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HIALEAH HOSPITAL, INC. vs. DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES, 87-000262 (1987)

Court: Division of Administrative Hearings, Florida Number: 87-000262 Visitors: 11
Judges: WILLIAM R. DORSEY, JR.
Agency: Agency for Health Care Administration
Latest Update: Oct. 06, 1989
Summary: The issue is whether Hialeah Hospital, Inc. may be licensed for a 21-bed psychiatric unit, without first obtaining a certificate of need, on the basis that it provided psychiatric services before a certificate of need was statutorily required.Hospital failed to prove entitlement to grandfathering of psychiatric unit before Certificate Of Need regulation was put in place in 1983.
87-0262.PDF

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS


HIALEAH HOSPITAL, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 87-0262

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent, )

and )

) NEW DODGE MANAGEMENT CORPORATION,) d/b/a HARBOR VIEW HOSPITAL AND ) PALMETTO GENERAL HOSPITAL, )

)

Intervenors. )

)


RECOMMENDED ORDER


This matter was heard by William R. Dorsey, Jr., the Hearing Officer designated by the Division of Administrative Hearings in Tallahassee, Florida on February 16, 17, and 24, 1989.


APPEARANCES


For Hialeah Hospital Douglas L. Mannheimer, Esquire Inc.: BROAD & CASSEL

Post Office Drawer 11300

820 East Park Avenue, Building F. Tallahassee, Florida 32302-330


Timothy E. Monaghan, Esquire

JONES, FOSTER, JOHNSTON & STUBBS, P.A.

505 South Flagler Drive Post Office Drawer E

West Palm Beach, Florida 33402-3475


For Department of Leslie Mendelson, Esquire Health and Department of Health and Rehabilitative Rehabilitative Services Services: 2727 Mahan Drive, Suite 103

Tallahassee, Florida 32308


For Palmetto General Steven A. Ecenia, Esquire Hospital: ROBERTS, BAGGETT, LAFACE & RICHARD

Post Office Drawer 1838

101 East College Avenue Tallahassee, Florida 32302

STATEMENT OF THE ISSUE


The issue is whether Hialeah Hospital, Inc. may be licensed for a 21-bed psychiatric unit, without first obtaining a certificate of need, on the basis that it provided psychiatric services before a certificate of need was statutorily required.


PRELIMINARY STATEMENT


After the close of the hearing, a transcript of the hearing was filed, proposed findings of fact and conclusions of law were filed by June 12, 1989. Rulings on proposed findings of fact which have not been adopted are made in the Appendix to this Recommended Order.


FINDINGS OF FACT


  1. Background of the Controversy


    1. The Parties


      1. The Department of Health and Rehabilitative Services (the Department) is responsible for determining whether health care projects are subject to review under the Health Facility and Services Development Act, Sections 381.701- 381.715, Florida Statutes. It also licenses hospitals under Chapter 395, Florida Statutes. The Department's Office of Community Medical Facilities renders decisions about requests for grandfather status which would exempt a psychiatric service offered at hospital from certificate of need review. The Department's Office of Licensure and Certification issues licenses but does not grant grandfather exemptions. A hospital will not receive separate licensure for psychiatric beds unless a certificate of need has been obtained for those beds, or the beds are in a psychiatric unit which had been organized before certificate of need review was required. See Section 381.704(2), Florida Statutes (1987).


      2. A hospital can provide inpatient psychiatric services to a patient in one of three ways: a) as a patient housed among the general hospital population, b) as a patient housed in a special unit organized within the hospital and staffed by doctors, nurses and other personnel especially to serve patients with psychiatric diagnoses, or c) in a hospital organized as a psychiatric specialty hospital. Serving patients through methods b and c requires special certificate of need approval and licensure. Most community hospitals place psychiatric patients among the general patient population; few hospitals create a distinct psychiatric unit; fewer hospitals still specialize as psychiatric hospitals.


      3. Hialeah Hospital, Inc. is a 411-bed general hospital in Hialeah, Florida. It does not currently hold a certificate of need for licensure of a distinct psychiatric unit. As a result, its reimbursement for psychiatric services from the Federal government for Medicare patients is limited. The Health Care Finance Administration (HCFA) generally reimburses hospitals for services based upon flat rates which are paid according to categories known as diagnostic related groups. Hialeah Hospital now receives reimbursement for services it renders to psychiatric patients on this basis. If it is entitled to a grandfather exemption from certificate of need review, and its distinct psychiatric unit is separately licensed by the Department, Hialeah Hospital will receive cost-based reimbursement for services to psychiatric patients, which will result in higher income to the hospital. Approval of the grandfathering

        request will not result in a) any capital expenditure by the hospital, b) the addition of staff, or c) a change in the type of services currently offered at the hospital. Just before July 1, 1983, the hospital had an average daily census of 16-17 psychiatric patients. If the psychiatric services the hospital has offered do not qualify for grandfathering, Hialeah Hospital may apply for a certificate of need for a distinct psychiatric unit. Even without a psychiatric certificate of need, Hialeah is still entitled to continue to serve patients with psychiatric diagnoses among its general population, and to receive the lower diagnostic related group reimbursement for those services from HCFA.


      4. Palmetto General Hospital is a licensed general hospital with 312 acute care beds and 48 separately licensed psychiatric short-term beds operated as a distinct psychiatric unit. It is located near Hialeah Hospital, and both hospitals serve the same geographic area. The primary markets of both hospitals overlap. They compete for patients, including psychiatric patients.


    2. Agency Action Under Review


    1. From 1973 to 1979 the license issued to Hialeah Hospital by the Department bore a designation for 21 psychiatric beds, based on information submitted in the hospital's licensure application. The hospital then dropped the psychiatric bed count from its licensure applications. This change probably was caused by a problem generated by an announcement from the Northwest Dade Community Health Center, Inc., the receiving facility for psychiatric emergencies in northwestern Dade County, which includes Hialeah. That center had written to the Hialeah Police Department, informing the police that when the center was not open, it had a crisis worker at the Hialeah Hospital emergency room, and that persons needing involuntary psychiatric hospitalization should be taken to the Hialeah Hospital emergency room. The only other hospital in Hialeah treating psychiatric patients was Palmetto General Hospital, which did not accept, as a general rule, patients who could not pay for care. The Hialeah Police Department thereafter began dropping psychiatric patients at Hialeah Hospital, much to the distress of the Hialeah Hospital emergency room staff.

      The Hospital thereafter dropped the designation of any of its beds as psychiatric beds on its annual licensure applications. It still received psychiatric patients from Jackson Memorial Hospital when that hospital reached its capacity for psychiatric patients.


    2. On its 1980 licensure application Hialeah Hospital collapsed all of its medical, surgical and psychiatric beds into a single figure. This was consistent with its practice of serving medical, surgical and psychiatric patients throughout the hospital. Hialeah Hospital filed similar licensure applications in 1981, 1982, 1983. In 1984 there was a dispute over the total number of beds to be licensed, which was resolved in early 1985. In 1985, after a change in the licensing statute which is discussed below, the Department informed Hialeah Hospital that its application for licensure was incomplete and could not be processed until Hialeah explained its basis for seeking separate licensure for 20 short-term psychiatric beds. In its response, Hialeah's Vice President stated:


      [W]e felt it was appropriate to indicate that Hialeah Hospital did accept psychiatric admissions. These patients have been randomly placed in the institution, many times based on other primary or secondary diagnoses. The application indicates bed usage, not that

      it is currently a discrete unit. Hialeah Hospital does currently have a Letter of Intent [on file] for establishment of a discrete med/psych unit. Hialeah Ex. 24a


    3. On August 1, 1985, the Department's Office of Licensure and Certification informed Hialeah Hospital by certified mail that the application for licensure of 20 short-term psychiatric beds was denied for failure to have obtained a certificate of need for them or to have obtained an exemption from review [both could only come from the Department's Office of Community Medical Facilities]. The hospital was provided a clear point of entry to challenge this determination through a proceeding under Chapter 120, Florida Statutes, but Hialeah filed no petition for review of that decision. Instead, Hialeah pursued the certificate of need application which it had filed in April, 1985 for separately licensed psychiatric beds. There was no reason to challenge the August 1, 1985, denial because the factual bases alleged by the Department were true--the hospital had no certificate of need for psychiatric beds and had not yet asked the Department's Office of Community Health Facilities to decide whether Hialeah qualified for grandfathered beds. On October 21 and 23, 1986, Hialeah Hospital wrote to the Office of Community Health Facilities seeking a determination that it was entitled to have 21 pyschiatric beds grandfathered on its license.


