The Issue The issue for determination is whether Respondent committed the offenses set forth in the Administrative Complaint and, if so, what action should be taken.
Findings Of Fact At all times material hereto, Bret L. Lusskin (Respondent) was a licensed physician in the State of Florida, having been issued license number ME 0007919. Respondent has been practicing medicine in Florida for approximately 33 years. Respondent is board-certified in orthopedic surgery. On January 8, 1992, the Department of Professional Regulation, Board of Medicine (Board of Medicine) filed a Final Order of disciplinary action against Respondent in DOAH Case No. 90-1565, DPR Case Nos. 89-07389, 89-011684, and 89- 011856. By the Final Order, the Board of Medicine reprimanded Respondent's license and further ordered the following: Within 60 days, Respondent must be evaluated by a psychiatrist approved by the Physician's Recovery Network and must comply with all recommendations of said psychiatrist including entering into and complying with a contract with the Physician's Recovery Network, if applicable. Respondent shall not examine or treat any female patients without a female employee who is a health care professional licensed by the Department of Professional Regulation present in the room. Respondent must complete the continuing medical education course offered by the University of South Florida and the Florida Medical Association entitled, "Protecting Your Medical Practice: Clinical, Legal, and Ethical Issues in Prescribing Abusable Drugs," or an equivalent course approved by the Board. Respondent appealed the Board of Medicine's Final Order to Florida's Fourth District Court of Appeal, Case No. 92-0251. The appellate court filed its decision, which was "Per Curiam Affirmed," on December 9, 1992, and issued its Mandate on February 26, 1993. On April 7, 1993, the Board of Medicine filed a Final Order of disciplinary action against Respondent in DPR Case Nos. 90-03022 and 92-03622, in which Administrative Complaints were filed against Respondent. One of the Administrative Complaints, Case No. 92-03622, filed on July 13, 1992, was based upon Respondent's failure to present himself for evaluation by a psychiatrist approved by the Physician's Recovery Network (PRN) within 60 days of the Board of Medicine's Final Order filed on January 8, 1992. The Final Order in DPR Case Nos. 90-03022 and 92-03622 approved a consent agreement involving the cases. The consent agreement provided, among other things, that Respondent neither admitted nor denied the allegations of fact in the Administrative Complaints, that Case No. 92-03622 be dismissed, that Respondent be reprimanded, and that an administrative fine of $2,000 be imposed. On January 29, 1993, following the appellate decision, a psychiatric evaluation of Respondent was performed at the University of Florida, College of Medicine in Gainesville, Florida, by Dr. George W. Barnard, M.D., a psychiatrist, and Dr. Michael J. Herkov, Ph.D. Dr. Barnard was a professor and Director of the Forensic Psychiatry Division at the University, and Dr. Herkov was an assistant professor at the University. Dr. Barnard was approved by PRN. Among other things, Drs. Barnard and Herkov administered several psychological tests to Respondent. The tests were the Minnesota Multiphastic Personality Disorder (MMPI), Million Clinical Multiaxial Inventory (MCMI), and the Rorschach Inkblot Test. Drs. Barnard and Herkov opined, among other things, that Respondent suffers from a "dysthymic condition" and from "characterological problems that play a considerable role in his [Respondent's] behavior." Further, Drs. Barnard and Herkov opined that Respondent denies any responsibility for his inappropriate conduct, instead blaming his patients, and that such denial places Respondent "at serious risk to continue to engage in these inappropriate behaviors." Drs. Banard and Herkov made several recommendations. Concerned with the "intransigence of [the] characterological traits and the strength and pervasiveness of his [Respondent's] current denial," Drs. Banard and Herkov recommended, among other things, that Respondent participate in a structured and intensive inpatient psychotherapy treatment program, specializing in sex offenders; that, after the inpatient treatment, Respondent receive long-term psychotherapy in his local community with a therapist trained in dealing with sexual offenders, noting that prior outpatient psychotherapy had been ineffective; that periodic reports be made to the PRN; that Respondent become a member of the local Caduceus Group; and that Respondent continue the practice of always having a female assistant present when examining a female patient. Furthermore, Drs. Banard and Herkov stated that Respondent's "motivation for change appears to be poor, and any intervention program hinges to a great extent on patient [Respondent] willingness to change" and that Respondent "may have to be faced with dire consequences before he possesses the necessary motivation to participate in such a program." Respondent desired a second opinion. On April 9, 1993, a second psychiatric evaluation of Respondent was performed at the University of South Florida, Tampa, Florida, by Dr. Anthony Reading, M.D., a psychiatrist, and Dr. Irving B. Weiner, Ph.D. Dr. Reading was the Chairperson of and a professor at the Department of Psychiatry and Behavioral Medicine at the University. Making no specific diagnosis, Dr. Reading opined, among other things, in the evaluation that Respondent does not represent an ongoing danger to female patients through inappropriate sexual behavior and that Respondent has a number of emotionally constricted personality attributes which are under control. Dr. Reading recommended, among other things, that the requirement of having a female professional present during Respondent's examination of female patients be continued and that Respondent receive outpatient psychiatric treatment, conducted by a PRN-approved individual who is trained in the therapy particularly associated with Respondent's problems and who has no prior social or professional relationship with Respondent. A copy of Dr. Reading's evaluation was forwarded to the PRN. A review of the evaluations by Drs. Banard and Reading was conducted by Dr. Raymond Pomm for the PRN. Dr. Pomm was a PRN staff psychiatrist who renders opinions to PRN's director, Dr. Roger Goetz, regarding psychiatric, chemical dependency and boundary violation cases. Based on Dr. Pomm's review, PRN took the position that Dr. Reading's evaluation was based on incomplete information and was, therefore, invalid. Wanting to obtain an independent review, PRN forwarded a copy of the two evaluations performed by Drs. Banard and Reading to Dr. James Edgar, a psychiatrist at the South Tampa Medical Center, Tampa, Florida, for his review. Having reviewed the evaluations, Dr. Edgar reached several conclusions and notified PRN of his conclusions by letter dated May 5, 1993.2 Dr. Edgar concluded that Respondent suffers from "a characterological disorder characterized by narcissistic traits of self-centeredness and relative callousness to the needs of others, denial of personal responsibility for his action and a preference for getting his own needs met without much regard for the needs of others." Dr. Edgar determined that Respondent's prognosis was "extremely guarded if not poor" and that Respondent "shows no evidence of motivation for treatment." Further, Dr. Edgar concluded that Respondent had misrepresented himself to Dr. Reading and that Respondent was a "significant risk" to patients. Moreover, Dr. Edgar concluded that, if Respondent was to be allowed to continue his practice under the auspices of the PRN, Respondent should be participating in a "well structured treatment plan." Dr. Edgar provided specifics regarding the treatment plan, including an autonomous female attendant, inpatient treatment and, after the inpatient treatment, outpatient psychotherapy. Also, Dr. Edgar indicated that he was "pessimistic" that the inpatient treatment would have any significant impact on Respondent's personality structure. Dr. Edgar's report was presented to the PRN. After reviewing the evaluations and Dr. Edgar's report, PRN required Respondent to present himself for admission for inpatient therapy and provided Respondent with a choice of facilities for the therapy. The Menninger Clinic at the C.F. Menninger Memorial Hospital in Topeka, Kansas, was chosen. It was agreed by Respondent and PRN that they would abide by the recommendations made by The Menninger Clinic. On or about May 3, 1993, Respondent presented himself to The Menninger Clinic for evaluation by Dr. Donald E. Rosen, M.D., Director of the Professionals in Crisis Program at The Menninger Clinic, and by Dr. Rosen's staff. However, inpatient admission did not occur. In his report, Dr. Rosen stated, among other things, that Respondent "clearly did not desire inpatient treatment (or treatment in general)"; that Respondent, during the initial interview, "denied the presence of any psychiatric symptoms, psychological conflicts, or presence of any treatment goals that he would hope to accomplish in a treatment process"; and that Respondent was openly cautious and withheld some information, with his withholding being "overt and in other ways, more subtle." Dr. Rosen was, therefore, unable to make any specific recommendation, stating, among other things, that "no specific recommendations for ongoing psychiatric treatment are made at this time." Further, in his report Dr. Rosen addressed the situation of a female attendant being present during Respondent's treatment and examination of female patients. Dr. Rosen was concerned with Respondent's manipulative behavior and stated that, considering Respondent's "long-standing history of sexual relations with his patients, his lack of guilt about these relationships, his inability to see this behavior as a personal ethical issue, and the overt manipulativeness that surrounded this evaluation," he could not "state with confidence that the patient [Respondent] will not attempt to make his employees allow him to see female patients without a female healthcare professional in the room at all times." It is undisputed that Dr. Rosen did not make any recommendations. By letter dated May 6, 1993, to Respondent and written at Respondent's request, Dr. Rosen confirmed that Respondent presented himself for inpatient admission but was not admitted. Furthermore, Dr. Rosen stated the reasons for Respondent not being admitted, which were because Respondent "denied the presence of any psychiatric symptoms, denied any psychological problems you [Respondent] wished to work on, and had no goals for what you [Respondent] hoped treatment would accomplish." These reasons were the same reasons expressed in Dr. Rosen's report. Inpatient treatment could not be accomplished, if Respondent refused to admit that he had psychological problems and that he needed to work on his psychological problems, and to establish goals for what he hoped the treatment would accomplish. By certified letter dated August 3, 1993, to Respondent, PRN confirmed its request made May 26, 1993, that Respondent not practice medicine until he completed inpatient treatment. Furthermore, in the letter PRN notified Respondent that, before he could return to the practice of medicine, his treating psychiatrist must confirm that he is able to return to the practice of medicine with reasonable safety to the public. By letter dated February 10, 1994, to the then Department of Business and Professional Regulation (Department), PRN notified the Department that Respondent was in violation of the Board of Medicine's Final Order filed January 8, 1992. PRN recapped, among other things, the evaluations performed, including the evaluation at The Menninger Clinic, and the results of the evaluations. Furthermore, PRN advised the Department of the request PRN made to Respondent in May 1993 that Respondent refrain from practicing medicine until he had undergone inpatient treatment at The Menninger Clinic and the same request it had made in August 1993. PRN concluded, among other things, that Respondent had violated the Final Order; that it (PRN) was unable to monitor Respondent, as to refraining from practicing medicine; that Respondent continued to need inpatient therapy at The Menninger Clinic; and that Respondent presented a danger to the public health, safety, and welfare. On July 20, 1994, Dr. Burton Cahn, M.D., a psychiatrist, wrote a letter addressed to "To Whom It May Concern," stating that Respondent "does not represent either a danger to himself or to others." Prior to writing the letter, Respondent was Dr. Cahn's patient from November 1989 through 1991. Dr. Cahn never conducted any diagnostic tests, such as the MMPI, on Respondent. Also, Dr. Cahn is a personal friend of Respondent. By letter dated September 6, 1994, the Compliance Officer for the Board of Medicine notified Respondent that he had complied with all of the requirements of the Final Order dated January 8, 1992. The letter further reminded Respondent of the restriction that a licensed female healthcare professional was required to be present when he treated or examined female patients. However, the Compliance Officer issued the letter in error. She had failed to communicate with the PRN, prior to issuing the letter, to determine whether Respondent had completed the requirements as to the PRN, such as being evaluated by a PRN- approved psychiatrist and complying with the recommendations of the psychiatrist. If the Compliance Officer had communicated with the PRN, she would have been informed by PRN that Respondent had not completed its requirements. Further, legal counsel with the Agency for Health Care Administration (AHCA)3 informed PRN that Respondent was under no obligation to comply with PRN's request of May 1993 and August 1993 to refrain from practicing medicine until he undergoes inpatient treatment at The Menninger Clinic. Moreover, the legal counsel further informed PRN that Respondent was only required to comply with the recommendations of the psychiatrist. By letter dated November 1, 1995, to the legal counsel of AHCA, the PRN again expressed, among other things, its concern that Respondent was capable of manipulating his staff when treating or examining a female patient. The PRN advised the legal counsel that it considered Respondent's impairment to affect his ability to practice medicine and that his impairment "constitutes an immediate, serious danger to the public health, safety and welfare." Subsequently, on February 22, 1996, the Administrative Complaint in the present case was filed by the Petitioner. At that time, the prevailing opinion amongst all of the PRN-approved psychiatrists, except for Dr. Rosen, was that Respondent was suffering from a psychological illness. Moreover, the prevailing opinion amongst all of the PRN-approved psychiatrists, except for Dr. Rosen, was that inpatient therapy was required. Dr. Rosen was unable to make any diagnosis or recommendations. Even though Respondent presented himself for inpatient admission, he was not admitted due to his denial that he had a psychological illness that required therapy; without Respondent admitting that he had a psychological problem, no treatment could be effectuated. Without treatment, Respondent remained ill; he suffered from a psychological illness. Without treatment, Respondent was a danger to his female patients and was unable to practice medicine with reasonable skill and safety to his patients by reason of illness.4 After the filing of the Administrative Complaint in the present case, the parties agreed that Respondent would be evaluated by a psychiatrist acceptable to the PRN. After consideration, including the location of Respondent's practice, which was on the East Coast, and Respondent's wish for a psychiatrist on the East Coast to conduct the evaluation, Dr. Ronald Shellow, a psychiatrist in Miami, was recommended by PRN, but PRN also indicated that Dr. Shellow was not an expert in the behavioral disorder with which Respondent had been diagnosed by other PRN approved psychiatrists. On August 7, 14, and 23, 1996, Dr. Shellow conducted an evaluation of Respondent, with each session lasting one hour. Dr. Shellow administered the Bender-Gestalt and the House-Tree- Person psychological tests. In his report dated September 2, 1996, Dr. Shellow states, among other things, that Respondent related to him the incident involving the female patient, on which the Administrative Complaint in the present case was filed, but that Respondent "would not say whether this had happened with other patients." Clearly, Respondent was not being forthright with Dr. Shellow because, prior to this incident, other incidents involving female patients had occurred. This additional information was not available to Dr. Shellow for his consideration in his evaluation. Again, Respondent was withholding information. In his evaluation, Dr. Shellow opined, among other things, that Respondent was not suffering from a psychiatric disturbance and that Respondent had no psychiatric disorder; however, based on Respondent's history, Dr. Shellow Respondent did have a dependent personality disorder. Dr. Shellow concluded, among other things, that the reoccurrence of the incident with another female patient was "unlikely" as long as Respondent's marriage remained "satisfying" and he continued to "see his psychiatrist on a quarterly basis." Dr. Shellow indicated that Respondent's present psychiatrist, Dr. Cahn, concurred with him. Subsequently, Dr. Shellow received a copy of the evaluation conducted by The Menninger Clinic from Dr. Cahn. Having reviewed The Menninger Clinic's evaluation, which revealed past encounters by Respondent with his female patients, by letter dated November 14, 1996, to Dr. Pomm of the PRN, Dr. Shellow notified PRN that his opinion had not changed. Dr. Cahn had begun treating Respondent again in 1995. His opinion remained, and remains, unchanged. Dr. Cahn is of the opinion that, even though Respondent was suffering from a personality disorder when he first began treating Respondent in 1989, Respondent no longer suffers from a psychological illness and, therefore, requires no psychiatric treatment.5 Dr. Cahn agrees that a personality disorder is a psychological illness. Considering the proof, the opinions of Dr. Cahn are less than persuasive, and it is concluded that Respondent continues to suffer from a psychological illness.6 Furthermore, Dr. Shellow expressed in his letter dated November 14, 1996, that he was of the opinion that Respondent could practice medicine with skill and safety under certain conditions. Dr. Shellow stated that if Respondent "is to continue practicing medicine with skill and safety, he should be in psychotherapy on some sort of sontinuing [sic] basis, and he should be supervised to prevent these actions from occurring again." Regarding the monitoring of Respondent's practice, Dr. Shellow was of the opinion that any monitoring should be devised and decided upon by the PRN and that, with Respondent being in his 60's, Respondent should enter into a contract with the PRN for as long as he practices medicine. Also, Dr. Shellow opined that some way should be developed to use Respondent's skills, but that, if Respondent prevented anyone in his office from reporting to the PRN, Respondent was not practicing medicine with skill and safety. At no time did Dr. Shellow receive or review the evaluations of Drs. Banard, Reading or Edgar. On December 2, 1996, AHCA filed an Order of Emergency Restriction of License against Respondent. His medical practice was restricted as to his treating or examining female patients, monitoring by PRN, and entering into a contract with PRN. On December 30, 1996, Respondent executed an advocacy contract with PRN. In the contract, Respondent designated, among other things, Dr. Cahn as his treating psychiatrist, with whom he would have quarterly psychiatric treatment meetings; Dr. Michael Langone, M.D., as his supervising practitioner; and Gretchen Nelson, a registered nurse, as the female chaperon during his treatment or examination of female patients. Dr. Cahn is known to the PRN. He has been a referral psychiatrist for PRN for several years. Nowhere on the advocacy contract was there a provision to identify the relationship of the supervising practitioner and the chaperon to the physician who is being monitored. Dr. Langone was an associate and employee of Respondent. Nurse Nelson was an employee of Respondent. On January 16, 1997, PRN executed the advocacy contract. By letter dated February 4, 1997, PRN notified the legal counsel for AHCA that an advocacy contract had been entered into between it and Respondent. In March 1997, PRN experienced a problem as to the female chaperon, Nurse Nelson. The PRN telephoned Respondent's office to confer with Nurse Nelson. Upon speaking with Nurse Nelson, among other things, PRN learned that she was not aware of her responsibility as the female chaperon to the advocacy contract and that she was employed by Respondent. By letter dated March 24, 1997, PRN notified Respondent that it had contacted his office several times and had problems contacting the individuals indicated in the advocacy contract; that the contract needed to be reviewed with the individuals; and that the individuals would be receiving random monitoring telephone calls from PRN to access compliance with the contract. Further, PRN notified Respondent that copies of the contract mailed to the female chaperon and the office staff person designated to handout and collect the Patient Survey Form were returned, and PRN requested that Respondent make sure that the individuals receive copies of the contract. After discovering that Respondent had designated an associate and employee as the supervising practitioner, PRN was concerned that Dr. Langone may have a conflict of interest. Also, PRN discovered that Dr. Langone was leaving Respondent's practice. PRN decided to no longer approve Dr. Langone as the supervising practitioner. By letter dated June 2, 1997, PRN notified the legal counsel for AHCA that PRN had attempted to monitor Respondent's practice without success and that Respondent was currently not being monitored by PRN. Furthermore, PRN stated that Respondent, in its opinion, continued to require monitoring by it. Respondent has not been charged with a violation of the advocacy contract. PRN has not notified the Petitioner that Respondent was not in compliance with the contract. Neither Dr. Cahn nor any individual designated in the contract has notified the PRN that Respondent was not in compliance with the contract. Dr. Cahn, Respondent's approved treating psychiatrist, is of the opinion that by having a licensed female professional present when Respondent examines or treats a female patient, Respondent can practice medicine with reasonable skill and safety. Dr. Pomm of PRN is of the opinion that, with a monitoring contract in place and compliance with the contract, Respondent can practice medicine with reasonable skill and safety. However, Dr. Pomm is also guarded as to the success of any future contract due to Respondent's history of manipulation and personality disorder.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Board of Medicine enter a final order: Finding that Respondent violated Subsection 458.331(1)(s), Florida Statutes, in Count II of the Administrative Complaint. Dismissing Count I of the Administrative Complaint. Suspending Respondent's license until he is able to demonstrate that he is able to practice medicine with reasonable skill and safety. Placing Respondent on probation, under terms and conditions deemed appropriate by the Board of Medicine, for five years following the removal of the suspension. Imposing an administrative fine of $2,500. DONE AND ENTERED this 6th day of March, 1998, in Tallahassee, Leon County, Florida. ERROL H. POWELL 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 Filed with the Clerk of the Division of Administrative Hearings this 6th day of March, 1998.
