.11(25) (e)1 (Exhibit 28, page 5).
The Local Health Plan notes that it would be cost effective to apply a 75 percent average occupancy threshold for psychiatric and substance abuse services within the service area when considering additional inpatient facilities or services of this type. It also indicates that facts such as patient origin and accessibility should be considered within the need for beds. The plan notes that individuals from Pasco County have had to seek Baker Act services outside of the County and even the District. Thus, access to inpatient care for the indigent psychiatric patient is recognized to be a problem in Pasco County (Exhibit 8; Exhibit 27, pages 11-12; TR-84, lines 16-25; TR-85, lines 16-25; TR-93, lines 23-25; TR-94, line 1).
According to the-plan, Baker Act and indigent residents of Pasco County must travel to facilities in District VI to obtain these services. Additionally, with respect to the need for beds, the Local Health Plan indicates that if the subdistrict analysis is accepted, then the need for psychiatric and substance abuse beds is greatest in Pasco County. The plan also notes that while past utilization of the psychiatric unit which exists in West Pasco County would seem to suggest low demand in the County, the low utilization stems in part from the restriction of access to private pay and involuntary patients (Exhibit 27, page 12).
According to the plan, services are only being provided to private pay, voluntary patients; consequently, indigent patients are not being served. Baker Act patients who are involuntarily admitted have not been served (Exhibit 27, pages
12-13; TR-374, lines 2-25; TR-376, lines 21-25; TR-377, lines 1-
11).
The applicant is proposing to allocate a combined total of at least 10 percent of its patient days to Baker Act and indigent patients, clearly assisting in meeting this need (Exhibit 27, pages 17-18).
The Local Health Plan represents local statements and input addressing the needs within the community.
The application meets and is consistent with the standards noted in the existing and approved Local Health Plan for District V (Exhibit 10, page 3), a specific requirement of Rule 10-5. 11(25 (e) 1.
The applicant initially projected an occupancy rate of
71 percent of the second year and approximately 83 percent of the third year of operation satisfying the criterion contained in Rule 10-5.11.(25)(d), Florida Administrative Code. Subsection (d)(5) recommends that a project would normally not be approved unless the average annual occupancy rate for all existing short- term inpatient psychiatric beds in the district is at or exceeds
75 percent for the preceding 12-month period. DHRS has interpreted this to be the average annual occupancy rate for all facilities for the short-term psychiatric beds within the service district, because the rule refers to the annual occupancy rate for existing beds in the service district, rather than to facilities (Exhibit 27, page 16).
During the 12-month period July 1, 1984 through June 30, 1985 the existing short-term psychiatric facilities in District V reported an average of 75 percent occupancy level (Exhibit 27, page 17).
Rule 10-5.11(25), Florida Administrative Code, indicates that a favorable determination may be made even when criteria other than those specified in the numeric need methodology, as provided further in Subsection (e) of Chapter 10- 5.11(25), are not met. This would also be true when applying the other criteria utilized in Section 381.494(6)(c) (Exhibit 27, page 13).
Considering all these factors and the benefits that the proposed project would bring, there is a projected need for the
55 proposed short-term psychiatric beds shown under Rule 10- 5.11(25) (Exhibit 27, pages 22-23).
Substance Abuse Bed Need In District V
Rule 10-5.11(27) establishes a bed-to-population ratio of .06 beds per 1,000 population for the projected year in question (Exhibit 26, page 4).
The need methodology, as applied to District V for 1990, shows a total need for 69 short-term substance abuse beds in District V. There are presently 74 licensed short-term substance abuse beds in District V and no additional CON approval. This results in a surplus of five beds in the district, without including the 17 beds approved for Pasco Psychiatric Center. (Exhibit 10, page 3, Exhibit 27, pages 23- 24).
The Local Health Council has projected a need through 1990 for 17 substance abuse beds, using the State's formula contained in Rule 10-5.11(25) and 10.5.11(27) and applying the formula on a subdistrict basis (Exhibit A, page 118, table 11; Exhibit 10, page 2).
Subsection (h)(l) contains a suggested standard of 80 percent occupancy rate in the District for the past 12 months. During the period from July 1, 1984 through June 30, 1985 reporting substance abuse bed facilities reported an average occupancy level of 88 percent. DHRS has determined there exist
22 short-term substance abuse beds at Horizon Hospital. However, Horizon does not report its utilization of those beds separately, but includes them within its reported short-term psychiatric beds (Exhibit 27, page 25).
