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DEPARTMENT OF HEALTH, BOARD OF MEDICINE vs DAVID R. WEBB, M.D., 00-000764 (2000)
Division of Administrative Hearings, Florida Filed:Tallahassee, Florida Feb. 17, 2000 Number: 00-000764 Latest Update: Dec. 25, 2024
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ALAN LEONARD GETREU vs MENTAL HEALTH COUNSELORS, 90-002043 (1990)
Division of Administrative Hearings, Florida Filed:Tampa, Florida Apr. 02, 1990 Number: 90-002043 Latest Update: Aug. 24, 1990

The Issue Whether Petitioner's application for licensure by examination as a mental health counselor was wrongfully denied.

Findings Of Fact Petitioner attended the University of Tampa and graduated with a degree in social work and psychology in 1978. He subsequently attended Heed University in Fort Lauderdale from 1979 through 1981, graduating in 1981 with a master's degree in counseling psychology. Heed University is not accredited by an accrediting agency approved by the United States Department of Education and was not so accredited while Petitioner was there enrolled. Respondent has worked as a mental health counselor at Tampa Heights Hospital (Exhibit 3), at the Hillsborough Regional Juvenile Detention Center, Charter Hospital, as well as at other facilities, and has served on panels and given lectures at mental health related programs not only in Florida but throughout the United States. Suffice it to say, he has considerable experience as a mental health counselor (Exhibits 4 and 6). At the hearing, Petitioner submitted an original of his transcript at Heed University with impressed seal of the University. This satisfies the objection that Petitioner had not presented an original transcript of his grades at Heed University.

Recommendation It is recommended that Alan Leonard Getreu's application to sit for the mental health counselor licensing examination be denied and this appeal dismissed. ENTERED this 27th day of August, 1990, in Tallahassee, Florida. K. N. AYERS 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 27th day of August, 1990. COPIES FURNISHED: Charles Tunnicliff, Esquire Department of Professional Regulation Northwood Centre 1940 North Monroe Street Suite 60 Tallahassee, FL 32399-0792 Salvatore A. Carpino, Esquire One Urban Center Suite 750 4830 West Kennedy Boulevard Tampa, FL 33609 Linda Biedermann Executive Director Clinical Social Work, Marriage & Family Therapy and Mental Health Counseling Northwood Centre 1940 North Monroe Street Suite 60 Tallahassee, FL 32399-0792 Kenneth D. Easley General Counsel Department of Professional Regulation Northwood Centre 1940 North Monroe Street Suite 60 Tallahassee, FL 32399-0792

Florida Laws (1) 491.005
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CHARLOTTE A. PINKERTON vs FLORIDA DEPARTMENT OF CORRECTIONS, 14-002526 (2014)
Division of Administrative Hearings, Florida Filed:Cocoa Beach, Florida May 28, 2014 Number: 14-002526 Latest Update: May 26, 2015

The Issue Whether Respondent, Department of Corrections, discriminated against Petitioner, Charlotte Pinkerton, on the basis of her age, race, disability, or in retaliation, and, if so, what remedy should be ordered.

Findings Of Fact Respondent is the state agency whose purpose is to protect the public through the incarceration and supervision of offenders, and to rehabilitate offenders through the application of work programs and services. See § 20.315, Fla. Stat. Respondent employs more than 15 persons. Stipulated Facts Petitioner was hired by Respondent and employed at Lake Correctional Institution (Lake C.I.) as a senior registered nurse (RN), OPS2/ employee, effective October 29, 2010. On October 14, 2011, Petitioner was promoted to senior RN, career service employee, at Lake C.I. Petitioner resigned from employment with Respondent at Lake C.I. on February 1, 2013, effective February 15, 2013. Age and Race Petitioner is a 67-year-old Caucasian female. Petitioner was 63 years old when she started work at Lake C.I. There was no evidence presented that a new employee or employees were hired to replace Petitioner. Disability At hearing, Petitioner provided a February 7, 1990, letter from Gene Watson, Ph.D., of The Learning Place, which reflected Petitioner had a diagnosis of developmental dyslexia. Petitioner’s claim that this February 7 letter was attached to her employment application cannot serve as a blanket notification to everyone working for Respondent or Lake C.I. Petitioner admitted she had dyslexia and declared “I can do my job.” Although Petitioner’s former supervisor, senior RN Lou Armentrout, testified she was aware of Petitioner’s dyslexia, the exact timing of this knowledge was not disclosed. Ms. Armentrout also testified that Petitioner did not need an accommodation to perform her nursing duties. Petitioner’s statement that “they knew of my disability” is insufficient to substantiate that fact. Warden Folsom and Dr. Mesa were not employed at Lake C.I. when Petitioner was hired to work there, and they were unaware of Petitioner’s disability. Retaliation Background Prior to the arrival of Dr. Mesa at Lake C.I., Petitioner worked under the direction of the Chief Health Officer (CHO). Petitioner did anything she could to assist the prior CHOs (Dr. Meredith or Dr. Marino). Petitioner worked as a floor nurse and would sometimes be the charge nurse. Petitioner worked in the medical building at Lake C.I. Petitioner’s immediate supervisor was Ms. Armentrout. Petitioner’s six-month performance planning and evaluation by Ms. Armentrout, dated April 16, 2012, reflected a rating of 3.36 on a 5.0 scale. In September 2012, Ms. Armentrout left Lake C.I. Between August 2012 and October 2013,3/ Dr. Mesa served as Respondent’s CHO at Lake C.I. As the CHO, Dr. Mesa oversaw everything in the medical section regarding inmate patient care and services. There are two medical buildings at Lake C.I.: one houses those inmates needing medical care; and a second building houses other inmates needing mental health services. Dr. Mesa would usually start her work day in the medical building and then go to the second building. On a daily basis, Dr. Mesa would treat inmate patients, write orders, interact with staff, attend meetings, and administer Lake C.I.’s entire medical section. Dr. Mesa is a Spanish-speaking female physician who talks with her hands as she speaks. At the start of Dr. Mesa’s tenure at Lake C.I., Petitioner was on light duty as a result of an injured foot. It is believable that Dr. Mesa gave Petitioner orders or directives to do certain tasks which Dr. Mesa believed were within the light duty category. Petitioner contends that she discussed the tasks requested by Dr. Mesa with Respondent’s human resource office, and Dr. Mesa’s requests were found to be outside the light duty category. There was no evidence to support or contradict Petitioner’s discussion with Respondent’s human resource office, and it was hearsay as to what she was told. As the CHO, Dr. Mesa could ask or direct Petitioner to perform medically related tasks. Retaliation In late November 2012, Petitioner claimed she reported to Warden Folsom problems regarding Dr. Mesa’s continued verbal abuse towards Petitioner, medical staffing issues including long work-breaks, and missing medical supplies and equipment. Warden Folsom does not recall this November meeting with Petitioner, and there was no investigation conducted in late November or December regarding Petitioner’s allegations. After reporting the irregularities in the medical section, Petitioner felt Dr. Mesa increased her verbal abuse towards Petitioner. Petitioner felt she was being retaliated against and tortured by Dr. Mesa. Petitioner deemed the abuse to be a hostile work environment, yet she did not report it again until February. Petitioner testified that Assistant Warden Young spoke with her several days after the alleged November meeting with Warden Folsom, and reminded her that she needed “to follow the chain of command.” Assistant Warden Young failed to provide any insight into this meeting, claiming that he did not recall talking with Petitioner about following the chain of command. Petitioner believed that Dr. Mesa had the ability to fire her, and Petitioner remained in constant fear of Dr. Mesa. Petitioner felt Dr. Mesa belittled and humiliated her in front of prisoners and other nurses. Petitioner believed that Dr. Mesa intentionally spoke Spanish to other nurses when Petitioner was present.4/ Petitioner believed that Dr. Mesa hated white people, and black people who defended white people. During one interaction between Petitioner and Dr. Mesa, Dr. Mesa stuck her finger between Petitioner’s eyeballs; however, the exact verbal exchange that led to that encounter remains unclear. Dr. Mesa denied making fun of Petitioner or intentionally giving medical orders to nurses in Spanish, when Petitioner was present. However, Dr. Mesa conceded it was possible that she did so, as Spanish is her first language. Dr. Mesa denied ever intentionally putting her finger on Petitioner. Dr. Mesa supervised Ms. Armentrout and her replacement, nurse Isabga, but claimed not to supervise Petitioner. As the CHO in charge of the health care for inmates, it is logical that the CHO would have supervisory duties over all the health care workers, maybe not directly, but certainly through the chain of command. When Dr. Mesa gave or wrote a medical order, she expected a high level of performance from the Lake C.I. staff. Ms. Gadacz, who worked with Petitioner at Lake C.I., did not know Petitioner had a disability. Ms. Gadacz witnessed Dr. Mesa yelling at different times to different people, including Petitioner; but Ms. Gadacz did not believe it was motivated by anyone’s race or age. Although Ms. Gadacz witnessed Dr. Mesa putting her finger on Petitioner’s face, she could not explain the circumstances. Licensed Practical Nurse Theresa Williams worked with Petitioner at Lake C.I. At various times, Ms. Williams observed Dr. Mesa’s interactions with Petitioner, which she deemed to be less than professional. During at least one meeting, with six or seven employees present, Dr. Mesa addressed everyone but Petitioner with respect. When Respondent began the investigation of Petitioner’s complaint (after Petitioner’s resignation), Ms. Williams was interviewed and provided her observations of Dr. Mesa’s treatment of Petitioner. Petitioner’s Resignation On February 1, 2013, Petitioner requested a meeting with Warden Folsom. During this meeting Petitioner initially expressed her desire that nothing be done about what she was going to tell the Warden. Petitioner expressed her frustrations with Dr. Mesa’s verbal abuse and discrimination. At that meeting, Petitioner gave Warden Folsom a resignation letter. The letter provided: I would like to inform you that I am resigning from my position as Senior Register [sic] Nurse for Lake Correction Institution, effective February 15, 2013. Thank you for the opportunities for professional and personal development that you have provided me during the last 28 months. I have enjoyed working for the agency and appreciate the support provided me during my tenure with the Institution. If I can be of any help during this transition, please let me know. Sincerely, [signature] Ms. Charlotte Pinkerton Senior Register [sic] Nurse Warden Folsom was surprised that Petitioner was resigning and provided her with the opportunity to continue to work for Respondent. However, when Petitioner used the phrase “hostile work environment,” Warden Folsom instituted Respondent’s procedures to have the allegation investigated. Dr. Mesa participated in Respondent’s Inspector General’s investigation that ensued after Petitioner left Lake C.I., but couldn’t recall the details. Further, Dr. Mesa testified repeatedly that she did not recall having conversations with other Lake C.I. personnel regarding Petitioner or others. There is evidence that Petitioner and Dr. Mesa do not care for one another; however, the evidence necessary to prove any discrimination is lacking. Following her resignation, Petitioner has attempted to obtain another RN position, but has been unsuccessful. In December 2013, Petitioner sustained an injury which has precluded her from continuing to seek employment.

Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner’s Petition for Relief from an unlawful employment action be dismissed. DONE AND ENTERED this 4th day of March, 2015, in Tallahassee, Leon County, Florida. S LYNNE A. QUIMBY-PENNOCK Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 4th day of March, 2015.

Florida Laws (6) 120.569120.6820.315760.01760.10760.11
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DEPARTMENT OF HEALTH, BOARD OF NURSING vs ESTELLE DOUGLAS, 00-002901PL (2000)
Division of Administrative Hearings, Florida Filed:Orlando, Florida Jul. 14, 2000 Number: 00-002901PL Latest Update: Dec. 25, 2024
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DEPARTMENT OF HEALTH, BOARD OF MEDICINE vs ALBERT R. CIOFFI, M.D., 08-006214PL (2008)
Division of Administrative Hearings, Florida Filed:Lauderdale Lakes, Florida Dec. 12, 2008 Number: 08-006214PL Latest Update: Dec. 25, 2024
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ENCOMPASS HEALTH REHABILITATION HOSPITAL OF ESCAMBIA COUNTY, LLC vs AGENCY FOR HEALTH CARE ADMINISTRATION, 18-000073CON (2018)
Division of Administrative Hearings, Florida Filed:Tallahassee, Florida Jan. 05, 2018 Number: 18-000073CON Latest Update: Mar. 28, 2019

The Issue Whether, on balance, Certificate of Need (CON) Application No. 10945 submitted by Encompass Health Rehabilitation Hospital of Escambia County, LLC (Encompass or Petitioner) to establish a 50-bed comprehensive medical rehabilitation hospital in Service District 1 satisfies the applicable statutory and rule criteria and should be approved or denied.

Findings Of Fact Overview CMR Services CMR Inpatient Services is defined as: An organized program of integrated intensive care services provided by a coordinated multidisciplinary team to patients with severe physical disabilities, such as stroke; spinal cord injury; congenital deformity, amputation, major multiple trauma, fracture of femur (hip fracture); brain injury, polyarthritis, including rheumatoid arthritis; neurological disorders, including multiple sclerosis, motor neuron diseases, polyneuropathy, muscular dystrophy, and Parkinson’s disease; and burns. See Fla. Admin. Code R. 59C-1.039(2)(d). The Florida Legislature has also determined CMR to be a tertiary health service. A “tertiary health service” means: health service which, due to its high level of intensity, complexity, specialized or limited applicability, and cost, should be limited to, and concentrated in, a limited number of hospitals to ensure the quality, availability, and cost- effectiveness of such service. Examples of such service include, but are not limited to, pediatric cardiac catheterization, pediatric open-heart surgery, organ transplantation, neonatal intensive care units, comprehensive rehabilitation, and medical or surgical services which are experimental or developmental in nature to the extent that the provision of such services is not yet contemplated within the commonly accepted course of diagnosis or treatment for the condition addressed by a given service. See § 408.032(17), Fla. Stat. CMR services are a defined benefit of the Medicare program. Federal regulations define the type of patients that are appropriate for hospital-based rehabilitation, as opposed to rehabilitation offered in less intense settings, such as nursing homes. CMR services are designed to take care of patients recovering from acute episodes such as a severe illness, spinal cord injury, trauma injury, brain injury (both traumatic and non-traumatic), stroke, amputation, and the like, all of which limit certain of the patient’s functions for normal life. A CMR facility is required to provide intensive therapy on a consistent basis. A physician is on call 24 hours a day, seven days a week, coupled with 24-hour nursing coverage. The patient must be seen three times a week by a physician. The types of patients eligible to receive CMR services are heavily regulated. The federal Center for Medicare and Medicaid Services (CMS) establishes the admission requirements for CMR facilities and patients. CMS maintains 13 diagnoses to determine which patients are appropriate for receiving CMR Services (the CMS 13). The CMS 13 includes a determination that the patient is able to participate in a minimum of three hours of therapy a day, five days a week. The therapy includes a combination of physical, occupational, and/or speech therapies. The CMS 13 criteria for admission have become much more stringent over time. Whether a patient meets the CMS 13 is a decision within the professional judgment of the medical director of the CMR facility. A CMR facility is required to attest to CMS that 60 percent of the CMR facility’s patients fall within the 13 diagnoses for CMS. Encompass’s Proposal – The CON Application Encompass’s CON application proposes the construction and operation of a 50-bed freestanding rehabilitation hospital in Escambia County, conditioned on the provision of service to Medicaid and indigent populations, and on providing the latest state-of-the-art rehabilitation equipment. Escambia County is in AHCA Service District 1, which includes Escambia, Okaloosa, Santa Rosa and Walton Counties. See § 408.032(5), Fla. Stat. There is no published need for additional CMR beds in District 1. Therefore, in an attempt to justify its proposal in the absence of a published numeric need, Encompass argues that “not normal” circumstances indicate a need for a CMR hospital consisting of 50 beds. Encompass’s determination of need is premised upon its own, and its consultants’, examination of the elderly population, total population, utilization of existing providers, and available CMR beds, as well as upon Encompass’s experience in other markets. Presently, within District 1, there are two existing CMR facilities, West Florida, located in Pensacola, Escambia County; and Fort Walton Beach, located in Destin, Okaloosa County. Between the two providers, there are 78 licensed CMR beds available: West Florida has 58 licensed beds and Fort Walton Beach has 20 licensed beds. An additional 10 beds are in the process of opening at Fort Walton Beach. Both West Florida and Fort Walton Beach submitted written statements of opposition to the requested CON and presented testimony at the public hearing in opposition to the project. Following review and analysis of Encompass’s CON Application, AHCA preliminarily denied the application and determined that, “[b]ased on the application, not normal circumstances were not established to outweigh the absence of published numeric need.” AHCA recommended denial of the Encompass’s CON Application in its State Agency Action Report (SAAR). The Parties Encompass Health Rehabilitation Hospital of Escambia County, LLC Encompass, the applicant, is a limited liability company formed solely for purposes of applying for a CON. Encompass is a wholly owned subsidiary of Encompass Health Corporation. Encompass’s parent corporation, Encompass Health Corporation was formerly known as HealthSouth Corporation, a CMR provider with facilities in Florida. In the CON Application and in the course of this proceeding, Encompass, as the applicant for the CON, utilizes and relies on data from its parent corporation Encompass Health, f/k/a HealthSouth. During the course of the proceedings, the parties tended to refer to the applicant interchangeably as Encompass and HealthSouth. For identification purposes in this Recommended Order, “Encompass” shall refer to the LLC applicant, and the parent corporation shall be referred to as “Encompass Health Corporation.” Encompass Health Corporation is a leading CMR provider that operates 127 CMR hospitals throughout the United States and Puerto Rico. Encompass Health Corporation has significant experience in developing and opening new CMR hospitals and has opened or expanded several hospitals in Florida and other states in recent years. AHCA AHCA is the state agency charged with administering the CON program. AHCA’s determination of “no need” in District 1 was made using a rule-based formula to determine when new CMR beds are needed. AHCA’s rule also recognizes that “special circumstances” may justify approval of additional CMR hospitals, even in the absence of numeric need. West Florida and Fort Walton Beach West Florida and Fort Walton Beach both operate existing CMR units within District 1. Both are also part of the Hospital Corporation of America’s (HCA) North Florida Division. HCA is the second largest provider of hospital-based acute rehabilitation services in the United States. West Florida operates a 58-bed CMR unit within its acute care hospital in Pensacola located in northeast Escambia County. West Florida’s acute care hospital has expanded its services to include a freestanding emergency room in Perdido Bay and expanded pediatric services. West Florida accepts patients from a number of different hospitals in District 1 including facilities affiliated with the Sacred Heart and Baptist Hospital systems in the greater Pensacola area, as well as other hospitals. The facilities associated with Sacred Heart and Baptist Hospital are also trauma centers, which serve as a significant referral course for West Florida. West Florida also receives acute care patients discharged from West Florida in need of CMR services. West Florida currently has approximately 19 full-time nurses. Ten of those RNs are Certified Rehabilitation Nurses, and nine are working to become certified. Fort Walton Beach operates a 20-bed freestanding CMR unit in Destin, Okaloosa County, within District 1. Pursuant to AHCA’s rules, since Fort Walton operated at 80-percent occupancy for more than 12 consecutive months, it applied to AHCA for approval of 10 additional beds. AHCA granted approval for the additional beds, which were set to open in August 2018. The Fort Walton Beach CMR facility is affiliated with Fort Walton Beach Medical Center (Medical Center) located in Fort Walton Beach. The Medical Center has 237 licensed beds and operates a Level II Trauma Center. For calendar year 2017, the Medical Center had approximately 13,600 inpatient admissions; 55,000 outpatient visits; and about 66,000 ER visits. At the same time, Fort Walton Beach CMR Facility had 402 admissions. The Medical Center provides a diverse range of service lines, including cardiovascular; ortho-neuro services, which include orthopedics and spine procedures; stroke; neurological interventions and emergency services. The Medical Center provides both administrative and capital support to Fort Walton Beach. Fort Walton Beach’s nursing staff consists of 25 RNs, two of which are certified rehabilitation nurses, and three of which are certified nursing assistants. Fixed Need Pool In accordance with Florida Administrative Code Rule 59C-1.039(5), twice a year AHCA calculates and publishes a numeric need for additional CMR beds in each of Florida's eleven districts. In determining fixed need for each district, the formula in the rule considers, among other factors, the number of current CMR beds, historical utilization of CMR services and population growth. Rather than setting a target or using statewide use rates, the formula carries local CMR use rates forward in its calculations. Unique factors in each district, such as demographics, cultural influences, and physician referral patterns, result in a wide variation in CMR service utilization between the