STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its designated Administrative Law Judge, J.D. Parrish, held a final hearing in the above-styled case on November 3-7, 12-14, 17-21, and 25, 2008, in Tallahassee, Florida.

APPEARANCES

For HCA Health Services of Florida, Inc., and Lawnwood Medical Center, Inc.:

Stephen A. Ecenia, Esquire

J. Stephen Menton, Esquire David Prescott, Esquire

Rutledge, Ecenia & Purnell, P.A.

215 South Monroe Street, Suite 420 Post Office Box 551

Tallahassee, Florida 32302

For Agency for Health Care Administration:

Karin M. Byrne, Esquire

Agency for Health Care Administration 2727 Mahan Drive

Building 3, Mail Station 3

Tallahassee, Florida 32308

For Martin Memorial Medical Center, Inc.: Paul H. Amundsen, Esquire

Julie Smith, Esquire Amundsen & Smith

502 East Park Avenue Tallahassee, Florida 32301

and

Robert A. Weiss, Esquire Karen A. Putnal, Esquire

Parker, Hudson, Rainer & Dobbs, LLP The Perkins House, Suite 200

118 North Gadsden Street Tallahassee, Florida 32301

STATEMENT OF THE ISSUE

Whether an application for a new hospital to be constructed in Agency for Health Care Administration Planning District 9, Subdistrict 2, should be approved.

PRELIMINARY STATEMENT

Petitioners, HCA Health Services of Florida, Inc., d/b/a St. Lucie Medical Center and Lawnwood Medical Center, Inc., d/b/a Lawnwood Regional Medical Center (St. Lucie, Lawnwood or Petitioners), have challenged the preliminary approval of Certificate of Need (CON) Application No. 9981 (the application). The application at issue was filed by the

Respondent, Martin Memorial Medical Center, Inc. (Martin or Respondent) in the first batching cycle in 2007. Martin seeks to construct a new acute care hospital in the western portion of St. Lucie County (AHCA Planning District 9, Subdistrict 2). Its CON application to do so was reviewed and preliminarily approved by the Respondent, Agency for Health Care Administration (AHCA or Agency). AHCA issued its State Agency Action Report (SAAR) granting preliminary approval for the new hospital on June 13, 2007. The SAAR outlined AHCA's reasons and explanations for the approval.

Section 408.039, Florida Statutes (2007), details the review process by which this case is governed. The Florida Legislature has directed AHCA to, by rule, provide for CON applications to be submitted on a timetable or cycle basis. Applications should be reviewed timely and applications pertaining to similar types of services or facilities are to be comparatively considered in relation to each other. In this case, however, Martin Memorial is the sole competitor for the facility sought. The approval of the CON application is opposed by the Petitioners who are existing providers within the same AHCA planning district. They timely filed petitions to oppose the new hospital proposed by Martin.

The case was forwarded to the Division of Administrative Hearings (DOAH) to conduct formal proceedings in connection with

the dispute. In accordance with the dates proposed by counsel for the parties, the case was scheduled for hearing as stated above.

All parties acknowledge that the applicable statutory criteria applicable to this proceeding are found in Sections 408.031-408.045, Florida Statutes (2007). More specifically, Section 408.035, Florida Statutes (2007) sets forth the CON review criteria at issue in this proceeding.

With regard to those review criteria, the parties have agreed:

1. Section 408.035(1), Florida Statutes (2007): The need for the health care facilities and health services being proposed. This review criterion is applicable and is disputed.

   
   

2. Section 408.035(2), Florida Statutes (2007): The availability, quality of care, accessibility, and extent of utilization of existing health care facilities and health services in the service district of the applicant. This criterion is applicable. The availability, accessibility, and extent of utilization of existing health care facilities and health services are in dispute. The quality of care of the existing providers is not in dispute, however, the stipulation did not preclude any party from presenting testimony and evidence relating to access, including, but not limited to, barriers to access, capacity constraints, and delays in admissions.

   
   

3. Section 408.035(3), Florida Statutes (2007): The ability of the applicant to provide quality of care and the applicant's record of providing quality of care. This

   criterion is applicable but is not in dispute.

   
   

4. Section 408.035(4), Florida Statutes (2007): The availability of resources, including health personnel, management personnel, and funds for capital and operating expenditures, for project accomplishment and operation. This criterion is applicable. In connection with this criterion, the parties agree that the number of clinical and nursing FTEs identified by the application are reasonable for the project and not disputed. The reasonableness of the projected salaries for the nurses shown on Schedule 6A of the application remain in dispute.

   
   

5. Section 408.035(5), Florida Statutes (2007): The extent to which the proposed services will enhance access to health care for residents of the service district. This criterion is applicable and is in dispute.

   
   

6. Section 408.035(6), Florida Statutes (2007): The immediate and long-term financial feasibility of the proposal. This criterion is applicable and is in dispute.

   
   

7. Section 408.035(7), Florida Statutes (2007): The extent to which the proposal will foster competition that promotes quality and cost-effectiveness. This criterion is applicable and is in dispute.

   
   

8. Section 408.035(8), Florida Statutes (2007): The costs and methods of the proposed construction, including the costs and methods of energy provision and the availability of alternative, less costly, or more effective methods of construction.

   This criterion is applicable. The parties agree that the projected costs in the application shown at Schedule 1, lines 1-3, and 12-26 are reasonable and are not in dispute. The remaining project costs are disputed. Additionally, the Petitioners

   claim that Martin's remote emergency department approved for construction is an available, alternative, less costly, and more effective method of construction than the construction of the proposed hospital. Martin maintains that the CON criteria no longer provide for comparison of the proposed project with the outpatient alternatives.

   
   

9. Section 408.035(9), Florida Statutes (2007): The applicant's past and proposed provision of health care services to Medicaid patients and the medically indigent. The parties agree this criterion is applicable but is not disputed. Nevertheless, they agreed any party could provide testimony comparing the parties' relative levels of service provided.

   
   

10. Section 408.035(10), Florida Statutes (2007): The applicant's designation as a Gold Seal Program nursing facility pursuant to Section 400.235, Florida Statutes, when the applicant is requesting additional nursing home beds in that facility. This criterion is not applicable to this case.

    
    

    With regard to the rules applicable to this case, the parties stipulated that the Agency rules applicable to this proceeding are set forth in Florida Administrative Code Rules 59C-1.008(2)(e), 59C-1.008, and 59C-1.030(2).

    With regard to Florida Administrative Code Rule 59C- 1.008(2)(e), the parties agreed that the following portion of the rule is pertinent and applicable to this matter:

    If an agency need methodology does not exist for the proposed project:

    1. The agency will provide to the applicant, if one exists, any policy upon which to determine need for the proposed

       beds or service. The applicant is not precluded from using other methodologies to compare and contrast with the agency policy.

