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
Findings Of Fact The Respondent, Jayaprakash Kamath, M.D., is a licensed physician in the State of Florida, having license ME 0036704. He is board certified in internal medicine and gastroenterology. He has had no prior complaints of any kind against him since he began practicing medicine in Florida in 1980, and he has a reputation for being a competent and caring physician. On the morning of August 1, 1988, while making rounds at Morton Plant Hospital in Clearwater, Florida, the Respondent was paged by one of his partners, Belur Sreenath, M.D. The Respondent returned the call and was asked to see a patient whom Sreenath had just accepted and admitted on a 23-hour basis at Morton Plant. Sreenath reported that the patient was a referral from the Morton Plant emergency room. The patient's regular physician was on vacation, and the regular physician's on-call cover had recommended to the emergency room physician that the patient be referred to the Respondent and Sreenath to treat the patient for diagnosed fecal impaction. It was reported to the Respondent, through Sreenath, that the patient had come into the emergency room at about five in the morning complaining of abdominal pain and constipation. The emergency room physician, Jerry Julius Chase, M.D., had three X-rays done and had done his own "wet reads" of the X-rays before sending them to the radiology department for a definitive interpretation. According to Chase, the X-rays showed "much fecal matter, no obstruction." Chase did not mention any other significant findings. Chase's preliminary diagnosis was "fecal impaction." Sreenath also reported that he (Sreenath) had ordered enemas for the patient. Soon after the Respondent received the call from his partner, the Respondent called Chase, who was still in the emergency room and still had the X-rays. Chase confirmed what Sreenath had told the Respondent, again not mentioning any other significant findings. After talking to Chase, the Respondent visited the patient in his hospital room. By this time it was about 10:00 a.m. The Respondent took a history from the patient, examined the patient, and read the patient's chart. The chart included the results of lab work and the "ER sheet," which included the emergency room physician's diagnosis of abdominal pain and impaction and the results of his "wet-read" of the X-rays, but it did not yet include a report from the radiology department or the X-rays themselves. The Respondent did not contact the radiology department for a definitive interpretation of the X-rays or obtain the X-rays for his own review. By the time the Respondent saw the patient, the patient already had one enema and seemed to be responding to the treatment. Based on the information he had, the Respondent made a diagnosis of fecal impaction, confirmed his partner's orders for enemas for the patient, and added a stool softener. The nursing staff was ordered to monitor the patient's progress. The patient continued to respond satisfactorily to treatment during the day. Between ten and eleven in the evening of August 1, 1988, the patient complained of some abdominal pain or cramping (symptoms that are consistent with a diagnosis of fecal impaction and enema treatments) and the nurses on duty contacted the Respondent's partner, who was on call. Sreenath ordered a combination of demerol and vistaril as an analgesic. One small dose was enough to relieve the patient's pain, and the patient slept through most of the night. He ate 80% of his breakfast the next morning and was not complaining of pain or asking to see a doctor. At approximately 9:15 a.m. on August 2, 1988, a nurse telephoned the Respondent for a decision whether the patient was being discharged or was being admitted as an inpatient. The Respondent still had not seen the patient's X- rays, seen or had reported to him the radiology report on them, or spoken to the radiologist. On questioning, the nurse reported the patient's status to the Respondent. The nurse's report satisfied the Respondent that the patient was responding to the treatment for fecal impaction and could be discharged. The nurse was given orders to have arrangements made for the patient to see his regular physician within a week and to instruct the patient on symptoms to report if they occurred between discharge and seeing his regular physician. In accordance with the Respondent's telephone instructions, the patient was discharged at approximately 9:30 a.m. on August 2, 1988. Although there were no clinical signs or symptoms of it during the patient's stay at Morton Plant, the patient had a large aortic aneurysm, approximately eight centimeters in diameter, in his abdomen just below the renal arteries. The aneurysm was readily apparent on the X-rays, yet Chase did not report it to either the Respondent or to his partner, Sreenath. The radiologist either did not contact Dr. Chase to point out to him that the report of Chases's "wet read" of the X-rays omitted the aneurysm or, if he did, Chase did not relay this information to the Respondent or his partner. The radiologist's written report, stating that the X-rays revealed the large aneurysm, was sent to Chase, not to the Respondent, and Chase did not relay the information in it to the Respondent or his partner. If the Respondent had known about the aneurysm, he would have considered the aneurysm to be the patient's most serious medical concern. He might not have accepted the patient or, if he did, he probably would have brought a vascular surgeon into the case and had the vascular surgeon, or perhaps a cardiologist, closely monitor the patient for possible leaking or dissecting or rupture of the aneurysm. The Respondent also would have had to give consideration to whether the aneurysm was a cause of the patient's abdominal pain. In addition to treating the aneurysm as the patient's most serious medical concern, giving consideration to whether the aneurysm was a cause of the patient's abdominal pain, the Respondent would have had to give consideration to altering his diagnosis for the patient had he reviewed the X-rays or the radiologist report, or had spoken with the radiologist. In addition to showing the existence of the aneurysm, the X-rays indicated that the patient technically may not have been impacted. (The gas pattern was non-specific.) With respect to this patient, the Respondent practiced medicine below that level of care, skill and treatment which is recognized by a reasonably prudent similar physicians as being acceptable under similar conditions and circumstances (below the standard of care) in that he did not either personally review the X-rays on the patient, read or have reported to him the contents of the radiologist's report, or talk to the radiologist. Instead, he relied totally on the emergency room physician's "wet read." As a result, the Respondent's diagnosis of "fecal impaction" may not have been correct, and he did not give proper consideration to the aneurysm. However, except for the failure regarding the X-rays, the DPR otherwise did not prove that it was below the standard of care for the Respondent, who was treating the patient for fecal impaction, to discharge the patient without seeing him on the morning of August 2, 1988, based on the nurse's report to the Respondent. Although it was below the standard of care for the Respondent not to either read the X-rays himself or obtain the radiologist's definitive interpretation, it was reasonable for the Respondent to expect that the emergency room physician would have told him, and noted in the "ER sheet," that the patient he was being referred had an aneurysm of the kind and size of the one the patient had in this case. Even if the emergency doctor had not initially communicated to the Respondent the existence of the aneurysm, either directly or through the "ER sheet," it was reasonable for the Respondent to expect that, in the normal course, the radiologist reviewing the X-rays would have noted that, according to the "ER sheet," the ER doctor "missed" the aneurysm and would have contacted the ER physician to bring this to his attention, and that the ER doctor then would have contacted the Respondent to advise him of the omission. The patient did not experience abdominal pain after his discharge from Morton Plant, but he began to experience back and groin pain. The aneurysm was becoming symptomatic. The patient's symptoms markedly worsened in the early morning hours of August 4, 1988. The patient's wife had him taken to the emergency room at HCA New Port Richey Hospital at approximately half past midnight. The patient was confused, and was complaining of pain in the back and groin area. His blood sugars were three times normal. He was diagnosed preliminarily in the emergency room as having out-of-control diabetes and confusion and as being near sycope. No X-rays were taken in the emergency room at New Port Richey Hospital, and no information was obtained from Morton Plant Hospital. Because the patient and his wife did not know about the aneurysm, they were unable to report it when the emergency room physician took the patient's history. The patient was admitted to New Port Richey Hospital at approximately 2:30 a.m. on August 4, 1988. However, the admitting physician did not see the patient or order diagnostic medical imaging at that time. The admitting physician saw the patient at approximately 9:00 a.m., and ordered X-rays and a CAT scan. Before the X-rays or CT scan were taken, at approximately ten o'clock, the patient suffered an acute hypotensive event while in his hospital room. An emergency abdominal sonogram was ordered, and it was determined that the patient was suffering from the rupture of the abdominal aortic aneurysm (the same one that was evident on the X-rays taken at Morton Plant). Surgery was attempted to resect the ruptured aneurysm. The patient was a poor candidate for surgery of that kind due to his age and other health factors. The patient died on August 6, 1988. If the patient knew of the aneurysm, it is likely that his treatment on August 4, 1988, would have been far different. First, when the aneurysm became symptomatic, they probably would have contacted the vascular surgeon, who would have been on the case already, either immediately or on arrival at the emergency room. The aneurysm would have been closely monitored from the time of arrival at the hospital, and the vascular surgeon would have been prepared for surgery when indicated. 2/ At the very least, the patient and his wife probably would have reported the aneurysm during the taking of a history in the emergency room at HCA New Port Richey Hospital, and the emergency room surgeon could have immediately taken appropriate steps, such as contacting a vascular surgeon and immediately ordering appropriate diagnostic medical imaging. 3/ The Respondent did not dictate admission notes for the patient until August 17, 1988. The Respondent did not dictate discharge notes. The DPR did not prove that it was below the standard of care for the Respondent to delay the dictation of admission notes or for him not to prepare a discharge summary for a patient in the hospital on a 23-hour basis. The DPR also did not prove that the Respondent failed to keep written medical records justifying the course of treatment of the patient.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Board of Medicine enter a final order: (1) finding the Respondent, Jayaprakash Kamath, M.D., guilty of one count of violating Section 458.331(1)(t), but dismissing the other count of the Administrative Complaint; reprimanding him; and (3) fining him $2,000. RECOMMENDED this 27th day of July, 1992, in Tallahassee, Florida. J. LAWRENCE JOHNSTON 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 27th day of July, 1992.
The Issue The issue presented by the instant case is whether Petitioner's application for a certificate of need to provide inpatient cardiac catheterization services at Pembroke Pines General Hospital should be granted.
Findings Of Fact Based on the evidence received at hearing and matters officially recognized, the Hearing Officer makes the following Findings of Fact: Petitioner and its Parent Corporation Petitioner is a for-profit Florida corporation formed on February 1, 1985, by Encino, California-based Nu-Med Hospitals, Inc. (NM), of which it is a wholly-owned subsidiary. NM provides various administrative services to Petitioner. In return for these services, Petitioner pays NM an annual fee. The fee in 1987 was approximately $1.8 million. In 1988, it was about $952,000. NM has also advanced loans to Petitioner. One such loan was in the amount of approximately $31.4 million at an interest rate of 15.6%, the same interest rate that NM had to pay to obtain the money which was the subject of the loan. Although interest rates have declined, the loan has not been refinanced. The failure to refinance has added substantially to Petitioner's costs. Furthermore, there is a significantly greater cash flow from Petitioner to NM than would be the case had the loan been refinanced. The total pre-tax cash flow from Petitioner to NM, including the amount attributable to the "excess interest" of the aforementioned loan, was $7,900,000 (or roughly 40% of NM's equity investment in Petitioner) in fiscal year 1987 and $4,387,000 (or roughly 23% of NM's equity investment in Petitioner) in fiscal year 1988. In addition to providing administrative services and making loans to Petitioner, NM has also invested more than $17 million over the past four years in Petitioner. Petitioner had an after-tax profit of $852,300 in fiscal year 1987. In fiscal year 1988, it had an after-tax loss of $346,600. Preliminary figures reveal that Petitioner suffered an after-tax loss of slightly more than $1 3l0 in fiscal year 1989. Pembroke Pines General Hospital. Petitioner owns and operates Pembroke Pines General Hospital (PPGH). PPGH is an acute- care hospital with a licensed capacity of 301 beds. It is fully accredited by the Joint Commission on Accreditation of Health Care Organizations. The hospital's bed complement includes 24 intensive care beds (12 coronary beds and 12 surgical beds) 2/ and 32 telemetry beds. Its telemetry unit will be expanded to 48 beds in the near future. In July, 1988, PPGH instituted an eleven bed obstetrical unit. Prior to the acquisition of the hospital in 1985, NM conducted a due diligence study to seek information about the hospital and became aware of the extent of the services provided by the hospital. According to 1987 actual data collected by the Hospital Cost Containment Board (HCCB), PPGH earned a 7.1% return on tangible equity and ranked 7th in this category of the 18 hospitals in Broward County reporting such information; PPGH had a cash flow to total debt ratio of .112% and ranked 9th in this category of the 20 hospitals in Broward County reporting such information; and its total margin percent was 2.6% and it ranked 8th in this category of the 20 hospitals in Broward County reporting such information. According to 1988 actual data collected by the HCCB, in terms of gross revenue per adjusted admission, PPGH ranked 8th of the 30 hospitals in HCCB Group 5 and 3rd of the 20 hospitals in Broward County reporting such information; and in terms of net revenue per adjusted revenue, PPGH ranked 7th of the 30 hospitals in HCCB Group 5 and 5th of the 20 hospitals in Broward County reporting such information. PPGH is located in Respondent's District x, the boundaries of which mirror those of Broward County. It is situated in the southwest quadrant of the county on the corner of Sheridan Street and University Drive. In the area surrounding the hospital is a large concentration of physicians' offices, including one housing a five-member group which limits its practice exclusively to cardiology and is the largest such group in Broward County. The group provides total cardiovascular care to its patients, including echocardiography and nuclear, invasive and clinical cardiology services. It has an active patient case load of 5,000 to 6,000. Of the members of the group, only Dr. Joseph Horgan and Dr. Barry Schiff practice invasive cardiology. Their practice is not confined to invasive cardiology, however. They are also clinical cardiologists. Both are board-certified in internal medicine, as well as cardiology. The Horgan-Schiff group accounts for 15 to 35 patients a day at PPGH, which has an active cardiology service, notwithstanding that it does not offer open heart surgery. The group provides on-site coverage at PPGH from 8:00 A.M. to 7:00 or 8:00 P.M. during the weekday. At other hours members of the group are on call and are able to quickly respond to emergencies at the hospital. Approximately 25 to 30 physicians in the area surrounding the hospital refer their patients who need cardiac catheterizations exclusively to the group. PPGH's primary service area, as defined by Petitioner, is bounded on the north by State load 84, on the south by the Broward County/Dade County line, on the east by the Florida Turnpike, and on the west by the eastern boundary of the conservation area. Included in this area are the cities of Pembroke Pines, Miramar, Davie and Cooper City. Most of Dr. Horgan's and Dr. Schiff's patients reside in PPGH's primary service area. While PPGH is not the only acute-care hospital that serves the residents of this area, it is the only hospital that is located within the area's geographic boundaries. Intervenor PPGH's primary service area is within the jurisdictional boundaries of the South Broward Hospital District (SBHD). SBHD is an independent taxing district which encompasses roughly the southern third of Broward County. It was created in 1947 by a special act of the Legislature to provide quality health care services to the residents of the district regardless of their ability to pay. Hollywood Memorial Hospital SBHD operates several facilities in the district, including a 24-hour walk-in medical center in Pembroke Pines, a freestanding ambulatory surgical center, an oncology center and a radiation therapy center. Its flagship, however, is Hollywood Memorial Hospital (Memorial), a public acute-care hospital that has grown from a 100-bed facility to a 737-bed facility offering a wide variety of health care services. Memorial is located six or seven miles east of PPGH outside of PPGH's primary service area. It is the closest hospital to PPGH. Many of the physicians who have privileges at PPGH also have privileges at Memorial. For instance, 13 of the 16 clinical cardiologists on the medical staff of PPGH, including Dr. Horgan and Dr. Schiff, are also on the medical staff of Memorial. The Horgan-Schiff group is responsible for 10 to 30 patients at Memorial on any given day. Charity Care, Medicaid and Medicare Memorial is the major provider of charity care to residents of the SBHD. In fiscal years 1987, 1988, and 1989, it provided $16,928,000, $22,728,000, and $22,258,000, respectively, in gross indigent charity care 3/ and $6,153 000, $13,739,000, and $7,587,000, respectively, in net unfunded (by tax revenues) indigent charity care. For fiscal year 199(), Memorial projects that it will provide $24,442,000 in gross indigent charity care, of which $14,211,000 will be funded by tax reVenues. A sizeable portion of the hospital's indigent charity care is funded by its operating revenues. During fiscal year 1989, the hospital earned slightly less than $3 million from its operations. Total revenues over expenses that year, however, exceeded $12 million, more than $8 million of which was attributable to returns on its investments. For fiscal year 1988, the hospital's total revenues over expenses was almost $14 million. In calendar year 1986, PPGH furnished 1.1% of the indigent charity care provided in Broward County. It ranked in the top 50% of hospitals in the county in this regard. Memorial ranked 2nd in the county, providing 22.8% of the county's indigent charity care during the calendar year. In calendar year 1987, PPGH provided $596,295 in indigent charity care. This constituted 1.29% of its gross patient revenues. In comparison, during this same period, Memorial provided $18,248,517, or 9.79% of its gross patient revenues, in indigent charity care. In terms of indigent charity care provided during calendar year 1987 as a percentage of gross patient revenue, PPGH ranked 5th of the 12 hospitals reporting in the county and 118th of the 209 hospitals reporting in the state. Memorial, on the other hand, ranked 3rd in the count, behind two other public hospitals, and 19th in the state In calendar year 1988, PPGH ranked 16th of the 30 hospitals in HCCB Group 5 in this category. Of the 20 hospitals reporting in the county, PPGH ranked 10th and Memorial ranked 2nd. Both Memorial and PPGH participate in the Medicaid program. As participants in the program, they are reimbursed for the services they provide to Medicaid patients, but generally not in the amount private pay patients are charged for the same services. The difference between what they receive from Medicaid and what they would have received from a private pay patient is referred to as a "Medicaid deduction." In calendar year 1988, PPGH's "Medicaid deductions" represented .76% of its gross patient revenues. In this category, it ranked 26th of the 30 hospitals in its HCCB group and 8th of the 20 hospitals in Broward County. Memorial, whose Medicaid deductions were 5.29% of its gross patient revenues, ranked 2nd in the county. Based on PPGH's operating budget for calendar year 1989, it ranks 192nd of the approximately 230 acute-care hospitals in the state in the amount of "Medicaid deductions" as a percentage of gross patient revenues. A further comparative review of calendar year 1989 operating budgets reveals that of the 22 hospitals in its HCCB group in calendar year 1989, PPGH ranks last in Medicaid days as a percentage of total patient days. During the third quarter of calendar year 1988, 1.3% of PPGH's gross patient revenues and 5.4% of Memorial's gross patient revenues were attributable to Medicaid patients. PPGH's 1.3% was the 8th highest and Memorial's 5.4% was the third highest of Broward County's 20 hospitals. Pursuant to a contractual arrangement with Respondent, PPGH provides medical services to patients at South Florida State Hospital, a mental health facility operated by the state. In return for the provision of these services;, PPGH is reimbursed at rates comparable to those that apply to Medicaid patients. South Florida State Hospital patients constitute approximately 2 to 5% of PPGH's Average Daily Census. Unlike Memorial, PPGH does not receive any tax revenues to help defray its expenses. PPGH has offered to serve indigent patients who live in the SBHD if the SBHD will reimburse it the same rate the SBHD reimburses Memorial for such services. The SBHD, however, has refused the offer. In terms of Medicare utilization, 1988 HCCB actual data reflects that PPGH ranked 13th of the 30 hospitals in its group and 11th of the 20 hospitals reporting in Broward County. District X Population and Demographics The Executive Office of the Governor, in a report prepared June 22, 1988, estimated that on January 1, 1988, the adult population (15 years of age and over) of Broward County was 1,001,822, and projected that it would increase to 1,047,900 on January 1, 1991. PPGH's primary service area in southwest Broward County has experienced rapid and sustained population growth in recent years. It is the site of several significant retirement communities, including a Century Village development which is expected to have 17,000 residents at build-out. Nonetheless, the population of this area is younger than that of Broward County as a whole. Approximately, 23% of the total population in southwest Broward County is over 55 years of age. While this is two percentage points higher than the national average, it is considerably lower than the countywide figure. Individuals aged 45 to 74 constitute 33.5% of the County's total population, but only 29.7% of the total population of southwest Broward County. The leading cause of death in Broward County is heart disease, a disease to which individuals become more susceptible as they age. Average Daily Census, Occupancy Rates, and Market Scare Notwithstanding the substantial population growth in Broward County, there is now, and has been since at least 1983, a large number of excess hospital beds in District X. The occupancy rates of Broward County hospitals, excluding PPGH, were as follows for calendar years 1983 through 1988: 1983- 65.4%; 1984- 61.3%; 1985- 57.1%; 1986- 55.5%; 1987- 56.2%; and 1988- 52.6%. PPGH, which had a capacity of 301 licensed beds throughout the period, had even lower occupancy rates. During the period, its Average Daily Census (ADC) and, consequently, its occupancy rate declined each year as follows: 4/ Calendar ADC Occupancy Rate 42.5% 37.9% 37.2% 34.1% 32.9% 30.9% Year 1983 127.9 1984 114 1985 111.8 1986 102.6 1987 98.9 1988 93 Based upon statistics for the first six months of calendar year 1989, however, it appears that the hospital's ADC for the entire calendar year will not further decline, but rather will increase to 100.6. 