Findings Of Fact Edward Amsbury, Petitioner, is a Career Service employee with permanent status. The Petitioner timely filed an appeal of the Respondent's actions as set forth above. According to Petitioner, he applied for several jobs under the reorganization of the Department of Health and Rehabilitative Services (HRS) prior to July of 1976. At that time he was advised that inasmuch as he was not an adversely affected employee, he would only be considered after all adversely affected employees were placed in other positions. On July 9, 1976, a letter was sent by George Van Staden, ASO, by Larry Overton to the District Administrator advising that Petitioner was originally to have been adversely affected and he (Van Staden) asked for justification as to why Petitioner's position was continued in the District III personnel structure. Thereafter, on approximately July 22, 1976, according to Petitioner, Richard Dillard, Sub- district III-A Administrator, orally advised him that his position would be abolished prior to January 1, 1977, due to HRS' reorganization. A few days later, Petitioner was advised by Mr. Dillard that his position as Mental Health Representative was being reclassified to that of the Community Resources Development Unit Supervisor as of October 1, 1976, and that the pay grade would be 18 rather than his then existing pay grade, 19. Petitioner was asked to write a new job description for the Community Resources Development Supervisor, at which time he was offered that position. Petitioner was then at the top of Pay Grade 18; however, he was advised by Mr. Dillard that his salary would not be reduced since he, in effect, was adversely affected due to reorganization. In view of the lateness with which the Petitioner was advised that his position was adversely affected, there were then only two positions available within the district, i.e., Community Resources Development Unit Supervisor or Clinical Social Worker II at the North Florida Evaluation and Treatment Center. Petitioner chose the position more closely related to his field of Mental Health, i.e., the Community Resources Development Unit Supervisor, and was told by Mr. Dillard that he would retain his present salary regardless of which position he accepted. All the Petitioner's performance evaluations were satisfactory or above. Based on the record, it appears that the Petitioner was forced to accept a position with a lower pay grade due to HRS' reorganization. By letter dated July 1, 1977, the Petitioner was advised by William H. McClure, Jr., District Administrator, that the Department of Administration had disapproved the District Administrator's request that he (Petitioner) maintain his current salary above the maximum for the class of Clinical Social Worker II, to which he was demoted on September 17, 1976. Correspondence from Conley Kennison, State Personnel Director, reveals that determination was based on the following reasons: Petitioner's voluntary demotion was not directly attributable to reorganization since the position of Mental Health Representative continued in existence until July 1, 1977; He retained his bi-weekly salary of $584.76 upon demotion without approval of the State Personnel Director; and Petitioner was not informed in writing the Mental Health Representative position would be adversely affected, by reorganization. As a result thereof, the Department of Administration contended that it overpaid the Petitioner the amount of $11.16 per bi-weekly pay period and that in accordance with provisions of Chapter 22K-10.04(2) of the Personnel Rules and Regulations, such amount must be recovered and to effect such, said amount would be deducted from each salary warrant for a period of twenty-one pay periods to cover the overpayment from September 17, 1976, through July 7, 1977. Additionally, effective July 8, 1977, Petitioner's salary was reduced to the maximum for Pay Grade 18, i.e., $573.60 bi-weekly. The letter of July 1, 1977, further advised the Petitioner that although he was originally designated adversely affected along with all the other Mental Health Representative positions, positions which were to be abolished on July 1, 1976, the District Administrator was later told that Petitioner's position would not be abolished until January of 1977. Petitioner, as stated in said letter, took his demotion in good faith, feeling that his position of Mental Health Representative would be abolished. On November 17, 1976, the District Administrator forwarded a request to the Department of Administration requesting that Petitioner's salary be maintained; however, no action was taken because no administrative disposition bad been taken with respect to the abolishment of that position. A further request was sent to the Department of Administration in April, and during June of 1977 the request was denied and efforts to recover the overpayment were implemented. Evidence contained in the case files revealed that several employees who were voluntarily demoted pursuant to reorganization were granted permission to maintain their current salaries which amounted to payments above the maximum for the class to which they were demoted. The Respondent offered no evidence to refute or otherwise contradict the statements and contentions of the Petitioner that he was advised by district representatives and personnel that his salary would be maintained even though he was being demoted due to reorganization. It further appears that the Respondent, in relying on statements by the District Administrator (Dillard), was hampered in his efforts to obtain favorable consideration for other positions which were up for bid during the reorganization process. Noteworthy is the uncontradicted statement that the Petitioner was told that inasmuch as he would not be adversely affected by reorganization, he would not be considered for positions until all adversely affected employees had been placed in positions which were open for bid during reorganization. A memorandum from Art Adams of the HRS Personnel Office to John Campbell, Personnel Officer for District IV, dated August 9, 1976, advised that all employees who were asked to take a demotion due to reorganization would retain their salaries over the maximum. For all of the above reasons, including the indefensible position advanced by the Respondent, I shall recommend that the Respondent's action in reducing the Petitioner's pay and seeking to recover amounts allegedly overpaid be reversed.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is hereby RECOMMENDED: The Petitioner's salary be reinstated to the level to which he was receiving as of the date of demotion on or about September 17, 1976. That the Respondent make whole any loss of pay the Petitioner suffered as a result of the reduction in his salary and the bi-weekly deductions of $11.16. That the Petitioner be paid interest at the rate of 6 percent per annum based on the amounts withdrawn from his salary warrants through the deductions and the recovery of amounts allegedly overpaid him when his salary was reduced. RECOMMENDED this 27th day of July, 1978, in Tallahassee, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of July, 1978. COPIES FURNISHED: Mr. Edward Amsbury 5620 Northwest 25th Terrace Gainesville, Florida 32601 Mrs. Dorothy B. Roberts Career Service Commission 443 Carlton Building Tallahassee, Florida 32304 Joseph E. Hodges, Esquire 2002 Northwest 13th Street 3rd Floor, Oak Park Executive Square Gainesville, Florida 32601 Thomas K. McKee, Jr., Esquire Post Office Box NFETC Gainesville, Florida 32602 =================================================================
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found: In November of 1983, HMA filed its application for a Certificate of Need to construct and operate a 60-bed adolescent treatment center in Orlando, Florida. An omissions response was filed by HMA in January of 1984. Thereafter, HRS issued its initial intent to grant the application and PIO requested an administrative hearing. HMA is a privately held corporation which owns or manages twelve or thirteen acute care hospitals in the States of Kentucky, West Virginia, Pennsylvania, Missouri, Texas and Florida, several of which are psychiatric hospitals. The proposed long-term psychiatric treatment facility for adolescents is patterned after a 55-bed program currently operated by HMA in Arlington, Texas. The proposed facility will be a freestanding campus-like setting located on ten to fifteen acres of land in the southern portion of Orlando. The precise site has not yet been selected. The single-story facility will have a total size of approximately 45,000 to 50,000 square feet and will be divided into two separate units which connect into a core area containing various support services, such as offices, a gymnasium, a swimming pool, a media center, and an occupational therapy area. While the location finally selected for the facility will have a bearing on the site costs of the project, the estimated construction costs of approximately 3.1 billion do contain a contingency factor and are reasonable at this stage of the project. Each unit will be served by two interdisciplinary treatment teams headed by a physician or a psychiatrist. Key personnel for the facility, such as department heads and program directors, will most likely be recruited from outside the Orlando area in order to obtain persons with experience in long-term care for adolescents. The treatment program is designed to serve adolescents between the ages of 10 and 19, though the bulk of patients will be middle school and high school individuals between the ages of 13 and 17. While the primary service area will be adolescents in District 7, the remainder of the central Florida region is identified as a secondary service area. A full educational program at the facility is proposed. The concept of the hospital will be to treat the whole person, not just his psychiatric problems, and the treatment program will include and involve family members and other factors which may have a bearing on the adolescent's ability to fit into society. The form of treatment is based upon a "levels" approach -- a form of behavior modification wherein privileges are granted for appropriate behavior and the patient is allowed to move up to the next succeeding level of privileges. It is contemplated that the average length of stay for a patient will be approximately six months -- the average time anticipated for a patient to move from the admission level to the level of discharge. HMA intends to seek accreditation of its proposed facility from the Joint Commission on Accreditation of Hospitals. The total estimated project cost for the proposed facility is $6,307,310.00. Financing is to be obtained either through a local bond issue or by a private lending institution. Based upon an evaluation of HMA's audit reports for the past three years, an expert in bond financing of health care facilities was of the opinion that HMA would be eligible either for a private placement or a bond issue to finance the proposed project. HMA intends to charge patients $325.00 per day, and projects an occupancy rate of 80 percent at the end of its second year of operation. This projection is based upon a lack of similar long-term psychiatric facilities for adolescents in the area, the anticipated, experience at the Arlington, Texas adolescent facility and the anticipated serving of clients from CYF (Children Youth and Families -- a state program which; serves adolescents with psychiatric and mental problems). Although no established indigent care policy is now in existence, HMA estimates that its indigency caseload will be between 3 and 5 percent. It is anticipated that the proposed facility will become a contract provider for CYF for the care and treatment of their clients and that this will comprise 20 percent of HMA's patient population. HRS's Rule 10-5.11(26), Florida Administrative Code, relating to long- term psychiatric beds, does not specify a numerical methodology for quantifying bed need. However, the Graduate Medical Education National Advisory Committee (GMFNAC) methodology for determining the need for these beds is generally accepted among health care planners. The GMENAC study was initially performed in order to assess the need for psychiatrists in the year 1990. It is a "needs- based" methodology, as opposed to a "demand-based" methodology, and attempts to predict the number of patients who will theoretically need a particular service, as opposed to the number who will actually utilize or demand such a service. Particularly with child and adolescent individuals who may need psychiatric hospitalization, there are many reasons why they will not seek or obtain such care. Barriers which prevent individuals from seeking psychiatric care include social stigma, the cost of care, concerns about the effectiveness of care, the availability of services and facilities and other problems within the family. Thus, some form of "demand adjustment" is necessary to compensate for the GMENAC formula's overstatement of the need for beds. The GMENAC formula calculates gross bed need by utilizing the following factors: a specific geographic area's population base for a given age group, a prevalency rate in certain diagnostic categories, an appropriate length of stay and an appropriate occupancy factor. In reaching their conclusions regarding the number of long-term adolescent psychiatric beds needed in District 7, the experts presented by HMA and PIO each utilized the GMENAC formula and each utilized the same prevalency rate for that component of the formula. Each appropriately used a five-year planning horizon. However, each expert reached a different result due to a different opinion as to the appropriate age group to be considered, the appropriate length of stay, the appropriate occupancy factor and the factoring in of a "demand adjustment." In calculating the long-term adolescent psychiatric bed need for District 7 in the year 1989, HMA's expert used a population base of ages 0 to 17, lengths of stay of 150 and 180 days, an occupancy level of 80 percent and an admissions factor of 96 percent. Utilizing those figures, the calculation demonstrates a 1989 need for 158 beds if the average length of stay is 150 days, and 189 beds if the average length of stay is 180 days. If the population base is limited to the 10 to 19 age bracket, the need for long-term psychiatric beds is reduced to between 70 and 90, depending upon the length of stay. From these calculations, HMA's expert concludes that there is a significant unmet need for long-term adolescent psychiatric beds in District 7. This expert recognizes that the numbers derived from the GMENAC formula simply depict a statistical representation or indication of need. In order to derive a more exact number of beds which will actually be utilized in an area, one would wish to consider historical utilization in the area and/or perform community surveys and examine other site-specific needs assessment data. Believing that no similar services or facilities exist in the area, HMA's need expert concluded that there is a need for a 60-bed facility in District 7. In applying the GMENAC methodology, PIO's need expert felt it appropriate to utilize a base population of ages 10 through 17, an average length of stay of 90 days and an occupancy rate of 90 percent. Her calculations resulted in a bed need of 37 for the year 1990. Utilizing a length of stay of 120, 150 and 180 days and a 90 percent occupancy rate, a need of 50, 62 and 75 beds is derived. If an occupancy rate of 80 percent is utilized, as well as a population of ages 10 - 17, the need for beds is 42, 56, 70 and 84, respectively, for a 90, 120, 150 and 180 day average length of stay. The need expert for PIO would adjust each of these bed need numbers by 50 percent in order to account for the barriers which affect the actual demand for such beds. Since the HMA proposed facility intends to provide service only to those patients between the ages of 10 and 19, use of the 0 - 17 population would inflate the need for long-term adolescent psychiatric beds. Likewise, PIO's non-inclusion of 18 and 19 year olds understates the need. PIO's use of a 90-day average length of stay would tend to understate the actual need in light of HMA's proposed treatment program which is intended to last approximately six months. While some demand adjustment is required to properly reflect the barriers which exist to the seeking of long-term adolescent psychiatric care, the rationale of reducing by one-half the number derived from the GMENAC methodology was not sufficiently supported or justified. Even if HMA's calculations were reduced by one-half, a figure of between 79 and 94 beds would be derived. The existence of other long-term adolescent psychiatric beds in District 7 was the subject of conflicting evidence. West Lake Hospital in Longwood, Seminole County, holds a Certificate of Need and a license as a special Psychiatric hospital with 80 long-term beds. However, the Certificate of Need was issued prior to the adoption of Rules 10-5.11(25) and (26), Florida Administrative Code, when anything in excess of 28-days was considered long- term. The West Lake application for a Certificate of Need referred to a four- to-six week length of stay -- or a 28 to 42 day period --for adults, and a ten week, or 70 day length of stay for children and adolescents. In preparing inventories for planning purposes, HRS considers the 40 child and adolescent psychiatric beds at West Lake Hospital to be acute or short-term beds. The West Lake facility is not included in HRS's official inventory of licensed and approved long-term care beds as of October 1, 1984. In fact, the only long-term care beds listed for District 7, in addition to HMA's proposed psychiatric facility, are beds devoted to the treatment of substance abuse. PI0 is the holder of a Certificate of Need to construct and operate a 60-bed short-term adolescent psychiatric hospital in Southwest Orange County, and is currently planning the actual development and construction of the facility. If PIO is not able to reach the census projections contained in its Certificate of Need application, its ability to generate earnings could be adversely impacted. Even a five percent decrease in PIO's census projections would require PIO to either raise its rates or make reductions in direct costs. This could include a decrease in staffing, thus affecting a reduction in the available programs, problems in attracting quality staff and ultimately a reduction in the quality of care offered at the PIO facility. In a batch subsequent to the HMA application, PIO requested the addition of 15 long-term adolescent psychiatric beds and 15 substance abuse beds. When an adolescent psychiatric patient is evaluated for placement in a hospital setting, it is generally not possible to determine how long that patient will require hospitalization. The adolescent psychiatric patient is often very guarded, distrusting both parents and other adults, and it is difficult to obtain full and necessary information from both the patient and the parents. Several weeks of both observation and the gathering of data, such as school records, are necessary in order to access the adolescent patient's degree of disturbance. With respect to treatment programs, there is no sharp medical demarcation between a 60-day period and a 90 day period. Patients in short-term facilities often stay longer than 60 days and patients in long term facilities often stay less than 90 days. The length of stay is very often determined by the parents, in spite of the treatment period prescribed by the physician. The treatment programs in both short-term and long-term psychiatric facilities are very similar, and short- and long-term patients are often treated in the same unit. Staffing for the two types of facilities would be basically the same, with the exception, perhaps, of the educational staff.
Recommendation Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that HMA grant HMA's application for a Certificate of Need to construct and operate a 60-bed long-term adolescent psychiatric facility in Orlando, Florida. Respectfully submitted and entered this 9th day of July, 1985, in Tallahassee, Florida. DIANE D. TREMOR, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of July, 1985. COPIES FURNISHED: C. Gary Williams and Michael J. Glazer P. O. Box 391 Tallahassee, Florida 32302 John M. Carlson Assistant General Counsel 1323 Winewood Blvd. Building One, Suite 407 Tallahassee, Florida 32301 Robert S. Cohen O. Box 669 Tallahassee, Florida 32301 David Pingree Secretary Department of Health and Rehabilitative Services 1323 Winewood Blvd. Tallahassee, Florida 32301 =================================================================
Findings Of Fact Procedural History On August 15, 1983, the Manatee Mental Health Center, Inc., d/b/a Manatee Crisis Center applied to the Department of Health and Rehabilitative Services for a certificate of need number 2681 to operate 42 short term psychiatric hospital beds and 12 short term substance abuse hospital beds. The application was denied in free form action by SIRS on January 30, 1984, and on February 23, 1984, MMHC timely requested a formal administrative hearing. On April 16, 1984, Charter Medical-Southeast, Inc., d/b/a Charter Haven Hospital petitioned to intervene in this case. The petition was granted May 7, 1984. On October 17, 1985, Manatee Memorial Hospital petitioned to intervene. The petition was granted December 5, 1985. On March 28, 1986, Charter Medical- Southeast, Inc., d/b/a Charter Hospital of Tampa Bay petitioned to intervene, and the petition was granted by order dated April 11, 1986. On March 18, 1986, MMH moved to dismiss Charter Haven as a party. On April 2, 1986 and April 16, 1986, Charter Haven filed amended petitions to intervene. The amended petitions sought comparative review as well, and consolidation. On May 5, 1986, the final hearing in this case commenced. The first portion of the hearing was directed to the issue of Charter Haven's petition to intervene and to consolidate for purposes of comparative review. On May 7, 1986, the motions of MMHC and MMH to dismiss Charter Haven granted, and this was confirmed by findings of fact and conclusions of law entered in an order dated May 14, 1986. The final hearing was continued to July 7, 1986. All portions of the order of May 14, 1986, including the findings of fact and conclusions of law, are herein by reference, and a copy of that order is attached to this recommended order as Appendix B. Additionally, all testimony and evidence received since the commencement of the final hearing of May 5, 1986, are a part of the record in this case. Description of MMHC The Petitioner, MMHC, is a private not-for-profit corporation which contracts with HRS to provide community mental health services pursuant toChapter 394, Florida Statutes. As a community mental health facility, it also provides alcohol programs pursuant to Chapter 395, Florida Statutes, and drug abuse treatment programs pursuant to Chapter 396, Florida Statutes. I-2, 47, 51. As a community mental health center, MMHC is required to provide and does provide a wide variety of inpatient and outpatient services dealing with mental health and substance abuse. Among the services provided by MMHC are outpatient services; inpatient services; residential services; case management; suicide crisis counseling; outpatient programs for chronically mentally ill adults, elderly persons, and children and adolescents; programs for the moderately mentally ill and institutionally dysfunctional persons; outpatient chemical dependency services; employee assistance programs; crisis stabilization inpatient services; detoxification services; and 28-day substance abuse inpatient services. I-2, 43-44. MMHC is required by contract with SIRS, generally speaking, to provide all of these services if not by name, then by subject. I-2, 51. The primary service area of MMHC is Manatee County. I-2, 57. The primary source of funds to MMHC comes from the state, either as state money or federal money allocated by the state, but Manatee County provides some matching money. I-2, 52- 53. Additionally, MMHC receives some money from payment of charges by patients themselves. I-2, 53-55. As a community mental health center, MMHC has the responsibility to tailor its services to serve the middle and lower socioeconomic populations in Manatee County. I-2, 54-57. It is not usual for MMHC to serve patients from upper management or professional persons, or persons other than those in the middle and lower socioeconomic classes. I-2, 83. It is the mission of MMHC to insure that its services are financially accessible to everyone in the community. Id. MMHC is responsible to provide financially accessible services to the "medically underserved" which includes two groups: the "financially indigent" who meet federal poverty guidelines, and the "medically indigent" who do not meet federal poverty guidelines, but who do not have insurance or enough income to pay for health care. I-2, 56-57. The "medically indigent" also includes in concept those persons with insurance who cannot pay the co-payment or deductible. The financially indigent are eligible for 100 percent free care supported by Baker Act and Myers Act funds. MMHC has facilities at ten different sites in Manatee County. I-2, 44. The largest is Glen Oaks, which houses a 12-bed psychiatric crisis stabilization unit (CSU), a 12 bed substance abuse "28-day" unit, and a 12-bed alcohol detoxification unit. I-2, 44, 46. Glen Oaks also currently rents 18 beds that are unfunded and that have been classified as "minimum residential" to satisfy state requirements. I-2, 46, 11-2, 83. Glen Oaks is located just outside Bradenton on the east side, I-2, 50, and is relatively close to MMH. The 12 CSU beds are licensed under Chapter 394, Florida Statutes, and are funded under the Baker Act to provide psychiatric care for the financially indigent only. I-2, 55. The funding under the Baker Act is by the state, with matching county funds, rather than patient fees. I-2, 46. The 12-bed detoxification and 12-bed substance abuse units are operated by contract with HRS under Chapter 396, Florida Statutes, and receive Myers Act state funds matched with county funds. I-2, 51-2, 60. Both units also appear to receive a small amount of revenue from patient fees. I-2, 55. Substantially all of the persons who use the detoxification beds are financially indigent. Id. These 18 "minimum residential" beds were rented as a means to generate enough revenues to cover overhead expenses. I-2, 48. These beds are not considered by MMHC to be a part of the treatment program of Glen Oaks because no services are brought to these persons at the Glen Oaks facility. I-2, 48, 11-2, Persons who rent these beds for $400 to $800 per month are all clients of MMHC who are involved in outpatient programs, primarily the chemical dependency program. I-2, 47-48. The only services provided for the persons renting these beds are room and board. II-2, 63. Medications are controlled by the nursing staff only as a precaution with respect to patients in the other 36 inpatient beds. Id., II-2, 85. The classification of these 18 beds as "minimum residential" is to meet HRS regulations; HRS is aware of this classification and concurs in it. II-2, 83. The building at Glen Oaks was designed for acute inpatient beds, and the 18 minimal