districts, which influences the results of AHCA’s calculations. For the 2017 batching cycle, application of the Agency's formula determined that District 1 had an excess capacity of CMR beds, and that no additional beds were needed in District 1 for the January 2023 planning horizon. AHCA published the results, but no challenge was filed to the published fixed need pool. Statutory and Rule Review Criteria Section 408.036(1)(f) designates CMR services as a tertiary healthcare service subject to the requirements of CON review. The CON review criteria applicable to this case are found in sections 408.035(1)(a)-(i), 408.037, 408.039, and in rules 59C-1.008, 59C-1.030, and 59C-1.039. Statutory Criteria Section 408.035(1)(a) – The need for the healthcare facilities and health services proposed. In calculating a zero need under applicable rule methodology, AHCA projected a total need for 56 CMR beds for District 1’s year 2023 horizon. The overall utilization rate for CMR services in District 1 at the time Encompass submitted its CON Application was 57.3 percent. Currently, there are 88 licensed beds in District 1, 58 at West Florida, and 20 at Fort Walton Beach, with an additional 10 beds approved at Fort Walton Beach. On a percentage basis, there are approximately 40 percent more CMR beds in District 1 than the projected need for year 2023. Instead of challenging AHCA’s published need of zero, Encompass submitted its CON Application for the construction of a 50-bed CMR hospital in District 1 by asserting that the presence of “not normal” circumstances established need for its proposed hospital. In support of its argument that “not normal” circumstances demonstrate need, Encompass’s CON application asserts a) lack of access, and b) lack of choice, for CMR services in District 1. Regarding lack of access, Encompass contends that a) lower CMR bed supply inhibits access; b) when CMR bed supply expands, CMR admissions increase; and c) referral patterns demonstrate limited access to existing CMR beds. At hearing, all parties presented evidence and testimony of their respective health planners to address whether the above-listed factors claimed by Encompass support a finding of “not normal” circumstances. Each of the above-listed factors is addressed under separate headings, below. Lack of Access Whether Lower CMR Bed Supply Inhibits Access Encompass argues that District 1 has less access to CMR care because, when compared to other districts, District 1 has fewer CMR beds per capita. This argument, however, fails to take into account the differences in CMR services demanded and utilized among districts. Demand is often unique to each district. When the data regarding beds per capita is considered, with the understanding that demand and utilization vary from district to district, the data demonstrates that District 1 is not out of the ordinary. The data for District 1, whether for the population as a whole, or for the population of 65 or older, which uses more CMR services, reflects that the ratio in District 1 is higher than some districts and lower than others. When looking at the 65+ age bracket, District 1 has a ratio of 0.66 CMR beds to every 1,000 persons, compared to the state average of 0.70. Moreover, the average for Florida is inflated due to high ratios in some counties around the state, such as Broward County. Although the need for CMR services is reviewed on a district-wide basis, Encompass proposes to operate its facility in Escambia County. Escambia County has a ratio of 1.12 CMR beds to every 1,000 persons age 65 years and older. Adding the 50 CMR beds requested by Encompass to the existing beds in Escambia County would result in a ratio of two beds for every thousand in population, which is 2.4 times higher than the state average. These ratios do not support a finding that there is inadequate access for CMR services in District 1, and do not demonstrate need. Whether When CMR Bed Supply Expands, CMR Admissions Increase HealthSouth’s examples Encompass urges that increasing the number of available CMR beds will increase CMR utilization in District 1. In support, Encompass presented the testimony of its healthcare planning expert, Ms. Gordon-Girvin, who presented evidence of HealthSouth’s experience in other areas of Florida, such as Ocala and Altamonte Springs. On the other hand, the Intervenors’ expert in health planning and finance, Mr. Sullivan, opined that the answer to low utilization is not to add additional beds. He explained that, while new healthcare facilities may result in additional utilization, that increase can often be explained by aggressive marketing. Mr. Sullivan also noted that the resulting increased utilization of CMR beds over SNF beds does not necessarily mean that those patients are receiving the most appropriate care for their needs. Mr. Sullivan also noted possible detrimental effects to the healthcare delivery system posed by unnecessary utilization of the more expensive CMR services when lower cost SNF services would be more appropriate. Mr. Sullivan’s opinions on this issue are credited. With respect to Ms. Gordon-Girvin’s calculations regarding the increases in usage experienced at HealthSouth’s facilities in Ocala and Altamonte Springs, Mr. Sullivan explained, and Ms. Gordon-Girvin acknowledged, that while that may be true for those facilities, those projects were significantly different than Encompass’s proposal for District 1. In Ocala and Altamonte Springs, HealthSouth placed a facility in a market where there was relatively high utilization of existing providers, or an absence of available beds. In contrast, District 1’s utilization of CMR services is relatively low. Stagnant Use in District 1 The 78 existing beds in District 1, with a current overall utilization rate of 57.3 percent, have not been highly utilized for quite some time. Encompass argues that the utilization rate is artificially low because West Florida denies admission for CMR services to otherwise eligible patients because of medical complexity, physician shortages, and nurse shortages. Encompass argues that the denied admissions to West Florida are “not normal” circumstances that justify Encompass’s proposed project. According to data compiled by Ms. Gordon-Girvin from admission logs for West Florida, in year 2015, West Florida denied admission to 199 potential CMR patients. Of those 199 denials, the logs indicate that 116 were denied because of lack of staff, 76 because of medical complexity, seven for lack of bed availability, and one because the admission would have violated the 60/40 rule which requires that at least 60 percent of patients fall into particular diagnosis categories. For year 2016, the West Florida logs indicate that 216 patients were denied CMR admission; 48 due to lack of staff, 144 because of medical complexity, and 24 for physician choice. At hearing, West Florida adequately addressed its historical admission denials to overcome the implication that there is lack of access or “not normal” circumstances in District 1. It was shown that, even though there may have been a logged “denial” of admission for one day, there were instances of other admissions at West Florida that same day. In addition, the data was insufficient to demonstrate that any of the denied patients did not receive CMR services in District 1 or elsewhere. The evidence does not otherwise support a finding that West Florida artificially capped admissions at its CMR facility. In 2015 and 2016, HCA’s data collection system utilized by West Florida to document admission denials was not as accurate as its current system, and had limited documenting options. As a result, some of the referrals documented as denied admissions were actually postponed admissions for a day or two. HCA has recently developed a much more robust reporting system, which is used by West Florida and Fort Walton Beach. The new reporting system shows that in 2017, only approximately 50 patients were denied because of staffing. While there were a number of admissions denied by West Florida in 2015 and 2016 because of lack of staff, those numbers, when compared to the overall daily census for those years, were not significant enough to demonstrate “not normal” circumstances. Even if they were, the evidence did not show that such constraints exist today. West Florida is now appropriately staffed with physicians and nurses. West Florida employs an inpatient rehabilitation administrator, a director of therapy, a director of nursing, and a director of therapists who manage therapy for inpatient rehabilitation, acute care, and outpatient therapy. Mr. Ulmer as the CEO for West Florida also makes rounds on the CMR unit. West Florida currently staffs two physicians including its medical director, Dr. Verbois and a mid-level provider to assist Dr. Verbois. At the time of the hearing, West Florida was in the process of recruiting another physician. West Florida also expects to begin a graduate medical education program in the summer of 2019, and it is expected that the program director for that program and its residents would also be located at West Florida. It is expected that the program director would spend approximately 50 percent of his or her time in clinical work. West Florida, as typical in the industry, is staffed to meet the expected average daily census. It has developed a float pool of approximately 18 full-time nurses who have been trained to be able to cover for other nurses who may be out for whatever reason. The float nurses assist at West Florida when there is a need for additional coverage. West Florida has also brought in additional travel nurses. In addition, West Florida has an internal escalation process in place to review the cases and ensure the patients get the best care possible. With respect to denied admissions at West Florida based on medical complexity, the evidence was insufficient to show that the denials support a finding of “not normal” circumstances. The evidence was also inadequate to support a finding that Encompass’s program, if approved, would be able to accept the denied patients or would increase access for those patients. Medicare has stringent guidelines for CMR admissions. Accordingly, West Florida does not admit patients that require certain services due to the medical complexity of the patient, especially when the facility does not offer additional services necessitated by the medical complexity of the patient. Whether a patient is appropriate for care in a particular CMR facility is based on the independent professional judgment of the evaluating physician. If a patient’s condition is too medically complex such that the patient requires a level of care not provided at the CMR facility, that CMR facility would not be able to admit the patient. There is nothing “not normal” about a rehabilitation facility, at one time or another, denying admission to patients who are too medically complex. Dr. Verbois, a physiatrist with years of CMR experience, who has been the medical director for West Florida for 18 years, credibly explained her role in reviewing referrals against the CMS criteria for admission. At West Florida, Dr. Verbois uses her professional medical judgment to determine the medical complexity of the patient. Examples of patients that may be denied admission due to the patient’s medical complexity include patients that are not stable