    4. In certificate of need application 4025 Hialeah Hospital sought the establishment of a distinct 69 bed psychiatric unit at Hialeah, with separately licensed beds. The application went to hearing and was denied on its merits on February 17, 1987, in DOAH Case 85-3998. In his recommended order, the Hearing Officer discussed the issue of whether Hialeah Hospital was exempt from certificate of need review because it already had a psychiatric unit. He found that the issue was not appropriately raised in the proceeding before him, which was Hialeah Hospital's own application for a certificate of need to establish a psychiatric unit. He therefore found he lacked jurisdiction to consider the grandfathering issue. Hialeah Hospital v. HRS, 9 FALR 2363, 2397, paragraph 5 (HRS 1987). The Department adopted that ruling in its May 1, 1987, final order. Id. at 2365.


    5. A letter dated December 5, 1986, from the Office of Community Medical Facilities denied Hialeah's request to grandfather 21 short-term psychiatric beds on its license and thereby exempt them from certificate of need review, as requested in Hialeah's letters of October 21 and 23, 1986. The Department denied the grandfathering request for four reasons:


      1. When the Department conducted a physical plant survey on June 1, 1980, there were no psychiatric beds in operation at the hospital;

      2. The hospital bed count verification form returned to the Department on January 31, 1984 by the Director of Planning for Hialeah, Gene Samnuels, indicated that the hospital had no psychiatric beds;

      3. An inventory of psychiatric beds had been published by the Department in the Florida Administrative Weekly on February 17, 1984 which showed that Hialeah Hospital had no psychiatric beds, and Hialeah never contested that inventory;

      4. The Department had not received evidence demonstrating that psychiatric services were provided "in a separately set up and staffed unit between

        1980 and 1985."


        This letter again gave Hialeah a point of entry to challenge the Department's decision to deny licensure of psychiatric beds and it was the genesis of Hialeah's petition initiating this case. It is significant that the Department's Office of Community Health Facilities gave Hialeah a clear point of entry to challenge the December 5, 1986, grandfathering denial with full knowledge that the Department's Office of Licensure and Certification had denied a request from Hialeah Hospital on August 1, 1985, to endorse psychiatric beds on Hialeah's 1985 license. The Departmental personnel knew that those two denials involved different issues. Once the Office of Licensure and Certification told the hospital it had to produce either a certificate of need or a grandfathering approval to have psychiatric beds endorsed on its license, the hospital had to turn to the Office of Community Health Facilities to get a ruling on its grandfathering claim. The letter of December 5, 1986, was the first ruling on the merits of Hialeah Hospital's claim that it was entitled to have 21 beds grandfathered.


  2. History of the Department's Specialty Bed Recognition


    1. Psychiatric Beds in Florida Hospitals Before July 1, 1983


      1. Before April 1, 1983 no state statute or Department rule required that psychiatric beds in a hospital be located in physically distinct units. Psychiatric patients could be located throughout a hospital. They were not required to be placed in rooms having distinguishing characteristics, or to use group therapy rooms, dining rooms, or other rooms exclusively dedicated to use by psychiatric patients. There were, of course, hospitals that had distinct psychiatric units, and some entire hospitals which were specifically licensed as psychiatric hospitals. After 1983, a hospital had to obtain a certificate of need to organize what had previously been diffuse psychiatric services into a distinct unit dedicated to serving patients with psychiatric diagnoses. Today no special certificate of need is required to serve psychiatric patients in the general hospital population, but without separate licensure the hospital receives Medicare reimbursement from the federal government for psychiatric patients at the level established by the diagnostic related groups, not cost based reimbursement.


      2. Before July 1, 1983 annual hospital licensure application forms asked hospitals to identify their number of psychiatric beds as an item of information. The hospital licenses issued, however, were based on the hospital's total number of general medical-surgical beds, a category which included psychiatric beds.


    2. The 1983 Amendments to the Florida Statutes and the Department's Rules on Specialty Beds


      1. In April of 1983, the Department adopted a rule which established a separate need methodology for short-term psychiatric beds, Rule 10-5.11(1)(o), Florida Administrative Code. Thereafter, the Legislature amended the statutes governing the hospital licensing, Section 395.003, Florida Statutes (1983) by adding a new subsection (4) which read:

        The Department shall issue a license which specifies the number of hospital beds on the face of the license. The number of beds for the rehabilitation or psychiatric service category for which the Department has adopted by rule a specialty bed need methodology under s. 381.494 shall be specified on the face of the hospital license. All beds which are not

        covered by any specialty bed need methodology shall be specified as general beds. Section 4,

        Chapter 83-244, Laws of Florida (underlined language was added).


      2. In the same Act, the Legislature amended the planning law to require hospitals to apply for certificates of need to change their number of psychiatric and rehabilitation beds. Section 2, Chapter 83-244, Laws of Florida, codified as Section 381.494(1)(g), Florida Statutes (1983). The Department's rules defined short-term psychiatric services as:


        [A] category of services which provide a 24- hour a day therapeutic milieu for persons suffering from mental health problems which are so severe and acute that they need intensive, full-time care. Acute psychiatric inpatient care is defined as a service not exceeding three months and averaging a length of stay of 30 days or less for adults and a stay of 60 days or less for children and adolescents under 18 years. Rule 10- 5.11(25)(a), Florida Administrative Code (1983), effective April 7, 1983.


      3. A minimum size for any new psychiatric unit was prescribed in Rule 10- 5.11(25)(d)7., which states:


        In order to assure specialized staff and services at a reasonable cost, short-term inpatient psychiatric hospital based services should have at least 15 designated beds.

        Applicants proposing to build a new but separate psychiatric acute care facility and intending to apply for a specialty hospital license should have a minimum of 50 beds.


      4. After the effective date of the rule, April 7, 1983, no hospital could organize its psychiatric services into a distinct psychiatric unit using specialized staff unless the unit would have at least 15 beds. This did not mean that a hospital which already had organized a distinct psychiatric unit using specialized staff had to have at least 15 beds in its unit to continue operation. Whatever the number of beds, whether fewer or greater than 15, that number had to appear on the face of the hospital's license. Section 395.003(4), Florida Statutes (1983). To change that number, the hospital had to go through the certificate of need process. Section 381.494(1)(g) Florida Statutes (1983). Those hospitals whose pre-existing units were endorsed on their licenses can be

        said to have had those units "grandfathered". There is no specific statutory exemption from certificate of need review for pre-existing units, but such treatment is implicit in the regulatory scheme.