5/ Calendar Year ADC 1983 570.7 1984 533.7 1985 513.6 1986 538.7 1987 552.6 1988 560.5 During calendar years 1983 through 1988, Memorial's occupancy rates far exceeded those of PPGF, as reflected below: Occupancy Rate 78.6% 72.5% 69.7% 73.1% 75.0% 76.1% Based upon statistics for the first six months of calendar year 1989, it appears that for the entire calendar year Memorial's ADC will be 526.5 and its occupancy rate will be 71.3%. Memorial's occupancy rates have been higher than PPGH's due, at least in part, to the fact that Memorial has been able to offer heavily used specialized services not available at PPGH, including neonatal, rehabilitative, and short-term psychiatric care. Furthermore, while PPGH and Memorial both have pharmacy, 6/ physical therapy, nuclear medicine, and cardiac rehabilitation programs, the regular hours of operation of these programs are longer at Memorial. Based upon their ADCs, PPGH's and Memorial's share of the total Broward County market for calendar years 1983 through 1988 was as follows: 7/ Year PPGH 1983 3.6% 1984 3.1% 1985 3.3% 1986 3.1% 1987 3.0% 1988 2.8% Calendar Memorial 16.2% 14.7% 15.1% 16.2% 16.9% 17.2% January, 1988, through June, 1988, discharge data reveals that during that period PPGH and Memorial were responsible for 19.2% and 61.8%, respectively, of the total number of patients from PPGH's primary service area who were discharged from PPGH and District X hospitals with existing or approved inpatient cardiac catheterization programs. Although the ADC for PPGH's total bed complement declined from 1983 to 1988, the number of emergency room visits and emergency room admissions at PPGH increased 18.2% and 31.6%, respectively, during that period. The percentage increases are even greater if only the latter four years of this five-year period are considered. In terms of the average number of critical care beds occupied on a daily basis PPGH has experienced an increase of 28.9% from 1983 to 1988 and an increase of 35.4% from 1984 to 1988. Data reflecting PPGH's performance during the first five and six months of calendar year 1989 indicate that the increase in the number of emergency room visits, emergency room admissions and critical care beds occupied on a daily basis at PPGH has continued. Cardiac Catheterization As accurately described by Respondent in its rules a cardiac catheterization is a medical procedure requiring the passage of a catheter into one or more cardiac chambers of the left and right heart, with or without coronary arteriograms, for the purpose of diagnosing congenital or acquired cardiovascular diseases, or for determining measurement of blood pressure flow. Cardiac catheterization also includes the selective catheterization of the coronary ostia with injection of contrast medium into the coronary arteries. The flow of contrast medium through the coronary arteries may be recorded on x-ray film. The x-ray picture, or angiogram, that is produced can provide information quite helpful to the patient's physician. If it reveals a clot or other blockage restricting the flow of blood to the heart, a balloon-tipped catheter may be used to dilate or open the affected artery. Such a procedure is referred to as a coronary angioplasty. In contrast to cardiac catheterization, which is a diagnostic tool, coronary angioplasty is a therapeutic procedure. A high percentage of patients who receive a coronary angioplasty require open heart surgery immediately following the procedure. Cardiac catheterizations are generally, but not always, elective procedures which need not be performed immediately. There are occasions, however, where a patient is in the throes of a heart attack and requires an emergency coronary angioplasty to restore the flow of blood to the heart to minimize damage to the heart muscle. Under these circumstances, an emergency diagnostic cardiac catheterization, which can be completed in as little as five to six minutes, must also be performed so that the cardiologist will know precisely where in the arterial tree the blockage is located. Respondent permits health care providers to perform such emergency inpatient procedures regardless of whether they possess a certificate of need. Cardiac catheterizations are performed in equipped laboratories and, in the absence of complications, are usually completed within 60 minutes. They may be done on an inpatient or outpatient basis, depending on the condition of the patient. The equipment used is the same, however, whether the procedure is performed on an inpatient or on an outpatient. Recent technological advancements have made it possible to perform more procedures on an outpatient basis than previously. Smaller-sized catheters can now be used. As a result, the entry wound typically heals faster and there are fewer vascular complications. Dr. Horgan and Dr. Schiff were among the first invasive cardiologists in South Florida to employ these smaller- sized catheters. Physicians performing cardiac catheterizations are assisted by technicians and nurses who have specialized skills and training. These technicians and nurses are, at times, in short supply. Competition amongst hospitals to recruit and retain these support staff members is therefore sometimes keen. The majority of cardiac catheterizations are performed on individuals 45 to 74 years of age. 39 There has been no showing that there are any alternative diagnostic procedures which are preferable to cardiac catheterization. District X Inpatient Cardiac Catheterization Programs Broward County is not divided into cardiac catheterization subdistricts. The following seven facilities in Broward County, each of which is within two hours travel time of 90% of the county's population, provide inpatient cardiac: catheterization services pursuant to certificates of need granted by Respondent: Broward General Hospital; Florida Medical Center; Holy Cross Hospital; Memorial; North Broward Regional Medical Center: North Ridge Hospital; and Plantation General Hospital. Broward General, North Broward, and Plantation General each have one cardiac catheterization laboratory. Memorial also has one laboratory, but has plans to construct another pursuant to a "major renovation certificate of need" granted several years ago. It is unclear, however, as to when construction will begin. North Ridge has two laboratories. Florida Medical and Holy Cross each have two laboratories as well, plus one backup laboratory. The average hospital charge and the average length of stay per inpatient admission to these inpatient cardiac catheterization programs during calendar years 1986 and 1987 and the first nine months of calendar year 1988 were as follows: Calendar Average Average Stay 3.71 days 3.27 days 3.43 days 2.98 days 3.70 days 3.00 days Year Charge 1986 (All $4,365.14 Patients) 4936 (Excluding $3,932.44 Medicaid and Medicare) 1987 (All $4,359.92 Patients) 1987 (Excluding $4,041.80 Medicare and Medicaid) 1988 (All $5,054.17 Patients) 1988 (Excluding $4,393.60 Medicare and Medicaid) Cardiac catheterizations are also performed on an outpatient basis at these seven existing facilities. The number of cardiac catheterizations performed in Broward County increased almost 60% from 1985 to 1987, an increase that can be attributed to the aging of the county's population and the advances in cardiac catheterization technology. During the period from April, 1987, through March, 1988, there was a total of 9,289 cardiac catheterization admissions, both inpatient and outpatient, at these facilities, an amount substantially less than their combined capacity. During the period from July, 1987, through June 1988, they also collectively operated well below their combined capacity, handling a total of 9,236 inpatient and outpatient cardiac catheterization admissions Each of the existing laboratories in Broward County can handle at least 1,000 to 1,200 cardiac catheterizations a year during their normal hours of operation with their regular staff. 8/ These laboratories appear to be operating efficiently and to be available to all segments of the county's adult population requiring routine/diagnostic cardiac catheterization services. Furthermore, there is no indication that the quality of care offered at these laboratories is in any way lacking. In addition to these seven existing programs, Respondent has also granted certificates of need authorizing routine/diagnostic inpatient cardiac catheterizations to be performed at two other health care facilities: Imperial Point Hospital and Humana Bennett Hospital. Humana Bennett's primary service area overlaps PPGH's service area. It takes approximately 15 to 20 minutes by car to get to Humana Bennett from PPGH under normal driving conditions. The programs at Imperial Point and Humana Bennett are not yet operational. If their laboratories have hours of operation and staffing levels comparable to those of the laboratories in the county that are currently in operation, these laboratories will also each have the capacity to handle at least 1,000 to 1,200 cardiac catheterizations annually. The same can be said for Memorial's proposed second laboratory. Memorial's Inpatient Cardiac Catheterization Program Since 1981, Memorial's inpatient cardiac catheterization program has been open only to those cardiologists who devote their entire practice to performing cardiac catheterizations. It is closed to cardiologists, like Dr. Horgan and Dr. Schiff, who are not full-time invasive cardiologists. While it has its disadvantages, closing the program in this manner is a policy decision that, on balance, tends to enhance, rather than compromise, the program's efficiency as well the quality of care received by the program's patients. Other cardiac catheterization laboratories in Broward County are "closed" like Memorial's laboratory. The majority of the county's cardiac catheterization laboratories, however, including those at Broward General, Florida Medical, North Broward Regional and Plantation General, have laboratories that are open to any qualified invasive cardiologist. In addition, the laboratories at Humana Bennett and Imperial Point will be "open" when they become operational. In 1984, Dr. Horgan applied for privileges at Memorial's cardiac catheterization laboratory. Following a hearing before the SBHD's Board of Commissioners, final action was taken by the board to deny Dr. Horgan's application. Dr. Horgan appealed the board's decision to the Fourth District Court of Appeal. The board's decision was affirmed by the appellate court. Thereafter, in early 1987, at the request of the administrator of Memorial, Dr. Horgan, as well as his partner Dr. Schiff, discussed with Memorial representatives the possibility of their performing cardiac catheterizations at Memorial. Although approval of such an arrangement was initially given by the hospital, it was later withdrawn after members of the hospital's cardiology department complained about the arrangement. At present, three full-time invasive cardiologists, Dr. Mario Sperber and his partners Dr. Barry Alter and Dr. Michael Mareke have privileges to perform cardiac catheterizations at Memorial. They charge $1-500 for a routine/diagnostic left and right heart catheterization. Included in this charge is a fee of $191 that is passed on to the radiologist who assists in the interpretation of the angiogram. Because it has an open heart surgery program, Memorial is also authorized to perform routine/non-emergency angioplasties. These angioplasties are performed in Memorial's cardiac catheterization laboratory. The total number of procedures done in this laboratory during fiscal year 1988 was 1,635, seven of which were performed on Medicaid patients and 176 of which were performed on an outpatient basis. The total number of procedures, including angioplasties, done in Memorial's cardiac catheterization laboratory during fiscal year 1989 increased slightly to 1,650. The number of those procedures performed on an outpatient basis, however, almost doubled. The ratio of routine/diagnostic inpatient cardiac catheterizations to routine/diagnostic outpatient cardiac cathetrizations performed at Memorial has decreased from about 6 to 1 to approximately 4 to A further decrease is likely in view of the technological improvements that have been made. During calendar year 1988, 1,238 routine/diagnostic cardiac catheterizations, 234 angioplasties, and 512 open heart surgeries were performed at Memorial. During the first six months of calendar year 1989, there ware 680 routine/diagnostic cardiac catheterizations, 168 angioplasties, and 241 open heart surgeries done at Memorial. Approximately 23% of the total number of inpatient procedures performed in Memorial's cardiac catheterization laboratory during the first six months of calendar year 1988 were done on patients who resided in PPGH's primary service area. From fiscal year 1988 to fiscal year 1989, the revenues over direct expenses of Memorial's cardiac catheterization laboratory increased slightly. PPGH's Cardiac Catheterization Laboratory In addition to the previously mentioned cardiac catheterization laboratories in Broward County, there is also a 695-square foot cardiac catheterization laboratory located inside the operating room suite at PPGH. Cardiac catheterizations are performed at this laboratory, however, exclusively on an outpatient basis. It is the only such outpatient laboratory in Broward County and it was the first of its kind in South Florida. The laboratory at PPGH is leased to a Florida limited partnership, University Heart Institute, Ltd (Partnership) which operates the outpatient cardiac catheterization program at the hospital. 10/ The leasing of a department of a hospital is not an uncommon practice in Broward County. Petitioner provides the space needed to operate the outpatient cardiac catheterization program at PPGH, as well as other support services, pursuant to a management agreement with the Partnership. In return for the space and services it provides, Petitioner receives a nominal sum of $1.00 a month from the Partnership. The management agreement has a termination provision which permits Petitioner to terminate the agreement if, at any time after the first twelve months, "the Partnership has a negative cash flow over a period of six or more calendar months." Petitioner is a 50% general partner of the Partnership. Accordingly, pursuant to generally accepted accounting principles, Petitioner must reflect: the financial activities of the Partnership on its balance sheet as though they were its own. The other general partner in the venture is University Hospital, Inc., (UHI), a corporation controlled by Dr. Horgan and Dr. Schiff and their partner, Dr. Dweck. Petitioner and UHI have equal control over the Partnership. There are also about 20 limited partners, all of whom are physicians. The profits and losses of the Partnership are divided as follows: 50% to Petitioner; 25% to UHI; and 25% to the limited partners. During the first year of operation of the cardiac catheterization laboratory, the Partnership earned a profit of approximately $100,000. PPGH's cardiac catheterization laboratory began operation on April 29, 1988, after the area of the hospital in which it is located received less than $50,000 worth of renovation work. Two-hundred and forty-eight outpatients received cardiac catheterizations at the laboratory in the first twelve months of its operation. During the thirteenth month of its operation, cardiac catheterizations were done on an additional 22 outpatients. Of the 270 outpatients who received cardiac catheterizations during the first thirteen months of the laboratory's operation, only one was a Medicaid patient. The overwhelming majority of outpatients who have received cardiac catheterizations at PPGH's laboratory have been from southwest Broward County and have been referred to the laboratory by Dr. Horgan and Dr. Schiff. Dr. Joseph S. Horgan, M.D., P.A., and Dr. Barry H. Schiff, M.D., P.A., are the exclusive providers of cardiac catheterization services at PPGH's laboratory pursuant to a professional services agreement they entered into with the Partnership. Under the agreement, only "physicians that are associated with, employed or otherwise engaged under contract with" these two Florida corporations run by Dr. Horgan and Dr. Schiff, respectively, may use the laboratory. Dr. Horgan and Dr. Schiff therefore have the sole authority to determine who may perform cardiac catheterizations at PPGH's laboratory. They also serve as co-medical directors of the laboratory and, in these capacities, are responsible for the development and implementation of all policies pertinent to the operation of the laboratory. To date, only Dr. Horgan and Dr. Schiff have performed cardiac catheterizations at the laboratory. A third invasive cardiologist, however, will soon join Dr. Horgan and Dr. Schiff in providing such services at the hospital. The hospital's laboratory will be closed to all other invasive cardiologists. Dr. Horgan and Dr. Schiff charge $950 for a routine/diagnostic right or left heart catheterization and $1,175 for a routine/diagnostic right and left heart catheterization. These charges are consistent with the provision of the professional services agreement with the Partnership which requires that their fees "be competitive with the usual and customary fees charged in the community for similar services." Under the agreement, Dr. Horgan and Dr. Schiff are entitled to keep the fees they receive for the professional services they render. Most of Drs. Horgan's and Schiff's patients receive a right and left heart catheterization. As a result, they average 1.8 procedures per patient and their average charge per patient is $1,100. Unlike the invasive cardiologists who practice at Memorial's laboratory, Dr. Horgan and Dr. Schiff do not utilize radiologists to assist them in interpreting the angiograms they produce. Dr. Horgan and Dr. Schiff have proven to be highly competent and skilled invasive cardiologists and they offer high quality care to the outpatients they catheterize at PPGH's laboratory. There have been no moralities at the laboratory and only a few outpatients have experienced complications after being catheterized. Furthermore, approximately 91% of the catheterizations performed at the laboratory reveal some abnormality. This high rate of abnormal catheterizations suggests that Dr. Horgan and Dr. Schiff are exercising sound judgment in referring outpatients to the laboratory, as opposed to making these referrals without justification. In the professional services agreement with the Partnership, Dr. Horgan and Dr. Schiff have agreed "not to provide outpatient cardiac catheterization and peripheral vascular procedure services within Broward or Dade Counties, Florida for a two (2) year period after the commencement of the term of this Agreement [at any facility other than PPGH] except that [they) shall continue to provide such services at Plantation General Hospital, Florida Medical Center, University of Miami, Jackson Memorial Hospital and Cedars Medical Center of Miami." Most of the cardiac catheterizations that Dr. Horgan and Dr. Schiff perform are done on an outpatient basis. They do cardiac catheterizations on an inpatient basis only if the patient's medical condition warrants. They perform these inpatient cardiac catheterizations at Florida Medical and Plantation General. Between May 1, 1988, and April 30, 1989, they performed inpatient cardiac catheterizations on about 125 to 150 patients in these two facilities. Florida Medical and Plantation General are each within a half hour driving time of PPGH. Florida Medical offers open heart surgery and routine/non-emergency angioplasty. Plantation General has received preliminary approval from Respondent to provide open heart surgery services. Dr. Horgan's and Dr. Schiff's patients receive good care at Florida Medical and Plantation General. In addition to performing these inpatient cardiac catheterizations at Florida Medical and Plantation-General, during the one year period ending April 30, 1989, they also referred approximately 160 patients to Memorial for cardiac catheterization services. If Petitioner had the certificate of need that it is seeking in the instant case, none of these referrals would have been made. When they are performing cardiac: catheterizations at PPGH, Dr. Horgan and Dr. Schiff are assisted by a highly qualified and well-trained support staff consisting of a catheterization technician and three Registered Nurse's, one of whom is the staff director. All four staff members are employees of Petitioner, not the Partnership. Their combined annual salaries total about $119,000. Collectively, they receive approximately another $36,000 from Petitioner in fringe benefits. The Partnership reimburses Petitioner for monies expended “0 compensate these staff members for the work they perform in PPGH's cardiac catheterization laboratory. These staff members, however, do not work full-time in the laboratory. They are also assigned to other-areas of the hospital, most notably the intensive care unit. The majority of cardiac catheterization laboratories in Broward and Dade Counties have support staffs similar in size to the support staff assigned to PPGH's laboratory. The equipment in PPGH's cardiac catheterization laboratory was purchased by the Partnership from Dr. Horgan at Dr. Horgan's cost. Dr. Horgan paid approximately $250,000 for the equipment when he purchased it from EWA Industries, Inc., shortly before the opening of the laboratory. A portion of the money Dr. Horgan used to pay for the equipment came from a loan he received from Petitioner. At the time of its original purchase, the equipment was, for the most part, newly reconditioned. The equipment is not "state-of-the-art." It lacks certain features that are available on other equipment, such as digital/computer analysis capability. These features, however, are of relatively insignificant value. Despite lacking these features, the equipment in PPGH's outpatient cardiac catheterization laboratory is more than adequate, as evidenced by the high quality of Dr. Horgan's and Dr. Schiff's angiograms. Furthermore, although the equipment is made of parts manufactured by different manufacturers, obtaining parts for repair is not a major problem. They are readily available from EWA, which is based in Miami. In addition, there are two distributors and service centers located in Broward County from whom replacement parts may be obtained. Although PPGH has the medical and support staff and the equipment, as well as the ancillary services, necessary to provide routine/diagnostic cardiac catheterization services to inpatients at the hospital, it has not been authorized to do so by Respondent. PPGH's inability to offer these inpatient services places it at a competitive disadvantage relative to those facilities in the county that are authorized to provide these services. For instance, it makes it more difficult for PPGH to compete for contracts with health maintenance organizations and other third party payers. More significantly, PPGH's competitors offering inpatient cardiac catheterization services are able to capture patient revenues that would otherwise be received by PPGH if it were able to provide such services. PPGH's situation, however, is not unique. The majority of hospitals in Broward County are not authorized to offer inpatient cardiac catheterization services. Moreover, even though its competitive position would be enhanced if it were able to offer such services, its inability to do so does net threaten its survival as a health care facility in the Broward County market. If an inpatient at PPGH needs a routine/diagnostic cardiac catheterization that, because of the patient's unstable medical condition, cannot be performed on an outpatient basis, the patient must be transferred to another facility that is authorized to provide inpatient cardiac catheterization services. During fiscal year 1988, PPGH transferred 106 such patients to other facilities to receive inpatient cardiac catheterizations. Even if PPGH had been able to provide inpatient cardiac catheterization services to these patients, some of them would have had to have been ultimately transferred to another facility in any event to receive routine/non- emergency angioplasty or open heart surgery. Patients transferred from PPGH to another facility to receive cardiac catheterizations on an inpatient basis are generally transported by ambulance. A round-trip ambulance ride from PPGH typically costs between $500 and $700. In addition to increasing these patients' costs, such transfers may also cause them to experience additional stress. Clearly, in hindsight, it can be said that these transferred patients would have been better off if they had been initially admitted to a facility with inpatient cardiac catheterization capability instead of PPGH. Unfortunately, however, it is often difficult to determine at the time of admission whether a patient will need cardiac catheterization services. Furthermore, there are occasions where a patient arrives at PPGH's emergency room in such a medically unstable condition that he must wait at the hospital until his condition improves before he can be transported to another facility. It is not uncommon for Dr. Horgan's and Dr. Schiff's patients who need to be transferred from PPGH to receive an inpatient cardiac catheterization to have to wait two or three days before there is an opening in the cardiac catheterization laboratory schedule at Florida Medical or Plantation General that is convenient to them and their physician. During this time, these patients remain at PPGH, thus increasing the length of their stay there and they undergo expensive diagnostic testing designed to provide information that may be useful in managing these patients until they are able to be transferred and catheterized. While such scheduling problems have been experienced in the past, the situation should improve when the laboratories at Imperial Point and Humana Bennett become operational. Furthermore, there has been no Chowing that the patients who had to wait two or three or more days to be transferred from PPGH to Florida Medical or Plantation General could not have received such services at another existing provided, such as Memorial, had they so desired. Patients of Dr. Horgan and Dr. Schiff have died at PPGH while waiting to be transferred to another facility to receive an inpatient cardiac catheterization. A significant number of these patients could have survived had they received an emergency cardiac catheterization and angioplasty. Although the necessary equipment and staff were available at PPGH to perform these procedures, these procedures were nonetheless not performed. Because these were emergency situations where the 34 patients' lives were threatened, PPGH's lack of a certificate of need did not preclude Dr. Horgan and Dr. Schiff from performing these procedures at PPGH. Petitioner's Application for a Certificate of Need Approximately five months after the first outpatient cardiac catheterization procedure was performed at PPGH, Petitioner submitted an application for a certificate of need to provide inpatient cardiac catheterization services at the facility. Petitioner proposes to use, in providing these services, the same laboratory, equipment and staff it now uses for its outpatient program. The application estimates that the total cost of the project will be only $10,000, which represents "the legal and consulting fees associated with the Certificate of Need Application." There will be no financing, refinancing, professional services, construction or equipment costs, according to the application. In estimating the total cost of the project, Petitioner does not include the costs that were incurred to commence operation of PPGH's outpatient cardiac catheterization program, notwithstanding that these costs were incurred in contemplation of the filing of the instant application. 11/ The application also contains an estimate of revenues and expenses for the first two years of operation of the proposed project. The estimate includes projected revenues and expenses attributable to both the inpatient and outpatient operations of the laboratory. Petitioner projects in its application that 532 patients (320 inpatients and 212 outpatients) will visit PPGH's cardiac catheterization laboratory the first year it is able to offer inpatient services 12/ and that 592 patients (355 inpatients and 237 outpatients) will visit the laboratory the following year. Given Dr. Horgan's and Dr. Schiff's track record 13/ and reputation and the financial interest they have in the successful operation of the laboratory, 14/ it is not unreasonable to believe that they will attract these projected numbers of patients to the laboratory. Moreover, they, along with the third invasive cardiologist who will soon join them, should easily b able to handle such patient case loads at the laboratory during reasonable hours of operation with the laboratory's existing support staff and equipment. In projecting the gross revenues that will be generated by the inpatients who visit the laboratory, Petitioner assumes that these inpatients will be charged an average of $4,935 per patient the first year and $5,176 per patient the second year. These charges are consistent with the average charges of existing providers in the county. With respect to outpatients, Petitioner assumes that they will be charged on the average $2,300 per patient the first year and $2,415 per patient the second year. These charges are consistent with the laboratory's current average charge per outpatient. In view of the foregoing, Petitioner's projections in its application regarding gross revenues are reasonable. Of the patients that will visit the laboratory during the first two years of the inpatient program, Petitioner projects in its application that 2% will be Medicaid recipients and 3% will receive charity or free care. In view of PPGH's past performance in these areas, it appears unlikely that these percentages will be realized.15/ Accordingly, Petitioner's projections in its application regarding the deductions from gross revenues for Medicaid contractual allowances and charity care are unreasonably high. The projections made by Petitioner regarding direct and indirect expenses, in the aggregate, are not unreasonably low, notwithstanding that the application's statement of projected revenues does not make specific reference to certain expense items relating to inpatient care, such as nursing care and food supply costs. If anything, Petitioner has overestimated total expenses.16/ Providing only outpatient services, which generate less net income per patient than do inpatient services, the laboratory at PPGH returned a profit of approximately $100,000 in its first year of operation. The profitability of the laboratory will likely increase, as Petitioner projects, if it is able to offer inpatient, in addition to outpatient, services. In both the short-term and the long-term, Petitioner' proposal to provide such services is financially feasible. As evidenced by the attachments to Petitioner's application, as supplemented in response to Respondent's October 13, 1988, omissions letter, PPGH has transfer agreements with St. Francis Hospital and Florida Medical, both of which are within thirty minutes driving time of PPGH and have open heart surgery capability. Potential Impact of Granting the Application While Petitioner will benefit if its application is granted, the same cannot be said for existing providers of 16 For example, Petitioner allocates the entire salary of each of the four support staff members to the cardiac catheterization laboratory, even though these employees also work in other parts of the hospital. 