and not able to withstand the intense therapy, such as severe burn patients; patients who are being monitored by telemetry; ventilator dependent patients; patients who are hooked to a wall suction; patients with tracheotomy size of 8 or greater; as well as patients who are newly placed on a parenteral nutrition through a central line (total parenteral nutrition or TPN). In addition, patients with a “total assist” functional independence measure are potentially too medically complex, depending on their specific circumstances. Encompass asserts that HealthSouth has a history of accepting medically complex patients as evidence that its proposed facility in Pensacola would be able to accept the patients denied by West Florida due to their medical complexity. Ms. Lori Bedard, regional vice president of operations for Encompass Health for the southeast region, testified as to the experience with HealthSouth accepting high acuity patients including TPN patients, tracheotomy patients, as well as total assist patients. As an example of a measure of the high acuity patients accepted by HealthSouth, Ms. Bedard cited that the HealthSouth Spring Hill facility has a case mix index (CMI) of 1.3. The higher the CMI value, the higher the complexity accepted. While a CMI of 1.3 for HealthSouth’s Spring Hill facility is high, the CMI for West Florida is higher at 1.6. Further, although Ms. Bedard testified generally that HealthSouth takes TPN, tracheotomy patients, and total assist patients, with the exception of the tracheotomy patients, Ms. Bedard did not testify or otherwise address whether HealthSouth accepts all of those types of patients, and she did not testify that Encompass would be able to take all of those types of patients. Encompass did not otherwise explain how it intends to accept the type of patients deemed by West Florida as medically too complex. According to Dr. Verbois, West Florida accepts certain types of TPN patients as well as certain types of total assist patients. In Dr. Verbois’s opinion, which is credited, Encompass would not be able to take the type of patients West Florida denies as too medically complex because those patients simply do not meet the CMS criteria for admission. In sum, Encompass’s reliance on 2015 and 2016 data reflecting a relatively small number of patients not admitted to West Florida does not demonstrate “not normal” circumstances, does not represent the experience at West Florida’s CMR unit today, and does not demonstrate need in District 1 for additional CMR beds. Rather, the evidence shows, and it is found, that there is no need to increase the number of beds. The addition of 10 new beds at Fort Walton Beach further supports this finding. Ratio between CMR beds and SNF beds SNFs, commonly known as nursing homes, serve post-acute patients but do not offer the same intensive rehabilitation offered in a CMR facility. SNFs typically serve a lower acuity patient population than CMRs. Stays in SNF facilities are typically longer than in a CMR facility. Not every patient that benefits from a SNF would be appropriate for treatment in a CMR facility. Encompass asserts that there is an institutional bias for placing patients in nursing homes versus CMR facilities within District 1. According to a ratio analysis presented in the application and explained at the hearing by Ms. Gorden- Girvin, when the ratio of the number of CMR beds as compared to SNF beds increases, the number of hospital discharges to CMS increases. Ms. Gordon-Girvin determined that in District 1 there is a ratio of seven discharges to SNFs for every one discharge to a CMR, as compared to a five-to-one statewide average. According to Ms. Gorden-Girvin, this ratio indicates a demand in District 1 for more CMR services. The methodology utilized for Ms. Gorden- Girvin’s ratio analysis is not a standard health-planning tool for calculating or otherwise demonstrating need for CMR services. Looking at the utilization numbers for SNF facilities versus CMR facilities in District 1 does not demonstrate need or “not normal” circumstances for additional CMR beds or the presence of any barriers to access. The data utilized by Ms. Gordon-Girvin to derive the ratio only showed the recommended discharge and did not indicate why the patient may have been recommended for a SNF instead of a CMR. The evidence was otherwise insufficient to show a causal link between the number of SNF beds and CMR beds and a lack of access to CMR beds. There are several plausible explanations for the larger utilization of SNF facilities, including that there may simply be a greater need for SNF facilities in District 1. As SNFs and CMRs generally serve different populations, the relevance of a comparative ratio between the two in an attempt to justify need is minimal. Instead of looking at the ratio of discharges to the two different types of facilities, the proper ratio to be examined relative to need is District 1’s population to the number of CMR beds, and the proposed location for the requested project. As previously noted, while the need for CMR services is reviewed on a district-wide basis, Escambia County, where Encompass proposes to locate the project, has a ratio of 1.12 CMR beds to every 1,000 persons age 65 years and older. Adding another 50 CMR beds proposed by Encompass would result an inventory of two beds for every thousand in population, which is 2.4 times higher than the state average. Existing ratios indicate adequate access for CMR services in District 1. Whether Referral Patterns Demonstrate Limited Access to Existing CMR Beds In addition to other arguments raised by Encompass regarding access, a chart contained in Encompass’s CON application indicates that only five patients were transferred from West Florida’s acute care unit; virtually no patients were transferred from other acute care hospitals in District 1; and 8,155 patients were transferred from clinics and physician’s offices. The information contained in the CON Application on this point is in error and is, therefore, unpersuasive on the issue of access. Rather, a significant majority of CMR patient referrals in District 1 come from acute care hospitals, other than the facilities affiliated with the CMR units themselves. The three main referral centers for West Florida are the large health providers in Escambia County including Baptist Hospital, Sacred Heart, and West Florida. Fort Walton Beach receives a significant number of referrals from Sacred Heart of the Emerald Coast, an acute care hospital, other facilities in Bay and Escambia counties, and the Fort Walton Beach Medical Center. In 2017, Fort Walton Beach received 50 referrals from the Pensacola area and accepted approximately 20 to 23 of the referred patients. The evidence does not support a finding that there is lack of access for CMR services in District 1. b. Lack of Choice In support of its claim that there is a lack of choice, Encompass maintains that low numbers of CMR beds relative to SNF beds, coupled with HCA’s two facilities having all of the CMR beds in District 1, limits choice, and suppresses market entry. Encompass asserts that additional CMR beds are needed to increase competition and provide choice. However, unlike some other types of healthcare services, CMR services are tertiary services, which, by definition, should be concentrated in a limited number of facilities to ensure quality, availability, and cost-effectiveness. See § 408.032(17), Fla. Stat. (quoted above). Lack of competition for CMR services in District 1 does not support a finding of “not normal” circumstances or otherwise demonstrate need for Encompass’s proposal. 2. Section 408.035(1)(b) – The availability, quality of care, accessibility, and extent of utilization of existing healthcare facilities and health services in the service district of the applicant. Consistent with the finding that there is no need for the 50-bed facility in Escambia County proposed by Encompass, the existing CMR services provided by West Florida and Fort Walton Beach in District 1 are accessible and available. The evidence did not otherwise demonstrate that an award of a CON to Encompass would improve availability or accessibility to quality CMR services in District 1. Of further note, Encompass includes in its application utilization projections based on a hypothetical, which reduces the ratio of SNF to CMR cases from 7:1 to 6:1, rather than directly projecting future CMR demand. Based on this hypothetical ratio, Encompass projects that CMR cases in District 1 will increase from 977 in 2016 to 2,541 in 2023 for a total increase of 160 percent, even though the population growth in this area is only 1.3 percent annually. These are projections that do not accurately reflect utilization and are unrealistically overstated. 3. Section 408.035(1)(c) – The ability of the applicant to provide quality of care and the applicant’s record of providing quality care. Encompass’s CON application accurately describes quality measures that would be utilized by Encompass if its CON application was approved, including quality metric reports that would track lengths of stay, discharges, and patient improvements. The reports would also track accreditation and regulatory compliance. Regarding accreditation, the evidence indicates that, while one of Encompass Health’s facilities in Florida is accredited by the Commission on Accreditation of Rehabilitation Facilities (CARF), Encompass Health has focused on obtaining accreditation for its facilities from the Joint Commission on Accreditation of Health Care Organizations (the Joint Commission). On the other hand, both West Florida and Fort Walton Beach have accreditation from CARF, described by the Intervenors’ expert in CMR administration as intensive and specific to the operations of rehabilitation hospitals and programs related to rehabilitative care. There is no indication that Encompass would seek CARF certification if its program were approved. In fact, Encompass makes no commitment to seek any particular accreditation in its application. However, all of Encompass Health’s Florida facilities are accredited by the Joint Commission, with some holding Joint Commission certifications for various specialty treatment programs. An actual commitment by Encompass to seek accreditation from the Joint Commission or pursue certifications from CARF would have made a stronger showing. Nevertheless, the strength of Encompass Health’s programs and systems available to Encompass, together with Encompass Health’s history of quality care, was sufficient to support a finding that, if approved, Encompass would have the ability to provide quality CMR services. 