STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

HERNANDO-PASCO HOSPICE, INC., )

)

Petitioner, )

)

vs. ) Case No. 00-1067

)

AGENCY FOR HEALTH CARE )

ADMINISTRATION, )

)

Respondent, )

)

and )

) LIFEPATH, INC., d/b/a LIFEPATH ) HOSPICE, )

)

Intervenor. )

)

RECOMMENDED ORDER

This case was heard by David M. Maloney, Administrative Law Judge of the Division of Administrative Hearings, from

January 17, 2001, through January 23, 2001, in Tallahassee, Florida.

APPEARANCES

For Petitioner: Gerald B. Sternstein, Esquire

Frank P. Rainer, Esquire Sternstein, Rainer & Clarke, P.A.

101 North Gadsden Street Tallahassee, Florida 32301

For Respondent: Richard A. Patterson, Esquire

Agency for Health Care Administration 2727 Mahan Drive

Fort Knox Building Three, Suite 3431 Tallahassee, Florida 32308-5403

For Intervenor: H. Darrell White, Esquire

McFarlain, Wiley, Cassedy & Jones, P.A.

215 South Monroe Street, Suite 600 Post Office Box 2174

Tallahassee, Florida 32316-2174

STATEMENT OF THE ISSUE

Whether the numeric need for hospice programs in health planning subdistrict 6A for the March 2000, batching cycle should be one, as originally published by the Agency for Health Care Administration, or zero, as published in a revision of the original publication?

PRELIMINARY STATEMENT

On March 9, 2000, the Division of Administrative Hearings (Division) received a notice from the Agency for Health Care Administration ("AHCA" or the "Agency"). Dated two days earlier, the notice advised the Division that it had received a request for a formal administrative hearing from Hernando-Pasco, Inc.

Attached to the notice was a copy of Hernando-Pasco's request. Denominated a petition for formal administrative hearing, the petition contests the revision of a published fixed need pool in health planning subdistrict 6A (Hillsborough County) for hospice programs. The revision reduced the sub-district's numeric need from one as originally published to zero.

The notice from the Agency also requested that the Division assign the matter to an administrative law judge to conduct all proceedings required by law and to submit a recommended order to

the Agency. The request was granted. The matter was assigned Case No. 00-1067, the undersigned was designated as the administrative law judge to conduct the proceedings, and an initial order was issued.

Pursuant to a response to the initial order, the case was placed in abeyance until July 15, 2000. Eventually, the case was consolidated with Case Nos. 00-3203 and 00-3205, an order of pre- hearing instructions was issued and the consolidated cases were set for hearing in November 2000. In the meantime, LifePath, Inc.'s petition to intervene was granted. LifePath, in turn, moved for a continuance. The motion was granted. Final hearing was reset for January 17, 2001, and commenced as scheduled.

At the hearing, Hernando-Pasco presented the testimony of: Mr. Rodney Taylor, expert in hospice administration and operations; Dr. David McGrew, expert in physician services for hospices; Ms. Kim Smith, expert in nursing and hospice nursing administration; Ms. Rosemarie Milks, expert in administration of hospice branch offices; Mr. Tom Beason, expert in hospice bereavement programs; and Ms. Sharon Gordon-Girvin, expert in health care planning. Hernando-Pasco Exhibits 4-18, 20-31, pages 62-66 of Exhibit 32, Exhibit 33 and portions of Exhibit 1 were received into evidence. Hernando-Pasco Exhibit 19 was rejected and proffered.

LifePath presented the testimony of Ms. Kathy Fernandez, expert in hospice administration and hospice clinical administration and Mr. Jay Cushman, expert in health care planning. LifePath Exhibits 6-34 were received into evidence. The Agency presented the testimony of Mr. Jeffrey N. Gregg, expert in health care planning. AHCA's Exhibit 1 was received in evidence. Official recognition was taken of Rule 59C-1.008(2), Florida Administrative Code, marked as OR Ex. 1.

During the hearing, pursuant to an ore tenus motion by the

parties, Case No. 00-1067 was severed from Case Nos. 00-3203 and 00-3205. The two latter cases were placed in abeyance and hearing proceeded to conclusion on Case No. 00-1067.

The transcript of the hearing was filed on February 22, 2001. The parties submitted proposed recommended orders on April 13, 2001. The proposals were timely filed.

FINDINGS OF FACT

1. The Parties

   
   

   1. Petitioner, Hernando-Pasco Hospice, Inc., was formed in 1982 and commenced service in 1984. It is licensed to provide hospice services in Service Areas 3D and 5A, Hernando and Pasco Counties, respectively. On average, it serves 500 patients per

      day.

      
      

   2. Hernando-Pasco has three offices for the delivery of

      
      

      care in its service areas. It operates three hospice residential

      houses with a total of 23 beds. The houses are in Hudson, Dade City, and Spring Hill. Hernando-Pasco also operates an inpatient unit at a nursing home in Brooksville serving Hernando County.

   3. LifePath Hospice is a not-for-profit community organization founded in 1983. It is licensed to provide hospice services in two service areas, 6A and 6B. Service Area 6A is Hillsborough County. Service Area 6B is comprised of three counties: Polk, Highlands, and Hardee. LifePath serves 820 patients on an average daily basis. In calendar year 2000, it served 4,002 patients.

   4. LifePath provides hospice service without regard to the patient's ability to pay. The services are provided, moreover, regardless of the circumstances in which the patient is found so long as the patient is in Service Area 6A or 6B. For example, services are provided to the patient whether at home, in another residential setting, in an inpatient facility such as a hospital or even if homeless. In other words, LifePath provides hospice service to patients wherever the patient might be within LifePath's two service areas.

