Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found: Surgical Services of Tampa, Inc. (SST) is a wholly owned subsidiary of Surgical Services, Inc., (SSI) located in Orlando, Florida. Eighty percent of SSI is owned by American Medical International, Inc. (AMI), the third largest health care provider in the United States. The remaining twenty percent ownership of SSI is held by Randall M. Phillips, who also serves as the president of SST. AMI owns and operates some 70 acute care hospitals in the United States and abroad, a nursing home and 7 or 8 ambulatory surgery centers around the country. Two of these centers are located in Florida, one in Clearwater and one in Tallahassee, and SSI has the responsibility for these centers. SSI also holds several Certificates of Need for other free standing ambulatory surgery centers to be constructed in Florida. AMI has made a commitment to provide financial support for the total development of the applicant's proposed ambulatory surgery facility in Tampa. This support includes the purchase of the land, construction of the building, equipping the facility and working capital. The financing is to be in the form of a fifty percent equity contribution and a 28-year loan at 12 percent interest to SST for the remaining funds. AMI has sufficient financial resources to fulfill its commitment to the proposed project. The total projected cost for the proposed facility is $2,240,800.00. The parties have stipulated that the proposed costs associated with construction, equipment and land acquisition and preparation are reasonable. The parties have also stipulated that the proposed staffing pattern is adequate and that the applicant SST will have the ability to adequately staff the proposed facility. While SST had not made a firm site selection at the time of the hearing, it has plans to locate its facility somewhere near the vicinity of St. Joseph's Hospital and the Human Women's Hospital in Tampa, Florida. Its service area includes all of Hillsborough County. The center will consist of four operating rooms or surgical suites, and laboratory, x-ray and administrative areas for a total of 15,000 square feet. SST plans to handle all types of surgical procedures which can be performed on an outpatient basis. Its medical staff will be open to all doctors qualified to perform the types of surgeries that can be accomplished on an ambulatory, outpatient basis. The facility will admit any patient a surgeon schedules for surgery, and will accept Medicare and Medicaid patients. SST plans to invoke an aggressive marketing effort to inform and educate consumers, insurance companies, employers, physicians and other health care facilities in the market area as to the benefits and cost- effectiveness of using its facility to perform surgery on an outpatient basis. It has budgeted some $20,000.00 to effect such a marketing program. Professional accreditation with the Joint Commission on Accreditation of Hospitals will be sought after the proposed facility completes its first year of operation. Based upon a 15 percent Medicare utilization or patient mix and using the lowest Medicare reimbursement level and a projected number of procedures of 2,234 and 2,681 for the first and second years of operation, SST projects that it will have a loss of $17,426 in its first year of operation and a profit of $22,173 in its second year of operation. Using the highest payment level in the amount of contractual allowances, SST's pro forma statement shows a net income in both years of $689 and $41,444, respectively. The projected Medicare utilization percentage of 15 percent was not demonstrated to be erroneous and approximates the Medicare mix experienced at the petitioner's ASC facility in the preceding year. The projection of 2,234 procedures to be performed in the first year of operation was derived by estimating the number of potential ambulatory surgeries in the proposed service area (approximately 30 percent of all surgeries) and subtracting therefrom the number currently being performed in hospitals (approximately 15 percent), leaving a projected unmet caseload of 2,234. The salary projections, which were adjusted for inflation under the assumption that the proposed facility would begin operations in August of 1984, appear to be reasonable and adequate. In the 1981-82 reporting period, approximately 58,000 total surgical procedures were reported in Hillsborough County. Of this number, approximately 82 percent were performed on an inpatient basis, while 18 percent were performed on an outpatient basis. The literature on the subject, as well as some other states, predicts that between 28 percent and 48 percent of all surgeries could be performed in ambulatory settings. In Salt Lake City, Utah, 38.2 percent of all surgeries are performed on an outpatient basis. A wider acceptance on the part of patients, consumers and physicians of the concept of performing surgery on an outpatient basis, as well as changes in third party reimbursement (including the new Medicare reimbursement system of payment based on diagnostic related groupings as opposed to lengths of hospital stay), should result in the performance of an increased percentage of surgeries on an outpatient basis. The applicant's expert ambulatory surgical facilities health planner utilized four different methodologies to evaluate the need for additional ambulatory surgery facilities in Tampa. The first methodology utilized was use rate-based and took into account population and historical surgery utilization data. Using the assumption that 30 percent of all surgeries performed can be performed in an ambulatory setting, projecting the number of surgeries expected in 1984 and subtracting the number performed on an outpatient basis in the last reporting period (1981-82), it was determined that the remaining unmet need in 1984 would be 8,226 ambulatory surgeries, and the respective figures for 1985 and 1986 would he 8,596 and 8,955. A flaw in this methodology is the assumption that existing facilities will not increase their usage of outpatient surgical procedures. The second methodology is also use rate-based, but predicts an increased performance of outpatient procedures by existing facilities, said increase approximating the percentage of population growth, assumes a 30 percent to 40 percent outpatient to inpatient ratio and produces a range of unmet need in 1984 of 7,586 to 13,753, in 1985 of 7,737 to 14,028, and in 1986 of 7,885 to 14,295. The third method is a use rate and capacity-based methodology. It also uses the 30 percent to 40 percent range as the potential ambulatory surgery market and then designates a number of dedicated operating rooms which would be appropriate to fill that need. Assuming that an average capacity is 1,200 procedures per room per year and that all current ambulatory surgeries are performed in dedicated ambulatory surgery suites, and then dividing that capacity figure into the number of expected ambulatory surgeries in 1984, the required number of dedicated operating rooms ranges from 16 to 21 in 1984 and 1985 and from 17 to 22 in 1986. Assuming 9 current dedicated ambulatory surgery operating rooms, the net need is determined as a range from 7 to 12 additional dedicated rooms in 1984 and 1985 and from 8 to 13 in 1986. The fourth methodology is similar to the first, but is based on patient day utilization. It uses a 30 percent outpatient to inpatient ratio, and yields an unmet need, after subtracting current procedures performed at existing facilities, of 8,221 procedures in 1984, 8,591 in 1985 and 8,950 in 1986. Each of the methodologies results in a sufficient number of outpatient surgical procedures to support the applicant's proposed surgery center. The respondent HRS has no promulgated rule prescribing the methodology to be utilized to determine the need for additional ambulatory surgical centers in an area. Its non-rule methodology, utilizes a use rate per 1,000 population for a given year, applies that to a projected population two and three years into the future and then multiplies that figure by 29 percent. The 29 percent represents a midrange between 18 percent and 40 percent, the range suggested by the literature as representing the percentage of total surgeries that can be performed on an ambulatory basis. Taking into account the existing outpatient use rate being experienced, the projected population and the projected number of outpatient procedures which will be provided by existing facilities, a total number of outpatient procedures that could be performed by an applicant is produced. The Department also considers the number of procedures an applicant would have to perform in order to break even financially in its second year of operation. This methodology relates need to financial feasibility, but does not consider capacity or optimum utilization factors. In this case, the use of HRS's methodology results in a total figure of 7,569 outpatient procedures that need to be provided in 1986 beyond those that would be provided by the existing outpatient facilities of the area hospitals. The HRS calculations do not consider those procedures being performed at the petitioner's ASC facility. HRS calculated that SST would have to perform 2,463 procedures by the year 1986 in order to break even financially, and therefore that there were a significant number of procedures available to support the need for an additional ambulatory surgery facility. Existing hospitals in Hillsborough County currently perform surgery on an outpatient basis. As indicated above, some 18 percent of all surgeries, or 10,276 procedures, were reported as outpatient in the 1981-82 reporting period by Hillsborough County facilities, including the petitioner. With the exception of the petitioner's four dedicated operating rooms and two more at an area hospital, the remaining existing operating rooms are not used exclusively for outpatient surgeries, but are available for such surgery. Many existing hospitals are currently in the process of expanding their outpatient services. These expansion efforts generally involve new pre-admission, pre-operative and recovery room beds and reception areas for ambulatory surgical patients, and not new dedicated operating rooms for outpatients. Among those receiving recent Certificates of Need to expand their outpatient services are Tampa General Hospital, St. Joseph's Hospital, Brandon Community Hospital and Humana's Women's Hospital. University Community Hospital is also active in the performance of outpatient surgical procedures. Depending upon the sufficiency and efficiency of management and staff, a freestanding ambulatory surgery center offers some advantages over outpatient surgery performed in a hospital operating room utilized for both inpatients and outpatients. The freestanding facility may have staff surgeons and anesthesiologists with specialized outpatient surgery training. Total overhead costs are likely to be less, thus resulting in reduced patient costs. Since the operating room staff effort is continually focused on outpatient surgery only, management problems may be reduced, thus making the experience more pleasant for the patient, his family and the surgeon. Patients will experience less waiting times as there will not be as many emergencies as in a hospital setting or as much "bumping" of an elective surgery outpatient in an ambulatory center. If properly and efficiently managed, there may be less danger of cross-infection in the freestanding facility. The petitioner ASC is a freestanding facility built in 1979 and located adjacent to the University of South Florida in Tampa. It occupies 14,350 square feet, has four operating rooms, a special procedures room, several examination rooms, 12 recovery beds, 8 pre- and post-operative beds, waiting rooms and administrative and business office areas. Staff privileges are held by 157 surgeons from the Tampa area. At the time of the hearing, 15 more surgeons had applied for staff privileges. Its total caseload for the first eleven months of operation was 257. Cases performed in 1980 increased to 420. In 1981 and 1982, ASC performed 1,172 and 1,217 procedures, respectively. For the first seven months of 1983, 1,191 procedures were performed, for a utilization rate of approximately 25 percent. ASC has no formal, regular budgeted marketing program. It has received accreditation from the Joint Commission on Accreditation of Hospitals.
Recommendation Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that HRS issue a Certificate of Need to Surgical Services of Tampa, Inc. to construct and operate a freestanding, four operating room ambulatory surgery center in Hillsborough County. Respectfully submitted and entered this 22nd day of March, 1984, 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 22nd day of March, 1984. COPIES FURNISHED: F. Phillip Blank and Robert A. Weiss, Esquires 241 East Virginia Street Tallahassee, Florida 32301 Claire D. Dryfuss, Esquire Assistant General Counsel 1323 Winewood Blvd. Tallahassee, Florida 32301 Fred W. Baggett and Michael J. Cherniga, Esquires 101 East College Avenue P.O. Drawer 1838 Tallahassee, Florida 32301 David Pingree Secretary Department of Health and Rehabilitative Services 1323 Winewood Blvd. Tallahassee, Florida 32301
Findings Of Fact In December 1982,, Ambulatory Care filed an application with the Department to be granted a certificate of need to construct a freestanding surgical center in Duval, Florida, to provide surgical treatment which does not involve overnight confinement, i.e. ambulatory or outpatient. The approximate cost of that project is $1,994,280. The proposed facility would be approximately 11,300 square feet in dimensions and contain four operating rooms with attendant substerile areas and scrub areas; necessary recovery, preoperative and postoperative areas; waiting areas; lounges staff changing areas; a business office area and physician space. The particulars of the description of the facility are more completely addressed in the application which is part of Department's Exhibit 1. The specific surgeries to be performed in this outpatient setting have not been determined; however, Ambulatory Care would anticipate proceeding on a basis similar to that of a freestanding ambulatory surgery center in Lexington, Kentucky, allowing for any differences in the two communities which might provide a different surgical mix by type. Information pertaining to that center was provided through the testimony of Dr. Edwin Nighbert, Transcript Pages 137-193. A further description of possible surgeries to be performed in the facility may be in the Department's Exhibit 1 through the Omission's Response of the applicant in an Appendix to that response numbered 1 entitled, "Types of Surgeries performed in an Ambulatory Surgical Facility." The surgeries to be performed are elective in nature and allow the patient to be discharged the same day of the procedure. The characterization of the facility as freestanding means that it is self-contained and not dependent upon other facilities in its normal operation. The exact location of that facility has not been established in that the purchase of property has not been concluded; however, Ambulatory Care intends to build the center in the Riverside area of Jacksonville, Duval County, Florida, as described by drawings and maps in the Omission's Response referred to before. Construction in this area would place the facility in the immediate vicinity of Saint Vincent's and Riverside Hospitals, which facilities also serve patients who undergo ambulatory surgery on an outpatient basis. Other hospitals in Duval County provide outpatient surgery, as more specifically described in latter portions of this Recommended Order. Following review, the Department issued a certificate of need for the project in its entirety, effective December 29, 1982. This action led to Petitioners' timely challenge to the proposed agency action. The Department simultaneously approved a certificate of need for another freestanding surgical facility in Duval County, Surgical Services of Jacksonville, Inc., with proposed expenditures of $2,500,000 and a plan to provide four operating rooms. That latter surgical center has not been challenged on the issue of the grant of its certificate, through protest from local hospitals. With the addition of Surgical Services and Ambulatory Care, outpatient surgery would be performed in Duval County in hospital settings, the freestanding centers, and physician's offices. The hospitals and Ambulatory Care are expected to provide the same surgical procedures either on an outpatient basis or inpatient basis. Saint Vincent's is a hospital which is owned by the Daughters of Charity, a religious order within the Catholic Church and is a nonprofit corporation. Riverside is a nonprofit hospital. Other hospitals in the area providing outpatient surgery at present or in the immediate future are Methodist Hospital, Jacksonville General Hospital, University Hospital, Baptist Medical Center, Memorial Medical Center, and Saint Luke`s Hospital. None of the hospitals referred to have freestanding outpatient surgery units, meaning all procedures provided by those institutions are hospital based. There being no rules promulgated in keeping with Section 381.494, Florida Statutes, related to the establishment of a methodology for considering the question of need for ambulatory surgical centers in Florida, the parties on this occasion attempted to establish a record basis for determining the need question. In this endeavor, objective and subjective observations and predictions were offered. Similarities and dissimilarities between hospital- based outpatient surgery centers and freestanding surgery centers were discussed and the relative merits of those sites ware debated. Given the novelty of this comparison in Florida, determination of need in the ambulatory surgery realm is less than an exact science. To accommodate this situation, factual determinations are based upon those elements of proof which tend to best describe the Duval County circumstance pertaining to the question of need for ambulatory surgeries at present and in the near future, with particular emphasis on the applicant's request for certificate. To begin, there is the issue of what constitutes a surgery for statistical purposes. In the State Agency Action Report related to the fiscal or calendar year reporting of procedures performed by Duval County hospitals ending in 1982, reference is made to the number of impatient and outpatient surgical procedures. There is uncertainty about some of the outpatient procedures reported, whether they are best described as surgical or diagnostic. As example, in Ambulatory Care's Omission's Response request it included certain procedures such as cysto which by exhibit were under a surgical heading. Subsequently, the applicant argued in the course of the hearings that these proceedings