Much in the same manner as the short-term psychiatric rule, Rule 10-5.11(27)(h)3 refers to the Local Health Plan and consistency with local need determinations. According to the plan, there is a projected need in the two Pasco subdistricts for
17 short-term substance abuse beds by application of the numerical methodology .06 beds per 1,000 population to Pasco County. There are no short-term substance abuse beds available or approved in the Pasco County subdistricts (Exhibit 27, pages 11, 25-26).
Rule 10-5.11(27)(h)4 establishes a minimum unit size of
10 designated beds. Additional calculation reveals that the numerical need for 17 beds is broken down into 12 beds in the . West Pasco area and five in East Pasco. Because of the minimum size requirement, there is no reasonable way for a unit to be built solely based on the East county portion of the numerical need. Consequently, a proper health planning alternative is to approve the 17-bed unit, which will be centrally located to serve both portions of the County (Exhibit 26, page 4).
A Certificate of Need may be approved where need is determined through criteria other than the numeric need methodology. For example, criteria in Section 381.494(6)(c) and in subparagraph (f) of Rule (27) may indicate that need is demonstrated for the project beyond the numerical formula (Exhibit 27, page 23).
Upon analysis of all the factors contained within the rule, the applicant meets the need for the Pasco subdistricts.
AREAS OF CONSIDERATION IN ADDITION TO BED NEEDS
A. Availability, Utilization, Geographic Accessibility And Economic Accessibility
The availability, quality of care, efficiency, appropriateness, accessibility, extent of utilization and adequacy of like and existing health care services and hospices in the service district of the applicant. Section 381.494 (6) (c) 2
A number of hospital facilities serve District V's residents in need of psychiatric and substance abuse health care services (Exhibit 10, page 16 and 17, tables 9 and 10). Of these, Anclote Manor's patients have an average length of stay of more than two years. Anclote is licensed as a long-term care facility (Ibid., Exhibit 28, page 3) St. Anthony's Hospital, Mease Hospital and Suncoast Hospital have not contested the agency's initial decision to grant this application, leaving only Morton Plant and Horizon in Pinellas County and CHNPR in Pasco County as District V parties objecting to the application. CHNPR's patients are predominantly geriatric (Exhibit 28, page 3).
During 1984 the utilization of psychiatric beds at Morton Plant was 137 percent. Hospitals in North Pinellas County show an average 100 percent utilization of their psychiatric beds for the period (Exhibit 35, pages 10 and 11). However, for the same period, utilization of CHNPR's psychiatric unit was 50 percent. Ibid.
During the last available 12-month period of information (July 1, 1984 through June 30, 1985), the existing short-term psychiatric facilities in District V reported an average occupancy level of 75 percent (Exhibit 27, pages 16-17).
Based upon utilization of less than 75 or 80 percent, there may exist underutilized beds for psychiatric services at Horizon Hospital (TR-798, lines 19-20). However, this conclusion
is based upon the assumption that Horizon is licensed for 200 psychiatric beds (TR-798, lines 21-23). DHRS however, considers that Horizon is licensed (License 1809) for 178 psychiatric beds (TR-800, lines 10-15). Consequently, the number of licensed psychiatric beds affects the occupancy rates at Horizon.
In order to determine access or demand within a community, factors besides utilization must be looked at (TR-887, lines 13-21). A number of other factors may and in this case do, in fact, affect occupancy rates (TR-887, lines 13-21).
In addition to location, the existence of semi-private rooms, sex and age segregation policies adopted by various facilities, and corporate decisions artifically impede access and thus affect utilization and occupancy rates (TR-431, lines 9-13; TR-883, lines 12-24, 25; TR-884, lines 1-10).
CHNPR's low occupancy rates are affected by the facility's location, lack of a commitment to indigents medically underserved patients, as well as its lack of segregation of psychiatric beds between adults and children (TR-392, lines 24- 25; TR-393, lines 1-9; TR-397, lines 13-19; TR-398, lines 4- 10).and 13; TR 883, lines 12-24, 25; TR-884, lines 4-10).
Pasco residents have been forced to seek inpatient psychiatric and substance abuse services outside the County for years (Exhibit 21, page 1).
The location of CHNPR in the western part of the county makes services inaccessible to residents of the eastern part of the county (TR-397, lines 1319; TR-398, lines 4-10).