4. Section 408.035(1)(d) – The availability of resources, including health and management personnel, for project accomplishment and operation. The parties stipulated that Encompass has the funds necessary for capital and operating expenditures for its proposed hospital. Currently, however, Encompass does not have any employees dedicated to staff the proposed facility. While Encompass has a track record of recruiting and retaining rehabilitation liaisons, therapists, nurses, and doctors of physical medicine (physiatry), existing providers in District 1 have experienced difficulty in recruiting physicians and nurses to staff their CMR facilities. If approved, Encompass would face the same challenges in recruiting professional staff. In addition to West Florida and Fort Walton Beach, District 1 currently has at least two major health systems, Sacred Heart and Baptist, along with numerous SNF facilities. Recently, a new SNF facility opened near West Florida, resulting in two nurses leaving West Florida to work at the new facility. The ability to recruit professional staff is negatively impacted by the fact that the area is not a major destination with large airports. In addition, District 1 has a large population of military families that tend to move frequently, leading to more frequent turnover of professional staff than in areas not as affected by military transfers. Although Encompass’s application has a plan outlining recruiting, the plan does not specifically address recruiting difficulties in the Pensacola area. Approval of the application would place further demand on an already limited supply of healthcare staff. 5. Section 408.035(1)(e) – The extent to which the proposed services will enhance access to healthcare for residents of the service district. In addition to the access issues related to need already addressed, rule 59C-1.039(6) provides that geographical access for CMR services “should be available within a maximum ground travel time of 2 hours under average travel conditions for at least 90 percent of the district’s total population.” Current access to existing providers under this standard is sufficient. Moreover, an award of the CON to Encompass will not improve clinical or programmatic access since Encompass does not propose services that are not currently offered in the District at West Florida and Fort Walton Beach. Encompass did not identify any specific subgroup of services that patients are otherwise not able to access from a clinical standpoint. Furthermore, based on the condition in Encompass’s application to serve only 2.25 percent of Medicaid, charity care, and self-pay, coupled with the fact that Encompass’s facilities (or HealthSouth as a whole) do not serve a high percentage of Medicaid or self-pay patients, Encompass will not enhance access to care for indigent or Medicaid patients as it will focus on serving the better paying patients (i.e., Medicare and commercially insured patients). In sum, the evidence did not show that approval of Encompass’s application would improve CMR service access for residents in District 1. 6. Section 408.035(1)(f) – The long-term financial feasibility of the proposal. The parties stipulated that Encompass has the funds necessary to fund the construction and opening of its proposed facility, but did not stipulate to the long-term financial feasibility of the project. Long-term financial feasibility is demonstrated by showing a profit during the projection period, based on reasonable and defensible assumptions and data sources. For this project, Encompass used a three-year time period for its projections. In criticizing Encompass’s projections as unreasonable, the Intervenors’ healthcare finance expert pointed out that Encompass’s projections were based on Encompass Health’s Ocala facility, which is a different operation than the proposal; were not reviewed with Encompass to match its expectations for the facility; used a full first-year example instead of a start-up year; and did not coordinate staffing requirements with Encompass’s expectations for staffing the proposed operations. These criticisms are legitimate. The lack of communication between the experts hired to prepare the application and those who would be responsible for Encompass’s operations was apparent. While all agreed that Encompass Health’s facilities in Florida all experience profitability in their second year of operation, that is not sufficient to show long-term financial feasibility of the proposed facility. In addition, while, because of inflated cost projections, it appears that funds would be available to pay for staffing expected by those who would actually run the facility, even though much different from staffing proposed in the application, the changes between the application and what is expected cannot be ignored. Considering the disconnects between the application and actual expectations, it is concluded that the application financial projections are not based on reasonable and defensible assumptions and data sources so as to provide a reliable basis for determining long-term financial feasibility of the project. 7. Section 408.035(1)(g) – The extent to which the proposal will foster competition that promotes quality and cost-effectiveness. Under this statutory criterion, the consideration is whether there is a need for greater competition to stimulate and promote quality and cost-effectiveness. Considering the fact that District 1’s utilization of existing CMR beds is relatively low at 57.3 percent, it is apparent that the Encompass project will not promote cost-effectiveness, but rather would promote unnecessary duplication of services. Instead of promoting or enhancing quality, approval of the project would add additional pressures on limited staffing resources in District 1 necessary to maintain current staffing and quality. The evidence was otherwise insufficient to show that additional competition would stimulate quality or cost- efficiency. 8. 408.035(1)(h) - The costs and methods of the proposed construction, including the costs and methods of energy provision and the availability of alternative, less costly, or more effective methods of construction. Encompass has not chosen a location for its proposed facility within Escambia County nor does it have a letter of intent in place to purchase a particular parcel. However, the architect that designed the proposed facility and testified regarding estimates of project costs, Fred Frederick, provided undisputed, credible testimony that Encompass can construct its proposed facility up to code and at the costs estimated in the CON application. The number of square feet for the proposed project reflected in the application is consistent with the floor plan Encompass submitted with the application. The estimated cost of $284 per square foot is adequate even if construction does not begin for approximately one year. A 7.9-acre lot is large enough to accommodate the 50-bed design Mr. Frederick created and Encompass’s estimated purchase price of $3 million for 7.9 acres is reasonable. The cost estimates for environmental impact, site survey, site preparation, water, sewer, utility, landscaping, sidewalks and roads, materials, and testing are reasonable and in line with other Encompass Health projects. The architectural fee of $1.3 million, construction supervision of $300,000, other contingencies of $1.15 million, and $3.45 million for equipment reflected on Schedule 1 are reasonable. In sum, all of Encompass’s project costs were reasonably estimated and accurate. 9. Section 408.035(1)(i) – The Applicant’s past and proposed provisions of healthcare services to Medicaid patients and the medically indigent. Encompass’s application includes a condition that states: “Medicaid, Medicaid Managed Care, Charity Care and Self Pay patients will represent a minimum of 2.25 percent of patient days.” Provision of CMR services to only 2.25 percent of services to the self-pay, charity care, and Medicaid population falls well below the other existing providers in the area. For example, Fort Walton Beach provides 16 percent and West Florida provides 12.4 percent of its services to self-pay, charity care, and Medicaid patients. In addition, for the past four years, Encompass Health’s hospitals in Florida combined have provided only 2.8 percent of services to self-pay, charity care, and Medicaid. This is on the low end of the average for the state. These service levels are not favorable to the application. Rule Review Criteria 90. Rules 59C-1.008, 59C-1.030, and 59C-1.039 govern review of CMR CON applications. The provisions of the rules are generally addressed above as to each of the statutory criteria. In addition, Encompass asserts entitlement to the application of the rule preference in rule 59C-1.039(5)(f)2., relative to the provision of service to Medicaid-eligible persons. The CON application proposes to minimally serve Medicaid patients, although, as previously indicated, Encompass’s proposed service levels to self-pay, charity care, and Medicaid patients are low when compared to the levels of those populations currently served by the Intervenors. Adverse Impact In addition to the adverse impact upon recruiting previously discussed, West Florida and Fort Walton Beach provided expert testimony credibly demonstrating the material adverse financial impact that approval of Encompass’s CON application would have on existing providers. Given current CMR utilization levels, the addition of another 50 CMR beds in Escambia County would create an oversupply, negatively impacting the existing providers by reducing the number of referrals. As previously noted, Encompass’s application contains utilization projections that assume dramatic growth in CMR utilization, which are unreasonably overstated. CMR utilization in District 1 is likely to be far slower, and Encompass’s patients would likely come primarily from existing providers. The Intervenors’ expert in health planning and finance, Daniel Sullivan, calculated the number of patients that West Florida and Fort Walton Beach would lose to Encompass should the application be approved under three different scenarios. The calculations were on a District-wide basis, as were the Encompass utilization projections. If Encompass had done their projections on a county basis, the impact on West Florida would be much greater. If Encompass’s projection to serve 1,095 patients in 2023 were accurate, Encompass would need to capture 102 percent of the current market of CMR patients in District 1. Scenario one assumes that 100 percent of these 1,095 cases come from existing providers; scenario two assumes 75 percent of the 1,095; and scenario three assumes that only 50 percent of the 1,095 cases come from existing providers. Even under the most conservative 50-percent estimate, West Florida would lose 322 discharges and Fort Walton Beach would lose 174 discharges. This represents half of each facility’s current volumes and would cause a significant adverse impact on both West Florida and Fort Walton Beach. Any of the three scenarios represents a substantial adverse impact on West Florida and Fort Walton Beach’s programs. The most conservative 50-percent loss under scenario three results in a contribution margin loss of $4.9 million for West Florida and of $2.0 million for Fort Walton Beach. Such losses would be significant and material, both financially and operationally, to the survival of the West Florida and Fort Walton Beach programs. Moreover, if the Encompass application is approved, West Florida and Fort Walton Beach will be forced to bear a disproportionate share of the lower-paying patient population (i.e., Medicaid, self-pay). Encompass’s proposal to serve 2.25 percent of the Medicaid population does not increase financial accessibility and would have a negative effect on financial access to CMR services by prohibiting the existing providers from operating at the same level as they have historically, further discouraging the facilities from adding new services and equipment. Encompass’s CON application should not be approved.