38 inpatient cardiac catheterization services in Broward County. They will have to contend with another effective competitor seeking a share of the already highly competitive Broward County inpatient cardiac catheterization market. Collectively, the existing facilities will lose inpatient cardiac catheterization patients and net revenues they otherwise would have had if the laboratory at PPGH did not offer inpatient services.17/ Memorial will be among those `facilities suffering the greatest such losses. While it is difficult to predict the precise extent of these losses, they no doubt will be significant and therefore adversely impact Memorial's ability to provide charity care. At the very least, Memorial will lose to PPGH the inpatient cardiac catheterization patients that Dr. Horgan and Dr. Schiff now refer to Memorial's laboratory and the net revenues these patients generate. As previously mentioned, Dr. Horgan and Dr. Schiff referred 160 patients to Memorial's laboratory during the year ending April 30, 1989.96. Routine/non-emergency angioplasties and open heart surgery will not be performed at PPGH if Petitioner's application is granted. Accordingly, Memorial will not lose to PPGH any patients requiring these services as a result of the granting of the application. Although patients at PPGH who require routine/diagnostic inpatient cardiac catheterization services will not have to be transferred to another facility to receive inpatient cardiac catheterizations if the application is granted, it will still be necessary to transfer patients needing routine/non-emergency angioplasty and open heart surgery. With the advent of an inpatient cardiac catheterization program at PPGH, the hospital will attract, in far greater numbers than it does presently, individuals who require, not only inpatient cardiac catheterization services, but also routine/non emergency angioplasty or open heart surgery and who therefore must be transferred to another facility. Therefore, there likely will be more, rather than fewer, total transfers of patients than there would be if PPGH did not offer inpatient cardiac catheterization services.18/ Although cardiac catheterization support staff are generally difficult to recruit and retain, the granting of the instant application will not make it any more difficult for existing providers in Broward County to attract and keep such staff members inasmuch as Petitioner already has a support staff assigned to its cardiac catheterization laboratory at PPGH and it does not intend to expand its staff if it is given authorization to provide services at the laboratory on an inpatient basis. Regardless of whether Petitioner's application is granted, the adult population of Broward County requiring inpatient cardiac catheterization services will be able to receive such services from existing and approved providers in the county, which have the collective capacity to meet the population's demand for these services. It is more efficient to make greater use of the current collective capacity of these providers than to add to the county's overall capacity to serve cardiac catheterization inpatients. Furthermore, there is no reason to believe that PPGH will provide quality of care appreciably different from that offered by any existing or approved inpatient cardiac catheterization provider. Even if Petitioner's application is denied, patients of Dr. Horgan and Dr. Schiff who live in the area surrounding PPGH will still be able to receive routine/diagnostic cardiac catheterizations from these two invasive cardiologists, albeit at a facility that is slightly further from their homes and Dr. Horgan's and Dr. Schiff's offices than is PPGH. If an inpatient cardiac catheterization program is established at PPGH, the program's charges will be comparable to those of its competitors. They will neither be excessive, nor unusually low, in relation to those of other programs. Accordingly, approval of the program will have no significant impact on costs and patient charges. Florida Administrative Code Rule 10-5.O11(1) Respondent has adopted procedures governing its review of applications, such as Petitioner's, for certificates of need authorizing the establishment of an inpatient cardiac catheterization program. These procedures are found in Florida Administrative Code Rule 10- 5.011(1)(e).41 Respondent published notice in the April 22, 1988, edition of Florida Administrative Weekly of the amendments it proposed to make to the rule as it existed at that time. (The version of the rule that Respondent sought to amend Bill be referred to hereinafter as the "old rule.") These proposed rule amendments were the subject of rule challenge petitions filed with the Division of Administrative Hearings. The petitions were voluntarily dismissed after the challengers and Respondent negotiated a settlement, pursuant to which Respondent made certain modifications to the proposed amendments to Rule 10- 5011(1)(e). Among the modifications was the addition of the following language relating to the intent of the rule: It is the intent of the department to allocate the projected growth in the number of cardiac catheterization admissions to new providers regardless of the ability of existing providers to absorb the projected need. In addition, the prefatory language of the provision relating to need determination was modified to read as follows: In order to assure patient safety and staff efficiency, to foster competition among providers, and to achieve maximum economic use of existing resources, the following criteria shall be considered in the approval of Certificate of Need applications for new adult cardiac catheterization programs. The minimum annual projected net program volume need for the establishment of a new adult cardiac catheterization program shall be at or exceed 300 admissions for the service planning area. Applicants shall demonstrate that they will be able to reach an annual program volume of 300 admissions within 2 years after the program becomes operational. Notice of these changes and the other modifications that were made to the April 22, 1988, proposed rule amendments was published in the July 29, 1988, edition of Florida Administrative Weekly. Eleven days earlier, these proposed rule amendments, as modified, (hereinafter referred to as the "new rule") had been filed with the Secretary of State. In August 1988, the new rule was challenged on the ground that Respondent had not complied with the procedural requirements of Section 120.54, Florida Statutes, in making changes to the proposed rule amendments originally published on April 22, 1988.19/ The hearing officer assigned to these cases treated the rule challenge petitions as having been filed pursuant to Section 120.54, Florida Statutes, rather than Section 120.56, Florida Statutes, notwithstanding that the new rule had been filed with the Secretary of State more than 20 days prior to the filing of any of these petitions. Following a hearing on the matter, the hearing officer, on June 29, 1989, entered a final order holding that "the amendments to paragraph 2 (h), paragraph 3(c) III, and paragraph 6(a) and the amendment regarding the definition of `inpatient visit' are an invalid exercise of delegated legislative authority, because they were adopted without adhering to the proper procedures for adoption delineated in Section 120.54, Florida Statutes." On or about July 27, 1989, Respondent appealed the hearing officer's final order to the First District Court of Appeal. The appeal is still pending. Since August, 1988, Respondent has been applying the new rule in evaluating inpatient cardiac catheterization certificate of need applications. It applied the new rule in making its preliminary determination to deny Petitioner's application, which was in the first batching cycle after the effective date of the new rule.20/ Although the packet of application materials Respondent sent to Petitioner did not contain any express indication that the new rule would be applied in evaluating its application, Petitioner conceded in its completed application that it had "been informed [through other means) by [Respondent) that the [new rule would] likely be used in evaluating this CON application." In view of this advisement, Petitioner addressed in its application the various provisions of the new rule as they related to its application. The State Health Plan Issues relating to cardiac catheterization are discussed in the 1985-1987 State Health Plan. Among such issues is that of minimum case loads. Regarding this issue, the plan contains the following discussion: Up until 1977 the literature showed a consensus on the need for minimum case loads. Since 1977, expert opinion has become more divided on the issue with many provider representatives advocating that the standards now reflected in federal and many state laws are no longer necessary and justifiable. However, a general opinion among the medical profession is that a certain minimum number case load is essential to assure quality results. A number of complications can occur in catheterization programs if all personnel are not experienced and active. Studies may have to be repeated because inadequate data were received. This could result in unnecessary exposure of patients to radiation and hazards caused by the injection of of engaged contrast materials and the manipulation catheters. The established federal and state minimum standards of 300 procedures annually for adult and 150 for pediatric cardiac catheterization laboratories are believed to be adequate to maintain the expertise of the professional team in this highly specialized service. The plan also addresses the "concern surrounding. . . the physical proximity and the relationship between the [cardiac catheterization] diagnostic facility and a cardiovascular surgical program." It notes that the "Inter-society Commission on Heart Disease Resources (ISCHDR) stresses the need for a very close relationship between the two services;" "national health planning guidelines support this emphasis through a recommendation that no new cardiac catheterization unit be opened in any facility not providing open heart surgery;" and the "Florida rule requires that cardiac catheterization laboratories where coronary angioplasty (e.g., plastic surgery upon blood vessels) is performed must be located in health care facilities which also provide open heart surgery." One of the goals of the State Health Plan is to ensure the appropriate availability of cardiac: catheterization services at a reasonable cost. An objective of the plan is to "maintain an average of 600 cardiac catheterization procedures per laboratory in each district through 1990." The project proposed by Petitioner in the instant case conforms with this goal and objective to the extent that the services offered at PPGH will be competitively priced and that it is likely that the laboratory at PPGH will average at least 600 procedures annually. Local Health Plan The 1988 District X Comprehensive Health Plan contains the following analysis and recommendation with respect to the provision of cardiac catheterization services in Broward County: AVAILABILITY AND ACCESSIBILITY The hospitals offering cardiac catheterization services are well located throughout the County for geographic accessibility. Financial barriers continue to raise questions about accessibility of these services to the poor. QUALITY All of the facilities offering cardiac catheterizations in Broward County are providing in excess of the minimum number of procedures recommended.21/ RECOMMENDATION 1 Applicants for Certificate of Need approval should document either their intention and/or experience in meeting or exceeding the standards promulgated by the appropriate national accreditation body and by HRS. RECOMMENDATION 2 Applicants proposing to initiate or expand cardiac catheterization must make those services available to all segments of the population regardless of the ability to pay. RECOMMENDATION 3 Outpatient cardiac catheterization services should continue to be regulated under the Certificate of Need program. Petitioner has demonstrated that the inpatient cardiac catheterization program it proposes to establish at PPGH will meet or exceed the accreditation standards referred to in Recommendation 1 of the plan. Petitioner's stated policy is to make the services of PPGH available to all segments of the population regardless of their ability to pay. Petitioner's past performance in the area of indigent care suggests, however, that Petitioner may not be firmly committed to implementing this policy. The suggestion is also made in the plan that "[a)11 else being equal applications to establish new cardiac catheterization laboratories in Broward County in facilities with existing open heart surgical capability will receive priority - when being considered for certificates of need."
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that Respondent enter a final order denying Petitioner's application for a certificate of need to establish an inpatient cardiac catheterization program at Pembroke Pines General Hospital. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 12th day of January, 1990. Administrative Hearings Parkway 32399-1550 of the Administrative Hearings January, 1990. STUART M. LERNER Hearing Officer Division of The DeSoto Building 1230 Apalachee Tallahassee, Florida (904) 488-9675 Filed with the Clerk Division of this 12th day of
Findings Of Fact Fawcett's Application. Petitioner, Fawcett, is a 254 bed acute care hospital located in Port Charlotte, Charlotte County, Florida. Its primary service area is Charlotte and DeSoto Counties, Florida. Fawcett's secondary service area includes parts of Sarasota and Lee Counties, and all of Glades County. Fawcett timely filed an application for a CON to establish an adult cardiac catheterization lab at its facility in Port Charlotte, Florida, on October 15, 1985. Fawcett's application was denied by Respondent, HRS, on February 28, 1986. Fawcett's proposed cardiac cath lab would be located in the special procedures suite at Fawcett, specifically, special procedures Room NO. 2. It is the intention of Fawcett that the cath lab operate in conjunction with the special procedures laboratory as it exists currently at Fawcett. The cardiac cath lab will have an open staff policy, meaning that any physician meeting the training and experience criteria under the medical staff bylaws will be able to participate in the lab. Regular service hours will be from 7:00 a.m. to 4:30 p.m., Monday through Friday. In addition to this, the lab will be capable of providing emergency care twenty-four hours a day, seven days a week. Cardiac cath services will be available to all persons regardless of race, ethnic minority, sex, handicap, and inability to pay who, by physician's order, are in need of a cardiac cath. Fawcett proposes to open the cardiac cath lab as soon as is practicable, setting a target date to open no later than July 1, 1987. Need. Rule 10-5.011(1)(e)12, Florida Administrative Code (1986), states that need for a cardiac cath lab is to be determined by computing the projected number of cardiac cath procedures in the service area, using a mathematical formula. "Service area" is defined as the entire HRS district, in this case District 8. Utilizing this formula, the actual use rate in the service area for the 12-month period beginning 14 months prior to the letter of intent deadline for the batching cycle is multiplied by the projected population in Year "X", the year in which the proposed cardiac cath lab would begin service, to give a projected number of cath procedures for Year "X". This projected number of cath procedures is then divided by 600 (the average number of caths required by the rule to be performed per year by existing and approved labs) to yield the number of labs needed in the District. Utilizing this formula, a mathematical need is not shown for District 8. Indeed, the rule methodology shows a need for only five cardiac cath labs in District 8 in July, 1987, and there already are seven existing and approved labs in District 8, not counting Fawcett's proposed lab. Rule 10-5.011(1)(e)6, Florida Administrative Code (1986), states that "[t]he Department will not normally approve applications for new cardiac cath laboratories in any service area unless additional need is indicated." (Emphasis added.) Mortality Rate. Charlotte County has a significantly higher mortality or death rate per 100,000 persons than either the State of Florida or the United States as a whole. Charlotte County's mortality rate is high even when compared to the rest of District 8. The mortality rate from cardiovascular disease in District $ is likewise high. The mortality rate from heart disease in District 8 is 453.2 per 100,000 deaths, with the rate for Florida being 389.4 per 100,000 deaths, and the United States 325 per 100,000 deaths. In contrast to the death rate in other District 8 counties due to cardiovascular disease, Charlotte County's rate of mortalities due to cardiac disease is 619 per 100,000 deaths. Cardiac cath has become the standard treatment modality for dealing with serious cardiovascular disease. Cardiac cath has the potential to greatly decrease deaths due to cardiovascular disease in Charlotte County, where there is a large patient population in Charlotte County who could benefit from this service. Population Growth. Charlotte County has a very high rate of population growth in relation to Florida and the rest of the United States. The rate of growth between 1986 and 1991 will be approximately 23 percent, compared to Florida's overall growth rate of approximately 11 percent and the United States' growth rate of 3 percent. Charlotte County ranks ninth in the United States in terms of population growth from 1980 to 1985 for counties with populations of 50,000 or more. A large proportion of the overall 23 percent growth rate is comprised of the elderly population, aged 65 and over. The 65 and over population is expected to grow by 31 percent between 1986 and 1991 in Charlotte County. This is compared to a projected 18 percent growth of this group in Florida, and a projected 11 percent growth in the United States as a whole for the same time period. Elderly Population. Charlotte County has a population which is heavily weighted toward the elderly when compared to Florida and the United States. An estimated 36.5 percent of the Charlotte County population is aged 65 and over, compared to 19 percent for the State of Florida and 12 percent in the United States as a whole. Fawcett is dependent on the elderly population for its patients, including in the area of cardiac-related services. The majority of cardiac cath patients in Charlotte County are taken from the 65 and over population. Upward Trend in Number of Cardiac Caths. Cardiac cath is the process of taking a sterile plastic tube and placing it into the left or right section of the heart. This allows the cardiologists to perform a combined study, obtaining pressures from the right and left ventricles, as well as injecting dye into the heart's various arteries to take pictures. These two combined studies allow the physician to make as accurate a diagnosis as possible. Cardiac cath has become very important in recent years, so much so that hospitals with advanced cardiac programs which are willing to make the commitment should have cardiac cath to ensure state of the art quality care to the patients. Cardiac cath has become a routine procedure in the treatment of heart- related disorders. Patients with a myocardial infarction (development of lack of blood flow to the heart muscle) are now immediately cathed and diagnosed. This is important in light of the major advances recently made in angioplasty, a non-surgical method of treating blocked cardiac vessels. The current treatment modality is to get information on the problem immediately and reopen the blood vessel that is obstructed to allow blood to get in the heart muscle, thereby avoiding further damage to the heart muscle. There has been a consistent trend upwards in the rate of cardiac caths performed in District 8 relative to its population. The actual use rate for cardiac caths has increased, and the 1986 use rate is higher than the use rate utilized by the rule methodology. In other words, the use rate called for in the rule understates what is actually happening in 1986. The use rate increased approximately 40 percent between 1985 and 1986. The Charlotte County area has experienced an increase in the rate of growth of cardiac caths overall. The evidence reveals an upward trend in utilization of cardiac cath on a national scale. Cardiac cath probably will become a more and more prevalent treatment modality and therefore should be more readily available, with wider application of technological advances, in the future. As more caths are done, the procedure becomes safer and more accessible to people. Medical science has now made it possible for 20 to 30 percent of all persons who suffer heart attacks to be treated without major cardiac surgery, i.e., via a technique called angioplasty, whereby an occlusion or blockage is decreased by the expansion of a balloon in the diseased vessel. Cardiac cath is a necessary step in identifying the need for the angioplasty procedure. Fawcett's Degree of Reliance on the Elderly Population and Its Cardiac Programs. Fawcett is unusual in its degree of reliance on the elderly population. Over two-thirds of all Fawcett's patients are Medicare patients (over age 65), an unusually high number of elderly patients. Approximately 20 percent of Fawcett's 1985 admissions were cardiac disease related. These patients constitute a large percentage of Fawcett's patient revenues. In an area like Port Charlotte, which is so heavily populated with the elderly, it is desirable from the standpoint of patient care to have needed cardiac cath services available to patients at their primary care hospital. Fawcett is the primary care hospital for a large portion of the Charlotte County population. New Service at Minimal Cost. Fawcett proposes to establish its cardiac cath lab at a cost of roughly $90,700. This is a relatively small capital expenditure to add a new cardiac cath service to a facility. Many hospitals must make expenditures of as much as $1,000,000 to add a cardiac cath lab to their facilities. Fawcett already has the bed capacity to handle any additional inpatients which may result from the addition of a cath lab. No recruiting of physicians or the cost associated with such recruiting would be involved. Fawcett currently has 11 cardiologists on staff. Additionally, the rule requires that a certified or board eligible cardiologist be director of the cardiac cath lab, and Fawcett has several certified cardiologists on staff who qualify for this position. Medical Center And Other District 8 Providers. Intervenor, Medical Center Hospital (Medical Center) is a 208-bed facility. 52 beds are used for substance abuse psychiatric service, 156 are acute care beds with psychiatry, oncology, and cardiac facilities. The hospital is a not-for-profit hospital. Medical Center has a Medicaid provider number and has had one for at least seven years. For 1984, Medical Center provided approximately $37,000 worth of charity care; $105,000 for 1985; and through December 4, 1986, $258,000. The amount was anticipated to be as high as $350,000 for 1986. Medical Center is in Punta Gorda, 5 1/2 miles south of Fawcett. Medical Center's primary service are is Charlotte County; it draws approximately 90 percent of its patients from Charlotte County. The remaining ten percent come from Lee, Sarasota and DeSoto, with some as far as Hardee County. The only cardiopulmonary services not offered by Medical Center are open- heart surgical procedures and angioplasty, which goes along with open-heart. There are no conditions existing at Medical Center with respect to the lab that would preclude its availability to patients who might be in need of a cardiac cath. Medical Center has an open cardiac cath lab staff. Dr. Rosenfield and Dr., Popper presently do cardiac caths at the hospital but do not perform cardiac caths at any other laboratory in the District now. From March, 1985 through June, 1986, 57 caths were performed at the Medical Center lab. But from January, 1986, through November 1986, 194 caths were performed. Medical Center estimates that they will perform approximately 250 cardiac caths during calendar year 1986, and 486 are projected for calendar year 1987, Medical Center's cardiac cath lab is currently open 8 hours a day, 5 days a week, 52 weeks a year. The maximum capacity for the cath lab is 2,080 procedures a year. It is a shared lab with the hospital special procedures room. The shared procedures have not caused Medical Center to have any scheduling problems with the laboratory yet, but optimal capacity probably is about 1040 caths per year under present conditions. The Medical Center lab is not over-utilized at this point in time. There is no reason why Medical Center could not perform the 650 projected procedures in 1987 for Charlotte and DeSoto counties; 675 for 1988, 694 for 1989, or 727 for 1990. Approval of a new cardiac cath lab at Fawcett would have an adverse economic affect on Medical Center's cardiac cath lab. Medical Center Hospital operates on a fairly tight margin for profitability. There would be potential impact on the level of indigent care offered at Medical Center if its profit margin should decline due to a loss of patients. Medical Center might not give the same amount of indigent care that it would have given otherwise. Medical Center projects, for 1987, to perform 486 procedures at $1,250 charge per procedure. If approximately 21 procedures (4.3 percent of the total) are drawn away from Medical Center in 1987, Medical Center probably would be a minus-loss situation rather than a plus-profit situation. Fawcett's projected market share of the number of the projected caths to be performed in 1987 for Charlotte and DeSoto counties, i.e., 650, would mean that Fawcett would do approximately 260 cases. Charlotte and DeSoto counties are the primary area in which Medical Center receives its cardiac cath referrals. It is probable that Fawcett would capture at least 4.3 percent of the total of referrals from Charlotte and DeSoto Counties since they project a 40 percent market share from the same area. Including the lab at Medical Center, there are seven existing or approved cardiac cath labs within District 8. The labs are accessible in terms of financial availability to individuals such as Medicaid and indigent patients as well as Medicare, insurance, and private pay. They are also geographically located such that access is available throughout the entire District. There was no evidence to suggest that over 10 percent of the District 8 population is two hours away from cardiac cath services. There is sufficient capacity at the existing labs to take on additional patients. No information was provided HRS to indicate that physicians have had patients who were unable to receive services at the existing facilities or that the quality of services within those labs was such that it was detrimental to individuals in need of a cardiac cath within the area. At this time, Medical Center's cath lab, 5 1/2 miles south of Fawcett, is underutilized. There was no evidence that District 