       
       

    2. If no agency policy exists, the applicant will be responsible for demonstrating need through a needs assessment methodology which must include, at a minimum, consideration of the following topics, except where they are inconsistent with the applicable statutory or rule criteria:

       
       

       1. Population demographics and dynamics;

          
          

       2. Availability, utilization and quality of like services in the district, subdistrict or both;

          
          

       3. Medical treatment trends; and

          
          

       4. Market conditions.

       
       

    3. The existence of unmet need will not be based solely on the absence of a health service, health care facility, or beds in the district, subdistrict, region or proposed service area.

With regard to Florida Administrative Code Rule 59C-1.030(2), the parties agreed that the following portion of the rule is pertinent and applicable to this matter:

1. The need that the population served or to be served has for the health or hospice services proposed to be offered or changed, and the extent to which all residents of the district, and in particular low income persons, racial and ethnic minorities, women, handicapped persons, other underserved groups and the elderly, are likely to have access to those services.

   
   

2. The extent to which that need will be met adequately under a proposed reduction,

   elimination or relocation of a service, under a proposed substantial change in admissions policies or practices, or by alternative arrangements, and the effect of the proposed change on the ability of members of medically underserved groups which have traditionally experienced difficulties in obtaining equal access to health services to obtain needed health care.

   
   

3. The contribution of the proposed service in meeting the health needs of members of such medically underserved groups, particularly those needs identified in the applicable local health plan and State health plan as deserving of priority.

   
   

4. In determining the extent to which a proposed service will be accessible, the following will be considered:

1. The extent to which medically underserved individuals currently use the applicant's services, as a proportion of the medically underserved population in the applicant's proposed service area(s), the extent to which medically underserved individuals are expected to use the proposed services, if approved;

   
   

2. The performance of the applicant in meeting any applicable Federal regulations requiring uncompensated care, community service, or access by minorities and handicapped persons to programs receiving Federal financial assistance, including the existence of any civil rights access complaints against the applicant;

   
   

3. The extent to which Medicare, Medicaid and medically indigent patients are served by the applicant; and

   
   

4. The extent to which the applicant offers a range of means by which a person will have access to its services.

The parties have also stipulated that a timely and complete letter of intent, CON application, and omissions response were filed by Martin and processed by the Agency leading to a timely preliminary recommendation of the Agency in compliance with technical requirements, including those set forth in Section 408.037, Florida Statutes; Section 408.039(2)(a), (c), and (d), Florida Statutes; Section 408.039(3)(a), Florida Statutes; and Section 408.039(4)(b) and (c), Florida Statutes; that the architectural schematics, project completion schedule, design narratives, and code compliance information set forth in Martin's CON application are reasonable; and that the petitions filed in this cause were timely.

At the final hearing, Martin presented the testimony of the following witnesses: Mark Robitaille, President and CEO of Martin Memorial Health Systems, Inc., an expert in healthcare administration; Patricia Tobin, Director of Planning for Core Communities; Deborah Kolb-Collier, Ph.D., Senior Principal of the Noblis Center for Health Innovation, an expert in Health Care Planning and Finance; Peter M. Dayton, M.D., an expert in obstetrics and gynecology; Joseph S. Gage, M.D., an expert in internal medicine and cardiology; David Lee Hankin, J.D., CEO of the Alfred E. Mann Foundation for Scientific Research, Angie Metcalf, Corporate Director of Human Resources for Martin, an expert in human resource management and compensation; Richard

Houghton, Ph.D., President of the Torrey Pines Institute for Molecular Studies; Donald A. Carlson, Jr., Vice Chairman of the

B. C. Ziegler Company, an expert in health care investment banking and finance; Armand E. Balsano, Principal with Ethos Partners, an expert in health care finance and financial feasibility; Robert J. Barry, D.O., an expert in internal medicine; Nicholas Ianotti, M.D., an expert in medical oncology; and Robert C. Pergolizzi, AICP, PTP, an expert in traffic and travel time studies. Martin also presented the deposition testimony of Ron Parrish, fire chief for the St. Lucie County Fire District; Howard Robbins, M.D., the Chief Medical Officer Vice-President for Martin Memorial Health Systems who is also responsible for running Martin's medical group practice; Stanley

1. Smith, Ph.D., a professor at the University of Florida, who serves as the Director of the Bureau of Economic and Business Research responsible for producing population estimates for the State of Florida; Jay Nelson, Ph.D., the director of the Vaccine and Gene Therapy Institute at the Oregon Health and Sciences University; Judy Smith, a resident of St. Lucie West and a former patient of St. Lucie Medical Center; Stephen Pietrowski, the chief administrator of Port St. Lucie Hospital, a 75-bed acute psychiatric facility; Larry Pelton, President of the Economic Development Council of St. Lucie County; Michael J. Lannon, Superintendent of Schools for the St. Lucie County

   School Board; Wesley McCurry, a developer who serves as Vice President with Core Communities (Core) and as President of the wholly owned subsidiary of Core, Tradition Development Company, and a certified planner certified by the American Institute of Certified Planners, American Planning Association; Jerry Bentrott, an assistant city manager responsible for planning, engineering, public works, parks and recreation, community services, the building department, and capital projects for the City of Port St. Lucie; Michelle Lee Berger, City Councilwoman for District II, City of Port St. Lucie; Christopher Cooper, City Councilman for District III, City of Port St. Lucie; Edward

2. Hengtgen, Jr., an architect who is a member of the American Institute of Architects; Paul Matthew Baker, an expert in building construction technology and acute care hospital preconstruction costs employed as a preconstruction director for Balfour Beatty Construction; John A. Kolosky, Executive Vice President and CEO for the H. Lee Moffitt Cancer Center and Research Institute in Tampa, Florida; William Frederick Heyd, an expert in acute care hospital equipment planning who is an architect for Gene Burton and Associates; Karen Kenny Ripper, R.N., Chief Nursing Officer, Martin Memorial Health Systems, an expert in hospital administration and nursing administration; John Tagliareni, Vice-President Administrator and Chief Strategic Planning Officer for Martin Memorial Health Systems

and Administrator for the 100-bed hospital operated on Salerno Road known as Martin Memorial Hospital South; Michael Sonenblum, M.D., pediatrician; William Carlson, M.D., a board-certified orthopedic surgeon who is a member of the American Academy of Orthopedic Surgeons; Peter Zeblisky, D.O., internist and geriatrician; and Cynthia Pingolt, a registered respiratory therapist who serves as assistant Vice President for Professional Services, Martin Memorial Health Systems. Martin's Exhibits 1-9, 11-32, 33A, 33B, 34, 34A, 35, 36, 37, 37A, 37B,

37C, 37F, 38, and 39 were admitted into evidence.

The Agency presented the testimony of Jeffrey N. Gregg, Bureau Chief of Health Facility Regulation, who was accepted as an expert in health planning and CON review. AHCA Exhibits 1 and 2 were received in evidence.