Recommendation Based on the foregoing Findings of Fact and Conclusions of Law it is, RECOMMENDED that the Agency for Health Care Administration enter a final order denying CON Application Number 10495 filed by Encompass. DONE AND ENTERED this 31st day of January, 2019, in Tallahassee, Leon County, Florida. S JAMES H. PETERSON, III 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 31st day of January, 2019.

Florida Laws (8) 120.569120.57408.031408.032408.035408.036408.037408.039 Florida Administrative Code (3) 59C-1.00859C-1.01059C-1.039 DOAH Case (3) 15-1897CON18-0073CON90-7037
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UNIVERSITY COMMUNITY HOSPITAL vs. DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES, 87-004760 (1987)
Division of Administrative Hearings, Florida Number: 87-004760 Latest Update: Dec. 28, 1988

Findings Of Fact Introduction On October 15, 1986 University Community Hospital, Inc. (UCH or applicant), which operates an acute care facility in Tampa, Florida, filed an application with respondent, Department of Health and Rehabilitative Services (HRS), seeking a certificate of need (CON) authorizing approval for a new thirty-bed comprehensive medical rehabilitation (CMR) unit to be established by converting and delicensing thirty medical/surgical beds to CMR beds at an estimated cost of $325,240. As a health care provider, UCH is licensed by and subject to the regulatory authority of HRS. On February 20, 1987, and in conjunction with the above application UCH submitted a written request to HRS seeking exemption of an existing rehabilitation unit from CON review. In its request, UCH represented that its rehabilitation unit was providing CMR services prior to July 1983 and thus was eligible to have those beds grand fathered without the need for CON review. This was because prior to July 1983, HRS did not consider CMR services as a separate specialty requiring a CON. After requesting and receiving additional information from the applicant, HRS issued proposed agency action on September 23, 1987, denying the application for a CON. As grounds, HRS stated that "there is a projected District 5 (sic) surplus of 12 rehabilitation beds in the 1991 planning horizon" and that "Tampa General Hospital's 60 rehabilitation beds were occupied at an 84 percent (occupancy) during the preceding calendar quarter; L. W. Blake's 28 rehabilitation beds were occupied at a 74 percent occupancy for the same period; (and) the district had a combined occupancy of 79 percent which is below the 85 percent occupancy standard." By letter dated October 1, 1987, HRS determined preliminarily that nine existing rehabilitation beds at UCH qualified for an exemption from CON services based on HRS's finding that UCH was operating a nine-bed CMR unit prior to July 1983. This written advice was authored by HRS's administrator of community health services and facilities, Sharon M. Gordon-Girvon. Hillsborough County Hospital Authority is a public agency operating two acute care hospitals in Tampa, Florida, one being the Tampa General Hospital (TGH). Citing a potential adverse effect on its CMR unit if UCH's application was approved, TGH filed a petition to intervene in support of HRS's proposed agency action on November 6, 1987. This petition was granted on December 18, 1987. In addition, on March 8, 1988, TGH requested a formal hearing to contest HRS's preliminary determination that UCH was entitled to nine CMR beds by virtue of having operated the same prior to July 1983. In general terms, TGH asserted that HRS had no authority to grant an exemption, but if it did, UCH did not qualify for one. The two cases were consolidated on May 3, 1988. The Applicant and Protestant UCH is a community hospital that began service to patients on July 15, 1968. Its facility is located at 3100 East Fletcher Avenue, Tampa, Florida. It is managed by a twenty person board of trustees and currently is licensed by HRS for four hundred and four beds offering medical/surgical, diabetes, oncology, pediatric and rehabilitative services. UCH is accredited by the Joint Commission on Accreditation of Hospitals (JCAH). The facility provides health care services in HRS District 6, an artificially created health planning area that includes Hillsborough, Polk, Manatee, Hardee and Highlands Counties. In January 1987, UCH executed a contract with HRS and became a participant in the Medicaid program. As such, it receives reimbursement from HRS for services provided to Medicaid patients. Created by special act of the legislature, the Hillsborough County Hospital Authority operates two public, not-for-profit hospitals in Hillsborough County, those being TGH and Hillsborough County Hospital. TGH is a 770-bed facility providing services within HRS District 6. Since it provides sophisticated services to patients who are on average much more severely ill than patients at community hospitals such as UCH, TGH can be described as a tertiary hospital. Since 1984 TGH has operated a CON-approved and licensed sixty-bed CMR unit connected to its main acute care facility and is the only level one trauma center on the west coast of Florida. Also, TGH is the primary provider of indigent care in the district, carrying a disproportionate share of the indigent care burden. In 1987 alone, its indigent care costs totaled almost $30 million. C. Grandfathering of Beds Prior to July 1983, HRS determined whether there was a need for various types of hospital beds (e.g., general medical/surgical, critical care, psychiatric and rehabilitation) under its general acute care bed need rule now codified as Rule 10-5.011(1)(m), Florida Administrative Code (1987). Thus, prior to July 1983, CMR services were not recognized by HRS as a separate bed category for CON and licensure purposes, and the conversion by a hospital of licensed acute care beds to rehabilitation beds did not constitute a change in service. In January 1982 UCH established a nine-bed rehabilitation unit on the sixth floor of the south wing of its facility. The unit was established because UCH believed there to be a lack of rehabilitation care in the community. These beds came from its licensed medical/surgical inventory. At that time, only TGH offered CMR services in Hillsborough County and had sixteen beds dedicated to that specialty. According to UCH's chief physical therapist, the unit was "full from the first week." In its 1982-83 licensure application, which is a filing that must be made with HRS every two years, UCH reflected that its bed inventory included nine dedicated to rehabilitation care. On May 16, 1983, UCH, through its counsel, inquired of HRS whether a proposal to convert nine more licensed medical/surgical beds to CMR beds at a cost of less than $600,000 would be subject to CON review. 1/ Also, it requested that, in the event HRS determined that a CON was needed, the request letter be treated as a letter of intent. One week later, HRS responded by letter and requested further information. Among other things, HRS asked for "a detailed description of rehabilitative care currently being provided in the nine beds dedicated to rehabilitative use." This information was provided to HRS by UCH by letter dated June 6, 1983. It included a lengthy description of the care being provided in the nine beds dedicated to rehabilitative use. According to the response, UCH was providing, among other things, a "comprehensive rehabilitation service, or intensive care providing a coordinated multi- disciplinary approach to patients with severe physical disabilities." This letter was followed on June 30 by another letter from UCH's counsel advising HRS that it understood HRS's position that a project to change the rehabilitation beds to CMR beds would be subject to CON review and that UCH contemplated no such change in service. Effective June 8, 1983, HRS adopted a rule which prescribed a separate bed need methodology for rehabilitation beds. Effective July 1, 1983, the legislature amended Section 395.003, Florida Statutes (1983), by adding a new subsection (4) which required that all licensees providing rehabilitation services thereafter reflect the number of beds in that category on the face of their hospital license. At the same time, the legislature amended Section 381.706, Florida Statutes (1983), to require CON approval for any change in the number of rehabilitation beds by a provider. Thus, on and after July 1, 1983, CMR services were recognized as a separate bed category for licensure and CON purposes. On July 19, 1983, or after the above changes took effect, HRS advised UCH that, because UCH had not sought accreditation for its rehabilitation unit from the Commission on Accreditation of Rehabilitation Facilities (CARF), and its unit did not meet the minimum size requirements (twenty beds) for a rehabilitation unit under then-existing HRS Rule 10-5.11(24)(c)3.a., Florida Administrative Code (1983), it had concluded UCH was not providing CMR services as defined by its rule. The letter pointed out also that any effort by UCH to establish an eighteen bed unit would require a CON pursuant to the recent change in the general law. Finally, HRS advised UCH that it could "continue to provide rehabilitative care in the existing unit, using the nine (9) medical/surgical beds dedicated for that care" and that it could also "provide rehabilitative care on the third floor and use an additional nine (9) medical/surgical beds." HRS added that such beds would "not be considered to constitute comprehensive medical rehabilitation care and the beds dedicated to such care will be counted as medical/surgical beds." Because of a demand for more rehabilitation beds, UCH made a decision to expand its rehabilitation unit in the winter of 1983-84 from nine to fourteen beds. In August 1984 UCH expanded its unit to eighteen beds. It did not seek HRS's approval for either expansion project because of its interpretation of HRS's letter of July 19, 1983, that CON approval was not necessary for units having less than twenty beds. Responding to the changes in the general law, HRS undertook to inventory the existing rehabilitation beds