8 existing and approved cath labs are over-utilized or that quality of care is suffering from over- utilization. Other Circumstances. The medical population is growing faster in Port Charlotte than in Punta Gorda. Fawcett and St. Joseph's Hospital are located across the street from one another and are the largest facilities in Port Charlotte. Both hospitals together have the ability to draw a large number of patients. Medical Center, on the other hand, is the smallest hospital in the area. Cardiac procedures are rapidly increasing in volume and as the number of cardiac patients in the area increase, Medical Center will be filling more and more of its beds with cardiac patients if it has the only cath lab in the county. However, Medical Center's medical-surgical beds are only 55 percent occupied, and there is ample room at Medical Center to accommodate growth in cardiac caths up to maximum capacity at Medical Center's lab. An indefinite but small number of patients choose not to have cardiac caths that are indicated because the service is not available at Fawcett, their primary care provider. A cath lab at Fawcett would enhance quality of care to those persons, alleviate the trauma of transferring to another hospital, and eliminate duplicate billing occasioned by such transfers. When Fawcett opened, it had a fully equipped intensive care unit that has been upgraded with time so that Fawcett now has a complete non-invasive cardiology program in operation. Fawcett's cardiopulmonary department has grown since the opening of the hospital. When it opened, the hospital only provided basic 12-lead electrocardiograms. Since then Fawcett has added 24-hour holter monitoring, cardiac stress testing and echocardiography, and performs two-dimensional echocardiograms. In addition, the hospital has a peripheral vascular diagnostic lab, and recently has started MUGA testing. Catheterizations are already being performed at Fawcett on a daily basis. Qualified physicians are currently catching every part of the body but the heart, utilizing state of the art procedures and equipment. The provision of cardiac cath is the next logical step in Fawcett's growth and desire to provide a full range of services to its patients. The safety of cardiac cath has been enhanced due to the increased numbers being performed, in that proficiency increases with practice. Accessibility has increased both as to numbers of physicians performing cardiac caths, as well as facilities providing the service. Also, the procedure of angioplasty is increasing in use, and cardiac cath is a prerequisite to angioplasty. Aflgioplasty is a major alternative to cardiac surgery. Fawcett is well-qualified to provide cath lab services with the idea of eventually expanding its cardiac services into other areas of cardiac care, i.e., angioplasty and open heart surgery. The addition of a cath lab at this time is a logical and necessary step toward this goal. At present, Fawcett patients requiring cardiac cath are sent to anther facility providing the service, usually Ft. Myers Community Hospital (FMCH). Fawcett's procedure when transferring a patient is to discharge the patient from the hospital. If it is an emergency situation, he or she would be transferred via the Charlotte County Ambulance Service or by Air Ambulance through an arrangement with that service out of Tampa. A transfer to FMCH could be accomplished by air ambulance in under 30 minutes if the helicopter were based at Fawcett. But the total time from the request for the Tampa-based air ambulance to arrival at FMCH is more than 30 minutes. By ground ambulance, the 31-mile trip from Fawcett to FMCH takes approximately 40 minutes. Transferring a patient in cardiac distress is not without its costs, to the public as well as the patient, the patient's family, and the doctor involved. Every time an ambulance makes that transfer, it is at a cost of several hundred dollars. The patient, the patient's family and perhaps the physician must commute from one facility to the other. Visiting can become a problem because of the travel involved. Transferring a patient also involves a risk to the patient's health because of the trauma of riding in an ambulance. Patients suffer a loss of comfort and continuity of care in having to leave familiar surroundings and familiar doctors. Dr. Collado and other cardiologists in his group, on staff at Fawcett, are unwilling at the present time to transfer patients to Intervenor, Medical Center Hospital (Medical Center), for a cardiac cath because of Medical Center's perceived lack of a proven "track record." These doctors watch a program, see how the program and its physicians perform and how the patients feel about that program, and establish their own relationship with the physician to whom they refer patients, before routinely transferring patients to that physician. Because of this, Dr. Collado presently sends all of his patients to FMCH or Lee Memorial. This is not a minor undertaking. Dr. Collado's group alone refers out at least 100 patients a year in cardiac cath, some years close to 200 patients. Without a cardiac cath lab at Fawcett, considering the medical advances made in the treatment of cardiac disease, it is envisioned that in two or three years, Fawcett will have to transfer more and more patients in order to keep up with common cardiology practices. But more and more of these patients could be transferred to Medical Center, a five to ten minute drive south in Punta Gorda, instead of to Ft. Myers as Medical Center's track record becomes more established. HRS' Policy. Before former Rule 10-5.11(15) [now 10-5.011(1)(e)] was amended, HRS locked applicants into a 1981 use rate. Under this policy, HRS would use the rate at which cardiac caths were performed in 1981 to determine need in the applied-for year. Fawcett's original application, filed in October, 1985, was reviewed and denied under this use rate. Since Fawcett's original review, however, the rule was amended in June 1986. The new rule provides that need is determined using the actual use rate (number of procedures per hundred thousand population) in the service area for the 12-month period beginning 14 months prior to the letter of intent deadline for the batching cycle. Less than two months prior to Fawcett's hearing, HRS' policy was to utilize a planning horizon that was fixed by the application's submittal date. If a formal administrative hearing was held, HRS then applied the need methodology using current population and utilization data available for the most recent 12-month period before hearing. This resulted in the use of more current data than had been used previously or, often, is used now. Three months prior to Fawcett's final hearing, HRS issued three CONs, Nos. 3539, 3964 and 3971, at the same time for the establishment of cardiac cath labs in District 6. One application was filed in October, 1984, targeting the July, 1986, planning horizon, and the other two were filed in April, 1985, for the January, 1987, planning horizon. These applications were initially reviewed under a 1981 "use rate" and denied due to lack of need under the methodology for the given horizon. Subsequently, HRS reconsidered its position on the CONs under the "use rate" as amended in the rule and utilized data from the most recent twelve month period. As a result of this review, 2 cath labs were approved in the same city, Bradenton, and another in Brandon. However, a need for all of these applications also would be shown using a strict interpretation of the current rule, as urged by HRS in this case. In this case, HRS urges a strict interpretation of the rule to lock utilization data regarding district cath labs on the 12-month period beginning 14 months before the letter of intent deadline. But HRS urges looking at current data as of the hearing date in counting approved cath labs. Long Term Financial Feasibility and Quality of Care. Fawcett's proposed project shows a profit by its second year of operation. There will be sufficient utilization of the proposed cardiac cath lab. Projected utilization of Fawcett's cardiac cath lab was derived by first multiplying the projected total population of Charlotte and DeSoto Counties (Fawcett's primary service area) for the first two years the cath lab will operate by the projected 1986 use rate to give the total number of cardiac caths for these counties. Fawcett will capture approximately 40 percent of the Charlotte County and DeSoto County cardiac cath market in its first year of operation, increasing to 50 percent in the second year. Forty percent of the total caths in Year 1 would give Fawcett 274 caths in its first year of operation. Fifty percent of the total caths in Year 2 would give Fawcett 355 total caths in its second year of operation. These projections are reasonable and obtainable. Utilization will surpass 300 procedures per year by the second year of operation, enough caths for its staff to remain proficient, satisfying both Rule 10-5.011(1)(e)'s minimum volume requirement and the sole issue regarding quality of care not already stipulated by the parties. Fawcett's pro forma for the cardiac cath project is based on reasonable and realistic assumptions: The charge per cath is $1,250 for the first year, with an inflation of 5 percent for the second year. This assumption was based upon average charges from area labs. The contractual allowances or the difference in charges and actual reimbursement for Medicare patients are based on the hospital's historical experience for Medicare patients. Uncollectible charges were forecast as 6.2 percent of patient service revenue, based upon historical experience of uncollectible charges (4.9 percent) and an assumption that approximately 2.3 percent of revenues would be service to Medicaid patients. Fawcett does not have a Medicaid provider number and will not be reimbursed for these patients, so these are treated as uncollectible. Salaries and wages were based on area averages of approximately $12.60 an hour for a trained cardiac technician at 2,080 hours a year. Employee benefits were based on the hospital's current budget of approximately 19.7 percent of salaries and wages for employee benefits. The assumption for supplies and other expenses was based on discussions with the people at the hospital and FMCH's experience. e. Repairs and maintenance depreciation assumes an eight year life on the equipment and an equipment purchase price of $90,230. g. Federal and state income tax assures an overall corporate rate for Basic American Medical, Inc. of 34 percent for federal tax, and 5 1/2 percent for State tax. Based on these assumptions, the proposed cath lab is financially feasible, with a projected net income of nearly $35,000 the first year, and $65,000 the second year. These numbers reflect the relatively low fixed cost involved in the project. In fact, Fawcett's break-even point is less than 140 cardiac caths per year. Indigent Care. Fawcett is willing to condition its CON on the provision of 5 percent care to indigent patients. But Fawcett does not have a Medicaid provider number and its commitment to provide indigent care is suspect. Currently, 4 percent of Fawcett's patients are non-paying, this includes charity indigent care and bad debt. According to HCCS data, Fawcett did no Medicaid and its deductions from revenue for charity work was only one-tenth of one percent in 1985. Without a Medicaid provider number, Fawcett would be writing off approximately $7,500 in Medicaid revenue if it provided 2.3 percent care to Medicaid patients. This is additional financial disincentive from meeting or exceeding its projected Medicaid service. As stated in its application, Fawcett's proposed policy for its cath lab will be to treat Medicaid patients in need of the service, regardless of ability to pay. But actual Medicaid care provided under the policy is dependent upon the actual number of Medicaid patients Fawcett's doctors refer for cardiac cath.
Recommendation Based on the foregoing Findings Of Fact and Conclusions Of Law, it is recommended that Respondent, Department of Health and Rehabilitative Services, deny the application of Petitioner, Fawcett Memorial Hospital, for certificate of need to establish an adult cardiac catheterization lab, CON Action NO. 4313. RECOMMENDED this 6th of April, 1987 in Tallahassee, Florida. J. LAWRENCE JOHNSTON Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 6th day of April, 1987.
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, as well as the parties' stipulations of fact, the following relevant facts are found: The petitioner RHPC, Inc., d/b/a Riverside Hospital (Riverside) is licensed to operate a 102-bed general, acute care hospital located in New Port Richey, Pasco County. Formerly a public hospital known as West Pasco Hospital, Riverside was acquired by American Healthcare Management, Inc. (AHM) of Dallas, Texas, in December of 1983. By the prior issuance of Certificate of Need (CON) Number 2859, Riverside was authorized to construct and equip a new hospital building for patients and ancillary services at a cost of $14.8 million, including a special procedures room. The new building was approved for occupancy and use as a hospital in September of 1986. Riverside was able to complete construction and equipping of its new facility for an amount approximately $2.5 million less than the approved capital expenditure budget for CON No. 2859. Riverside now seeks to upgrade the existing equipment in its special procedures room so as to be capable of performing cardiac catheterization procedures. The room would not be a dedicated cardiac catheterization laboratory, but would serve the dual function of both cardiac catheterization and non-cardiac angiography. While the cost of creating a brand new cardiac catheterization laboratory would normally amount to approximately $1.4 million, petitioner proposes an expenditure of only $512,474. This lower figure results from the fact that Riverside's existing special procedures room was equipped during the renovation and reconstruction authorized pursuant to Certificate of Need Number 2859, and now needs only to be upgraded to achieve cardiac catheterization capacity. In 1982, prior to its acquisition by AHM, Riverside lost its accreditation through the Joint Commission on Accreditation of Hospitals (JCAH). The removal of accreditation was occasioned by code and physical plant deficiencies and documentation deficiencies related to quality assurance, infection control, medical record-keeping and staff credentialling. Riverside has attempted to eliminate all such deficiencies which led to the prior loss of accreditation. In September of 1986, Riverside submitted its application for a JCAH accreditation survey of its facility. As of the dates of the administrative hearing, the survey dates had not yet been scheduled. It generally takes JCAH approximately so days after a survey to render its accreditation decision. Riverside does not intend to offer cardiac catheterization services until JCAH accreditation is received by the hospital, and is willing to condition its proposed Certificate of Need upon receipt of such accreditation. Riverside has been certified by HRS for Medicaid/Medicare participation. While those conditions of participation are similar to JCAH accreditation standards, they are not identical. Riverside's active medical staff includes six board- certified or board-eligible cardiologists, none of whom currently perform cardiac catheterizations. There are no cardiovascular surgeons on staff, and Riverside does not immediately intend to offer open heart surgery at its facility. Approximately nine local cardiologists in Pasco County, including those on the medical staff of Riverside, have formed a corporation to promote and implement a quality assurance program for the catheterization laboratory at Riverside and to recruit and hire a board-certified cardiologist to perform the catheterizations. No specific physician has yet been recruited as catheteer. Riverside currently has on its staff certified critical care registered nurses and registered nurses with advanced cardiac life support (ACLS) training. It also has radiological support staff, staff trained-in photographic processing and staff available to handle blood samples and observe and monitor patients. It is expected that there will be cross-training at other AHM facilities having cardiac catheterization laboratories, such as St. Luke's Hospital in San Antonio, Texas. In addition to the cardiologists, Riverside intends to staff the proposed laboratory with one registered nurse, one radiology technician, a scrub technician and a technician responsible for the operation of the physiological monitoring during a procedure. The former two positions will be hired exclusively for the cardiac catheterization laboratory, and the latter two are already on the staff and will be assigned for catheterization procedures. Riverside currently offers the following noninvasive cardiac/circulatory diagnostic services: hematology studies, coagulation studies, electrocardiography (EKG), chest x-rays, blood gas studies, clinical pathology studies, blood chemistry analysis, nuclear studies pertaining to cardiology, echocardiography, pulmonary function testing and microbiology studies. Riverside proposes to upgrade its existing General Electric angiographic system with a new General Electric multi- purpose diagnostic system, and will also purchase a physiological monitor. A maintenance agreement will be purchased under which General Electric, which maintains an office in Tampa, will be responsible for maintaining the equipment. It is anticipated that a GE service technician will be on call, if not on site, during all cardiac catheterization procedures. GE also provides in-service training in the use of its equipment, and it is anticipated that GE training personnel will remain on site during the first several times the equipment is operated. Funds for the proposed cardiac catheterization laboratory are available through the prior financing arranged by AHM for the hospital reconstruction and renovation authorized by Certificate of Need No. 2859. Assuming that the proposed lab will perform 219 catheterization procedures at an average charge of $1,794 during the first year of operation, and 417 procedures at an average charge of $1,884 during the second year, Riverside projects a net income of $20,593 for year one and $117,288 for year two. The proposed charges are comparable to those of existing providers. The pro formas assume a payor mix of approximately 15 percent Medicare patients. Inasmuch as a large majority of patients requiring cardiac catheterization are elderly, the Medicare patient mix projections are probably low. Since Medicare does not generally fully reimburse a hospital for its actual charges, the net income projections are likely overstated. The pro formas do not include any expenses associated with a helicopter ambulance service. The expenses projected for employee benefits, seventeen percent of salary, appear to be a little low for the Pasco County area. Riverside anticipates that the net income generated from the proposed catheterization lab will also help offset and reduce the overall losses experienced by it in the past several years. HRS District V includes Pasco and Pinellas Counties. Although the HRS methodology for determining the numeric need for cardiac catheterization laboratories indicates, no additional need in District V, the parties have stipulated and the evidence demonstrates that there is a need for such a lab in Pasco County. The five existing catheterization laboratories in District V are all located in Pinellas County. There are currently no existing or approved labs in Pasco County, and approximately 1,200 Pasco County residents per year are being sent out of Pasco County for cardiac catheterization, mostly to Tampa General Hospital in District VI. The physicians who testified at the hearing would prefer to perform cardiac catheterization procedures and send their catheterization patients to a facility which also has open heart surgery capacity. When open heart surgery is necessary and a patient is referred or transferred to another hospital for such surgery, that facility often performs its own cardiac catheterization procedures. This results-in duplicate costs, services and potential risk to the patient who is cashed in one facility and referred to another facility for surgery. It has been the experience of local cardiologists in Pasco County that between 50% and 70% of patients upon whom a catheterization procedure is performed ultimately also have open heart surgery. Nevertheless, each of the cardiologists who testified indicated his desire and willingness to utilize Riverside's proposed laboratory for low-risk diagnostic cardiac catheterization procedures. Until Riverside is able to offer open heart surgery services at its facility (which is within Riverside's long-range plan)' it proposes to screen patients for risk, and perform only elective, diagnostic catheterization procedures. Neither pediatric, emergency nor therapeutic catheterization, such as balloon angioplasty, will be performed in Riverside's proposed cardiac cath lab. Three hospitals offering open heart surgery have entered into formal transfer agreements with Riverside. These include Morton F. Plant Hospital in Clearwater, Bayfront Medical Center in St. Petersburg, and Tampa General Hospital in Tampa. None of the three are within thirty minutes driving time from Riverside by emergency vehicle. Morton F. Plant' the closest of the three, is 27 miles from Riverside. During a "red run" or "hot run" with sirens and lights flashing, and following normal emergency driving procedures, it would take between 45 and 50 minutes for an ambulance to travel between Riverside and Morton F. Plant Hospital. There are large traffic volumes which utilize the road systems between Riverside and Morton F. Plant Hospitals, and a great number of lighted intersections. While petitioner presented testimony that an emergency vehicle traveling 10 miles per hour over the speed limit could reach Morton F. Plant from Riverside in 30 minutes, 18 seconds, such testimony is not deemed credible. The witness had not actually traveled that distance in an emergency vehicle. An actual emergency run was made from Tarpon Springs General Hospital to Morton F. Plant Hospital a distance of about 15 miles. That run, travelling a portion of the same route proposed by Riverside's witness, took about 22 minutes. Given the fact that Riverside is some 10 to 12 miles further away from Morton F. Plant Hospital than is Tarpon Springs General Hospital, it is concluded that an ambulance could not travel the 27 miles from Riverside to Morton F. Plant Hospital in 30 minutes in average travel conditions. Riverside does have a helipad at its facility, but does not own a helicopter and does not have a contract for air ambulance services. Although one of Riverside's witnesses believed that a helicopter would be at Riverside on all days upon which cardiac catheterizations are performed, no expenses for a helicopter or a contract with a helicopter ambulance service are included within Riverside's pro forma. Riverside intends to offer cardiac catheterization services 24 hours a day, seven days a week. While patients are generally directly charged for the actual costs associated with emergency transport, it is not reasonable to assume that the costs of either purchasing or maintaining an on-site helicopter could legitimately be directly charged to patients. The actual flight time from ground takeoff at Riverside to ground landing at Tampa General Hospital in average travel conditions is 15 minutes. There is a licensed air ambulance service, known as Suncoast, which operates out of Tampa International Airport and maintains two helicopters. Unless a hospital has a contract for air ambulance services, Suncoast does not dedicate a helicopter to be on standby and ready to respond to a call for an emergency flight. Even if a helicopter were available, it would take between 30 to 45 minutes to place a helicopter on the ground at Riverside after the need has been communicated to Suncoast. Given the fact that Riverside does not own or maintain a helicopter on site, it is reasonable to consider the time which could be expected to lapse between the summons for an emergency transport vehicle and its arrival, as well as the time of transport between two hospital facilities. Emergency runs, whether by ground ambulance or air transport, are tremendously stressful on a patient. This factor becomes particularly important when the patient is one who has recently undergone a cardiac catheterization procedure and is being transported for emergency open heart surgery. Even when patients are screened for risk, complications can arise during a diagnostic cardiac catheterization procedure necessitating an immediate transfer of the patient to open heart surgery or, in some events, a therapeutic catheterization procedure. Such complications include a possible artery dissection during insertion of the catheter or the occurrence of an eschemic episode as a result of the displacement of oxygenated blood with the dye injected into the coronary arteries. While these events are rare, occurring in possibly only 1% of all diagnostic procedures, they do necessitate immediate, more advanced treatment. The 1985-87 Florida State Health Plan favors co-located cardiac catheterization laboratories and open heart surgery programs in the same facility. Quoting from the Inter-Society Commission on Heart Disease Resources, the State Health Plan notes: ". . . there can be little justification for the development of these highly specialized facilities (cash labs) unless expertise in cardiology, cardiovascular radiology, and cardiovascular surgery are immediately available. Optimally therefore, catheterization laboratories should be located only in institutions with well organized and closely related programs of cardiovascular surgery. ". . . such an arrangement not only facilitates close interdisciplinary cooperation and minimizes unnecessary, repetitive, inadequate, or unsafe diagnostic studies, but it also allows prompt intervention should life threatening complications develop during catheterization studies . . . It should be emphasized . . . that separation of the diagnostic laboratory from the surgical facility is less than optimal and may present serious problems." (Riverside Exhibit 5, Volume II, pages 95-96). The State Plan recognizes that some within the medical community feel that independent, "satellite" labs can perform studies as adequately as labs associated with open heart surgery programs. However, it also recognizes the literature demonstrating that such independent labs usually have lower utilization rates. The District v Health Plan does not stress co-location, but suggests that cath labs be developed in areas which have the potential of justifying open heart surgery capability within three years. Other than considerations of timely access, there was no evidence that an additional open heart surgery facility is needed in District V or specifically, in Pasco County. The District Health Plan does stress the provision of services to the indigent. Riverside is committed to serving all patients regardless of ability to pay. Bayonet Point Hospital is a 200-bed hospital located in Hudson, also in Pasco County. In an earlier batching cycle, Bayonet Point applied for a Certificate of Need to add both a cardiac catheterization laboratory and open heart surgery at its Hudson facility. After an administrative hearing, it was recommended that the application be granted. (Division of Administrative Hearings Case No. 85-3569) The Department of Health and Rehabilitative Services rejected that recommendation by Final Order filed on August 22, 1986, and the matter is currently on appeal to the District Court of Appeal, First District. If Bayonet Point were to offer cardiac catheterization services at its facility in Hudson, a cardiac cath lab at Riverside would have an adverse impact upon Bayonet Point's program.