residential beds are not suitable for that design and intended purpose. II-2, 86. Under Chapter 394, Florida Statutes, MMHC is designated as a Baker Act public receiving facility for screening, evaluation, and treatment of psychiatric emergencies. I-2, 59. This program operates in a specially provided space at the Glen Oaks facility. I-2, 65. Law officers often bring in such emergency patients. I-2, 66. MMHC has five part-time physicians (four psychiatrists and one internist) working in various programs. I-2, 60-61. There is also one full- time psychiatrist who is the medical director. V-2, 4. These physicians provide psychiatric evaluations, admission and treatment in the inpatient program, chemotherapy in the outpatient programs, consultation to the clinical staff, training, and participate in quality assurance. I-2, 61. The medical director and two psychiatrists work in the inpatient program and the other two psychiatrists work in the outpatient programs. II-2, 13-14. Admissions to the 36 beds currently at Glen Oaks come from either the outpatient programs of MMHC or from emergency screening described above. I-2, 61-62. Thus, generally speaking, admissions to MMHC inpatient beds do not come from physicians in private practice. Hospitals, including MMH, receive admissions from physicians in private practice, from emergency room visits, and (in the case of MMH) from referrals from MMHC. I-2, 62-63, 58, 60. MMHC uses non-physician clinicians to recommend admissions initially. Admissions are then made by physicians after examination and evaluation. Id. Currently, the 36 inpatient beds at Glen Oaks are operated much the same as licensed hospital beds providing the same services in a licensed hospital, except that revenues at MMHC do not come from patient charges but from governmental funding, and MMHC does not have an organized medical staff of physicians who are in private practice. It uses, rather, employed physicians on contract. I-2, 46. Third party payors such as Medicare and commercial insurance companies will not pay for inpatient care at Glen Oaks because it is not licensed as a hospital. I-2, 58, VI-2, 18, 31- 33. Almost all patients who come into the MMHC system and need inpatient care, but have third-party payor coverage, are referred to MMH. I-2, 58. A few patients needing inpatient substance abuse treatment who have third-party payor coverage can be treated at MMHC, but most cannot. Id. By mistake some insured patients are admitted to the CSU for psychiatric care, but treatment is then provided without expectation of reimbursement. I-2, 58. Patients with insurance or other third-party coverage will elect to go where their insurance will pay the bill, VI-2, 40, assuming competence to make the choice. The ability of MMHC to provide indigent care is becoming more difficult due to inflation and current levels of governmental funding. I-2, 53- 54, 125. Expenses have been increasing at about nine to ten percent a year, but public funding has been increasing at about four to five percent a year. I-2, 125. The smaller percentage of increase each year of public funding has not kept pace with the increase in workload caused by increases in population. IX- 2, 47. Moreover, public funding has typically been targeted to particular priorities rather than to general and overall operations. I-2, 125, IX-2, 47. As a consequence, the capability of MMHC to provide care to the various categories of indigent persons in Manatee County has been impaired. VI-2, 31. MMHC has in recent years been able to operate with a small net surplus of revenues over expenses. II-2, 71. The goal of MMHC is to break even or to have a small surplus. II-2, 5. Glen Oaks is currently operating in the black, VII-2, 60, but this is achieved by use of some revenues from other programs which are not dedicated funds. II-2, 72, 74. Currently at Glen Oaks, MMHC has resources to provide only chemotherapy and milieu therapy for psychiatric crisis stabilization, and does not have resources to provide individual, group, activity, or recreation therapies. I-2, 78. Involvement of the family in therapy is now not possible due to lack of resources. I-2, 99. Chemotherapy is drug therapy. Milieu therapy is the provision of a supportive, non-threatening environment. I-2, 78. The Glen Oaks facility is a replacement funded by the state for an earlier facility called Glen Ridge, a facility which provided CSU, detoxification, and 28-day substance abuse services also. II-2, 77. The funding was about $1.9 million. CT/CH Ex. 3, p. 45. The building was completed in May 1985. I-2, 63. The total cost of construction of the new facility has been $2,275,152. 1-2, 120. The Glen Oaks facility is built on land owned by Manatee County and MMHC has a 99 year lease from Manatee County. I-2, 71. The lease is dated September 1982. MMHC Ex. 2, p. 87. With respect to the building, MMHC entered into a lease with SIRS on April 24, 1986, for a term of forty years, leasing all title and interest that SIRS may claim. MMHC Ex. 3. At the time the Florida Legislature appropriated the funds for the new Glen Oaks facility, MMHC had not contemplated construction of a licensed hospital. II-2, 77. It was the understanding of the Executive Director of MMHC that the funds were appropriated to provide a new building in which to provide the services provided at Glen Ridge. II-2, 77. 22. A "clinic" generally is a treatment facility of some sort. A "hospital" is a facility licensed under Chapter 395, Florida Statutes. II-2, It was the opinion of Mr. More that a clinic is not a hospital. At the time that Chapter 82-215, Laws of Florida (1982), was enacted, appropriating funds for the new facility at Glen Ridge, MMHC did not have a "hospital" at Glen Ridge. The new facility at Glen Oaks was designed by MMHC for acute care hospital use. II-2, 86. As discussed above, MMHC applied for a certificate of need with respect to this new facility in August 1983, but has not yet received a certificate of need to operate the new facility as a licensed hospital. The Proposed Project The application of MMHC for certificate of need 2861, as amended, is to establish at Glen Oaks a specialty hospital consisting of 17 short term psychiatric hospital beds and 10 short term substance abuse hospital beds, all of which would be licensed as hospital beds pursuant to Chapter 395, Florida Statutes. If the proposed certificate of need were to be issued, and the beds granted by that certificate of need were licensed under Chapter 395, Florida Statutes, MMHC proposes potential allocations of the beds. The following is a display of the current bed types, the bed types under the first option, and the bed types under the second option: Bed Type License Type Current Option A Option B CSU Chapter 394 12 15 14 Detox Chapter 396 12 10 10 Substance Abuse Chapter 396 12 2 0 Substance Abuse Chapter 395 0 10 10 Psychiatric Chapter 395 0 17 17 Minimum Residential 18 0 0 TOTALS: 54 54 51 I-2, 75-76. Under option A, the substance abuse beds would be physically separated form the psychiatric beds, but otherwise all of the beds licensed under Chapter 395, Florida Statutes, would be spread throughout the facility. I-2, 108. Under option B, a two-hour fire wall would be built to separate all licensed beds from beds not licensed under Chapter 395, Florida Statutes, and substance abuse beds would continue to be separated from psychiatric beds. The separation of substance abuse beds in a wing of the building was demonstrated to the Hearing Officer on a chalk board by Mr. More. The sketch is not in evidence. Apparently the HRS Office of Licensure and Certification (OLC) does not usually allow the mixing of licensed and "unlicensed" beds, and if it does not, then the Petitioner will proceed under option B. Thus, option B appears to be the most probable option. I-2, 107. If the certificate of need at issue in this case is granted, MMHC proposes to always place patients having third party payors in a bed licensed under Chapter 395 (a hospital-licensed bed) if available. Those patients who are financially indigent will be placed in the other licensed beds along with some medically indigent patients. II-2, 35. Some medically indigent patients would also be served in the hospital-licensed beds. II-2, 35, VI-2, 20-21. However, if a bed is available, no one will be denied services because of an inability to pay. II-2, 23, VI-2, 82. If the certificate of need is granted, MMHC will continue to serve Manatee County, and will continue to serve the same groups of patients in the "other licensed" psychiatric (CSU) and detoxification beds; the only change will be the addition of the hospital licensed beds, which will serve patients having third party payer resources, as well as some medically patients. I-2, 82-83. MMHC is currently serving most of financially indigent persons in Manatee County, and thus does not expect to serve any more such persons if the certificate of need is granted, but does expect to be able to provide financially indigent persons in Manatee County with better and more comprehensive services. II-2, 51. MMHC will not reduce its current role in providing Baker Act and Myers Act services at the Glen Oaks facility if the certificate of need is granted. Id., I-2, 80, 83. MMHC proposes to serve those patients having third-party payor resources who are currently being served within the MMHC system, or who may come to MMHC in the future in MMHC's role as a "public receiving facility" for emergencies. I-2, 79. Almost all of such patients now are referred to MMH, and thus MMHC proposes to serve these patients who are now being served MMH. See finding of fact 17 above. It is expected that MMHC will serve insured patients from the middle and lower socioeconomic classes. I-2, 83. These are projected to be having annual incomes of between $20,000 to $40,000 annually. II-2, 43. Over 90 percent of the families and households in Manatee County have incomes less than $35,000 annually, so the great majority of potential insured patients in Manatee County are compatible with the current socioeconomic caseload of MMHC. II-2, 43. Issuance of the proposed certificate of need to MMHC will enable MMHC to add the following services for its inpatient beds at Glen Oaks, services which currently are not provided: individual therapy, group therapy, activity therapy, an recreation therapy. II-2, 78. These services would thus be expanded for all patients, including the financially indigent and medically indigent. Enhancement of services will enable MMHC to attempt to treat more than just the acute psychiatric episode. V-2, 12. The family of the patient will be more involved, staff will have more time to try to identify the underlying cause of the psychiatric illness, where possible, and more time will be available to provide education for the patient to assist in his or her own self-care. Id. The proposal would also result in more continuous care provided by the same staff within the MMHC system for patients having third-party payor resources who currently must be referred to facilities outside of the MMHC system. I-2, 78-79. Continuity of care is an important goal of a mental health system. IX-2, 96. Having the ability to track patients, assure continuity of treatment, and assure that the patient is treated at the appropriate level of treatment is what is meant by continuity of care. Id. With a continuum of services in the chance that the patient will be neglected is lessened, the patient should be treated at the proper level without the inefficiency of having to be transferred to another system having no familiarity with the patient. IX- 2, 94-97, IV-2, 136. Community mental health centers were created in part to continuity of care to the community. IX-2, 95. Issuance of the proposed certificate of need to MMHC would improve and foster competition among short term and substance abuse providers in Manatee County in the future. Currently, there are only 25 short term psychiatric hospital beds in the counties, all at MMH, and there are no hospital licensed short term substance abuse beds. See finding of fact 41D. The charges at MMHC will be lower than charges for similar services in the area. See finding of fact 111. If the proposed certificate of need is issued, MMHC would no longer rent 18 beds in what it now calls a "minimum residential" category of beds. Minimum residential treatment beds, providing a form of halfway residential setting between inpatient care and the community, are a very important service for a community mental health center to provide. IX-2, 103-4. MMHC plans to develop some form of minimum residential beds in the future. II-2, 85. Development of this service would involve additional costs. The 18 minimum residential beds provide a valuable housing service to those persons now renting these beds, and in that way provide a valuable service to Manatee County as well. But the beds are not treatment beds, and are not part of any treatment program as such. See finding of fact 12. Persons now using the 18 beds would probably benefit from having a more structured environment, but they also probably could function adequately on their own renting housing in the community IV-2, 155-59. The evidence indicates that these persons will find housing in the community. II-2, 84. There is no persuasive evidence in the record that the 18 minimum residential beds are necessary or essential to the persons now renting them, or that it would be impossible for them to rent or find other accommodations in the community. MMHC seeks the certificate of need in this case primarily to allow it to treat patients having third party payor resources at Glen Oaks so as to generate additional revenues so that improved mental health services may be provided to the financially and medically indigent of Manatee County. With the exception of the improvements to services caused by expansion of therapies available, discussed above, there are no significant differences between the psychiatric or substance abuse treatment services that MMHC provides now to persons occupying the other licensed beds and the services that will be provided if a certificate of need is granted. VI-2, 127-28. Moreover, will not be any significant differences between the treatment services that will be provided in the hospital-licensed beds, should a certificate of need be granted, and the beds licensed under other Florida Statutes. II-2, 21, 35. The quality of care currently provided by MMHC is very good, and meets all criteria set out by HRS, but the quality of services provided by MMHC could be enhanced and improved if resources were available. II-2, 28-29, V-2, 19, 21. Patients who currently are discharged from inpatient care do not have need for more inpatient care. V-2, 21. Need For the Proposed Project The "planning horizon year" is the year in which need for short term psychiatric or substance abuse beds will be calculated pursuant to HRS rules, and is July 1988 in this case, which is five years from the date of the application. See findings of fact 41 and 42, order of May 14, 1986, Appendix B. Despite the delay in this case in coming to final hearing, a planning horizon year of 1988 is still appropriate since MMHC can begin operations rather quickly because no major construction is needed. III-2, 45-46. Following the methodology of rules 10-5.11(25)(d) and 10-5.11(27)(f), Florida Administrative Code, there is projected to be a surplus of 154 short term psychiatric hospital beds and a surplus of 68 short term substance abuse hospital beds in District VI in the horizon year, 1988. VIII-2, 49. The amended application of MMHC identifies a bed need specified in the 1983 District VI local health plan, which is MMHC Ex. 1, and does not seek to satisfy a bed need identified in any later state or local plan. See findings of fact 29 through 36, Appendix B. The Community Medical Facilities Component of the District VI Local Health Council plan was adopted on August 1, 1983. MMHC Ex. 1. In 1983, HRS District VI consisted of Hillsborough and Manatee Counties only. MMHC Ex. 1. The 1983 District VI Health Plan showed a net surplus of short term psychiatric hospital beds by 1988 of 133 and a net need of 57 short term substance abuse hospital beds by the same year. Id., p. 52-53. The Community Medical Facilities Component of the District VI Local Health Council plan designates Manatee County as a distinct planning and service area for assessing bed need for psychiatric and substance abuse services. MMHC Ex. 1, p. 53. The plan designates Manatee County as a distinct area according to the plan, most Manatee County residents are beyond 45 minutes travel time to facilities located in Tampa. Id. It also treats Manatee County as a distinct area because the county has only one existing provider of short term psychiatric beds, MMH, which had a greater than 100 percent occupancy rate in 1982. HRS officials charged with the responsibility to review and recommend approval or disapproval of applications for certificates of need have concluded that Manatee County is a proper service and planning area for calculation of need in this case. See findings of fact 20 and 22, order of May 14, 1986, Appendix B; II-1, 188-91. Short term psychiatric care is a part of a continuum of care that is aimed at deinstitutionalization. II-1, 143-44. Short term psychiatric patients have a greater need to be in touch with their local communities. Id. Having all mental health services available in the local community, rather than at greater distances away, fosters the goal of continuity of care. Manatee County is designated as a "mental health catchment area" by the National Institute of Mental Health. III-2, 55, 63-64. This designation is intended to identify needs and resources within the designated geographical area. Id. Manatee County is designated by the United States Bureau of Census as a-metropolitan statistical area. III-2, 55. Other applicants for certificates of need for short term psychiatric or substance abuse services have considered Manatee County to be the proper area for planning and determining need, notably the application of Charter Medical-Southeast, Inc., d/b/a Charter Haven Hospital for certificate of need 4294, which contains an analysis of need from Fagin Advisory Services, Inc., dated December 22, 1985, pages 3-20. MMHC Ex. 6. It is therefore reasonable to consider Manatee County as a separate service and health planning area for assessment of need for short term psychiatric and substance abuse hospital beds. HRS has not by rule adopted Manatee County as a subdistrict for determining need for short term psychiatric or substance abuse services. It has done so in this case as a matter of incipient policy and that policy has been found in this case to be reasonable. See finding of fact 38. The 1983 Local Health Council plan, using the methodology contained in the state rules applied only to Manatee County, found a gross need in Manatee County by 1988 for 65 short term inpatient psychiatric hospital beds, and 11 short term inpatient substance abuse beds. MMHC Ex. 1, p. 53. The net need is 40 short term psychiatric hospital beds and 11 short term substance abuse hospital beds. III-2, 68. The conclusion that there is a net need for short term psychiatric and substance abuse beds contained in the preceding paragraph is corroborated and supported by the following additional findings: The historical use rate for short term psychiatric beds in District VI has been 88.4 patient days per 1,000 population, and the use rate for short term substance abuse beds in District IV has been 26.5 patient days per 1,000 population. III-2, 78-80. A district rate is more reliable since it tends to average out under-utilization that may be caused by lack of beds in a particular county. Id. Applying these use rates to 1988 populations, there would be a need for 31 to 35 short term psychiatric beds and 17 short term substance abuse beds in Manatee County by 1988. Id. Manatee County currently has only .14 short term psychiatric beds per 1,000, while District VI has 47 beds per 1,000. III-2, 79. Accepting the rate of .35 beds per 1,000 as a norm, that rate having been promulgated as a need rate in rule 10-5.11(25), Florida Administrative Code, then there is a shortage of these beds in Manatee County. Manatee County has only 25 short term psychiatric hospital beds currently and those are located at MMH. Manatee County has no hospital licensed short term substance abuse beds. III-2, 69, 150. The occupancy rate for the 25 short term psychiatric beds at MMH has been consistently very high since 1980: 82.9 percent in 1980, 87.0 percent in 1981, 102.0 percent in 1982, 112.0 percent in 1984, 88.0 percent in 1985, and 97.0 percent in the first four months of 1986. III-2, 66, 70, CH/CT Ex. 8, p. 154, MMHC Ex. 1, p. 30. It is preferable that MMH operate under 75 percent occupancy. XI-2, 124. Charter Tampa's parent corporation, Charter Medical-Southeast, Inc., presented in an application for a certificate of need an analysis showing a net bed need of 63 short term psychiatric beds for Manatee County in 1990. MMHC Ex. 6, p. 17-20. The method used was essentially the same as proposed by the Petitioner, except that 1990 populations were used, and was presented by the same consulting expert who testified for Charter Tampa during the hearing. Id. MMH has applied for a net increase of 17 short term psychiatric hospital beds and 11 substance abuse beds in a comprehensive application for certificate of need in a later batch in which Charter-Medical Southeast, Inc., has two pending applications. CH/CT Ex. 1, p. 2. The services proposed by the Petitioner are thus consistent with, and would partially satisfy, the need for short term psychiatric and substance abuse inpatient hospital beds as set forth in the 1983 local plan. The 1983 state health plan is not in evidence. As will be discussed in the conclusions of law, the 1985 versions of these plans are not legally relevant to Petitioner's application in view of recent case law. Alternatives The short term psychiatric beds at MMH have been running at a very high occupancy rate for the last five years. A significant number of psychiatric patients having insurance or other third party payors are currently referred for treatment to MMH by MMHC. I-2, 58, 60. If the certificate of need sought in this case were to be granted, MMHC would retain most of these patients for treatment, and would no longer refer them to MMH. See findings of fact 27 and 17 above. However, the local health plan identifies 40 short term psychiatric beds need by 1988, and MMHC proposes to serve only 17 beds of that need, or less than 50 percent. The total need is 65 beds, and 23 beds, or 35 percent of the gross need, would be unmet by the Petitioner or anyone else. This unmet need would be available to MMH as well as to other providers, such as Charter Tampa, and constitutes a very substantial additional source of patients. It must be concluded, therefore, that although MMH will lose patients now referred by MMHC, in the long term MMH will not suffer significant reduced occupancy. Given the level of need shown, and the higher occupancy rates shown at MMH, it must further be concluded that MMH does not provide an adequate alternative in the service area to satisfy all need for short term psychiatric inpatient hospital beds. MMH does not provide any certificate of need approved hospital licensed short term substance abuse beds, and thus there are no alternatives in the service area for this service proposed by the Petitioner. The 12 CSU beds at MMHC are not an adequate alternative to the 17 short term inpatient hospital psychiatric beds sought by MMHC in this case. If they were, the occupancy levels at MMH would be substantially lower. Moreover, the 12 CSU beds are not adequate to treat patients having third party reimbursement sources. See finding of fact 17. Finally, assuming hypothetically that CSU beds should be deemed to be an adequate equivalent of hospital licensed beds, the current 12 CSU beds at MMHC only would fulfill a portion of the net need in Manatee County for 40 inpatient hospital psychiatric beds. A net residual need of 28 beds would still exist to be served by the 17 short term beds proposed by MMHC. Quality of Staff and Care The parties stipulated that there was no issue in this case concerning the quality of staff that would be used if this certificate of need were granted. I-2, 14. Moreover, the number of full time equivalent positions (FTE's) proposed is not contested either. I-2, 15. The quality of care now provided by MMHC is good, and good quality of care would be provided if the certificate of need were granted. See finding of fact 33. Indigent Services Currently, the Glen Oaks facility operates 12 CSU (psychiatric) beds, 12 detoxification beds, and 12 substance abuse beds. It also rents 18 beds which it terms "minimal residential." See findings of fact 9 through 12. If the certificate of need in this case were granted, it would continue to operate essentially the same number of beds in each category with the exception of the minimal residential beds. See finding of fact 24. The only major change to existing services would be replacement of the 18 "minimum residential" beds with 17 hospital licensed short term psychiatric inpatients beds. The 18 rented beds are not associated with inpatient programs, and are not similar to the 17 short term psychiatric hospital beds. MMHC intends to continue to serve indigent patients and to expand these services as population grows. III-2, 89. Currently, MMHC uses a sliding or discounted fee system, charging patients according to ability to pay. I-2, 54-55. If the certificate of need is granted, MMHC will collect essentially the same total minimal level of revenues from these same indigent patients. II-2, 36-37, VI-2, 19-22. Although there will be no sliding fee schedule, the result will be the same: such indigents will receive care paying the same minimal total amount. VI-2, 77, II-2, 36-38. Thus, if the certificate of need at issue in this case were granted, MMHC would not eliminate any of its current inpatient psychiatric (crisis stabilization), detoxification, or substance abuse services for indigents. These inpatient services would still be available to the same extent at minimal or no cost to such persons, except that additional and enhanced therapies and services will be made available to indigents. See finding of fact 26. Geographical Accessibility Glen Oaks will be geographically accessible to all residents of Manatee County, though it will not provide any geographic accessibility advantage different from nearby MMH. Both MMHC and MMH are well located to be near a large portion of the population of Manatee County. Short Term Financial Feasibility There are adequate resources to complete the project proposed by the Petitioner. The building was funded by the Legislature and is essentially complete. Funds exist for any necessary modifications and for all equipment. I-2, 111, 116- 117. It was stipulated that adequate and qualified staffing has been proposed and will be obtained to operate the new beds as proposed at Glen Oaks. I-2, 14-15. The project proposed by MMHC is financially feasible in the short term. Long term Financial Feasibility Long term financial feasibility involves a number of sharply disputed issues of fact. Paragraphs 51 through 112 will address these issues. Deborah J. Krueger was accepted as an expert in health care facility financial feasibility and health