No facility exists in Pasco County that contains the proper housing for adolescents who need psychiatric services (Exhibit 21, page 2).
Rainbow House, an adolescent residential care center in Dade City, can accommodate a very limited number of children and is not prepared to handle acutely ill children (TR-399, lines 5- 9).
While CHNPR's psychiatric unit is designated for 46 beds, only 26 beds are available for psychiatric services. The dramatic changes in occupancy at Community Hospital of New Port Richey from 80 percent to 40 percent indicate the psychiatric beds are used for acute medical purposes (Exhibit 22, page 2).
Without a public transportation system in Pasco County, travel time for Pasco residents and their families is a problem (TR-401, lines 14-25; TR-402, lines 1-23).
A major portion of Pasco residents who have been provided inpatient services are provided those services by facilities located one hour away (Exhibit 22, page 2; Exhibit 23, pages 1-2; TR-397, lines 7-16).
The access problem is more acute for the elderly, which comprise 32.7 percent of Pasco's population compared to 19.3 percent for all of Florida projected to 1990 (Exhibit 26, page 2).
The distance to facilities serving Pasco County residents is sufficiently great as to make follow-up care very difficult, preventing family involvement, and making treatment inefficient (TR-325, lines 7-25; TR-408, lines 1-8; TR-436, lines 12-25).
Based upon a July 1985 population of 240,204 approximately 13 percent of Pasco County residents are not within a 45-minute total travel time to a psychiatric facility in District V. This number is expected to increase to 19 percent of the County's population by 1990 (Exhibit 18, page 17, figures 10 and 11; page 14 and figure 13, page 15).
United Medical Corporation (UMC), which owns Pasco, has a history of providing services to indigents and medically underserved (Exhibit 13, page 2) and in particular to residents of Pasco County. Ibid. This is based upon UMC's former ownership of Tampa Heights Hospital. At that time it was the facility that admitted Baker Act patients from Pasco County (Exhibit 10, page 3; Exhibit 13, page 2).
CHNPR's recent corporate decision to take Baker Act patients is not persuasive as to the issue of access to indigents and medically under served (Exhibit 27, pages 19-20). The timing of the agreement with the Pasco and Hernando Human Development Councils during the pendency of these proceedings indicates, at a minimum, that the application here has already favorably affected access to these citizens. CHNPR's policy with respect to indigents, Medicaid and the medically underserved residents reduces the accessibility of these patients to its facility. See Turro v. DHRS and CHNPR v. DHRS, DOAH Case Nos. 83-005 and 83- 092, Recommended Order September 7, 1983, Final order October 25, 1983, 6 FALR 336, et seq.
The proposed project will be accessible to residents in need of psychiatric and substance abuse services in District V.
NEED FOR SPECIAL EQUIPMENT
The need in the service district of the applicant for special equipment and services which are not reasonably and economically accessible in adjoining areas. Section 381.494 (6) (c) 6.
Although an issue in this proceeding, no evidence was presented as to the applicability of this criterion or the applicant's consistency or inability to meet this criterion. It is thus specifically found that this criterion is not applicable.
NEED FOR RESEARCH AND EDUCATIONAL FACILITIES
The need for research and educational facilities including but not limited to institutional training programs and community training programs for health care practitioners and for doctors of osteopathy and medicine at the student internship and residency training level. Section 381.494(6)(c)7,.
Although an issue in this proceeding, no evidence was presented as to the applicability of this criterion or the applicant's consistency or inability to meet this criterion. It is specifically found that this criterion is not applicable.
AVAILABILITY OF RESOURCES
The ability of the applicant to provide quality of care. Section 381.494(6) (c)3.
The availability of resources including health manpower, management personnel and funds for capital and operating expenditures for project accomplishment and operation; the effects the project will have on clinical needs of health professional training programs in the service district; the extent to which the services will be accessible to schools for health professions in the service district for training purposes if such services are available in the limited number of facilities; the availability of alternative uses of such resources for the provision of other health services; and the extent to which the proposed services will be accessible to all residents of the service district. Section 381.494 ( 6) (c) 8.
Management and Quality of Care
UMC, the parent corporation, has at its disposal management personnel and will be able to obtain health manpower to accomplish the project (Exhibit 12, page 2; Exhibit 13, pages 1-2).