Recommendation Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that Riverside's application for a Certificate of Need to equip and operate a cardiac catheterization laboratory at its hospital in New Port Richey be DENIED. Respectfully submitted and entered this 19th day of March, 1987, in Tallahassee, Florida. DIANE D. TREMOR, Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway Tallahassee, Florida 32399 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 19th day of March, 1987. COPIES FURNISHED: Leonard A. Carson, Esq. and Robert P. Daniti, Esq. Carson & Linn, P.A. 1711-D Mahan Drive Tallahassee, Florida 32308 Darrell White, Esq. Assistant General Counsel Department of Health and Rehabilitative Services 1323 Winewood Blvd. Building 1, Room 407 Tallahassee, Florida 32399-0700 Thomas M. Beason, Esq. and Donna H. Stinson, Esq. Moyle, Flanagan, Katz, Fitzgerald & Sheehan 118 North Gadsden Street Tallahassee, Florida 32301 Gregory L. Coler, Secretary Department of HRS 1323 Winewood Blvd. Tallahassee, Florida 32399-0700 Sam Power, Clerk Department of HRS 1323 Winewood Blvd. Tallahassee, Florida 32399-0700 APPENDIX The proposed findings of fact submitted by the petitioner, respondent and intervenor have been fully considered and have been accepted and/or incorporated in this Recommended Order, except as noted below. Petitioner 16. First sentence rejected as contrary to the evidence. 27. Last sentence rejected insofar as it contemplates the reasonableness of the pro forma with regard to the Medicare patient mix and the failure to include expenses relating to an air ambulance. 38,39. Rejected. Failure to account for a proper payor mix and air ambulance service renders the financial feasibility projections unreliable. Rejected. Only the JCAH can render such a factual finding. Last sentence rejected as unsupported by the record of this proceeding. See Order denying second motion to reopen record. Rejected as to travel time. Not supported by competent, substantial evidence. Accepted only insofar as it pertains to actual patient flight time. Rejected as not supported by competent, substantial evidence. Second sentence rejected as speculative. Last sentence rejected as unsupported by competent, substantial evidence, although it is recognized that Riverside intends to offer only diagnostic procedures. Last sentence rejected as an absolute statement of fact. Not supported by competent, substantial evidence. 64. Second sentence partially rejected as contradicted by competent, substantial evidence. See Finding of Fact 10 in this Recommended Order. Respondent HRS 20. Rejected insofar as it applies to all ambulance drivers. Not supported by competent, substantial evidence. Intervenor Bayonet Point 5. Rejected as irrelevant and immaterial. Fourth sentence is rejected as not supported by competent substantial evidence. Third sentence partially rejected. See Finding of Fact Number 11. 16. While accepted as an accurate statement of fact, it is concluded that such considerations should not be included within the 30 minute travel time rule. 17,18. Rejected as irrelevant and immaterial to the issues in dispute. First sentence accepted as factually correct but not determinative of the reasonableness of the pro formas. First sentence accepted as factually correct but not determinative of the reasonableness of the pro formas. 22,23. Partially rejected as speculative and unsupported by competent, substantial evidence. Rejected as an improper finding of fact, as opposed to a conclusion of law after considering the factual circumstances. Accepted only if the words "if approved" are added.
Findings Of Fact Petitioner, Mease Health Care, Inc. (Mease), is a private, not-for- profit acute care community hospital in Dunedin, Florida. It is located in District V, a health planning district established by respondent, Department of Health and Rehabilitative Services (HRS). Intervenors, Morton F. Plant Hospital, Inc. (Plant) and Bayfront Medical Center, Inc. (Bayfront), are acute care hospitals also located within District V. Mease has pending in Case Nos. 89-1652 and 89-4888 a challenge to HRS's fixed need pool determination for new cardiac catherization services and an application for a certificate of need (CON) authorizing it to establish a new inpatient cardiac catherization program in Dunedin, Florida. In the instant case, Mease has challenged an HRS policy as being an illicit rule. Respondent is the state agency responsible for the administration of the Health Facility and Services Development Act. For the purpose of assisting it in administering the act, HRS has promulgated Rule 10-5.011(1)(e), Florida administrative Code (1989), which pertains to inpatient cardiac catherization services and defines the requirements for the establishment of such services. Paragraph 8.c. of the rule contains the formula used for calculating fixed need pools for new inpatient cardiac catherization programs. The formula is: NN PCCPV - ACCPV - APP, where NN is the annual net program volume need, PCCPV is the projected adult cardiac catherization program volume, ACCPV is the actual adult cardiac catherization volume, and APP is the projected program volume for approved programs. This formula was applied by HRS to the September 1988 batching cycle, which was the first batching cycle after the rule became effective. For that cycle, HRS calculated NN to be -53 for District V. NN was therefore less than 300. Paragraph 8.d. of the rule provides the following relevant instructions on how the formula should be applied to batching cycles subsequent to September 1988: If NN is less than 300 in the first batching cycle after the rule becomes effective, the ACCPV value which is subtracted from the PCCPV will be the same value as ACCPV in the first batching cycle until the projected net need in a future batching cycle reaches a program volume of 300 or more. . . For the March and September 1989 batching cycles, which were the two batching cycles immediately subsequent to the first batching cycle after the rule became effective, HRS did not keep the ACCPV value constant, "or the same . . . as in the first batching cycle", even though NN was "less than 300 in the first batching cycle." Put another way, in all batching cycles after September 1988 HRS has recalculated ACCPV even though in the first batching cycle NN was a negative number and therefore was less than 300. HRS's affidavit confirms that this is the manner in which ACCPV has been calculated in all cases since the adoption of the rule. Since the policy has been consistently used in the above manner in all cases, creates rights and requires compliance, and is not apparent from a literal reading of the rule, the policy necessarily constitutes a rule. There is no dispute that the policy has not been formally adopted as a rule.
The Issue The issue for determination is whether Petitioner should be awarded a certificate of need authorizing the establishment of cardiac catheterization laboratory services at its facility in Port Charlotte, Florida. As a result of stipulations of the parties presented at hearing, matters for consideration were limited to whether Petitioner meets the criteria of availability of funds for capital expenditures for the project in accordance with Section 381.705(1)(h), Florida Statutes; and whether Petitioner has shown the existence of need for additional services by any existing medically underserved groups in the service area.
Findings Of Fact The parties have stipulated that Petitioner does not meet the criteria of Section 381.705(1)(a), Florida Statutes, because there is no numeric need for the program established by any agency rule formula and that no emergency or other not normal circumstances exist, including problems of geographic, financial or programmatic access, justifying the program in the absence of such enumerated need. Petitioner's agreement to this stipulation was conditioned upon an assumption that previous Certificates of Need, formerly granted by final orders of Respondent to other entities in previous batching cycles and now the subject of legal appeals by Petitioner in the appellate court, will eventually be confirmed by that court to have been properly issued. The parties have stipulated that Petitioner, as the result of nonexistence of numeric or nonnumeric need, has not met criteria regarding its ability to provide quality care, a requirement of subparagraph (c) of Section 381.705(1), Florida Statutes; has not met criteria regarding availability and adequacy of other health care facilities in the applicant's service district, a review component set forth in Section 381.705(1)(d), Florida Statutes; has not met criteria regarding immediate and long term financial feasibility of Petitioner's proposal, a requirement of Section 381.705(1)(i), Florida Statutes; has not met criteria regarding the impact of the proposed project on the costs of providing such health services, a requirement of Section 381.705(1)(l), Florida Statutes; and has not met criteria, as required by Section 381.705(2)(a)-(d), Florida Statutes, regarding alternative services, efficiency of existing services, alternatives to new construction or the likelihood of patients obtaining the proposed service in the absence of Petitioner's proposal. The parties have stipulated that review requirements of subparagraphs (e), (f), (g), (j), and (k) of Section 381.705(1), Florida Statutes, are found not to be applicable to this proceeding. Those subparagraphs relate, respectively, to economics of shared services, need for special services, need for research and educational facilities, special needs of health maintenance organizations and needs of entities serving residents outside the service area. The parties have stipulated that the criteria ofSection 381.705(1)(b), Florida Statutes, has not been met because they were not addressed or challenged by Petitioner. However, Petitioner does contest the accessibility by medically underserved groups of existing and approved providers in the service district. With the exception of the availability of funds for capital and operating expenditures related to the project in Petitioner's application and the extent to which the proposed services will be accessible to all residents of the service district, further stipulation between the parties also establishes that the review criteria contained in Section 381.705(1)(h), Florida Statutes, does not apply to this proceeding. Portions of Rule 10-5.011(b), Florida Administrative Code, relating to accessibility of services to residents of the service district are also excepted from consideration in this proceeding by the parties' stipulation. By stipulation of the parties, it is established that the review requirement of Section 381.705(1)(l), Florida Statutes, relating to the probable impact of the proposed project on the cost of providing services proposed by Petitioner, is met. The parties' stipulation further establishes that requirements of Section 381.705(1)(m) and Section 381.705(1)(n), Florida Statutes, have been met. These statutory subparagraphs relate, respectively, to methods and costs of proposed construction, and Petitioner's past and proposed provision of health care services to medicaid and medically indigent patients. Petitioner is a separate, albeit subsidiary,corporation from its parent, Bon Secours Health Systems, Inc., (Bon Secours) a "not for profit" corporation based in Marriottsville, Maryland. Approximately 80 percent of the total project cost of $1,450,000 cost is expected to come from the parent organization and not Petitioner's corporation. The project has been approved by Petitioner's corporation and management approval has been granted by Bon Secours, subject only to final board approval and reevaluation by the parent corporation on an annual basis until the actual capital expenditure is incurred. Petitioner's parent corporation uses either a line of credit or goes to the tax exempt bond market to meet capital expenditure needs. The bond market is utilized when capital needs exceed $15 million for the year. Whether the funding source for Petitioner's project would come from a line of credit or bond financing would not be known until the actual year in which the expenditure is incurred. Bon Secours includes Petitioner in its obligated group which consists of a system-wide master trust indenture established in 1985. The group consists of eight hospitals and three long term care facilities. Weaker entities in the group have the benefit of the credit strength of the group's entire system. In this regard, Bon Secours enjoys a Standard & Poors and Moodys' bond rating of A+ and A-1, respectively. The corporation is a good credit risk with a strong financial position and good earnings record. Over the next five years, Bon Secours has the ability to raise in excess of $100,000,000 in the bond market for funding purposes, inclusive of the project which is the subject of theseproceedings. Although final approval of Petitioner's project by Bon Secours' board of directors is expected shortly, that approval had not occurred at the time of final hearing. As a result, the proof fails to establish that Bon Secours is committed to provide financing for Petitioner's project. Petitioner presented expert testimony regarding accessibility by medically underserved groups to Petitioner's and other cardiac catheterization programs. Petitioner's expert placed the size of the medically indigent population, a subcategory of the medically underserved group, at six to seven percent of the total population of the service area. Due to the lack of specificity of the methodology used in arriving at the cited percentage figure, no credibility can be ascribed to that population percentage. However, both Respondent and Petitioner concede the existence of this group in the district service area sought to be served by Petitioner's project. Petitioner has not established whether the medically indigent population is denied access to cardiac catheterization programs within the district service area. While Petitioner's hospital is a medicaid provider with a proactive policy of aiding the medically indigent, the availability of cardiac catheterization services exist for this group at Intervenor's medical center facilities, located only five miles from Petitioner's hospital. Intervenor is also a medicaid provider. The proof fails to establish that medicaid patients or medically indigentpatients are presently denied or turned away from Intervenor's facility. Further, the duplication of such services at Petitioner's hospital could effectively reduce the number of cardiac catheterization procedures required for the medical staff of Intervenor's laboratory to maintain proficiency. In point of fact, there is unused cardiac catheterization capacity at Intervenor's facility. As established by Intervenor's exhibit number one, there were 562 cardiac catheterization procedures performed at Intervenor's facility in 1988. The State Health Plan recites a minimum goal of 600 such procedures a year as a proficiency measurement; the Local Health Plan maintains that a minimum of 300 procedures should be performed to insure proficiency.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that a Final Order be entered denying Petitioner's application for approval of a cardiac catheterization Certificate of Need. DONE AND ENTERED this 29th day of June, 1989, in Tallahassee, Leon County, Florida. DON W.DAVIS Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Fl 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 29th day of June, 1989. APPENDIX The following constitutes my specific rulings, in accordance with Section 120.59, Florida Statutes, on findings of fact submitted by the parties. Petitioner's Proposed Findings. 1.-3. Adopted in substance, except that part (l) of proposed finding 3 was met by Petitioner. 4.-5. Addressed in part. To the extent that the last sentence of proposed finding 5 suggests the establishment of final approval by the parent corporation, it is rejected. 6. Accepted with the exception of approval by the parent corporation. The record supports a finding of approval by management of that corporation, but not the board of directors. 7.-8. Adopted in substance. Adopted in part, remainder rejected due to witness's inability to support her calculations as to percentages of the population within the service district classified as medically indigent. Addressed in part, remainder unnecessary to conclusion. Addressed in part, remainder rejected on basis of relevancy. Addressed. Rejected on basis of relevancy. Addressed in part, remainder rejected as argumentative and speculative. Respondent's Proposed Findings. 1.-2. Rejected. Treated in preliminary discussion. 3.-21. Adopted in substance. 22.-23. Adopted by reference. 24.-25. Addressed in substance. 26.-30. Adopted by reference. 31.-33. Adopted by reference. Intervenor's Proposed Findings. 1.-3. Adopted in substance. 4. Rejected as unnecessary. 5.-9. Adopted in substance. 10. Adopted by reference. 11.-12. Adopted in substance. COPIES FURNISHED: Joseph R. Buchanan, Esq. Suite 900, Sun Bank Building 777 Brickell Avenue Miami, FL 33131 Edgar Lee Elzie, Jr., Esq. 215 South Monroe Street, Suite 804 Tallahassee, FL 32301 E. G. Boone, Esq. 1001 Avenida del Circo Venice, FL 34284 Gregory L. Coler Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, FL 32399-0700 Sam Power Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, FL 32399-0700 John Miller, Esq. General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, FL 32399-0700
The Issue The issues in this case are whether Respondent: failed to keep proper medical records; (2) committed medical malpractice; or (3) knowingly performed professional responsibilities which he knew he was not competent to perform, as set forth in the Administrative Complaint, and if so, what is the appropriate sanction.
Findings Of Fact The Department is the state agency charged with regulating the practice of medicine pursuant to section 20.43, chapter 456, and chapter 458, Florida Statutes (2014). At all times material to the complaint, Dr. Rivera-Kolb was a licensed medical doctor within the state of Florida, having been issued license number ME 40201. Events of June 25, 2008 On June 25, 2008, Patient J.D., a 43-year-old female, was scheduled for multiple procedures at Florida Atlantic Orthopedics ("the facility"). The procedures included a two- level discogram by Dr. Thomas Rodenberg, followed by a two-level lumbar discectomy by Dr. Roberto Moya, followed by a bilateral L3 to S1 facet radiofrequency lesioning by Dr. Rodenberg. On June 25, 2008, Dr. Rivera-Kolb was working at the facility. As he testified, he had been hired to "harvest information" in personal injury cases such as slip and falls or automobile accidents. He would routinely perform physical examinations, develop full medical histories, and "proceed to follow a certain pattern of doing x-rays, doing certain tests at different agreed times, to comply with regulations imposed on the PI industry." Dr. Rivera-Kolb would also render primary health care and provide patients with anti-inflammatories and muscle relaxants as necessary. As indicated by a "Pre-Op" form dated June 25, 2008, and signed with the name "L. Lerfald, R.N." in the "Signature of Nurse" block, on that morning Nurse Lerfald took various vital signs of J.D. and recorded them at 10:50 a.m. At that time, J.D. was given 8 mg of hydromorphone and 20 mg of Valium. Dr. Rodenberg, an anesthesiologist at the facility, placed a central intravenous line ("IV") in J.D.'s left jugular. Dr. Rivera-Kolb assumed the responsibility of monitoring J.D. and preparing an "Anesthesia Record" during the two-level discogram procedure that was to be performed first. J.D. had been a patient of Dr. Rivera-Kolb's in the weeks before the procedures, and he was aware that she had accelerated hypertension (very high blood pressure). Dr. Rivera-Kolb sat at the head of the operating table, monitored J.D.'s vital signs, and filled out the Anesthesia Record, while Dr. Rodenberg performed the discogram. Dr. Rivera-Kolb then left the operating room. The second procedure, the two-level lumbar discectomy, was performed by Dr. Moya, with Dr. Rodenberg as anesthesiologist. Dr. Rivera-Kolb returned to the operating room after the discectomy and resumed the responsibility of monitoring J.D. for the third procedure, the facet radiofrequency lesioning, which was performed by Dr. Rodenberg. When Patient J.D. was ready to be moved from the operating room to the Post Anesthesia Care Unit ("PACU"), she became unresponsive, with an oxygen saturation of 60 percent and a heart rate of 30. Dr. Rivera-Kolb was the only physician present with the operating room staff when these changes occurred. In a written statement he later submitted to Mr. Robert Yastremzki, medical investigator at the Department of Health, Dr. Rivera-Kolb wrote: She was lying prone on the OR table. The moment she was overturned to a supine position on the gurney, the oxygen saturation alarm went off. There was an abrupt drop in blood pressure and pulse. The OR staff and I made sure all connections were in place. When it was corroborated that all connections were intact, I summoned Dr. Rodenberg to the OR as I reached for ventilation mask to improve oxygen delivery. The symptoms she displayed were consistent with a vasovagal syndrome secondary to local anesthetics injected in the cervical area during the procedure, which is not an uncommon complication. The parties stipulated that Patient J.D. went into full cardiac arrest, and Dr. Rodenberg was emergently called back to the operating room. Dr. Rodenberg arrived almost immediately. J.D. received cardiopulmonary resuscitation ("CPR"), atropine by IV, and a laryngeal mask airway ("LMA"). The left jugular IV appeared to be infiltrated, so Dr. Rodenberg placed a new external jugular line on the right side. After J.D.'s vital signs were stabilized, Dr. Rodenberg replaced the LMA with an orotracheal tube. J.D. was now breathing spontaneously and saturating in the high 90's, and Dr. Rodenberg directed that she be moved to the PACU. Dr. Rivera-Kolb and Nurse Lerfald moved J.D. to the PACU. Once there, her head was elevated. Shortly thereafter, Nurse Lerfald noticed that the left side of J.D.'s face was beginning to swell. Dr. Rodenberg was called back again. When Dr. Rodenberg arrived in the PACU a minute later, J.D.'s face was completely swollen. Dr. Rodenberg assumed control of J.D.'s care. He concluded that the swelling was angioedema and felt that anaphylactic shock was imminent. He detected a faint pulse and directed that the patient be returned to the operating room, where she was placed on a ventilator. A few moments later, no pulse was present, and CPR was begun a second time. J.D. was given epinephrine and atropine, and "911" was called. Dr. Moya was called in to assist. When Dr. Moya arrived, he concluded that the subcutaneous emphysema was secondary to the IV lines in J.D.'s jugulars and that J.D. had bilateral apical pneumothorax. He immediately placed chest tubes, first into the right side, and then the left. When the right chest tube was placed in water to create a negative pressure, clear fluid and gas came out. When the left chest tube was done, white milky fluid and gas were discharged. The Boca Fire and Rescue arrived and resuscitation efforts continued for approximately 25 minutes, after which blood pressure and heart rate were restored. J.D. was then transported to Boca Community Hospital. Pharmacy bills reflect that both midazolam (Versed) and propofol were signed out for use in Patient J.D.'s procedures on June 25, 2008. Dr. Rivera-Kolb signed the Anesthesia Record for the discogram procedure.1/ It indicated that the anesthesia and surgery started at 11:25 a.m. and ended at 11:55 a.m. Under a section entitled "Technique," the form provided check blocks to choose the anesthesia that was used: "General"; "Epidural"; "Spinal"; "Axillary Blk"; or "Other." The block on the form next to "Other" was checked, followed by the hand-written notation "MAC local." The form reflects oxygen saturation levels of 95 and 96 for two consecutive 15-minute periods. It records other readings every five minutes. It indicates systolic blood pressure at levels of 160 and 170 and diastolic blood pressure ranging from 90 to 110. It records a respiration rate of between 10 and 20 and a heart rate between 80 and 90. It does not indicate what, if any, drugs were administered during the procedure. It does not indicate any temperature readings, breath sounds, or EKG readings. Dr. Rivera-Kolb signed his name on the Anesthesia Charge Sheet on the line labeled "Anesthesiologist 1."2/ This sheet indicates that Dr. Rodenberg was the "Surgeon/Referring MD." It shows Current Procedural Terminology (CPT) codes of "66290 x2," indicating two "lumbar discograms," and "77003," indicating "flouroscopic guided--spine." In the row marked "ASA Physical Modifiers," the notation "P3" is circled. The sheet indicates the procedure was to be conducted with "MAC" anesthesia. It indicates that the pre-op interview was begun at 11:05 a.m. and ended at 11:12 a.m., that the surgery started at 11:20 a.m. and ended at 12:00 p.m., and that anesthesia also started at 11:20 a.m. and ended at 12:00 p.m. Dr. Rodenberg prepared and signed two different Anesthesia Records. Each recorded information for both the discectomy and facet radiofrequency lesioning procedures, even though Dr. Rodenberg performed the facet lesioning procedure himself and so could not appropriately also have performed the duties of anesthesiologist for that procedure.3/ Each of these forms indicates that the surgeries started at 12:04 p.m. and ended at 13:14 p.m., that the patient was in the PACU at 13:20 p.m., and that anesthesia started at 12:01 p.m. and ended at 13:24 p.m. There are differences in the two forms, however. In the section entitled "Technique," the first form has "MAC" written in next to the "Other" block, while the second form has "MAC local" written in this space.4/ In addition to the drugs shown as administered on the first form, the second form also shows the administration of what appears to read "Depo Medrol" and "epinephrine." Neither form documents the administration of either midazolam or propofol. Neither form records any patient temperature readings or breath sounds. While the first form records the last reading of blood pressure and heart rate at 13:15 p.m., the second form shows additional readings taken at 13:20 p.m., which reflect a considerable drop in heart rate to 40, a drop in systolic blood pressure to 75, and a drop in diastolic blood pressure to 20. The second form also contains hand-written notations in the "Remarks" area of the form which appear to read "postop instability," "See Nursing Notes," "See separate dictation(s)," "1324," and "intubated to PACU SR->sat 96%." In the "Post Op Visit" area of the second form a box marked "Complications" is also checked. A hand-written note in J.D.'s file reads as follows: Dr[.] Noback Escobar wanted me to leave this for you. The record was corrected after the fact due to disconnected IV so there might be two slightly different versions. You may call if this is confusing in any way Dr. Rodenberg Assuming that this note was made with respect to the two different Anesthesia Records, it does not provide an adequate explanation of all of the differences in the forms. Most significantly, the second form includes notations at 13:20 p.m. reflecting significant changes in J.D.'s blood pressure and heart rate, and reference to her post-operative instability and complications. These differences would not be explained by a disconnected IV, and the note does not otherwise explain them. There is, however, only one Anesthesia Record prepared and signed