care financial analysis. V-2, 56. Karen Wolchuck-Sher was accepted as an expert in health planning. III-2, 48. It was Ms. Wolchuck-Sher's expert opinion that there is a need for 17 short term inpatient hospital psychiatric beds and 10 short term inpatient hospital substance abuse beds in Manatee County as proposed by the Petitioner. III-2, It was Ms. Krueger's expert opinion that the proposed project would be financially feasible in the long term. VI-2, 6. Ms. Wolchuck-Sher testified primarily concerning need. Ms. Krueger testified primarily concerning financial feasibility. The projection of expected patient days for the 17 short term psychiatric beds and 10 short term substance abuse beds was prepared by Ms. Wolchuck-Sher and used by Ms. Krueger in her financial feasibility analysis. VI-2, 69. However, to produce a projection of payor mix, Ms. Krueger had to analyze the same data relied upon by Ms. Wolchuck-Sher to determine projected patient days. VI-2, 70. Projected Patient Days Based entirely upon patients estimated to already be within the MMHC system, but who are typically referred elsewhere because they have insurance or other third party payor resources, MMHC projects that on the first day of operation of the proposed 27 hospital licensed beds, occupancy will be 64 percent or an average daily census of 17 patients. III-2, 128-29, 154. It is further projected that this occupancy level will average 70 percent in the first year of operation, ending August 31, 1988. III-2, 129, The 17 patients estimated to be available on an average daily basis from the beginning were identified as patients that currently are seen and treated in MMHC programs and who could be referred for treatment to the hospital licensed beds if the certificate of need were granted. III-2, 131. These would include people with insurance and Medicare, but not Medicaid, or those who have a physical illness requiring hospitalization. Id. The 17 patients estimated above was based upon a study conducted by staff of MMHC, which was reviewed by both Ms. Wolchuck-Sher and Ms. Krueger. See finding of fact 52. III-2, 128-29, 132. The study included discharge records of patients from July 1985 to February 1986. The discharge records were reviewed to determine whether the patient had been referred for treatment to a hospital licensed bed elsewhere. A cross check of MMH records was performed to determine if MMH actually treated the referred patient. Ms. Wolchuck-Sher did not personally count the numbers, but she personally reviewed the census sheets prepared by MMHC staff, studied the methods used to tabulate the numbers, and concluded that the methods used were reasonable. III-2, 132-36, 146. Based upon the study, an initial average daily census of 17 was projected. III-2, 136. The 17 patients on an average daily census was projected by tabulating admissions, multiplying admissions by projected average lengths of stay by program, and converting this to a monthly rate. III-2, 137, 146-47. The average length of stay was based on actual current experience at MMHC, projected increase in average length of stay when MMHC at Glen Oaks adds new forms of treatment programs, and comparisons to current average lengths of stay at the 25 short term psychiatric beds at MMH. III-2, 139. By program, the following numbers of patients and projected average lengths of stay were identified in the study relied upon by Ms. Wolchuck-Sher and Ms. Krueger: about 7 patients per month from the geriatric residential treatment services (GRTS) program with an average length of stay of 20 days, IV- 2, 115, VI-2, 65, XII-2, 29-30; about 6 patients per month from the crisis stabilization unit (CSU) with an average length of stay of 10 days, IV-2, 72, XII-2, 29-30; about 2 patients per month from the employee assistance program (EAP) with an average length of stay of 10 days, VI-2, 73, XII-2, 29 30; about 2 patients per month from outpatient programs, with an average length of stay of 10 days, although outpatient programs, excluding GRTS, show on the census sheets about 7 admissions a month, VI-2, 73-74, XII-2, 32; and an average daily census of 9 patients in the 10 substance abuse beds, with an average length of stay of days, III-2, 155, 158, 159, 161. Currently, the 12 substance abuse beds have an average 75 percent occupancy, which is an average daily census of 9 patients. III-2, 161. MMHC simply projects that these patients will fill the 10 hospital licensed beds if the certificate of need is granted. III-2, 155, 159. Mathematically, the patients identified in finding of fact 57 results in the following: Average daily Program that Average Patient census (Patient is the source Monthly length days for days divided by of the referral Admissions of stay each month 30 days in mo.) GRTS 7 20 140 4.67 CSU 6 10 60 2.00 EAP 2 10 20 0.60 Outpatient 2 10 20 0.67 Subtotal: 8.01 Substance abuse 9.00 TOTAL: 17.01 From the foregoing, the average length of stay of patients from all programs except substance abuse programs would be 14.1 days. (240 patient days divided by 17 admissions.) This is consistent with testimony that the average length of stay for "psychiatric patients overall" would be 14 days, but that CSU patients would have an average length of stay of 10 days. III-2, 154. Ms. Wolchuck-Sher's testimony on this point is not clear, but the foregoing analysis is the only one that makes sense on this record. Apparently Ms. Wolchuck-Sher did not consider the substance abuse beds when she testified as to projected average length of stay since the substance abuse beds were, in her opinion, projected to have a 21 day average length of stay, and were simply to continue the same daily census of 9 patients. III-2, 158, 161. The reason for the "overall" 14 day average length of stay is that although many of the patients referred to the short term psychiatric beds will have an average length of stay of 10 days, those who are elderly and originate from the geriatric residential treatment service program will have an average length of stay of 20 days. The numbers of potential admissions identified in paragraph 57 above are reasonable. These numbers come from actual experience of MMHC, and the methods of collecting were found to be reasonable by an expert in health planning. The numbers of potential admissions come from patients already within the MMHC system and do not depend upon referrals from private physicians. III- 2, 92-93. Thus, even if one were to assume that patients of private physicians, and such physicians themselves, would prefer not to use short term hospital services at MMHC due to its role as provider for indigents, this does not alter the projected number of admissions. MMHC currently serves about 5,000 persons annually in its many programs. I-2, 89. It also serves as a public receiving facility for emergency psychiatric cases. Id. Thus, it is reasonable to expect that the existing MMHC mental health system will in fact be a source of the referrals estimated in paragraph 57 and 58 above. III-2, 82-83. Moreover, the estimated numbers of admissions are conservative in several respects. First, the outpatient programs were relied upon as a source of only 2 admissions per month, although the estimate could have run as high as 7 admissions per month. See paragraph 57. Also, the estimate does not consider potential admissions from private physicians, but the opportunity for such admissions will exist because MMHC will operate an open medical staff, and any qualified community physician may join. II-2, 7, 87-88. Undoubtedly some additional referrals would be made to MMHC because MMH is operating now at capacity and the numeric need estimates shows a need for 40 short term psychiatric beds by 1988. At an average daily census of 17, with 9 of this in substance abuse beds, MMHC is projecting that it will only attract a small portion of that need: enough to fill 8 of the 40 beds, leaving an unmet demand for 32 beds. It is not unreasonable for MMHC to project initially that it will 20 percent of the unmet need of Manatee County. The projected average length of stay of 20 days for patients in the geriatric residential treatment program is reasonable. It may be inferred that healing for the elderly may be slower, and that therefore the length of stay will be longer than for other short term psychiatric patients. IX-2, 88-89. The projected average length of stay for admissions to the 17 hospital licensed psychiatric beds from the CSU, EAP, and other outpatient programs of 10 days is reasonable. Manatee Memorial Hospital currently experiences an average length of stay in its 25 short term psychiatric beds of about 10 days, and there is no reason to believe that the same type bed at MMHC will not function the same. III-I, 148. Although the CSU at Glen Oaks currently has an average length of stay of 6.5 days, III-2, 147, this is based upon the current limited services which consists only of chemotherapy and milieu therapy (which is only a supportive, non-threatening atmosphere). I-2, 78. If the certificate of need is granted, MMHC will be able to provide more individualized therapies such as activity therapy, recreation therapy, group therapy, and individual therapy. I- 2, 78. It is reasonable to infer that provision of more staff, as will be discussed ahead, aimed at providing more individual attention, will result in longer inpatient stays, III-2, 147-148, at least until the average length of stay is similar to that currently at Manatee Memorial Hospital. The projection that there will be 9 patients on average occupying 9 of the 10 substance abuse beds each day is reasonable based upon current actual occupancy in the same beds at Glen Oaks. See finding of fact 57. This projection does not depend upon an average length of stay since the average daily census is known. However, it would appear that to the extent that Ms. Wolchuck-Sher assumed that the average length of stay in the substance abuse beds would be 21 days, III-2, 158, it appears this was too conservative. The current average length of stay in the substance abuse beds is actually 28 days. II-2, 12, V-2, 21. From findings of fact 54 through 62, it is concluded that the estimate that the proposed 17 short term psychiatric beds and 10 short term substance abuse beds will initially open with about a combined average daily census of 17 patients, or an occupancy rate of 64 percent, is reasonable and supported by the evidence. The projection that the 27 new beds would have an 80 percent occupancy rate in the second year effectively means that the 10 substance abuse beds will continue to be occupied by an average daily census of 9 patients, and that the occupancy of the 17 psychiatric beds would increase to an average daily census of 12.6 patients. (80 percent of 27 beds is a 21.6 average daily census. If 9 of these beds were occupied by substance abuse patients, the remainder of the 12.6 would be occupied by psychiatric patients.) At 64 percent occupancy, the substance abuse beds would have a daily average of 9 patients and the psychiatric beds would have a daily average of 8 patients. See finding of fact 58 above. Thus, the 80 percent occupancy projection is simply a projection that the average daily census in the 17 psychiatric beds will grow from 8 (47 percent occupancy) to 12.6 (74 percent) occupancy in two years. This is an entirely reasonable projection. In effect, it predicts that in two years, MMHC will service 12.6 beds of the 40 net short term psychiatric beds needed in Manatee County by that date. Given the fact that this leaves a shortfall of 17.4 short term psychiatric beds in Manatee County, there ought to be sufficient demand to achieve this projection. It is not unreasonable to project that at the end of two years, MMHC will capture only 31.5 percent of the projected net need for short term psychiatric beds in Manatee County. In summary, the expert opinion of Ms. Wolchuck-Sher that an 80 percent occupancy rate is a reasonable projection for the second year of operation is quite credible and is accepted. Moreover, there is no evidence in the record to believe that the 80 percent occupancy rate will not continue through the third year. Once established, the need projections (based upon a population which, on this record, cannot be concluded to be expected to diminish in 1989 or 1990) remain at least constant, and thus it is reasonable to infer that MMHC will retain and serve enough patients in the third year of operation to sustain a continued 80 percent occupancy rate The number of patient days projected in the second year for purposes of long term financial feasibility, 7905 patient days (see table 7, page 48, MMHC EX. 2) is based entirely upon the projection of 80 percent occupancy in the second year. III-2, 156. It is simply 27 beds times 80 percent times 366 (the number of days in leap year 1988). Id. Since the projection of 80 percent occupancy is reasonable, the projection of 7905 patient days in the second year is also reasonable. The reasonable nature of the projection of 7905 patient days in the second year of operation is further corroborated by the projection of patient days in the application of Charter Medical-Southeast, Inc., d/b/a Charter Haven Hospital for certificate of need 4294. MMHC Ex. 6. That application included a "bed need study" by Fagin Advisory Services, Inc., dated December 22, 1985. In that study, a net need of 63 short term inpatient hospital psychiatric beds was estimated in Manatee bounty by 1990. MMHC Ex. 6, p. 19. Further, the applicant estimated that in the 12 months from May 1987 to April 1988, its project would serve 9122 short term psychiatric hospital patient days. Id. at p. 31. This should be compared with the short term patient days contained in the estimate of 7905 patient days by MMHC, which includes short term substance abuse patient days as well. The annual short term substance abuse patient days were derived from an estimate of 9 beds occupied at all times, which would result in 9 times 366, or 3294 patient days devoted to short term substance abuse. See paragraph Thus, the MMHC projection of short term psychiatric patient days in this case is only 4611 in 1988, a number quite smaller than 9125 days estimated by Charter Medical-Southeast. Dr. Fagin, who testified for Charter Tampa, testified that he would not be surprised if there were 7905 patient days of demand in Manatee County. XI-2, 128-29. Patients having third party payor resources will to some substantial degree choose not to be served by a community mental health center like MMHC because MMHC serves a large number of indigent patients. IX-2. 102. Similarly, it is reasonable to expect that a number of private physicians in the community will continue to use MMH for inpatient mental health care, and will not be referring paying patients to MMHC. XI-2, 72-73. Nonetheless, the reasonableness of the projection of 7905 patient days is not significantly undermined by the expected reluctance and refusal of a substantial number of third party payor patients to use MMHC. There are several reasons for this conclusion in the record. First, as discussed above, the projection of 7905 patient days is not based upon referrals from private practice physicians; it is based primarily upon referrals of patients already within the MMHC system who, for one reason or another, have affirmatively chosen that system. Second, if MMHC upgrades its services by the addition of more therapies as planned, its inpatient hospital beds will be more attractive to patients. Moreover, it has a new physical facility, and thus the building itself should not be a deterrent to patients. Other mental health centers having hospital licensed inpatient short term psychiatric and substance abuse services have been able to attract a substantial number of patients having Medicare or other third party payor resources. The Brevard Mental Health Center operates a hospital with 48 hospital licensed beds, 20 of which are short term substance abuse beds and 24 of which are short term psychiatric beds. IX-2, 37-38. The Brevard Mental Health Center is a community mental health center responsible to provide community mental health services regardless of ability to pay. IX-2, 37-38. The services are generally the same type as provided by MMHC. IX-2, 37, 64-66. Approximately 41 of the 48 beds are normally occupied, and of these, about one half are normally occupied by patients having third party reimbursement or payor sources. IX-2, 44. These were more specifically distributed as follows: 15 percent of the psychiatric beds (15 percent of 28 or 4.2) were Medicare, 18 percent of the psychiatric beds (18 percent of 28 or 5) were insurance, and 80 percent of the substance abuse beds (80 percent of 20, or 16) were insurance IX- 2, 52. 53. Thus, a total of about 25 of the 48 beds were occupied by patients having third party reimbursement resources. For the past five and one-half years, the Brevard Mental Health Center has been able to achieve its budgeted goal of placing in hospital licensed beds patients having third party payor resources. IX-2, 45. There are about six other community mental health centers in Florida having hospital licensed short term psychiatric beds. VIII-2, 63. In 1984, the four community mental health centers then having hospital licensed beds were able to attract Medicare and other charged based patients. XII-2, 61. In addition to the success of other community mental health centers, Charter Tampa's own expert was of the opinion that Charter Tampa would lose from one-third to two-thirds of its current annual number of patients (14) from Manatee County if MMHC obtains a certificate of need as proposed in this case. See finding of fact 115. Obviously, then, Charter Tampa's expert was of the opinion that Manatee County patients would choose to be served by MMHC if that alternative were available to them, and would not be deterred by the fact that MMHC serves indigents. While the conclusion that Charter Tampa will lose patients has been rejected due to the large quantity of unmet need in Manatee County, Dr. Fagin's assumption that MMHC would be an attractive alternative to Charter Tampa is supported by other evidence in the record. Finally, the projections of 64 percent occupancy in the first year, and 80 percent occupancy in the second year, as discussed above, assume that MMHC will capture only a modest number of the total number of patients in 1988 in Manatee County needing short term psychiatric health care: 20 percent in the first year and 31.5 percent in the second year. See findings of fact 57, 58 and While some patients and their families may in fact be reluctant to use the services of a community mental health center, the projections of MMHC are well within any reasonable range of predicted loss of patients due to stigma associated with services to economically disadvantaged persons. Short term psychiatric patients in Manatee County have to go somewhere reasonably close by, and MMC is full. This fact alone will overcome some of the reluctance of patients or others to use MMHC. About one to two percent of all psychiatric and substance abuse patients also have a medical problem, and these patients would continue to be referred to MMH despite the existence of a mental health problem as well. V-2, 13-14. The evidence, however, is not sufficiently clear to categorically conclude that one or two percent of the persons needing inpatient psychiatric hospital care or inpatient hospital substance abuse care will also have a medical problem. The record cited above is from the testimony of Dr. Ravindrin, who thought that the percentage of "dually diagnosed" patients to be "very small," and that "it may be one or two percent of the people who might need actual medical intervention plus active Dsvchiatric treatment at that moment." Id. From this it is uncertain to what extent the percentage applies to those patients needing inpatient care, as opposed to other forms of "active psychiatric-treatment." The evidence does compel the conclusion that some small percentage of patients needing to be served in a hospital inpatient short term bed may also have need of medical treatment. However, this fact does not appear to be relevant since the projections of patient admissions were derived from studies that estimated the numbers of patients who in fact would be admitted to hospital licensed beds at Glen Oaks if a certificate of need were granted. See finding of fact 57. There is no evidence that any of these patients are expected to have a dual diagnosis, and given the nature of the purpose of the study, it would be expected that dually diagnosed patients would not have been counted. The foregoing findings of fact 34-69 concern only the 27 hospital licensed psychiatric and substance abuse beds. Under option A, see finding of fact 24, MMHC will continue to operate 15 crisis stabilization unit beds, 10 detoxification beds, and 2 substance abuse beds, and will continue to have these beds licensed pursuant to either chapter 394 or 396, Florida Statutes, as "other licensed" beds, but not hospital licensed. Under option B, which is more probable, MMHC will continue to operate 14 CSU beds and 10 detoxification beds, again as "other licensed" beds. The long term financial feasibility projections estimated that these "other licensed" beds would continue to serve the same indigent patients as currently served in the 12 CSU beds and 12 detoxification beds operated by MMHC. VI-2, 81-82. In future years, the financial feasibility projection simply assumes that the number of patient days in these "other licensed" beds will grow in proportion to the increase in population in Manatee County. Id.; III-2, 88-90. The occupancy rate generated by these estimates was 65 percent in the "other licensed" beds for both years since the population increase was quite small. III-2, 89. These projections are reasonable. Id. Projected Staffing Table 11, page 51, of the updated application for certificate of need, MMHC Ex. 2, contains the proposed staffing for the new hospital licensed beds. VI-2, 23. The parties have stipulated that the numbers of full time equivalents (FTE's) shown on Table II are adequate for the programs proposed by MMHC and the parties further stipulated that there is no dispute in the case concerning the ability of MMHC to hire and retain qualified persons to fill these positions. I-2, 12-15. MMHC currently operates with 37.7 FTE's. It proposes to add 35.2 full time equivalents if the certificate of need is granted for a total of 73.2 FTE's. Table 11, MMHC Ex. 2. Currently, MMHC operates with 0.8 FTE's for medical staff. It proposes to add 1.8 FTE's to make this 2.4 FTE's for the medical staff. If the certificate of need is granted, Dr. Ravindrin would fill one full time equivalent, and the remaining 1.4 FTE's would be provided by other physicians who currently have a relationship with MMHC. Table 11, MMHC Ex. 2; 11-2, 14-15. MMHC currently has only 4.0 FTE's for treatment staff, but proposes to add 6.0 FTE's if the certificate of need is granted. Table II, MMHC Ex. 2. These new staff positions will provide the enhanced psychiatric treatment therapies described in finding of fact 28. I-2, 99. MMHC currently has 21.1 FTE's of nursing staff, and would add 13.9 nursing FTE's if the certificate of need were granted. Table 11, MMHC Ex. 2. This would provide 0.65 nursing FTE'd per bed (35/54) compared to the existing ration of 0.59 (21.1/36). Id. II-2, 52. The administrative staff is proposed to increase from the current 2.0 FTE's to 4.0 FTE's, and this will enable MMHC at Glen Oaks to handle the reporting requirements and other administrative work associated with the facility. 1-2, 99; Table 11, MMHC Ex. 2. The current level for support staff (kitchen, janitorial, and so forth) is 9.8 FTE's and would be increased to 21.0 FTE's. Table 11, MMHC Ex. 2; II-2, 17, 53. The current level of consultant staff (pharmacy and dietary) is 0.3 FTE's and this would increase to a total of 0.6 FTE's if the certificate of need were granted; Table 11, MMHC Ex. 2 is in error on this point. I-97. Projected Revenues Long term financial feasibility is determined by comparing projected revenues with projected costs. MMHC Ex. 2, Appendix A. Projected revenues are determined by projected patient days (utilization forecasts) and a projected average charge per patient day. VI-2, 12-13. MMHC projected an average gross charge per patient day based upon the kind of operating margin MMHC wanted to have, the expected payor mix, and consideration of the charges of other facilities. VI-2, 13. The charges of all of the community mental health centers and all of the free standing psychiatric facilities in Florida as reported in the 1984 Hospital Cost Containment Board Report, and the charges of Charter Tampa and MMHC for 1986 were reviewed by MMHC's expert in determining the proposed average charge for the hospital licensed beds. VI-2, 14. The average daily charge proposed by MMHC is $295 per day in the first year of operation and $313 per day in the second year of operation. VI-2 37-38. If the certificate of need is granted, MMHC will hire a consultant to assist it in preparing a schedule of specific fees by service so as to achieve the average cost per day projected to be both competitive and to cover expenses. I-2, 126; VI-2, 53. The technique of projecting an average charge per patient day is commonly used by experts to forecast revenues and to establish actual charges, and is also commonly used in certificate of need proceedings, and is reasonable. VI-2, 53, 41; VIII-2, 9-14. Analysis of projected revenues must proceed by considering first the 27 inpatient hospital beds that are the subject of this application for certificate of need, the hospital licensed beds, and then considering the remaining beds to as "unlicensed" beds in the forecast statement of revenue and expense, Appendix A, MMHC Ex. 2. In the second year of operation, which is the most relevant for consideration of financial feasibility, the projected 7905 patient days will generate $2,474,265 in gross revenue at an average daily charge of $313. Table 7, p. 48, MMHC Ex. 2; VI-2, 12-14, 38-39. The mix of patients in the 27 hospital licensed beds in the second year is estimated to be 29.6 percent Medicare, 48.2 percent insurance, and 22.2 percent private pay. Table 7, p. 48, MMHC Ex. 2. The estimate of 29.6 percent Medicare is based upon the current 27 percent of admissions that currently are GRTS patients plus the increasing trend in Medicare utilization. VI-2, 66-67. From the study that identified the types of patients who were within the existing MMHC system and were candidates for referral to the hospital licensed beds it was estimated that about 30 percent of the total number of such persons were patients having insurance; it was further projected that once the enhanced therapies are added to MMHC, this percentage would increase to 48.2 percent. VI-2, 71-75. The remainder of the payor mix would be private pay patients, or 22.2 percent of the patient days. Table 7, p. 48, MMHC Ex. 2; VII-2. 