were diagnostic in nature and not surgical. One physician who testified believed that a cysto could be considered a surgery. Opinion was expressed that any procedure reported for insurance purposes as surgical should be accepted as such, even if primarily diagnostic in effect. A hospital official believed that procedures that are primarily diagnostic in effect are not surgeries. Another contributing element in the dilemma is the possibility that some procedures might be considered surgical at times and diagnostic at others depending on the intended result. Moreover, the record is not clear on whether some of the inpatient procedures reported for the 1981-82 reporting period by the Duval County hospitals would involve procedures which might arguably be described as diagnostic and not surgical. There being no consensus among the practitioners and the health care planners on the question of what constitutes a surgery and given the existence of a known statistical base, making allowances for adjustments related to numbers of outpatient surgeries in the reporting year ending 1982 which was made in the course of the hearing and consistent with Appendix 1 to the Omission's Response offered by the applicant, all procedures are considered surgical for purposes of this review, with the exception of endoscopic procedures. This determination takes into account that the applicant has not specifically delineated those procedures which it intends to perform. On a similar topic, Duval County has been identified as the service area for the Ambulatory Care facility. It is that population base which the Department used in trying to identify the surgical use rate for all surgeries and ultimately for ambulatory surgery by measure of surgeries per thousand population. This calculation fails to take into account the fact that patients from areas outside Duval County, especially from the surrounding counties use the hospitals in Duval County. It was not established in the course of the hearing what percentage or number of those patients from those outside areas were in the hospital for purposes of undergoing inpatient or outpatient surgery. Nonetheless it can be assumed based upon the facts presented that some portion of those patients did receive surgery thereby increasing the number of persons in the population base who underwent surgeries and decreasing the number of surgeries per thousand population. Moreover, the modification of statistics presented in the course of hearing to more correctly reflect the number of outpatient surgeries done in the reporting periods 1981-82 suggests that the total number of procedures was around 64,600, not the 68,000 plus first thought when the action report was prepared and the Department made its calculations. This change alone would reduce use rate for surgeries per thousand from 118 to 112. Having in mind a necessary adjustment in the population base to account for patients outside Duval County who receive surgery as well as adjustment in the outpatient surgery statistics in the 1982 reporting period, somewhat less than 112 surgeries per thousand could be expected. According to the applicant, the national experience has been an expectation of 55 to 90 surgical procedures per year per thousand population as a planning guideline. Those projections made as a result of research and data gathered are accepted as establishing the base from which more precise estimates may be made. In view of the national experience and the adjustments that are needed in the initial projection of the Department that 115 surgeries per 1,000 population would be the experience, 110 surgeries per 1,000 population is found to be a reliable figure both in 1982 and the succeeding years to include the critical years of 1985 and 1986, for Duval County, Florida, surgical procedures. This finding acknowledges the fact that 97 percent of the residents of Duval County seek their health care in Duval County. In trying to determine what percentage of all surgeries will be ambulatory or outpatient in the critical years 1985 and 1986, considerable testimony has been offered. That testimony tends to establish a potential for outpatient surgeries in the range 15 percent to in excess of 40 percent. During the reporting period for which data is available, as many as 15 percent of the surgeries performed in the Duval County hospitals have been performed on an outpatient basis. The Department has taken a median fraction or number between the extremes of 15 percent and 40 plus percent and anticipated 29 percent of all surgeries to be ambulatory surgeries in the years 1985 and 1986 in Duval County. In consideration of the dramatic increases in the number of outpatient surgeries being performed in local hospitals within the last two or three years, and the continuing improved reimbursement environment for those surgical procedures performed on an outpatient basis, 29 percent is a reasonable policy choice for making the projections. Based upon an analysis of the facts presented, it is not safe to assume that the number of outpatient surgeries performed in Duval County for its patients in the years 1985 and 1986 will approximate the 40 percent experience found in other communities outside Florida. The Department in its calculations has utilized mid-range projections of the University of Florida, BEBR, population studies showing a population in Duval County in 1985 of 387,500 and in 1986, 590,480. This midrange choice is sound. Employing the technique used by the Department, the following predictions are arrived at in terms of expected outpatient surgeries in Duval County in 1985 and 1986: 387,500 total populations x 110 procedures per thousand = 1,000 64,525 total procedures x .29 percentage of outpatient = 18,741 outpatient surgeries in 1985 * * * 390,480 total populations x 110 procedures per thousand = 1,000 64,953 total procedures x .29 percentage of outpatient = 18,835 outpatient surgeries for 1986. Who is to provide those outpatient surgeries in 1985 and 1986? In answering that inquiry, in 1981, excluding endoscopic examination, area hospitals performed 6,450 outpatient surgeries. This number increased to 9,527 in 1982 and based upon statistics provided for the first quarter of 1983 that number would approximate 11,000 outpatient procedures in 1983. This growth pattern in those reporting years reflects substantial increases in the delivery of health care related to outpatient surgeries; however, an extrapolation of percentage increases over the intervening year 1984 and into 1985 and 1986 does not give a reliable approximation of the level of outpatient surgeries to be provided by the several hospitals. Neither does the estimate by the Department that the increase in surgeries performed in the hospitals shall be only to the extent of the increase in population in Duval County in the intervening years. Therefore, the question of available capacity in the years 1985 and 1986 is considered on the basis of an inventory or audit of outpatient surgical suites which may reasonably be expected to provide outpatient surgeries in 1985 and 1986 based upon the selection or a utilization rate for those operating rooms. The applicant has initially indicated in its application that 1,200 ambulatory cases could be dealt with in one operating suite on an annual basis. Initial testimony of one of the applicant's witnesses, Andrew Miller, at transcript page 460, was to the effect that the range 1,200 to 1,250 cases approached the capacity for a single dedicated operating room performing outpatient surgery. In rebuttal testimony, Miller recanted and indicated that 1,300 cases per operating room was not a reasonable estimate for hospitals in Duval County. He suggested the use of lower figures, perhaps as low as 1,000 procedures per room. In the face of the evidence, it is determined that for purposes of this review 1,100 procedures per operating room are an acceptable approximation. Utilization of this number takes into consideration differences in the length of procedures, scheduling and turn-around time in the preparation of the operating suite for a subsequent procedure. By dividing 1,100 procedures into the 15,741 projected outpatient surgeries in 1985, there would he a need for 17 operating suites in that year. Realizing that same process of division against the 19,536 projected ambulatory surgeries in 1986, 17 plus surgery suites would be needed. At the point of hearing, there were 15 ambulatory surgery suites in the hospitals in Duval County, excluding endoscopic rooms and those rooms in which inpatients and outpatients were operated on. Eight of those rooms had capability of general anesthesia. St. Luke's, in the move of their hospital, would add two additional ambulatory surgery suites, both of which would have general anesthesia capability and both of which are under construction. The freestanding ambulatory center, Surgical Services of Jacksonville, Inc., would bring the total to 21 operating rooms with its four additional surgery rooms with general anesthesia capability. With inclusion of the St. Luke's and Surgical Center of Jacksonville, a total of 14 of the 21 operating rooms would have general anesthesia capability. This does not take into account the high number of outpatient surgery procedures which are being performed at Baptist Hospital in rooms which have an inpatient and outpatient mix, nor does it take into account future plans of area hospitals to increase their outpatient surgery capacity, which would provide even greater capacity for outpatient surgery. In summary, there is more than enough capacity to perform needed outpatient surgeries in Duval County in 1985 and 1986. Ambulatory Care and the Department have referred to the cost savings to the individual patient being treated and to the overall patient community should the Ambulatory Care Surgical Center be opened. If there was a demonstrated need for that center the proof tends to bear out the savings to the individual patient and arguably to the patient community as a whole. However, on this occasion, given the fact that the addition of Ambulatory Care's operating suites would bring the total to 25 operating rooms against the need for 17 plus operating rooms, the cost benefits to the individual patients being treated in the applicant's facility and the patient community at large, would not be realized. To the contrary, the inordinate duplication of services that would be experienced with the addition of the applicant's facility would tend to drive up health care costs in Duval County. Additionally, the applicant cannot be expected to survive financially in the overcrowded health delivery environment described in this paragraph. The innovative nature of a freestanding surgery center in matters such as ambience, related to the psychological well being of patients, especially younger patients and potential efficiency of operation of the applicant's surgical center are not sufficient to redeem its request for certificate in this instance. In a related vein, modifications to existing plans in the hospitals and the inconvenience occasioned by those adjustments are not such that those circumstances may be expected to impede the steady progress of increased outpatient ambulatory procedures in those hospitals and make them less than a viable alternative for performing the needed procedures in the 1985 and 1986 periods. Any competitive influence to be fostered by the addition of Ambulatory Care's facility would not be beneficial. Sufficient competitive influence is already present to promote quality care and cost effectiveness. Finally, if trends in outpatient surgery, particularly to be performed under general anesthesia increases beyond the predictions indicated, there is sufficient capacity in the hospitals to accommodate that eventuality by constructing new outpatient surgical suites or by conversion of inpatient surgical suites to perform outpatient surgeries to include ancillary space. This can be accomplished without having to resort to an application for certificate of need, given the $695,000 exemption or exclusion from the certificate of need review process. In view of the overburden that would be created in ambulatory surgeries by the additional capacity of the applicant, provision of needed construction of facilities is being met and can be met in the future in a less costly way then suggested by the applicant. On this occasion, the hospitals can provide more cost effective facilities. Ambulatory surgery is available and accessible in local area hospitals within Duval County in an appropriate and adequate setting. That service does not exclude any patient. Though not needed Ambulatory Care's contemplated facility addresses those contingencies set forth in this paragraph, with one proviso. That matter pertains to the fact that Ambulatory Care shall provide its services to all residents in the service area without regard for physical condition or financial standing, premised upon the willingness of the treating physician to admit those patients to the facility for treatment and subsequent screening to be done by the staff of Ambulatory Care to determine the appropriateness of that setting to achieve the surgery. This will cause a certain number of potential patients to receive their surgery in a hospital environment.
The Issue This case arises out of Orlando Regional Medical Center's objection to the issuance of a Certificate of Need to Surgical Services of Orlando, Inc., for the construction and operation of an ambulatory surgical center in Orlando, Florida. At the formal hearing, Orlando Regional Medical Center called as witnesses, Herbert E. Straughn, Norton Baker, Terry Weibley, Marlene Mariani, Michael L. Schwartz, Janice Smith, Richard Douglas Signer, Cathy Canniff Gillam, Jack Bradley, Barbara W. Miner, John Bozard and Stephen Haar. The Intervenor, Surgical Services of Orlando, Inc., called as witnesses, Steven Haar, Janice Smith, John Bozard, Michael Means, Jerry Senne, James Leveretee, Stephen Foreman, John S. Lord, Robert C. Klettner, Albert S. Bustamante, Pedro Diaz- Borden, Alberto J. Herran, Marianna Johnson, Richard Toole, Don Newton, Hank Gerken, Gordon Kiester, Leonard J. Levine, Rufus Holloway, Brenda Brinkman, Betty Barker, Wayne Deschambeau, Mark Richardson and Rick Knapp. Department of Health and Rehabilitative Services called as its only witness, Mr. Thomas Porter. Surgical Services of Orlando, Inc., offered and had admitted into evidence 33 exhibits. At the formal hearing, the Hearing Officer reserved ruling upon SSO Exhibit No. 14 and that exhibit is admitted. Orlando Regional Medical Center offered and had admitted into evidence, 9 exhibits. At the formal hearing, the Hearing Officer reserved ruling upon SSO Exhibit No. 14 and that exhibit is admitted. Orlando Regional Medical Center offered and had admitted into evidence, 9 exhibits. At the formal hearing, Orlando Regional Medical Center was given permission to file a late-filed exhibit with Surgical Services of Orlando, Inc., and the Department having the opportunity to object to said exhibit. That exhibit has been filed as Orlando Regional Medical Center Exhibit No. 9 and consists of excerpts from the Department of Health and Rehabilitative Services file relating to this application. That exhibit is admitted. The Department of Health and Rehabilitative Services offered and had admitted into evidence one exhibit. A map of Orlando reflecting the location of the various hospitals in Orange County was admitted as joint exhibit 1. Subsequent to the formal hearing, each of the parties submitted proposed findings of fact and conclusions of law for consideration by the Hearing Officer. To the extent that those proposed findings of fact and conclusions of law are inconsistent with this order, they were considered by the Hearing Officer and rejected as being unsupported by the evidence or as unnecessary to the resolution of this cause.
Findings Of Fact Surgical Services of Orlando, Inc., (hereafter referred to as SSO), is a Florida corporation based in Orlando, Florida. The stock of the corporation is owned in equal shares by Steven Foreman, Dr. Rufus Holloway and Randall Phillips. Mr. Steven Foreman is a life underwriter and financial consultant, and real estate investor in the Orlando area. He is secretary and director of SSO. Dr. Rufus Holloway is an otolaryngologist in the Orlando area and is treasurer and a director of SSO. Randall Phillips is a hospital administrator presently employed by American Medical International, Inc. Orlando Regional Medical Center, Inc. (hereinafter referred to as ORMC) is an existing hospital located in Orlando, Florida. It is a not-for-profit regional tertiary care center with 1035 beds and 24 operating rooms. ORMC has two main divisions, the Orange Division and the Holiday Division and is presently constructing a new facility, Sand Lake Division, which will open sometime in mid 1985. The Sand Lake Division will have 4 operating rooms and 150 beds. Dr. Rufus Holloway and Steven Foreman have committed their personal resources to provide financial support for the complete development and operation of the applicant's proposed ambulatory surgical center. The facility will be constructed by a partnership, the Kaley Avenue Medical Partnership of Dr. Holloway, Mr. Foreman and Richard Toole, a citrus owner in the Orlando area, and will be leased to SSO. Two banks in the Orlando area have given commitments to provide the necessary financing for the proposed facility and start-up expenses. Pan American Bank has committed to provide a $2.5 million loan for the construction and equipping of the building and $750,000 line of credit. Dr. Holloway and Mr. Foreman, and the parties of the Kaley Avenue Partnership have sufficient financial resources to fulfill their commitments to the proposed project. The proposed building will be a one floor building containing 15,000 square feet. The total cost for the project will be $2,737,636. The building is to be constructed and equipped by the Kaley Avenue Medical Partnership and leased to SSO at $16 per square foot. The proposed site of the facility is on Kaley Avenue within two or three blocks of ORMC. Its service area will include all of Orange County. The facility will contain five operating rooms with only three of the rooms being completely equipped initially. These rooms will be used for general and local anesthesia. The remaining two rooms will be equipped as demand requires. The applicant has budgeted $743,000 for initially equipping the facility with an additional $160,000 required to equip the two remaining operating rooms. The equipment proposed by the applicant is adequate to perform those procedures which the applicant proposed to perform at its facility. In addition to the five operating rooms, the center will include laboratory, x-ray, administrative areas, as well as holding and recovery areas for the patients. The applicant projects a