   5. Similarly, Hernando-Pasco Hospice provides its hospice services to hospice patients at home, in residential settings, and in in-patient settings. It does not matter in what setting the hospice patient is found at the time of the request for hospice services as long as the patient is located within the

      service areas where Hernando-Pasco Hospice is authorized to provide its services. Hernando-Pasco delivers services within its authorized service areas "wherever the patient may be." (Tr. 64). Hospice services are also delivered by Hernando-Pasco Hospice to the homeless, although requests by the homeless for

      hospice services tend to be few. As Mr. Taylor, CEO of Hernando- Pasco Hospice explained at hearing:

      Fortunately, the few of them [the "homeless"] are able to go to an adequate facility, but some of them prefer to live in cardboard boxes . . . things of that nature. We go where they are.

      
      

      * * *

      
      

      [I]f they want to be living in a cardboard box, we will take service to that cardboard box for them.

      
      

      (Tr. 248, 249).

      
      

   6. The Agency for Health Care Administration is the single state agency responsible for the administration of certificate of need laws in Florida. In conjunction with these duties, it determines semi-annually the net numeric need for new hospice programs pursuant to Rule 59C-1.0355, Florida Administrative Code ("the Rule.")

2. Numeric Need Under The Rule

   
   

   1. Rule 59C-1.0355, Florida Administrative Code, entitled "Hospice Programs" was adopted on April 17, 1995. Its purpose is to ensure "the availability of hospice programs as defined in

      this rule to all persons requesting and eligible for hospice services, regardless of ability to pay." Rule 59C-1.033(1), Hernando-Pasco Ex. 9. The Rule establishes criteria and standards for assessing the need for new hospice programs. For determining whether a new hospice is needed in a service area, the Rule includes a numeric need formula.

   2. The numeric need formula contains two terms: "HPH" and "HP." "HPH" is defined as "the projected number of patients electing a hospice program in the service area during the 12- month period beginning at the planning horizon." (Hernando Ex. 9). "HP" is defined as "the number of patients admitted to hospice programs serving a service area during the most recent 12-month period ending on June 30 or December 31. (Id.)

   3. If the number of patients denoted as HPH exceeds the number denoted by HP by 350 or more, then a numeric need is indicated for the service area. The formula is expressed as:

      HPH - HP > 350

      
      

      [Rule 59C-1.0355(4)(a), Hernando-Pasco Ex. 9].

      
      

   4. The "350" figure in the Rule's numeric need formula "is a threshold value to determine whether any difference that may exist between HPH and HP rises to a significant level. It represents a minimum volume that would be associated with a hospice that would be large enough to be financially viable and

      still offer comprehensive services to the patients who request hospice care." (Tr. 782).

3. AHCA's Calculation and First Fixed Need Pool Publication

1. On July 12, 1999, LifePath submitted the first of two "Semi-annual Reports of Hospice Utilization" for calendar year 1999 to the Agency. The report showed a total of 1,406 new patients admitted by LifePath for the period January 1, 1999, through June 30, 1999. The first half of the year total was broken down for LifePath's two service areas; the number of admissions in Service Area 6A totaled 1,282, and the number of admissions in Service Area 6B totaled 124. The report is signed in a space for the administrator of LifePath to show that it had been reviewed and approved.

2. On January 7, 2000, LifePath filed its second utilization report for calendar year 1999. The second semi- annual report, covering the period from July 1, 1999, through December 31, 1999, showed a total of 1,368 patients admitted for the second half of 1999. Also broken down into admissions by service area, the report indicated that 1,228 of the admissions were in Service Area 6A and 140 of the admissions were in Service Area 6B for the second half of 1999. This report also shows review and approval by a LifePath Administrator, in this second case, by Kathy L. Fernandez, LifePath's CEO.

3. With the two utilization reports in hand, AHCA calculated numeric need for the two service areas served by LifePath pursuant to the Rule's formula. With regard to Service Area 6A, Hillsborough County, AHCA determined HPH to be 2,871. (The HPH figure for Hillsborough County is not in dispute in this proceeding.) Based on LifePath's utilization reports, AHCA determined HP for Service Area 6A, Hillsborough County, to be 2,510. Inserting these two figures into the appropriate places in the formula yielded a resulting difference of 360. Since the result was a positive difference of 350 or more, the result indicated a numeric need for one more hospice in Service Area 6A. Different Information

4. The Agency prepared to publish a hospice fixed need pool of "one" for Service Area 6A on January 28, 2000. While preparation was underway, LifePath's CEO Ms. Fernandez was informed of what the publication would show. Surprised, she asked her staff to investigate the utilization data LifePath had submitted to AHCA. The investigation conducted, the results were reported to Ms. Fernandez. In Ms. Fernandez' words, she realized:

   there was an error. When [staff] ran a simple computer report for the admissions that were admitted in 6A and 6B, they came back and told me the numbers that they had run on the computer were different than the numbers that we turned into AHCA.

   (Tr. 609) According to the new computer-run numbers, LifePath had admitted 32 more patients during Calendar Year 1999 in Service Area 6A than it had reported.

5. The difference in the new numbers and the ones reported to AHCA concerned hospice patients who had been admitted to LifePath while patients of hospitals located in Hillsborough County but whose permanent residences were outside Hillsborough County and, conversely, patients who had been reflected as 6A admissions but had been admitted while outside Hillsborough County.