The Petitioners presented the testimony of Gary Cantrell, the CEO of St. Lucie, an expert in health care administration; Nancy Hilton, an expert in nursing, nurse administration, nurse recruitment and staffing; David Mulholland, an expert in traffic engineering, traffic and transportation planning and travel time studies; Richard Baehr, an expert in health planning and health finance; Rodney Smith, the CEO of Lawnwood, an expert in hospital administration; Patrick McLaughlin, an expert in strategic business planning, including analysis of market conditions and the economic impact of those conditions; and

Daryl Weiner, an expert in health care planning, including financial feasibility. The Petitioners' Exhibits 1-10, 12-18, 20, 28-30, 32, 39-42, 39A, 43A, 43B, 43C, 44-49, 51, 52, 54, 72,

1. , and 83 were accepted into evidence.

   
   

   The 20-volume Transcript of the final hearing was filed with DOAH on December 24, 2008. By stipulation of the parties the Proposed Recommended Orders were filed March 6, 2009.

   Additionally, the parties' request to enlarge the page limitation for the Proposed Recommended Orders was granted. All parties timely filed Proposed Recommended Orders that have been fully considered in the preparation of this Recommended Order.

   FINDINGS OF FACT

   
   

   The Parties

   
   

   1. AHCA is the state agency charged with the responsibility of administering the CON program for the state of Florida. The Agency serves as the state heath planning entity. See § 408.034, Fla. Stat. (2007). As such, it was charged to review the CON application at issue in this proceeding. AHCA has preliminarily approved Martin's CON application No. 9981.

   2. The Petitioners are existing providers who oppose the approval of the subject CON. St. Lucie is a 194-bed acute care hospital located on U. S. Highway 1 in Port St. Lucie, Florida, that opened in 1983. Included in the bed count are 17 obstetric beds and 18 intensive care beds. St. Lucie utilizes 7 operating

      rooms and provides a varied list of surgical services. Although St. Lucie does not provide tertiary services, it offers an impressive array of medical options including general and vascular surgery, orthopedics, spine surgery, neurosurgery, and gynecology. Furthermore, St. Lucie is a designated stroke center and it is fully accredited by the Joint Commission on Accreditation of Healthcare Organizations (JCAHO). The JCAHO mission is to improve the safety and quality of care provided to the public through the provision of health care accreditation and related services that support performance improvement in health care organizations.

   3. St. Lucie uses a hospitalist program 7 days per week,

      
      

      12 hours per day. The hospitalist program is a group of physicians who are employed by the hospital to manage the care of its patients. St. Lucie believes the hospitalist program moves patient cases more quickly and efficiently. St. Lucie has committed financial resources to its hospitalist program and hopes to expand its use in the future.

   4. The emergency department (ED) at St. Lucie handles approximately 42,000 visits per year. The ED has 24 beds comprised of 16 regular beds and 8 "fast track" beds. All areas are either curtained or separated by dividers to provide for patient privacy.

   5. Historically, St. Lucie has expanded the ED to provide for additional space for emergent patients. One of the strategies it has used includes the installation of special chairs in a waiting triaged area.

   6. The other Petitioner, Lawnwood, is located in Ft.

      
      

      Pierce, Florida, near I-95 and the Florida Turnpike. Lawnwood has 341 beds and, in additional to traditional medical/surgical options, provides tertiary services such as neurosurgery and open heart. Lawnwood also provides Level II neonatal intensive care services. Like St. Lucie, Lawnwood is fully accredited by JCAHO. Lawnwood has provided quality health care services to its region for over 30 years.

   7. The Lawnwood ED handles approximately 40,000 visits per year in a 28-bed unit.

   8. At its current location Lawnwood can expand its facilities should it desire to do so. At the current time, however, it has no plans for expansion of its main campus. It does plan to initiate an expansion of its intensive care unit. Financing for that expansion was anticipated to become more definite in 2009.

   9. In furtherance of its efforts to promote itself as a regional provider of quality medical services, Lawnwood has begun the arduous process of becoming a Level I trauma program for a multi-county area. In this regard, Lawnwood asserts that

      its service area for trauma patients encompasses Indian River County, St. Lucie County, parts of Okeechobee County, and portions of Martin County, Florida. Lawnwood has invested in the capital improvements needed to fully implement this program.

   10. The Petitioners are owned and operated by Hospital Corporation of America (HCA), a for-profit corporation headquartered in Nashville, Tennessee. HCA has input into the decisions affecting Petitioners and can influence when the improvements they hope to implement will be finalized.

   11. In addition to the Petitioners, other providers in the district include Indian River Hospital located in Vero Beach, Florida, and Martin Memorial Medical Center, Inc. with two hospitals in Martin County, Florida. It is the latter competitor that seeks to establish a new hospital in the western portion of St. Lucie County, Florida.

   12. Martin is a private, not-for-profit Florida corporation licensed to operate Martin Memorial Hospital North, in Stuart, Florida, and Martin Memorial Hospital South, in Port Salerno, Florida. The northern facility has 244 licensed beds; the southern hospital has 100 licensed beds. The northern hospital is the older provider and has served patients from

       St. Lucie and Martin Counties for over 70 years.

       
       

   13. Like Lawnwood, Martin offers a broad range of acute care hospital services including tertiary services. The options

       available at Martin include open-heart surgery, complex wound care, oncology, obstetrics, neonatal intensive care, pediatrics, and orthopedics. Martin provides high-quality medical services to its patients in both outpatient and inpatient venues. To that end Martin has been active in the western portion of

       St. Lucie County for a number of years and has solidified relationships with physicians in that area of the district.

   14. In this regard, Martin established an urgent care center in Port St. Lucie back in 1984. Since that time it has repeatedly sought to expand its provision of medical care to the residents of St. Lucie County. Martin constructed a physicians complex that employs and provides offices for physicians most of whom are on staff at St. Lucie. Over 80 percent of the patients from the Martin physician complex get admitted to St. Lucie.

   15. Martin also established a second outpatient facility in the western portion of St. Lucie County. This 70,000 square foot center provides 500-600 treatments per month to its patients. Among the services provided at this facility include a broad range of diagnostic and laboratory services, radiation therapy, rehabilitation therapy, and pediatric medicine.

   16. Finally, Martin also intends to establish a freestanding ED in the western portion of St. Lucie County in 2009. This facility will provide another access point for

       patients in the western portion of the county to facilitate a quicker response for patients who seek emergency care.

   17. Martin views this proposed freestanding ED as an interim measure and will convert it to an urgent care or other non-acute use if the proposed hospital it seeks to construct is approved.

       The Proposal

       
       

   18. Martin seeks to construct a general acute care hospital consisting of 80 beds, with intensive care, an ED, telemetry, and obstetrics. It will not offer tertiary services.