total number of procedures in the first year of 1,800 and 2,760 in the second year of operation. Based upon a Medicare utilization rate of 15 percent SSO projects an operating loss in the first year of $223,000 with the facility making a profit in the second quarter of the second year and generating a total profit of $766,000 in the second year. The projected break-even point is 2,448 procedures within a year. Projected revenues are based upon an average charge per case of $575. SSO also intends to accept Medicaid patients. Presently, Medicaid does not reimburse freestanding ambulatory surgical centers. Medicaid charges would be included as charity cases in the projected bad debt of 6 percent of gross revenues. Based upon an inflation rate of 8 percent per annum when SSO begins operation in January, 1986, its average charge per case will be competitive with other facilities in the area providing ambulatory surgical services. Medicare now reimburses 100 percent of the facility charges in a freestanding ambulatory facility and 80 percent for outpatient surgery in a hospital setting. Prior to opening, SSO will implement a marketing program directed to four different target groups: physicians, consumers (patients), employers and insurance carriers. SSO has retained a marketing expert who has prior experience in marketing ambulatory surgical care in Florida. Similar marketing has proven successful for other freestanding ambulatory surgical centers in Florida. SSO has budgeted $20,000 for pre-opening marketing expenses and $35,000 for the first year of operation. It is difficult upon this record to make a truly accurate comparison of outpatient surgical rates in existing facilities to the proposed average charge of SSO. ORMC presented evidence that the present average charge in ORMC and three other hospitals per outpatient case is as follows: ORMC $417.19 Florida Hospital $469.86 Winter Park $512.21 Orlando General $560.81 No average charges were presented into evidence for West Orange Hospital, Lucerne Hospital, or Brookwood Hospital. The evidence established that 8 percent is a reasonable inflation or increase rate for health care charges over the next two years. Applying an 8 percent inflation rate to the above average charges these charges for 1986, SSO's first year of operation would be: ORMC $486.61 Florida Hospital 548.04 Winter Park 597.44 Orlando General 654.13 In calculating its present average charge of $417.19, ORMC did not include those outpatient surgeries performed at the Orange Division which are charged at inpatient rates. A memo dated January 19, 1984, to John Bozard, ORMC Vice President for Finance, from Steve Horr, ORMC Assistant Controller/Reimbursement, reflects that Holiday Division had 484 outpatient surgical cases which are estimated to generate gross revenues of $228,547. This results in an average charge per case for the month of December 1983 of $472.20. It is concluded that in 1986 the SSO projected average charge of $575 will be competitive with those existing facilities in the Orange County area. There is presently no rule which contains a specific methodology for determining need for ambulatory surgery centers. HRS uses a methodology which is based upon policy but has not been proposed or promulgated as a formal rule. The present methodology utilizes the total surgery cases for the most recent 12 month period to determine a surgical utilization rate per 1,000 population. By separating inpatient and outpatient surgeries for the same 12-month period, a percentage ratio of outpatient surgery cases to total surgeries is established. Applying the utilization rate to future projected population, HRS then determines the total projected surgeries for future years and from this number calculates the projected outpatient surgeries which will be performed in existing facilities. Literature relating to ambulatory surgeries projects that 18 to 40 percent of all surgical procedures performed could be performed in an outpatient setting. In calculating total potential surgeries HRS utilizes 29 percent as the potential surgeries that can be performed in an outpatient setting. The 29 percent factor is the mean of 18 percent to 40 percent and appears reasonable in light of the fact ORMC, Holiday Division, Winter Park Memorial and Orlando General had outpatient surgery of 29.4 percent, 30.1 percent and 30.6 percent respectively for 1983. Applying the 29 percent factor to projected total surgeries, HRS calculates the projected potential ambulatory surgery for a given year in the future. Subtracting those outpatient surgeries which will be performed in existing facilities from the total potential outpatient surgeries provides the unmet need for outpatient surgical care. This need is reflected in total cases. In evaluating ambulatory surgical applications, HRS utilizes a two year planning horizon. It is projected that SSO would begin operation January 1, 1986, and therefore under the HRS methodology, 1986 and 1987 become the relevant years for the HRS methodology, 1986 and 1987 became the relevant years for looking at projected need. Using the methodology described above, HRS projects the potential number of outpatient surgical cases which could be performed in other than a hospital setting to be 7,203 and 7,347 for 1986 and 1987, respectively. HRS projects the break-even level of the SSO facility at 2,693 surgical cases per year. Subtracting the SSO break-even factor from 7,203 and 7,347 results in an unmet need even after the SSO facility is in operation of 4,510 and 4,654 surgical cases in 1986 and 1987. HRS calculated the outpatient utilization rate in existing hospitals in 1983 to be 15.3 percent. If the unmet need of 4,510 and 4,654 in 1986 and 1987 was met by these existing facilities, that utilization rate would increase to 24 percent or approximately 1 1/2 times the 1983 rate. The projected utilization for the SSO facility for 1986 and 1987 will constitute only about 20 percent and 30 percent respectively of the unmet need for outpatient surgery in those years. The applicant in projecting need used a five year planning horizon to project need for ambulatory surgical services in Orange County for the year 1989. Under SSO's methodology, an outpatient utilization rate of 30 percent, 35 percent and 40 percent was used to project the total potential outpatient or ambulatory surgeries for the year assuming a total surgical utilization rate of 101.45 cases per thousand. Using these assumptions, the applicant projected unmet need for ambulatory surgeries in Orange County in 1989 as: Percentage of Ambulatory Surgery Unmet Need 30% 6,357 35% 9,246 40% 12,136 Although the projected unmet need is somewhat lower than that projected by HRS, it does reflect a need for the SSO facility. The methodology used by ORMC utilizes what ORMC's experts described as the "excess capacity theory." This methodology is based upon the assumption that no need exists for an ambulatory surgical center until such time as all excess capacity in the existing operating suites in Orange County is utilized. Using this approach, ORMC contends that of the 79 total operating suites in Orange County, there are presently 39 excess operating suites available to perform outpatient surgery. By multiplying total number of hours per day per operating room times 260 days, ORMC calculates the total available hours of operation of an operating suite and by multiplying this number times the total number of suites, the total available hours or operating room time for a facility is determined. The total available hours is then divided by the average operating room time for all procedures performed to determine the total number of potential procedures. Using this approach, ORMC's expert opined that there is potential for 95,513 - 98,980 total surgical cases in the existing 79 operating rooms in Orange County These 79 rooms include the 4 new operating suites in ORMC's Sand Lake facility as well as the 4 suite in Florida Hospital's new freestanding ambulatory surgical center. Subtracting the total procedures of 47,712 from the potential capacity, ORMC projects an available excess capacity for growth of 47,801 to 51,268 surgical cases in Orange County. Also using total available hours, hours per average procedure and total hours required for procedure presently being performed, ORMC's expert calculated the number of operating suites presently required. By subtracting this number from the number of existing suites, the ORMC expert concluded that there are presently 39 excess operating suites in Orange County. Once the ORMC Sand Lake facility and the Florida Hospital Freestanding Ambulatory Center (FAC) open, there will be a total or 79 operating suites in Orange County. These are divided as follows: ORMC, Orange Division 14 ORMC, Holiday Division 10 Winter Park Memorial 10 Orlando General 4 West Orange 3 Lucerne 8 Brookewood 5 Florida Hospital 17 Florida Hospital, FAC 4 ORMC, Sand Lake 4 79 At present, ORMC, Holiday Division, is the only facility operating dedicated ambulatory surgical suites. There are no applications pending for dedicated outpatient facilities within hospitals or for a freestanding ambulatory surgical facility. No such applications have been filed for these types of facilities since the SSO application was filed. Each of the existing facilities listed above performs outpatient surgery to some degree. On August 16, 1982, Florida Hospital was issued a Certificate of Need to construct a freestanding ambulatory surgical center. That facility will contain four operating suites and is expected to begin operation in mid 1984. Once this facility is complete, Florida Hospital will not perform outpatient surgery in its 17 other suites, except when special equipment which is available only in those suites is required. Outpatient surgery at Winter Park Memorial and Orlando General now comprises approximately 30 percent of the total surgeries performed at those facilities. Lucerne Hospital operates no separate ambulatory surgery unit and favors SSO's application. ORMC has been performing outpatient surgery for over 20 years. However, the specific facilities in which outpatient surgery has been performed have changed during this period of time. Prior to August 1979, outpatient surgery was performed at the Five North unit in the Orange Division as well as at the Holiday Division. At that time, Orange Five North was closed for renovation and outpatient surgery was concentrated in Holiday One East. In October 1981, an outpatient surgery review committee was established by ORMC to examine more efficient ways to conduct outpatient surgery and to improve utilization of certain departments at the Holiday Division. The end result was a decision to concentrate outpatient surgery at ORMC in one designated unit to be known as Outpatient Day Surgery ("ODS"), and to provide a financial incentive for physicians and patients to utilize the unit. One of the primary reasons for concentrating outpatient surgery in Holiday One East was the inefficiency and increased cost of staffing the units. Outpatient census counts were resulting in overstaffing the 3 to 11 shift. To encourage doctors and patients to utilize Holiday One East, ORMC reduced the rates for outpatient surgery in the ODS unit by approximately 40 percent. Although some outpatient surgery continues to be performed at the Orange Division the charge for such surgeries is at the inpatient rates rather than the reduced rates utilized by the ODS. The ORMC Board of Directors approved the capital expenditure to renovate the Holiday One East area into the ODS unit on September 20, 1982. The ODS unit was renovated at a cost of approximately $600,000, which was below the Certificate of Need threshold requirement. The ODS unit opened on November 28, 1983. The ODS unit is open Monday through Friday, and utilizes a ten hour day with general anesthesia administered to outpatients from 7:30 a.m. to 1:00 p.m. ODS patients use a separate and distinct entrance to the Holiday Division and have a designated parking area east of the hospital. There are sixteen semi- private holding beds and four recliner chairs located within the ODS unit. The average case load and length of stay are such that holding beds may be used for more than one outpatient per day. As a result of instances where there have been shortages of holding beds for outpatients, ORMC beginning April 2, 1984, established an overflow area of ten beds on the third floor of the Holiday Division. As of May 29, 1984, this overflow area had been utilized on three occasions. The ODS unit contains two dedicated operating rooms where only local anesthesia can be administered. Outpatient procedures requiring general anesthesia are performed in the eight general operating suites of the Holiday Division. These eight operating suites are also used for inpatient surgery. Outpatients are placed in the same holding and recovery areas where inpatients are held. The staff in these areas serve inpatients and outpatients. The ODS unit averages 15 to 16 outpatients per day. In 1983, outpatient surgery comprised 29.4 percent of the total surgeries performed at the Holiday Division. This was a slight increase over the 27.7 percent outpatient percentage for that same division for the previous year. Presently, the two dedicated local anesthesia rooms are being utilized approximately 40 percent of the time. The present utilization rate of the entire Holiday Division is approximately 50 to 55 percent to as much as 80 percent depending upon the particular day of the week. The 80 percent rate is attained on a regular basis at least once per week. ORMC has been issued a Certificate of Need for a children's hospital. As presently designed and approved, the construction of the children's hospital will require the demolition of Holiday One East where the ODS unit is located. It is uncertain where the ODS unit would be relocated. The master facility plan approved by the ORMC Board of Directors includes the construction of a freestanding ambulatory diagnostic center which will include ambulatory surgery. Depending upon the staff and its efficiency and the quality of care provided, a freestanding ambulatory center offers several advantages over outpatient units within hospitals. In such a freestanding facility, only outpatient surgery is performed and the staff and physicians, including anesthesiologists, can be specialized in outpatient surgery. In the freestanding facility, outpatients are not mixed with inpatients. A substantial portion of those patients utilizing outpatient surgery are well patients having elective surgery performed. By specializing in outpatient surgery only, overall operating costs are likely to be less and should result in reduced patient costs. In a hospital setting, there is on occasion a problem with "bumping" elective surgery for emergencies. This would not occur in a freestanding ambulatory surgery facility. Patients will have shorter waits in the facility and Medicare patients will be reimbursed 100 percent rather than the 80 percent reimbursed in a hospital setting. The 550 application is consistent with the applicable criteria enumerated in Section 381.494(6)(c), Florida Statutes and need for its facility exists in Orange County. Of the thirteen governing criteria, the parties have stipulated that the criteria contained in Subsections 6, 7, 10 and 11 of Section 381.494(6)(c), Florida Statutes, are not applicable to this proceeding. In addition, the parties stipulated that Subsection 1 of Section 381.494(6)(c), Florida Statutes, is not applicable to this proceeding to the extent that there is no applicable district health plan or state health plan pertaining to ambulatory or outpatient surgery.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is, RECOMMENDED That HRS issue a Certificate of Need to Surgical Services of Orlando, Inc., to construct and operate a freestanding, five operating room ambulatory surgery center in Orange County. DONE AND ENTERED this 2nd day of July, 1984, in Tallahassee, Florida. MARVIN E. CHAVIS 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 3rd day of July, 1984. COPIES FURNISHED: Douglas L. Mannheimer, Esq. CULPEPPER, TURNER & MANNERED 318 North Call on Street Tallahassee, Florida 32302-3300 Fred W. Baggett, Esq. ROBERTS, BAGGETT, LaFACE, RICHARD, & WISER P.O. Drawer 1838 Tallahassee, Florida 32302 E. G. Boone, Esq. P.O. Box 1596 Venice, Florida 34284 Steven R. Bechtel, Esq. MATEER, HARBERT, FREY BECHTEL AND PHALIN, PA P.O. Box 2854 Orlando, Florida 32802 P. Joseph Wright, Esq. MURRAH AND DOYLE, P.A. P.O. Box 1328 Winter Park, Florida 32790 David Pingree, Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32301
The Issue Whether Respondent, a medical doctor, in his treatment of Patient M.A., failed to keep legible medical records in violation of section 458.331(1)(m), Florida Statutes (2007); prescribed or administered inappropriate or excessive quantities of controlled substances in violation of section 458.331(1)(q), Florida Statutes (2007); committed medical malpractice by practicing below the standard of care in violation of section 458.331(1)(t), Florida Statutes (2007); failed to perform a statutory or legal obligation placed upon a licensed physician in violation of section 458.331(1)(g), Florida Statutes (2007); and violated any provision of chapter 458 or chapter 456, or any rules adopted pursuant thereto in violation of section 458.331(1)(nn), Florida Statutes (2007), as Petitioner alleges in the Third Amended Administrative Complaint; if so, whether (and what) disciplinary measures should be imposed.
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 Paul M. Goldberg, M.D., violated sections 458.331(1)(g) and (nn), Florida Statutes, as charged in Counts IV and V of the Complaint; Dismissing Counts I-III of the Complaint; Imposing $20,000 in administrative fines; issuing a reprimand against Dr. Goldberg's medical license; requiring Dr. Goldberg to complete the "Laws and Rules" Course; suspending Dr. Goldberg's medical license until such time as Dr. Goldberg undergoes a "UF CARES" evaluation; and placing Dr. Goldberg's license on probation for three years under indirect supervision with 100 percent chart review of cosmetic surgery patients and 25 percent chart review of all other patients. DONE AND ENTERED this 4th day of March, 2015, in Tallahassee, Leon County, Florida. S TODD P. RESAVAGE 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 4th day of March, 2015.
The Issue The issues for determination are whether Respondent violated Subsections 458.331(1)(f) and (m), Florida Statutes (1997), by assisting an unlicensed person to practice medicine contrary to Chapter 458 and by failing to maintain adequate medical records; and, if so, what discipline, if any, should be imposed against Respondent's license. (All references to chapters and statutes are to those promulgated in Florida Statutes (1997) unless otherwise stated.)