6. The new numbers reflected where patients were located at the time of admission as opposed to where the patients permanently resided. Forty patients were involved. Thirty-six of them had been admitted to LifePath while physically present in Service Area 6A, that is, at the time of admission, they were patients in Hillsborough County hospitals. Another four patients had been reported to have been admitted in Service Area 6A, but had actually been admitted while physically present in Service Area 6B. In consideration of location at time of admission rather than permanent residence or home as the patient's place of admission, the new numbers, therefore, showed a net change of 32 patients that in LifePath's view should have been regarded as Service Area 6A admissions above the reported number of Service Area 6A admissions.

7. The utilization reports submitted to the Agency, unlike the new numbers, did not show admissions by location of the patient at the time of admission because the reports had determined admissions by which LifePath team had cared for the patients. The 36 patients admitted while in Hillsborough County hospitals but omitted from the utilization reports as 6A admissions had been cared for by LifePath's Rose Team, a team "geographically placed in 6B." (Tr. 610). They were counted in the reports, therefore, as 6B admissions without regard to the fact that the admissions had occurred at a moment when the patients were actually located in Service Area 6A as Hillsborough County hospital patients. The same was true of the four patients reported to have been 6A admissions. They were all physically located in Service Area 6B at the time of their admission. In each of these cases, the teams were assigned on the basis of the patient's home address at the time of admission rather than the patient's actual location at the time of admission.

8. In light of the new numbers that reflected a different approach and an understanding of the difference between those numbers and the ones LifePath had submitted by way of the reports, LifePath concluded that its utilization reports had underreported 6A admissions for calendar year 1999 by 32 patients. Armed with this new information and what it viewed as

   a sounder approach to the reporting of admissions, LifePath set out to correct what it hoped AHCA would see as an error.

9. On January 26, 2000, two days in advance of the scheduled publication of the fixed need pool for hospice programs in the State, LifePath caused to be hand-delivered to the Agency, a letter from its attorney. In pertinent part, the letter reads as follows:

   Enclosed . . . is correspondence and a packet of information . . . which notifies the Agency of mistakes . . . made in LifePath's last two [reports].

   
   

   This information included Patient Data Sheets from LifePath's information system for 36 patients who were admitted and cared for in Service Area 6A (Hillsborough County), but who were mistakenly counted as Service Area 6B patients. Also, enclosed are Data Sheets for 4 patients who were admitted and cared for in Service Area 6B (Polk County), but who were mistakenly counted as Service Area 6A patients . . . . The error occurred when patients were mistakenly counted by nursing team (e.g., the Rose and Yellow teams), rather than strictly by geographic location of where the patient received his/her care.

   The net result will be an addition of 32 patients to Service Area 6A and a reduction of 32 patients from Service Area 6B.

   
   

   It is respectfully requested that, based upon this new information, your office correct the upcoming fixed need pool projection for Hospice Service Area 6A, scheduled to be published on January 28, 2000 and, instead of publishing a need for one (1) new hospice program in Service Area 6A, publish a need

   for zero (0) new hospice programs in Service Area 6A for the upcoming CON batching cycle.

   
   

   (Hernando-Pasco Ex. No. 15).

   
   

10. The forty Patient Data Sheets attached to the letter bear the title "Patient Referral Data." Below the title is the time that the data was generated by the computer. All forty sheets were generated between 10 a.m. and 11 a.m., the morning of January 26, 2000.

11. As current location, 36 of the sheets list one of a number of hospitals in Hillsborough County. The majority of the sheets show the Moffitt Cancer Center as the patient's current location. Some data sheets of these 36 list other hospitals in Hillsborough County as the patient's current location: Tampa General Hospital, St. Joseph's Hospital, Brandon Regional Hospital, and South Florida Baptist Hospital.

12. The other four data sheets list as "current location" either Lakeland Regional Medical Center in Polk County or Winter Haven Hospital in Polk County.

13. The forty referral data sheets generated by LifePath's information system on January 26, 2000, were not produced in the customary format used by LifePath. They were reformatted to show the patient's location at the time of admission (termed "current location") and to omit the patient's permanent residence or home address. At hearing, LifePath's CEO candidly stated that the

    "Patient Referral Data" sheets were "altered . . . to show the [patient's] location at the time of admission." (Tr. 612). Some of the information remained the same on the sheets produced on January 26 as was customary. Just as Ms. Fernandez testified, for example, the 36 sheets that show a hospital in Hillsborough County as the current location list under "Team Code" the Rose Team, LifePath's team that serves Service Area 6B. The four that show Polk County as "current location" list the Yellow Team, the LifePath team that serves Hillsborough County or Service Area 6A, under "Team Code."

14. The January 26 data sheets' use of the word "current" to describe the patient's location is a misnomer if applied to the date the information was generated. The 36 patients with Hillsborough County locations had passed away by January 26, 2000. On the other hand, the use of the word "current" is accurate if understood to mean the location at the time of the referral and admission, a use consistent with the title of the document as reflecting "referral" data.

    Response by the Agency

    
    

15. The January 28, 2000, publication proceeded as planned without change. But, after receiving the information submitted by LifePath, AHCA published a second "Notice of Hospice Program Fixed Need Pool." This second publication appeared in Volume 26, Number 6 of the Florida Administrative Weekly on February 11,

    2000. It indicated a revised net need for zero (0) hospice programs for Service Area 6A.

16. As reflected by the revised publication, AHCA believed that the second publication correctly determined the net need for the service area to be zero. The determination is based upon the Agency's interpretation of Rule 59C-1.0355. As Mr. Gregg, Chief of the Bureau of Health Facility Regulation, for the Agency explained at hearing:

    [T]he rule . . . directs us to consider the place where the patient was prior to admission.