72. The estimated mix of patient days for the 27 hospital licensed beds is reasonable. V1-2, 40. It is projected that in the second year of operation, MMHC will have $1,106,891 total deductions from the gross revenues of $2,474,265, leaving net revenues of $1,367,374. Appendix A, MMHC Ex. 2. There are three deductions projected: Medicare, bad debts, and indigent care. Id. Since no Medicaid patients can be treated in free standing psychiatric beds, there is no Medicaid deduction. A total of $343,906 is projected as a Medicare deduction. Appendix A, MMHC Ex. 2. The Medicare program reimburses for the lesser of charges or reasonable costs in a free standing inpatient psychiatric facility. VI-2, 16; XII-2, 49. The calculation of the Medicare deduction was based upon the assumption that Medicare would reimburse 100 percent of the average cost per patient day. The average cost per patient day was roughly $166 for the second year of operation, which is the total operating expenses divided by the total number of patient days. XII-2, 47-48. Thus the Medicare deduction is basically the gross average daily charge, $313, less the average daily cost, $166, which is $147, times the estimated number of Medicare patient days, 2,342. VI-2, 15- 16. It is reasonable to base the estimated total Medicare reimbursement upon the average cost per patient day. This technique does not necessarily assume that Medicare will not disallow some costs in actual practice. XI1-2, Rather, the estimate is based upon a set of estimated costs, which produce the average daily cost, which in and of themselves do not contain any costs which are typically disallowed by Medicare officials. XII-2, 49. Moreover, the average cost per day is not reported Medicare. XII-2, 80. The report is based, rather, upon cost center accounting. Id. Medicare patients may incur costs that are different from other patients. XII-2, 65. There is some degree of flexibility in cost accounting, and some facilities are able to obtain a medicare reimbursement greater than the average cost per day for the entire facility. XII-2, 49-50, 64, 85. Charter Tampa presented expert opinion that MMHC will receive 90 percent of its projected cost from Medicare. XII-2, 52. A loss of 10 percent of costs would result in a loss of about $39,000 in net revenue. XII-2, 56. It is unclear from Charter Tampa's expert's opinion, however, whether the 90 percent figure was 90 percent of what a free standing hospital would submit to Medicare, or 90 percent of average daily costs for the entire facility. If his opinion were the former, it may not be inconsistent with the opinion expressed by the expert for MMHC. MMHC's expert testified that although some costs submitted to Medicare may be disallowed, other costs may be approved, and the total approved cost still may be greater or the same as the average daily cost for the facility (and all patients) as a whole. See the preceding paragraph. The second estimated deduction from gross revenues associated with the 27 hospital licensed beds is a deduction of $268,038 for bad debt for the second year of operation. Appendix A, MMHC Ex. 2. The bad debt estimate concerns the insured patients, other than Medicare, and some private pay patients. The estimate of bad debt is based generally upon the assumption that a small portion of private paying patients will not pay part or all of what is billed, and a more substantial portion attributed to a failure of the patient to pay the co- payment or deductible after insurance has paid its portion of the bill. VI- 2, 19, 78. The bad debt estimate is about 10.8 percent of total gross revenues for the 27 hospital licensed beds in the second year of operation. VI-2, 78, 19. The 10.8 percent is about 20 percent of the revenues generated by the 48.2 percent of patients who have insurance. Table 7, MMHC Ex. 2; VI-2, 80. The assumption was not that all insured patients would fail to pay their 20 percent share, VI-2, 79, but rather that some private pay patients would fail to pay some portion of their charge, combined with a failure of insured patients generally, but not always, to pay their co-payments or deductible. VI-2, 79-80. There is credible expert opinion in the record supported by the analysis in the preceding paragraph that the estimate of bad debt is reasonable. VI-2, 80. That expert opinion is further corroborated by Charter Tampa Ex. 12, which is the Report of the Hospital Cost Containment Board for 1984. That report assigns to short term psychiatric hospitals the code "4C." The following hospitals thus are listed by the Hospital Cost Containment Board as short term psychiatric hospitals, and report for 1984 the following bad debt percentage of patient charges: Bad Debt Percentage 4C Hospital of Patient Charges Brevard MCH 21.5 Ft. Lauderdale Hospital 2.7 Hollywood Pavilion 11.5 Charlotte Medical Center 5.1 Highland Park Medical Center 2.2 P. L. Dodge Memorial Hospital 5.9 St. John's River Hospital 2.4 Fla. Alcoholism Treatment Center --- Northside Community Mental Health Center 6.8 Tampa Heights Hospital 6.5 Lake/Sumter CMHC --- Charter Glade Hospital 3.2 Lake Hospital of the Palm Beaches 3.1 45th Street CMHC 12.3 Camelot Care Center, Inc. 2.5 Horizon Hospital 10.5 Medfield Center 3.8 Indian River CMHC 10.0 Sarasota Palms Hospital 1.7 West Lake 4.1 It is concluded, therefore, that the estimate of bad debt in the second year of operation is reasonable. The final deduction estimated from gross revenue for the 27 hospital licensed beds is a deduction of $494,947 for indigent care. Appendix A, MMHC Ex. 2. The basis for this deduction is an expectation that MMHC will be able to collect only 10 percent of the $549,941 to be billed to private pay patients. Table 7, MMHC Ex. 2; VI-2, 77, 20-21, 22. MMHC plans to bill these private pay patients, II-2, 36, and the bill will not be on a sliding scale. VII-2, 40. Nonetheless MMHC considers most of such billings to be charity or indigent care and will not expect to collect 90 percent of such billings. II-2, 37. Since the gross revenues to be billed to private pay patients is based in the second year of operation upon an average charge per day of $313, the 10 percent collection estimate is an estimate that about $30 per day per patient will be collected. Currently in the other licensed CSU and detoxification beds MMHC is only able to collect at most about 20.5 percent of overall gross revenues. VI- 2, 76. The record does not contain precise evidence as to current fees in the other licensed beds, but it may be concluded that such current fees are very roughly $100 per day for the CSU, substance abuse, and detoxification beds. VII-2, 36, II-2, 12. Thus, it is inferred that currently MMHC collects very roughly $20 per patient day in these beds. If MMHC were able to collect only $20 per day from the 1757 patient days identified in Table 7, MMHC Ex. 2, as being the second year patient days attributable to private pay patients, it would collect approximately $17,000 less net revenue than is now shown in Appendix A, MMHC Ex. 2. It is difficult to tell, on this record, whether it is more likely that MMHC will continue to collect about $20 per patient day from these patients, or whether the enhanced services will attract a few more private pay patients who will pay proportionately more of their bills, thus making the $30 per patient day estimate more reasonable. To complete the estimate of revenues, it was estimated that the "other licensed" beds, crisis stabilization, detoxification, (and substance abuse, if option A is implemented) will generate $1,889,770 in gross revenues in the first year of operation, and $2,010,399 in gross revenues in the second year of operation. Appendix A, MMHC Ex. 2; V1-2, 12-13, 21-22, 82-83. The net revenues for the other licensed beds are based upon current use rates for current Manatee County population applied to the estimated future Manatee County populations in the first and second years of operation. VI-2, 81-82. The assumption is that the current indigent patients served in these other licensed beds will continue to be served and keep pace at the same rate as the population of Manatee County grows. Id. To reach net revenues for these beds, the current Baker Act and Myers Act funding for these beds was analyzed and used as the expected basis for revenues. These expected revenues were inflated forward at 5 percent a year. Id. Additionally, a few patients were estimated to continue to be served in these beds who did not qualify for Baker Act funding, and it was estimated that only 10 percent of the gross revenues would be collected from these patients. VI-2, 82-83. See also VI-2, 21-22. As a result of these deductions from gross revenues for indigent care, it is estimated that the other licensed beds will generate $1,052,636 in net revenues in the first year of operation, and $1,105,789 in net revenues in the second year of operation. Appendix A, MMHC Ex. 2. These estimates are reasonable. Projected Expenses The forecast statement of revenue and expenses contains estimates of expenses in several categories: salaries and wages, benefits, non-salary expenses, depreciation, and general and administrative expenses. MMHC Ex. 2. The projected annual salaries are found on Table 11, MMHC Ex. 2. These projected annual salaries are based upon and reflect current salaries, and are inflated by 6 percent for each year beyond the current year. VI-2, 91-94, 110, VII-2, 118-119, IX-2, 21-22, 27-28; MMHC Ex. 4. An inflation rate of 6 percent annually is reasonable. VII-2, 119. The salary levels, based upon current experience and retention, plus state classification plan salaries for positions which do not yet exist, and compared to mental health centers in the state by an expert, are reasonable. IX-2, 27-28, VI-2 95-110. It was stipulated that adequate and qualified staff will be obtained. Finding of fact 47. Salary expense is allocated on Appendix A, MMHC Ex. 2, between the hospital licensed beds and the other licensed beds based upon the ratio of total patient days projected for each group of beds. VI-2, 23-24. The total salary expense projected for the second year of operation is $1,229,871. The expense for benefits associated with salaries is reasonable. It is based upon current MMHC experience and is 24 percent of total salaries. VI- 2, 24. The benefit expense is $295,169 in the second year of operation. Appendix A, MMHC Ex. 2. Non-salary expense are projected to be $457,512 in the second year of operation. Appendix A, MMHC Ex. 2. This expense is projected to be 30 percent of the projected expense for salaries and benefits. VI-2, 25, 112. A ratio of 30 percent has been the actual experience of MMHC for the eight months from July 1985 through February 1986. VI-2, 117. Glen Oaks is currently providing three of the four services that it will provide if the certificate of need is granted: crisis stabilization beds, detoxification beds, and substance abuse beds. VI-2, 127-28. The non-salary expense for the new beds (which primarily will be the 17 hospital licensed psychiatric beds since substance abuse is already being provided) should be quite similar to the non-salary expenses currently being incurred for the crisis stabilization beds. VI-2, 115. The primary new expense with the addition of the new beds will be salary expenses. VI-2, 119. The addition of the new beds will result in the addition of more treatment therapies which are staff intensive, but does not generate non-salary expense to any unusual degree. VI-2, 122, 140. At the same time, the current non-salary expense contains certain substantial fixed expenses, such as utility costs, which will not increase with the increase of more staff, and in that sense the use of a 30 percent figure is conservative. VI-2, 118-119, III. Thus, the estimate that non-salary expenses will be 30 percent of the expenses for salaries and benefits is reasonable. VI-2, 127-128; XII-2, 42-43. The next projected expense is a depreciation expense of $89,280 for the first and second years of operation. This expense is based upon a 30 year straight line depreciation of the "total project costs" shown on page 57 MMHC Ex. 2. VI-2, 26 There is no evidence to suggest that this expense estimate is unreasonable. Since the building was funded not by borrowing and by revenues from charges but from a Legislative appropriation, is not altogether clear that MMHC would have to reserve $89,000 annually to replace the facility at the end of 30 years. Thus, addition of this expense is conservative. VI-2, 26. Finally, in the second year of operation it is estimated that general and administrative expenses will be $314,953. Appendix A, MMHC Ex. 2; VI-2, 27. These are expenses related to support functions provided by management. Id. The estimate is based upon current budget plus increase in staff projected in the project. Id. There is no evidence to suggest that this estimate is unreasonable, and thus it is found to be reasonable. Dr. Howard Fagin testified as an expert for Charter Tampa concerning ratios derived from data contained in reports to the Hospital Cost Containment Board. The data relied upon by Dr. Fagin was the actual financial experience of 16 free standing psychiatric facilities in Florida for 1984, which was the latest compilation of such data. XI-2, 41, 94. The Hospital Cost Containment Board category for "salary and wages" did not include "benefits." These were included under the "other" category. XI-2, 39. Thus, Dr. Fagin calculated a ratio of all expenses other than "salary and wages" divided by "salary and wages" for each of the 16 free standing psychiatric facilities. XI-2, 41. That average percentage was 132 percent. He made the same calculation for only the licensed beds portion of the estimated salaries and other expenses in Appendix A, MMHC Ex. 2, for the second year of operation and found that to be 94 percent. XI-2, 40. (Had he computed the ratio for the total for both licensed and so- called "unlicensed" beds, it would have been the same 94 percent.) Ms. Deborah Krueger testified as an expert for MMHC. Ms. Krueger testified that there were 18 free standing psychiatric hospitals in Florida in 1984, but that 4 of these were community mental health centers. XII-2, 45. Ms. Krueger then did the same calculation as was performed by Dr. Fagin, as discussed in finding of fact 104, but limited to the 4 community mental health centers. The average was 81.3 percent. Brevard was 96.5 percent; Palm Beach 45th Street was 78.4 percent; Hillsborough was 87.9 percent; and Lake Sumter Community Mental Health Center was 78.4 percent. XII-2, 46. Ms. Krueger also did the same calculation for the remaining 14 free standing psychiatric facilities that were not community mental health facilities and that ratio was 132 percent. The ratio used by Dr. Fagin and Ms. Krueger is one that increases as the "other expenses" category becomes greater in relationship to salaries and wages. Thus, the lower the ratio, the smaller the "other expenses" in comparison to salaries and wages. Comparisons such as those performed by Dr. Fagin and Ms. Krueger are useful as secondary modes of analysis, but are not as useful or reasonable as the actual recent experience of Glen Oaks facility itself. XII-2, 39, 43; VI-2, 143-144. Without more detailed information concerning the actual cost behavior and cost structure of the other existing facilities, it is difficult to draw conclusions from the comparisons offered above in finding of fact 104 and 105. However, of the two comparisons, the one done by Ms. Krueger is more relevant. It appears that the 132 percent ratio obtained by Dr. Fagin was either of all free standing facilities or of only the free standing psychiatric facilities that were not community mental health centers. Dr. Fagin did not state whether the 16 facilities chosen included community mental health centers. XI-2, 41. It is probable from the testimony of Ms. Krueger that Dr. Fagin's 16 facilities did not include community mental health centers, and thus his testimony, summarized in finding of fact 104, is irrelevant. Dr. Fagin's testimony is less reliable than Ms. Krueger's for the further reason-that it may be inferred that the cost structures and cost behaviors of the four community mental health centers in Ms. Krueger's analysis would be much more comparable to the facility proposed by MMHC than the aggregate of facilities contained in Dr. Fagin's analysis. Ms. Krueger's testimony, summarized in finding of fact 105, is secondary and corroborative evidence that the projected expenses (other than salaries and wages) of MMHC for the second year of operation of the total project, as well as for the hospital licensed beds, is reasonable and conservative. This is especially true with respect to the comparison to the Brevard Community Mental Health facility, which had a ratio of other expenses to salaries of 96.5 percent, almost the same as that projected for MMHC. The Brevard facility operates inpatient programs in much the same setting and manner as proposed by MMHC. IX-2, 37-38, 43-45, 48, 64. See finding of fact 68. MMHC intends to contract with David Feldman and Peat, Marwick Co. Mr. Feldman will assist with reporting such things as Medicare matters, reports to the Hospital Cost Containment Board, and the like. I-2, 81. Mr. Feldman and Peat, Marwick Co. also would work on establishing charges for services. I-2, Peat, Marwick Co. also would be assisting in pricing, budgeting, and reporting. II-2, 50. Mr. Feldman's services might cost about $720 or less since he might donate some time. II-2, 11. The costs of Peat, Marwick Co. are not known. II-2, 50. Neither cost has specifically been made a part of the estimates of expenses in the first or second year of operation. Long Term Financial Feasibility Conclusions Although contrary findings of fact have been made in the preceding paragraphs concerning the issues which follow, it is useful to look at the effect of the possibility that estimating errors are contained in Appendix A, MMHC Ex. 2. If Dr. Fagin were correct that MMHC would obtain only 90 percent of costs for Medicare reimbursement, this would result in a loss of $39,000 in revenue. Finding of fact 88-90. If Ms. Krueger were wrong, and Appendix A in fact contained rounding errors, this would mean an increase in salary expenses of $6,369. If indigents in fact will pay less than 10 percent for services in the hospital licensed beds, this would result in a loss of $17,000 in revenue. Finding of fact 95. If 2 percent of all estimated patient days would be lost to a facility like MMH because of dual medical/psychiatric diagnosis, this would result in a loss of 158.1 patient days out of 7,905 in the second year of operation, or a loss of revenue of $49,485 at $313 average per patient day. And if accounting firm expenses are left out of the estimate of future expenses, perhaps this may be $5,000 annually. Adding these figures (since a loss of revenue or a gain in expenses is the same thing as far as net income is concerned), net income in the second year of operation would be less by $116,854, which would result in a net operating loss in the second year of operation of $30,476. To recoup this loss and break even, MMHC would need only to raises its average charge per patient day by $3.93. This is calculated by dividing the net operating loss, $30,476, by the number of patient days, which would be 7905 less 2 percent, or 7746.9 patient days. Even making the assumptions in finding of fact 109, MMHC might still have net revenue at the end of the second year of operation if the depreciation expense, finding of fact 102, is not needed. But assuming that the $89,000 depreciation expenses is needed, and making the hypothetical assumptions of finding of fact 109, MMHC would still break even if it simply increased its average daily charge per patient from $313 to $317. The projected average charges of MMHC of $295 and $313 per patient day are lower than charges for similar services available to patients in the service area of MMHC. VI-2, 147. In 1986, Charter Hospital of Tampa Bay's 1986 budget filed with the Hospital Cost Containment Board reported gross revenue per adjusted patient day of $433. VI-2, 43. In 1984, the average gross revenue per patient day for MMH's short term psychiatric beds was $304. VI-2, 42. A reasonable inflation rate for that statistic would be 5 percent annually. VI-2, Thus, it may be inferred that the average gross revenue per patient day at MMH for its 25 short term psychiatric beds will probably increase to about $370 by 1988, if not more. (The same figure at Charter Tampa increased 17 percent in only two years, 1984 to 1986. VI-2, 43.) Thus MMHC could raise its per patient average daily charge by $4 in 1988 and easily remain competitive. MMHC annually has the fiscal goal of breaking even, with perhaps some small surplus. See finding of fact 19. Thus, long term financial feasibility must be considered with that goal in mind. Upon consideration of findings of fact 34 through 111, the project proposed by MMHC is financially feasible in the long term. Long term financial feasibility exists whether MMHC chooses option A or option B. VI-2, 10. The hospital license beds, as well as the entire facility at Glen Oaks, should realize some net income both the first and second years of operation and thus at least operate without net loss. Standing of Intervenors Charter Hospital of Tampa Bay is a wholly owned subsidiary of Charter Medical-Southeast, Inc. X-2, 34. It was purchased in April 1985. X-2, 54. Charter Tampa has 146 hospital licensed short term psychiatric beds, and no hospital licensed substance abuse beds. X-2, 24, 62. Geriatric patients are treated in the adult unit of Charter Tampa. XI-2, 117. Charter Tampa is located in Hillsborough County, Tampa, Florida. X-2, 24. Charter Tampa considers Hillsborough County to be its primary service area. X-2, 55. In the ten months preceding July 1986, Charter Tampa's administrator estimated that Charter Tampa had served approximately ten patients from Manatee County. X-2, 29. Records of Charter Tampa reviewed by Charter Tampa's expert indicated that in a six month period Charter Tampa had served seven patients who were Manatee County residents. XI-2, 76. Charter Tampa's expert thus offered the opinion that 14 such patients were being served now by Charter Tampa annually, and that from 5 to 10 of these patients would be lost to MMHC if this certificate of need were to be granted. XI-2, 76. The expert stated that this loss would be a financial loss, but was not asked to give an opinion as to the amount of the loss. Id. Charter Tampa's administrator stated that he thought the loss would be $150,000 annually. X-2, 32. The record does not contain an explanation as to the estimate of a $150,000 loss was projected. The ages, sex, or types of treatment received by the patients that made up the ten patients served in that last ten months were not known. X-2, 50, 64. The origin of the patient was estimated by the origin of the person who guaranteed payment, but it was estimated that this was the same person as the patient in 90 percent of the instances. X-2, 60-61. Charter Tampa has had one psychiatrist for the last four months on temporary staff privileges who has an office or residence in Manatee County. X- 2, 51-52. That physician is involved in establishing an outpatient clinic for Charter Tampa in Manatee County. X-2, 81. Charter Tampa's formal list of physicians having staff privileges at Charter Tampa has four categories of staff privileges: active, courtesy, consulting, and affiliate. As of May 1986, Charter Tampa's physician staff in these four categories almost exclusively had offices in Tampa. None of the physicians having staff privileges at Charter Tampa had an office in Manatee County. MMHC Ex. 5; X-2, 53. Charter Tampa did not know any physicians, including the physician involved in setting up the outpatient clinic, who is residing in Manatee County and would admit patients to Charter Tampa in the future. X-2, 55, 81. Charter Tampa's administrator did not have any certain knowledge as to the numbers of patients from Manatee County that might be treated by Charter Tampa in the future. X-2, 51. The administrator of Charter Tampa had not reviewed the application materials of MMHC and did not know anything about the history of MMHC or the services it had been providing to the date of the final hearing. X-2, 61-62. Charter Tampa supported the effort of Charter Haven to obtain comparative review of a would-be competing application for the same services in Manatee County. I- 1, 58. The estimated impact of a loss of $150,000 in gross revenues annually is clearly overstated by Charter Tampa. The record in this case shows that the normal length of stay for short term inpatient hospital psychiatric patients is between 10 to 14 days. See findings of fact 59, 61-62. Since Charter Tampa serves geriatric patients such as MMHC proposes to serve from its GRTS program, it is reasonable to infer that the average length of stay of the 5 to 10 patients served now from Manatee County by Charter Tampa is about 14 days. Finding of fact 59. It is also reasonable to infer that the probable average gross revenue per patient day at Charter Tampa for these 5 to 10 patients is about $477. (This is the budgeted 1986 figure inflated twice at 5 percent. Finding of fact 111.) Thus, the estimated loss of 5 to 10 patients is an estimated loss of 70 to 140 patient days annually, or a projected loss of only $33,390 to $66,780 in gross revenues annually. If this loss were true, this would probably constitute substantial interest. The outpatient clinic that Charter Tampa intends to open in Manatee County will not serve inpatients. Moreover, it will serve mostly patients who will personally pay for services X-2, 62. Thus, it would not be serving patients that MMHC now serves. In sum, the intended outpatient clinic would not compete with or be substantially affected by the operation of inpatient hospital beds by MMHC as proposed in its application. XII-2, 28. Based upon findings of fact 113 through 120, it is further found that Charter Hospital of Tampa Bay will not be substantially affected by the grant of the certificate of need at issue in this case. The most that Charter Tampa estimates that it might lose is about 140 patient days annually. See finding of fact 120. But Manatee County will still have an unmet need of 27.4 short term psychiatric beds by the second year of the operation of MMHC's proposed beds. See finding of fact 65. On an annual basis (365 days) this is 10,001 patient days that will not be served by MMHC. Even if this residual unmet need were only 4,700 to 6,200 patient days as was thought by MMHC's expert, III-2 86-87, there is still a very substantial residual unmet need in Manatee County to be served by Charter Tampa. It is not believable that Charter Tampa will lose a mere 140 patient days with so many days of unmet need. This is especially true since Charter failed to persuasively identify the Manatee County patients that it would lose, or to identify the reasons that such patients would be lost. See findings of fact 113 through 118. It was stipulated between MMHC, MMH, and HRS, but not Charter Tampa, that MMH has standing (a substantial interest) to contest the issuance of the proposed 17 short term hospital psychiatric beds to MMHC as an existing provider of the same services. It was further stipulated by the same parties that MMH has no short term or long term substance abuse beds. X-2, 82-85. Charter Tampa put on no evidence contrary to these stipulations, and therefore the stipulations are accepted as fact in this record. Appendix A which follows contains specific rulings upon all proposed findings of fact which have been rejected. In some cases Appendix A contains discussions and further findings of fact. Those findings of fact in Appendix A are adopted by reference as findings of fact in this recommended order.