Findings Of Fact Petitioner is the state agency responsible for regulating the practice of medicine in Florida. Respondent is licensed to practice medicine in Florida pursuant to license number ME 0015824. Respondent owns and operates an ambulatory surgical center doing business as the Dermatologic & Cosmetic Surgery Center (Surgery Center). The Surgery Center is located at 2666 Swamp Cabbage Court, Fort Myers, Florida 33901. Respondent is a Board-certified Dermatologist and also performs cosmetic surgery that includes breast augmentation. Dermatology and cosmetic surgery involve similar procedures. The procedures used to remove skin cancers from the face are similar to those used in face-lifts and eyelid surgery. Respondent performs approximately a thousand skin cancer surgeries a year, has been doing cosmetic surgery since 1986, and has practiced breast surgery since 1989. Respondent is a member of the American Board of Cosmetic Surgery. That board is not approved by the American Board of Medical Specialties or the Florida Board of Medicine. Respondent has attended numerous seminars and satisfied relevant continuing education requirements throughout his career. Respondent has never been sued by a patient and has no prior discipline against his license. Prior to August 12, 1997, Respondent performed breast augmentations through the patient's nipple. Respondent made a small incision in the lower part of the binary nipple. He used his fingers to separate the overlying breast tissue from the muscle and create a pocket in which to place an implant. The incision left a scar at the nipple, and Respondent sought to develop competency in a different procedure identified in the record as the axillary method of breast augmentation. The axillary method allows the surgeon to access the breast from the patient's armpit. The surgeon makes a 1.5 inch incision under the armpit, uses an instrument to create a pocket in the breast, inserts a partially inflated implant into the pocket, and repeats the same procedure in the other breast. The surgeon then checks the breasts for symmetry, fills the implants, closes the pockets, and concludes the procedure. In the axillary method, a surgeon must use instruments rather than his fingers to create a pocket for the implant. The initial incision and placement of the implant do not require great skill. The greater skill is required in reaching the proper plane in the breast tissue and in creating the pocket. The brachial plexis is just below the incision in the armpit and contains all of the nerves that make the arm work. From the armpit, the surgeon must proceed over the sternum. If the surgeon applies too much pressure, the surgeon can cross the center of the chest and create a condition known as a unibreast. Respondent developed a basic understanding of the axillary method by watching video tapes for several years and by attending seminars approved for professional education credit in the State of Florida. In May of 1997, Dr. Daniel Metcalf taught one of those seminars in Orlando, Florida. Dr. Metcalf is licensed to practice medicine in Oklahoma. He is qualified by training and experience to perform the axillary method and to teach the method to other physicians. For approximately 25 years, Dr. Metcalf has limited his medical practice to breast surgery and performs approximately 650 surgeries each year. At the time that Dr. Metcalf taught the accredited seminar in Orlando, his license to practice medicine in Oklahoma was suspended. On November 13, 1995, Dr. Metcalf pled guilty to a felony charge that he violated federal interstate commerce law by selling silicon implants during a moratorium on their sale. The federal court fined Dr. Metcalf $5,000 and sentenced him to six months in federal prison beginning on April 5, 1996. The State of Oklahoma suspended Dr. Metcalf's medical license for one year beginning on the date of his release from prison. The suspension expired on or about October 5, 1997. In May of 1997, Respondent discussed the axillary method with Dr. Metcalf during the seminar in Orlando. Respondent and Dr. Metcalf had known each other since the early 1980s, and Dr. Metcalf agreed to come to the Surgery Center and teach the axillary method to Respondent. Respondent scheduled the teaching session at the Surgery Center for August 12 and 13, 1997. Five of Respondent's patients agreed to participate. The patients are identified in the record as B.D., T.R., R.K., M.P., and D.C. Each patient acknowledged in writing that it would be the first time Respondent would perform the axillary method. Neither Respondent nor Dr. Metcalf charged the patients for a surgeon's fee, and Dr. Metcalf did not charge Respondent. However, the patients paid the costs of the implant, the operating room, and the blood work. Respondent conducted a preoperative interview with each patient. He advised the patient that Dr. Metcalf would be in the operating room teaching Respondent. On August 12 and 13, 1997, Respondent introduced Dr. Metcalf to each patient. Respondent and Dr. Metcalf then scrubbed, gloved, and proceeded with the teaching session. Dr. Metcalf performed approximately 60 to 70 percent of the first surgery. Respondent performed progressively more of each successive surgery until Respondent performed the vast majority of the surgery. The surgery that Dr. Metcalf performed included at least one incision and pocket, insertion of an implant, use of the appropriate surgical instruments, and closure of an incision on at least one patient. Neither Respondent nor Dr. Metcalf caused any harm to a patient. The results of all five procedures were positive and without complication. No patients complained about their treatment. Two of Respondent's former employees are the complaining witnesses in this case. The first issue is whether Dr. Metcalf practiced medicine within the meaning of Section 458.305(3). Section 458.305(3) defines the "practice of medicine" as: [T]he diagnosis, treatment, operation, or prescription for any human disease, pain, injury, deformity, or other physical or mental condition. Dr. Metcalf did not diagnose, treat, or prescribe medicine for any human disease, pain, injury, or deformity, or mental condition. The breast augmentations that he participated in were elective and cosmetic and did not treat any disease, pain, injury, or deformity. Dr. Metcalf must have performed an "operation" for some "other physical . . . condition" in order to practice medicine within the meaning of Section 458.305(3). Respondent's counsel argued during the hearing that the issue of whether Dr. Metcalf practiced medicine was an issue of law, rather than fact. Counsel argued that expert testimony would invade the province of the ALJ. If Respondent's counsel were correct, the result could be problematic for Section 90.702. Although a physician would be qualified by training and experience to opine that a peer's activities satisfy the standard of care applicable to the practice of medicine, the physician would not be qualified to know whether he or his peer practiced medicine. In an abundance of caution, the ALJ requested the parties to cite relevant legal authority in their respective PROs. Neither party cited any direct or analogous legal authority that resolves the issue raised by Respondent's counsel or construes the statutory definition of the practice of medicine in Section 458.305(3). Each party submitted expert testimony concerning the issue of whether Dr. Metcalf practiced medicine. As the trier of fact and arbiter of credibility, the ALJ must resolve the evidential conflicts between the experts. Accordingly, the fact finder has carefully considered the substance of the testimony of the two experts and determined the appropriate weight to be accorded the testimony of each. Respondent's expert based his opinion on a custom within the medical profession in which unlicensed persons, such as members of an emergency medical team, medical students, and first year residents, train under a physician. Respondent's expert opined that an unlicensed person does not practice medicine because the person is learning under the auspices of a physician who has responsibility for the unlicensed person. Respondent's expert relied on facts not in evidence. Unlike the custom described by Respondent's expert, the evidence shows that the person teaching was not licensed to practice medicine in the state where the teaching occurred. The person learning was the only person so licensed. While Respondent had ultimate responsibility, Respondent was not teaching Dr. Metcalf. Dr. Metcalf was teaching Respondent. The custom described by Respondent's expert operates within a framework of laws and rules that are inapposite to this case. Residents who are not licensed to practice medicine in Florida may practice under the supervision of a physician only if the residents, and the hospitals in which they work, comply with registration and reporting requirements in Section 458.345 and Florida Administrative Code Rules 648-6.008 and 6.009. None of those provisions apply to the facts in this case. (All references to rules are to those promulgated in the Florida Administrative Code on the date of this Recommended Order.) Respondent's expert also testified that doctors customarily teach other doctors in states where the teaching doctor is not licensed. In Florida, however, that custom is limited by Section 458.303(1)(b) to activities that satisfy the definition of a consultation. A consultation is defined in Rule 64B8-2.001(8) to include the taking of a medical history, the examination of a patient, the review of laboratory tests and x-rays, and the making of recommendations to a person licensed to practice medicine in Florida. A consultation is not a set of activities separate and apart from the practice of medicine. It is a subset of the "practice of medicine" in Section 458.305(3). The opinion of Respondent's expert is limited, by operation of law, to that part of the practice of medicine that is a consultation within the meaning of Section 458.303(1)(b) and Rule 64B8-2.001(8). That part of the practice of medicine that is not a consultation is the practice of medicine that is at issue in Section 458.331(1)(f). Further references in this Recommended Order to the "practice of medicine" refer to those activities described in Section 458.305(3) that are not a consultation within the meaning of Section 458.303(1)(b) and Rule 64B8-2.001(8). Some of the activities engaged in by Dr. Metcalf at the Surgery Center satisfied the definition of a consultation. Other activities comprised the practice of medicine. The proportion of each is not material in this case. Dr. Metcalf performed at least 60 percent of the first "operation" for some "other physical . . . condition" within the meaning of Section 458.305(3). Dr. Metcalf practiced medicine progressively less with each successive operation and performed progressively more consultation. One purpose of the teaching session was for Dr. Metcalf to first demonstrate the axillary method and then to assist Respondent in the practice of that medicine. As it turned out, this purpose was more qualitative than quantitative because Respondent quickly demonstrated competency. However, if it were unnecessary for Dr. Metcalf to first demonstrate the axillary method, Respondent could have gained the competency he sought by reviewing video tapes, attending seminars, and consulting with Dr. Metcalf. Respondent aided, assisted, procured, or advised Dr. Metcalf to engage in the practice of medicine for at least 60 percent the first surgery performed on August 12, 1997. The next issue is whether Dr. Metcalf was an "unlicensed person" within the meaning of Section 458.331(1)(f). Chapter 458 commonly uses the term "licensed" to refer to persons licensed outside of Florida. For example, Section 458.303(1)(b) refers to physicians "licensed" in another state. Section 458.3115(1) authorizes restricted licenses for "foreign- licensed" persons. Section 458.313(1)(c) authorizes licensure by endorsement for those "licensed" in another jurisdiction, and Section 458.315 authorizes a temporary certificate for persons "licensed" in any other state. Dr. Metcalf was a licensed person in Oklahoma when he practiced medicine at the Surgery Center in August of 1997. A person licensed to practice medicine is not an "unlicensed person" while the person's license is suspended. A contrary finding could be problematic under Florida law. If a person with a suspended Florida license were an unlicensed person during the suspension and the person violated the terms of the suspension, the person would have no professional license against which the Board of Medicine could take further disciplinary action, including revocation of the license. Rather, the Board would be required to seek criminal prosecution pursuant to Section 458.327(1)(a). During the period of suspension, Dr. Metcalf was a licensed person in Oklahoma. However, Dr. Metcalf was not authorized to exercise any privileges under the license or to enjoy the benefits of his license until the suspension expired. Section 458.331(1)(f) does not prohibit Respondent from aiding, assisting, procuring, or advising an unauthorized person to practice medicine. Such a statutory prohibition would have been broad enough to proscribe the practice of medicine by a licensed person whose authority to practice was temporarily suspended. Rather, Section 458.331(1)(f) prohibits Respondent from "aiding, assisting, procuring, or advising any unlicensed person" to practice medicine. (emphasis supplied) Relevant terms in Section 458.331(1)(f) must be construed strictly in favor of the licensee because this is a license disciplinary proceeding that is penal in nature. A finding that Dr. Metcalf was a licensed person in Oklahoma does not resolve the issue of whether Dr. Metcalf was an unlicensed person for the purposes of Section 458.331(1)(f). An "unlicensed person" in Section 458.331(1)(f) is properly defined by reference to Section 458.327(1)(a). Section 458.331(1)(f) prohibits Respondent from "aiding, assisting, procuring, or advising an unlicensed person to practice medicine contrary to this chapter " (emphasis supplied). Section 458.327(1)(a) prohibits the practice of medicine without "a license to practice in Florida." When the term "unlicensed person" in Section 458.331(1)(f) is harmonized with Section 458.327(1)(a), an "unlicensed person" means a person not licensed in Florida. 44. Sections 458.327(1)(a) and 458.331(1)(f) operate in concert. The former proscribes the practice of medicine inside this state without a Florida license. The latter prohibits a person licensed inside the state from assisting in the violation of the former. In August of 1997, Respondent violated Section 458.331(1)(f) by assisting an unlicensed person to practice medicine contrary to Section 458.327(1)(a). Respondent did not intentionally violate Section 458.331(1)(f) and had no prior knowledge of the violation. The cause of the violation is rooted in multiple instances of miscommunication, confusing circumstances, and statutory ambiguity that Respondent did not create. Respondent undertook reasonable efforts to comply with Florida law. Prior to the surgeries, Respondent contacted Ms. Anne Dean. Ms. Dean is the licensed risk manager for the Surgery Center and is qualified by training and experience to advise Respondent in matters of regulatory compliance. Ms. Dean owns and operates a risk management company in Deland, Florida. She is the certified risk manager for over 450 domestic and foreign ambulatory surgery centers. Ms. Dean provides a wide range of services including financial feasibility analysis and the processing of certificates of need. She also provides services to ensure that architectural design, equipment lists, inventories, and policies and procedures comply with applicable state and federal regulatory requirements. Ms. Dean also assists ambulatory surgical centers with other license certification, accreditation, and regulatory matters. Since 1988, Ms. Dean has been the risk manager required under state law for the Surgery Center. Ms. Dean was responsible for the Surgery Center's state licensure and Medicare certification. She has been present during each license and risk management survey conducted by the Agency for Health Care Administration (AHCA). AHCA has never cited the Surgery Center for a violation. Ms. Dean has assisted Respondent in ensuring that renovations to the Surgery Center complied with applicable regulations and, except for the calendar year 2000, has advised Respondent in all matters of regulatory compliance and accreditation. Respondent asked Ms. Dean to ensure that the teaching session to be conducted by Dr. Metcalf complied with applicable state law and any accreditation requirements. Ms. Dean spoke by telephone with unidentified representatives of both AHCA and Petitioner. The advice from those representatives was consistent for two areas of concern. The first area of concern involved the accreditation needed for Respondent to be certified to perform the axillary method. Pursuant to the advice of the agency representatives, Ms. Dean created a surgical proctor report and gave the form to Respondent. After the teaching session, Dr. Metcalf completed a report for each patient and provided the reports to Ms. Dean. Ms. Dean reviewed the reports and met with a three-member committee for the Surgery Center. The committee certified Respondent as qualified to perform the axillary method. The second area of concern involved the status of Dr. Metcalf's license to practice medicine. Respondent was specifically concerned that Dr. Metcalf was not licensed to practice medicine in Florida and that Dr. Metcalf's Oklahoma license was suspended. Respondent requested Ms. Dean to ensure that the teaching session complied with Florida law. Ms. Dean conferred with representatives for Petitioner and AHCA. Ms. Dean advised Respondent that if the person teaching were licensed in another state, the person would be entitled to practice medicine in Florida during the teaching session under the auspices of Respondent, a licensed person in Florida. However, if the person teaching were not licensed in another state, the person could not perform any function that required licensure. Ms. Dean conveyed the advice of the agency representatives to Respondent. The advice from those qualified by training and experience in regulatory compliance is consistent with an educational custom among practitioners. It is common for doctors to practice medicine for educational purposes in states where they are not licensed. Before Respondent began cosmetic surgery, Respondent spent four one-week periods with two different cosmetic surgeons in Texas and Virginia. Respondent was not licensed to practice in Virginia. Respondent obtained similar experience in California where he is not licensed. Respondent is 66 years old and did not attempt to become board certified in plastic surgery. That certification would have required two or three years of general surgery and plastic surgery. Respondent would have spent his time learning complex reconstructive procedures, including cleft lips and pallets, rather than simpler cosmetic surgery. The advice from Ms. Dean and representatives for Petitioner and AHCA was incorrect and based on a mistake of law. The statement that a person licensed in another state can do more than consult in Florida purports to amend or modify the limited authority in Section 458.303(1)(b) as well as the prohibitions in Sections 458.331(1)(f) and 458.327(1)(a). An agency cannot amend, enlarge, or deviate from a statute. The mistake of law arose from ambiguity in Chapter 458. Chapter 458 does not define the term "unlicensed person." An "unlicensed physician" is defined in Rule 64B8-6.001 to mean a medical doctor not licensed by the Board of Medicine. However, the term "unlicensed physician" applies only to Section 458.345 and does not apply to Section 458.331(1)(f). The law implemented in Rule 64B8-6.001 is limited to Section 458.345. The rule refers only to interns, residents, and fellows in a hospital setting. Rule 64B8-6.001 does not define an "unlicensed physician" for any purpose in Chapter 458 except Section 458.345. A broader reading of Rule 64B8-6.001 would conflict with the definition of a "physician" in Section 458.305(4). Section 458.305(4) defines a "physician" to mean a person licensed by the Board of Medicine. The rule defines an "unlicensed physician" as a medical doctor not licensed by the Board. Even if the rule were construed to imply that a medical doctor is not a person, for purposes of Section 458.305(4), the implication would not avoid the apparent oxymoron. Any ambiguity between Section 458.305(4) and Rule 64B8-6.001 must be resolved in a manner that effectuates the statute. Section 458.305(4) defines a physician "as used in this chapter. . . ." (emphasis supplied) Neither the definition of an "unlicensed physician" in Rule 64B8-6.001 nor the definition of a "physician" in Section 458.305(4) defines the term "unlicensed person" in Section 458.331(1)(f). Chapter 458 does not expressly state that a person licensed to practice medicine in another state is an "unlicensed person." Moreover, Chapter 458 uses the term "licensed" interchangeably to mean persons licensed inside and outside of Florida. The correct meaning of the term "unlicensed person" is not found in a single provision in Chapter 458. A licensee must glean the meaning from reading Sections 458.427(1)(a) and 458.331(1)(f) in a manner that