    
    

    * * *

    
    

    For people who have been . . . nursing home residents, or ALF residents, or in and out of hospitals prior to being admitted to a hospice, their actual residence may not be quite so clear. And so the interpretation is that it is the place from which they are referred.

    
    

    (Tr. 932, 933).

    
    

17. With regard to the 36 patients originally reported as Service Area 6B admissions but who had been admitted while in a hospital in 6A, LifePath continued to provide hospice services to the patients after they returned to a location in Service Area 6B. LifePath's ability to admit in one service area and provide treatment later in a different service area makes this case somewhat unusual. There are few hospices in Florida that provide service in more than one service area. For that reason, the

    issues presented in this case have not surfaced in the past. The more common situation for when a patient is admitted in a hospital in one service area and provided hospice services there and then returns to a permanent residence in another service area would call for the patient to be admitted to two different hospices at two different times. In such a case, for the sake of consistency, the Agency "would want to see . . . an admission to the program in [the service area in which the hospital was located]" (Tr. 934) and then a second admission to the hospice in the service area in which the patient had permanent residence when the patient moved back home or to a location in the second service area. This expectation of the Agency, however, is not required by rule. It is one that apparently has emerged in the context of this case.

    LifePath's Transmission of Data to Hernando-Pasco

    
    

18. On February 18, 2000, LifePath transmitted to

    
    

    Mr. Rodney Taylor, the Administrator of Hernando-Pasco Hospice, referral records for the same forty patients whose referral data sheets generated on the previous January 26 had been submitted to the Agency. In its cover letter to Mr. Taylor, Ms. Fernandez wrote on behalf of LifePath:

    I'm enclosing the referral records for the patients who were inadvertently mis- classified as to county of admission by LifePath in 1999. We found a few original referral records were not filed appropriately

    in the medical record, or in error, reflected the home address versus the hospital in which they were admitted. In those instances, I am attaching a portion of the Admission Assessment or Patient Information Sheet to which show the actual point of admission. As you know, if I run a current referral record, HPMS will show the patient's current address rather than the point of admission.

    
    

    (Hernando-Pasco Ex. 16). Unlike the Patient Referral Data generated January 26, the Patient Referral Data sheets sent to Mr. Taylor show that they were generated earlier, on various dates in 1999. Also dissimilar from the sheets produced on January 26 that had omitted "home address" and had shown only the location at the time of admission, moreover, the sheets provided Mr. Taylor show not only a "current location" or a location at the time of admission but also the patient's home address.

19. No attempt was made by LifePath to hide the fact that the Patient Referral Data Sheets submitted to AHCA on January 26, 2000, had been generated on that same date rather than any earlier date as in the case of the information transmitted later to Mr. Taylor and Hernando-Pasco Hospice. The other main difference between the two sets of data submitted to the Agency and to Mr. Taylor, that is, the omission from the data submitted to AHCA of the patient's home address, was explained by

    Ms. Fernandez as an act done for the State's benefit, "so as not to confuse them." (Tr. 622.)

    Other Provisions of the Rule

    
    

20. Rule 59C-1.0355 is an extensive rule. The Rule consists of ten subsections that cover an array of topics related to hospice programs. In addition to the provisions setting forth criteria for determination of numeric need, the rule contains a "definition" section, general provisions related to quality of care and conformance with statutory criteria, consistency with plans, required description of the program, construction and changes in licensed capacities of freestanding hospice facilities, and grandfathering provisions. Also included in the Rule is a statement of intent and pertinent to this proceeding, Subsection (9), which governs semi-annual utilization reports.

21. Subsection (9) of the Rule states:

    
    

    Each hospice program shall report utilization information to the agency or its designee on or before July 20 of each year and January 20 of the following year. The July report shall indicate the number of new patients admitted during the 6-month period composed of the first and second quarters of the current year, the census on the first day of each month included in the report, and the number of patient days of care provided during the reported period. The January report shall indicate the number of new patients admitted during the 6-month period composed of the third and fourth quarters of the prior year, the census on the first day of each month included in the report, and the number of patient days of care provided during the reporting period. The following detail shall also be provided:

    1. For the number of new patients admitted:

       
       

       1. The 6-month total of admissions under age

          65 and age 65 and over by type of diagnosis (e.g., cancer; AIDS).

          
          

       2. The number of admissions during each of the 6 months covered by the report, by service area of residence.

       
       

    2. For the patient census on April 1 or October 1, as applicable, the number of patients receiving hospice care in:

       
       

       1. A private home.

       2. An adult congregate living facility.

       3. A hospice residential unit.

       4. A nursing home.

       5. A hospital.

       
       

       (Hernando-Pasco Ex. 9, emphasis supplied).

       
       

22. There is no definition of "service area of residence." The term "service area resident" is used extensively in the descriptions of the factors that make up HPH, "the projected number of patients electing a hospice program in the service area during the 12 month period beginning at the planning horizon." See Subsection (4)(a) of the Rule.

23. HPH, however, is not in dispute in this proceeding. It is the other term in the formula that is in dispute: "HP." The Rule's definition of "HP" does not use the term "service area of residence." But the definition cross-references to Subsection

    1. reporting requirements: "(HP) is the number of patients admitted to hospice programs serving an area during the most recent 12-month period ending on June 30 or December 31. The

       number is derived from reports submitted under subsection (9) of the rule." Section (4)(a) of the Rule.

24. The Agency interprets "service area of residence" not to mean the service area where the patient has a "permanent residence," but the service area which is the patient's "location at the time of admission."