UMC presently owns and operates three psychiatric hospitals (Exhibit 11, page 1). The facility will have at its disposal UMC's services in the areas of management and recruitment. UMC has successfully recruited physicians and other health care providers in the past (Exhibit 13, page 1) lines 1-5; TR-332, lines 19-21).
The applicant will be able to adequately staff and, manage the facility and provide quality care to its patients in the service area.
Funds for Capitol and Operating Expenditure
UMC has obtained a commitment from Freedom Savings & Loan Association to finance the project (Exhibit 14, page 2) and will therefore be able to obtain the financing necessary to build and operate the facility.
No evidence was presented to show the project will have a detrimental effect on clinical needs of health professional training programs in the district for training.
Financial Feasibility
The facility will be financed through a construction loan with a 5-year permanent financing package at a rate of prime plus one and one-half percent floating and a two percent fee (Exhibit 14, page 1).
The projections contained in Exhibit 7 and Exhibit 5 as well as the underlying assumptions indicate the figures represent reasonable and accurate estimates of income and expenses that will be incurred in the event the Certificate of Need is issued (Exhibit 9, page 1; Exhibit 11, pages 2-3; Exhibit 12, pages 1-2; Exhibit 13, pages 1-2; Exhibit 15, page 2; Exhibit 17, pages 1-2; Exhibit 25, pages 6-9). Note: See also, Hoefle's testimony.
CHNPR contends that the projected ALOS should be considered at CHNPR's level. However, the ALOS at CHNPR's psychiatric unit is directly affected by the influx of Baker Act patients and contractual limitations (TR-921, lines 19-25; TR- 922, lines 1-2; TR-452, lines 14-17; TR-453, lines 5-12).
In the final analysis the financial feasibility of the proposal will depend to a large degree on whether physicians will admit patients to the facility. Doctors Vesley and Rudajev will support the facility when built and their projections as to the numbers of patients and ALOS are reasonable (TR-292, lines 17-18; TR-293, lines 4-7; TR-293, lines 12-15; TR-295, line 16; TR-317, lines 19-24; TR-324, lines 13-24; TR-325, lines 1-2; TR-336, lines 19-22; TR-332, lines 19-21). It is reasonable that other physicians in Pasco County will locate in the area surrounding the hospital and will support the facility once it is opened (TR- 413, lines 7-17; TR-792, lines 2-9).
The needs and circumstances of those entities which provide a substantial portion of their services or resources or both to individuals not residing in the service district in which the entities are located or in adjacent service districts. Such entities may include medical and other health professions, schools, multi-disciplinary clinics and specialty services such as open-heart surgery, radiation therapy and renal transplantation. Section 381.494 (6) (c) 11.
No evidence was presented indicating the applicability of this criterion or the applicant's ability or inability to meet this criterion. I find this criterion not applicable.
AVAILABILITY OF HEALTH CARE ALTERNATIVES
The availability and adequacy of other health care facilities and services and hospices in the service district of
the applicant, such as outpatient care and ambulatory or home care services which may serve as alternatives for
the health care facilities and services to be provided by the applicant.
Section 381.494 (6) (c) 4.
At the time of hearing, no alternatives to the application proposed were presented. Nor was other evidence presented to indicate alternatives to the proposed facility and services are, in fact, available at the time of this proceeding.
Other than CHNPR no facilities located in Pasco County provides inpatient psychiatric services (TR-400, lines 21 25; TR- 4 01, lines 1-3).
Probable economies and improvements in service that may be derived from operation of joint, cooperative or shared health care resources.
Section 381.494 (6) (c) 5.
The facility will share resources with other facilities owned or operated by UMC such as common training and joint purchasing (Exhibit 11, page 1); financial management (Exhibit 12); financing (Exhibit 14); and recruitment and marketing (Exhibit 13). These shared resources will provide economies and improve services presently available in District V.
IMPACT UPON EXISTING FACILITIES AND COSTS AND COMPETITION The probable impact of the proposed project
on the cost of providing health services
proposed by the applicant upon consideration of factors including but not limited to the effects of competition on the supply of health services being proposed and the improvements or innovations in the financing and delivery of health services which foster competition and service to promote quality assuance and cost effectiveness. Section 381.494 (6) (c) 12.