harmonizes the two provisions. The following hypothetical further illustrates the unintended ambiguity in Chapter 458. If Dr. Metcalf were licensed in Florida in August of 1997, Section 458.331(1)(f) would not have prohibited Respondent from assisting Dr. Metcalf to practice medicine contrary to Chapter 458, including gross and repeated malpractice. Section 458.331(1)(f) does not prohibit Respondent from helping a licensed person to violate Chapter 458. Statutory ambiguity also exists in the distinction between a consultation and other activities defined as the practice of medicine. Although Chapter 458 recognizes a legal distinction between the two kinds of activity, the practical distinctions evidently ebb and flow on a daily basis through a custom in which practitioners teach others in states where the practitioners are not licensed. The ambiguity in Chapter 458 gave rise to, confusion, mistakes of law by individuals qualified by training and experience in regulatory compliance and miscommunications to Respondent. Respondent reasonably relied on the advice of those qualified by training and experience to advise him in his attempt at regulatory compliance. Respondent did not intend to violate Section 458.331(1)(f). The remaining issue for determination is whether Respondent maintained adequate records for the teaching session at the Surgery Center. The statutory requirement for adequate medical records is set forth in Section 458.331(1)(m). In relevant part, Section 458.331(1)(m) provides that Respondent's license is subject to discipline if Respondent fails: [T]o keep . . . medical records that identify the licensed physician or the physician extender and supervising physician by name and professional title who is or are responsible for rendering . . . supervising, or billing for each . . . treatment procedure and that justify the course of treatment of the patient. (emphasis supplied) The parties do not dispute that the medical records adequately identify Respondent. The contested issue is whether the medical records justify the course of treatment by adequately identifying Dr. Metcalf by name and title. The medical records include operative reports that identify Respondent by name but do not identify Dr. Metcalf. Petitioner argues that Section 458.331(1)(m) requires the operative reports to identify both Respondent and Dr. Metcalf. Petitioner argues that Respondent was the "licensed physician" and Dr. Metcalf was the "physician extender and supervising physician." Dr. Metcalf was neither the "physician extender" nor the "supervising physician" during the teaching session. Section 458.305(4) defines a physician as a person who is licensed by the Board of Medicine. Dr. Metcalf was not licensed by the Board and was not a physician under Florida law. Respondent was the "licensed physician." Petitioner admits that the medical records adequately identify the "licensed physician" in accordance with Section 458.331(1)(m). If the definition of a physician in Section 458.305(4) were disregarded, the ALJ agrees with Petitioner that Section 458.331(1)(m) implicitly distinguishes a "licensed physician" from a "physician extender and supervising physician." However, the implicit distinction does not serve the ends that Petitioner seeks. Rather, the implicit distinction suggests that the physician extender and supervising physician may be someone other than a licensed physician. If the implied distinction in Section 458.331(1)(m) were correct, it would need to be construed in pari materia with Section 458.331(1)(f) in a manner that gives force and effect to both subsections. The prohibition in Section 458.331(1)(f) could not prohibit Respondent from assisting an unlicensed person who is "physician extender and supervising physician" without nullifying the implied distinction in Section 458.331(1)(m). The interplay between Subsections 458.331(1)(f) and (m) does not alter the outcome of this case. However, it further elucidates the statutory ambiguity that Respondent, his risk manager, and two different agency representatives faced in attempting to ascertain whether the teaching session complied with Florida law. Assuming arguendo that Petitioner's view of Dr. Metcalf as the physician extender and the supervising physician were correct, Petitioner's statutory interpretation conflicts with the literal terms of Section 458.331(1)(m). Section 458.331(1)(m) requires the medical records to identify either the licensed physician or the physician extender and supervising physician. The statute does not require the medical records to identify the licensed physician and the physician extender and supervising physician. Relevant terms in Section 458.331(1)(m) must be construed strictly in favor of the licensee because this is a license disciplinary proceeding that is penal in nature. If it were determined that Dr. Metcalf could be a physician extender without being a physician defined in Section 458.305(4), no statute or rule cited by the parties defines a "physician extender." Although the term may be a term of art within the medical profession, Petitioner failed to adequately explicate that form of art. The evidence was less than clear and convincing that Dr. Metcalf was a physician extender. If it were determined that Dr. Metcalf could be a supervising physician without being a physician defined in Section 458.305(4), the definitions of "direct supervision and control" and "direct responsibility" in Rule 64B8-2.001(1) and (6) and Rule 64B8-4.026(1) aren't probative. The rules merely define the quoted terms by reference to physical proximity. Both Respondent and Dr. Metcalf were physically proximate. The evidence shows that Respondent was ultimately responsible for the surgeries. Respondent had actual control of each surgery, could have stopped each surgery at any time, and was responsible for billing each patient. Unlike the operative reports, the anesthetist reports identify Respondent and Dr. Metcalf by name and title. The parties agree that the anesthetist reports are part of the medical records. Petitioner argues that the identification of Dr. Metcalf solely in the anesthetist reports is inadequate. Petitioner claims the operative reports must also identify Dr. Metcalf. Each party submitted expert testimony concerning the issue of whether the identification of Dr. Metcalf solely in the nurse anesthetist reports was adequate. Petitioner's expert was tendered and accepted "as a physician, in general, and as a plastic surgeon." Respondent's expert practices emergency medicine, rather than cosmetic or plastic surgery, but is an expert in quality assurance. Respondent's expert is better qualified by training and experience, within the meaning of Section 90.702, to assist the trier of fact in a determination of whether the medical records are adequate. The testimony of Respondent's expert is consistent with the record-keeping requirements in Section 458.331(1)(m) and Rule 64B8-9.003. Neither the statute nor the rule requires medical records to identify Dr. Metcalf in multiple parts of the medical records or to identify Dr. Metcalf in any specific document. The anesthetist reports comprise adequate medical records that identify both Respondent and Dr. Metcalf. Petitioner argues that the patient consent forms do not identify Dr. Metcalf; and that Respondent did not tell his patients that Dr. Metcalf would be operating on them or that Dr. Metcalf's license to practice medicine was suspended. No finding is made concerning these issues because they are not relevant to any allegation contained in the Administrative Complaint. The Administrative Complaint does not allege that Respondent failed to obtain informed consent from his patients. If it were determined that Section 458.331(1)(m) requires the operative reports to identify Dr. Metcalf when the anesthetist reports already do so, Respondent did not cause the omission of Dr. Metcalf's name from the operative reports. Respondent instructed his circulating nurse and surgical supervisor (circulating nurse) to identify Dr. Metcalf in the operative reports that Respondent signed but did not read. The regular duties of the circulating nurse included the identification of surgeons in the operative reports. Respondent reasonably relied on the circulating nurse to perform her assigned duties correctly. The Administrative Complaint does not charge Respondent with failure to supervise his employee or with failure to review the operative reports he signed. The circulating nurse failed to identify Dr. Metcalf in the operative reports she prepared for Respondent. Sometime after the teaching session in August of 1997, the circulating nurse abruptly terminated her employment at the Surgery Center following several employment problems. When Respondent hired the circulating nurse in July of 1996, she was in an impaired physician or nurses (IPN) program for treatment of a previous addiction to Xanex and Demerol that she developed during her divorce. However, representatives of the IPN program assured Respondent that the circulating nurse was successfully completing the program. After the circulating nurse terminated her employment, Respondent discovered that drugs were missing from the Surgery Center. Respondent also learned that the circulating nurse had stopped going to the IPN program in August of 1997 and had stopped taking her urine tests. In October, 1997, the IPN program dismissed the circulating nurse. Sometime between August 13 and September 11, 1997, the circulating nurse told Respondent that she suspected the anesthetist of being addicted to drugs because he was falling asleep during surgeries. The circulating nurse also thought some drugs were missing from the Surgery Center. Respondent barred the anesthetist from further surgeries and asked the circulating nurse to conduct a drug count. Respondent left the next day with his wife on a previously scheduled vacation but stayed in communication with the circulating nurse. The circulating nurse conferred with the risk manager and conducted a drug count but did not comply with prescribed procedures. The circulating nurse entered her drug count on a form but did not make any written findings. The circulating nurse told Respondent that she thought some drugs were missing. Respondent requested the circulating nurse to fax him the portion of the Surgery Center manual that prescribed drug audit procedures. The circulating nurse faxed the material and then terminated her employment. When Respondent returned from his vacation, the office keys used by the circulating nurse were in Respondent's mailbox. The circulating nurse quit her job because she felt Respondent expected too much of her. Prior to January 1998, Respondent requested a pharmacy consultant to assist Respondent and his wife in a second narcotic count. The pharmacy consultant confirmed that some drugs were missing from the Surgery Center. The missing drugs included Versed, Demerol, Tylox, and Valium. Respondent reported the missing drugs to the risk manager, and the risk manager reported the incident to the state. The appropriate state agency began an investigation in January of 1998 that included the potential involvement of the anesthetist and the circulating nurse. The anesthetist died shortly after January 1998, and the agency concluded the investigation without charging the circulating nurse. The circulating nurse and Respondent's former insurance secretary are the complaining witnesses in this case. On September 11, 1997, the insurance secretary altered the computer entrees for the employee manual so that the number of hours needed to be eligible for insurance benefits conformed to the number of hours that the insurance secretary worked. Respondent's wife is the office administrator. She discovered the changes and corrected them. She then instructed the insurance secretary not to come into the Surgery Center while Respondent was on vacation. When Respondent and his wife returned from their vacation, they discovered that the insurance secretary had copied all of the patient charts for August 12 and 13, 1997, and had resigned from her job. Neither Respondent nor his wife could locate any of the copied charts. The proctor forms that had been completed by Dr. Metcalf and reviewed by the risk manager and accreditation committee were missing from their files. Whole parts of the surgery manual were missing. The risk manager conducted an independent search for the missing records without success. The risk manager had helped compile the compliance files, was familiar with the records, and would have recognized any misfiled records.
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 Respondent not guilty of violating Subsection 458.331(1)(m), guilty of violating Subsection 458.331(1)(f), and imposing no penalty. DONE AND ENTERED this 3rd day of December, 2002, in Tallahassee, Leon County, Florida. DANIEL MANRY 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 3rd day of December, 2002. COPIES FURNISHED: Larry McPherson, Executive Director Board of Medicine Department of Health 4052 Bald Cypress Way Tallahassee, Florida 32399-1701 William W. Large, General Counsel Department of Health 4052 Bald Cypress Way, Bin A-02 Tallahassee, Florida 32399-1701 R. S. Power, Agency Clerk Department of Health 4052 Bald Cypress Way, Bin A-02 Tallahassee, Florida 32399-1701 John E. Terrel, Esquire Department of Health 4052 Bald Cypress Way, Bin C-65 Tallahassee, Florida 32399-3265 H. Roger Lutz, Esquire Lutz, Webb & BoBo One Sarasota Tower Two North Tamiami Trail, Fifth Floor Sarasota, Florida 34236
Findings Of Fact Petitioner, Peter P. McKeown, is a graduate of the University of Queensland Medical School in Brisbane, Australia. He holds the degrees of Bachelor of Medicine and Bachelor of Surgery. Doctorates of Medicine, under the British system, are reserved for specialists. Nonetheless, the medical training Petitioner received equates to that leading up to the award of the degree of Doctor of Medicine in the United States, and he is a physician and licensed as such in several states. He has completed residencies in general and thoracic surgery in Australia and the United States and has taken advanced training in cardiovascular and thoracic surgery at Emory University. Immediately before coming to the University of South Florida, (USF), Dr. McKeown was an Assistant Professor of Surgery at the University of Washington. In mid to late 1988, Dr. McKeown responded to an advertisement USF had placed in the Journal of the American Medical Association seeking applicants qualified for appointment at the Associate Professor level "... to join the Department of Surgery at the University of South Florida College of Medicine as the Chief of Cardiothoracic Surgery." He was selected for the position and joined the faculty effective May 1, 1989. All the correspondence leading up to Petitioner's joining the University faculty referred not only to his appointment as Associate Professor but also his assignment as Chief of the Cardiothoracic Surgery Division. Only the actual state employment contract described his employment exclusively as Associate Professor and made no mention of the Chief position. Under these circumstances, Petitioner did not gain any proprietory interest in the position of Chief of the Cardiothoracic Surgery Division. Dr. McKeown held the position of Chief of the Cardiothoracic Surgery Division until April, 1994, when, as a result of a decision made by the Chairman of the school's Department of Surgery, he was replaced as Chief and that position was filled, on a temporary basis, by the Department Chair. Petitioner claims that when he arrived at USF to assume the directorship, an administrative position, he saw an opportunity to develop the position into something significant. He contends he would not have come to USF unless he was to be the Chief of the Division as there was no appeal to him in a position as a general faculty member. He wanted an opportunity to budget, hire people, and develop plans and programs, and in order to advance in academic medicine, one must, at some point, hold an administrative position. Apparently the Department of Surgery had experienced a rapid turnover in faculty. It is not clear whether this caused or was the result of a dispute with administrators and medical staff at Tampa General Hospital, (TGH), where much of the clinical medical school activity is carried on. However, the program was recognized as being weak in cardiothoracic surgery, and this condition offered Petitioner the challenge he wanted. In his five years as Chief, Petitioner increased both the number and quality of personnel and revenues considerably. He developed affiliations with several foreign universities and recruited qualified people, built up the laboratory, secured more grants, developed a program of continuing medical education and raised the examination scores of the school's graduates. He opened new clinical programs and built up both billings and collections to the point where the program revenues were increased at least 2 to 5 times. By 1992- 1993, the Division was making money and generating a surplus and still used clinic funds to support research. During his tenure as Chief of the Division, Petitioner served under two Department of Surgery chairmen. The first was Dr. Connar, the individual who recruited him; and the incumbent is Dr. Carey, the individual who removed him. Petitioner asserts that at no time during his tenure in the position of Chief of the Cardiothoracic Surgery Division was he ever told, by either Department Chairman, that his performance was unsatisfactory. All Division heads within the Department were, from time to time, counseled about personnel costs, and Petitioner admits he had some differences with Dr. Carey about that subject and some other financial aspects of the job, but nothing different than anywhere else in academia. Petitioner was removed by Dr. Carey based in part upon his alleged inability to get along with people. Though he claims this is not true, he admits to three areas of conflict. The first related to his objection to transplants being accomplished by unqualified surgeons which, he alleges, Dr. Carey permitted to further his own ends. The second related to the pediatric heart transplant program for which Petitioner supported one candidate as chair and Dr. Carey supported another. The third related to Petitioner's reluctance to hire a physician whom Dr. Carey wanted to hire but to whom Petitioner purportedly objected. Of the three areas of dispute, only the first two came before his removal, but he contends at no time was he advised his position was a problem for the Department. By the same token, none of Petitioner's annual performance ratings reflected any University dissatisfaction with his performance. At no time was he ever rated unsatisfactory in any performance area; and prior to his removal, he had no indication his position as Chief of the Division was in jeopardy. Dr. Carey indicates he did counsel with Petitioner often regarding his attitude but did not rate him down because he hoped the situation would improve. Dr. McKeown was called to meet with Dr. Carey in his office on April 12, 1994. At that meeting, Dr. Carey was very agitated. He brought up the "Norman" incident and indicated he was going to remove Petitioner as Chief of the Division. Dr. McKeown admits to having made an inappropriate comment regarding Dr. Norman, another physician, to a resident in the operating room while performing an operation. He also admits that it was wrong to do this and apologized to Dr. Norman both orally and in writing shortly thereafter. Dr. Norman accepted his apology and Petitioner asserts that after his removal, Dr. Norman called him and assured him he, Norman, had not prompted the removal action. Dr. Norman did not testify at the hearing. Dr. Carey removed Petitioner from his position as Chief because of the comments he had made regarding Dr. Norman. Almost immediately after the meeting was concluded, Dr. Carey announced in writing his assumption of the Chief's position, in which position he remained until he hired Dr. Robinson as Chief in April, 1995. Petitioner found out that Carey's threat to remove him had been carried out the following day when his nurse told him his removal had been announced at the Moffett Cancer Center. He thereafter heard other reports of his removal from other sources, and based on what had happened, concluded his removal was intended to be and constituted a disciplinary action for his comment regarding Dr. Norman. He was not advised in advance of Carey's intention to impose discipline nor given an opportunity to defend himself before the action was taken. He claims he was not given any reason for his removal before or at the time of his dismissal. It is found, however, that the removal was not disciplinary action but an administrative change in Division leadership. Dr. McKeown at first did nothing about his removal, believing it would blow over. However, after he heard his removal had been publicized, he called several University officials, including a Vice-President, the General Counsel and the Provost, to see how the matter could be handled. He claims he either got no response to his inquiries or was told it was a Medical College problem. He then met with the Dean of the College of Medicine who indicated he could do nothing. After he was removed as Division Chief, Petitioner's salary remained the same as did his supplement from his practice. He claims, however, his removal has had an adverse effect on his