25. There are good reasons in support of the AHCA's interpretation. Hospitalized hospice patients come from a population that has been mobile. Some have permanent residences in foreign countries, other states (so-called "snowbirds") or in other counties in the state or different health planning service areas than the one in which they are hospitalized. Some hospice patients may have no permanent residence at all, as in the case of the homeless. To report as admissions only those who reside permanently in a service area in Florida by that service area and to not report the patient as an admission when admitted in the service area in which the patient is hospitalized or located at the time of admission would omit many admissions. As Mr. Gregg testified on behalf of the Agency, the numeric need formula produces the "most accurate projection of need by having the best data and the most complete data; therefore you would want every possible admission to be reported." (Tr. 958).

    An Additional Contention

    
    

26. In addition to contending that the numbers originally reported by LifePath were correct for calculation of HP and that the later reported numbers may not be used for calculation of HP, Hernando-Pasco raises a second, fundamental issue. Hernando- Pasco contends that the 36 patients did not achieve the status of admission while in the hospital. According to Hernando-Pasco's line of thinking, if the patients were ever admitted to LifePath, it was not until after their return to Service Area 6B. To address these contentions, it is necessary to examine the admissions process used by LifePath, whether that process was applied to the 36 patients, and, ultimately, whether that process meets the legal requirements for hospice admission.

    LifePath's Admissions Process for the Hospitalized Patient

    
    

27. Whether hospitalized or not, admission of a patient to LifePath commences with a physician order or a request from the patient or family of the patient. A pre-admission visit is conducted to determine if the patient is eligible for hospice services. During the visit, a representative of LifePath speaks with the patient and family to ensure that services have been requested.

28. In the case of a hospitalized patient, death is often imminent and occurs in the hospital. LifePath, therefore, does not wait for the patient to return home or to a residential

    setting to commence admission. The formal admission process is initiated at the hospital by the admissions nurse, a professional who has received training on how to conduct initial psychosocial, spiritual and financial assessments to be undertaken during the admissions process together with the physical assessment.

29. The admitting nurse goes to the location of the patient where the admissions process takes between two and one-half and three hours. Because of the length of time required, LifePath's "admission nurses do [only] two admissions a day." (Tr. 641).

30. If the patient's location is a hospital, the nurse does a physical assessment and an initial psychosocial, financial, and spiritual assessment of the patient. Forms for consent of care, medical exchange of information, and authorization of payment forms as well as a patient information sheet are completed. Advance directives are discussed. Prognostic indicators, criteria set by the state, are reviewed to determine whether the patient meets admission criteria. Emergency planning is discussed. A teaching record is prepared. A physician's referral and plan of treatment are completed and confirmed with the physician. An interdisciplinary plan of care is initiated. Referrals of patients, if necessary, are facilitated.

31. For the hospitalized patient for whom end of life is not imminent and who will have the opportunity to return home, LifePath's objective is to facilitate that return. Planning for

    the discharge of a patient from a hospital is an important hospice service. Often it involves the ordering of medications and equipment in anticipation of the patient's return home, two functions that require admission to the hospice. In such cases, physician's orders are necessary and a physician will not give a hospice orders to care for a patient unless the patient is admitted to the hospice program.

32. For the hospitalized patient for whom death is imminent, one of the important reasons for admission to hospice is to qualify the patient's family for the 13 months of bereavement services hospices are required to provide survivors under the Medicare hospice benefit. Hospices also admit patients near death so that they may be provided care as quickly as possible.

33. A hospitalized patient is considered by LifePath to be admitted when the physical assessment and at least the initial psychosocial, spiritual, and financial assessments are conducted by the admitting nurse, all consent forms are complete and the hospice takes over the care of the patient in coordination with the hospital.

34. LifePath's Administrative/Operational Manual with regard to the subject of "Admission Process" (see Hernando-Pasco Exhibit 25) requires more in the way of procedure for an admission than is done for the typical hospitalized patient. The

    manual describes procedure for the admissions process as consisting of 35 categories of items (Procedures A - Z, and AA through II), some of which have numerous sub-parts. The process leads to a Plan of Care. The procedure includes:

    W. In conjunction with one additional IDT member develop the "Plan of Care". Identify foci and document on the IDT Plan of Care. Complete a "Hospice Interdisciplinary Plan of Care Evaluation/Summary" form.

    
    

    (Id., emphasis supplied.)

    
    

35. Normally, it is the social worker member of LifePath's interdisciplinary care team, together with the admissions nurse, who develops the plan of care. According to the "Position Description" of LifePath's "Hospital Team Patient/Family Counselor", it is the social worker also who "[w]orks closely with the LH Hospital Team RN to assure timely admissions." (Hernando-Pasco Exhibit 26, Li-He 974).

36. In the case of a hospitalized patient for whom admission is requested, however, the social worker may not participate in LifePath's admission process at all. To complete a full psychosocial assessment and history takes up to three hours. To do so on the day of admission following the two and one-half hour to three-hour admissions process conducted by the nurse frequently "would be cumbersome and overburdening to a patient and family." (Tr. 644). This is especially true in the case of the patient for whom death is imminent.

37. In the case of the patient who will have the chance to return home, the full follow-up psychosocial and spiritual assessments conducted by social workers and chaplains are often deferred by patient and family request. Understandably, conducting the full assessment can be too much for the hospitalized patient who has just received a prognosis of terminal illness and the patient's family in the midst of arrangements for transfer of the patient home and initiation of the care to be delivered. The family frequently chooses to defer "to a time when they can sit down and comfortably speak about what they need to, at a different time, when things are calmer." (Tr. 647).