   19. The site for the proposed hospital is in an area known as "Tradition," a planned community in the western portion of St. Lucie County. The City of Port St. Lucie has annexed the geographical area into what residents consider "West Port St. Lucie" and have designated an area of Tradition to promote the life sciences industry.

   20. Accordingly, Tradition has areas reserved for medical office buildings, research facilities, as well as the hospital site to be used by Martin. Martin's proposed site is adjacent to the Torrey Pines Molecular Research Institute.

   21. The entire Tradition and West Port St. Lucie area is within AHCA's District 9, Subdistrict 2.

   22. By locating the new hospital in the western portion of the county, Martin maintains it will promote and enhance access for current and future residents of the developing area without adversely impacting St. Lucie and Lawnwood.

   23. Another advantage to a hospital in the western portion of the county is the option of having a haven in the event of a hurricane or natural disaster in the eastern portion of the county. Since the site is located to the west of the coastline, storm surges would not likely impact the facility or dictate evacuation. Further, the site provides excellent geographic access for traffic and the population of the expanding western portions of the county. Like other geographical areas, the coastal portion of the county faces “build out” that will limit the population expansion anticipated in that area. The proposed area has yet to face any limitation in that regard. It is the most likely geographic area that will expand as the population grows.

   24. HCA also recognized the benefits of the western area for future expansion of its medical facilities. It unsuccessfully negotiated to acquire a hospital site at or near the proposed location.

   25. In relation to the other parties, the proposed site is north and west of the Martin hospitals in Martin County, west of St. Lucie, and south and west of Lawnwood.

   26. The size of the parcel is adequate to construct the hospital.

   27. In reaching its decision to seek the approval of the new hospital, Martin considered input from many sources, including, but not limited to: physicians who practice in the vicinity of the proposed hospital; emergency response personnel who transport patients to the various district hospitals; medical researchers who have located to or are locating to the proposed area; elected officials familiar with the medical needs of the community; and health care planning professionals.

   28. The St. Lucie River divides St. Lucie County east to west. Only the areas west of the river have been designated as the primary service area for the proposed hospital. The primary service area comprises the land within zip codes 34983, 34984, 34986, 34953, 34987, and 34988. The secondary service area comprises those lands encompassed by zip codes 34981, 34982, 34952, and 34957. These primary and secondary service areas have been reasonably determined to project admissions and other relevant use data. As is later addressed in more detail, the population projected for the service area will reasonably support the utilization required to make the proposed hospital financially feasible.

       Review Criteria

       
       

   29. Every new hospital project in Florida must be reviewed pursuant to the statutory criteria set forth in Section 408.035, Florida Statutes (2007). Accordingly, the ten subparts of that provision must be weighed to determine whether or not a proposal meets the requisite criteria. In this case, the parties have identified the provisions of law that pertain to this matter.

   30. Section 408.035(1), Florida Statutes (2007) requires that the need for the health care facilities and health services being proposed be considered. In the context of this case, "need" will not be addressed in terms of its historical meaning. The Agency no longer calculates "need" pursuant to a need methodology. Therefore, looking to Florida Administrative Code Rule 59C-1.008, requires consideration of the following pertinent provisions:

       . . . If an agency need methodology does not exist for the proposed project:

       
       

       1. The agency will provide to the applicant, if one exists, any policy upon which to determine need for the proposed beds or service. The applicant is not precluded from using other methodologies to compare and contrast with the agency policy.

          
          

       2. If no agency policy exists, the applicant will be responsible for demonstrating need through a needs assessment methodology which must include, at a minimum, consideration of the following topics, except where they are inconsistent

          with the applicable statutory or rule criteria:

          
          

          1. Population demographics and dynamics;

          2. Availability, utilization and quality of like services in the district, subdistrict or both;

          3. Medical treatment trends; and,

          4. Market conditions.

          
          

       3. The existence of unmet need will not be based solely on the absence of a health service, health care facility, or beds in the district, subdistrict, region or proposed service area.

          
          

   31. According to Martin, "need" is evidenced by a large current and projected growing population in the proposed service area (PSA), sustained population growth that exceeds the district and state averages, capacity constraints at the existing providers, geographic access barriers including traffic congestion and the St. Lucie River, the need for improved access for emergency medical services, enhanced geographic and financial access to obstetrical services for residents of the western portion of the county, growth to offset impact on existing providers, and the financial health of existing providers.

   32. As previously stated, St. Lucie County is divided by the St. Lucie River. The river is crossed west-to-east by a limited number of bridges that can back up and delay the traffic utilizing them for access to St. Lucie. The county is traveled north to south by two major roadways: U.S. Highway 1 and I-95.

       To travel from the western portions of the county and the Tradition community, vehicles cross I-95, the river, and travel

       U.S. Highway 1 to St. Lucie.

       
       

   33. The PSA is the fastest growing portion of the county.

       
       

       The older areas to the east are not growing at the rate associated with the development of Tradition and other communities to the west. Some of the coastal areas to the east have become "saturated." That is to say, building and growth restrictions along the coast have limited the population in those areas. The western portion of the county is one of the most rapidly growing communities in the state and has become one of the focal areas of growth for the region. Although the rate of growth has slowed in the recent economic decline, the St.

       Lucie County area is still predicted to grow at an increased pace in the near future.

   34. Population projections prepared by the Bureau of Economics and Business Research at the University of Florida demonstrate that the growth reasonably expected for the PSA is fairly dramatic. According to Dr. Smith, whose testimony has been credited, the primary service area population is expected to reach or exceed 180,977 by 2015. If underestimated (as is typical of these types of projections), the growth could easily exceed that projection. The projection was based upon the most currently available data and has not been contradicted by more

       reliable data. Claritas data also suggested that the projections produced by Dr. Smith's work were reasonable.

   35. The projected growth rate in the primary service area exceeds the projected growth rate of the district as well as for Florida for the period 2007-2015. This finding is supported by the credible weight of the data admitted into evidence.

   36. Although the population growth has slowed due to economic conditions, the county will experience renewed growth in the PSA with the projected reversal of slowing trends. Development in the PSA continues to be the most likely geographic area that will be improved first and faster than other areas of the county.

   37. Looking at the age component of the population projected for the PSA, the age 65 and over cohort is the fastest growing segment of the population; the second is the 45-64 population segment. These segments are the majority of the acute care hospital utilization. Additionally, females ages 15-

       44 also reflect a high rate of growth for the primary service area. This latter statistic supports the notion that a demand for obstetrics is likely.

   38. Acute care hospital utilization in the subdistrict increased from 2003 through June 2008. The non-tertiary discharges within the primary service area increased by 42 percent for the period 2003 to 2007. Birth volume in the

       primary service area increased for the same period and doubled the number of obstetric admissions for the time noted. This increase in utilization supports the likelihood that population growth for the area will further increase the utilizations expected for the PSA.