    3. The Department's Grandfather Review Process


      1. To know which hospitals were entitled to continue to operate discrete psychiatric units without obtaining a certificate of need, the Department's Office of Community Medical Facilities had to identify hospitals which had separate psychiatric units before the July 1, 1983, effective date of Section 395.003(4), Florida Statutes (1983). An inventory of beds in the existing psychiatric units also was necessary to process new certificate of need applications. The Department's rule methodology authorized additional beds in psychiatric units based upon a projected need of 15 beds per 10,000 population. Rule 10-5.11(25)(d)1., Florida Administrative Code (1983).


      2. The Legislature approved the psychiatric service categories which the Department had already adopted by rule when it enacted Section 4 of Chapter 83- 244, Laws of Florida. The Legislature thereby validated a process the Department had initiated in 1976 with its Task Force on Institutional Needs. That group had developed methodologies to be used throughout the state to determine the need for different types of medical services, because local health systems agencies were reviewing CON applications based upon idiosyncratic methodologies.


      3. To develop review criteria for psychiatric services, the Task Force had to both define psychiatric services and determine how it should measure them. In doing so, the Department looked for assistance to publications of entities such as the American Hospital Association and the Joint Commission on Accreditation of Hospitals. According to the American Hospital Association, psychiatric services are services delivered in beds set up and staffed in units specifically designated for psychiatric services. In the Task Force report, a psychiatric bed was defined as:


        A bed in a clinical care unit located in a short-term, acute care hospital or psychiatric hospital which is not used to provide long-term institutional care and which is suitably equipped and staffed to provide evaluation, diagnosis, and treatment of persons with emotional disturbances.

        An inpatient care unit or clinical care unit is a group of inpatient beds and related facilities and assigned personnel in which care is provided to a defined and limited class of patients according to their particular care needs.


        HRS Exhibit 14 at 92 and 1-5.


      4. The definition of a psychiatric bed in the Report of the Department Task Force on Institutional Needs is compatible with the requirements of the Florida Hospital Cost Containment Board in its Florida Hospital Uniform Reporting Manual. Reports made by hospitals to the Hospital Cost Containment Board include information about services provided in separately organized, staffed and equipped hospital units. The information provided to the Board assisted the Department in determining which Florida hospitals already were

        providing psychiatric services in separately organized, staffed and equipped hospital units before separate licensure became necessary.


      5. The Department surveyed hospitals to determine the number of existing beds in distinct psychiatric units. It also looked to old certificates of need which referenced psychiatric services at hospitals, reports hospitals had made to the Florida Hospital Cost Containment Board, to past licensure applications the Department had received from hospitals, and to the Department's 1980 physical plant survey.


      6. These sources of information were, however, imperfect, for the reasons which follow:


      1. Certificates of Need Issued


      22. Before July 1, 1983, certificates of need were required for the initiation of new services which involved capital expenditures above a certain threshold dollar amount. Hospitals which had a long-standing psychiatric units would have had no occasion to request a certificate of need for psychiatric services. Review of certificates issued would not turn up a hospital with a mature psychiatric service.


      2. Hospital Cost Containment Board Information


      23. The reports from hospitals during the early years of the Hospital Cost Containment Board are not entirely reliable, because the hospitals did not yet have uniform accounting systems in place, despite the Board's attempt to establish uniform accounting methods through its reporting system manual. Hospitals commonly made errors in their reports. If the reports were prepared correctly, they would identify hospitals with discrete psychiatric units. Hialeah's HCCB Reports for 1981, 1982 and 1983 indicated that the hospital had no active psychiatric staff, no psychiatric beds and no psychiatric services.


      3. Departmental Survey Letters


      24. In Spring, 1983, the Department tried to verify the existing inventory of beds for specialty services such as psychiatric services, comprehensive medical rehabilitation services and substance abuse services. There is no record, however, that this survey letter was sent to Hialeah Hospital. In late 1983 or early 1984, the Department again attempted to establish inventories for psychiatric beds and rehabilitation beds. It distributed a cover letter and a form entitled "Hospital Bed Count Verification", which asked hospitals to confirm the Department's preliminary count of the hospital's "number of licensed beds". Hialeah's planner returned the form verifying that Hialeah Hospital was licensed for 411 "acute general" beds and that it had no short or long term psychiatric beds. The answer was correct, for that is the figure which appeared on Hialeah's license at that time. The Department did not ask the hospitals for an average daily census of short-term psychiatric patients. The cover letter for the survey form told hospital administrators that the Department was seeking to verify its preliminary bed count for services for which a special bed need methodology had been established, viz., long and short term psychiatric beds, substance abuse beds and comprehensive medical rehabilitation beds. The cover letter drew attention to the Department's intention to use the data collected from the responses to the form as a beginning inventory for short-term psychiatric beds. The cover letter also cautioned hospitals that when completing the form, they should "keep in mind the service definitions". Copies of the definitions were attached to the form. The appropriate inference to be

      drawn from the answer given by Hialeah Hospital to the survey form was that in January, 1984, the hospital had no beds organized into a short term psychiatric unit. This is consistent with the later letter from the hospital's vice president quoted in Finding of Fact 6, above. The Department published on February 17, 1984, its base inventory of psychiatric and rehabilitation beds in the Florida Administrative Weekly. The publication stated that "any hospital wishing to change the number of beds dedicated to one of the specific bed types listed will first be required to obtain a certificate of need." 10 Florida Administrative Weekly at 493. Hialeah was shown as having no psychiatric beds. Id. at 498. The notice did not specifically inform the hospitals of the right to petition for a formal hearing to challenge the inventory figures published.


      4. Licensure Files


      25. Although, the Department's licensure application form listed "psychiatric" as a possible hospital bed utilization category before 1983, these categories were set up for informational purposes only. No definitions were given to hospitals describing how beds should be allocated among the categories available on the form, making those figures unreliable. Before 1980 Hialeah Hospital had listed psychiatric beds on its licensure applications, see Finding of Fact 5, above. Since 1980 it listed no psychiatric beds.


      5. Physical Plant Survey


      1. The Department performed a physical plant survey in 1980 to determine the total number of beds in service at each hospital. That survey did not attempt to make distinctions between different types of services listed on the survey form. The Department's architect who performed the survey did not attempt to evaluate the quality or intensity of the psychiatric services provided at any hospital.


      2. Each of the types of information the Department examined to determine the existing inventory of short-term psychiatric beds in 1983 had weaknesses, and no single source is dispositive. It is difficult to credit the assertion that Hialeah Hospital had a distinct psychiatric unit before July, 1983 which was not reflected in any of these sources of information. The use of multiple sources of information served as a cross-check on information from each source. It is understandable that Hialeah would not have applied for a certificate of need to operate a separate psychiatric unit. Before 1983, no such application was needed if the establishment of the unit entailed an expenditure of money below a threshold amount. All of its reports to the Hospital Cost Containment Board, however, indicate that there was no separate psychiatric service at the hospital and that the hospital had no active psychiatric staff. With respect to the Department's survey letters, while the 1984 survey form itself did not specifically inform hospital administrators that their responses would be used to establish a base inventory of psychiatric beds, the cover letter did make that clear. This should have put the hospital's planner, who filled out the form, on notice that if Hialeah had a discrete, short-term psychiatric service the number of beds in that unit should be listed. What is perhaps the most significant point is that the hospital reported no psychiatric beds on its licensure application at all from 1980 to 1985. Medical doctors in general practice can and do treat psychiatric patients, in addition to doctors who specialize in psychiatry. No doubt patients commonly were admitted to the hospital who had primary diagnoses of psychiatric illnesses. The hospital's licensure filings, however, since 1979 fail to record any psychiatric beds.