in the state. To this end, its office of comprehensive planning sent a questionnaire to all hospitals, including UCH, in late 1983 inquiring whether they provided CMR services. To verify the accuracy of the responses, but not for the purpose of determining whether CMR services existed prior to July 1983, HRS checked whether CON authorization had been issued previously to the facility, whether the facility reported CMR services to the newly created Hospital Cost Containment Board, and whether the facility reported CMR beds in its biannual licensure application. In its reply to the questionnaire, UCH reported it had a twenty-bed rehabilitation unit. In 1983, UCH requested that the federal Health Care Financing Administration (HCFA), which operates the federal Medicare program, recognize its rehabilitation services as being exempt from diagnostic related groups (DRG). If the request was approved, this meant that UCH could be reimbursed on a cost-basis for services rendered to Medicare patients in its rehabilitation unit instead of under the DRG system which reimbursed the facility on a flat rate basis regardless of the length of stay of a patient. HCFA granted the request for exemption of the nine beds effective October 1, 1983. On October 1, 1984, HCFA recognized an exemption for eighteen beds. This exclusion was renewed after a subsequent survey of the unit in 1985. When these exemptions were granted, HCFA did not enforce a federal requirement that a facility be licensed for CMR services in order for HCFA to recognize the exemption. In 1984-85, HRS became aware of certain DRG-exempt rehabilitation units in the state that were not licensed by HRS for CMR services. As noted in a later finding, these providers, including UCH, were allowed to seek a CON exemption and demonstrate that they were providing CMR services prior to July 1983. This opportunity was given partly because HCFA began enforcement of its policy that CMR services be licensed by the state before an exemption would be recognized. Indeed, HCFA revoked UCH's exclusion from Medicare's prospective payment system effective October 1, 1987, on the ground UCH's unit was not licensed by the state. It was later reinstated in 1988, for nine beds after HCFA became aware of HRS's preliminary determination on October 1, 1987, that UCH was entitled to a CON exemption. Because of this limited exemption, UCH now accepts no more than nine Medicare patients at any one time in its unit. On March 18, 1985 UCH's chief executive officer, Terry L. Jones, filed with HRS the facility's biannual licensure application which reflected, inter alia, the facility's then current bed utilization. According to UCH's filing, UCH had three hundred sixty medical/surgical beds, twenty-six pediatric beds and eighteen CMR beds. A copy of the application has been received in evidence as TGH exhibit 102. After receiving the application, HRS advised UCH by letter dated April 25, 1985, that "(HRS's) records (did) not indicate 18 comprehensive medical rehabilitation beds... Please explain." In reply to this, Jones advised HRS by letter dated April 29, 1985 that "a copy of our authorization for rehabilitation beds is attached." This "authorization" was a copy of HRS's July 19, 1983 letter. In July 1985 HRS issued License No. 1779 for the continued operation of UCH's facility. In an undated transmittal letter, HRS stated in part: Please be advised that part of the application pertaining to licensure of 18 comprehensive medical rehabilitation beds is hereby denied because you have failed to obtain a Certificate of Need or exemption from review pursuant to Section 381-493 through 381-499, Florida Statutes (F.S.) and Rule 10-5, Florida Administrative Code (F.A.C.). Certification as an excluded unit by the Department of Health and Human Services, Health Care Financing Administration does not eliminate the Certificate of Need requirements. (Emphasis added.) UCH was offered a point of entry to contest this decision. After receiving the above advice, UCH did not request a hearing but simply inquired of HRS as to whether the eighteen beds should be counted under its general medical/surgical bed component. According to UCH, it did not contest the decision because HCFA continued to recognize UCH's unit as being exempt from the DRG's. On May 16, 1986, Jones and HRS's licensure supervisor, John Adams, had a telephonic conversation concerning the status of the eighteen rehabilitation beds. To confirm the substance of this conversation, Jones advised Adams by letter as follows: I wanted to confirm our conversation today regarding our "rehabilitation" beds licensure to avoid any future problems. You suggested that our 18 beds used for rehabilitation are appropriately licensed under medical/surgical. The beds are not Comprehensive Medical Rehabilitation beds and should not be listed under the Rehabilitation section. The beds could be listed under the "Other" category with an explanation that they are medical rehabilitation, but as you suggest, it would probably further confuse the issue. We intend to continue to offer rehabilitation care with these beds, and understand they do not require a C.O.N. as they are not Comprehensive Rehabilitation Beds. (Emphasis added) On or about May 6, 1986, someone at HRS's office of licensure and certification amended UCH's 1985-86 licensure application to reflect eighteen "Rehab" beds instead of eighteen CMR beds as originally recorded on the application by UCH. In early 1986, TGH became concerned that UCH was providing CMR services without the necessary authority from HRS. It voiced these concerns to HRS on several occasions. On April 30, 1986, HRS advised TGH by letter that UCH had "authorization to use eighteen medical/surgical beds for the purpose of rehabilitation of patients in the hospital" but it did "not have approval for a comprehensive rehabilitation center." It added that HRS had been assured by UCH that UCH was not operating a comprehensive rehabilitation center. By letter dated October 6, 1986 TGH's counsel complained again to HRS's secretary that UCH was operating beyond its licensed authority. UCH learned of this complaint and responded by letter to HRS that its unit was established in 1982, nine beds "for rehabilitation purposes" had been approved by HRS in July 1983, and it had received permission to add nine more beds to its unit in 1983 because of its insufficient size (less than twenty beds) and failure to meet CARF standards. On January 4, 1987, responded to UCH's letter and advised that, based upon a site visit, it now believed UCH was providing CMR services. The letter advised further that HRS had erred in 1983 by telling UCH that its rehabilitation unit was exempt from CON review because of its size (less than twenty units). This was because HRS now construed its Rule 10-5.11(24) governing size of units to apply only to proposed CMR units and not existing CMR units. In view of this error, HRS offered UCH the opportunity to request an exemption of its rehabilitation unit from CON review. This prompted UCH's request for exemption for its nine beds dedicated to rehabilitative care prior to July 1983. In March 1987, an on-site inspection of UCH's facility was made by Robert E. Pannell, HRS's consultant for health services and facilities. This visit was prompted by UCH's request for exemption made on February 20, 1987. The results of that visit are reflected in a report and recommendation dated July 31, 1987, and received in evidence as joint exhibit 5. According to the report, UCH was providing CMR services prior to July 1983, and was entitled to an exemption. In reaching that conclusion, Pannell utilized ten criteria developed during the course of previous investigations. Except for the criteria relating to unit size and compliance with CARF standards, which Pannell deemed to be inapplicable, Pannell concluded that UCH satisfied all others. These included the categories of distinct unit, range of services, provision of service prior to June 1983, team approach/team meetings, length of stay over twenty-eight days, separate policies and procedures, types of patients treated and individualized patient goals. These criteria generally track the CMR rule. Pannell's recommendation was reviewed and concurred in by two other HRS administrators, and proposed agency action granting the exemption was issued by HRS on October 1, 1987. The evidence is conflicting as to whether UCH actually provided CMR services as defined in HRS's rule prior to July 1983. This matter is crucial since eligibility for an exemption is contingent on such a showing. The UCH rehabilitation unit was not specifically designed for rehabilitation care and did not satisfy the CARF standards prior to July 1983. Indeed, UCH has been upgrading its program and facilities since that date to comply with those standards. In 1986, UCH requested and received from HRS authorization to make a complete renovation of its sixth floor "rehabilitation unit" at a cost of $300,000. After doing so, the unit satisfied CARF standards and later became accredited by JCAH. 2/ Prior to 1986, UCH's rooms were not designed for rehabilitation care and were like those in any medical-surgical unit. For example, they did not allow wheelchair accessibility, there were no central bathing facilities and the individual bathrooms were not wheelchair accessible. As to the requirement that the unit have separate policies and procedures for rehabilitation services, UCH's policy manual on this subject was not drafted until 1984. As to the requirement that the unit have individualized patient goals, UCH's patients did not have an overall rehabilitation patient care plan prior to July 1983. Rather, there were separate patient goals in separate sections of the medical record pertaining to each discipline, such as physical therapy and nursing. Until the 1986 renovation project was completed, UCH's rehabilitation unit did not have a physical therapy room on the same floor as the patients. Physical therapy, if needed, was provided on the first floor of the facility. Thus, prior to that date, therapy was provided to