   39. Historically, St. Lucie has observed this utilization and growth of demand for its services. St. Lucie has responded by adding beds to its ED but the projections would suggest that past and future growth will result in capacity constraints for St. Lucie. Demand for intensive care, medical surgical beds, and progressive care beds at St. Lucie has been high. The ICU occupancy rate at St. Lucie in particular has been at or above

       85 percent capacity a significant portion of the time.

       
       

   40. Capacity issues are more pronounced during the months from November through May of each year. The subdistrict enjoys a strong seasonal influx of residents who require all the amenities of a community including medical care. In this regard, St. Lucie has seen a "bed crunch" in order to accommodate the seasonal patients. This crunch results in longer ED waits, longer waits for admissions for those requiring acute care, longer waits for those seeking elective admissions, and longer waits for some services such as blood transfusions.

   41. Although hospitals are not intended to be like fast food restaurants (providing all services on a expedited basis),

       extended waits for bed placement can place waiting patients on gurneys in less than optimal conditions. This scenario does not promote efficient or the most effective form of providing health care services to those in need.

   42. The bed crunch at St. Lucie is expected to continue due to increasing demand for acute care hospital services in the county.

   43. Capacity constraints are similarly demonstrated at Lawnwood and Martin. Like St. Lucie, Lawnwood and Martin experience the seasonal crunch associated with the increased population during the winter months.

   44. In Lawnwood's case, the ED has delays through out the year. This means that patients wait for a bed assignment in the ED until a suitable room placement can be made. Additionally, the intensive care unit at Lawnwood experiences high occupancy. As Lawnwood transitions to a trauma center, the demand for acute care beds will also increase. Lawnwood will be the sole trauma center for the region and will likely receive an increase in utilization from that patient source.

   45. Martin also has experienced high utilization and has operated at or near capacity for extended periods during the season. Further, the birth volume growth for Martin supports the conclusion that additional obstetric beds are needed for the

       subdistrict. The majority of Martin's increased birth volume has come from the PSA.

   46. Martin has also established that obstetrics patients travel from areas closer to Lawnwood or St. Lucie to seek services at Martin. This demand for obstetrical services in the PSA also suggests that the proposed hospital would enhance access to obstetrics in the subdistrict. Patients who might be induced (as the mother is past her due date) for labor must, at times, wait for a delivery bed. Additionally, patients who present in labor do not always have a labor bed. The new facility would ease these constraints.

   47. The location of the hospital at Tradition will also improve geographic access to medical facilities. The traffic and natural barriers to health care services (limited west to east roadways and the river) would be eliminated by the proposed facility. Additionally, during periods of storm events, residents throughout the subdistrict would have access to an acute care hospital without driving to the coastal area.

   48. The demand for emergency medical response and transport in St. Lucie County has increased dramatically. The St. Lucie County Fire Department transports all patients requiring advanced life support services in the county. When traveling from the western portions of the county, the emergency transports use the same roadways to cross the river as the

       general population. Delays are common. Even after delivering a patient to the St. Lucie ED, the transport must return west from its point of origin in order to return to service. The delays in traversing the county result in delays for the unit to be able to respond to the next call. Although it is impractical to have a hospital on every corner, the establishment of a hospital at Tradition would greatly enhance the response times for emergency vehicles and enhance their ability to return to service more quickly. To respond to the increased population and need in the Tradition community, the county has established two new fire stations in the area. The primary service area has the greatest need for additional fire and emergency services according to Chief Parrish.

   49. To help address the problem of having rescue units out of service for extended periods of time while transporting patients to an existing hospital east of the river (or while they are returning west to their service area), the Fire Department has doubled rescue trucks and paramedics at two stations in the western portion of the county. This duplication of manpower and equipment increases emergency costs for the county.

   50. Although there are plans for the construction of another bridge across the river that would ease some of the congestion in crossing the county, it is unknown when that

       bridge will be funded and constructed. City personnel do not expect the bridge to be started prior to 2017.

   51. The proposed hospital will provide improved access for emergency medical services.

   52. The proposed hospital will provide enhanced access to obstetrical services for the residents of the PSA.

   53. With regard to financial access, the weight of the credible evidence supports the finding that residents of the PSA are able to adequately access medical services. Existing providers are meeting the needs of the needy and those without ability to pay. Although the new hospital would provide a closer point of service for the indigent or Medicaid recipients who may lack transportation advantages of the more affluent, the needy are currently being served by existing providers.

   54. The existing providers are financially healthy and are well able to meet the needs of the indigent. Should the new hospital siphon off the more desirable patients (ie. the insured, Medicare, self-pay, etc.), the existing providers should be able to continue to provide the indigent care needed by the subdistrict. Additionally, the new hospital would also be expected to accept Medicaid or indigent patients.

   55. Travel times within the subdistrict further suggest that the addition of a new hospital would reduce the time for all residents to arrive at an acute care hospital. Although the

       travel times currently suggest that patients could access an existing provider within 40 minutes, the addition of the new facility would ensure that during crunch times or times of traffic congestion or other times when factors extend the time for access to service, any patient from the PSA can be assured of prompt medical care.

   56. Establishment of the new hospital will also improve access in the event of a catastrophe or disaster. Given the recent history of hurricanes in the state, improved access to medical facilities in times of crisis can be critical to the patient as well as the emergency crews working during such events.

   57. To the extent that any existing provider loses admissions to the new hospital, the growth in population and projected admissions will adequately offset the loss of admissions. Further, the utilization expected by all providers will adequately assure their financial stability as the new provider achieves or exceeds its projected goals.

   58. Martin has demonstrated a strong financial position for a number of years. The establishment of the new hospital will not compromise Martin's financial strength or detract from its provision of services at the two hospital campuses it currently utilizes. The new, third campus will complement and enhance the Martin Health Care System.

   59. Martin has demonstrated the project is financially feasible both in the short and long term. Martin's past financial performance and continued strong financial position assure that it will be able to obtain financing for the proposed hospital construction and start up. Moreover, the projected patient days to be captured by the new hospital will assure that the hospital will achieve its "break even" financial point at a reasonable future date. The project should achieve revenues in excess of expenses by its third year of operation.

   60. The projections for utilization are reasonable and are based upon reasonable assumptions including the premise that Martin will redirect admissions from its southern facilities to services more geographically accessible at the new hospital. Martin has an established presence in the PSA and should be able to achieve its expected admissions without adversely impacting St. Lucie or Lawnwood.

   61. The revenue projections for the new hospital are reasonable and should be achieved.

   62. Martin has the resources, the workforce, and physician coverage to provide for the new hospital. Additionally, it is expected that new physicians will seek privileges at the new hospital and will provide emergency on-call coverage as may be needed. St. Lucie and Lawnwood have coverage for the medical specialties and ED departments at their facilities.