        This is important evidence that the hospital did not regard itself as having any distinct unit organized to provide psychiatric care. The Hospital's 1985

        correspondence from the Hospital's vice president to the Department, quoted in Finding of Fact 6 confirms this. The failure to list any psychiatric beds at Hialeah on the Department's 1980 physical plant survey is not significant, since determining the number of psychiatric beds was not the focus of that survey.


      3. It is true that the Department never conducted site visits at all hospitals to determine whether they had a) distinct psychiatric units, b) psychiatric medical directors, c) written psychiatric admission and treatment policies, or d) psychiatric policy and procedures manuals. The efforts the Department did make to establish the beginning inventory of psychiatric beds were reasonable, however


    4. Hialeah Hospital's Licensure History and Efforts to Obtain Grandfather Status


      1. The entries on Hialeah's applications for annual licensure from the Department are cataloged above, and need not be repeated. During the years 1980-84, after it ceased listing psychiatric beds on its licensure application, psychiatric services were still being provided to patients throughout the hospital. In 1984, the hospital engaged in correspondence with the Department over the appropriate number of licensed beds for the hospital as a whole. Ultimately the hospital and the Department agreed that 411 beds should be licensed. In its 1985 licensure application, Hialeah then requested that 20 short-term psychiatric beds be listed on the license. The Office of Licensure and Certification questioned this. Ultimately, the Office of Licensure and Certification refused to endorse those 20 psychiatric beds on the license because there was no certificate of need on file for them, nor any statement from the Office of Community Medical Facilities granting the hospital an exemption from that licensure requirement. Hialeah Hospital did not challenge that decision in a proceeding under Chapter 120, Florida Statutes. The discussions between the hospital and the Department's Office of Community Medical Facilities continued, and by late October, 1986, Hialeah requested the Department to approve 21 short-term psychiatric beds at the facility, and sent the Department backup material which it believed justified a grandfather determination. After review, the Department denied the grandfather request by letter dated December 5, 1986.


    5. The Department's Action Regarding Other Grandfathering Requests


      1. Hialeah's is not the first request the Department received for grandfathering beds. After June of 1983, when the Legislature required CON approval for hospitals to change their number of psychiatric or rehabilitation beds, a number of institutions made similar requests.


      1. Comprehensive Medical Rehabilitation Beds


      1. The rule on comprehensive medical rehabilitation beds was developed by the Department at the same time as the rule on psychiatric beds. The Department used a similar process to determine the existing inventory of both types of beds. The Department determined that preexisting comprehensive medical rehabilitation units at Parkway General Hospital, Naples Community Hospital, Orlando Regional Medical Center, Holy Cross Hospital, and University Community Hospital entitled those facilities to grandfathering of their comprehensive medical rehabilitation services. The Department has also determined that a preexisting distinct psychiatric unit at Palmetto General Hospital entitled that institution to grandfather status for its psychiatric beds.

        1. Parkway General


      2. Parkway General Hospital did not specify rehabilitation beds on its licensure applications for the years 1980 through 1984. The Department denied Parkway's request for endorsement of 12 comprehensive medical rehabilitation beds on its 1985 license because Parkway had not obtained a certificate of need for them or an exemption from review. The Department thereafter determined that Parkway had been providing comprehensive medical rehabilitation services before June, 1983 in a physically distinct and separately staffed unit consisting of 12 beds. It then endorsed 12 beds on Parkway's license, even though the rule which became effective in July, 1983 would require a minimum unit size of 20 beds for any hospital organizing a new comprehensive medical rehabilitation unit. See Rule 10-5.011(24), Florida Administrative Code.


        1. Naples Community Hospital


      3. The Department granted Naples Community Hospital a grandfather exemption for its rehabilitation beds in February, 1987. In had not listed the rehabilitation beds on its license application for the years 1983-1985, had not returned the Department's bed count verification form, nor did it challenge the bed count which the Department published in the Florida Administrative Weekly. The hospital had applied for and received a certificate of need in January of 1981 to establish a 22-bed rehabilitation unit and that unit began operation in late 1982. The Department ultimately determined that the hospital had provided rehabilitation services in a physically distinct unit and the services were organized and delivered in a manner consistent with applicable regulatory standards. It granted a grandfather request in February, 1987.


        1. Orlando Regional Medical Center


      4. A grandfather exemption for 16 rehabilitation beds was granted to Orlando Medical Center in 1986. The 16-bed brain injury unit had been authorized by the Department through certificate of need number 2114 before the Department had adopted its rule governing comprehensive medical rehabilitation beds in 1983. The services were provided in a physically distinct unit. The Department determined the 20-bed minimum size for a new unit did not apply to a unit which qualified for grandfathering.


        1. Holy Cross Hospital


      5. The Department granted a grandfather exemption for comprehensive medical rehabilitation beds to Holy Cross Hospital after a proceeding was filed with the Division of Administrative Hearings to require the Department to recognize the existence of a 20-bed comprehensive medical rehabilitation center. The Department determined by a site visit that Holy Cross had established a separate unit, probably in 1974, long before the Department's comprehensive medical rehabilitation unit rule became effective in July, 1983. The unit had its own policy manual, quality assurance reports, patient screening criteria, and minutes of multidisciplinary team staff conferences. The hospital had neglected to report the unit in its filings with the Hospital Cost Containment Board but the hospital contended that it never treated the unit as a separate unit for accounting purposes, and had not understood the need to report the unit as a distinct one under Hospital Cost Containment Board reporting guidelines. The hospital corrected its reporting oversight. The grandfathering is consistent with the hospital's actual establishment of the unit long before the Department's rules went into effect.

        1. University Community Hospital


      6. A dispute over whether to grandfather a comprehensive medical rehabilitation unit which went through a Chapter 120 administrative hearing and entry of a final order involved University Community Hospital (UCH). The Department initially determined that the nine comprehensive medical rehabilitation beds at UCH had been in existence before July, 1983 and were exempt from certificate of need review. That decision was challenged in a formal administrative proceeding by a competing hospital, Tampa General. The competitor was successful, for both the Hearing Officer in the recommended order and the Department in the final order determined that University Community Hospital's 9 bed rehabilitation unit was not entitled to be grandfathered. University Community Hospital v. Department of Health and Rehabilitative Services, 11 FALR 1150 (HRS Feb. 14, 1989). In determining that grandfathering was inappropriate, the Department found that the hospital had not prepared separate policies and procedures for its rehabilitation unit before the rule on comprehensive medical rehabilitation beds became effective, and that the unit did not have a physical therapy room on the same floor as the patients. The beds supposedly dedicated to rehabilitative care were mixed with non- rehabilitative beds, so that a semiprivate room might have one bed used for rehabilitative care and another for an unrelated type of care. This conflicted with the requirement that the rehabilitation unit be physically distinct, with all patients and support services located on the same area or floor, rather than scattered throughout the hospital. The Department also determined that many hospitals offer physical therapy, occupational therapy, or speech therapy, but that to qualify as a comprehensive medical rehabilitation center, these services had to be coordinated in a multidisciplinary approach to the patient's needs, which had not been the case at University Community Hospital.


      7. The common strand running through the grandfathering decisions on comprehensive medical rehabilitation beds is that grandfathering is appropriate when a hospital demonstrates that before the comprehensive medical rehabilitation rule became effective in July, 1983, it had a separate unit which met the standards and criteria for a comprehensive medical rehabilitation unit (other than the minimum size for new units).


      1. Psychiatric Beds


        1. Tampa General Hospital


          1. Only two cases involve a decision on whether psychiatric services at a hospital qualify for grandfathering. Tampa General Hospital, which was owned by the Hillsborough County Hospital Authority, operated 93 psychiatric beds in 1981, 71 at Hillsborough County Hospital and 22 at Tampa General Hospital. A certificate of need granted in 1981 authorized the expenditure of $127,310,000 for the consolidation of both hospitals and an overall reduction of 14 psychiatric beds after the hospitals were integrated.