reputation in the medical and academic communities. It is his belief that people now feel something is wrong with him. Dr. Carey's blunt announcement of his assumption of the Chief's position, without any reasons being given for that move or credit being given to Petitioner for his past accomplishments has had an impact on his ability to work effectively. After his removal, he received calls from all over the world from people wanting to know what had happened. The removal has, he claims, also made it more difficult for him to get grants and has, thereby, adversely impacted his ability to do productive research. In addition, his removal made it difficult for him to carry out his academic duties. His specialty is still presented in student rotations, only in a different place in the medical curriculum. Dr. McKeown has sought reinstatement to the administrative position of Chief of the Division. He is of the opinion that Dr. Carey's action in removing him from his position as Division Chief was capricious and damaging to the University as well as to his career. Petitioner admits he could have been less confrontational in the performance of his duties as Division Chief, but he knows of no complaints about him from TGH, All Children's Hospital or the VA Hospital. There are, however, letters in the files of the Department Chairman which indicate some dissatisfaction with Petitioner's relationships in some quarters and, as seen below, there were signs of dissatisfaction from both TGH and All Children's Hospitals. Petitioner admits he may have been somewhat overbearing or abrasive, but neither his alleged inability to properly steward finances nor his alleged inability to get along with people were mentioned to him at the time of dismissal or before. After Dr. Carey assumed the Chairmanship of the Department of Surgery in July, 1990, he saw Dr. McKeown frequently on an official basis at first. A Chief, as Petitioner was, has many and varied functions such as administration, teaching, fiscal, research, clinic administration and the like. People skills are important because of the necessary interface with colleagues, faculty, administrators and the public. When Dr. Carey came to USF, Dr. McKeown had not been in place very long, and the Division of Cardiothoracic Surgery was not doing well financially. There were contract negotiations going on with the VA Hospital which were not going well, at least partly because, Dr. Carey asserts, Dr. McKeown had made some major unacceptable demands. As a result, Dr. Carey stepped in, along with Dr. Benke, who was very effective in dealing with the VA, and as a result, an agreement was reached which resulted in somewhere between $275,000 and $300,000 per year coming in which put the Division in the black. Dr. Carey recalls other instances indicating Dr. McKeown's inability to get along with others. One related to the relationship with TGH previously mentioned. TGH had made a decision to use a particular physician as head of its transplant program because, allegedly, Dr. McKeown had so angered private heart patients they would not let him be appointed even though Dr. McKeown was Dr. Carey's choice. As it turned out, Dr. Carey convinced the TGH Director and another physician to agree to a plan whereby Dr. McKeown would be head of the program 50 percent of the time. This would have been good for the University, but Dr. McKeown refused indicating that if he could not be in charge all of the time, he would not be in charge at all. Another incident relates to All Children's Hospital. That institution wanted to initiate a pediatric heart transplant program and a meeting was set up to which Dr. McKeown was invited. Petitioner so infuriated the community surgeons attending that meeting they would not work with him, and without his, Carey's, efforts, Dr. Carey claims the program was doomed to failure. As a result, Carey asked Dr. Nevitsky to help get the program started. This gave the USF an opportunity to participate in the program, but when Nevitsky left, they lost it. Still another example, according to Dr. Carey, is the fact that some surgeons on staff have called to complain about Dr. McKeown's attitude and unwillingness to compromise and negotiate and about his demands for service and staff, all of which creates friction among the hospital staff. A few days before Dr. Carey removed Petitioner as Chief, he spoke with the Dean of the College of Medicine, a Vice-president of the University, and others who would be impacted, about his concern regarding the Cardiothoracic Surgery Division and, in fact, he had had discussions with other officials even before that time. Long before making his decision to remove Petitioner, Carey spoke of his consideration of possibly shifting the emphasis within the Division to non-cardiac thoracic surgery in place of the cardiac program which Dr. Carey felt was not very successful. He believed the program did not do enough procedures to support the medical school affiliation. Dr. Carey chose to dismiss Dr. McKeown as Chief of the Division on April 12, 1994, after learning of McKeown's destructive attack on another surgeon before a junior physician in a public place, an operating room, (the Norman incident). He notes that over the years there was a building concern regarding Dr. McKeown's abilities as an administrator, and this incident with Dr. Norman was the last straw. Dr. Carey had received complaints about Petitioner from other physicians, all of which he discussed with Dr. McKeown. Finally, with the Norman incident, it became abundantly clear that Dr. McKeown's capabilities as a leader had diminished to the point where a change was necessary. Before he dismissed Petitioner, and during the investigation which led up to the dismissal, Dr. Carey admits, he did not give Dr. McKeown any opportunity to give any input to the decision. By the time Carey met with McKeown on April 12, 1994, his mind was made up. The Norman incident was demonstrative of what Carey perceived as McKeown's lack of supervisory ability, and it was that factor which led Carey to the ultimate decision to remove McKeown. He felt it necessary to act then and not leave Dr. McKeown in place during the search for a replacement. Petitioner cites alleged comments made by Carey to others that he would have relieved anyone for doing what Petitioner did in the Norman incident. Dr. Carey cannot recall having made such a statement. He claims he considered disciplinary action against Petitioner for the Norman comments but decided against it. However, it was the last in a series of incidents which caused him to question the propriety of McKeown's placement in the Chief's position, and which ultimately cemented his decision to replace him. Dr. Carey met with Dr. McKeown several times before the dismissal and counseled him about administrative deficiencies in his performance, but he never told Dr. McKeown that unless he improved, he would be dismissed. This is consistent with Petitioner's testimony that he was not warned of his shortcomings or of the administration's dissatisfaction with his performance. Disagreements in conversations between superior and subordinate, meant by the former to be corrective in nature, are not always taken as such by the latter. Dr. Carey did not document any of this in Dr. McKeown's personnel files but put some of the information he received by way of communications from others in the files. These are the letters submitted by the University, pursuant to agreement of the parties, subsequent to the hearing. They contributed to Carey's increasing concern about Dr. McKeown's ability to lead the Division. At no time, however, though he questioned Dr. McKeown's leadership, did Dr. Carey ever question his good faith and sincerity, nor does he do so now. When he finally decided action was necessary, on April 12, 1994, Dr. Carey wrote a memorandum to the Medical College faculty concerning his assumption of the position as Chief of the Cardiothoracic Surgery Division. He also advised Dr. McKeown of his removal. Dr. Carey remained in the Chief's position, holding that title in an administrative capacity and not from a clinical standpoint, for approximately one year, intending to stay in the position only until he could find a fully qualified thoracic surgeon to take the job. After Carey removed Petitioner, he was contacted by the Medical College Dean who asked that he get with McKeown and try to work something out. He thereafter offered Dr. McKeown the position of Chief of the cardiac section of the Division but McKeown declined. Dr. Carey also, on April 26, 1994, wrote to TGH recommending that Dr. McKeown be allowed to have more impact on the hospital's transplant program, pointing out that the change in McKeown's position at the University was occasioned by a need for a change in leadership. According to Dr. Tennyson J. Wright, Associate Provost of the University, disciplinary action against nonunion faculty members is governed by Rule 6C4-10.009, F.A.C., and requires notice of proposed action be given before such disciplinary action is taken. The contract which Dr. McKeown holds and has held since the inception of his tenure at the University, is a standard USF/State University System contract. It reflects Petitioner was hired as an Associate Professor, which is one of the three types of personnel classifications used within the system. These are faculty, administration and support. Petitioner's contract does not refer to his holding the Division Chief position and it is not supposed to. Such a position is an administrative appointment within a Department and a working title used to define the holder's duties, and service in such a position is at the pleasure of the Department Chair. Appointment to or removal from a Chief position is an administrative assignment. The position of Department Chairperson, on the other hand is a separate position and subclassification within the University classification system and is different.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that Petitioner, Peter P. McKeown's, grievance against the University of South Florida School of Medicine arising from his removal as Chief, Cardiothoracic Surgery Division in the Department of Surgery be denied. DONE AND ENTERED this 19th day of January, 1996, in Tallahassee, Florida. ARNOLD H. POLLOCK, 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 19th day of January, 1996. APPENDIX TO RECOMMENDED ORDER IN CASE NO. 95-1832 The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the Proposed Findings of Fact submitted by the parties to this case. FOR THE PETITIONER: 1. - 7. Accepted and incorporated herein. Though the documents in question refer to appointment, in actuality the personnel action was an appointment to the faculty with an administrative assignment to the position of Director of the Division. & 10. Accepted. 11. & 12. Accepted and incorporated herein. 13. & 14. Accepted and incorporated herein. - 19. Accepted and incorporate herein. Accepted and incorporated herein. Accepted. Rejected as inconsistent with the better evidence of record. Accepted. Accepted and incorporated herein. Rejected as inconsistent with the better evidence of record. & 27. Accepted. & 29. Accepted and incorporated herein. Accepted. Accepted and incorporated herein. 32. - 34. First sentence accepted. Second sentence rejected as inconsistent with the better evidence of record. 35. - 37. Accepted. 38. Rejected as argument. 39. Accepted. FOR THE RESPONDENT: - 9. Accepted and incorporated herein. Accepted. - 14. Accepted and incorporated herein. 15. & 16. Accepted and incorporated herein. COPIES FURNISHED: Benjamin H. Hill, III, Esquire William C. Guerrant, Jr., Esquire Danelle Dykes, Esquire Hill, Ward & Henderson, P.A. Post Office Box 2231 Tampa, Florida 33601 Thomas M. Gonzalez, Esquire Thompson, Sizemore & Gonzalez 109 North Brush Street, Suite 200 Post Office Box 639 Tampa, Florida 33601 Olga J. Joanow, Esquire University of South Florida 4202 East Fowler Avenue, ADM 250 Tampa, Florida 33620 Noreen Segrest, Esquire General Counsel University of South Florida 4202 East Fowler Avenue, ADM 250 Tampa, Florida 33620-6250
Findings Of Fact Petitioners Flagler and St. Augustine have each applied for a CON to establish an inpatient cardiac catheter-ization program within HRS Service District IV. Each had the opportunity of responding to HRS' "omissions letter" for the cure of certain initial flaws. However, in its preliminary review of the applications, HRS denied both applicants and this proceeding followed. HRS initially denied Flagler's application, stating it had only partially complied with Sections 381.705(1)(a), (b), (i), (l), (n), and (2)(b) and (d) F.S. (1989) and Rule 10-5.011(1)(e)4.a, 4.c., and 8.b. F.A.C. HRS initially denied St. Augustine's application, stating it had only partially complied with Sections 381.705(1)(a), (b), (h), (i), (l), (n), and 2(b) and (d) F.S. and Rule 10-5.011(1)(e)4.a., 4.c., and 8.b. F.A.C. and that the applicant failed to demonstrate any compliance with Sections 381.705(1)(m) and (2)(a) F.S. Prior to formal hearing, the parties stipulated that there is a numerical need under Rule 10-5.011(1)(e)8. F.A.C. for one additional inpatient cardiac catheterization laboratory in HRS District IV for the applicable planning horizon for these applications. That planning horizon is January 1992. The parties further stipulated that both applicants have provided quality care; that, except for existing inpatient catheterization laboratories, there are no alternatives to the proposed facilities; that health manpower and management personnel are available for operation of the proposed programs; that the salaries listed on each application are reasonable; that the costs and methods of construction proposed are reasonable; that either applicant, if approved, would meet the scope of services, hours of operation, and health personnel requirements of Rule 10-5.011(1)(e) F.A.C.; and that St. Luke's Hospital in Jacksonville provides open heart surgery and is within one-half hour ambulance travel time from either applicant. It was also stipulated at formal hearing that the equipment costs proposed by both applicants are reasonable and that the costs of construction, as proposed in the applications, are reasonable. Facilities operated by Flagler Hospital, Inc. and St. Augustine General Hospital, L.P. are located in the city of St. Augustine, St. Johns County, Florida. The two facilities are less than 500 yards apart and, for all practical purposes, are directly across U.S. 1 from one another. Both facilities are 115-bed general acute care hospitals providing the same services except that Flagler provides obstetrics and St. Augustine does not. The service areas of the two hospitals consist of the five zip codes immediately surrounding the two facilities as the primary service area and St. Johns County, except the Ponte Vedra area, as the secondary service area. Flagler operates as a not-for- profit hospital. St. Augustine operates for profit. The applicant for CON 6011 is "Flagler Hospital, Inc." This corporation is based out of its only and local facility described supra and is locally operated. Regardless of any other terminology applied during HRS' review leading up to the formal Petition in DOAH Case No. 90-2035, and regardless of any inadvertent changes of the style of that cause thereafter, the "applicant" for CON 6012 is, in fact, "St. Augustine General Hospital, L.P.," a limited partnership. The applicant's August 23, 1989 Letter of Intent in CON 6012 is in the name of "St. Augustine General Hospital, L.P. d/b/a St. Augustine General Hospital." The Identification of Principal Parties form submitted by the applicant states that the legal name of the applicant/parent corporation is "St. Augustine General Hospital, L.P." and that the facility/project name is "St. Augustine General Hospital." As of the date of formal hearing, "St. Augustine Hospital, Inc." (no "General" in this name) was a wholly-owned subsidiary of "Healthtrust, Inc." and the only general partner in the applicant, and "Healthtrust, Inc." was the sole limited partner in the applicant. "Healthtrust, Inc." purchased the shares of all the other former limited partners in July 1990, only after this cause had reached the formal hearing stage. The Board of Directors of the general partner, "St. Augustine Hospital, Inc.," is located in Nashville, Tennessee, as is the Board of Directors of "Healthtrust, Inc." Health Corporation of America (HCA) owns a significant number of shares (approximately 30-34%) of "Healthtrust, Inc." "Healthtrust, Inc." is a nationwide hospital chain with approximately 90 hospitals, which "spun off" from HCA in 1987. Thus, "Healthtrust, Inc." is both the sole owner of the general partner and the sole limited partner in the applicant, a limited partnership. The past lineage of the several St. Augustine legal entities is somewhat convoluted, but it is a significant and material consideration for purposes of this CON proceeding that "Healthtrust, Inc." collects management fees from St. Augustine General Hospital, which is the applicant's d/b/a namesake, and that "Healthtrust, Inc." seems to have been underwriting St. Augustine General Hospital in one context or another for an uncertain period of time. St. Augustine General Hospital has been losing money annually. Its net loss for fiscal year 1990 was $2 million. By a September 25, 1989 letter from Stephen C. Brandt, "Healthtrust, Inc.," otherwise known as "The Hospital Company," has committed to loan "St. Augustine General Hospital, Inc." sufficient funding to implement and provide cardiac catheterization services at "St. Augustine General Hospital." The proposed recipient of "Healthtrust Inc.'s" commitment, which is "St. Augustine General Hospital, Inc.," is not the same entity or legal "person" as the applicant, "St. Augustine General Hospital, L.P.," and the parties further agree that there is no such legal entity as "St. Augustine General Hospital, Inc." (TR-132-133) Also, it is not clear from this record what other enterprises or ventures are attributable to "St. Augustine Hospital, Inc.," the general partner in the applicant. Therefore, even if the true intent of Mr. Brandt's letter was to show that the general partner, "St. Augustine Hospital, Inc." and not the nonexistent "St. Augustine General Hospital, Inc.," would receive funding from "Healthtrust, Inc.," there is no guarantee that "Healthtrust Inc.'s" funding commitment to the general partner would be used as a simple conduit to St. Augustine General Hospital, L.P., the applicant. With regard to quality of care, either applicant is capable of providing high quality cardiac catheterization services. However, St. Augustine's proposed physical plant is less ideal than that proposed by Flagler. St. Augustine proposes a lab with a procedure room that contains only 314.5 square feet of floor space. The industry standard is 480 square feet. The State of Florida has not adopted by rule a standard for the minimum size of a cardiac catheterization procedure room. However, the Inter-Society Commission for Heart Disease Resources has issued a report, relied upon by architects in designing cardiac care facilities, which recommends a minimum size for a procedure room of 50.4 square yards, which equals 453.6 square feet. The State Health Plan has adopted the Inter-Society Commission Report. Undersizing the lab has the potential to downgrade the quality of care in St. Augustine's proposed lab in several respects. It limits the storage space necessary and required to conduct routine procedures and crash procedures in cardiac arrest situations and interferes with maintaining the "sterile field," essential to routine catheterization procedures, but more importantly, in the event of a cardiac arrest or other emergency situation, there may not be adequate room for as many as five additional persons to enter the room, together with emergency equipment, to resuscitate and stabilize the patient. Concerns about undersizing of space are not applicable to Flagler's proposed catheterization lab. St. Augustine submitted that it could convert space adjacent to its proposed lab for its cardiac catheterization program at a cost of approximately $33,000, but expert testimony was persuasive that such a conversion could be considerably more expensive. To the extent that St. Augustine's planning would need to be revised, additional drawings would have to be prepared to show the reconfiguration of the room with the cost increase. Even assuming, arguendo, that St. Augustine's $33,000 figure is correct and that $33,000 is a proportionately low cost of such a change of plans in relation to St. Augustine's entire proposed project costs, it is found that such a construction conversion as proposed would constitute a change in the St. Augustine application so substantial that it would require amendment of St. Augustine's pending application and therefore such a conversion cannot be considered anew and without prior HRS review at this stage of the CON proceedings. The State Health Plan contains certain preferences relevant to this comparative CON review. Both applications benefit from the State Plan's favoring of an applicant proposing to provide cardiac catheterization services in a county that does not presently have a catheterization lab if it can be demonstrated that patients are leaving the county for such services. Upon the credible evidence as a whole, including but not limited to the testimony of Messrs. Jernigan and Nelson, Ms. Dudek, and