Two hospitals in Pasco County in relatively close proximity to each other are owned by Hospital Corporation of America--Community Hospital of New Port Richey and Bayonet Point Medical Center--giving HCA 86 percent of all hospital beds in the West Pasco service area. The applicant's expert, Dr. Scott, compared statewide HCA hospital averages and daily pre-tax profits based on adjusted patient days with those at CHNPR and Bayonet Point, using 1982 actual hospital data reported to the Hospital Cost Containment Board. The data indicates a much higher than HCA average operating margin, total margin, daily gross revenues and daily pre-tax profits. In Pasco County, HCA shows profitability roughly double that of its statewide averages (Exhibit 25, pages 3-4).
HCA has now acquired the nearby freestanding psychiatric hospital at the University of South Florida (Exhibit 25, pages 3-4; TR-854, lines 14-18). Without competition, HCA will not be required to compete in Pasco County for price or quality of care. Approval of the application should significantly reduce HCA's share of the Pasco-Hillsborough market in terms of beds and would positively affect competition and the delivery of health care services (Exhibit 25, page 5; Exhibit 27, pages 29-30).
In 1985 CHNPR psychiatric unit's occupancy rate was 41 percent (Exhibit 41, page 4). Following execution of its Baker Act agreements, occupancy rose to 49.7 percent (TR-921, pages 5- 18).
CHNPR is a large institution which grossed more
than $1 million in pre-tax income based on 50 percent utilization (TR-998, lines 21-25).
CHNPR projects that in 1987, 1988 and 1989 only 1 percent of its revenues will be derived from Medicaid patients and .9 percent will be derived from indigents (TR-915, lines 18- 25; TR-916, lines 1-5).
Left without competition, HCA will continue to dominate the health care delivery system in Pasco County, a situation which should not be continued. (TR-620, lines 24-25; TR-621; TR- 622).
Morton Plant's witness agreed there exists a need for additional psychiatric and substance abuse beds in Pinellas and Pasco Counties in District V (TR-829, lines 15-25; TR-833, lines 3-6).
In 1984, approximately 4 percent of Morton Plant's psychiatric patients resided in Pasco County (TR-837, lines 14- 17).
Morton Plant's psychiatric unit's occupancy rates have consistently exceeded 100 percent (TR-838, lines 3-6) and there is a waiting list at Morton Plant's adolescent unit (TR-843, lines 2-4).
Morton Plant presented no evidence that issuing this CON to Pasco would substantially affect its psychiatric unit (TR- 826, line 25; TR-827, lines 1-25; TR-828, lines 1-9).
UPC, now owned by HCA, is located outside District V. UPC, as a university hospital, is different from any other in Florida (TR-860, lines 17-24). It was UPC's mission as a research and teaching facility, and its regional concept of
.referrals extending over 17 counties, that led to the grant of its application by DHRS (TR-860, line 25; TR-861, lines 1-21).
UPC projected 30 percent of its patients would be referred from outside the area including Pasco County (TR-856, lines 6-11). This limitation was not considered by Dr. Fernandez in concluding that UPC would be adversely affected by the grant of the CON to Pasco.
The effect upon UPC is further lessened when one considers the general availability of UPC's facility to the Pasco/District V community. In order to admit patients to the UPC facility, physicians must be members of the UPC faculty (TR- 857, lines 5-11).
Eight of UPC's beds will be subject to admissions restricted to only two physicians (TR-857, line 25; TR-858, lines 1-25; TR-859, lines 1-20).
Horizon and Hernando are owned by PIA.
Horizon receives approximately 5 percent of its patients from Pasco County (TR-787, lines 23-25; TR-788, lines 1- 2).
Approval of the Pasco facility may cause Horizon to lose 80 to 90 percent of its total 137 admissions from Pasco--109 to 123 admissions; however, this loss may occur with or without approval of this application (TR-792, lines 17-25; TR-793, lines 1-9).
Horizon's expert's testimony regarding utilization was based upon Horizon being licensed for 200 psychiatric beds (TR- 798, lines 1-24); however, DHRS considers Horizon licensed for 178 (TR-798, lines 25; TR-799, lines 1-25; TR-800, lines 1-25;
TR-801, lines 1-4).
Hernando, located in District III, relied upon a need argument based solely on District III, not District V, in pursuing its CON application (TR-770, lines 18-25; TR-771, line 1).
Hernando has previously defined its primary service area as only including Citrus and Hernando Counties, both in District III, and did not include Pasco County within its secondary service area, or for purposes of projecting its admission rates or feasibility (TR-771, lines 14-22; TR-772 lines 10-15; TR-775, lines 20-25; TR-776, lines 1-2; TR-777, lines 5- 16).