Recommendation Upon consideration of the foregoing, it is recommended that the Department of Health and Rehabilitative Services issue its final order: Dismissing the petitions for intervention of Manatee Memorial Hospital and Charter Hospital of Tampa Bay to the extent that such petitions seek to contest the grant of a certificate of need to the Petitioner for short term substance abuse beds. Granting certificate of need number 2681 to Manatee Mental Health Center, Inc., d/b/a Manatee Crisis Center to operate 17 short term inpatient hospital psychiatric beds and 10 short term inpatient hospital substance abuse beds. DONE and ORDERED this 3rd day of December 1986 in Tallahassee, Florida. WILLIAM C. SHERRILL, JR. Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 FILED with the Clerk of the Division of Administrative Hearings this 3rd day of December 1986. APPENDIX A TO RECOMMENDED ORDER IN DOAH CASE NUMBER 84-0988 The following are rulings by number upon all proposed findings of fact which have been rejected. Findings of fact proposed by Manatee Mental Health Center, Inc., d/b/a Manatee Crisis Center: 7. The record cited, 11-2, 85, does not support the conclusion that the 18 residential beds are not a part of the "necessary" continuum of care offered by MMHC. A finding of fact has been made that these beds are not a part of the treatment program of MMHC. 16. The implication in the last sentence that the project would provide "necessary licensed hospital services at very little cost" is rejected as not supported by the evidence. Without evidence on the point, the "position" of HRS is irrelevant. The second sentence is irrelevant since it refers to the 1985 local health plan. See the conclusions of law and discussion with respect to finding of fact 14 proposed by MMH. 21.i. This proposed finding of fact seeks a finding that the "optimal" occupancy rate is 75 percent. The record does not contain sufficient evidence to make that conclusion. The remainder of this proposed finding of fact has been adopted. 21.k. This proposed finding of fact is accounted for by the numeric rule, which is based upon population, and thus is cumulative. 24. The reference to the 1985 local plan is irrelevant. See proposed finding of fact 14 by MMH. 27-28. These proposed findings rely upon SIRS Ex. 1. HRS Ex. 1 relies upon an average length of stay of 14.3 days to 14.5 days. (This is mathematically obvious by dividing the projected number of patient days in each of the three projections by the number of admissions projected in each case.) While it is reasonable for MMHC to project an average length of stay of 14 days, this is so due to the fact that MMHC will have a substantial number of GRTS patients in its short term psychiatric beds. See findings of fact 57-59 and 61. The record does not contain, however, enough evidence to conclude that the average length of stay for all short term psychiatric patients in Manatee County will be 14 days. See VIII-2, 49-52. Indeed, the witness seems to have believed that the calculation in HRS Ex. 1 used an average length of stay of 9 days, but as discussed above, the math in HRS Ex. 1 is to the contrary. For this reason, and finding based upon HRS Ex. 1 is rejected. 29. Rejected because not in the record cited as proposed in this proposed finding of fact. I-1, 58. The last sentence with respect to projected occupancy levels of 85 percent on the average for the third year is rejected because not supported by the evidence. The witness did not so testify, and the exhibit cited does not provide average occupancy for the third year. This proposed finding is rejected since the average occupancy level of 85 percent for the third year is rejected in the preceding paragraph. 43. The conclusion that private physician referrals will be a bonus is rejected since the projection of 80 percent occupancy requires an increase in occupancy in the short term psychiatric beds from 8 to 12.6 beds from the first to second years. See finding of fact 65. The projection of an average daily census of 8 short term psychiatric patients was based solely upon patients currently within the MMHC system. See findings of fact 57 and 60. Thus, the increase of an average daily census to 12.6 in the second year must come in part from new patients referred by private physicians. This is not a bonus, but a necessary part of the projections of MMHC to reach 80 percent occupancy. Sentences three through five are rejected as cumulative and unnecessary. The fourth sentence is rejected as not relevant and inconclusive for lack of evidence of context. 58. This proposed finding of fact is irrelevant since these issues have been the subject of a stipulation removing them from dispute in this case. 59-64. These miscellaneous operational and managerial proposed findings of fact are not relevant. The Department of Health and Rehabilitative Services does not propose to deny the certificate of need with respect to these issues, and the simultaneously filed proposed findings of fact of the two Intervenors do not propose any facts concerning these issues. Thus, these issues are not in dispute in this case. The second sentence is cumulative and not relevant. This proposed finding of fact, as stated in the first sentence, is not disputed and thus not relevant. Findings have been made concerning the two options as this might affect the proposed number of beds sought. 81-82. It is true that MMHC currently has a sliding fee scale for determining how much certain impecunious patients will have to pay. It is also true that the updated application erroneously states that a sliding scale will be used if the certificate of need is granted. But expert witnesses relied upon the existing sliding fee scale only to project the portion of a hypothetical gross revenues which is currently being collected from patients receiving charity care. VII-2, 79. Thus, the error did not affect the reliability of testimony. No party has raised any of the foregoing as an issue. For these reasons, the matter is not relevant. 90. All sentences beyond the first sentence are mathematically correct, but are cumulative and unnecessary. 95. This proposed finding of fact is rejected because the 1983 local health plan does not contain the matter stated, the updated application is hearsay, and all plans other than plans in existence when the application was filed are not relevant. 97-98. To the extent not already adopted, these proposed findings of fact are rejected as cumulative and unnecessary. 101. Opponents of the application of MMHC in proposed findings of fact have not proposed that an entirely new free standing psychiatric hospital would be a preferable alternative to the application of MMHC. Dr. Fagin testified that bed need in "the community . . . is best served by a new freestanding facility." XI-2, 74. He then contradicted that testimony by testifying that "I said that two of the best alternatives are approval of this project or disapproval of this project and maintenance of the existing programs at the Manatee Mental Health Center." XI-2, 116. Thus, the first sentence of this proposed finding is rejected for lack of support in the record. Finally, if the issue had been raised, at least facially it is true that the MMHC proposal appears to be less costly because it already has a building and a new project would have to pay for a new building by increased fees. But there is a cost to Florida taxpayers through public funding of the MMHC building which should be considered as well. The record is insufficient for such comparative review. The last sentence is rejected since about 90 percent of the time the guarantor and the patient are the same person. The fourth sentence is rejected because based upon a deposition taken earlier in time, and the deposition itself is not in evidence. The third sentence is irrelevant. 111. The second sentence is irrelevant. The second sentence is not supported by the record. The record shows that the parent company receives or would receive revenues from all subsidiaries, whether existing or proposed. The last sentence is rejected because not relevant: no party has argued that Charter Tampa is an adequate alternative to the proposal of MMHC. The corporate motives of the parent corporation are not relevant to the issue of the standing of Charter Tampa. The issue of standing of Charter Tampa must be considered upon evidence it presented concerning its substantial interest, as well as evidence submitted by other parties. Thus, this proposed finding is not relevant. Not relevant since the corporate motives of the parent are essentially not relevant. Not relevant as stated with respect to proposed finding of fact 117 and not supported by the record. The last two sentences are not relevant. Findings of fact proposed by Manatee Hospitals and Health Systems, Inc., d/b/a Manatee Memorial Hospital: The proposed findings that social setting detoxification would be eliminated are rejected because contrary to the testimony cited. 11-2, 18-19. Findings with respect to the minimum residential beds are found in findings of fact 12 and 31. A finding that the current rented minimum residential beds are a part of the MMHC treatment program is rejected as contrary to the evidence as discussed in those findings. This proposed finding is a statement of law and a procedural statement. The proposed finding that the 1983 local health plan found no need for psychiatric and substance abuse beds for District VI is rejected. The plan found a need for substance abuse beds by 1988 (57 such beds) but no need for short terms psychiatric beds. MMHC Ex. 1, p. 53, 53-55. Any reference in this case to any local plan other than the 1983 local health plan, MMHC Ex. I, is legally incorrect and irrelevant. The amended application of MMHC only refers to the 1983 local health plan. See findings of fact 29 and 30, order of May 14, 1986, Appendix B herein. SIRS can only review an application for certificate of need against the specific local health plan cited by the application. NME Hospitals, Inc., d/b/a Delray Community Hospital et al. v. Department of Health and Rehabilitative Services, 492 So.2d 379, 385- 386 (Fla. 1st DCA 1986). Thus, the proposed finding must be rejected as irrelevant. Rejected as argument of law. Rejected because this plan was not in existence when the applicant filed its application, the applicant has not upon this plan for its application, and therefore, as discussed with respect to proposed finding of fact 14, the proposed finding is legally irrelevant. It is also rejected because irrelevant to this application: the application is for short term inpatient hospital psychiatric and substance abuse services; the application does not result in the loss of existing ARTS or EGRT programs, nor does it result in the loss of a formal treatment program of residential beds. See proposed finding of fact II above. Rejected as legally irrelevant for the reasons cited with respect to proposed finding of fact 14. Rejected for the reasons stated with respect to proposed findings of fact 11, 14, 15, 16, and 17. Sentences 3, 4, and 5 are rejected for the reasons stated in response to proposed finding of fact 18. 21. The second sentence concerning average lengths of stay at MMH must be rejected because the Hearing Officer has been unable to find the proposed finding in the record cited. The 1985 local health plan, CH Ex. 8, provides that in 1984, MMH had an average length of stay for adults in psychiatric beds of 11.0 days and 8.0 days for children. P. 120. The plan also states that non- hospital licensed crisis stabilization units are used lieu of hospital beds for stays less than 7 days, but that licensed hospitals provide more intensive service and the average length of stay can average 14-16 days. It is probable that data in a post-application local or state health plan can be utilized by the parties at a formal administrative hearing, so long as such use does not conflict with rule or statute. If data were to be relied upon from the 1985 District VI Local Health Plan, the above data supports the findings in the recommended order (finding of fact 61) that the average length of stay projected for most patients in the 17 short term psychiatric beds will be 10 to 14 days once the more intensive individual therapies are added to the inpatient program at MMHC. The third sentence in this proposed finding of fact is rejected. The high occupancy rates at MMH only show that MMH is near lawful capacity; it does not show that need in Manatee County is being adequately served by MMH, and indeed, the inference is to the contrary. Finally, the drop to 88 percent must be considered in relation to the prior rates and the rise again in the first four months of 1986. It does not show a clear or reliable diminution of need. 23. Rejected by finding of fact 43. The first sentence is rejected. The existence of CSU beds at MMHC would not be argued by MMH to be an adequate alternative to its own application for expanded hospital licensed beds. Moreover, the proposed application does not diminish the current CSU program at MMHC. That program will continue. The proposed findings that charges will increase and that the sliding fee scale for those unable to pay will be eliminated have been rejected by finding of fact 46. The finding that the proposed project would not be financially feasible is rejected by finding of fact 112. Evidence was introduced that services would be improved through shared resources. Specifically, benefits would be achieved by providing continuous care for patients within the MMHC system and indigent patients in the other licensed beds at Glen Oaks would benefit from expanded therapies. See findings of fact 26, 28, 29, 30, and 33. Thus, this finding of fact is rejected. It is true that no evidence was introduced services existing in counties other than Manatee County were reasonably close and accessible for patients and families in Manatee County. Without such evidence, it cannot be concluded that "services are available in Hillsborough and Pinellas Counties" as proposed in this finding of fact. The proposed finding of fact is therefore rejected. The proposed finding is true and irrelevant. The fourth sentence is rejected as discussed with respect to proposed finding 27. See also findings of fact 2-26, 31, and 46. The eighth sentence is rejected since the applicant projects, reasonably, that its services to financially and medically indigent persons will continue in the non-hospital licensed beds and will increase as Manatee County population increases. The finding with respect to the sliding fee scale is rejected by finding of fact 46. The next sentence is rejected as discussed above in the first sentence of this paragraph. The last sentence is rejected by finding of fact 46. This second proposed finding is a narrative summary and is contained by separate issue in the findings of fact. The second sentence is rejected because MMHC records show that about 7 inpatient hospital admissions per month are made from MMHC outpatient programs, but it was estimated that only 2 of these per month would be retained by the MMHC hospital licensed beds. Finding of fact 57. The remainder of this proposed finding of fact is rejected for the reason stated in finding of fact 69. The fifth sentence is rejected because it is not the testimony of Ms. Wolchuck-Sher. It is only the hearsay statement from someone in a deposition characterized by Ms. Wolchuck-Sher without evidence of the context of the statement of the deponentor the reliability of Ms. Wolchuck-Sher's memory on the point. XII-2, 33. The remainder of this proposed finding of fact is rejected for the reasons discussed in finding of fact 68. The second sentence is rejected because the word calculated" in the question is unclear and the response is contrary to the record. Average lengths of stay were estimated based upon studies discussed in findings of fact 57 through 62. The third sentence is rejected because the testimony clearly indicates that the average lengths of stay were based upon a review of actual experience plus assumptions concerning an increase of average length of stay to about 10 days in the psychiatry beds to more closely approximate the average length of stay of MMH. See findings of fact 57 through 62. The sixth sentence is rejected for the reason discussed in findings of fact 57, 58, 59, and 62. The ninth and tenth sentences are rejected because there is no evidence to conclude that MMHC will not continue to serve an average daily census of 9 patients in its substance abuse beds. The remainder of the proposed finding of fact has been rejected in findings of fact 57 through 62. The first two sentences are rejected for the reasons stated in findings of fact 57 through 62. The third sentence is rejected because the financial projection of MHC estimate that the CSU beds will continue to operate as before, generating the same revenues. See finding of fact 96. This estimate implicitly assumes the same number of patients served and the same average length of stay of 6.5 days, not 10 days. VI-2, 81-82. The 10 day average length of stay only applies to the hospital licensed psychiatric patients, other than geriatric psychiatric patients. See findings of fact 57 through 62. The remainder of this proposed finding of fact is rejected because contrary to the underlying facts found in findings of fact 57 through 62 and 96. This proposed finding of fact has been rejected in findings of fact 88 through 90. The second sentence is rejected because the current collection rate is roughly 20.5 percent of gross revenues in the CSU and detoxification beds. VI- 2, 76. The estimate of 10 percent in the 27 hospital licensed beds was due to the fact that overall gross revenues for the hospital licensed beds would increase to about $300 per patient per day. Id. The remainder of the proposed finding of fact is partially adopted in findings of fact 109 through 112. The loss of $17,000 in gross revenues, considered by itself, would be within the projected net revenue for the second year of operation; the project still would end the year with positive net revenue. The fifth sentence in this proposed finding of fact is rejected. VI- 2, 112, 125. The sixth sentence is true but irrelevant. While it would be a better method to estimate non-salary costs by estimating each component thereof separately, the Petitioner need not present the best method. The method presented by the Petitioner, using actual historical data from MMHC, is reasonable. See finding of fact 100. MMH might have presented an estimate by each separate component, but it did not. All of the rest of this proposed finding of fact must be rejected. The reasons that Ms. Krueger gave for rejecting as unreliable non-salary to salary expense ratios in other MMHC programs were: that such programs were not the same as the inpatient programs contemplated in this application, VI-2, 126, and the programs operated at the Glen Ridge facility provide an inappropriate basis for comparison because the Glen Ridge facility in 1984 was a "dump" and not comparable to the new Glen Oaks facility, VI-2, 116. These are good reasons for not making these comparisons. Next, she did not testify that there "would be changes at Glen Oaks if it became licensed" as proposed by MMH. She testified that there would be future changes expected in "the mental health center." VI-2, 139. She then testified that a change in Glen Oaks should not be expected in the next few years, and therefore use of the most recent actual data from the current operation of the Glen Oaks facility was reasonable. VI-2, 139-140. Mr. More initially testified that the salaries on Table 11, MMHC Ex. 2, "reflect" the average salaries currently paid by MMHC. I-2, 97. On cross examination, Mr. More was asked "was it your testimony that those are your current salaries," and he replied "current average salaries, yes." 11-2, 15. In rebuttal, over objection that Mr. More was impeaching his own testimony, Mr. More testified that Table 11 contains current salaries blending with inflation. IX-2, 14-15. Mr. More was never asked on cross examination whether he was sure that Table 11 did not contain inflation factors. He was merely asked whether Table 11 figures "were" current salaries. They were. They were current salaries used as a base with an inflation factor. VI-2, 91-94. There is no confusion concerning whether Table 11 contains an inflation factor. Moreover, the rebuttal testimony of Mr. More was proper given the brevity and incompleteness of cross examination. The third sentence of this finding of fact is thus rejected. The remainder of the proposed finding of fact is also rejected. The proposed finding depends upon a finding that MMHC has had salary increases since February 1986 which have not been accounted for in Table 11, MMHC Ex. 2. The record does not support that proposed finding. First, the testimony of Ms. Radcliffe was insufficient to conclude that in fact there have been 3 percent raises in salaries since February 1986; she only said possible," and said "I have no knowledge of when any raises would come due." IX-2, 23. But more important, it appears that projected raises for fiscal year 1986 were contained in the figures of "current salaries" used. Ms. Radcliffe said that she used the figures that were in the budget revised in February, 1986, and that [w]hen 1 prepared the budgets, I used the current salaries as of when I prepared the budgets, and then 1 put in a small amount on the overall budget based on people getting raises at various times during the year." Id. In sum, the "current" salaries in fact contain all the budgeted-raises for fiscal year 1986. The first sentence is rejected because the estimate of expenses was based upon a percentage method (non-salary) and current statistics (general and administrative). No expenses items were "deleted" as such. The second and third sentences are not supported by enough record evidence to make it relevant. Mr. More testified that MMHC already was producing a "TV series" that was "coming up," and that MMHC would be "continuing this kind of effort once we become a licensed hospital." Thus, to some extent TV expenses must already be accounted for in current general and administrative expenses. The only other TV comment was in the next paragraph when Mr. More mentioned timing a "TV marketing effort in with the opening of the hospital." 