Drs. Matthews, Prakash, and Mehrotra, it is found that a minimum of 225 patients had to travel outside St. Johns County, primarily to Jacksonville, Duval County, for such services in 1988, and there is competent, substantial evidence upon which a reasonable person may infer that that number is increasing (See Finding of Fact 20). HRS' viewpoint that freestanding labs which do not require a CON in order to operate in the proposed service area now accommodate these patients or will soon take up this slack is not supported by credible, competent substantial evidence. (See Finding of Fact 19) The State Health Plan also favors disproportionate Medicaid providers. Flagler is a federally designated disproportionate share hospital and qualifies for this preference. (See, also, Findings of Fact 15 and 20). Both applicants have committed to provide services to all patients regardless of their ability to pay and therefore both applicants meet this State Health Plan preference. The Local Health Plan also contains criteria relevant to these applications, among which is that plan's preference for an applicant who proposes to provide catheterization services in an area of concentrated population which is currently without an existing program. The city of St. Augustine constitutes such a designated area, and since both applicants' facilities are located there, they are each entitled to such preference. Both facilities are located in the District IV subdistrict with the highest use rate, and both are entitled to the Local Health Plan's preference for an applicant in the area of highest catheterization use. St. Augustine would be the logical place to put a catheterization lab if need were shown, and HRS' own rule reveals the need for one lab. (See also Finding of Facts 4, 14, 20) The Local Health Plan also prefers the applicant who will provide the proposed services in the most cost effective manner. Hospital Cost Containment Board (HCCB) figures suggest that Flagler is superior in this regard but are not persuasive in and of themselves. Historically, the applicants have been comparably cost-effective, dependent upon the procedure or service assessed. However, for the reasons set forth infra in respect to long-term financial feasibility in general, Flagler has the edge in this preference area. The Local Health Plan contains a preference for an applicant addressing a current access problem. HRS determines need for inpatient cardiac catheterization labs on a district-wide basis rather than a county-by-county basis. No cardiac catheterization subdistricts have been designed and promulgated by HRS rule. The Local Health Plan uses a subdistrict basis; subdistrict 3 contains St. Johns County without any inpatient cardiac catheterization programs and southeastern Duval County where three hospitals provide such services. Either applicant's facility meets the access standard of Rule 10-5.011(e)4.a. F.A.C., that is, access within one hour of automobile travel time under ordinary conditions for 90% of the district population. However, the access problem bears some further specific commentary. St. Johns County residents now regularly travel, primarily to Jacksonville, Duval County, and to a lesser extent, to Gainesville, Alachua County, to receive these services. Increased costs and duplicate procedures often accrue unnecessarily to patients who seek treatment outside the service area/county. Moreover, the need to travel probably depresses the number of catheterization procedures done on St. Johns County residents, either because of the genuine logistics of lack of continuity of care, travel costs to the patient and family, and stress on the patient and family caused by out-of-county procedures or because of the patients' perceptions that these problems exist. Health care of patients who forego catheterization for these reasons would be qualitatively improved if they could submit to the procedure in their own locale; likewise, health care and costs to all catheterization patients would be improved it they could access the procedure close by with lesser travel, stress, and peripheral costs. That an access problem exists has been thoroughly and conscientiously demonstrated by both applicants. It has also been established that the city of St. Augustine location of either applicant would enhance accessibility for the elderly, handicapped, and medically indigent who are the least likely patients to submit to travel for inpatient catheterization services. For those reasons and since the two facilities to be utilized by the applicants are in such close proximity, it can only be concluded that the award of a CON to either applicant would equally improve access to inpatient cardiac catheterization services on a geographic basis alone. Both applicants will be able to meet the personnel requirements of Rule 10-5.011(e)5.b. F.A.C. The premise that a de minimis higher FTE projection by St. Augustine automatically translates into better patient care was not proven and is suspect due to the size limitations of St. Augustine's proposed lab. (See Finding of Fact 10) Flagler's argument that because Flagler assigned a higher pay rate to different members of its catheterization team and because Flagler is willing to pay higher salaries overall does not translate into an advantage upon the state of this record as a whole. Either applicant will provide services to all persons in need, regardless of ability to pay, and each applicant further proposes serving Medicare, Medicaid, indigent, private pay, and HMO/PPO. Both applicants must, by law, comply with any conditions HRS may place on their CONs. In these respects, it is concluded that each applicant equally meets those respective Local Health Plan preferences, even though Flagler has clearly shown that its past "track record" in the area of Medicare, Medicaid, and indigent care exceeds that of St. Augustine in both quantity and quality. (See Findings of Fact 11 and 20) All capital projects or expenditures proposed by St. Augustine have to be approved by Healthtrust, Inc., although the hospital management can approve "substitutions" of capital items of less than $5,000 per invoice. This restriction on local management, St. Augustine's potentially imprudent freezing of its per procedure cost for two years, and its perennially low occupancy rate overall (42 out of 115 beds last year) impact unfavorably on both the short-term and long-term feasibility of its project. St. Augustine raised the valid point that since, due to litigation, neither applicant can meet its projected opening date, some adjustment of each applicant's pro forma, based on inflation, is in order, however what this adjustment should be was never persuasively quantified by the witnesses. St. Augustine challenged Flagler's pro forma statement on basically three grounds: that the nine-month earlier projected starting date (now past) for Flagler's lab projects an artificially lower patient charge due to inflation; that Flagler's supply expense of $200 is too low; and that Flagler did not amortize remodeling costs of $147,000. Both applicants' projections in the category of patient charge per procedure are found to be reasonable, but St. Augustine also suggested that Flagler's patient charge per procedure should be increased by 3.75%, which assumes a nine-month adjustment, at a 5% annual interest rate to increase Flagler's procedure charge from $1,385 to $1,437 for year one and from $1,475 to $1,530 for year two. Such a result would not render Flagler's proposal unreasonable and would have the effect of increasing Flagler's profitability. However, no evidence showed Flagler intended to increase its charge. Flagler's projected supply expense per procedure is reasonable. Assuming Flagler depreciates renovation costs over a 20 year period, the resulting minimal increase in depreciation is not a significant concern proportionate to Flagler's "bottom line" profitability. HRS opposes both applications in part upon its assertion that neither applicant can attain its proposed number of procedures so as to insure long term financial feasibility. One of HRS' premises for this assertion is its contention that there are few cardiologists residing or practicing in St. Johns County. This is a truism so far as it goes, but not a controlling factor in light of significant other forces at work. Rather than cardiologists' clientele "feeding" a cardiac catheterization lab, as HRS originally supposed, the undersigned finds, upon the greater weight and credibility of all witnesses, including HRS' Ms. Dudek, that the absence of an inpatient cardiac catheterization lab in the city of St. Augustine, St. Johns County, has, in fact, depressed the availability of cardiologists in the county. Upon the testimony of Mr. Conzemius and Dr. Lambert, it is found that because there is no inpatient cardiac catheterization lab available, cardiologists currently cannot be recruited by either applicant. Establishment of such a lab by either applicant would result in more cardiologists locating in St. Augustine and St. Johns County with a concomitant improvement in patient accessibility to cardiology services. HRS' assertion that neither applicant can attain its break-even use rate is not based upon any definitive or even cursory study by HRS of existing county use rates, CONs are not required for outpatient catheterization services which may be offered in freestanding facilities. The record does not establish with specificity the extent of utilization or service volume of outpatient cardiac catheterization labs, if any, in St. Johns County. There is expert cardiologist testimony that freestanding catheterization labs are not a medically acceptable alternative to inpatient programs in a hospital. HRS contended that neither applicant has projected reasonable patient utilization figures guaranteeing long-term financial feasibility of their respective projects, but conceded that either proposal would be financially feasible if it attracted the projected patient numbers. The greater weight of the credible evidence supports a finding that sufficient numbers of inpatient cardiac catheterization patients can be captured by either applicant. Typically, 20% of cardiac catheterizations are done on an outpatient basis, so the 225-patient figure demonstrated for 1988 understates the potential cardiac catheterization patients in St. Johns County by 20%. Thus, approximately 55 more patients obtained catheterization out of county in 1988 than are shown by the inpatient figures, so mathematically one could project 270 such procedures on St. Johns County residents actually occurred in 1988. Application of the statewide use rate of 8.9 such procedures per 1,000 people applied to the appropriate January 1, 1992 planning horizon with the predicted population increase would yield an even higher potential patient figure of 674. Subdistrict 3 has historically experienced a yet higher use rate of 10.1 cardiac catheterization admissions. Either Flagler's 250 (first year) and 300 (second year) or St. Augustine's 275 (first year) and 325 (second year) is a reasonable projection which meets the HRS recommended minimum volume of 300 procedures per year in the second year. See, Rule 10-5.011(e)8.a. and e. F.A.C. Having a cardiac catheterization program would complement the obstetrical care which is exclusive to Flagler. Both applicants indicated their willingness to make their services available to a broad payor mix. St. Augustine projects utilization by class of pay for both year one and year two of operation as 2.2% Medicaid, 56.9% Medicare, 38.9% insurance, and 2.2% indigent. Flagler projects utilization by class of pay for both years as 7% Medicaid, 60% Medicare, 31% insurance, and 2% indigent. St. Augustine's projection of 2.2% of its cardiac catheterization services for Medicaid patients is reasonable but its projection of that same percentage for charity is inconsistent with St. Augustine's prior service and is unreasonable. Considering Flagler's historical Medicaid and indigent service history, its several contracts to provide care to these classes of pay, and the comparable cardiac catheterization utilization experience of similar providers, Flagler's projections in this respect are reasonable. If Flagler has erred in this portion of its assessment, increased percentages of patients covered by insurance reimbursements would only improve Flagler's "bottom line" for long- term financial feasibility. Both applicants' pro forma statements are based on operation of the proposed cardiac catheterization lab only, not including ancillary services and other charges related to the entire patient episode of care. Both applicants will receive an incremental layer of profit from establishing a cardiac catheterization lab, but that amount was not quantified on this record. The greater weight of the credible expert evidence shows that St. Augustine's understatement of a number of expenses will result in its lab experiencing a net loss which it will be tempted to "pass on" through other hospital charges. St. Augustine's commitment to following Healthtrust, Inc.'s policies with regard to depreciation, amortization, and assigning useful life to equipment is not persuasive that these corporate principles are preferable to the generally accepted accounting principles used by Flagler. If St. Augustine's commitment to freezing its charge per procedure does not result in its raising fees elsewhere, this commitment may still aggravate instead of alleviate St. Augustine's financial predicament, for the entire facility currently operates at a net loss. Rule 10-5.011(1)(e)6. F.A.C. as amended, August 1988, requires that CON cardiac catheterization applicants who do not provide open heart surgery services include a written protocol for the transfer of emergency patients to a hospital providing open heart surgery which is within 30 minutes' travel time by emergency vehicle under average travel conditions. No statute, rule, or credible testimony herein defined "protocol" contrary to the interpretation given that term in Florida Medical Center et al. v. HRS, 11 FALR 3904 (1989). HRS' Ms. Dudek determined that each submittal met HRS' intent in the current rule. Her rule interpretation, based on agency expertise, is entitled to great weight. Flagler filed a protocol which is specific to cardiac catheterization patients in need of open heart surgery but did not specify which open heart surgery facility would be utilized. St. Augustine submitted a current transfer agreement between St. Augustine General Hospital, L.P. and St. Luke's Hospital, Jacksonville, the closest open heart surgery provider. This agreement is not specific to cardiac catheterization patients. St. Augustine also has an agreement with doctors at St. Luke's for open heart services backup. St. Luke's is within one-half hour's emergency travel time from either applicant's facility. There was no valid reason advanced in this record to suppose that Flagler could not also obtain travel and backup services with St. Luke's if it were granted the CON applied-for. Therefore, it is found that both applicants have complied with the current rule. Inherent in all challenges to the applicants' respective financial projections is the completeness of each application, and evidence as to the completeness of both applications has been received. Upon the testimony of HRS' health planning expert and agency representative, Elizabeth Dudek, it is found that at the time both applications were filed and at all times material to these applications, there was no consensus at HRS as to what constituted a "capital project" pursuant to Section 381.707(2)(a) F.S.; HRS had no definitional rule in place; HRS regularly looked to an applicant's audited financial statements with respect to the impact statement required under that section; and HRS did not require that there be a separate page labelled "assessment" for compliance with that section. Ms. Dudek reviewed both applications in the context of Section 381.707(2)(a) for HRS against other information already internal to HRS (exemptions, determinations for exemptions, or non-reviewables) and determined for purposes of initial review that both applicants had "captured" what HRS needed to know under Section 381.707(2)(a). This remained her opinion at formal hearing. (TR-586-589, 591- 593) St. Augustine expressly stated in its omissions response that it "has no capital projects applied for, pending, approved or underway in any state" (emphasis in original). In fact, the HCCB reported that for the eight-month period ending August 31, 1989, St. Augustine had $59,000 in construction in progress. Moreover, St. Augustine failed to list a lobby and patient wings renovation project costing approximately $540,000. St. Augustine's application contained no mention of these projects and no assessment, discussion, or analysis of their impact. St. Augustine's own Comptroller, David Chapman, would have defined these as capital projects (TR-93-94), and a common understanding of the English language would suggest that his is a reasonable interpretation of the clear statutory language. Flagler provided a page titled "FLAGLER HOSPITAL, INC. CURRENT CAPITAL PROJECTS" (Flagler-10), which listed the following "capital projects," as their expert witnesses defined that term under the statute. Maintenance and Yard Service Facility $61,000 (Review exemption pending) Storage Room Improvements $75,000 (Review exemption pending) Flagler Hospital Replacement Facility CON #2883; $21,728,558 Cost overrun application is being developed Rick Knapp, a certified public accountant and Flagler's expert in health care finance, accounting, and financial feasibility, also testified that Flagler's inclusion of the replacement hospital in the application as a "capital project" when the replacement hospital was essentially paid out before Flagler's CON application was even filed was probably not necessary under the statute but was intended for full disclosure. In fact, the evidence at formal hearing shows that Flagler's $21 million-plus replacement facility was completed, occupied, and paid for prior to Flagler's submission of the CON application to HRS in September 1989. The audited financial statements submitted with Flagler's application also indicated that, as of September 30, 1988, there had been construction in progress of $17 million, and an estimated $7.5 million for expected completion of construction in fiscal year 1989. Evidence admitted at formal hearing showed that the construction had been completed and the facility occupied in February 1989. Flagler began to depreciate its replacement facility upon occupancy. An overrun of approximately four million dollars was accrued and paid as of February 1989, but determining its exact amount was delayed by litigation with the architect and retainage by the general contractor. It cannot be determined from the application and omissions response that the cost overrun had been financed in full, but the two smaller capital projects were considered in the preparation and submission of Flagler's omissions response and specifically, depreciation expenses are included in the omissions response for all three of the above-identified projects. The hospital-wide pro forma contained in Flagler's omissions response shows a "healthy bottom line" for Flagler, even after consideration of the then-pending capital projects. Mr. Knapp represented that pages R-1, 2 of Flagler's omissions response (Flagler-11) meet the requirements of Section 381.707(2)(a) F.S., requiring a complete listing of all capital projects and an assessment of the capital projects' impact on the applicant's ability to provide the proposed cardiac catheterization lab. However, a close reading of pages R-1, 2 reveals that pages R-1, 2 do not repeat the list of capital projects just described or "showcase" Flagler's capital projects' impact on Flagler's ability to provide the services of the proposed catheterization lab, but rather, they make the detailed evaluation of the impact of the proposed cardiac catheterization lab on the cost of other services provided by Flagler, which detailed evaluation is required by Section 381.707(2)(c) F.S. Indeed, R-1 is entitled "IMPACT OF PROPOSED PROJECT ON COSTS OF OTHER SERVICES PROVIDED BY THE APPLICANT." Flagler's own witnesses concede that pages R1, 2 must be read in conjunction with Flagler's audited financial statements in order to arrive at the analysis of how other "health facility development projects and health facility acquisitions applied for, pending, approved or underway" will affect Flagler's ability to finance its catheterization lab. However, when compared to the pro forma on Table 3.3 of the application, it is clear that there is no impact of the listed capital projects on the proposed program. According to Mr. Conzemius, Flagler applied to HRS in March 1989 (six months prior to the filing of Flagler's CON application) and was turned down for an exemption on its overrun, and in the future Flagler will be applying for a CON regarding it. Flagler has disguised none of its activities from HRS and resolved and paid out the cost overrun prior to formal hearing so that the overrun, if it ever could have impacted on Flagler's proposed project, cannot do so now. Flagler's proposed cardiac catheterization lab will be paid for by cash funds in hand; the application contained a typographical error indicating that the funds were assured, when in fact, they are in hand. There will be no debt incurred by Flagler for the construction of the project.