by Dr. Rivera-Kolb in J.D.'s medical records. Dr. Rivera-Kolb testified repeatedly at hearing that this form pertained to the third procedure, that is, the facet radiofrequency lesioning.5/ Dr. Rivera-Kolb's testimony on this point is rejected as not credible. The times indicated on the Anesthesia Record he signed are those of the first procedure, the two-level discogram, and are consistent with the time of the pre- operation procedures as documented on the form signed by Nurse Lerfald, with the Anesthesia Charge Sheet also signed by Dr. Rivera-Kolb, and with the times indicated on the Anesthesia Records prepared by Dr. Rodenberg for the second and third procedures. While Dr. Rivera-Kolb insisted that he prepared and kept an Anesthesia Record for the facet radiofrequency lesioning, he offered differing accounts with respect to that form. Dr. Rivera-Kolb's written statement to the medical investigator notes that J.D. was finally stabilized and sent to the hospital, and then continues: In the aftermath of the above described events, I returned to the OR and noticed the anesthesia sheet that I had used to tabulate the vital signs for Dr. Rodenberg was left on the anesthesiologist's table. I retrieved the data and went to the administrative office to hand him the document. Dr. Rodenberg was in the administrator's office with Dr. Moya and Dr. Escobar so I waited outside until their conference was over. As I handed the document to the records keeper Johan Castenada, Dr. Rodenberg exited the office. When I told him that I was placing the document on the operative record, he instructed me to destroy the record. He stated that it was unnecessary for me to get involved in this case since he had been monitoring the patient from his position in the OR and he did not need my tabulations. I was hesitant to destroy the records and asked Dr. Escobar for advice in the matter. Dr. Escobar insisted that I place the recorded data in the operative records where it stands now. He also advised me to file an incident report which I did. Yet in his deposition, Dr. Rivera-Kolb testified that he did not initially record the numbers on the Anesthesia Record, but instead entered them on a Progress Note form: I asked him first, where's the anesthesia sheet? He responded, you know, I don't want you writing in my official documents. And then I was concerned that this could have been a Monitored Anesthesia Care case, I was going to ask him what-–if there had been any changes but he said to me, this is still no anesthesia, local only case, like I told you before. * * * I looked for an anesthesia sheet. They told me they're supposed to be there. I opened a few drawers. I found a progress note and I wrote it on a progress note paper and later transferred it to this page [referencing the Anesthesia Record for the earlier discogram procedure]. * * * I had finished all the numbers in the monitors, yes. I had finished them all but I had to go to another room to transfer it to an anesthesia sheet that I found, you know, when I asked one of the circulating nurses. If the Anesthesia Record for the facet radiofrequency lesioning was not created in the operating room, but was created later in another room from notes made on a Progress Note sheet, the Anesthesia Record could not have been left on the anesthesiologist's table in the operating room following the third procedure. It is undisputed that Dr. Rivera-Kolb sat at the head of the table for the first and third of J.D.'s procedures on June 25, 2008. Numerous medical records of J.D. prepared at or near the time of her procedures provide clear and convincing evidence that the procedures were to be conducted under MAC. The Anesthesia Record dated June 25, 2008, and signed at the bottom by Dr. Rivera-Kolb indicates "MAC local." A Pre-Anesthesia Evaluation form dated June 25, 2008, indicates "MAC w/ GA b/u" after the words "anesthetic plan." The two different Anesthesia Records prepared by Dr. Rodenberg indicate either "MAC" or "MAC local." The Operative Report prepared by Dr. Moya dated June 25, 2008, and describing the second and third procedures, identifies Dr. Rodenberg as anesthesiologist and references "local MAC anesthesia." A Progress Notes form dated June 26, 2008, indicates "Anesth Rivera MD (MAC)." An Anesthesia Charge Sheet dated June 25, 2008, prepared for the discogram indicates the procedure is to be conducted under "MAC" and is signed by Dr. Rivera-Kolb as "Anesthesiologist 1." The Anesthesia Charge Sheet dated June 25, 2008, prepared for the discectomy and facet radiofrequency lesioning indicates that the anesthesia is "MAC" and shows an anesthesia start time of 12:01 p.m. and an anesthesia end time of 13:24 p.m. A Florida Atlantic Orthopedics form dated June 25, 2008, and signed by Nurse Lerfald shows "MAC," indicates the anesthesiologists as Dr. Rodenberg and Dr. Rivera-Kolb, and notes that anesthesia starts at 11:25 a.m. and ends at 13:14 p.m. Dr. Rivera-Kolb's argument that all of these references to MAC surgery should be ignored because the records might have been altered by Dr. Rodenberg is rejected. If Dr. Rodenberg had an opportunity to alter the records, it is not clear why he would not have simply replaced the Anesthesia Record rather than write a note to Dr. Noback. Even if Dr. Rodenberg did have an opportunity to alter the records, however, there is no apparent motive for him to systematically alter numerous documents prepared by different individuals to indicate that the surgeries were MAC if they were not, or any evidence that he did so. Mr. Escobar's testimony in general and, on this point in particular, was not credible. The documents prepared at or near the time of J.D.'s procedures are credited over other documents prepared after the procedures were completed, which were less consistent. A Physician Office Incident Report, which appears to have been stamped as received by the Department of Health on August 11, 2008, states that "[p]atient underwent lumbar discography, percutaneous discectomy, and facet ablation under local anesthesia." Dr. Rivera-Kolb's statement for the medical investigator, dated March 2, 2010, states that "Dr. Rodenberg, the anesthesiologist, requested that I monitor the patient's vital signs and post them in the anesthesia record sheet while he performed minimally invasive procedures under local anesthesia with Monitored Anesthesia Care." Dr. Moya, in his August 21, 2014, deposition, testified, "Well, at that stage of the procedure [the discography], which is done solely under local anesthesia, the person assigned by the anesthesiologist would be someone that looks at the graphs and makes sure that all is within normal limits." Dr. Moya went on to state that Dr. Rodenberg was always the anesthesiologist for all three procedures. Standards Dr. Orlando G. Florete, Jr., holds active and valid Florida Physician's License No. ME 0058430. He is a specialist in anesthesiology with a subspecialty in pain management. He is Board certified in anesthesiology, is a Diplomate of the American Board of Anesthesiology, and was recently elected as president of the Florida Society of Interventional Pain Physicians. He practices anesthesiology on a regular and routine basis at the Jacksonville Surgery Center. He is also the medical director of a pain management office at the Baptist Hospital in Jacksonville. He has been engaged by the U.S. Department of Justice as a consultant and is an expert medical advisor for the Florida Department of Labor and Employment Security and for the Florida Department of Health. He served as clinical assistant professor in the Departments of Anesthesiology and Medicine at the University of Florida, College of Medicine, from 1994 until 2000, where he trained residents, fellows, and medical students. He has recently been engaged by the university to teach again in the field of anesthesia and pain management. Dr. Florete is an expert in anesthesiology and has knowledge, skill, experience, training, and education in the prevailing professional standard of care recognized as acceptable and appropriate by reasonably prudent anesthesiologists in Florida. No evidence was presented that Dr. Florete has been recently engaged in active clinical practice, consultation, the instruction of students, or a clinical research program in the general practice of medicine. Dr. Florete conducted a complete review of records provided to him by the Department pertaining to J.D.'s medical treatment on June 25, 2008, including records prepared by Dr. Rivera-Kolb, Dr. Rodenberg, Dr. Moya, Mr. Escobar, and Nurse Lerfald. He also reviewed the depositions of Dr. Moya and Dr. Rivera-Kolb and heard live testimony from Dr. Rivera-Kolb. As Dr. Florete testified, under the American Society of Anesthesiologist's physical status classification system, a patient classified as "P2" is a patient with systemic disease with mild limitation. A classification of "P3" means that the patient has significant or severe systemic disease with definite severe systemic or physical dysfunction. As Dr. Florete testified, the classification of a patient has an impact on the procedure and type of anesthesia used; so, an anesthesiologist must know the physical status of the patient. As Dr. Florete testified, midazolam is a generic name for Versed, in the benzodiazepine class, that is a very potent intravenous sedative that can produce amnesia and loss of consciousness. Propofol, in a one percent emulsion, is a milky- colored intravenous anesthetic that can promote rapid loss of consciousness. Dr. Florete testified, and it is found, that Versed and propofol are the most commonly used combination under monitored anesthesia care to produce that unique level of sedation that allows the surgeon to perform surgery without the patient being agitated, moving, or crying out. As Dr. Florete explained, the acronym "MAC" stands for "monitored anesthesia care." Monitored anesthesia care is a type of anesthesiology in which a qualified anesthesiologist monitors the patient. MAC requires an anesthesiologist to monitor physiological variances of the patient, such as rising blood pressure, increase of heart rate, loss of airway, or agitation in the patient. In MAC, the anesthesiologist must determine what level of anesthesia is advisable and be prepared to administer the medications to induce deep sedation as required. As Dr. Florete testified, a nurse may "tabulate" a patient's oxygen levels, breathing, circulation, and temperature in a case involving only local anesthesia, but simple tabulation of these vital signs by a nurse is not permitted in a MAC case because a nurse is not qualified to make the required judgments. Only an anesthesiologist is authorized to perform monitoring in a MAC case or to fill out an Anesthesia Record. As Dr. Florete testified, a person who assumes the position at the head of the table monitoring a patient in a case of monitored anesthesia care assumes the responsibilities of an anesthesiologist. As Dr. Florete testified, the prevailing professional standard of care requires an anesthesiologist to perform a physical examination of the patient and review the history of the patient prior to MAC. An anesthesiologist must keep records that document the pre-operative medical examination; indicate the type of anesthetic technique employed; indicate the start and end times of anesthesia; record the patient's vital signs over time; and indicate who provided anesthesia to the patient and when. An anesthesiologist must stay with the patient after a procedure until the patient is safely delivered into the PACU. Dr. Florete testified that in a MAC case, it would be a violation of the prevailing professional standard of care for a single person to both perform surgery and attempt to act as anesthesiologist for that same procedure. In a local anesthesia case, a single person could perform both roles. Dr. Florete testified that because Dr. Rivera-Kolb was not an anesthesiologist he "had no business" filling out an Anesthesia Record. Dr. Florete credibly testified that in his opinion, Dr. Rivera-Kolb's actions in monitoring Patient J.D. during surgical procedures that he knew or should have known were to be conducted under MAC and in preparing the Anesthesia Record for a procedure constituted the acceptance and performance of the responsibilities of an anesthesiologist, which Dr. Rivera-Kolb was not competent to perform. Medical Records As Dr. Florete testified, in assuming the responsibility to perform the professional duties of an anesthesiologist, it was incumbent upon Dr. Rivera-Kolb to keep complete and accurate Anesthesia Records that documented a pre- operative medical examination of J.D.; indicated the type of anesthetic technique that was employed; indicated the start and end times of the anesthesia; recorded J.D.'s vital signs over time; and indicated who provided anesthesia to her and when. While Dr. Rivera-Kolb did prepare an Anesthesia Record for the discogram, it failed to record any temperature readings, breath sounds, or EKG readings. As Dr. Florete testified, this Anesthesia Record was incomplete. As for the facet radiofrequency lesioning procedure, it is clear that Dr. Rivera- Kolb, contrary to his testimony, did not keep an Anesthesia Record containing a complete and accurate report of J.D.'s vital signs or documenting who provided anesthesia and when. As Dr. Rivera-Kolb admitted in his testimony, he was the only physician present after the third procedure when J.D. began to exhibit bradycardia and desaturation. Yet he did not document his evaluation of these events in J.D.'s medical records to justify his treatment of J.D. There was no evidence that Dr. Rivera-Kolb conducted a complete physical examination at the time of either the first cardiac arrest in the operating room, or the second cardiac arrest in the PACU. Dr. Rivera-Kolb was present and assisting in the medical treatment of J.D. through two procedures and during two cardiac arrests; yet, the only medical records kept by Dr. Rivera-Kolb were those pertaining to the first procedure. While Dr. Rivera-Kolb maintained that he completed an incident report, this testimony is rejected as not credible. No such report is found in J.D.'s medical records, and Dr. Rivera-Kolb's suggestion that Dr. Rodenberg may have removed it for some unknown reason is only unsupported speculation. There is clear and convincing evidence that Dr. Rivera- Kolb failed to keep legible medical records that justified the course of treatment of Patient J.D., including Anesthesia Reports and records of his evaluations. Dr. Rivera-Kolb was charged with violating the standard of care both in performing as an anesthesiologist during J.D.'s procedures and in assisting in treatment of her complications afterwards. He failed to keep medical records reflecting his participation in the treatment of J.D. for either of those times. The Department did not show that in earlier discipline, Dr. Rivera-Kolb was found to have failed to keep medical records. Medical Malpractice Dr. Rivera-Kolb assumed the responsibility of monitoring J.D. and preparing Anesthesia Records, thereby practicing as an anesthesiologist when he was not competent to do so. As Dr. Florete testified, the prevailing professional standard of care for a given health care provider is that level of care, skill, and treatment which, in light of all relevant surrounding circumstances, is recognized as acceptable and appropriate by reasonably prudent similar health care providers. In assuming the responsibilities of an anesthesiologist, Dr. Rivera-Kolb is held to the standards recognized by reasonably prudent anesthesiologists. The Department proved that Dr. Rivera-Kolb did not complete a residency, have adequate training, and did not have board certification in anesthesia, all of which Dr. Rivera-Kolb himself admitted. As Dr. Florete testified, a general practitioner engaged in providing anesthesia care would not meet the prevailing professional standard of care. In evaluating Dr. Rivera-Kolb's actions after the three procedures that were performed on J.D., however it was not clearly shown that Dr. Rivera-Kolb continued to act as an anesthesiologist. To the contrary, it appears that Dr. Rivera- Kolb performed as an anesthesiologist during the procedures themselves, in part, because he knew that the surgeon was an anesthesiologist. After the procedures, Dr. River-Kolb resumed the role of a general practitioner, deferring to Dr. Rodenberg and Dr. Moya, and even acting at their direction. The prevailing professional standards of care applicable to the general practice of medicine with respect to J.D.'s post-operative complications were not established. Dr. Florete did testify that, as an "intensivist" who used to "run codes" for some hospitals in Jacksonville, he was familiar with emergency and critical care procedures. He also testified that "any medical doctor" should be able to diagnose pneumothorax "within one minute," because air trapped under the skin produces bulges or swelling which when pressed produces an unmistakable "crackling" sound as the gas is pushed through the tissue. He provided compelling testimony as to the proper diagnosis and treatment of pneumothorax. However, it was not shown that Dr. Florete was qualified to give expert testimony regarding the prevailing standards of care for a general practitioner.6/ Moreover, even if these had been established as the prevailing professional standards of care applicable to a general practitioner, it is not clear that they were violated by Dr. Rivera-Kolb in his treatment of Patient J.D. on June 25, 2008. Dr. Rivera-Kolb was charged with failing to fully evaluate the cause of the bradycardia and the desaturation once the first cardiac arrest occurred. The evidence showed that Dr. Rivera-Kolb immediately put a mask over J.D. and began to ventilate her. Dr. Rodenberg arrived within one minute and assumed control over the situation. Dr. Florete credibly testified that because of training and experience, an anesthesiologist should take the lead in such "code" situations, followed by the surgeon, and finally a general practitioner. It was therefore appropriate for Dr. Rivera-Kolb to defer to Dr. Rodenberg when he arrived. The evidence did not show that before Dr. Rodenberg arrived, there was sufficient time for Dr. Rivera-Kolb to have performed a complete physical examination of J.D. or to auscultate J.D.'s lungs, even if he had had a stethoscope, which he testified that he did not. There is no evidence that in this brief period of time, Dr. Rivera-Kolb caused any significant delay in recognizing the evolving medical emergency or in beginning treatment of J.D. Dr. Rivera-Kolb was also charged with medical malpractice in connection with the treatment of Patient J.D. after she had been stabilized following the first cardiac arrest and moved to the PACU. The Department alleges that Dr. Rivera- Kolb misdiagnosed J.D.'s condition, failed to identify the pneumothorax, and caused delay of treatment. One allegation of misdiagnosis stems from the written statement provided to the Department's medical investigator, as quoted earlier: The symptoms she displayed were consistent with a vasovagal syndrome secondary to local anesthetics injected in the cervical area during the procedure, which is not an uncommon complication. Dr. Florete did testify that vasovagal syndrome could be drug induced. However, contrary to Dr. Rivera-Kolb's statement, it is clear that no local anesthetic would have been administered intravenously through J.D.'s jugular for her procedures. The statement therefore fails to provide an explanation of J.D.'s condition to that extent. In his deposition, Dr. Rivera-Kolb admitted this, testifying that he became confused when writing the statement "two years later." He said that he was thinking that perhaps the jugular IV had pulled away from the vein and was "dripping all those chemicals" into her. Dr. Rodenberg did in fact conclude that the left jugular IV was infiltrated, which is why he inserted the second external jugular line into J.D.'s right side. In any event, Dr. Rivera-Kolb's statement was written some 20 months after the event. It is not clear that Dr. Rivera-Kolb's statement was his diagnosis on June 25, 2008. It may have been that the analysis in his statement was simply Dr. Rivera-Kolb's recollection of Dr. Rodenberg's diagnosis or simply his own opinion in looking back at the events of that day. Another allegation of misdiagnosis is predicated on Nurse Lerfald's identification of J.D.'s facial swelling. Nurse Lerfald went to get Dr. Rodenberg as soon as she noticed it. Patient J.D.'s face was "completely swollen" when they returned, and Dr. Rodenberg immediately assumed control of her treatment. However, there is scant evidence as to how much time passed between the time the swelling was first noticed and the time Dr. Rodenberg arrived. Nurse Lerfald's statement doesn't discuss it. Dr. Rodenberg's statement notes only that when he was called back to the PACU "[a]bout ten minutes had elapsed since the initial period of instability," with no mention of how long it took him to respond after he received the summons. Dr. Rivera- Kolb testified in his deposition that after the swelling was noticed, he put the head of J.D.'s bed down and pushed the endotracheal tube down, saying "[i]t took about less than a minute" before Dr. Rodenberg arrived. While Dr. Florete also testified that it should take "less than a minute" to diagnose pneumothorax from observation of the swelling, it was not clearly shown that Dr. Rivera-Kolb had even that much time before Dr. Rodenberg assumed control for the second time. It is clear that once the pneumothorax was identified, it should have been immediately treated by inserting a large-bore needle into each side of the chest to allow the air to escape while waiting to place the chest tubes. The failure of Dr. Rivera-Kolb to insert such needles immediately after the diagnosis was also alleged to constitute malpractice. But, it is undisputed that the pneumothorax was identified by Dr. Moya; after which diagnosis, Dr. Moya immediately began to insert the chest tubes. The diagnosis and treatment occurred very close in time. It was not clear from the evidence that there was any "wait" time after the diagnosis but prior to Dr. Moya's insertion of the tubes in which Dr. Rivera- Kolb could have acted, even assuming it was appropriate for him, as a general practitioner, to take over treatment of the patient from the orthopedic surgeon who had just made the diagnosis. Even if there had been competent testimony as to the prevailing professional standard of care for a general practitioner, the evidence did not clearly show that Dr. Rivera- Kolb failed to meet that standard or failed to use reasonable care. The Department established by clear and convincing evidence that Dr. Rivera-Kolb committed medical malpractice when, as a general practitioner, he engaged in providing anesthesia care. Scope of Practice The Department presented evidence indicating that propofol was in fact administered to J.D. on June 25, 2008. First, there were pharmacy bills in J.D.'s medical record indicating propofol had been issued for her procedures on that date. Second, there were written statements from Nurse Lerfald and Dr. Rivera-Kolb himself that when the left chest tube was placed, air bubbles and a white-colored fluid were discharged. Dr. Florete indicated that the discharge of the whitish fluid from the chest tube was evidence that propofol was given to J.D., because no other drugs administered in this case other than propofol would have produced a white milky fluid.7/ It was not necessary for the Department to show that Dr. Rivera-Kolb himself administered propofol to J.D., that he knew that Dr. Rodenberg had done so during J.D.'s second procedure, or even that he "feared that that was the case" in order to show that Dr. Rivera-Kolb accepted or performed professional responsibilities which he knew he was not competent to perform. The evidence is clear and convincing that Dr. Rivera-Kolb knew, or should have known, that the procedures were to be conducted under MAC.8/ He signed more than one paper indicating this, once in a block designated as "Anesthesiologist 1." He also knew, from his earlier treatment of Patient J.D., that she had accelerated hypertension and that MAC procedures might be advisable. Despite his testimony to the contrary, it is clear that Dr. Rivera-Kolb accepted the responsibility to act as an anesthesiologist during two procedures and to prepare the Anesthesia Record for at least the first of these, and then proceeded to do so. The fact that Dr. Rivera-Kolb knew that Dr. Rodenberg was an anesthesiologist and was in the room performing the surgeries does not excuse Dr. Rivera-Kolb's actions or lessen his responsibility. If Dr. Rivera-Kolb at the time of the facet radiofrequency lesioning did not know specifically what sedatives were and were not administered earlier by Dr. Rodenberg or some other person, that fact would not be exculpatory, but incriminating. Dr. Rivera-Kolb is not board certified in anesthesiology. He has not completed a residency in anesthesiology and has not had adequate training in anesthesiology for him to perform the duties of an anesthesiologist. Dr. Rivera-Kolb knew that he was not competent to perform the professional responsibility of providing monitored anesthesia care to Patient J.D. during her procedures. There is clear and convincing evidence that Dr. Rivera- Kolb accepted and performed the professional responsibilities of an anesthesiologist, which he knew that he was not competent to perform. Dr. Rivera-Kolb's actions in knowingly accepting and performing professional responsibilities which he knew that he was not competent to perform exposed J.D. to potentially severe injury or death. Prior Discipline In December 2003, an Administrative Complaint was filed against Dr. Rivera-Kolb in the Department's Case No. 2001-22573. The complaint alleged that he failed to keep required medical records, prescribed a legend drug other than in the course of his professional practice, and committed medical malpractice in violation of sections 458.331(1)(m), (1)(q), and (1)(t), Florida Statutes (2001), respectively. In December 2003, another Administrative Complaint was filed against Dr. Rivera-Kolb in Case No. 2002-13550. The complaint alleged that he failed to keep required medical records and committed medical malpractice in violation of sections 458.331(1)(m) and (1)(t), Florida Statutes (2002), respectively. In February 2006, Dr. Rivera-Kolb entered into a Consent Agreement with the Department of Health in settlement of these two complaints. In a Final Order incorporating the Consent Agreement issued on April 19, 2006, the Department imposed a reprimand, fine, and two-year period of probation against Dr. Rivera-Kolb's license. The Consent Agreement contained no provision finding that Dr. Rivera-Kolb had committed any of the offenses alleged in the complaint. Dr. Rivera-Kolb was not under any legal restraints on June 25, 2008. It was not shown that Dr. Rivera-Kolb received any special pecuniary benefit or self-gain from his actions on June 25, 2008. It was not shown that the incidents involved any trade or sale of controlled substances.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Department of Health, Board of Medicine, finding that Dr. Rivera- Kolb violated sections 458.331(1)(m), (t), and (v), Florida Statutes, as charged in the Administrative Complaint, and imposing an administrative fine of $20,000.00 and a four-year suspension of his license to practice medicine. DONE AND ENTERED this 19th day of December, 2014, in Tallahassee, Leon County, Florida. S F. SCOTT BOYD 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 19th day of December, 2014.