          2. When the Hillsborough County Hospital Authority obtained its certificate of need, it was not necessary to differentiate between general acute care beds and psychiatric beds for licensure purposes. Increased demand for acute care beds led Tampa General to close its psychiatric unit and make those

            22 beds available for ordinary acute care. After the 1983 statutory and rule changes regarding the separate licensure of psychiatric beds, the Hillsborough County Hospital Authority told the Department that Tampa General had no psychiatric beds in operation. On its 1985 licensure application, the

            Hillsborough County Hospital Authority applied for licensure for 22 psychiatric beds at Tampa General and 77 at Hillsborough Hospital. The Department denied the request for the psychiatric beds at Tampa General. The Final Order entered in Hillsborough County Hospital Authority v. HRS, 8 FALR 1409 (Feb. 16, 1986), determined that there had been a discontinuation in the use of psychiatric beds at Tampa General, and that to allow Tampa General to add psychiatric beds after the statutory and rule changes in 1983 would frustrate the certificate of need process and would be detrimental to good health care planning.


        2. Palmetto General Hospital


      1. Palmetto General Hospital participated in an administrative hearing in 1975 regarding the disapproval of its proposed expansion, which included the dedication of one floor and 48 beds as a psychiatric unit. The Hearing Officer found that there was a need for psychiatric beds in the community and recommended that the Secretary of the Department issue a certificate of need "for that portion of the applicant's proposed capital expenditures relating to the addition of a 48 bed psychiatric unit". Palmetto General Exhibit 32, at 12, paragraph 2. The order of the Hearing Officer was affirmed by the District Court of Appeal in Palmetto General Hospital, Inc. v. Department of HRS, 333 So.2d 531 (Fla. 1st DCA 1976). The approval of the 48 psychiatric beds is clear only from a review of the Hearing Officer's order. Certificate of Need 292X was issued for the 48 psychiatric beds. Palmetto General exhibit 45. Palmetto received Medicare certification for its psychiatric inpatient unit, and listed

        48 short-term psychiatric beds on its licensure applications each year from 1979 to 1983. It failed to show its psychiatric beds on the bed count verification survey form sent by the Department. Palmetto General's chief financial officer told the Department on June 10, 1983 that Palmetto General did not have psychiatric beds in a separately organized and staffed unit. This resulted in the issuance of a license which showed no psychiatric beds. The Department itself wrote to the administrator of Palmetto to learn why the 48 short-term psychiatric beds had not been listed on Palmetto's application for licensure in 1985. Palmetto wrote back and acknowledged that it did have 48 short-term psychiatric beds. A license showing those 48 beds was then issued. Thereafter, staff from the HRS Office of Comprehensive Health Planning took the position that the 48 short-term psychiatric beds should not have been listed on the license, and the Department's Office of Licensure and Certification requested that the 1985 license containing the endorsement for those 48 psychiatric beds be returned to the Department for cancellation. Palmetto then sought an administrative hearing on the attempted cancellation of the license. Palmetto and the Department entered into a Final Order dated March 9, 1986 which agreed that Palmetto met all the requirements for the designation of 48 short-term psychiatric beds on its license.


      2. Palmetto, had, in fact, operated a 48 bed psychiatric unit on its third floor since 1981, but moved that unit to the sixth floor in 1985. It was dedicated exclusively to psychiatric patients and there were specific policy and procedure manuals developed and used in dealing with psychiatric patients since 1981.


      3. The history of Palmetto's licensure is certainly one replete with contradictions. It is inexplicable that the chief financial officer of the hospital would have told the Department in 1983 that it had no separately organized and staffed psychiatric unit when, in fact, it had such a unit. It was also unclear why it would have shown no psychiatric beds on the bed count verification form returned in late December or early January, 1984, or why its April, 1983, and its 1985/1986 license application forms listed no psychiatric

        beds. Nonetheless, it had obtained a certificate of need for a psychiatric unit after administrative litigation and an appeal to the District Court of Appeal.

        The unit was opened and remained continuously in existence. It had appropriate policies and procedures in place for a distinct psychiatric unit as the 1983 statutory and rule amendments required for separate licensure of psychiatric beds.


  3. History of Psychiatric Bed Services at Hialeah Hospital


  1. Since at least 1958, Hialeah Hospital has had psychiatrists on its medical staff, and the number of psychiatric physicians on staff has increased. Thirteen psychiatrists had admitting privileges at the hospital by 1983; there are now 23 psychiatrists with privileges. As is true with most community hospitals, physicians specializing in psychiatry would admit patients to the general population at Hialeah Hospital if they needed intensive psychotherapy or medication which needed to be monitored by nurses. Patients who were homicidal, suicidal or intensely psychotic were not admitted to Hialeah Hospital. Those patients need a more intensive psychiatric environment, either in a locked psychiatric unit or in a psychiatric specialty hospital. The persons physicians placed at Hialeah through 1983 did not need the intensive services of a discrete psychiatric unit.


  2. Hialeah Hospital indicated on its licensure application to the Department that it had 21 psychiatric beds throughout the 1970's, but ceased this listing in the 1980's as set forth in Finding of Fact 5 above. The nature of the services available at the hospital had remained constant. Under the psychiatric diagnosis coding system published in the Diagnostic Statistical Manual III, (which is commonly used by psychiatrists) Hialeah Hospital had an average daily census of 25 patients with primary or secondary psychiatric diagnoses in 1980, and 18 in 1981. Only about 25 percent of those patients had a primary psychiatric discharge diagnosis. The additional patients had secondary psychiatric diagnoses. Hialeah must rely on these secondary diagnoses to argue that its average daily census for psychiatric patients approached 21 beds.


  3. It was not until 1985 that Hialeah consolidated its psychiatric services to a medical/psychiatric unit. That unit serves patients with medical and psychiatric diagnosis as well as patients with solely psychiatric diagnoses. Before 1983, there was no medical director of psychiatry at Hialeah Hospital, and no separate policies and procedures for the admission of patients to a psychiatric unit, nor any staff dedicated to the care of psychiatric patients. To be sure, the hospital was in a position to provide quality psychiatric care to patients whose needs were psychotherapy, monitored medication, or individual counseling by psychiatric physicians and nurses. This reflects the reality that not all patients who need to be placed in the hospital for psychiatric care require the services of a separate medical/psychiatric unit. Patients with more acute psychiatric illness do need interdisciplinary approaches to their care. These interdisciplinary approaches are more expensive than serving psychiatric patients in the general hospital population. This is why the Federal government provides higher, cost-based reimbursement to the hospitals with specialty psychiatric licenses. Hialeah has not proven that the psychiatric services it was providing before 1983 were significantly different from those provided in typical community hospitals which did not have distinct psychiatric units.


  4. Hialeah's long-standing relationship with the Northwest Community Mental Health Center is not especially significant. Certainly, the Center was

    aware that Hialeah was a potential source of psychiatric care. Baker Act patients who needed hospitalization were taken there between 1980 and 1983. There was a flow of patients back and forth between the Center and the hospital's inpatient population, and discharge plans by Hialeah's social workers included referrals back to the Mental Health Center for follow-up and outpatient care. Similarly, the Dade-Monroe Mental Health Board knew that Hialeah was a potential provider of inpatient psychiatric services. The predecessor to the current local health council, the health systems agency of South Florida, recorded that there were psychiatric admissions at Hialeah Hospital in the early 1980's, and the health systems agency recommended a conversion of existing beds to psychiatric services because of a need for additional psychiatric services in the area. None of this, however, means that Hialeah had operated a distinct psychiatric unit before 1983 which entitles it to grandfather status.