38. There may be other complications with a hospitalized patient, as opposed to a patient admitted at home or in another setting. Sometimes hospitals do not permit patients to elect the Medicare hospice benefit while they are inpatients. Nonetheless, they can still be admitted to the hospice and be provided hospice services. If the hospital allows the patient to elect hospital benefits, LifePath is eligible for reimbursement for services provided on the day of a patient's admission.

39. Once LifePath admits a hospitalized patient, the LifePath hospital team is notified. The team consists of hospice nurses, social workers, and a chaplain. The team continues to

    see the patient while in the hospital and helps coordinate the care and, frequently, the discharge of the patient.

    The 36 Patients Hospitalized in 6A

    
    

40. The 36 patients originally reported by LifePath as admissions in Service Area 6B were all eligible for admission to hospice at the time LifePath undertook to admit them to hospice care. All 36 were admitted while physically located in Service Area 6A. The admission process for the 36 patients included a professional initial assessment by the admitting nurse of the social, psychological, spiritual and financial needs of the patient as well as a physical assessment.

41. LifePath was not reimbursed by Medicare for 34 of the patients in question for hospice care in the hospital. Nor did LifePath seek compensation from Medicare for the care in the hospital provided these patients. As to those patients who returned home or were transferred to another residential setting in Service Area 6B, LifePath received Medicare reimbursement for the hospice care provided in the residential setting. LifePath explained that it did not receive Medicare reimbursement for the care provided during the time the 34 spent in the hospital because the hospitals would not allow the patients to elect hospice Medicare benefits while in the hospital. Hospitalized patients, moreover, LifePath explained, can be admitted as

    patients who pay privately without the involvement of a third

    
    

    party payer.

    
    

    CONCLUSIONS OF LAW

    
    

    Jurisdiction

    
    

42. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of these proceedings. Sections 120.569 and 120.57(1), Florida Statutes.

    Hospices in General, Chapter 400, Part IV, Florida Statutes

    
    

43. The Legislature has made two basic findings with regard to both terminally ill individuals who are no longer pursuing curative medical treatment and their families. First, they "should have the opportunity to select a support system that permits the patient to exercise maximum independence and dignity during the final days of life." Section 400.6005, Florida Statutes. Second, "hospice care provides a cost-effective and less intrusive form of medical care while meeting the social, psychological, and spiritual needs" of the patients and their families. Id.

44. Services provided by hospice programs are governed by Section 400.609, Florida Statutes. The services to be provided constitute a continuum "tailored to specific needs and preferences of the patient and family at any point in time throughout the length of care for the terminally ill patient and during the bereavement period." Section 400.609, Florida

    Statutes. Physician services may be provided directly by the hospice or through contract but the treatment by the physician must be palliative in nature (as are hospice services in general) as opposed to curative medical treatment. Pain management would be an example of palliative services that a physician might offer a hospice patient. Core hospice services, provided by the hospice team, are: "nursing services, social work services, pastoral or counseling services, dietary counseling, and bereavement counseling services." Section 400.609(1)(a), Florida Statutes.

45. Other services, such as physical therapy, home health aide services, provision of medical supplies and durable medical equipment, and funeral services must be provided or arranged for by hospices as needed to meet the palliative and support needs of the patient and family.

46. "Hospice care and services provided in a private home shall be the primary form of care." Section 400.609(2), Florida Statutes (emphasis supplied). In keeping with this statutory declaration, "[t]he goal of hospice home care shall be to provide adequate training and support to encourage self-sufficiency and allow patients and families to maintain the patient comfortably at home for as long as possible." "Home" may be a place of temporary or permanent residence. See Section 400.601(6), Florida Statute, the definition of "Hospice Services." But

    hospice services in a hospice inpatient facility or with contracted institutions (such as a hospital) also qualify as hospice services for purposes of the statute. Id.

47. It is recognized throughout Chapter 400, Part VI, devoted to hospices, moreover, that hospice services may be provided outside the home even though in-home care is the primary form of hospice care. Section 400.609, Hospice services, for example, recognizes three places for hospice services to be rendered: 1) at the patient's home; 2) in a residential setting other than the home; and 3) in an inpatient facility (such as a hospital):

    400.609 Hospice services. -- Each hospice shall provide a continuum of hospice services which afford the patient and the family of the patient a range of service delivery which can be tailored to specific needs and preferences of the patient and family at any point in time throughout the length of care for the terminally ill patient and during the bereavement period. These services must be available 24 hours a day, 7 days a week, and must include:

    
    

    * * *

    
    

    1. HOSPICE HOME CARE.-–Hospice care and services provided in a private home shall be the primary form of care. The goal of hospice home care shall be to provide adequate training and support to encourage self-sufficiency and allow patients and families to maintain the patient comfortably at home for as long as possible. The services of the hospice home care program shall be of the highest quality and shall be provided by the hospice care team.

       
       

    2. HOSPICE RESIDENTIAL CARE.-–Hospice care and services, to the extent practicable and compatible with the needs and preferences of the patient, may be provided by the hospice care team to a patient living in an assisted living facility, adult family care home, nursing home, hospice residential unit or facility, or other nondomestic place of permanent or temporary residence. A resident or patient living in an assisted living facility, adult family care home, nursing home, or other facility subject to state licensing who has been admitted to a hospice program shall be considered a hospice patient, and the hospice program shall be responsible for coordinating and ensuring the delivery of hospice care and services to such person pursuant to the standards and requirements of this part and rules adopted under this part.