Community Care has not determined a site for its facility in Citrus County (Exhibit 29, page 6, lines 9-11).
Community Care opposes the application because its main concern is the reduction in market share that may be available to its facility (Exhibit 29, page 27, lines 2-6).
In its CON application in 1983, Community Care relied only upon District III as its population base (Exhibit 29, page 8, lines 18-21; page 9, lines 19-25).
Community Care relief upon the Local Health Plan in District III in establishing need (Exhibit 29, page 10, lines 1-
10) and relied solely upon Citrus and District III population growth as its patient base (Exhibit 29, page 10, lines 10-15).
Community Care will not provide short-term substance abuse services (Exhibit 29, page 20, lines 12-18; page 25, lines 11-25).
Approval of the Pasco facility will not increase the cost of health services in District V and will favorably affect present services, promoting more efficiency in the health delivery system. The effect of the approval, with its related conditions, will assure access to underserved residents who otherwise will continue at the mercy of the HCA facilities. 110. Approval will not substantially adversely affect providers within or outside District V.
CAPITAL EXPENDITURE PROPOSALS
The costs and methods of proposed con- struction, including the costs and methods of energy provision and the availability of alternative, less costly, or more effective methods
of construction. Section 381.49 (6) (c)13.
In cases of capital expenditure proposals for the provision of new health services to inpatients, the department shall also reference each of the following its findings of fact:
That less costly, more efficient, or more appropriate alternatives to such inpatient services are not available and the development of such alternatives has been studied and found not practicable.
That existing inpatient facilities providing inpatient services similar to those proposed are being used in an appropriate and efficient manner.
In the case of new construction, for example, modernization or sharing arrangements, have been considered and have been implemented to the maximum extent practicable.
That patients will experience serious problems in obtaining inpatient care of the type proposed, in the absence of the proposed new service. Section 381.494 ( 6) (d) 1-4.
The evidence indicates the costs and methods of the proposed construction are reasonable. The normal percentage of architectural and engineering fees are in the range of 5 percent to 7 percent of construction costs; in this case the architectural and engineering fees are approximately 6 percent. The construction costs of approximately $78 to $80 per square foot are reasonable for this type facility (Exhibit 15, page 2; Exhibit 17, pages 1-2). See also footnotes to paragraphs 86 and 87.
Less costly, more efficient or more appropriate alternatives to the services proposed here are not available. No existing facility or applicant has filed an application seeking to provide services similar to those sought to be provided by this applicant for the target population year 1990.
Existing inpatient facilities providing services similar to those proposed are being used in an appropriate and efficient manner. Utilization rates at existing district facilities when considered in light of accessibility including artificial barriers, indicate the facilities are being used in an appropriate and efficient manner.
As noted earlier, alternatives to the project here at issue are not present.
The lack of access, geographical, financial and artificial, to residents of Pasco County in need of psychiatric and substance abuse services, as well as the numerical need evidenced by application of the state-mandated need methodologies indicate that, absent the proposed service, patients will experience serious problems in obtaining psychiatric and substance abuse inpatient care.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings.
Although those opposing the issuance of the CON to Pasco contended that all of the 13 criteria under Section 381.494(6)(c), except criterion No. 10, were to be litigated, the primary emphasis of all parties was on the issues of need and access to existing facilities.
Section 381.494(4) and (6), Florida Statutes, both refer to the need of the facility in relation to the Local Health Plan.
Each district adopts a Local Health Plan but these plans are not adopted as rules by DHRS. Accordingly, they do not carry the same force and effect they would enjoy as rules. This does not preclude the use of these plans as required by the statute; it only requires proof of the reasonableness of the plans.
Subsequent to the filing of this application by Pasco, CHNPR opened its facilities to provide service to Baker Act patients. Prior thereto there was no facility located in Pasco
County to which to send Baker Act psychiatric patients. Had this application not been filed, it is likely there would still be no facility in Pasco County to which to send Baker Act patients.
Accordingly, CHNPR's pious complaints, that granting this CON to Pasco will drive them out of business, do not warrant much credence. Likewise, CHNPR's contention that they provide services to all indigents admitted to their facility is not supported by statistics that indicate much indigent care is provided by CHNPR. Apparently doctors having privileges at CHNPR are careful not to admit indigent patients.