   63. Martin has a low vacancy and turnover rate for both nursing and non-nursing personnel. It partners with the community to sponsor initiatives that promote continued success in these areas. It is a favored employer among those in Martin County.

   64. The staffing projections for nursing and clinical support for the new hospital are reasonable. The projected salaries are also in line with those currently offered and should be reasonable and easily achieved. In short, the applicant has demonstrated that Schedule 6A of the application is supported by the record in this cause.

   65. Martin has demonstrated it is able to implement the project and to staff its needs at the levels projected by the application.

   66. St. Lucie County will grow at a sufficient rate to assure that all providers, including the proposed hospital, will have admissions to meet the financial needs of the institutions. Moreover, the growth anticipated is sufficient to fund the future improvements or expansions that may be required by the providers. Essentially, when considered as a whole, west to east, the county has sufficient growth potential to support the additional acute care hospital beds proposed by the applicant.

   67. Competition for the future beds will be enhanced by the additional provider. St. Lucie and Lawnwood will continue

       to perform well in the market. St. Lucie will continue to achieve the lion's portion of the market east of the river while Lawnwood will continue to serve the region as it has with tertiary and the newly added trauma services. If anything, Martin will take the largest hit from the establishment of the new hospital as it will seek to allow its patients from the PSA that currently travel south and east to Martin hospitals to remain in their community at the new facility. Acting as the "mother ship," Martin is willing to promote the new hospital so that the stresses it has at the Martin County hospitals may be alleviated. The Martin system as a whole will continue to grow and benefit from the addition of the new hospital.

   68. Martin is the chief initiator of medical services to the western St. Lucie County community. No HCA hospital has attempted to establish a presence in the Tradition area that matches or exceeds the commitment Martin has made to the residents of western St. Lucie County.

   69. St. Lucie and Lawnwood will continue to provide quality care to their patients and will continue to be financially strong should the new hospital come on line.

   70. The adverse impact suggested by the HCA hospitals is not supported by the weight of the credible evidence in this cause. In short, the market projections are adequate to assure all providers will continue to share a significant portion of

       the health care pie. The growth in population, growth in admissions and utilization, the demographics of the population, and the reputation of all providers to provide quality care support the long term success of all providers in the subdistrict.

   71. The establishment of the new hospital will also promote competition as medical and clinical research also come into play. Should the new hospital located near the research facilities promote clinical trials, all providers in the subdistrict would benefit from any successful achievements.

   72. Martin has agreed to the following conditions for the

       
       

       CON:

       
       

       Martin will partner with Torrey Pines Institute for Molecular Studies for the provision of resources associated with clinical trials and life science research.

       
       

       Martin will continue to support the Volunteers in Medicine program with free inpatient and outpatient hospital services, outpatient laboratory, diagnostic and treatment services at a value of not less than $750,000 of charges per year for the next 10 years.

       
       

       Martin will support other community social services organizations in the form of cash, goods and services valued at not less than

       $75,000 annually for the next 10 years. This represents a commitment of $750,000 to support organizations such as Meals on Wheels, American Cancer Society, American Heart Association, etc.

       Martin will support Florida Atlantic University Nursing School, Indian River Community College and other area nursing and allied health schools with at least $75,000 per year in services or goods for the next

       10 years to help ensure an adequate supply of well-trained health care professionals.

       
       

       Martin will establish a volunteers program (based on its current successful program in Martin County) in Port St. Lucie area to involve local high schools in encouraging teens to volunteer in health care settings and to encourage health care careers.

       
       

       Martin will partner with the St. Lucie school system in the development of a High School Medical Academy.

       
       

       Martin will make the West Port St. Lucie Hospital available as a training site for area nursing and allied health schools and for the Florida State University physician training program.

       
       

       Martin will locate the new hospital south of Tradition Parkway, east of Village Parkway, adjacent to the Torrey Pines headquarters and the I-95 Gatlin Boulevard exit.

       
       

       Martin will provide a minimum of 11.1 percent of its total annual patient days in the new hospital to Medicaid and Medicaid HMO patients.

       Martin will also provide a minimum of

       $250,000 per year for Medicaid and/or charity outreach programs within the western Port St. Lucie area for the first five years of operation.

       
       

   73. This is not the first CON application submitted by Martin to establish a hospital in the western portion of

       St. Lucie County. The current application differs from others in that the updated population and utilization data more clearly

       establish that the projected growth for the subdistrict will support the new facility without unduly impacting the existing providers. The planning horizon for the instant application and the pertinent data show that the western portion of the county more closely resembles areas that have been granted satellite or new hospital facilities in other areas of the state. The growth projected for the county mandates additional healthcare resources be devoted to the PSA. Additionally, similar to its commitment to the Martin County residents, the applicant has demonstrated it will partner with the St. Lucie County resources to establish the same programs that have benefited other areas of the subdistrict. Finally, while the Torrey Pines affiliation was represented in prior applications, that facility is now a reality and operational. The benefits of having the Martin hospital adjacent to its facility is no longer speculative.

   74. Torrey Pines is a nationally recognized research entity. The State of Florida and St. Lucie County governmental entities have pursued this type of research facility for location to the state and this area. According to the Torrey Pines leadership, the location of the Martin hospital in proximity to its facility would enhance their efforts.

   75. The architectural schematics, project completion schedule, design narratives, and code compliance information set fort in Martin's application are reasonable. The site

       preparation and construction costs set forth on Schedule 9 are reasonable for the project proposed. Additionally, the equipment costs are reasonable.

   76. There is no financial barrier to access hospital services by the residents of the PSA.

   77. The quality of care rendered by all hospitals in the subdistrict is excellent.

   78. Although there may be some impact on the admissions and utilization at St. Lucie, the impact is not of such a magnitude so as to adversely impact the quality of care and provision of health services at that hospital.

   79. The impact expected at Lawnwood should be less than St. Lucie, nevertheless, it too is not of such a magnitude so as to adversely impact the quality of care and provision of health services at that hospital.

   80. Section 408.035(2), Florida Statutes (2007), specifies that the availability, quality of care, accessibility, and extent of utilization of existing health care facilities and health services in the service district must be considered. As noted above, there is no barrier to services in the subdistrict. Nevertheless, Martin has demonstrated that access to additional services will be enhanced by the establishment of the new hospital in the western area of the county. Additionally, delays in admissions and capacity constraints at the existing

       hospitals although not chronic or at a critical juncture are evidenced in the record.

   81. Section 408.035(3), Florida Statutes (2007), requires the consideration of the ability of the applicant to provide quality of care and the applicant's record of providing quality of care. This criterion is not in dispute in this cause.

   82. Section 408.035(4), Florida Statutes (2007), requires the review of the availability of resources, including health personnel, management personnel, and funds for capital and operating expenditures, for project accomplishment and operation. In this regard, Martin has established that it is able to provide the resources necessary for this project. Additionally, it has shown that projected salaries for the nurses (as depicted on Schedule 6A) are reasonable and within the general guidelines of Martin's provision of those services at its other hospitals.