       
       

    3. HOSPICE INPATIENT CARE.-–The inpatient component of care is a short-term adjunct to hospice home care and hospice residential care and shall be used only for pain control, symptom management, or respite care. The total number of inpatient days for all hospice patients in any 12-month period may not exceed 20 percent of the total number of hospice days for all the hospice patients of the licensed hospice. Hospice inpatient care shall be under the direct administration of the hospice, whether the inpatient facility is a freestanding hospice facility or part of a facility licensed pursuant to chapter 395 or part II of this chapter. The facility or rooms within a facility used for the hospice inpatient component of care shall be arranged, administered, and managed in such a manner as to provide privacy, dignity, comfort, warmth, and safety for the terminally ill patient and the family. Every possible accommodation must be made to create as homelike an atmosphere as practicable. To facilitate overnight family visitation within the facility, rooms must be limited to no

    more than double occupancy; and, whenever possible, both occupants must be hospice patients. There must be a continuum of care and a continuity of caregivers between the hospice home program and the inpatient aspect of care to the extent practicable and compatible with the preferences of the patient and his or her family. Fees charged for hospice inpatient care, whether provided directly by the hospice or through contract, must be made available upon request to the Agency for Health Care Administration. The hours for daily operation and the location of the place where the services are provided must be determined, to the extent practicable, by the accessibility of such services to the patients and families served by the hospice.

    
    

48. If a patient may be provided hospice services while hospitalized and hospices are required to be capable of providing hospice inpatient care (care to the hospitalized patient) it follows that a patient may be admitted to hospice while in the hospital. It is not a rare event for a hospitalized patient or the patient's family to request hospice services for the first time while the patient is in the hospital, whether the patient is likely to return home or, in the case of imminent death, to die in the hospital. It is clear from reading of Chapter 400, Part VI, that a patient may be admitted legally to hospice while in the hospital no matter where the patient resides or the location of the patient's permanent residence.

    The Admissions Process According to Statute

    
    

49. Patient admission is governed by Section 400.6095, Florida Statutes. As the catchline to the statute recognizes, the section deals with more than just admissions. It contains provisions related to "assessment; plan of care; discharge; death."

50. The opening provisions of the statute prohibit discrimination and require respect for the hospice patient's belief system. Subsections (5) through (9) of the statute deal with plans of care, ongoing assessments, withholding of resuscitation and death of hospice patients.

51. Three of the statutes subsections govern admissions, subsections (2), (3) and (4):

    1. Admission to a hospice program shall be made upon a diagnosis and prognosis of terminal illness by a physician licensed pursuant to chapter 458 or chapter 459 and shall be dependent upon the express request and informed consent of the patient.

       
       

    2. At the time of admission, the hospice shall inquire whether advance directives have been executed pursuant to chapter 765, and if not, provide information to the patient concerning the provisions of that chapter. The hospice shall also provide the patient with information concerning patient rights and responsibilities pursuant to s. 381.026.

       
       

    3. The admission process shall include a professional assessment of the physical, social, psychological, spiritual, and financial needs of the patient. This

    assessment shall serve as the basis for the development of a plan of care.

    
    

    Section 400.6095, Florida Statutes.

    
    

52. The statute goes on to require a plan of care for the patient and to describe in detail what, at a minimum, the plan of care must contain. At no point in the statute is there any reference to the existence of a plan of care or initiation of care for the patient as a prerequisite to the patient having achieved the status of "admission" to the hospice.

53. From the statute, it appears that the admission process is considered complete once the appropriate assessments have been conducted in the form of a professional assessment. There is no set requirement that each of the assessments must be conducted by a professional within the specific five areas decreed by the statute: physical, social, psychological, spiritual and financial. In other words, the statute does not specifically require that a social worker conduct the "social" assessment just as it does not require that an accountant conduct the "financial" assessment. It simply requires that the (singular) assessment in the five required areas be "professional." This statement is open to LifePath's interpretation that the assessment in the five areas may be conducted by a single professional, such as an admissions nurse. Accepting this interpretation, LifePath met this requirement with regard to the 36 patients when it conducted

    assessments in the required areas, even though some of the assessments were incomplete. The 36 patients were admitted in Service Area 6A while in Hillsborough County hospitals.

    Compliance with the Reporting Requirement

    
    

54. The rule requires that new patients admitted in each six-month period be reported in several ways. First, they must be reported in categories of over and under 65 and then by type of diagnosis. Second, they must be reported "by service area of residence." The term "service area of residence" is not defined.

55. Hernando-Pasco does not contend that LifePath did not comply with the reporting requirements initially. LifePath provided second reports that were different. The changes showed a location of each patient at the time of admission in a hospital in 6A rather than the patient's permanent residence.

56. Hernando-Pasco claims that the changes were of bad faith, even misrepresentation. There is no question that LifePath deliberately changed its way of reporting in the second report at issue. The changes produced a numeric need of "zero" rather than "one," a revision in LifePath's favor and one sought by LifePath. A change in a reporting method that favors a party, alone, does not amount to bad faith. And there is no evidence of misrepresentation. The approach of the second report did no more than to beg the question: in what service area should a patient

    be counted as admitted if the patient has a permanent residence in 6B but is admitted while hospitalized in 6A?

57. The Agency has accepted the changes in the second report with full knowledge of the circumstances. In so doing, AHCA relies on an interpretation of "service area of residence" to mean the service area in which the patient is located at the time of admission rather than the service area in which the patient permanently resides.