The Local Health Plan for District V divides the district into four subdistricts. This division into the subdistricts of North and South Pinellas County and East and West Pasco County is a rational division and one which lends itself to solving the access problems of these counties. Applying the bid need methodology to the subdistrict shows a need in both East and
West Pasco Counties by 1990. The proposal by Pasco exactly fulfills this need. It is significant that all of the local health agencies support this application and attest to the need for the facility in Pasco County. All applications do not fit into exact molds from which the decision to grant or deny the application automatically flows. All of the criteria of Section C 581.494(6)(c) and (d), Florida Statutes, must be considered and it is only after all of those criteria are weighed is the decision arrived at. Applying those criteria to the situation in Pasco County and projecting the population to 1990 shows a need for the 72-bed facility proposed to commence providing services in 1990.
From the foregoing it is concluded that a need exists in Pasco County for a 72-bed short-term psychiatric hospital with 35
general adult beds, 20 adolescent beds, and 17 substance abuse beds; that Pasco is fully qualified to provide the proposed service; and that the granting of this CON will not adversely affect health care in District V. It is
RECOMMENDED that a Certificate of Need be granted to Florida Health Facilities, Inc., d/b/a Pasco Psychiatric Center, Inc., to establish a 72-bed psychiatric hospital in Pasco County.
ENTERED this 19th day of February, 1986, at Tallahassee, Florida.
K. N. AYERS, Hearing Officer Division of Administrative Hearings The Oakland Building
2009 Apalachee Parkway
Tallahassee, Florida 32399
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 19th day of February, 1986.
COPIES FURNISHED:
William B. Wiley, Esquire McFarlain, Bobo, Sternstein,
Wiley & Cassedy, P.A. Post Office Box 2174 Tallahassee, Florida 32316
Charles Stampelos, Esquire Post Office Box 2171 Tallahassee, Florida 32302
Douglas L. Mannheimer, Esq.
Culpepper, Pelham, Turner & Mannheimer Alan C.
Post Office Drawer 11300 Tallahassee, Florida 32302-3300
Cynthia S. Tunnicliff, Esquire Alan C. Sundberg, Esquire
Post Office Drawer 190 Tallahassee, Florida 32302
F. Philip Blank, Esquire Reynold Meyer, Esquire
241 East Virginia Street Tallahassee, Florida 32301
Donna H. Stinson, Esquire The Perkins House
Suite 100
118 North Gadsden Street Tallahassee, Florida 32301
James C. Hauser, Esquire Messer, Vickers, Caparello,
French & Madsen Post Office Box 1876
Tallahassee, Florida 32302
C. Gary Williams, Esquire Michael J. Glazer, Esquire Ausley, McMullen, McGehee,
Carothers & Proctor Post Office Box 391
Tallahassee, Florida 32302
R. Terry Rigsby, Esquire Catherine Peek McEwen, Esquire Moffitt, Hart & Miller
401 South Florida Avenue Tampa, Florida 33601
Mark Herron, Esquire
215 South Monroe Street Tallahassee, Florida
================================================================= AGENCY FINAL ORDER
=================================================================
STATE OF FLORIDA
DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES
PSYCHIATRIC HOSPITAL OF FLORIDA, INC., d/b/a HORIZON HOSPITAL, and PSYCHIATRIC HOSPITAL OF HERNANDO, INC.,
Petitioners,
and Case No. 85-0780
CON No. 3053
COMMUNITY CARE SYSTEMS, INC., D/b/a COMMUNITY CARE OF CITRUS COUNTY and MORTON F. PLANT HOSPITAL ASSOCIATION, INC.,
Intervenors,
vs.
DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES and FLORIDA HEALTH FACILITIES, INC., D/b/a PASCO PSYCHIATRIC CENTER, INC.,
Respondents.
/ UNIVERSITY PSYCHIATRIC CENTER, INC.,
Petitioner,
vs. Case No. 85-1513
CON No. 3053
DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES and FLORIDA HEALTH SERVICES, d/b/a PASCO PSYCHIATRIC CENTER, INC.,
Respondents.
/ COMMUNITY HOSPITAL OF NEW
PORT RICHEY,
Petitioner,
vs. | Case No. | 85-2346 |
CON No. | 3053 | |
DEPARTMENT OF HEALTH AND | ||
REHABILITATIVE SERVICES and | ||
FLORIDA HEALTH FACILITIES, INC., | ||
d/b/a PASCO PSYCHIATRIC CENTER, | ||
INC., | ||
Respondents.