    CONCLUSIONS OF LAW


  5. The Division of Administrative Hearings has jurisdiction over this matter. Section 120.57(1), Florida Statutes (1987). University Community Hospital v. HRS, 11 FALR 1150 (HRS Feb. 14, 1989). The issues of law to be resolved in this case are:


    1. Does Palmetto General Hospital have standing to participate in a hearing to determine whether Hialeah Hospital is entitled to licensure of 21 short-term psychiatric beds when no certificate of need has been awarded for those beds?


    2. Did Hialeah Hospital waive a clear point of entry to contest the determination that Hialeah is not entitled to 21 short-term psychiatric beds because it failed to petition for review of the Department's rejection of its application for grandfather status of its psychiatric unit on August 1, 1985?


    3. Is Hialeah barred by collateral estoppel from raising the issue whether it is entitled to licensure of 21 short-term psychiatric beds based on the findings of fact or conclusions of law made in its prior application to convert 69 medical surgical beds to psychiatric beds?, and


    4. Is Hialeah entitled to licensure of 21 short-term psychiatric beds without participating in certificate of need a review for those beds because it operated a short-term psychiatric unit before July, 1983?


      Palmetto's Standing


  6. Palmetto has standing to participate in this proceeding. It is an existing provider of psychiatric services in District 11 which would be adversely affected by the licensure of psychiatric beds at Hialeah Hospital. In University Community Hospital v. HRS, 11 FALR 1150 (HRS Feb. 14, 1989) the Department permitted Tampa General Hospital to challenge the Department's preliminary decision to exempt nine comprehensive medical rehabilitation beds at University Community Hospital from CON review. That precedent controls the standing issue here. See also, Baptist Hospital v. Department of Health and Rehabilitative Services, 500 So.2d 620, 625 (Fla 1st DCA 1986).


    Hialeah's Clear Point of Entry in 1985


  7. Hialeah's October, 1986, request for grandfathering of its psychiatric beds was accepted for review by the Department's Office of Community Health Facilities. When that request was denied in a letter dated December 5, 1986,

    the Department explicitly granted Hialeah the opportunity for formal review of the decision under Chapter 120, Florida Statutes. The Departmental employee who prepared the December 5, 1986, denial letter also knew of the prior letter the Department's Office of Licensure and Certification had written to Hialeah on August 1, 1985, declining to license any psychiatric beds because the hospital had not produced a certificate of need for them, or evidence that they should be grandfathered. If the Department believed that its August, 1985, letter precluded another request from Hialeah for review of the grandfathering issue, it would have been more sensible to have rejected Hialeah's October, 1986, grandfathering request as soon as it was received. Instead, the Department granted Hialeah a point of entry to challenge its 1986 grandfathering decision. That decision was correct, for the refusal by the Office of Licensure and Certification to endorse 20 psychiatric beds on the 1985 license was based on the lack of any ruling by the Department's Office of Community Medical Facilities on whether the hospital qualified for grandfathering. The August 1, 1985, denial had not been based on any substantive decision by the Office of Community Medical Facilities that the hospital did not qualify for grandfathering of psychiatric beds. That decision is no bar to this proceeding.


    Collateral Estoppel


  8. In the course of administrative litigation on Hialeah's earlier application to convert 69 medical surgical beds to psychiatric beds in DOAH Case No. 85-3998, Hialeah did raise the issue of whether some of those beds were entitled to licensure by grandfathering. The Hearing Officer in that case concluded in his recommended order that he lacked jurisdiction to consider the grandfathering issue. The Department adopted that ruling in its Final Order. Hialeah Hospital, Inc. v. HRS, 9 FALR 2363 (HRS 1987). That ruling is not a ruling on the merits of the grandfathering issue. Collateral estoppel can only bar re-litigation of a matter which a prior tribunal had jurisdiction to decide. Collateral estoppel does not bar Hialeah from litigating the grandfather issue here.


    The Merits of the Grandfathering Claim


  9. The 1983 amendments to the certificate of need law did two things. It required the Department to endorse on the face of a hospital license the number of approved psychiatric or comprehensive medical rehabilitation beds and it required hospitals to go through certificate of need review for any change in the number of those beds. Sections 2 and 4, Chapter 83-244, Laws of Florida, codified as Sections 381.494(1)(g) and 395.003(4), Florida Statutes (1983). The requirement to obtain a certificate of need for new psychiatric beds had prospective effect. It did not apply to preexisting beds. Short-term psychiatric units which hospitals operated on July 1, 1983 were entitled to grandfathering, i.e., to endorsement on the face of the hospital's license without requiring the hospital to go through the certificate of need review process.


  10. The more credible and persuasive evidence has proven that before July, 1983, Hialeah did not have what would have been recognizable as a psychiatric unit at its hospital. It merely had patients with primary or secondary psychiatric diagnoses intermingled in the general hospital population. Review of the decisions of the Department concerning exemptions from certificate of need review for comprehensive medical rehabilitation beds and for psychiatric beds shows that the Department consistently has granted exemptions only when a hospital has demonstrated that before the effective date of the psychiatric bed or comprehensive medical rehabilitation bed rule in 1983, the facility already

    had established a distinct unit for those services. If a hospital had a psychiatric unit in the past, but discontinued utilization of those beds for psychiatric patients, the hospital could reestablish a psychiatric unit only after going through the CON review process. Hillsborough County Hospital Authority v. HRS, 8 FALR 1409 (HRS Feb. 17, 1986).


  11. A decision of the District Court of Appeal affirmed an administrative decision made in 1975 that Palmetto General Hospital was eligible for a certificate of need for 48 psychiatric beds. Palmetto constructed and operated a short-term psychiatric unit which was separately organized and staffed before the 1983 rule and statutory amendments came into effect. By contrast, Hialeah has not proven that it had a separately organized and staffed psychiatric unit before 1985.


  12. Hialeah Hospital is correct when it points out that the definition for short-term hospital inpatient psychiatric services, Rule 10-5.11(25)(a), Florida Administrative Code (1983) only describes services and does not specifically require that they be provided in a distinct unit. That definition states:


    Short-term hospital inpatient psychiatric services means a category of services which provide a 24-hour-a-day therapeutic milieu for persons suffering from mental health problems which are so severe and acute that they need intensive, full-time care. Acute psychiatric inpatient care is defined as a service not exceeding 3 months and averaging a length of stay of 30 days or less for adults and a stay of 60 days or less for children and adolescents under 18 years.


    The requirement of a distinct unit is embedded in the concepts of a "24-hour a day therapeutic milieu", and the severity of the patient's condition being such that "intensive, full time care" is needed. These portions of the definition are meant to describe much more than treating a patient among the general hospital population. There is an express requirement that a psychiatric unit have at least 15 beds, in Rule 10-5.11(25)(d)7., Florida Administrative Code (1983), which sets a minimum size for new units. It shows that a separate unit is contemplated by the rule. The entire process established by the 1983 rule and statutory amendments makes no sense unless the rule is interpreted to apply to distinct units. All community hospitals could serve persons needing short- term inpatient hospitalization for psychiatric care. Those patients would receive counseling or have necessary medication administered and monitored by medical and nursing staffs. This low-intensity type of hospitalization would not require interdisciplinary efforts among separate hospital staff. There is nothing in Chapter 83-244, Laws of Florida, which intimates that the Legislature intended that community hospitals be licensed for a number of psychiatric beds equal to its average daily census of patients with primary or secondary psychiatric diagnoses, regardless of whether those patients were served in a separately organized psychiatric unit. It is also significant that the statute essentially ratified or adopted the psychiatric bed rule which HRS had already adopted in April, 1983. The legislation was designed to restrict the establishment of discrete psychiatric units, i.e. units which had separate staff, their own medical director, and nurses and other support staff dedicated to psychiatric care. It did not restrict or limit the availability of psychiatric care to patients who would benefit from treatment in the general hospital population.