The Issue The basic issue in this case is whether Deering Hospital's application for a certificate of need to operate an inpatient cardiac catheterization program should be granted or denied.
Findings Of Fact Deering Hospital, formerly known as Coral Reef Hospital, is located at 9333 Southwest 152nd Street, Miami, Florida, in HRS District 11, Dade County. Deering Hospital has a total of 260 beds: 170 medical/surgical, 54 adult psychiatric, 16 adolescent and child psychiatric and 20 substance abuse beds. It is an acute care hospital. Deering's primary geographic service area is north to the town of Kendall, west to the Everglades, east to Biscayne Bay and south to 232nd Street. The secondary service area is south to the Florida Keys. Deering's primary service is defined by 62 percent of its admissions, its secondary service area by 17 percent, and all other areas, including North Monroe County, comprise 21 percent of all its admissions. Competitors in Deering's primary and secondary service areas include Kendall Regional Medical Center, Baptist Hospital, South Miami Hospital, and South Miami-Homestead Hospital, which was previously called James Archer Smith Hospital. These hospitals have shared a service area as long as they all have existed. South Miami-Homestead Hospital does not have a cardiac catheterization laboratory. Deering is within 30 minutes travel time of three full service cardiac catheterization programs located in facilities with open heart surgery, including two of the challengers to its application. On June 18, 1990 South Dade Health Care Group, Ltd., was formed in order to acquire Coral Reef Hospital. South Dade Health Care Group, Ltd., at the time of the application was and is currently licensed by HRS to operate Deering Hospital. Columbia Hospital Corporation of South Dade ("Columbia') is the general partner of South Dade Health Care Group, Ltd. Columbia, acting on behalf of South Dade Health Care Group, Ltd., acquired Coral Reef on September 26, 1990. Coral Reef changed its name to Deering Hospital on April 2, 1991. Deering's CON application in this batch cycle was submitted on March 25, 1991. The June 18, 1990, audited balance sheet for South Dade Health Care Group, Inc., was prepared for a development stage enterprise and is an audit of costs to start up the hospital after the acquisition by Columbia. The December 31, 1990, audit covers a 97 day period from September 26, 1990, (date of acquisition) to December 31, 1990, and included development and organizational costs. Since the applicant/entity/licensee did not exist before June 18, 1990, and the hospital was not acquired by that entity before September 26, 1992, there are no other financial statements that could have been prepared before the Deering application was submitted on March 25, 1991. South Dade Health Care, Group, Ltd., submitted a timely and valid letter of intent and a timely application for Certificate of Need ("CON") 6664 to provide in the July 1993 planning horizon inpatient cardiac catheterization services at Deering Hospital. South Dade Health Care Group, Ltd., and Columbia have authorized Deering Hospital's participation in this case. The capital projects list in the application is complete. When Deering was purchased by Columbia in 1990, Deering had a special procedure room that was apparently equipped and had the capacity to provide diagnostic coronary catheterizations as well as peripheral (i.e., the extremities) vascular diagnostic and therapeutic procedures. Although outpatient catheterizations had been performed in the special procedure room in the past, none were being done when Columbia acquired the hospital in September 1990. In late 1990, following evaluation of the equipment, Deering recruited an experienced CCRN cardiac catheterization laboratory nurse, hired a qualified CV tech, and began offering outpatient cardiac catheterization services. The decision to begin outpatient cardiac catheterization services was based in part on the idea that there would be no capital costs since the equipment to perform the procedures already existed. In December of 1990, the existing outpatient cardiac catheterization laboratory did about nine procedures and experienced some equipment failures. As a result of the equipment failures, Deering temporarily stopped doing outpatient cardiac catheterization, but was able to continue doing special procedures (vascular and arterial catheterizations, not coronary) in the room. After exploring various possibilities, Deering entered into a lease to obtain new equipment for its existing outpatient cardiac catheterization laboratory and signed a renewal lease to continue the lease of the equipment that was already in the outpatient laboratory. In January of 1992 the hospital resumed doing outpatient cardiac catheterization procedures and ten outpatient cardiac catheterizations have been performed in the room since January 31, 1992. From 1985 through April of 1991 the Deering outpatient cardiac catheterization program has done a total of twenty-nine outpatient procedures. The lab was closed temporarily to outpatient cardiac catheterization procedures from March 1991 through January 1992 in order to bring in new equipment. The hospital has been diligent and persistent, from the date Deering was acquired by Columbia to the present, in its efforts to maintain and enhance its outpatient cardiac catheterization program. Currently, however, if a Deering inpatient needs a cardiac catheterization, that patient must be taken past an active outpatient catheterization laboratory at Deering, only to be transferred to another hospital with an inpatient cardiac catheterization certificate of need. In health planning, it is generally desirable to use existing facilities and equipment to do additional procedures. By its application in this case, Deering proposes to use its existing outpatient cardiac catheterization laboratory to perform inpatient cardiac catheterization. For calendar year 1991, about 50 cardiac catheterization inpatients were transferred from Deering to other hospitals. Patients requiring inpatient cardiac catheterization or open heart are transferred from Deering to South Miami Hospital, Baptist Hospital, or Kendall Regional Medical Center. At Deering the spatial relationships between the existing outpatient cardiac catheterization laboratory and related services such as telemetry and intensive care appear to be adequate. Deering has 16 telemetry beds and they can be easily increased if needed. An uncomplicated inpatient cardiac catheterization typically results in one day in telemetry. Deering has ample capacity for over 300 additional telemetry patient days. At Deering the intensive care unit and the coronary care unit are collectively referred to as the critical care service (CCS). Deering has 14 CCS beds where a patient can be directly connected to a cardiovascular monitor allowing monitoring of any clinical changes. The current CCS average daily census is ten (10). Deering's application is not by or on behalf of an HMO. No evidence was presented to show that HMO's in District 11 have unmet cardiac catheterization needs or that Deering's application would fulfill any needs of HMO's. To the contrary, HMO's have a tendency to prefer cardiac catheterization services at facilities with open heart surgery. Typically an uncomplicated diagnostic cardiac catheterization does not require a CCS stay. Even if 50 percent of Deering's cardiac catheterization inpatients required CCS during their stay, Deering has the capacity to accommodate the 150 additional CCS patients annually. The physical space which comprises the existing outpatient cardiac catheterization laboratory is clinically adequate in its current configuration to facilitate communication during the procedure and time savings. The dark room, computer room and procedure room are all adjunct. There are no medical or clinical reasons why the space is not adequate. According to the medical director, who has extensive experience at other hospitals and who has performed outpatient cardiac catheterizations in Deering's procedure room, Deering's procedure room is more than adequate for performing inpatient cardiac catheterization. If the inpatient certificate of need is granted, the procedure room where outpatient catheterizations are currently performed will continue to be a mixed used room, i.e., peripheral angioplasties and coronary catheterizations will be scheduled in the same room. Deering Hospital is JCAHO accredited. It received a three year accreditation in 1991. The laboratory currently used for outpatient procedures was surveyed by JCAHO as a special procedure room. Deering has never been cited in any JCAHO or HRS licensure survey for any inadequacy in life, safety, or fire codes in the outpatient cardiac catheterization special procedure room. Deering currently has all of the equipment, staff and ancillary services described in, and required by, the applicable rule. Deering has two physicians on staff that serve and are compensated as co-directors of the existing outpatient cardiac catheterization laboratory. Dr. Palomo is co-medical director of the existing outpatient cardiac catheterization program and will be co-medical director of the inpatient program if the program is approved. Dr. Palomo is Board certified in internal medicine and Board certified in cardiovascular diseases. He was previously an assistant professor of medicine at the University of Miami and ran the cardiac catheterization lab at the Veteran's hospital in Miami. Last year Dr. Palomo performed 300 cardiac catheterizations in the Miami area. Dr. Palomo has cardiology staff privileges at six Miami hospitals, including two of the challengers to this application, Baptist Hospital and South Miami Hospital. He lives ten minutes from Deering Hospital and his office is located eight minutes from Deering. There is no industry standard for credentialing cardiac catheterization laboratory nurses, but it is generally agreed that all cardiac catheterization personnel should be ACLS trained. All Deering nurses who are cross-trained for the cardiac catheterization laboratory are ACLS certified. Deering has also cross-trained an ECHOvascular technician into the scrub roll in the laboratory. All current cardiac catheterization laboratory staff and all cross-trained cardiac catheterization laboratory staff are already full time Deering employees. Current staff can accommodate the projected volume of inpatient cardiac catheterizations and the current rate of peripheral and outpatient catheterizations. If awarded the service, Deering would be able to implement the service the day of the award. The current staff is adequate regardless of whether they are performing an inpatient, outpatient, or peripheral procedure. The staffing of the inpatient lab would be the same as the current outpatient laboratory; i.e., a physician, RN and a CVT. There would not be any need to add staff if the number of procedures increased between 300 and 1,000 annually. Accordingly, Deering does not intend to recruit additional professional personnel from the local market. The capacity of Deering's existing laboratory, when used for inpatient cardiac catheterization procedures, can conservatively be calculated as follows: 1 hour from arrival at the procedure room to departure from the procedure room, times an 8 hour day, times a 5 day week, times 52 weeks a year equals 2,080 case theoretical capacity. One-half that theoretical capacity is four cases a day or 1,040 cases a year. A cardiac catheterization laboratory can typically do between 1,000 and 1,500 cases per year. Four cases per day (1,040 cases per year) is a reasonable number to express the capacity of Deering's existing laboratory to accommodate inpatient procedures with current space, equipment and staff. The existing inpatient cardiac catheterization laboratories in District 11 have similar capacities. With additional staffing, Deering or any of the existing laboratories might have even greater capacities. If granted inpatient cardiac catheterization services, Deering would not do coronary angioplasties because it does not have open heart surgery in the same facility. Deering maintains transfer agreements with other facilities for services that Deering does not provide. Deering has developed an adequate protocol outlining how an open heart or angioplasty backup patient would be transferred. Deering has established medically appropriate criteria for granting and maintaining privileges in its outpatient cardiac catheterization laboratory that would be suitable for the proposed inpatient cardiac catheterization program. Deering has developed adequate and appropriate forms to manage its patient care in the outpatient program which would be suitable for the inpatient program. Deering has developed clinically adequate and appropriate protocols for temporary pacemaking, recording hemodynamic data, and insuring the emergency availability of staff in the cardiac catheterization laboratory. Deering has a policy and procedures statement to orient new employees to the cardiac catheterization laboratory. Generally, there is no alternative to cardiac catheterization when catheterization is medically indicated. However, there are alternatives to Deering's application, such as allowing existing providers to achieve efficient levels of utilization. Deering is not proposing joint, shared, or cooperative health care services. Deering is not proposing to provide services for research or teaching purposes. Deering does not propose to provide a substantial portion of its services to individuals not residing in the service district. Indeed, inpatient cardiac catheterization services are readily available in adjoining service areas. Deering is not proposing any new construction in its application. Deering is not proposing to add nursing home beds. No service reductions will occur as a result of this proposal. Financial feasibility of a project means the project can be accomplished within the financial resources of the overall institution. Short- term financial feasibility means the applicant can cover the start-up project costs. Long-term financial feasibility means the project will generate a surplus of operating revenue over operating expenses within two years. The proposed project would most likely be financially feasible in the short and long-term, even though (for reasons addressed below) it is unlikely to achieve the results projected in the pro formas. This is because Deering is already operating an outpatient cardiac catheterization laboratory and would have very little additional expense if it began performing inpatient cardiac catheterizations using the existing staff and the existing equipment. If the project were to be approved, the hospital as a whole would probably have a positive cash flow in the first and second year, because with a mere four or five inpatient procedures it would recover the additional costs associated with converting the existing outpatient lab to an inpatient lab. A contribution margin is the difference between the variable expenses and variable revenues on a per unit basis or in the aggregate. For additional inpatient cardiac catheterization services on a per case basis, Deering projects a positive contribution margin of $2,500 per procedure. This is similar to the contribution margins of other hospitals performing inpatient cardiac catheterizations in Deering's service area. Break-even analysis determines how many procedures must be done before incremental fixed costs are covered. Since incremental fixed costs are $10,000, after only 4 or 5 inpatient procedures the service would break-even. For a number of reasons mentioned below, it is very unlikely that Deering would be able to achieve its projected utilization levels. Specifically, it is unlikely that Deering would be able to achieve a utilization level of 300 admissions per year by the end of its second year of operation. The analysis on which Deering bases its much higher utilization projections appears to be flawed in several respects and is also contrary to reasonable expectations based on the average historical performance of diagnostic-only cardiac catheterization programs in District 11. In an effort to demonstrate that Deering would perform in excess of 300 procedures per year, Deering's health planning expert, undertook the following analysis: The number of MDC-5 (circulatory diagnoses) at Deering in 1990 was approximately 750. It was assumed, from data in the Winslow report and the Dade County actual data that one third of the MDC-5 admissions would receive a cardiac catheterization. Multiplying 750 times one third results in 250 admissions at Deering who would receive a catheterization, or approximately 20 per month. Because some people would refuse to have a catheterization, or would undergo it at another facility, it was assumed that 17 patients per month, or approximately 195 per year, would be cathed at Deering in the first year of operations. It was assumed that the growth at Deering between year one and year two of operations at Deering would be equal to the projected growth in catheterizations in Dade County between July, 1989 and January, 1994. It was assumed that all of the cases projected above would be inpatients. Based on this analysis, it was projected that Deering would be able to do in excess of 300 cases per year starting in its second year of operations. The greater weight of the evidence indicates that this methodology suffers from a number of flaws. The "one third" factor applied in step 2, above, is erroneous and was incorrectly applied even if correct. The Winslow paper provides no support for the proposition that one third of all MDC-5 admissions will require catheterization. The actual statistic from Dade County is that all inpatient catheterizations, including those done in anticipation of open heart surgery and for angioplasty, constitute 21 percent of the number of MDC-5 admissions. Of the catheterizations done in Dade County, 9 percent (1,382 catheterizations out of a total of 16,155) were performed in conjunction with open heart surgery and 16 percent (2,700 of 16,155) were angioplasties. Because Deering will be unable to do either open heart surgery or angioplasty, a full 25 percent of the catheterization case load is unavailable there. Applying the 21 percent factor (percent of actual inpatient catheterizations to MDC-5 admissions) would result in 158 potential catheterizations. Dropping out 25 percent of those (the percent requiring open heart surgery and angioplasty) results in 118 potential cases. Using then the 85 percent figure (to reflect those who refuse to be catheterized or must go elsewhere because of managed care agreements, etc.) leaves approximately 100 inpatient cases in the first year, or roughly half of what Deering projects. There is no persuasive support for the idea advanced by Deering that its growth between year one and year two of operations would be the same rate of growth that all Dade County providers experienced between 1989 and 1994. To the contrary, such an experience is most unlikely. First, the projected rate of growth assumes that Dade County's use rate will continue at the same rate. This is optimistic. Second, it assumes that Deering will reflect the growth in the number of cardiac catheterizations in Dade County even though it is only providing diagnostic catheterizations (i.e. no angioplasties or catheterizations during open heart surgery). Finally, it assumes that Deering's rate in providing cardiac catheterizations will be the same as four and one half years experience in Dade County. If the actual annual rate of increase in Dade County were applied to Deering's own projected first year utilization, it would still only be likely to do 230 cases in the second year. The actual number of patients transferred from Deering for inpatient catheterizations plus its actual number of outpatient procedures provides a more accurate guide to the number of cases Deering could be expected to do. Based upon these figures, Deering might be expected to do between 70 and 150 cases the first year and less than 200 the second. One assumption made by Deering to support its utilization projections was that there would be a growth in the utilization of cardiovascular services at Deering. The historical use pattern at Deering fails to reveal any trend that would suggest such an increase. According to data reported to the HCCCB, there was an overall decline in the number of intensive care days at Deering between 1985 and 1991. Similarly, emergency room visits have also declined during the same period. Emergency room admissions account for 60 percent of all admissions to Deering. As a result, the total number of patient days at Deering has declined from 47,089 in 1985 to 40,975 in 1991. Thus, although Deering is projecting a large increase in utilization to project satisfactory utilization of its proposed laboratory, the historical record does not support that record. According to Deering, indicators of cardiac volume include the following services: EKGs; echocardiograms; holter monitors; treadmills; pulmonary function tests; thallium exams; and, coagulation studies. According to data presented by Deering, none of those "cardiac volume indicators" showed an increase in utilization between 1988 and 1990. In its financial analysis, Deering assumed that all of the 195 procedures in the first year and all 360 in the second year would be inpatient procedures. In Dade County for the 12 months ending September 30, 1991, 39 percent of all catheterizations were done on an outpatient basis (6,240 outpatient procedures out of 16,165 total cases). That percentage would be even higher at facilities that are unable to provide open heart surgery. (For example, currently 80 percent of the cardiac catheterization procedures at Doctors' Hospital are outpatient procedures.) In all of Florida approximately 50 percent of all cardiac catheterizations are inpatient. The trend in Dade County, in Florida, and nationally is that the number, and percentage, of outpatient procedures is increasing. The significance of this fact as it relates to Deering's financial projections is that Deering did not make any adjustment in its utilization projections to account for outpatient utilization and projected the pro formas by assuming that income associated with each case would be the income associated with a full inpatient admission. Thus, the pro forma projections are overstated to the extent that the projected procedures will actually be performed on an outpatient basis. At least 35 percent of Deering's procedures are likely to be on an outpatient basis with the trend indicating that outpatient utilization will actually be much higher. In projecting the average length of stay to be attributed to each inpatient catheterization at Deering, it was assumed that it would be the same length of stay as the District 11 average. The District 11 average includes the average inpatient stay associated with open heart surgery, which is much longer than for a routine diagnostic catheterization. Thus, Deering has overstated its projected average length of stay. In addition, the average length of stay for inpatient catheterizations has been dropping. This compounds the extent to which the number of inpatient days associated with catheterizations has been overstated in Deering's pro formas. One assumption in Deering's financial analysis is that patient days at Deering would increase at the same rate as the population increase in Dade County. This assumption finds no support in the evidence presented at hearing. In fact, it was demonstrated that the actual number of patient days have been declining at Deering since 1985. In 1985, Deering has 47,089 patient days; in 1991 it had 40,975 patient days, a drop of 13 percent. This drop occurred even though Dade County has had continuous steady growth. The financial assumption that Deering's inpatient days will grow at the same rate as the population as a whole is found to be unsupported. One reality check of Deering's projection that it will perform in excess of 300 procedures in its second year of operations is to measure its proposed "capture rate" against that of the other hospitals it will be competing against. In 1990 there were a total of 491 cardiac catheterizations performed on patients who reside in Deering's primary service area. Of these, Baptist, which is a full service provider, was able to capture only 203 cases, or 41 percent. If Deering, with one catheterization lab which is also used to do peripheral procedures, were to capture 300 procedures from its primary service area, this would represent in excess of 60 percent of the procedures from that area, or one and one half times better than Baptist is able to do with a full service catheterization facility, three dedicated catheterization laboratories, four full catheterization teams, and angioplasty and open heart capabilities. It is most unlikely that Deering can achieve such a projection. Deering proposes to provide a diagnostic-only program. Of the 13 cardiac catheterization programs in Dade County, nine are traditional and four are diagnostic-only. The diagnostic-only laboratories in District 11 have historically operated at significantly lower volumes than the laboratories in facilities with open heart surgery. During calendar year 1991 the four diagnostic-only providers performed the following number of procedures: Doctors' Hospital 301 Humana Hospital-Biscayne 55 Palmetto General Hospital 432 Parkway Regional Med. Center 262 TOTAL 1050 The total of 1050 procedures constitutes an average of 262.5 procedures for each of the four existing providers. If this pool of 1050 procedures were to be divided five ways to accommodate a new provider, there would be an average of 210 procedures per diagnostic-only provider. It would require an increase of almost 50 percent in the number of procedures being done by diagnostic-only laboratories for five such laboratories to be performing an average of 300 procedures per year. This is yet another reason for which it is most unlikely that Deering would achieve the utilization levels it projects. There appears to have been little physician acceptance of the outpatient catheterization laboratory at Deering. From 1985 through the date of hearing, Deering only performed 29 cardiac catheterizations. Dr. Palomo is the medical director of the Deering cardiac catheterization laboratory. One of his duties as medical director is "promoting" the laboratory. In 1992, through June 16, Dr. Palomo performed only two or three cardiac catheterizations at Deering; in calendar year 1991, he did four to six cardiac catheterizations at Deering. Dr. Palomo does approximately 300 catheterizations per year. It is unlikely that Deering will perform over 300 catheterization cases per year when its own medical director is doing less than 2 percent of his cases there. South Miami is an acute care hospital located in Dade County. South Miami has a open cardiac catheterization program which means any physician within the community can apply for privileges, and, if granted, perform cardiac catheterizations at South Miami. Until recently, it was a closed program. Baptist is a large, full service acute care hospital located in South Miami, Dade County, District 11. Baptist provides a full array of cardiac services at its Miami Vascular Institute. These include cardiac catheterization, open heart surgery, and angioplasty. Baptist is within the primary service area of Deering. It is approximately eight minutes drive from Deering. Deering currently transfers its cases needing inpatient catheterizations to other hospitals, including Baptist. If Deering were to be approved, and if it were able to perform 360 cases in its second year of operations as it projects, it would most likely be performing something in the neighborhood of 150 cases that otherwise would have been done at Baptist. 