   83. Section 408.035(5), Florida Statutes (2007), specifies that the Agency must evaluate the extent to which the proposed services will enhance access to health care for residents of the service district. In the findings reached in this regard, the criteria set forth in Administrative Code Rule 59C-1.030(2) have been fully considered. Those provisions are:

       (2) Health Care Access Criteria.

       1. The need that the population served or to be served has for the health or hospice

          services proposed to be offered or changed, and the extent to which all residents of the district, and in particular low income persons, racial and ethnic minorities, women, handicapped persons, other underserved groups and the elderly, are likely to have access to those services.

       2. The extent to which that need will be met adequately under a proposed reduction, elimination or relocation of a service, under a proposed substantial change in admissions policies or practices, or by alternative arrangements, and the effect of the proposed change on the ability of members of medically underserved groups which have traditionally experienced difficulties in obtaining equal access to health services to obtain needed health care.

       3. The contribution of the proposed service in meeting the health needs of members of such medically underserved groups, particularly those needs identified in the applicable local health plan and State health plan as deserving of priority.

       4. In determining the extent to which a proposed service will be accessible, the following will be considered:

          1. The extent to which medically underserved individuals currently use the applicant’s services, as a proportion of the medically underserved population in the applicant’s proposed service area(s), and the extent to which medically underserved individuals are expected to use the proposed services, if approved;

          2. The performance of the applicant in meeting any applicable Federal regulations requiring uncompensated care, community service, or access by minorities and handicapped persons to programs receiving Federal financial assistance, including the existence of any civil rights access complaints against the applicant;

          3. The extent to which Medicare, Medicaid and medically indigent patients are served by the applicant; and

          4. The extent to which the applicant offers a range of means by which a person will have access to its services.

       5. In any case where it is determined that an approved project does not satisfy the criteria specified in paragraphs (a) through (d), the agency may, if it approves the application, impose the condition that the applicant must take affirmative steps to meet those criteria.

       6. In evaluating the accessibility of a proposed project, the accessibility of the current facility as a whole must be taken into consideration. If the proposed project is disapproved because it fails to meet the need and access criteria specified herein, the Department will so state in its written findings.

       
       

   84. AHCA does not require that a CON applicant demonstrate that the existing acute care providers within the PSA are failing in order to approve a new hospital. Also, AHCA does not have a travel time standard with respect to the provision of acute care hospital services. In other words, there is no set geographical distance or travel time that dictates when a hospital would be appropriate or inappropriate. In fact, AHCA has approved hospitals when residents of the PSA live within twenty minutes of an existing hospital. As a practical matter this means that travel time or distance do not dictate whether a satellite should be approved based upon access. With regard to access to emergency services, however, AHCA does consider patient convenience.

   85. In this case, the proposed hospital will provide a convenience to residents of western St. Lucie County in terms of access to an additional emergency department. Further, physicians serving the growing population will have the convenience of admitting patients closer to their residences. Medical and surgical opportunities at closer locations is also a convenience to the families of patients because they do not have to travel farther distances to visit the patient. Patients and the families of patients seeking obstetrical services will also have the convenience of the hospital.

   86. Patients who would not benefit from the convenience of the proposed hospital would be those requiring tertiary health services. Florida Administrative Code Rule 59C-1.002(41) defines such services as:

       (41) Tertiary health service means a health service which, due to its high level of intensity, complexity, specialized or limited applicability, and cost, should be limited to, and concentrated in, a limited number of hospitals to ensure the quality, availability, and cost effectiveness of such service. Examples of such service include, but are not limited to, organ transplantation, specialty burn units, neonatal intensive care units, comprehensive rehabilitation, and medical or surgical services which are experimental or developmental in nature to the extent that the provision of such services is not yet contemplated within the commonly accepted course of diagnosis or treatment for the condition addressed by a given service.

   87. In terms of tertiary health services, residents of the subdistrict will continue to use the existing providers who offer those services. The new hospital will not compete for those services.

   88. Lawnwood will continue to provide tertiary services to the PSA and will continue to be a strong candidate for any patient in the PSA requiring trauma services when that service comes on line.

   89. Section 408.035(6), Florida Statutes (2007) provides that the financial feasibility of the proposal both in the immediate and long-term be assessed in order to approve a CON application.

   90. In this case, as previously indicated, the utilizations expected for the new hospital should adequately assure the financial feasibility of the project both in the immediate and long-term time frames. Population growth, a growing older population, and technologies that improve the delivery of healthcare will contribute to make the project successful.

   91. The new Martin hospital will afford PSA residents a meaningful option in choosing healthcare and will not give any one provider or entity an unreasonable or dominant position in the market.

   92. Section 408.035(7), Florida Statutes (2007) specifies that the extent to which the proposal will foster competition that promotes quality and cost-effectiveness must be addressed.

   93. This subdistrict enjoys a varied range of healthcare providers. All demonstrate strong financial stability and utilization. A new hospital will promote continued quality and cost-effectiveness. Physicians will have another option for admissions and convenience.

   94. Section 408.035(8), Florida Statutes (2007), notes that the costs and methods of the proposed construction, including the costs and methods of energy provision and the availability of alternative, less costly, or more effective methods of construction should be reviewed.

   95. The methodology used to compute the construction costs associated with this project were reasonable and accurate at the time prepared. No more effective method of construction has been proposed. The financial soundness of the proposal should cover the actual costs associated with the construction of the project. Additionally, the free-standing ED that Martin is constructing will be transitioned to a urgent care clinic or some other health care facility, it will not continue to provide emergent services when the new hospital is on line. Therefore, it should not be considered a less costly alternative for ED services.

   96. Section 408.035(9), Florida Statutes (2007), provides that the applicant's past and proposed provision of health care services to Medicaid patients and the medically indigent should be weighed in consideration of the proposal.

   97. Martin has a track record of providing health care services to Medicaid patients and the medically indigent without consideration of any patient's ability to pay. The new hospital would be expected to continue this tradition. Moreover, this criterion is adequately addressed by the proposed conditions to the CON approval.

   98. Section 408.035(10), Florida Statutes, relates to nursing home beds and is not at issue in this proceeding.

       The Agency's Rationale

       
       

   99. The SAAR set forth the Agency's rationale for the proposed approval of the CON application. The SAAR acknowledged that the proposal received varied support from numerous sources. Further, the SAAR acknowledged that funding for the project would be available; that the short-term position, long-term position, capital requirements, and staffing for the proposal were adequate; that the project was financially feasible if the applicant meets its projected occupancy levels; that the project would have a positive effect on competition to promote quality and cost-effectiveness; and that the construction schedule is reasonable.