58. An agency's interpretation of its own rules is entitled to great weight and will not be disregarded unless clearly erroneous, Orange Park Kennel Club, Inc. vs. State, Department of Business Regulation, 644 So. 2d 574 (Fla. 1st DCA), even if not the sole interpretation, the most logical, or even the most desirable. State, Board of Optometry vs. Florida Society of Ophthalmology, 538 So. 2d 878, 885 (Fla. 1st DCA 1988).

59. AHCA, the agency whose rule it is, supports counting the patient as admitted in 6A for purposes of calculating numeric need. AHCA's interpretation results in the most accurate projection of need because every possible admission is reported. Hernando-Pasco's interpretation would result in an exclusion of admissions of non-Florida residents and those patients (such as the homeless) for whom no permanent residence can be established. The Agency's approach is consistent with the definition of HP, that is, "the number of patients admitted to hospice programs

    serving a service area during the most recent [year]." Section (4)(a) of the Rule. If the definition of HP does not square with the Rule's reporting requirements, that is a matter of internal rule consistency AHCA should address. As a matter of attempting to construe the terms of its rule to achieve consistency in a manner that most effectuates the purposes of the rule, AHCA's interpretation is not clearly erroneous.

    Best Policies vs. Existing Law

    
    

60. Hernando-Pasco advances numerous reasons for why the 36 patients should not count as Service Area 6A admissions. For example, Hernando-Pasco proved that LifePath did not comply with its own policy contained in its admissions manual. LifePath offered an explanation for why hospitalized patients are an exception (not expressed in the manual) to its general admissions policy. Hernando-Pasco argues in favor of LifePath's written policy. Hernando-Pasco argues that an admission has not occurred until a plan of care has been developed and care has been initiated.

61. No such requirement exists in law. From a reading of the admissions statute, Section 400.609, it appears that admissions assessments lead to adoption of a plan of care and the initiation of hospice care, but there is no requirement that adoption of the plan of care and the initiation of care take place prior to a patient's achievement of the status of

    "admitted." Perhaps it would be better admissions practice for LifePath's admissions policy to apply to hospital patients before they count as admissions but there is no statute or agency rule in existence now that defines admission as requiring all the steps in LifePath's written admissions policy.

62. Another argument advanced by Hernando-Pasco is that since LifePath did not seek Medicare reimbursement for 34 of the

    36 patients in question for the hospice care provided while the patients were hospitalized, the patients could not have been admitted to hospice while in the hospital. Hernando-Pasco argues that LifePath's position that these patients were not allowed access to Medicare benefits by the hospitals and were private paying patients to be "faulty, not supportable and quite possibly illegal." Petitioner's Proposed Recommended Order, p. 27. Whatever the merit of this argument, it does not defeat the conclusion that the facts support that the 36 patients were admitted while hospitalized in Service Area 6A as admission is presently defined in law.

63. Perhaps Hernando-Pasco's numerous arguments for what should constitute admission and its definition of "service area of residence" should be incorporated into an agency rule but that is a decision for the Agency on another day. This is not a rule- making proceeding. It is a proceeding challenging the validity of agency action: revision of a fixed need pool.

    AHCA's Revision Should Stand

    
    

64. In sum, LifePath admitted 36 patients hospitalized in Service Area 6A that it originally reported as having been admitted in Service Area 6B, the service area that was the locus of their permanent residence. When the Agency received new reports reflecting admissions in Service Area 6A, it recalculated numeric need from "one" to "zero." The evidence demonstrates that the 36 patients achieved the status of admission in Service Area 6A as "admission" is delimited by statute. With full knowledge of the circumstances, AHCA maintains that the patients should count as Service Area 6A admissions and reported as such. In doing so, the Agency has engaged in interpretations of its own rules that are neither unreasonable nor clearly erroneous. Whatever merit Hernando-Pasco's many arguments have with regard to what agency policy should be on the subject of admissions and reporting of admissions by hospices, there is nothing in law that compels a result different from the one last reached by AHCA and maintained throughout this proceeding. Hernando-Pasco has failed to carry its burden of proof to overturn AHCA's revision of the fixed need pool. The Agency's revision of the fixed need pool to "zero" as published in February, 2000 should stand.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is

RECOMMENDED that a final order be entered by the Agency for Health Care Administration determining the fixed need pool for health planning subdistrict 6A for the March 2000 batching cycle to be zero.

DONE AND ENTERED this 18th day of May, 2001, in Tallahassee, Leon County, Florida.

DAVID M. MALONEY

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847 www.doah.state.fl.us

Filed with the Clerk of the Division of Administrative Hearings this 18th day of May, 2001.

COPIES FURNISHED:

Sam Power, Agency Clerk

Agency for Health Care Administration 2727 Mahan Drive

Fort Knox Building Three, Suite 3431 Tallahassee, Florida 32308-5403

Julie Gallagher, General Counsel Agency for Health Care Administration 2727 Mahan Drive

Fort Knox Building Three, Suite 3431 Tallahassee, Florida 32308-5403

Richard A. Patterson, Esquire

Agency for Health Care Administration 2727 Mahan Drive

Fort Knox Building Three, Suite 3431 Tallahassee, Florida 32308-5403

Gerald B. Sternstein, Esquire Frank P. Rainer, Esquire Sternstein, Rainer & Clarke, P.A.

101 North Gadsden Street Tallahassee, Florida 32301

H. Darrell White, Esquire

McFarlain, Wiley, Cassedy & Jones, P.A.

215 South Monroe Street, Suite 600 Post Office Box 2174

Tallahassee, Florida 32316-2174

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within 15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the Final Order in this case.

Docket for Case No: 00-001067CON

Orders for Case No: 00-001067CON