Conclusions THIS CAUSE comes before the AGENCY FOR HEALTH CARE ADMINISTRATION (the "Agency") concerning the Administrative Complaints for LIFE CARE CENTER OF SARASOTA, CON 7904, LIFE CARE CENTER OF ORANGE PARK, CON 7737, LIFE CARE CENTER OF NEW PORT RICHEY, CON 8813, LIFE CARE CENTER OF PORT ST. LUCIE, CON 8975, LIFE CARE CENTER OF OCALA, CON 7923 AND LIFE CARE CENTER OF MELBOURNE, CON 3828 collectively known as Life Care Centers of America (hereinafter "Life Care") which the Agency filed the Administrative Complaints for Life Care's failure to comply with Medicaid conditions placed on the CONs. Composite Exhibit 1. The parties have since entered into a Settlement Agreement. Exhibit 2. It is ORDERED that: The findings of fact and conclusions of law set forth in the Administrative Complaint are adopted and incorporated by reference into this Final Order. The Settlement Agreement is attached hereto and made a part hereof. The parties are directed to comply with the terms of the Settlement Agreement upon payment of any fines. The Respondent shall pay the Agency a total of $5,780.00 within 30 days of the date of this Final Order. The total amount is divided among the cases as such: Case Number 2008013528 - $323.00 Case Number 2008013522 - $663.00 Case Number 2009000372 - $1,663.00 Case Number 2009000369 - $1,530.00 Case Number 2009000371 - $1,365.00 Case Number 2008013532 - $236.00 A check made payable to the "Agency for Health Care Administration" and containing the AHCA ten-digit case numbers should be sent to: Office of Finance and Accounting Revenue Management Unit Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 14 Tallahassee, Florida 32308 The above-styled cases are hereby closed. DONE AND ORDERED this Z--1 day of 011, in Tallahassee, Florida. Elizab Agen tion
Other Judicial Opinions A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW, WHICH SHALL BE INSTITUTED BY FILING THE ORIGINAL NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A COPY ALONG WITH THE FILING FEE PRESCRIBED BY LAW WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF THE RENDITION OF THE ORDER TO BE REVIEWED. CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing Final Order has been furnished by U.S. or interoffice mail to the persons named below on this '/,:r: day of RICHARD J. SHOOP, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop #3 Tallahassee, Florida 32308 (850) 412-3630 COPIES FURNISHED TO: Charles A. Stampelos Administrative Law Judge Division of Administrative Hearings (Electronic Mail) Jay Adams, Esquire Broad and Cassel 215 South Monroe Street, Suite 400 Post Office Drawer 11300 Tallahassee, Florida 32302 Attorney for Life Care Centers of America (U. S. Mail) James H. Harris, Esquire Office of the General Counsel Agency for Health Care Administration (Interoffice Mail) Richard Joseph Saliba, Esquire Office of the General Counsel Agency for Health Care Administration (Interoffice Mail) Jan Mills Facilities Intake Unit Agency for Health Care Administration (Interoffice Mail) Office of Finance and Accounting Revenue Management Unit Agency for Health Care Administration (Interoffice Mail) MAR-17-2009 10:39 AGENCY HEALTH CARE ADMIN Mar 17 2009 10=25 850 921 0158 P.08 STATE OF PLORXDA
The Issue Whether Petitioner's application for a Certificate of Need and approval of a capital expenditure proposal pursuant to Chapter 381, Florida Statutes, and Section 1122 of the Social Security Act (42 U.S.C. 1320a-1), to establish a ten station chronic renal dialysis facility at Clearwater, Florida, should be granted. At a prehearing conference held on January 9, 1978, Bio-Medical Applications of Clearwater, Inc. was granted intervention as a party to these proceedings based on its current application for a Certificate of Need and for Section 1122 review of its capital expenditure proposal to establish a twenty station chronic renal dialysis facility in Clearwater, Florida, which is also the subject of state administrative proceedings at this time. The intervenor's Motion for Consolidation of its case with the instant case for the purposes of hearing was denied, after objection thereto by Petitioner. The Intervenor's Motion for a Continuance to enable it to conduct discovery procedures was denied in the absence of consent thereto by Petitioner, but the right was reserved to renew the motion after the final hearing had commenced. Intervenor did renew such motion at the time of final hearing. The motion was denied, it not having been shown that any discovery requests were then pending.