1-2, 94. There is no-further evidence in the record concerning the cost of such TV marketing, whether such marketing would occur only at the opening or would be ongoing, and whether the cost is significant. The sixth and seventh sentences are rejected as not relevant. The depreciation expense is somewhat unusual in this case since MMHC does not own the building. See finding of fact 102. Moreover, even if the expense in this area should increase by $2500 per year, that is effectively only $0.31 per patient day out of 7905 patient days in the second year of operation. The issue is negligible. VI-2, 46. The eighth sentence is rejected because the rounding error is not in appendix A, MMHC Ex. 2; it is probably in Table 11, MMHC Ex. 2. VI-2, 87-88. The last sentence is rejected as not relevant. Dr. Ravindrin was evidently recruited by MMHC with current resources, coming to work in 1985. V-2, 6. Dr. Ravindrin further will be the only full time physician out of the 2.4 FTE's allocated for physicians in the new staffing pattern. Finding of fact 73. As discussed in the findings of fact, current "general and administrative" expenses were used as the basis for projecting future expenses Thus, should Dr. Ravindrin leave, it is reasonable to assume that the same level of budgeted general and administrative expenses will be sufficient to recruit a replacement. Finally, the remaining physicians will only be part-time, and thus should not involve moving expenses. Moreover, all of the physicians have been identified and thus there will not be any recruitment expenses in the first few years of operation. XII-2, 39. This proposed finding of fact is a summary of proposed findings of fact which have been rejected for the reasons stated above, and thus it also is rejected for the reasons stated above. This proposed finding is not relevant for the reasons stated in the proposed finding. The first six sentences are rejected by findings of fact 25, 26, 46, 93 and 96. The proposed finding in the eighth sentence that MMHC "may actually serve fewer indigents" is rejected as not credible. MMHC will continue to serve the same number of indigents in the other licensed beds as well as some other indigents in the hospital licensed beds. See the above findings of fact. The ninth sentence is rejected by findings of fact 18, 19, 20, 26, 28, 29, and 30. The last two sentences are rejected due to all the findings of fact listed in this paragraph. The second sentence is rejected because not true. MMHC currently does not serve patients served by MMH. See finding of fact 17. The third and fourth sentences are rejected by findings of fact 38 and 41 D. Findings of fact proposed by Charter-Medical Southeast, Inc., d/b/a Charter Hospital of Tampa Bay: 6. The fourth sentence is rejected because it is an argument of law. 9. The record does not contain sufficient evidence concerning the programs conducted at Glen Ridge to conclude that it was a "clinic" then. Moreover, the record does not contain a sufficiently clear definition of a "clinic" to make this proposed factual finding. Thus, the third sentence must be rejected. 11. The third through fifth sentences are rejected because evidence to support these proposed findings of fact is not found at the place in the record cited. 15, 16, and 17. To the extent these proposed findings reference health plans adopted after the application was filed, and not cited by the application as amended, the proposed findings are irrelevant. See discussion with respect to the proposed findings of fact 14-19 of MMH. The first three sentences are rejected because the 18 minimum residential beds currently rented by MMHC are not part of a MMHC treatment program. See findings of fact 12 and 31. The next two sentences are rejected as irrelevant for this reason, and also because the referenced plans are 1985 plans. The last two sentences are rejected because the cost to patients will continue to be based upon ability to pay; the cost will not increase for those patients financially unable to pay. See finding of fact 46. In the first sentence, the phrase "as a component of those programs" is rejected because contrary to the evidence. See finding of fact 12 and 31. The remainder of this proposed finding of fact has been essentially rejected due to the findings of fact 12 and 31. The majority of this finding of fact has not been adopted since it is a statement of law. The categorical statements contained in the last two sentences of this proposed finding of fact must be rejected. Although MMHC is currently providing good care, MMHC has experienced funding stresses and the quality and continued viability of all of its services would be enhanced by obtaining an additional funding source. See finding of fact 18. If the certificate of need were granted, indigent patients in the CSU would have the opportunity to receive expanded therapies not now available to them, see finding of fact 20, although presumably available to patients having third party payor sources at MMH (which has a longer average length of stay, see finding of fact 61). The second one-half of this proposed finding of fact proposes a finding that the proposed average length of stay for psychiatric beds will be unreasonable. This proposed finding has been rejected in findings of fact 57 and 58. The first sentence is rejected as irrelevant. An applicant for a certificate of need not be in "dire financial straits" to be entitled to seek expansion of its services. In fact, an unhealthy financial condition might mitigate against the award of a certificate of need. For the same reason, the last sentence is also rejected as irrelevant. Most of this proposed finding of fact has been rejected for the reasons stated with respect to MMH proposed finding of fact 40. The eighth sentence is rejected because there is no citation to the record and because the testimony of Ms. Krueger was to the effect that it was not proper to calculate ratios for outpatient programs or Glen Ridge programs at MMHC and because the audited financial statements at pages 36-42 of MMHC Ex. 2 required extensive accounting adjustment to result in a comparable comparison. The ninth sentence (which concerns the comparisons made by Dr. Fagin to 1984 Hospital Cost Containment Board actual data) is rejected for the reasons stated in findings of fact 104 through 107. The tenth sentence is rejected because the testimony of Mr. Hackett cited is actually evidence that estimated expenses of MMHC are reasonable. Mr. Hackett testified that the "salary expense" at Charter Hospital of Tampa Bay recently was 44 percent of the total operating budget. X-2, 26. This left 56 percent for all other expenses, not for "non-salary" expenses in the sense that that is used in Appendix A, MMHC Ex. 2. In the second year of operation, MMHC projects that its "salaries and wages" expense will be $1,229,871, and that its total operating expense will be $2,386,785. Thus, MMHC projects that its "salary expense" will be 51 percent of its total operating expenses. Assuming Mr. Hackett meant "operating expenses" when he responded to the question about "operating budget," it is apparent that the MMHC estimate is reasonably the same as that currently experienced by Charter Tampa. (If "operating budget" meant net revenues, the percentage is 50 percent.) Thus, MMHC projects that its expense other than salaries and wages will be about 50 percent of all expenses, and Charter Tampa currently operates with other expenses at 56 percent of all other expenses. Charter Tampa is not a community mental health center. There is clear evidence in the record that the ratio of expenses other than salaries to salaries is much lower for community mental health centers than to free standing psychiatric facilities. See finding of fact 104 to 107. Thus, the fact that MMHC estimates that expenses other than salaries will be 50 percent of the total expenses, compared to the 56 percent ratio of Charter Tampa, is entirely consistent with that evidence. If anything, MMHC has estimated expenses other than salaries too high, and much closer to a facility like Charter Tampa. This proposed finding of fact is essentially the same as proposed finding of fact 36 by MMH and is rejected for the reasons stated with respect to that proposed finding. The following additional comments are noted. The average length of stay was not assumed to increase in the CSU: it implicitly remained the same since estimated revenues remained the same. The average length of stay overall for the 17 hospital licensed psychiatric beds was 14 days, but this was a mix of 10 day average lengths of stay for some patients, and 20 day average lengths of stay for elderly patients. The average length of stay at MMH is established at about 10 days by testimony. VI-2, 72. See also discussion related to MMH proposed finding of fact 21. The assumed average length of stay in the hospital licensed substance abuse beds was never tied to patient days or fiscal projections; instead, MMHC simply estimated a continued average daily census of 9 patients, which is current experience and is reasonable. Improved treatment logically will lengthen the average length of stay since the improved treatment involves greater individual attention, education, and exploration of causes of the acute psychiatric episode. While improved treatment might shorten the length of stay for a long term patient, it surely will lengthen the average length of stay for a patient who has only been an inpatient for a few days to stabilize an acute crisis. Rejected because the underlying proposed finding of fact 32 concerning average length of stay has been rejected. Rejected for the reasons stated in rejection of MMH proposed finding of fact 39. Rejected for the reasons stated in findings of fact 68 and 69 and as discussed in rejection of MMH proposed findings of fact 34 and 35. The portion of the proposed finding concerning dually diagnosed patients also has been determined to be irrelevant in findings of fact 109 through 112. Rejected for the reasons discussed in rejection of MMH proposed finding of fact 41, and irrelevant for the reasons stated in findings of fact 109-112. Rejected by findings of fact 88 through 90. Rejected for the reasons discussed in response to proposed finding of fact 42 of MNH. Rejected by finding of fact 112. To the extent that the second sentence proposes a finding of fact that Charter Tampa "directly serves" Hernando and Pasco Counties, it is rejected for lack of a citation to the record. Service of these counties is also irrelevant. The last sentence has been rejected by findings of fact 113 through 121, and particularly 119 and 120. The first portion of the first sentence is rejected by findings of fact 18, 19, 26, 28, 29, and 30. The last two sentences are rejected by findings of fact 26, 28, 29, 30, 33, 46, 70, 93, and 96. This proposed finding of fact is rejected by findings of fact 26, 46, 70, 93, and 96. The first four sentences are rejected because not supported by record evidence. None of the questions asked concerning deposition responses significantly pertained to the witness's ultimate credibility, and her responses upon cross examination were believable. The fifth and sixth sentences are rejected because the error noted, III-2, 164, is relatively insignificant. The seventh sentence, which pertains to the lack of precise charges for services, has been rejected in finding of fact 84. The eighth and ninth sentences are rejected because there is no evidence to explain the relevance of the question asked by counsel. If the definition of "residential treatment beds" pursuant to the state health plan were important in this case, presumably an expert would have testified to the issue. An assumption cannot be made that the definition of "residential treatment beds" in the state health plan is relevant in this case without some evidence or explanation for the relevance. Moreover, the context of the question was with respect to the loss of the 18 "minimum residential beds" which in fact were not "treatment" beds. See findings of fact 12 and 31. Thus, the question had little relevance to the witness. The tenth sentence is true, but does not, in context, significantly detract from the credibility of the witness. The final sentence is rejected for the reasons stated in this paragraph. This proposed finding is rejected in findings of fact 113 through 121. This proposed finding is an argument of law, not fact, and thus is rejected as a finding of fact. This is a summary conclusion of fact that has been rejected throughout the findings of fact. This proposed finding of fact is rejected for the reasons stated with respect to MMH proposed finding of fact 27. This proposed finding of fact is rejected for the reasons stated with respect to MMH proposed finding of fact 27 and findings of fact 40, 41, and 43. Findings of fact proposed by the Department of Health and Rehabilitative Services: This proposed finding of fact is not supported by the record cited, and is irrelevant since the applicant has not sought approval of 39 short term psychiatric beds. The methodology upon which this proposed finding of fact is based is not contained in State rule 10-5.11(25), Florida Administrative Code, and is not a methodology contained in the relevant 1983 local health plan, MMHC Ex 1. If it is incipient policy applied to this case, HRS failed to clearly explicate the basis for the policy. Indeed, the record concerning the policy is quite unclear. VIII-2, 50-53. In particular, no explanation was given for using utilization rates, or the validity of the utilization rates. It appears that this proposed finding of seeks a finding of fact that the status quo utilization at the only provider of short term psychiatric care, and thus the only source of utilization data in Manatee County at present should be projected to 1988 populations. The utilization rates appear to be derived from use rates for 1984! 1985, and 1986 populations. Which one is right? Why does this health planning method predict more net need in 1984 based upon fewer people living in Manatee County, and less net need in 1986, based upon more people living in Manatee County? HRS Ex. 1. Moreover, how can the needs of the mentally ill in Manatee County be predicted from use data derived by Manatee Memorial Hospital (the county's only resource) which for the relevant years has been running at full capacity? How can the unmet need be measured by such a method? The record does not answer these questions. It contains no explanation for the Source of the utilization rates except that it came from "the local health council." VIII-2, 50. Thus, this proposed finding of fact must be rejected for lack of explication in the record. Because this proposed finding of fact appears to rely on proposed finding of fact 7, it too must be rejected. A net need for the 17 beds does exist independently of proposed finding of fact 7. 11. To the extent that this proposed finding implies that currently the 18 minimum residential beds are mental health treatment beds, that proposed finding has been rejected by finding of fact 12. COPIES FURNISHED: Michael J. Cherniga, Esquire Fred W. Baggett, Esquire Roberts, Baggett, LaFace & Richard 110 East College Avenue Tallahassee, Florida 32301 Chris H. Bentley, Esquire Fuller & Johnson, P.A. Ill North Calhoun Street Post Office Box 1739 Tallahassee, Florida 32302 William E. Hoffman, Jr., Esquire James A. Dyer, Esquire King & Spalding 2500 Trust Company Tower 25 Park Place Atlanta, Georgia 30303 Theodore E. Mack, Esquire State of Florida, Department of Health and Rehabilitative Services Room 407 - Building One 1-323 Winewood Boulevard Tallahassee, Florida 32301 Jay Adams, Esquire 215 E. Virginia St., Suite 200 Tallahassee, Florida 32301 John P. Harllee, III, Esquire Harllee, Porges, Bailey & Durkin, P.A. 1205 Manatee Avenue Post Office Box 9320 Bradenton, Florida 33506 Wallace Pope, Jr., Esquire Johnson, Blakely, Pope, Bokor & Ruppel, P. A. P. O. Box 1368 Clearwater, Florida 33517 William Page, Jr. Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32301
The Issue Did Respondent, Tonya Shrader, R.N. (Ms. Shrader), violate section 464.018(1)(j), Florida Statutes (2015),1/ by being unable to practice nursing with reasonable skill and safety to patients by reason of illness or use of alcohol, drugs, narcotics, or chemicals or any other type of material, or as a result of any mental or physical condition? If Ms. Shrader violated section 464.018(1)(j), what penalty should be imposed?
Findings Of Fact Section 20.43 and chapters 456 and 464, Florida Statutes, charge the Department of Health, Board of Nursing, with the licensing and regulation of nurses. At all times material to the allegations in the Administrative Complaint, Ms. Shrader was a licensed registered nurse in the State of Florida. She holds license RN 9180605. Ms. Shrader has a complicated history of psychiatric and medical problems that affect her ability to practice nursing with the level of skill and safety to patients required in the State of Florida. Ms. Shrader has suffered from depression since childhood. Ms. Shrader treated her depression with a variety of medications, including: Lithium, Depakote, Pamelor, Elavil, Topamax, Lamictal, and Prozac. In the past five years, Ms. Shrader has not received treatment for her depression. Ms. Shrader also suffers from anxiety. Ms. Shrader is not receiving treatment for her anxiety. In addition to depression and anxiety, Ms. Shrader suffers from chronic severe migraines. The cause has not been determined despite extensive neurological evaluations. Ms. Shrader has been prescribed Tramadol, Fiorcet, and Clonazepam to treat her migraines. At all times material to the Department's complaint, Ms. Shrader was prescribed Fiorcet for her migraine symptoms. Between March 24, 2012, and July 22, 2013, Ms. Shrader complained of multiple neurological symptoms, including double vision, balance and gait instability, and tingling and numbness in her hands. Ms. Shrader elected to undergo extensive neurological testing to rule out demyelinating disease, multiple sclerosis, and palsy. The tests provided no indication that Ms. Shrader's symptoms resulted from a neurological disorder. At all times material to this proceeding, Ms. Shrader worked as a registered nurse in the Neurological and Psychiatric Unit at Gulf Coast Medical Center (Gulf Coast). On December 20, 2013, Ms. Shrader took an excessive dose of four Fiorcet pills. She told her family that she "plans to keep overdosing until she dies," and that she "predicts that [she] will be dead by the end of the year." Ms. Shrader's family contacted the Emergency Medical Services. Ms. Shrader was transported to Lehigh Regional Medical Center, where she was treated for an overdose. Ms. Shrader was involuntarily admitted to SalusCare, Inc. (SalusCare), for inpatient psychiatric observation and treatment. On December 20, 2013, the Crisis Stabilization Unit (CSU) at SalusCare conducted an in-patient psychiatric evaluation of Ms. Shrader. During the evaluation, Ms. Shrader denied past psychiatric treatments or psychiatric medication. Ms. Shrader also denied that her Fiorcet overdose was an attempted suicide. Her statements during her SalusCare evaluation contradict her medical charting and statements she has made, which indicate that she has an extensive history of psychiatric illnesses. SalusCare discharged Ms. Shrader on December 23, 2013. The director of nursing at Gulf Coast contacted the Intervention Project for Nurses (IPN) about Ms. Shrader. IPN is an impaired practitioner consultant to the Department's Board of Nursing. IPN works with nurses and monitors them for safety to practice issues. IPN contacted Ms. Shrader on January 2, 2014, to discuss her entering the program. Ms. Shrader denied that she was impaired or abused any substances. She admitted that she was depressed. But she said that she stopped her depression treatment approximately five years earlier. IPN asked Ms. Shrader to undergo an evaluation to determine her fitness to practice nursing. Ms. Shrader scheduled an evaluation with Theodore Treese, M.D., an expert in the psychiatric treatment, monitoring, and care of health care practitioners. He conducted the evaluation on January 28, 2014. Dr. Treese diagnosed Ms. Shrader with severe major depressive disorder; alcohol abuse; opioid abuse; sedative, anxiolytic abuse; relational problems, not otherwise specified; and rule-out polysubstance abuse. During the evaluation, Ms. Shrader attempted to hide her in-patient psychiatric treatment at SalusCare. Based on Ms. Shrader's diagnoses, Dr. Treese determined that Ms. Shrader was not capable of practicing as a registered nurse with reasonable skill and safety to patients. Dr. Treese recommended that Ms. Shrader seek treatment at a substance abuse treatment center at a level of at least partial hospitalization. Ms. Shrader did not agree with Dr. Treese's recommendation. IPN gave Ms. Shrader the opportunity to seek a second opinion from another IPN-approved evaluator. IPN informed Ms. Shrader that she needed to either obtain a second opinion or enter the recommended treatment before April 14, 2014; otherwise, IPN would close her intake case file. Ms. Shrader refused to obtain a second opinion or enter into the recommended treatment. IPN closed Ms. Shrader's file on April 14, 2014. On December 2, 2014, Mark Sylvester, M.D., a physician specializing in psychiatry and addiction medicine, evaluated Ms. Shrader pursuant to Department Order. Dr. Sylvester reviewed Ms. Shrader's medical records, the IPN intake case file, and the Department's investigative report. Dr. Sylvester also asked Ms. Shrader to undergo a urine and hair drug screen. Ms. Shrader did not participate in the screens. Dr. Sylvester diagnosed Ms. Shrader with recurrent major depressive disorder, opioid abuse, alcohol abuse, benzodiazepine abuse, nicotine dependence, factitious disorder versus malingering, rule-out hypochondriasis, and rule-out conversion disorder. During the evaluation, Ms. Shrader attempted to conceal her psychiatric history, substance abuse, and symptoms of depression. Ms. Shrader's unwillingness to be forthcoming during her evaluation demonstrated denial of her symptoms and presented a significant barrier to her treatment and recovery. Dr. Sylvester concluded that Ms. Shrader's poor judgment and decision-making detrimentally affected her ability to practice nursing. Specifically, Ms. Shrader's judgment in attempting to practice nursing while impaired, her lack of insight into her illnesses, her inability to follow treatment recommendations, and her disagreement with medical professionals showed poor judgment. Poor judgment can affect decision-making while practicing nursing, especially in a crisis situation. Dr. Sylvester concluded that Ms. Shrader was unable to practice nursing with reasonable skill and safety by reason of her depression, use of alcohol, opioids, and benzodiazepines, lack of insight into her symptoms, and poor judgment. In order for Ms. Shrader to be able to practice nursing with reasonable skill and safety to patients, she must: undergo treatment at a residential treatment center; enter into an IPN monitoring agreement; and submit to a hair analysis drug screening test. These steps are essential to Ms. Shrader's recovery and to regaining the ability to practice nursing with reasonable skill and safety to patients. There is no evidence that Ms. Shrader has taken any of these steps. Ms. Shrader is unable to practice nursing with reasonable skill and safety to patients.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner, Department of Health, Board of Nursing, enter a final order: finding that Respondent, Tonya L. Shrader, R.N., violated section 464.018(1)(j); requiring her to undergo an IPN evaluation; imposing a suspension of her license until such time as she undergoes an IPN evaluation; requiring compliance with IPN recommendations, if any; requiring the payment of an administrative fine in the amount of $250.00; and awarding costs for the investigation and prosecution of this case, as provided in section 456.072(4) to the Department. DONE AND ENTERED this 29th day of July, 2015, in Tallahassee, Leon County, Florida. S JOHN D. C. NEWTON, II Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 29th day of July, 2015.