/
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 submitted a Recommended Order to the Department of Health and Rehabilitative Services (HRS). A copy of that Recommended Order is attached hereto. Exceptions to the Recommended Order were filed by Petitioner, MORTON F. PLANT HOSPITAL ASSOCIATION ("MORTON PLANT"), UNIVERSITY PSYCHIATRIC CENTER, INC. ("UPC") PSYCHIATRIC HOSPITALS OF FLORIDA, INC., d/b/a HORIZON HOSPITAL and PSYCHIATRIC HOSPITAL OF HERNANDO, INC.("PHH") and COMMUNITY HOSPITAL OF NEW PORT RICHIE ("CHNPR"). Morton Plant filed
"Notice of Withdrawal of Petition to Intervene on July 10, l986.
RULING ON EXCEPTIONS
1. Paragraphs 6, 19, 20, 24, 25, 26, 27, 28, 45, 46, 57,
58, 61, 62, 63, 64, 65, 66, 72, 73, 79, 95, 96, 97 and 110 are
based upon competent substantial evidence. UPC's exceptions are denied.
2. Findings of Fact 18-40, 49, 55, 58, 60, 67, 77, 84, 85
and 89 are based upon competent substantial evidence. The conclusions of law are supported by the findings of fact. CHNPR's exceptions are denied.
3. Paragraphs 22, 25-28, 31-34, 37, 38, 40, 61-65, 71-73,
76-79, 81, 98, 112-115. The recommended order, which is adopted, application. The conclusions of law are supported by the fully articulates the reasons supporting grant of this findings of fact. The local health plan expresses a need for the service where the applicant proposes to provide the service.
PHH's exceptions are denied.
FINDINGS OF FACT
The findings of fact contained in the recommended order are adopted and incorporated herein as though fully set forth.
CONCLUSIONS OF LAW
The conclusions of law contained in the recommended order are adopted and incorporated herein as though fully set forth.
Based upon the foregoing, it is
ADJUDGED, that the application of Florida Health Facilities, Inc. d/b/a Pasco Psychiatric Center, Inc. for Certificate of
Need (3053) to establish a 72 bed psychiatric hospital in Pasco County, Florida is GRANTED.
DONE and ORDERED this 23rd day of 1986, in Tallahassee, Florida.
WILLIAM J. PAGE, Secretary
A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE Copy OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF HRS, AND A SECOND COPY, ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.
Copies furnished to: William B. Wiley, Esquire
McFarlain, Bobo, Sternstein, Wiley & Cassedy, P.A.
Post Office Box 2174 Tallahassee, Florida 32316
Douglas L. Mannheimer, Esquire Culpepper, Pelham, Turner
& Mannheimer
Post Office Drawer 11300 Tallahassee, Florida 32302-3300
F. Philip Blank, Esquire Reynold Meyer, Esquire
241 East Virginia Street Tallahassee, Florida 32301
James C. Hauser, Esquire Messer, Vickers, Caparello,
French & Madsen Post Office Box 1876
Tallahassee, Florida 32302
C. Gary Williams, Esquire Michael J. Glazer, Esquire Ausley, McMullen, McGehee,
Carothers & Proctor Post Office Box 391
Tallahassee, Florida 32302
R. Terry Rigsby, Esquire Catherine Peek McEwen, Esquire Moffitt, Hart & Miller
401 South Florida Avenue Tampa, Florida 33601
Mark Herron, Esquire
215 South Monroe Street Tallahassee, Florida 32301 Charles Stampelos, Esquire Post Office Box 2171 Tallahassee, Florida 32302
Alan C. Sundberg, Esquire Cynthia S. Tunnicliff, Esquire Post Office Drawer 190 Tallahassee, Florida 32302
Donna H. Stinson, Esquire The Perkins House
Suite 100
118 North Gadsden Street Tallahassee, Florida 32301
Information copies:
K. N. Ayers (DOAH) Nell Mitchem (PDCFR)
| Issue Date | Proceedings |
|---|---|
| Feb. 19, 1986 | Recommended Order (hearing held , 2013). CASE CLOSED. |
| Issue Date | Document | Summary |
|---|---|---|
| Jul. 23, 1986 | Agency Final Order | |
| Feb. 19, 1986 | Recommended Order | Certificate Of Need for short term psychiatric hospital. Need satisfied by access problems. |