  13. This case is analogous to that of Baptist Hospital v. HRS, 500 So. 2d 620 (Fla. 1st DCA 1987). Rehabilitation beds were regulated in the same law which required separate licensure for psychiatric beds. The regulatory framework for psychiatric services and comprehensive rehabilitation services is quite similar. Baptist Hospital sought licensure for comprehensive medical rehabilitation beds without obtaining a certificate of need approval, based on grandfathering. 1/ The Hearing Officer found that Baptist Hospital had provided its patients with services of the type covered by the specialty bed need rule for comprehensive medical rehabilitation beds during the preceding twelve months, and recommended that Baptist's beds be exempt from certificate of need review. Id. at 623. The Department adopted the Hearing Officer's findings of fact but rejected his interpretation of the rule, and found that to be grandfathered it was necessary for the medical rehabilitation service to have been offered in a distinct unit, as opposed to offering rehabilitation services in different areas of the hospital. The rule governing comprehensive medical rehabilitation beds describes the manner of providing services as those provided "in a unit". Rule 10-5.011(24)(b) [now renumbered Rule 10-5.011(n)2.], Florida Administrative Code. The court affirmed the Department's Final Order and held that "the manner in which [rehabilitation] services were provided involved overriding agency consideration and it is therefore reserved to agency discretion." Id., 500 So. 2nd, at 624. The District Court of Appeal has deferred to the agency's interpretation of its rules in a situation closely analogous to the one at hand, and similar deference is appropriate here.


  14. Hialeah certainly had beds occupied by patients with psychiatric diagnoses but they were not receiving services of the type described in Rule 10- 5.11(25), Florida Administrative Code (1983). They are not beds which the Department must endorse upon the face of Hialeah Hospital's license now as psychiatric beds. Hialeah can continue to provide those services which it provided to its psychiatric patients before July 1, 1983. It was eligible to be paid for those services through Federal programs such as Medicare, and it still is entitled to be paid for those services by HCFA at the rates set for the diagnostic related groups applicable to the patients' diagnoses.


RECOMMENDATION


It is recommended that the application of Hialeah Hospital for grandfather status for 21 short-term psychiatric beds, and the inclusion of those short-term psychiatric beds on its license and on the Department's bed inventory be denied.


DONE AND ENTERED this 6th day of October, 1989, in Tallahassee, Leon County, Florida.


WILLIAM R. DORSEY

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, FL 32399-1550

(904) 488-9675


Filed with the Clerk of the Division of Administrative Hearings this 6th day of October, 1989.


ENDNOTE


1/ The issue framed in the opinion is whether a "substantial change in services" was involved in Baptist's operation of those comprehensive medical rehabilitation beds. This is merely another way of expressing the grandfathering issue.


APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-0262


The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes (1987), on the proposed findings of fact submitted by the parties in this case.


Rulings on Proposed Findings of Fact Submitted by Hialeah Hospital, Inc.


  1. Accepted in finding of fact 1.

  2. Accepted in finding of fact 3.

  3. Accepted in findings of fact 2, 3 and 45.

  4. Accepted in finding of fact 4.

  5. Accepted as modified in findings of fact 6, 7, and 29.

  6. Adopted as modified in finding of fact 8.

  7. Adopted as modified in finding of fact 9.

  8. Adopted as modified in finding of fact 9.

  9. Adopted in finding of fact 11.

  10. Adopted in finding of fact 2, except for the first sentence, which is unnecessary.

  11. Adopted as modified in finding of fact 12 and to the extent appropriate, in findings of fact 17 through 19.

  12. To the extent appropriate, covered in finding of fact 18.

  13. To the extent appropriate, covered in finding of fact 18.

  14. Adopted in finding of fact 13.

  15. Adopted in finding of fact 14.

  16. Adopted as modified in findings of fact 13 and 14 as it relates to psychiatric beds.

  17. To the extent appropriate, covered in finding of fact 15.

  18. Adopted to the extent appropriate in finding of fact 14.

19-20. Generally rejected as unnecessary, but see finding of fact 14.

  1. Covered in finding of fact 15 and, to some extent, finding of fact 37 as it relates to the treatment of minimum unit sizes. Comprehensive rehabilitation facilities are treated similarly to psychiatric facilities.

  2. To the extent appropriate, covered in findings of fact

    2 and 3.

  3. Implicit in finding of fact 16.

  4. Adopted in finding of fact 20.

  5. (a) Adopted as modified in finding of fact 22.

    1. Adopted as modified in finding of fact 23.

    2. Adopted as modified in finding of fact 24.

    3. Adopted as modified in finding of fact 25.

    4. Adopted as modified in finding of fact 26.

  6. Adopted as modified in finding of fact 26.

  7. Implicit in findings of fact 33 and 27; to the extent necessary, discussed in finding of fact 24.

  8. Implicit in findings of fact 30 through 42.

  9. To the extent appropriate, dealt with in finding of fact 28.

  10. Dealt with in finding of fact 28.

  11. Adopted in finding of fact 24.

  12. Generally rejected as unnecessary; to the extent appropriate covered in findings of fact 15 and 37.

  13. Discussed in finding of fact 5. There was never any reason for the Department to protest the figure included for psychiatric beds, as they were not separately regulated at that time.

  14. Discussed in findings of fact 5 and 6. Testimony about the reasons given by the health planner for not separately listing the psychiatric beds is not persuasive. The more likely cause, which can be inferred from the documentary evidence, was the difficulty Hialeah Hospital was experiencing

    in receiving Baker Act patients brought to its emergency room by the Hialeah Police Department. The hospital wanted to downplay its psychiatric services to minimize or avoid police "dumping" of patients in its emergency room. The hospital did serve patients with psychiatric diagnosis throughout the hospital.

  15. Adopted as modified in findings of fact 6 and 29.

  16. Adopted as modified in finding of fact 27.

  17. Generally rejected as unnecessary but discussed in finding of fact 29.

  18. Adopted as modified in finding of fact 29.

  19. Rejected as argument.

  20. Adopted as modified in finding of fact 26.

  21. See finding of fact 6, and the letter quoted in it, as well as finding of fact 8.

  22. Rejected as unnecessary.

  23. Findings with respect to the accuracy of the content of CON application 4025 are rejected as unnecessary.

  24. Adopted as modified in finding of fact 8.

  25. Generally discussed in finding of fact 30; see also finding of fact 9.

  26. Rejected as unnecessary. Information derived from HCCB reports was only one factor, and not dispositive on the issue of grandfathering. See finding of fact 27.

47-48. Considered and discussed in findings of fact 40 through 42.

  1. Adopted as modified in finding of fact 32.

  2. Adopted as modified in finding of fact 34.

  3. Adopted as modified in finding of fact 33. 52-53. Adopted as modified in finding of fact 36.

  1. Adopted as modified in finding of fact 35.

  2. To the extent appropriate covered in finding of fact 5. Whether or not Hialeah received overflow psychiatric patients from Jackson Memorial has nothing to do with whether those patients were treated in the general

population, without a distinct psychiatric unit. There was no distinct unit before 1985. See finding of fact 45.

56-57. Adopted as modified in finding of fact 43.