Findings Of Fact On September 21, 1977, Petitioner filed its application for a Certificate of Need and Section 1122 project review with Respondent. The application is for a ten station chronic dialysis unit to serve the needs of instate renal disease patients at Clearwater, Florida. The proposed facility would provide limited care hemodialysis for outpatients drawn primarily from north Pinellas and Pasco counties. Petitioner plans to lease space in a building providing easy access to Morton Plant Hospital, Clearwater, Florida. That hospital has agreed to provide the inpatient support services required by a freestanding hemodialysis unit. The hospital has approval for facilities to treat acute patients and is desirous of acting as a "backup unit" for petitioner's chronic patients who develop complications or otherwise require hospitalization. In addition, petitioner and Tampa General Hospital have an affiliation agreement whereby the hospital also will act as a "backup" facility to provide inpatient care for petitioner's dialysis patients. The Morton Plant Hospital has employed three nephrologists to staff its acute dialysis unit and these physicians intend to work also in Petitioner's chronic unit. The Morton Plant Hospital is the largest in Pinellas County and its assistant director testified that if petitioner is unable to establish its dialysis unit, there would be a serious adverse impact on the long-range plans of the hospital because it needs a nearby "feeder" for its acute unit. (Exhibit 4, Testimony of Pickering, Graves, McKinney) Petitioner is a nonprofit Florida corporation that is owned and directed by five nephrologists who currently practice medicine in the Tampa area. Four of the five physicians are full-time members of the instructional staff at the University of South Florida and also engage in private practice. The other physician is in full-time private practice. All five directors provide supervisory care of patients at Petitioner's Lakeland and Tampa, Florida, dialysis facilities, at the Tampa General Hospital and Tampa Veterans Administration Hospital. It is contemplated that the director of the proposed Clearwater dialysis unit will be Dr. Harry J. Free, a nephrologist and staff member of Morton Plant Hospital. Additional personnel that will be required in the proposed unit are a nursing supervisor, nurses, dietitian, social worker, technician, and clerical personnel. Petitioner plans to lease some 3500 square feet of space in an existing building with any necessary renovation costs built into the cost of the lease, which is estimated at eight to nine dollars per square foot. Suitable sites have been identified and are available in the Clearwater area. Petitioner plans either to lease or purchase necessary dialysis machines, water treatment equipment, and office and medical equipment at a total cost of approximately $77,000, depending on current resources. The cost of additional dialysis machines for home training will be paid out of a federal Department of Health, Education and Welfare grant to establish a home dialysis program, effective March, 1978, for a period of nine years. Based on the evidence presented, it is found that Petitioner's project is financially feasible and that the facility will be adequately staffed to provide effective health care. (Exhibit 4, Testimony of Pickering, McKinney) End-stage renal disease (ESRD) is the stage of kidney impairment when the human kidney has ceased to function and a machine must take over the function. Without dialysis, the ESRD patient will die. There are basically two kinds of ESRD life-sustaining services - dialysis and transplantation. Dialysis is a process which separates substances in the blood by taking advantage of their different diffusibility through a porous membrane by means of the artificial kidney (Dialysis station) . Transplantation is the process whereby a patient's nonfunctioning kidney is replaced surgically with a functioning kidney donated by a relative or a suitable cadaver. Hemodialysis is employed on an acute basis for hospital inpatients and on a chronic basis for those persons suffering from ESRD who must have this maintenance procedure performed usually three times per week, five hours per treatment, in order to live. Chronic hemodialysis is performed on an outpatient basis and may be rendered by home self-care or in-center treatment. In-center care is carried out in a facility where dialysis is either accomplished by the individual or with the assistance of nurses. (Exhibit 3, Testimony of Pickering) There are five chronic dialysis units in facilities located within the four-county area of the Florida Gulf Health Systems Agency, Inc. The counties are Pasco, Pinellas, Hillsborough and Manatee. Four of these facilities are located in Hillsborough County and one in Pinellas County at St. Petersburg. There is no unit in the northern part of Pinellas County to service that area and Pasco County. The total number of chronic dialysis stations at the five facilities total 91, including 18 stations at the VA Hospital in Tampa. The VA Hospital had 39 dialysis patients as of January 1, 1978, and has established a 41 patient maximum for the facility. (Exhibits 3, 4, 8, Testimony of Pickering, McKinney, Riedsiel) Thee fees for outpatient chronic dialysis for Medicare patients are established by the federal government and have been fixed at $150.00 per treatment since 1973. The sum of $12.00 of that amount is for the physician's fee. For eligible Medicare patients, the government reimburses 80 percent of the allowable charge. Ninety percent of dialysis patients are eligible for Medicare. If Petitioner's proposed unit is approved, there will be a savings to the government in travel costs and there will be greater convenience to the patients in that those in the northern Pinellas and Pasco County area are now obliged to travel either to Tampa or St. Petersburg for treatment. (Exhibit 3, Testimony of Pickering, supplemented by Composite Exhibit 5) In its application, petitioner used a standard formula to arrive at the projected need for additional dialysis stations by August 1, 1978. This was based on the actual number of patients (217) in the four-county area, excluding Veterans Administration patients, as of August 1, 1977. The estimated number of new patients in the ensuing year, based on anticipated population growth to 1.6 million, was added to this figure to arrive at a total number of patients. Different computations were made based on either 80 or 100 new patients per million population. The actual number of successful kidney transplants performed in the area during the previous year was deducted from the projected patient