   100. The SAAR also recognized the improved access for obstetrical services for residents of the growing western

        St. Lucie County. This also reinforced the generally recognized improvements to access geographically given the limitations in east-west traffic access. Finally, the SAAR recognized that Martin is the provider that has invested in the western portion of the subdistrict by establishing clinics and physician networks to provide care to the residents of the PSA. Opponents to the new hospital have not similarly committed to the residents of western St. Lucie County. The opponents maintain that enhanced access for residents of the PSA does not justify the establishment of a new hospital since the residents there already have good access to acute care services.

        CONCLUSIONS OF LAW

        
        

   101. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of these proceedings. §§ 120.569 and 120.57(1), Fla. Stat. (2007).

   102. Martin has the burden to prove by a preponderance of the evidence that its CON application should be approved. See, e.g., Boca Raton Artificial Kidney Center, Inc. v. Dept. of

        Health and Rehabilitative Servs., 475 So. 2d 260, 263 (Fla. 1st DCA 1985); § 120.57(1)(j), Fla. Stat. (2007).

   103. The Agency's preliminary decision and the findings in the SAAR are not entitled to a presumption of correctness in

        this de novo proceeding. See generally Dept. of Transportation v. J.W.C. Co., Inc., 396 So. 2d 778, 787 (Fla. 1st DCA 1981).

        The Agency's construction and interpretation of its rules and the statutes that it is charged to implement, however, are entitled to deference. See, e.g., State Contracting & Engineering Corp., v. Dept. of Transportation, 709 So. 2d 607, 610 (Fla. 1st DCA 1998); § 120.57(1)(l), Fla. Stat. (2007).

   104. The decision of whether to approve a CON application must be based on a balanced consideration of all statutory and rule criteria. St. Joseph's Hospital v. Department of Health and Rehabilitative Services, 536 So. 2d 346 (Fla. 1st DCA 1988); Department of Health and Rehabilitative Services v. Johnson &

        Johnson Home Healthcare, Inc., 447 So. 2d 361 (Fla. 1st DCA 1984); Balsam v. Department of Health and Rehabilitative Services, 486 So. 2d 1341 (Fla. 1st DCA 1986). The weight to be given to each criterion is not fixed, but depends on the facts and circumstances of each case. Collier Medical Center, Inc. v. Department of Health and Rehabilitative Services, 462 So. 2d 83 (Fla. 1st DCA 1985).

   105. All parties in this cause have the requisite standing to participate in this proceeding pursuant to Section 408.039(5)(c), Florida Statutes (2007).

   106. In this case Martin has presented a need methodology that argues the new hospital should be approved. The Agency

        supports that conclusion and the rationale for its preliminary decision of approval is cogently articulated in the SAAR. The opponents disagree (for the most part) based upon their perception that the area growth has slowed, that the utilizations projected are not reasonable, and that the existing providers will be adversely affected by the new hospital.

   107. As to Martin's methodology, this applicant has demonstrated a new hospital in Tradition will enhance emergency department access. Further, the new hospital will provide patients with a meaningful option for hospital services in the western portion of St. Lucie County. The new hospital will offer enhanced access to obstetrical services to residents of the PSA. And finally, it will offer reduced travel times for patients and their families using the facility. These conveniences of access have been established.

   108. As to the Petitioners' concern that the new hospital will siphon patients from St. Lucie and Lawnwood, the projected growth in population in the PSA as well as the county as a whole should adequately generate sufficient patient days to alleviate such fears. If Martin is correct in its assessment, all of the providers in the subdistrict will continue to grow their admissions and/or patient days based upon population growth and increased utilization.

   109. Improving access to acute care hospital services including emergency services in non-urban areas experiencing growth (similar to the PSA herein) is the trend in medical treatment. The addition of the subject hospital will provide such services to a growing area of western St. Lucie County.

   110. Patients requiring tertiary services will not be benefited by the new hospital but those who require emergency services will have a second option that will lessen emergency department wait time. On balance Martin has established need for its proposed new hospital based upon its methodology, Florida Administrative Code Rule 59C-1.008(2)(e), as well as the criteria found in Section 408.035, Florida Statutes (2007).

   111. The opponents have argued that the doctrine of administrative finality precludes the approval of the instant CON application. According to St. Lucie and Lawnwood:

The doctrine of "administrative finality" ensures that decisions and orders of administrative agencies, like those of courts, have a point at which they become final and conclusive. See Florida Power & Light Co. v. Beard, 626 So. 2d 660, 662 (Fla. 1993) (citing Peoples Gas Sys.,Inc. v. Mason, 187 So. 2d 335, 339 (Fla. 1966)).

The Supreme Court of Florida has explained that, under administrative finality, "[a] decision, once final, may only be modified if there is a significant change in circumstances or if modification is required in the public interest." Florida Power Corp. v. Garcia, 780 So. 2d 34, 44 (Fla.

2001) (citing Austin Tupler Trucking, Inc.

v. Hawkins, 377 So. 2d 679, 681 (Fla.

1979)).

In this matter, it is concluded that Martin has presented significant changes in the circumstances that warrant approval of the CON application. Moreover, Martin has demonstrated a significant public interest in the approval of the new hospital. The population, utilization, demographics and ED needs of the western portion of St. Lucie County all support the approval of the new hospital for that area. The PSA will be better served as a result of the approval of the CON application and the applicant has adequately demonstrated the evidence supports that approval.

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 that approves CON Application No.

9981 with the conditions noted in the SAAR.

DONE AND ENTERED this 31st day of July, 2009, in Tallahassee, Leon County, Florida.

J. D. PARRISH 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 31st day of July, 2009.

COPIES FURNISHED:

Paul H. Amundsen, Esquire Julie Smith, Esquire Amundsen & Smith

502 East Park Avenue Post Office Drawer 1759

Tallahassee, Florida 32302

Karin M. Byrne, Esquire

Agency for Health Care Administration Fort Knox Building III, Mail Station 3 2727 Mahan Drive, Suite 3431

Tallahassee, Florida 32308

Robert A. Weiss, Esquire Karen A. Putnal, Esquire

Parker, Hudson, Rainer & Dobbs, LLP The Perkins House, Suite 200

118 North Gadsden Street Tallahassee, Florida 32301

Stephen A. Ecenia, Esquire

J. Stephen Menton, Esquire David Prescott, Esquire Rutledge, Ecenia, & Purnell

215 South Monroe Street, Suite 420 Post Office Box 551

Tallahassee, Florida 32302-0551

Richard J. Shoop, Agency Clerk

Agency for Health Care Administration 2727 Mahan Drive, Mail Station 3

Tallahassee, Florida 32308

Justin Senior, General Counsel

Agency for Health Care Administration Fort Knox Building, Suite 3431

2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

Holly Benson, Secretary

Fort Knox Building, Suite 3116 2727 Mahan Drive

Tallahassee, Florida 32308-5403

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: 07-003485CON

Orders for Case No: 07-003485CON