  1. Rejected because in the absence of integrated interdisciplinary treatment of a patient, that patient does not receive a "24-hour a day therapeutic milieu" for mental health problems, even though he may reside in a general acute care hospital bed, interspersed in the general hospital population.

  2. Rejected because it's unclear what it would mean for Hialeah to "hold out to the community" the availability of 21 beds for psychiatric care. The hospital did have an average daily census of approximately 21 persons with primary or secondary psychiatric diagnosis, but these persons did not need the intensive psychiatric environment of a distinct psychiatric unit, a locked psychiatric unit or a psychiatric specialty hospital. See finding of fact 43.

  3. Rejected as unnecessary. The number of patient days, average daily census, or average length of stay have nothing to do with the question whether there was a distinct psychiatric unit. No doubt the hospital had the average daily census for persons with primary or secondary psychiatric diagnosis as proposed in Hialeah's table in proposed finding of fact 60.

61-62. Rejected for the reasons given for rejecting proposed finding 60.

  1. Rejected as unnecessary. These facts do not show a distinct unit. Such a unit was not organized until 1985. See finding of fact 45.

  2. Rejected because whether or not patients of Hispanic or other extraction wish to avoid the stigma of being a psychiatric patient has nothing to do with whether Hialeah Hospital had a separate psychiatric unit. The rule requires such a unit, not some reason for not having a distinct unit, such as patient aversion to placement in a distinct unit.

  3. It is correct that quality psychiatric services were provided to patients at Hialeah Hospital in a non- discrete manner before 1983. The remaining proposed findings are rejected as unnecessary.

  4. Rejected as unnecessary; while it is true that the attending psychiatrist directed and supervised the care of patients who were admitted to the hospital and coordinated the various services provided to the patient (TR. 111-12), that should be true about any patient at a hospital, with any diagnosis. Those patients scattered. TR 111. No members of a multidisciplinary team charted their participation in a patients care. TR 204. The absence of separate admission and discharge policies before 1983 is further evidence that psychiatric services were not provided in a distinct unit.

  5. Rejected as unnecessary; nurses commonly receive in- service training at hospitals. It is not surprising that those training sessions covered psychiatric

    topics. The availability of such training is not proof of a distinct psychiatric unit.

  6. Rejected as unnecessary. 69-70. See finding of fact 46.

  1. Rejected as unnecessary. That Hialeah was providing psychiatric services says nothing about the matter in which those services were provided.

  2. Adopted as modified in finding of fact 45.


Rulings on Proposed Findings of Fact Submitted by Palmetto General Hospital

and

the Department of Health and Rehabilitative Services.


  1. Adopted as modified in finding of fact 1.

  2. Adopted as modified in finding of fact 3.

  3. Adopted as modified in finding of fact 4.

  4. Adopted as modified in findings of fact 5 and 6.

  5. Adopted as modified in finding of fact 6.

  6. Adopted as modified in finding of fact 7.

  7. Covered in findings of fact 6, 7, and 8 to the extent necessary. The findings drawn from the April 15, 1985 CON application are rejected as subordinate to the finding that no distinct psychiatric unit was organized at Hialeah before 1985.

  8. Discussed in finding of fact 8.

  9. Discussed in findings of fact 7, 10 and 29.

  10. Discussed in finding of fact 2, and, to some extent finding of fact 22.

  11. Discussed in findings of fact 13, 14 and 15.

  12. Discussed in finding of fact 15.

  13. See findings of fact 17, 18, 19 and 20.

  14. Adopted as modified in finding of fact 18.

  15. Adopted as modified in finding of fact 19.

  16. Adopted as modified in finding of fact 23.

  17. Adopted as modified in finding of fact 22.

  18. Adopted as modified in findings of fact 6 and 25.

  19. See finding of fact 26.

20-22. Adopted as modified in finding of fact 24.

  1. Rejected as unnecessary.

  2. Implicit in finding of fact 17; refers to the rule adopted by the Department defining psychiatric services.

  3. Adopted as modified in finding of fact 2.

  4. To the extent necessary, covered in findings of fact 2, 3 and 45.

  5. Discussed in finding of fact 31.

  6. Adopted as modified in finding of fact 32.

  7. Adopted as modified in finding of fact 33.

  8. Adopted as modified in finding of fact 34.

  9. Adopted as modified in finding of fact 35.

  10. Adopted as modified in finding of fact 36.

  11. Discussed in finding of fact 36 to the extent necessary.

  12. Discussed in finding of fact 37.

  13. Discussed in finding of fact 38.

  14. Adopted as modified in findings of fact 38 and 39.

  15. Discussed in finding of fact 39, to the extent necessary.

  16. Discussed in finding of fact 39.

39-40. Adopted as modified in finding of fact 40.

  1. Implicit in finding of fact 40, though the proposed finding with respect to the expenditure of money by the federal Department of Health Education and Welfare is unnecessary.

  2. Adopted in finding of fact 40.

  3. Adopted in findings of fact 40 and 42.

  4. Rejected as unnecessary.

45-48. Discussed in finding of fact 40 to the extent necessary.

  1. Subordinate to the finding made in finding of fact 41.

  2. Adopted as modified in finding of fact 45.

  3. Rejected as unnecessary.

  4. Covered in findings of fact 43 and 45.

  5. Rejected as unsupported. The proposed finding is probably meant to relate to psychiatric diagnoses in 1983. See TR. 451. Hialeah exhibit 88, is not persuasive, in large part due to the testimony of Mr. Pannell; he did not see the number of psychiatric records for 1983 which should have been available if exhibit 88 is correct. Moreover, the exhibit includes both primary and secondary diagnosis. It gives no indication of the acuity of the psychiatric services required for a secondary psychiatric diagnosis, which may be quite modest.

  6. Discussed in finding of fact 6. To some extent see also findings of fact 5 and 3.

  7. Adopted in finding of fact 6. The second two sentences are rejected as unnecessary.

  8. Rejected because it is not significant that Hialeah Hospital provided Baker Act services. This does not indicate whether it is a discrete psychiatric unit.

  9. Rejected as argument.

  10. See reasons for rejecting finding of fact 56.

  11. Adopted as modified in finding of fact 45.

  12. Discussed in findings of fact 3 and 45.

  13. Discussed in finding of fact 3.


COPIES FURNISHED:


Douglas L. Mannheimer, Esquire BROAD & CASSEL

Post Office Drawer 11300

820 East Park Avenue, Building F. Tallahassee, Florida 32302-330


Timothy E. Monaghan, Esquire JONES, FOSTER, JOHNSTON

& STUBBS, P.A.

505 South Flagler Drive Post Office Drawer E

West Palm Beach, Florida 33402-3475

Leslie Mendelson, Esquire Department of Health and Rehabilitative Services 2727 Mahan Drive, Suite 103

Tallahassee, Florida 32308


Steven A. Ecenia, Esquire ROBERTS, BAGGETT, LAFACE & RICHARD

Post Office Drawer 1838

101 East College Avenue Tallahassee, Florida 32302


Sam Power, Agency Clerk Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32399-0700


Gregory L. Coler, Secretary Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32399-0700


John Miller, General Counsel Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32399-0700


Docket for Case No: 87-000262
Issue Date Proceedings
Oct. 06, 1989 Recommended Order (hearing held , 2013). CASE CLOSED.

Orders for Case No: 87-000262
Issue Date Document Summary
Dec. 13, 1989 Agency Final Order
Oct. 06, 1989 Recommended Order Hospital failed to prove entitlement to grandfathering of psychiatric unit before Certificate Of Need regulation was put in place in 1983.
Source:  Florida - Division of Administrative Hearings

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