population, as was an estimated 20 percent mortality rate for all patients. It was further assumed that patients would use each station two shifts a day for six days a week. Based on the existing number of dialysis stations, Petitioner estimated that between 4 and 11 new stations would be required within a year, depending upon either a 90 percent or 80 percent utilization rate of stations. These figures did not include transient patients or winter visitors. (Exhibit 4) Petitioner's proposal was first considered by the Florida Gulf Health Systems Agency, Inc., a federally funded agency charged with initial review of such applications, on November 28, 1977. It found that the proposal was in conformity with standards, criteria, and plans employed by the agency under the Section 1122 review program and recommended approval of the application. This agency utilized a formula similar to that of the Petitioner and determined that there would be a net need for five additional dialysis stations in 1978 and seventeen additional stations in 1979. However, it based this estimate on a figure of 3.2 patients per station, with each station operating only at 80 percent utilization. It also used an increased projected mortality rate of 21.8 percent per year, and estimated there would be 96 new patients per million population. The agency's rationale for recommending approval of Petitioner's application for ten additional stations even though the data indicated a need for only five in 1978, was based on the exclusion of transient population from the data, the life and death nature of the service, and the time period required for phasing in of the project. (Exhibit 3, Testimony of Silver) After receipt of the recommendation of the Florida Gulf Health Systems Agency, Inc., Respondent's medical facilities consultant reviewed the application, taking into consideration the recommendations and report of that agency, together with the report of a health program specialist of the Kidney Disease Program in the Department of Health and Rehabilitative Services. The latter report used erroneous figures in its computations to arrive at a zero need for additional dialysis stations by August, 1978. In a subsequent report, using more accurate figures as to patient load for each machine and a 15 percent instead of a 20 percent projected mortality rate, a new recommendation still found no need for additional stations within the coming year. However, unrealistic population figures were used in arriving at the probable number of new patients. (Exhibits 10, 11, Testimony of McDaniel) Respondent's consultant found that Petitioner's application met all the statutory and regulatory criteria for approval except as to need for additional facilities. Using an admittedly erroneous figure as to the average number of patients per dialysis station, he determined that an excess of 11 stations would exist in 1978 and an excess of two stations in 1979. Based on the recommendation of the consultant, respondent's Administrator of the Office of Community Medical Facilities advised Petitioner by letter of December 13, 1977, that its proposal was not favorably considered for the following reasons: The finding by the Florida Gulf Health Systems Agency that only five additional ESRD stations will be needed in 1978. The determination by the Office of Community Medical Facilities that a surplus of eleven stations will exist in the Health Service area in 1978. On December 16, 1977, Petitioner filed its petition for a formal hearing to contest the denial of its application. (Exhibits 1, 2, Testimony of Sjoberg) At the hearing, both Petitioner and Respondent presented updated figures as to actual patient population on January 1, 1978, based on informal surveys of local dialysis facilities. They stipulated that 242 patients were utilizing dialysis stations in the four-county area as of that date. Both parties also basically agreed that 3.6 patients per station is realistic, as is a 20 percent mortality rate, that the projected area population by the end of 1978 will be about 1.6 million, and that an average of 96 new patients per million population could be anticipated. The number of successful kidney transplants in 1977 (12) was undisputed. It was shown that the limitations on veterans gaining access to the Tampa VA Hospital would be modified by deaths in the hospital in the amount of some eight patients. The evidence also showed that Petitioner's planned home dialysis program would take care of the needs of about 23 patients per year. In applying the above figures to the basic formula, it is found that at least 78 stations will be needed by the end of 1978. Since 73 stations are in existence at the present time, five new stations would be required in 1978 based on a projected net patient population of 282. This figure does not include occasional utilization of dialysis stations by an unknown number of transients and winter residents of the area. However, since the number of such patients is unknown, this factor cannot be used in calculating the need for facilities. Applying the standard formula, it also conservatively can be found that at least five additional dialysis stations will be required in the first half of 1979. Respondent, as a matter of unwritten policy, restricts its consideration of need to the one-year period subsequent to the filing of an application. It will take petitioner approximately three to four months to have its facility operational for the treatment of patients. In consideration of the necessary administrative approvals required prior to commencing the purchase of equipment and rental and renovation of building space, it is found that Petitioner will not be in a position to operate its proposed facility until the latter half of 1978. (Exhibits 3, 6, 7, 12, 13, Testimony of McKinney, Sjoberg, Riedsiel, Shires)
Recommendation It is recommended that the petitioner's application for Certificate of Need/Capital Expenditure Proposal be approved. Done and Entered this 14th day of February, 1978, in Tallahassee, Florida. THOMAS C. OLDHAM Hearing Officer Division of Administrative Hearings 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Mr. Art Forehand Administrator Office of Community Medical Facilities 1323 Winewood Boulevard Tallahassee, Florida 32301 Eric Haugdahl, Esquire Staff Attorney, Department of HRS 1323 Winewood Boulevard Tallahassee, Florida 32301 John H. French, Jr., Esquire 630 Lewis State Bank Building Tallahassee, Florida 32301 Gary Silvers Director of Project Review Florida Gulf Health Systems Agency, Inc. 10051 Fifth Street North Suite 253 St. Petersburg, Florida Mark B. Cohn, Esquire Post Office Box 1102 Tampa, Florida 33601