Recommendation Upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that HRS enter a final order granting CON 6011 to Flagler Hospital, Inc. and denying CON 6012 to St. Augustine General Hospital, L.P. RECOMMENDED this 29th day of January, 1991, at Tallahassee, Florida. ELLA JANE P. DAVIS, 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 29th day of January, 1991. APPENDIX TO RECOMMENDED ORDER, CASE NOS. 90-2034 and 90-2035 The following constitute specific rulings pursuant to Section 120.59(2) F.S. upon the parties' respective proposed findings of fact (PFOF): Petitioner Flagler's PFOF (1-77): Accepted: 7, 10, 15, 16, 22, 23, 30, 34, 58 Rejected as irrelevant, unnecessary and nondeterminative: 4, 5 Rejected as subordinate or unnecessary: 66, 67, 68, 69, 70 Accepted except where subordinate, unnecessary, or cumulative to the facts as found; not necessarily adopted: 1-3, 11, 12, 13, 14, 17, 18, 19, 20, 21, 24, 25, 26, 27, 31, 33, 38, 39, 40, 41, 42, 53, 54, 55, 56, 59, 61, 62, 65 Rejected as mere legal argument: 6 Subjects covered but proposals rejected in form proposed because they are mere legal argument or recital of unweighted, unreconciled testimony and/or exhibits: 71, 72, 73 Covered as modified to reflect actual stipulations and credible record evidence as a whole, eliminating subordinate matters and mere legal argument: 8, 9, 28, 29, 32, 35, 36, 37, 43-52, 57, 60, 63, 74-77 The weight and credibility of all the evidence has been weighed within the RO and applies to all rulings. Petitioner St. Augustine's PFOF 6-(69)-73: [NOTE: St. Augustine numbered its preliminary matters 1-5 and its PFOF begin with #6; it also proposed two #69's] Accepted, except where subordinate, unnecessary, or cumulative to the facts as found: 6-15, 17-24, 26, 27, 28, 33, 35, 37, 38, 40, 41, 47 Accepted as modified to more closely conform to the material facts of record or to eliminate subordinate or unnecessary proposed facts or facts which were not proven: 31, 34, 48, 49, 52, 53, 54, 55, 58, 66, 67, 68, 69#2, 72 Accepted, except where subordinate, unnecessary or mere legal argument: 39, 43 Rejected as subordinate, immaterial or mere legal argument: 16, 25, 29, 32, 36 Subjects covered but proposals rejected in the form proposed because they are mere legal argument or recital of unweighted, unreconciled testimony and/or exhibits: 30, 42, 44, 45, 46, 50, 51, 60, 70 Rejected as not proven for the reasons set out in the RO: 56 Accepted in part, the remainder is rejected in part as mere legal argument, recital of unweighted, unreconciled testimony and exhibits, and/or not proven: 57 PFOF 59: First paragraph cumulative. All paragraphs beginning with a dash on the same page under 59: Subordinate and unnecessary to the facts as found or mere recital of unweighted or unreconciled testimony and/or exhibits and legal argument. Dash 1 on next page: Rejected as contrary to the credible record evidence as a whole. Remaining dashes beginning on that page: subordinate and not determinative and/or mere recitation of unweighted or unreconciled testimony and exhibits. Credibility determination made. Accepted but cumulative that historically Flagler has served more Medicaid patients than St. Augustine and is a disproportionate Medicaid provider. The remainder is rejected as mere legal argument or recital of unweighted or unreconciled testimony and/or exhibits: 61 Rejected that the same payor mix may be expected. The evidence supports Flagler's projected 7% Medicaid rate. The remainder is mere legal argument, subordinate and cumulative to the facts as found, and/or contrary to the weight of the credible record as a whole: 62-65 Accepted as modified to eliminate mere legal argument and to more closely conform to the material facts of record: 69#1 In all its parts, is rejected as mere legal argument and not determinative of any material fact: 71 PFOF 73: The subject matter is covered within the RO. Recital of deposition testimony in a belated attempt to impeach a witness who has testified has been rejected as not a proposed finding of material fact. The remainder is mere recitation of unweighted or unreconciled testimony/exhibits. The weight and credibility of all the evidence has been weighed within the RO and applies to all rulings. Respondent's PFOF (1-13): Accepted, except as subordinate or unnecessary: 1, 2, 3, 4, 7, 11, 13 Rejected in part as mere legal argument or unweighted or unreconciled testimony or exhibits (not proven upon the credible record evidence as a whole); otherwise accepted: 5, 6, 8, 9, 10, 12 The weight and credibility of all the evidence has been weighed within the RO and applies to all rulings. COPIES FURNISHED: Kenneth F. Hoffman Patricia A. Renovitch Attorneys at Law Oertel, Hoffman, Fernandez & Cole, P.A. Post Office Box 6507 Tallahassee, Florida 32314-6507 Jay Adams, Esquire Attorney at Law 1519 Big Sky Way Tallahassee, Florida 32301 Richard Patterson Assistant General Counsel Department of Health and Rehabilitative Services 2727 Mahan Drive Fort Knox Executive Center Tallahassee, Florida 32308 Sam Power, Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700
The Issue The issues are whether Respondent deviated from the applicable standard of care in the practice of medicine by inserting the wrong intraocular lens during cataract surgery, in violation of Section 458.331(1)(t), Florida Statutes, or failed to maintain adequate medical records, in violation of Section 458.331(1)(m), Florida Statutes, and, if so, what penalty should be imposed.
Findings Of Fact At all material times, Respondent has been a licensed physician, holding license number ME 0030598. Respondent graduated from medical school in 1976 and completed a three-year residency in ophthalmology in 1980. Board-certified in ophthalmology since 1981, Respondent is the medical director of the Treasure Coast Center for Surgery in Stuart (Surgery Center). The Surgery Center is an ambulatory surgery center licensed under Chapter 395, Florida Statutes. Since 1980, Respondent has performed over 20,000 surgeries, including over 10,000 cataract surgeries. In that time, he has never previously misidentified a patient, operated on the wrong site, or inserted the wrong lens. This case involves a wrong lens that Respondent inserted into an 80-year-old patient on October 17, 2000. A local optometrist had referred the patient to Respondent for evaluation of cataracts in both eyes. Respondent performed successful cataract surgery on the patient's right eye on August 22, 2000. A cataract is a partial or complete opacification, or clouding, of a natural lens or its capsule. Typically associated with aging, the cataract is a major cause of a slow loss of vision, making it more difficult for the patient to read or drive, especially at night with the glare of lights. Twenty years ago, conventional cataract surgery comprised an intracapsular cataract extraction with the lens implant placed in the front of the eye. In the last 20 years, the predominant mode of cataract surgery comprises an extracapsular cataract surgery or phacoemulsification with the lens implant placed behind the iris of the eye. In the phacoemulsification process, the surgeon, using a smaller incision than that used in the older procedure, dissolves the cataract-involved natural lens using ultrasound and removes the cataract in smaller pieces than the single-piece removal characteristic of the intracapsular extraction process. The patient was scheduled for phacoemulsification of the cataract-involved lens in her left eye at the Surgery Center as the first patient of the day on October 17, 2000. Respondent handled her case as he handles all of the other cases. Prior to the surgery, Respondent reviews the patient's office chart and brings it, together with the office charts of the other patients scheduled for surgery that day, from his office to the Surgery Center. At the Surgery Center, Respondent delivers the office charts to circulating nurses, who remove each chart, read it to determine the lens to be implanted, find the lens specified in the chart for implantation, and insert the packaged lens into the chart. A nurse then stacks the office charts in a stand in the order of the patients' surgeries scheduled for the day. From the patient's perspective, she is greeted by a receptionist upon arrival. The receptionist pulls the already- prepared materials, including an identification bracelet or armband, and has the patient sign the necessary paperwork. At this point, an admission nurse takes the patient to the preoperative area where the patient lies down on a gurney. The nurse identifies the patient and confirms the eye to be operated on and the procedure to be performed. After verifying this information, the nurse places the identification bracelet on the patient's wrist. In cases such as this, in which an anaesthesiologist administers the anaesthesia, the anaesthesiologist meets with the patient to confirm the identity of the patient, the eye to be operated on, and the procedure to be performed. The Surgery Center's policy requires: "the attending physician and/or anesthesiologist, along with the responsible nurse, will review the patient's medical record, the armband and the Surgery Schedule to confirm the correct operative site. The operative site will also be confirmed by the patient or parent/guardian." The cited language, as well as the surrounding context, reveals a policy to ensure that the correct site--here, left eye--is the subject of the actual surgical procedure; nothing in the policy explicitly requires anyone to match the correct lens with the patient. After completion of the preoperative procedure, the circulating nurse takes the patient from pre-op. Among the nurse's other duties is to check the patient's bracelet against the office chart and to ask the patient if she is the person named on the office chart and bracelet. Accompanying the patient into the operating room are the office chart and Surgery Center chart. Once in the operating room, the circulating nurse places the office chart on a side table used by the scrub nurse and the Surgery Center chart with the anaesthesia equipment. Transferred into the operating room, the patient is scrubbed by a scrub nurse, who drapes the patient from just below her knees to above her head with a gown that opens only at the site of the eye to be operated on. The purpose of the gown is to maintain a sterile field, so no one can lift the gown in the operating room, such as to identify the patient by face or bracelet with the name on the chart, without exposing the patient to a risk of infection. When Respondent enters the operating room, he is already scrubbed and wearing gloves. A stand holds the patient's office chart with the packaged lens implant at the side table. Respondent checks the power of the lens, as disclosed on the package, against the power specified on the office chart. In this case, the two powers matched, as the office chart and the lens implant were for another patient. To maintain sterility, Respondent cannot touch a chart while he is in the operating room; if the necessity arises, a nurse may touch the chart. Before proceeding with surgery, Respondent reads the name of the patient on the office chart. Respondent does not verify that the names on the bracelet and either of the charts are the same. Nor does Respondent confirm with the circulating nurse that she has done so. To check the identity of the patient, Respondent says, "Good morning, Ms. . I'd like you to put your chin up for me." However, patients often have fallen asleep from the three preoperative sedatives that they have already received. Respondent conceded that the patient in this case may not have been alert when he addressed her by name. For whatever reason-- reduced consciousness, unconsciousness, nervousness, or inability of the patient to hear Respondent or Respondent (or others) to hear the patient--the patient in this case did not effectively communicate to Respondent that she was not the patient whose name he stated. Respondent proceeded with the surgery and implanted the wrong lens into the patient's left eye. Respondent had specified a lens with a 21.5 diopter refractive power and implanted a lens with a 20.5 diopter refractive power. The circulating nurse discovered the error when she went to get the next patient and found the office chart of the patient on whom Respondent had just completed surgery. The next day, when the patient visited Respondent at his office for a routine post-operative examination, Respondent informed her that he had placed the wrong lens in her eye and recommended that he recheck her vision in a few days and then decide whether to perform a corrective procedure. Three days after the initial surgery, Respondent found an increased degree of anisometropia, which is the difference in refraction between the two eyes. At this time, the patient complained to Respondent about imbalance. Respondent advised corrective surgery, and, on October 26, Respondent performed surgery to replace the implanted lens with another lens. Although the initial surgery was sutureless, the corrective surgery required sutures. The corrective surgery was generally successful, although two and one-half months later, the patient was complaining that her left eye was sore to the touch--a complaint that she had not made following the initial surgery to the left eye. Petitioner asserts that Respondent's medical records are deficient in two respects: inaccurately describing the treatment and failing to justify the corrective surgery. Respondent dictates his operative reports prior to surgery, even though they bear the date of the surgery--here, October 17, 2000. To accommodate contingencies, Respondent dictates three conditional notes, one of which itself contains two alternatives. As found in the patient's operative report, these conditional notes state: The corneoscleral wound was enlarged, if necessary. * * * If necessary, an interrupted suture was placed for pre-existing against-the-rule astigmatism or to help maintain the water- tightness of the wound. If a suture was placed, the wound was retested to be water- tight. Although Respondent's pre-dictated operative notes for the patient are detailed, they omit a salient element of her surgery--that Respondent inserted a lens of the wrong power. Respondent did not try to conceal this fact. To the contrary, as soon as the nurse informed him of her error, he directed her to attach the sticky label on the lens package, which records the power of the lens, to the patient's chart. He also directed her to prepare an incident report, which prompted Petitioner's investigation. The expert testimony in this case was conflicting. Respondent's expert witness was originally contacted by Petitioner and asked for an opinion on the standard-of-care and medical-records issues described above. The witness opined that Respondent met the applicable standard of care and the medical records justified the course of treatment. Respondent then retained this physician as his expert witness. Respondent's expert witness opined that an ophthalmologic surgeon necessarily must rely to a "large extent" on staff for a "certain amount of identification" before the patient is transferred into the operating room. Respondent's expert witness did not explain in detail the qualifications inherent in these statements. Finding an error by the Surgery Center in the insertion of the wrong lens, Respondent's expert witness admitted that Respondent had some control over the circulating nurse, but stated that the nurse administrator basically directs the nurses. Expressing no problem with the conditional notes, Respondent's expert witness testified that it is not unusual for a surgeon to predictate an operative report and then change it if something unusual happens. Petitioner retained another expert witness to replace the expert witness who became Respondent's witness. Petitioner's expert witness opined that Respondent failed to meet the applicable standard of care and the medical records did not justify the course of treatment. Petitioner's expert witness opined that it was never within the applicable standard of care to insert the wrong lens and admitted that he was unaware of the procedures of the Surgery Center and Respondent to avoid this occurrence. Petitioner's expert witness explained that the surgeon is the captain of the ship and ultimately bears the responsibility for the insertion of the wrong lens. Petitioner's expert witness also opined that all pre- dictated operative notes were not "the standard of care" and likewise criticized the conditional notes. Petitioner's expert witness admitted that nothing included in or omitted from the operative notes would adversely affect the future management of the patient's medical care. Respondent's proposed recommended order identifies various deficiencies in the testimony of Petitioner's expert witness, although Respondent's assertion that the expert relied on a not-yet-effective strict-liability statute is not accurate. Most of these deficiencies pertain to the earlier allegations that Respondent failed to meet the applicable standard of care in performing cataract surgery on an 80-year-old patient and in performing the corrective surgery. Citing the recent case of Gross v. Department of Health, 819 So. 2d 997 (Fla. 5th DCA 2002)(Orfinger, J., concurring), Petitioner's proposed recommended order invites the Administrative Law Judge to be guided by common sense in assessing the standard-of-care issue. This invitation may arise from a well-placed concern with the means by which Petitioner's expert reached his conclusion that Respondent deviated from the applicable standard of care. Petitioner's expert witness has opined that the insertion of the wrong lens violates the applicable standard of care, without regard to the safeguards or precautions that a physician may employ to avoid this mishap. In finding a deviation from the applicable standard of care, the Administrative Law Judge relies on inferences and logic not explicitly identified by Petitioner's expert witness. In addressing the standard-of-care issue, Respondent's expert witness adopted the proper approach, which features a close analysis of the facts to determine the reasonableness of the surgeon's acts and omissions. Under that approach, however, the record establishes that Respondent failed to take all reasonable precautions necessary to prevent this mistake. Although the likelihood of the insertion of the wrong lens seems low, based on Respondent's experience, the burden of additional, effective safeguards would be minor. Both parties focused on the location of the bracelet relative to the length of the protective gown. However, an anklet would be in plain view in the operating room because the gown would not extend that far below the patient's knees. Even if the patient identification remains on a wrist bracelet, the surgeon himself could check the patient's name on the bracelet with the name on the office chart just prior to the surgeon and patient entering the operating room. Either practice would add a few seconds to the overall process and would prevent this type of error. On the other hand, the categoric rejection of Respondent's records by Petitioner's expert witness is correct. The date of the operative record is incorrect; it was not dictated on October 17, 2000, but on an earlier date. The three conditions and one alternative present a confused operative history. The operative record fails to indicate if there was a corneoscleral wound; if there was an interrupted suture; if so, if the suture was for a pre-existing astigmatism or for wound protection; and if there was a suture placed at all. With these conditions and alternative, the operative report fails to memorialize accurately material elements of the surgery. Additionally, the operative report omits an indisputably material element of the surgery--the insertion of the wrong lens. Respondent recorded this fact in an office note a few days later, but never amended his predictated operative report to reflect this important fact. Lastly, the justification for the corrective surgery ultimately was the patient's complaint of imbalance, not the difference in refractive power between the lens implanted and the lens specified. Respondent nowhere recorded any such complaint in any records. Based on the foregoing, Petitioner has proved by clear and convincing evidence that Respondent deviated from the applicable standard of care in inserting the wrong lens and failed to maintain medical records justifying the course of treatment with respect to the deficiencies noted in the operative record and post-operative records preceding the corrective surgery.
Recommendation It is RECOMMENDED that the Board of Medicine enter a final order finding Respondent guilty of violating Section 458.331(1)(t), Florida Statutes, and Section 458.331(1)(m), Florida Statutes, imposing an administrative fine of $10,000, and remanding the case to the Division of Administrative Hearings for findings concerning costs, pursuant to Section 456.072(4), Florida Statutes, if the parties cannot agree as to an amount. DONE AND ENTERED this 18th day of December, 2002, in Tallahassee, Leon County, Florida. ROBERT E. MEALE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 18th day of December, 2002. COPIES FURNISHED: Larry McPherson, Executive Director Board of Medicine Department of Health 4052 Bald Cypress Way Tallahassee, Florida 32399-1701 R. S. Power, Agency Clerk Department of Health 4052 Bald Cypress Way, Bin A02 Tallahassee, Florida 32399-1701 Bruce A. Campbell Assistant General Counsel Department of Health 4052 Bald Cypress Way, Bin C-65 Tallahassee, Florida 32399-3265 Brian A. Newman Pennington, Moore, Wilkinson, Bell, & Dunbar, P. A. 215 South Monroe Street, Suite 200 Post Office Box 10095 Tallahassee, Florida 32302-2095
Findings Of Fact The parties further stipulated at the hearing that the billing for which Shands seeks payment does not include charges for services rendered during the months Linda Sue Austin was being treated as an out-patient at Shands. All other facts, as stipulated to by the parties and as set forth above, are hereby adopted.