3/ This was calculated as follows: There were a total of 491 catheteriza- tions performed in 1990 on patients residing in Deering's primary service area. Of those 491 cases, Baptist performed the catheterizations for 203 patients. If Deering were to perform 360 inpatient catheterizations in its second year of operations, it is projected that Baptist would lose cases in the same relation as its current market penetration, i.e. 41 percent. This equates to 149 cases. This methodology presents a reasonable projection of the number of cases that Baptist would be likely to lose if Deering's application for inpatient cardiac catheterization were approved and Deering were able to achieve its projected utilization levels. Baptist has a contribution margin of approximately $2,560 per cardiac catheterization. This figure is the average revenue per case less the variable costs per case. Using the methodology described above, it is projected that the net annual loss at Baptist, if Deering were approved, would be in the neighborhood of $380,000.00. If Deering were to achieve its projected utilization levels, it is likely that it would also be performing a substantial number of cases that otherwise would have gone to South Miami Hospital or one of the other nearby existing providers. Doctors' Hospital is a 255-bed acute care hospital located in Coral Gables, Dade County, Florida. Doctors' has had a cardiac catheterization program since December of 1986, and is authorized to perform diagnostic catheterization on both inpatients and outpatients. With its current staffing compliment, the Doctors' cardiac catheterization laboratory could comfortably perform four catheterizations per day or between 800 and 900 per year. Doctors' performs cardiac catheterization on all patients regardless of ability to pay. Since 1988, the Doctors' cardiac catheterization laboratory has experienced declining utilization. The following chart represents the utilization of Doctors' cardiac catheterization laboratory since 1988: TOTAL INPATIENT AND CALENDAR YEAR OUTPATIENT CARDIAC CATHS 1988 484 1989 400 1990 380 1991 295 1992 240 (estimated) The Doctors' inpatient cardiac catheterization program is at a crossroads. The current volume is well below the minimum quality threshold which is acceptable for cardiac catheterization laboratories. In its early years of operation, the Doctors' cardiac catheterization laboratory generated a profit. Such is no longer the case. Several factors have resulted in the declining utilization of Doctors' cardiac catheterization laboratory. One of the factors is that more of the existing laboratories have become open staff versus closed staff. Doctors' laboratory has always had an open staff policy. At the time that Doctors' established its cardiac catheterization laboratory, it was one of only two that had an open staff policy. Another factor in the decline of utilization at Doctors' has been a shift from inpatient to outpatient cardiac catheterization. Therefore, the opening of outpatient-only cardiac catheterization laboratories, including the one at Deering, has resulted in a reduction in the number of outpatient cardiac catheterization procedures done at Doctors'. Doctors' does not offer angioplasty or open heart surgery. Doctors' diagnostic-only cardiac catheterization capability has contributed to its declining utilization since Doctors' is unable to compete with full service hospitals for cardiac catheterization patients that require the services of a full service hospital. Another factor which has resulted in the decline in utilization at the Doctors' cardiac catheterization laboratory is a change in HMO service patterns to facilities that can provide full-service cardiology services, including cardiac catheterization, angioplasty, and open heart surgery. The primary reason Doctors' Hospital catheterization laboratory is now losing money is its decrease in utilization. As utilization of a cardiac catheterization laboratory declines, the per unit cost of providing a catheterization increases. Based upon the current market share of inpatient cardiac catheterization patients in District 11, and assuming Deering would be able to achieve its projected year two utilization of 360 new inpatient cardiac catheterization patients, a small number of those patients probably would have otherwise gone to Doctors' Hospital. Because of the declining utilization at the Doctors' cardiac catheterization laboratory, and the fact that its program is not co-located with open heart surgery, the loss of even a small number of patients may be significant to the future viability of the cardiac catheterization program at Doctors' Hospital. If the Deering inpatient program were to be approved, both the Deering and Doctors' programs would likely be low volume programs operating at utilization levels well below the minimum for maintaining quality standards and well below the minimum for economic efficiency. There are 13 providers of inpatient cardiac catheterization services in Dade County which operate a total of 24 catheterization laboratories. These providers are geographically well dispersed in the population centers of the county. The existing inpatient cardiac catheterization providers in District 11 are available, provide high quality care, are appropriate, and are accessible. In District 11 there is an ample excess capacity to provide additional inpatient cardiac catheterizations at existing facilities. The existing catheterization laboratories are not producing sufficient numbers of cases to be operating efficiently. The practical capacity of a typical catheterization laboratory is somewhere between 1,000 and 1,500 cases per year. Given that there are 24 existing catheterization laboratories and four more expected to come on line soon, the existing providers are operating at approximately half of their capacity. These programs have not reached a level of optimal efficiency in terms of operations. Optimal efficiency for health planning purposes should be measured at a level of approximately 80 or 85 percent of capacity. The economic efficiency of the existing providers of inpatient cardiac catheterization would be enhanced if new entries into the market were precluded until existing providers were operating at approximately 80 or 85 percent of their practical capacity. It is well accepted in health planning that a catheterization laboratory must perform at least 300 cases per year in order to maintain proficiency and quality. There appears to be a relative correlation between the number of cases performed in a laboratory and the skill of the staff. In District 11, HMO's and PPO's have shifted their service patterns to facilities that can provide full cardiac services including angioplasty and open heart surgery. The shift in use patterns has had a significant effect on cardiac catheterization laboratories unable to provide angioplasty and open heart surgery. This effect would likely be felt at Deering Hospital if its inpatient lab were approved and supports the conclusion that Deering, as a provider of diagnostic catheterizations only, would be unlikely to achieve its utilization projections. Cardiac catheterization services are highly competitive in District As such, the approval of Deering's application will have little beneficial improvement by way of increased competition. Additionally, the trend in District 11 is for third party payers to contract for the provision of cardiac services at full service providers. As such, Deering would be unable to effectively compete with the nine full service providers of which three, Baptist, South Miami, and Kendall, are in Deering's primary service area. There is no evidence that any patient has had, or is likely to have, problems accessing inpatient catheterization services if this proposal is not approved. The geographic access standard contained in the applicable rule is met by the existing providers. Additionally, none of the programs or doctors have been unable to schedule catheterizations because of heavy utilization at any District 11 catheterization provider. Accordingly, patients are not likely to experience any difficulty in accessing inpatient cardiac catheterization services if Deering's application is denied. Currently and historically, cardiac catheterization has been regulated by HRS as an inpatient institutional health service, not a tertiary service. On February 8, 1991, HRS published official notice of the need for one more inpatient cardiac catheterization program in District 11 for the 1993 planning horizon, calculated in accordance with the methodology in the applicable rule. The fixed need pool in this case was never challenged by Petitioners. The projected number of procedures by population in the planning horizon using the methodology in Joint Exhibit 1 and actual data collected by HRS show that there are enough procedures in the marketplace for Deering to perform 300 in the second year of operation and for the protestants in this case to maintain their annual current volumes. However, major portions of that rule- based methodology have been found to be invalid in the Final Order issued this same day in the related rule challenge cases.
Recommendation On the basis of all of the foregoing, it is RECOMMENDED that a Final Order be issued in this case denying the subject certificate of need application. DONE AND ENTERED this 1st day of April, 1994, at Tallahassee, Leon County, Florida. MICHAEL M. PARRISH, 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 1st day of April, 1994.
Findings Of Fact At all times pertinent to the issues involved herein, Respondent was licensed as a registered nurse in the State of Florida under license number 01271-2. Respondent has been licensed as a registered nurse in Florida since 1951. Since that time she has taken various continuing education courses in the nursing profession and is up-to-date on her continuing education requirements. She began work as a registered nurse with Methodist Hospital in 1967 and remained there until she was terminated 15 years later in December, 1982. According to Mrs. Scott the patient in question here, Mrs. Thornton, was first assigned to her care on the morning of November 26, 1982. This was the first day she met her. Respondent came into Mrs. Thornton's room that morning to get the patient up and ready for the day. At this point, Mrs. Thornton said she did not feel well and was very weak. Instead of a bath, she asked merely for a light sponge bath. The patient was wearing a high-neck "granny flannel" gown which she would not allow the Respondent to remove even to give her the sponge bath. At that time, Mrs. Scott says, Mrs. Thornton had one IV tube connected to an Abbott pump. This IV was connected to the patient's right forearm. Mrs. Scott did not see nor did she know that Mrs. Thornton had a subclavian catheter installed. Mrs. Scott contends that when she did rounds with Dr. Eye in the afternoon of November 26, he advised her to discontinue the IV in Mrs. Thornton's arm because of puffiness of the arm where the IV was connected. When she went to do that, she states she noticed one suture on the inside of the patient's right arm just above the elbow which was not connected to the IV. She showed this to Dr. Eye, who told her to take it out. As a result, she removed the suture and took out the intravenous tube from the right arm. At this point, she asked Dr. Eye if he wanted to send it to the lab and he said no. As a result, she put the IV set and all other throwaways in the wastebasket. At this point, Dr. Eye gave her an oral order to apply warm compresses to the arm. This order was subsequently reduced to writing. Mrs. Scott categorically denied having removed a left subclavian catheter from Mrs. Thornton. In fact, because of the gown Mrs. Thornton was wearing, Mrs. Scott denies even knowing that such a catheter had been installed. In any case, she would not have removed it by herself, she says, because she had been taught never to remove a subclavian catheter without someone else being present. She contends the catheter she removed was not a CVP (central venous pressure) catheter, as she subsequently charted by mistake. In that regard, she wrote in her nurse's notes, she says, merely what Dr. Eye had written in his order as to the description of the catheter to be removed. Dr. Eye had indicated in his orders to "D/C central line", which meant to disconnect the central line catheter (here, the subclavian) and because of the tremendous confusion at the nurses' station at the time she wrote her notes, she put in the wrong procedure. The subclavian catheter in question here was installed by Dr. Nunn, Mrs. Thornton's surgeon, on November 19, 1982.. During the procedure he inserted a 20-gauge catheter into the patient through the left subclavian area. He did not install any other catheter of a similar size. Somewhat later, he received a call from Mrs. Thornton's physician, Dr. Garcia, regarding the fact that a portion of the catheter was still in the patient and as a result, he performed surgery to remove it. He found a part of the catheter outside the wall of the subclavian vein and the remainder still in the vein. The entire portion of the catheter that was left in the patient was removed and the patient recovered satisfactorily from the surgery. In this regard, the danger inherent in leaving a piece of a catheter like this one inside a patient is that the broken remains could cause blockage of either a coronary artery, or if in the vein, a venal blockage. A third possibility is that of infection though this is somewhat more remote. According to Dr. Nunn, there are various causes for a catheter to break. The catheter may be subjected to rough treatment. The catheter itself may be weak. The catheter could be cut by the person removing it when the suture holding it in place is cut, and, although quite unlikely, the catheter might be broken when it is passed through the needle used to insert it. In Dr. Nunn's experience going back to 1955, however, he has never seen an instance where part of a subclavian catheter was left in a patient by accident. Mrs. Grace E. Davis, Mrs. Thornton's daughter, recalls that on the day Mrs. Thornton was released from the hospital, Mrs. Davis had to wait for her in the waiting room while an additional procedure was accomplished prior to the discharge. As Mrs. Davis recalls, when they got home from the hospital, she asked her mother why they had had to wait and Mrs. Thornton said that it was for the purpose of removing the catheter in her heart through which she was getting nitroglycerin. According to Dr. Earl T. Cullins, who reviewed Mrs. Thornton's medical records, she was in the hospital from November 17 through December 6, 1982. The medical records for that period indicated that the only catheters, IV's, or CVP's in the patient on November 26 may have been an Abbott Intravenous in the right arm and a subclavian catheter on the left side. The records further reveal that Dr. Eye gave verbal orders to disconnect the centerline (catheter) on November 26 and the nurse's notes written by Mrs. Scott indicate that on November 26, a CVP (central venous pressure--centerline catheter) was discontinued by her. CVP insertions are generally made in the subclavian plane or through the jugular vein, with the subclavian insertion being preferred. The records are, according to Dr. Cullins, somewhat confusing. For example, he cannot tell from the records whether the subclavian catheter was -being used for medication or whether it was covered with a pressure dressing on November 26. In any event, the records do not indicate that the left subclavian catheter was removed. Instead, they show that a CVP line (centerline catheter) was removed. While he feels that they are one and the same, he cannot tell for certain whether or not they are. At no place do the records or nurse's notes refer to the two together or as one and the same. Dr. Cullins had much to say about the performance of many of the other professionals involved in this case. For example, he described Dr. Eye as a "spastic" personality and questions the order that Mrs. Scott received to "remove the line." Dr. Cullin feels that if there were two lines in place, it cannot be certainly determined from the notes as to which one she removed. He also contends that Dr. Nunn made a mistake when he inserted the subclavian catheter on November 19 by not taking an X-ray after insertion. Another difficulty with the records, according to Dr. Cullin, is in that they reflect the intravenous needle was inserted in the patient's right hand on November 18 and was thereafter moved from hand to hand until November 26 when all drugs, which required two IV's, were stopped. To Dr. Cullin this indicates that even though the records do not specifically show the second line (other than the fact that the intravenous needle is in the right hand) there had to be one from a medical standpoint. Dr. Cullin is convinced that since the incident took place late in the day, it would not be at all unusual for Mrs. Scott to have mischarted the removal of the intravenous needle from the hand as the CVP needle which is in the only entry relating to removal of any intravenous lines. Dr. Cullin also states that the medical records, which on November 25 reflect "IV site good", and the fact that on- November 25, the nurse's notes refer to a transfer of the patient from the intensive care unit with the CVP line intact, without any other intravenous lines being mentioned, does not mean that there were no other lines. In short, Dr. Cullin is stating that the records are so confused it is impossible to tell whether there was one, two, or more intravenous lines in Mrs. Thornton on November 26, and which one was removed by Mrs. Scott. Ms. Ann Halley, Director of Nursing at Methodist Hospital, became aware of the situation involving Mrs. Thornton when she received a phone call from Dr. Nunn, who had installed the catheter and who told her that when he saw Mrs. Thornton that morning for a follow-up check, about a week after her discharge from the hospital, an X-ray showed that a portion of the subclavian catheter he had installed was still in her chest. Mrs. Thornton was returned to the hospital that afternoon for removal of the remaining piece of catheter, at which time Ms. Halley called for the medical records. when she checked them over, she saw that Respondent was the one who allegedly had removed the catheter. She contacted Ms. Jan G. Headrick, the head nurse on the floor with Mrs. Scott on November 26. Ms. Halley and Ms. Headrick had a discussion with Respondent about the situation during which Respondent admitted she had removed the catheter. In fact, she stated that when she cut the suture, the catheter simply fell out. According to Ms. Halley, Respondent did not actually use the term "subclavian" in regard to the catheter in question. However, in her opinion, there was little indication that Respondent was confused as to which catheter was in issue. Mrs. Thornton's patient records, as they relate to the catheter issue, were reviewed by Dr. Eileen Austin, a consultant with many years experience in the field of nursing. Dr. Austin concluded that a subclavian catheter had been removed from Mrs. Thornton in part by a nurse and that the remaining portion left in at the time of initial removal was surgically removed. Her review of the records revealed that three catheters were inserted during the first period of Mrs. Thornton's hospitalization. These were: An intravenous line inserted in the Patient's right hand on November 18, 1982 initially, but which was restarted several times and moved from hand to hand until it was finally capped on November 22, 1982. A catheter of this nature is always less than one inch in length and is never anywhere near seven and a half inches in length. A sub-clavian catheter inserted on November 19, 1982 which is also inserted in a vein. The purpose of this one appeared, here, too for administering drugs. It is approximately twelve inches in length and was removed, according to the records, by Respon- dent on November 26, 1982. An arterial line installed on November 19, 1982 following inser- tion of the sub-clavian catheter described above. The purpose of this line was for the withdrawal of blood for blood gas determination. It is called an arterial catheter and the longest one Dr. Austin has ever seen is two and a half inches. On the basis of the above, it appears obvious that the only one of the three catheters inserted, according to the records, long enough to have been left in the patient, was the subclavian catheter. A subclavian catheter is inserted into the clavian vessel so that the tip of the catheter is near the heart. It is inserted just below the collarbone. The records here reflected no reference in the nurse's notes after Mrs. Scott indicated removal of the subclavian catheter except for two references to dry dressings over the entry area. According to Dr. Austin, the proper procedure for the removal of a catheter is for the nurse to clip the suture holding the catheter to the skin without cutting the catheter. Thereafter, the nurse withdraws the catheter very carefully and, upon complete withdrawal, compares the length of the portion withdrawn with that of the catheter inserted as described in the patient's records. If a piece is broken off inside the patient, the visual examination in this way will reveal that that taken out is shorter than that put in, thereby indicating that some was left in the patient. Here, according to Dr. Austin, the Respondent failed to exercise proper procedure in two areas: one, she failed to note the length of the catheter inserted so that a comparison with removal could be done and, two, she failed to inspect the tip of the catheter on removal. It should be smooth and round. Anything else indicates that the catheter was broken or cut and part was left therein. This must be immediately reported to the physician. In Dr. Austin's opinion, a nurse who would remove a catheter and fail to insure the entire item was removed, and thereafter fails to report that it was not all removed, is unprofessional and puts the patient in a life- threatening situation. Further, assuming that the Respondent's sole improper activity was in mischarting the actual catheter removed, as Respondent contends, this could constitute substandard performance itself. However, the right arterial catheter in Mrs. Thornton was removed on November 20, 1982 at approximately 2:45 a.m. by Randy G. Martin, the hospital supervisor for the 11 - 7 shift that evening. He removed this catheter because the nurse on duty at the time saw that it was bent and there was some concern that it might break or otherwise do harm. At the time of this operation, Mr. Martin noticed that Mrs. Thornton had a subclavian catheter in place. When the arterial catheter was removed, it was measured and examined to see that the edges were good and then saved for the physician to examine the next day. If this arterial catheter was removed on November 20, it could not have been there on November 26, as Respondent says. Dr. Eye gave certain orders to discontinue all intravenous medication on November 22, 1982. The doctor's orders are as follows: D/C central line Per. with other meds this way Warm heat to rt arm Penicillin 500 mg-p/o Q.I.D. Serum theophyllin 6 hours after dose (scratched out) Room air arterial blood gas Sunday am. D/C all IV medication Dr. Eye's orders O.K.'d w Dr. Garcia Respondent as was stated before, contends she did not remove the subclavian catheter but instead removed the arterial catheter in the right arm, thereafter inaccurately charting its removal as the CVP catheter. She said she did this because she merely quoted the doctor's order. Thorough consideration of the above evidence admitted both for and against the Respondent, considered in light of the inherent probabilities and improbabilities of the evidence, results in the inescapable conclusion that Respondent did in fact withdraw the subclavian catheter from Mrs. Thornton and, in doing so, failed to insure that the entire catheter was removed. As a result, a 5 to 6 centimeter long piece of the catheter was left in Mrs. Thornton's chest which was surgically removed several days later. It is neither alleged nor found that Mrs. Scott was responsible for the catheter breaking. However, the evidence is clear that when she removed the catheter she failed to take those steps necessary and dictated by proper nursing procedures to insure that the entire catheter was removed. An independent examination of Mrs. Thornton's medical records by Dr. Austin, who had no part whatever in the scenario as it was acted at the time in question, revealed that three catheters were inserted in Mrs. Thorton during the period of her initial hospitalization: the subclavian catheter in the left portion of her chest; the arterial catheter in the right arm; and the peripheral catheter in one or both hands from time to time. The arterial catheter was removed by Nurse Martin on November 20, 1982. The peripheral catheter was capped on November 22, 1982. As a result, the only catheter remaining in Mrs. Thornton on November 26, 1982 was the subclavian catheter. when that fact is considered, along with the fact that Mrs. Scott's initial notes, regardless of her current explanation for them, revealed that she removed the CVP catheter (here it should be noted that CVP catheter is, in this case, the same as subclavian catheter), the conclusion is inescapable that she is the individual who removed the subclavian catheter leaving a portion in the patient. There simply is no evidence aliunde Mrs. Scott's own statement that any other catheter remained in the patient on November 26, 1982. This is so notwithstanding the testimony of Mrs. Davis concerning what her deceased aged mother advised happened the day of her discharge. It is difficult to believe that hospital officials would remove a subclavian catheter from Mrs. Thornton on the morning she is released from the hospital and Mrs. Davis' testimony as to that issue is rejected.