Findings Of Fact Petitioner, Richard W. Merritt, D.C. is a chiropractic physician licensed under Chapter 460, Florida Statutes, and is actively practicing chiropractic in the State of Florida. By this action Petitioner challenges the validity of Rule 61F2- 17.007(6)(a), F.A.C.. The pertinent portions of the challenged Rule purport to define several terms to be utilized by the peer Review Committee in evaluation of chiropractor performance as brought before it. Specifically in issue are provisions of Rule 61F2-17.007: (6)(a) "Appropriate medical treatment" as used in Section 460.4104, Florida Statutes, is defined as a determination made of treatment and other services performed, which by virtue of a substantiated and properly diagnosed condition, appears to be of a type consistent with that diagnosis as reviewed by the peer review committee. "Properly utilized services" as used in Section 460.4104, Florida Statutes, means a determination made of appropriate medical treatment services rendered including frequency and duration which are substantiated as being necessary and reasonable by clinical records and reports of the provider as reviewed by the peer review committee. "Appropriate costs" as used in Section 460.4104, Florida Statutes, mean a determination made of charges submitted for properly utilized services performed which appear to be necessary and reasonable charges for similar provider services in the judgement of the peer review committee. As a licensed chiropractic physician subject to Chapter 460, Florida Statutes, Petitioner is substantially affected by the challenged rule because: he is a "health care provider" as defined by Section 460.403(5), Florida Statutes, and as used in Section 460.4104, the specific authority for and statute implemented by the challenged rule; the challenged rule expressly applies to health care providers and establishes definitions of statutory standards applicable to the peer review of the practice of chiropractic by chiropractic physicians including Petitioner; and the rule, when applied in conjunction with Section 460.4104, Florida Statutes, may subject chiropractic physicians, including Petitioner, to potential penal sanctions for the practice of chiropractic which violates the definitions incorporated in the challenged rule applied consistent with the statutory standard. The Respondent, Department of Business and Professional Regulation, (now Agency for Health Care Administration), Board of Chiropractic, (Board), promulgated the challenged rule and has the responsibility for implementing it as well as the whole of Chapter 460, Florida Statutes and Chapter 61F2, F.A.C..
The Issue The issue presented is whether Respondent HealthSouth Corporation engaged in an unlawful employment practice as to Petitioner Mary A. King, and, if so, what relief should be granted to Petitioner, if any.
Findings Of Fact Petitioner Mary A. King is a black female born on April 5, 1952. Respondent HealthSouth Corporation operates HealthSouth Rehabilitation Hospital of Tallahassee, located in Tallahassee, Florida. Petitioner was initially employed by HealthSouth in 1995 as a nurse tech or certified nursing assistant (CNA) in the nursing department. In 1998 she suffered a back injury while performing her regular CNA duties. She received treatment for the injury and returned to work with lifting limitations placed on her by her doctor. The limitations were inconsistent with her duties as a CNA and are still in effect. In 1999 Petitioner requested a transfer to the position of patient transporter aide due to her lifting limitations and concerns over her back injury. Her transfer request was granted, and she began to work as a patient transporter in the physical therapy department. She was pleased with the transfer. As a patient transporter, Petitioner was responsible for transporting patients to and from the locations in the hospital where they received treatment. She was not directly involved in the administration of treatment to patients. Subsequently, Petitioner was transferred from the physical therapy department to the occupational therapy department. Her position and job duties remained the same; the only change was in the types of patients Petitioner transported. On September 1, 2004, new federal regulations went into effect. These regulations directly impacted all in-patient rehabilitation hospitals, limiting the types of patients that HealthSouth could accept. The new regulations had a severe impact on HealthSouth, causing a dramatic drop in the patient census. The 76-bed facility had an average daily census of 65, and occasionally up to 76, prior to the effective date, but only a patient census in the 30s and 40s after the effective date of the new regulations. With the dramatic drop in patient census, HealthSouth had to dramatically reduce costs. Lynn Streetman, Administrator of HealthSouth Rehabilitation Hospital of Tallahassee, looked at a variety of ways in which costs could be reduced, including re- structuring contracts with outside vendors, reducing orders of medical supplies, reducing or substituting pharmaceutical orders, discontinuing the use of P.R.N. or as-needed staff, and, ultimately, reducing the workforce at the hospital. Streetman began reducing the workforce through attrition. As positions at the hospital became vacant, they were not filled if they were not critical to the functioning of the hospital and if there would not be a negative impact on patient care. Although reducing the workforce through attrition helped, more workforce reductions were necessary to respond to the hospital's declining patient census. In order to determine what positions to eliminate, Streetman preliminarily reviewed all positions throughout the facility and developed a list of positions she thought could be eliminated with minimal impact on the hospital's operations. The criteria she used included whether the position was a clinical or non-clinical position, whether the position was essential to the operation of the hospital or merely a luxury position, whether the duties of the position could be effectively absorbed by other positions in the hospital, and what impact the elimination of the position would have on patient care. Streetman next met individually with members of the hospital's senior management team to discuss the positions in their respective departments that she had preliminarily identified as appropriate for elimination. She obtained input from the team members as to whether it would be appropriate to eliminate those positions and what impact their elimination would have on the functioning of their respective departments. After she met with the team members to discuss the reduction in force and consider their input, Streetman made the decision to eliminate 13 positions at the hospital in December 2004 and January 2005. Three positions were eliminated in December, and ten were eliminated in January. Streetman was the person responsible for making the final decision about which positions to eliminate. Of those employees affected by the reduction in force, 6 were black and 7 were white. Of those employees affected by the reduction in force, 6 were over 40 years of age, and 7 were under 40 years of age. Each employee whose position was eliminated as a part of the reduction in force was informed that he or she would be eligible to purchase insurance benefits through COBRA for up to 18 months after his or her employment with the hospital ended, each was paid for any accrued paid time off, and each eligible employee received severance benefits in accordance with an identical formula: one week of pay for every year of service up to a maximum of ten years. With the exception of a part-time employee who was not eligible, all employees affected by the reduction in force received benefits, paid time off payments, or severance payments in accordance with these policies. One of the positions selected for elimination was that of patient transporter. When Streetman was employed by HealthSouth, there had been three patient transporters. Two of the three positions had already been eliminated through attrition, and Petitioner was the only remaining patient transporter. Since Petitioner's position was eliminated, HealthSouth has not hired anyone as a patient transporter. Petitioner's position was selected for elimination because it was not essential to the operation of the hospital, was not responsible for any direct patient care, and was a luxury position for the facility. As verification that the elimination of Petitioner's position would not have a negative impact on the level of patient care at the hospital, Streetman considered that therapists at the hospital had already been assisting in the transportation of patients to and from treatment and that the previous reduction of two patient transporters through attrition did not negatively impact patient care at the hospital. Petitioner's job duties were absorbed into the daily work routine of therapists in the outpatient therapy department. Therapists simply transported their own patients rather than have Petitioner (and the other transporters who had previously been phased out through attrition) perform this function for them. Petitioner was informed of the decision to eliminate her position on November 30, 2004, by Donna Crawford, Director of Clinical Services, and Cindy Cox, Occupational Therapy Team Leader. Crawford informed Petitioner that Petitioner's position was being eliminated, that Petitioner would receive severance pay in accordance with her years of service, that Petitioner would be paid for all of her accrued paid time off, and that Petitioner was welcome to apply for any other open position at the hospital for which she was qualified. Crawford also told her that Petitioner was welcome to discuss any open positions with Jackie Chaires, Human Resources Director at the hospital. Petitioner was paid 360 hours of severance pay (nine weeks pay for nine years of service), was compensated for all accrued paid time off, and was sent a letter informing her of her right to purchase insurance under COBRA for up to 18 months after her employment with Respondent had ended. Petitioner also applied for and received unemployment benefits as a result of her job being eliminated. After Crawford advised her that her position had been eliminated, Petitioner went to talk with Jackie Chaires, a black female. Petitioner told Chaires that she did not understand why she had been laid off and asked about any available positions. During that conversation, in an attempt to console Petitioner according to Chaires' affidavit but as an act of discrimination according to Petitioner's testimony, Chaires suggested that Petitioner could also retire and let Petitioner's husband take care of her. At no time did Chaires suggest that Petitioner's husband's situation, his income, or Petitioner's age were factors in HealthSouth's decision to eliminate her position as part of its reduction in force. Moreover, Chaires was not involved in any way in the selection of Petitioner's position for elimination. At some point after being informed that their positions were eliminated, Petitioner, along with Kim Spencer, another employee affected by the reduction in workforce, inquired as to whether there were positions available in the nursing department. However, there were no positions available in that department, and both Petitioner and Spencer were informed that their requests could not be accommodated. Spencer is a white female. HealthSouth has a written policy prohibiting employees from giving letters of recommendation. At some point after being informed that her position was eliminated, Petitioner asked Cynthia Cox, her direct supervisor, for a letter of recommendation. Cox agreed to give her one even though she was uncertain as to the correct procedure, but after ascertaining from the human resources department that a recommendation would be against corporate policy, Cox told Petitioner she could not give her the letter and told Petitioner that it was against corporate policy. That policy is clearly stated in the hospital's employee handbook, which Petitioner had been given. At no time prior to her filing her charge of discrimination with the Florida Commission on Human Relations did Petitioner inform any of her supervisors that she felt she was being discriminated against in any way based on either her race or her age. Patsy Kitchens is a white female who is the same age as Petitioner. HealthSouth terminated her employment at the same time as it terminated Petitioner's employment as part of the same reduction in force.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding that Petitioner failed in her burden of proof and dismissing the petition filed in this cause. DONE AND ENTERED this 24th day of March, 2006, in Tallahassee, Leon County, Florida. S LINDA M. RIGOT 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 24th day of March, 2006. COPIES FURNISHED: Cecil Howard, General Counsel Florida Commission on Human Relations 2009 Apalachee Parkway, Suite 100 Tallahassee, Florida 32301 Denise Crawford, Agency Clerk Florida Commission on Human Relations 2009 Apalachee Parkway, Suite 100 Tallahassee, Florida 32301 Mary King 1039 Idlewild Drive Tallahassee, Florida 32311 L. Traywick Duffie, Esquire Wesley E. Stockard, Esquire Hunton & Williams, LLP Suite 4100 600 Peachtree Street, Northeast Atlanta, Georgia 30308-2216
The Issue Whether Respondent violated Sections 458.331(1)(g), (j), (m), (q), and (t), Florida Statutes, and if so, what penalty should be imposed.
Findings Of Fact Petitioner, Agency for Health Care Administration (AHCA), is the state agency charged with regulating the practice of medicine pursuant to Section 20.20 and Chapters 455 and 458, Florida Statutes. Respondent, Ronald L. Cohen, M.D. (Dr. Cohen), is and has been at all times material hereto a licensed physician in the State of Florida, having been issued license number ME 0024014. Dr. Cohen's last known address is 7800 West Oakland Park Boulevard, Suite 216, Fort Lauderdale, Florida. Dr. Cohen's area of practice is urology, and he is board certified. He has been practicing in Fort Lauderdale since 1976. During his years of practice, he has enjoyed an excellent professional reputation. Between on or about July 2, 1990, through on or about May 16, 1992, Dr. Cohen treated Patient R.G. for various complaints. On or about July 2, 1990, Patient R.G., a thirty-four year-old female with a history of chemical dependency from the age of twelve for which she first underwent treatment in or about 1986, presented to Dr. Cohen with voiding complaints including post void dysuria, frequency, urgency, and urgency incontinence. However, such information about chemical dependency was unknown to Dr. Cohen until a subsequent time. Patient R.G. did not reveal to Dr. Cohen either her history of chemical dependency or treatment of that dependency. Dr. Cohen performed a physical examination of Patient R.G. wherein Dr. Cohen dilated Patient R.G.'s uretha. Dr. Cohen noted that Patient R.G.'s urinalysis was entirely within normal limits. Dr. Cohen then diagnosed Patient R.G. with urethritis, urthrel stenosis, and trigonitis. Dr. Cohen prescribed Patient R.G. a three-day supply of Noroxin and pyridium to improve Patient R.G.'s symptoms. Noroxin is an antibacterial agent indicated for the treatment of adults with complicated urinary tract infections. Pyridium is an analgesic agent indicated for the symptomatic relief of pain, burning, urgency frequency and other discomfort arising from irritation of the lower urinary tract mucosa. Patient R.G.'s symptoms persisted. On or about July 13, 1990, Patient R.G. underwent a cystoscopy, urethal dilation, and hydraulic bladder distention by Dr. Cohen at Outpatient Surgical Services in order to rule out interstitial cystitis. Dr. Cohen's postoperative impressions were as follows: Interstitial cystitis (inflammatory lesion of the bladder) and urethral stenosis. On or about July 17, 1990, Patient R.G. presented to Dr. Cohen's office in severe pain secondary to the cystoscopy and bladder distention. At that time, Patient R.G. complained of feeling bloated suprapubically. Dr. Cohen instilled dimethyl sulfoxide to relieve Patient R.G.'s pain. Patient R.G.'s symptoms were subsequently temporarily resolved. On or about January 19, 1991, Patient R.G. next presented to Dr. Cohen with complaints of a recurrent episode of urinary frequency and burning on the previous day. Shortly thereafter, in early 1991, Dr. Cohen asked Patient R.G. to go to lunch. Dr. Cohen and Patient R.G. subsequently began a social relationship which included sexual intercourse. At the time that Dr. Cohen initiated the relationship with Patient R.G. he was aware of the prohibitions against such conduct, knew he had choices available to him, but declined to exercise professional self-discipline. Dr. Cohen did exercise influence as Patient R.G.'s physician for the purpose of engaging in sexual relations. Dr. Cohen has never had a sexual relationship with any other patient. On or about April 8, 1991, Dr. Cohen wrote a prescription for thirty units of Valium 10 mg. for Patient R.G. who had at that time complained to Dr. Cohen of anxiety due to marital difficulties. Valium is defined as a legend drug by Section 465.003(7), Florida Statutes, and contains diazepam, a Schedule IV controlled substance listed in Chapter 893, Florida Statutes. Valium is indicated for the management of anxiety disorders or for the short-term relief of symptoms of anxiety. Dr. Cohen's medical records of Patient R.G.'s urologic condition do not include any reference to the Valium prescription and therefore the records fail to justify his prescription of Valium, a controlled substance indicated for the treatment of anxiety, to Patient R.G. On May 16, 1992, Dr. Cohen wrote a prescription for thirty units of Prozac 20 mg. Prozac is defined as a legend drug by Section 465.003(7), Florida Statutes, and contains Fluoxetine Hydrochloride which is not a controlled substance. Prozac is indicated for the treatment of depression. Dr. Cohen's medical records of Patient R.G.'s urologic condition do not include any reference to the Prozac prescription and therefore the records fail to justify his prescription of Prozac. Dr. Cohen inappropriately prescribed Prozac, a legend drug indicated for the treatment of depression. Prozac, however, was not indicated in the treatment of Patient R.G.'s urologic condition, interstitial cystitis. Dr. Cohen admitted to having prescribed Prozac to Patient R.G. as a favor so that Patient R.G. did not have to see her psychologist for said prescription. Dr. Cohen admitted to having a sexual relationship with Patient R.G. Dr. Cohen, by virtue of his sexual relationship with Patient R.G. and his inappropriate prescribing of Prozac for Patient R. G., failed to practice medicine with that level of care, skill, and treatment which is recognized by a reasonably prudent physician as being acceptable under similar conditions and circumstances. Dr. Cohen underwent an evaluation by Thomas J. Goldschmidt, M.D., a specialist in neurology and psychiatry, in conjunction with Richard Westberry, Ph.D., a licensed psychologist. Dr. Goldschmidt issued a report on their evaluation in which he stated: We see no evidence of any exploitative tendency regarding Dr. [Cohen] in his relationship with this patient. There is no evidence of any sexual addiction component. And we do not feel that his is behavior that is likely to reoccur or compromise his ability to practice urology. We see this as an isolated incident that Dr. [Cohen] approached in a very naive fashion and was primarily orchestrated by the dynamics of a sexually provocative, aggressive female who proposed a sexual act that was nonthreating (sic) to the patient while simultaneously providing ego gratification for longstanding, underlying emotional conflicts dealing with castration fears and anxiety. Dr. Cohen voluntarily entered into a contract with the Physician's Recovery Network to assist him in dealing with his despondency and depression. Dr. Cohen continues to see Dr. Westberry on a weekly basis for his despondency. Dr. Cohen has never had any disciplinary action taken against his license nor has he been dismissed from any position at a hospital at which he had staff privileges. Dr. Cohen has staff privileges at four hospitals. Dr. Cohen was Vice Chief of Staff at one of the hospitals until he voluntarily resigned that position when this case surfaced in order to avoid embarrassment to the hospital.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding that Dr. Cohen violated Sections 458.331(1)(g), (j), (m), (q) and (t) as set forth in Counts 1-5 in the Administrative Complaint, and imposing a $5,000 fine for the violations of Sections 458.331(1)(g) and (j), Florida Statutes and a $5,000 fine for violations of Sections 458.331(1)(m), (q), and (t), Florida Statues, for a total of $10,000, and placing Dr. Cohen on probation for two years under terms and conditions to be set by the Board of Medicine. DONE AND ENTERED this 15th day of March, 1996, in Tallahassee, Leon County, Florida. SUSAN B. KIRKLAND Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 15th day of March, 1996. APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-3274 To comply with the requirements of Section 120.59(2), Florida Statutes (1995), the following rulings are made on the parties' proposed findings of fact: Petitioner's Proposed Findings of Fact. Paragraphs 1-9: Accepted. Paragraphs 10-11: Accepted in substance. Paragraphs 12-14: Accepted. Paragraph 15: Rejected as irrelevant because the administrative complaint did not state such a violationas it related to the valium but only as to the Prozac. The violation relating to valium was the record keeping. Paragraphs 16-19: Accepted. Paragraph 20: Accepted except as to the valium. The administrative compliant did not allege such a violationas it related to valium. Respondent's Proposed Findings of Fact. Paragraphs 1-2: Accepted. Paragraph 3: Accepted in substance. Paragraph 4: Accepted as to his professional reputation. The remainder is rejected as unnecessary. Paragraph 5: Rejected as subordinate to the facts found. Paragraph 6: The first sentence is accepted. The remainder is unnecessary. Paragraphs 7-13: Accepted. Paragraph 14: Rejected as subordinate to the facts found. Paragraph 15: Rejected as not supported by the greater weight of the evidence. Dr. Cohen is the party whoinitiated the social relationship with R.G. when heasked her out to lunch. He was physically attracted tothe patient and that is why he asked her out. Paragraph 16: Accepted. Paragraph 17: The first sentence is accepted. The last sentence is rejected as subordinate to the facts found because Dr. Cohen did prescribe medication forR.G. which had nothing to do with the complaints forwhich she was seeing Dr. Cohen. Paragraph 18: Rejected as subordinate to the facts found. See paragraph 17. Paragraphs 19-22: Rejected as subordinate to the facts found. Paragraph 23: The first and second sentences are rejected as subordinate to the facts found. The thirdsentence is accepted to the extent that he has enteredcounseling. Paragraphs 24: Accepted to the extent that he is in counseling and that such a relationship will not likelyoccur again. Paragraph 25: Accepted in substance. Paragraph 26: The first two sentences are accepted in substance. The remainder is rejected as unnecessary. Paragraph 27: Accepted in substance that such a relationship is unlikely to happen in the future. Rejected to the extent that it implies that R.G. gavefree, full informed consent to the sexual activity. Paragraphs 28-29: Accepted in substance. Paragraph 30: Rejected as subordinate to the facts found. Paragraphs 31-34: Accepted in substance. Paragraph 35: Rejected as unnecessary. Paragraphs 36-39: Accepted in substance. COPIES FURNISHED: Donald G. Korman, Esquire Korman, Schorr and Wagenheim The Dart Building 2101 North Andrews Avenue, Suite 400 Ft. Lauderdale, Florida 33311 Paul Watson Lambert, Esquire 2851 Remington Green Circle, Suite C Tallahassee, Florida 32308-3749 Albert Peacock, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-6506 Dr. Marm Harris Executive Director Agency For Health Care Administration Board of Medicine 1940 North Monroe Street Tallahassee, Florida 32399-0770 Jerome W. Hoffman General Counsel Agency For Health Care Administration 2727 Mahan Drive Fort Knox Building 3, Suite 3431 Tallahassee, Florida 32308-5403