rehabilitation patients bedside, exactly as medical rehabilitation services are provided bedside to general medical-surgical patients throughout the hospital. Further, the nine beds dedicated to rehabilitative care were mixed in with non-rehabilitative beds so that a semiprivate room might have one dedicated to rehabilitative care and the other used by a patient not receiving that type of service. According to HRS's supervisor of medical facilities, a rehabilitation unit is not considered to be a physically distinct unit unless all patients and support services are in the same area of a floor and not scattered throughout the hospital. In addition, the area devoted to CMR services must house only patients receiving CMR services. There is a distinction between medical rehabilitation services and CMR services. Medical rehabilitation services provided in a hospital setting include such services as physical therapy, occupational therapy and speech therapy and are routinely available to patients in general medical-surgical beds. Further, medical rehabilitation services have neither an integration of the disciplines nor the full-time assignment of the various specialties (e.g., physical therapy, occupational therapy, speech pathology, rehabilitation nursing, social services, psychologist and the like) to the care of the patient. In contrast, CMR services are a specialized, intensive type of rehabilitation service that involve a coordinated, multi-disciplinary approach to a person's disability. Indeed, CMR services are defined by statute to be a "tertiary" service that is specialized and concentrated in a limited number of hospitals to ensure the quality, availability and cost-effectiveness of that service. In summary, there is a marked difference between the two in the level of care and intensity of services. Prior to July 1983 UCH's nine bed unit provided medical, but not comprehensive medical, rehabilitation services to its patients. Application for Additional Beds - Statutory and Rule Compliance Need for New Beds - Subsection 381.705(1)(a), F.S. At hearing, UCH amended its request to seek only twenty CMR beds. If the amended application is approved, UCH will convert and delicense a comparable number of medical/surgical beds from its inventory. There are no capital costs associated with the project. As noted earlier, UCH lies within HRS District 6 which is composed of Hillsborough, Polk, Manatee, Hardee and Highlands Counties. Presently, the only existing CMR units in the District are sixty beds at TGH and twenty-eight beds at L. W. Blake Hospital in Bradenton, Florida. In addition, just prior to final hearing in this cause, Winter Haven Hospital (in Polk County) opened a twenty- four bed CMR unit at its facility giving a total of one hundred twelve beds in the District. The need for new facilities is measured in relation to the applicable district plan and state health plan. The district (local) plan, while having broad policy goals applicable to health planning in general, is nonetheless inapplicable since it fails to address the need for rehabilitation services. Rule 10-5.011(1)(n), Florida Administrative Code (1987), is the HRS specialty bed need rule applicable to CMR services. The methodology has been incorporated into the state health plan and is an important consideration in the evaluation process. Under this rule, the bed need or surplus is projected five years into the future from the application filing year. In this case the so-called planning horizon against which the need for CMR beds is to be tested is July 1991. According to HRS's proposed agency action to deny the application, there is a projected surplus of twelve rehabilitation beds in District 6 in the 1991 planning horizon. In addition, the proposed agency action found that the occupancy rate for TGH's unit was 84 percent during the "preceding calendar quarter," L. W. Blake Hospital had a 74 percent occupancy rate for the same period, and the district as a whole had a combined occupancy rate of 79 percent which is below the HRS 85 percent occupancy standard. Bed need or surplus for the district is calculated by first determining the number of projected acute care discharges, broken down by age group, from hospitals in the district for the horizon year. The rule then sets as a standard 3.9 CMR beds per 1,000 acute care discharges in the target year, with those beds occupied at an average rate of 85 percent, assuming an average length of stay of twenty-eight days. In this case, the formula yielded a gross need for 1991 of one hundred beds. The above targeted bed supply (gross need) was then compared to the actual inventory of existing and approved beds. As indicated in finding of fact 32, the actual inventory of CMR beds in District 6 was one hundred twelve beds thus indicating a surplus of twelve CMR beds. Therefore, no need was shown for UCH's proposed new CMR beds. To this extent, the application is inconsistent with the state health plan. Besides the bed need calculation, Rule 10-5.011(1)(n)2.c.(II) addresses the utilization of existing providers in a second way and provides that, even if the formula produces a need for new CMR beds, no such beds shall be authorized "unless the average annual occupancy rate for all existing comprehensive rehabilitation facilities and units within the Department service district exceeds 85 percent occupancy for the preceding calendar quarter." This standard is somewhat confusing since it uses the phrases "average annual occupancy rate" and "preceding calendar quarter" in the same sentence thereby raising the question of which time period to use. However, HRS's practice is to use the occupancy rate for the preceding calendar quarter when applying the rule to this type of application. Also, it interprets the words "preceding calendar quarter" to mean the quarter preceding the scheduled decision date on the application. Therefore, HRS determined the occupancy rate of existing district providers for the calendar quarter preceding February 27, 1987, which was the scheduled decision date on UCH's application. During this time period, TGH's sixty beds were 84 percent occupied while L. W. Blake's occupancy rate for its twenty-eight beds was 74 percent, or a weighted average of 81 percent. This was below the required district standard of 85 percent. Had HRS used the occupancy data for the calendar quarter preceding the actual decision date of September 4, 1987, the two hospitals still had a weighted average of 81 percent, or well below the necessary rate. Neither calculation includes the twenty-four beds recently opened in Polk County. Thus, occupancy was not at a level to counterbalance the oversupply of CMR beds in District 6. In an effort to show need on another basis, UCH presented evidence concerning those factors enumerated in Rule 10-5.011(1)(n)2.b.(I)-(IV) and substituted more favorable numbers into the formula. To support the use of more favorable formula data, UCH asserted that if actual admissions (4.7) and patient length of stay (35-37 days) were used, the formula would produce a need for forty-six new beds in 1991. It contended also that if national incidence and prevalence rates were applied to the District 6 population, the bed need would be in excess of three hundred. Both calculations are inappropriate since they draw upon factors already taken into account in the rule or are based on erroneous assumptions. As to evidence submitted to support the other factors for determining need, which were not a part of UCH's completed application, UCH likewise made incorrect assumptions or applied incorrect data. Thus, UCH failed to demonstrate any special circumstances that would justify a deviation from the rule methodology. Availability, Efficiency, Appropriateness, Accessibility, Extent of Utilization and Adequacy of Existing CMR Units (Subsections 381.705(1)(b) and (f), F.S. In the last three years, there have been waiting lists for admission to the rehabilitation units at TGH and UCH. However, TGH's waiting list has declined in recent times, and it now intends to intensify its marketing efforts to maintain a high occupancy level. While UCH still had a waiting list as of the time of hearing, UCH has followed the practice of placing some of these patients on the list before they were ready for rehabilitation and before being screened medically and financially to determine if they met admissions criteria. Indeed, even though UCH has experienced 1988, occupancy rates ranging from only 68 percent to 78 percent, it continues to maintain waiting lists and fails to give continual assessment to those lists. UCH's occupancy rate for its eighteen bed unit was 84 percent in 1986 and 86 percent in 1987. If the application is approved, UCH projects an 85 percent occupancy rate for the twenty-bed unit. Prior to August 1985, the unit was generally 85 percent to 90 percent full with a waiting list of three or four patients. However, until a renovation project was completed in 1986, the beds were used as medical rehabilitation beds, and utilization factors before that date are irrelevant. Further, non-licensed CMR beds are not taken into account by HRS in the licensing process. TGH's occupancy was 90.86 percent in 1986 and 88.51 percent in 1987, but the rate has declined in 1988, because of a new CMR facility in an adjoining district (New Port Richey) and a drop in the average length of stay by patients. This decline has occurred even though the demand for rehabilitation services is increasing, and it is not feasible to maintain 100 percent occupancy in a rehabilitation unit because of the way patients are historically admitted on Monday and discharged on Friday. The HRS rule contains a two hour accessibility standard. The standard is not a limitation on facilities but is designed to insure that there are facilities available to the public. The standard requires that CMR services be accessible to 90 percent of the population within two hours driving time. This means that it is not unreasonable to have patients travel up to two hours to access CMR services. In interpreting this rule, HRS includes the availability of CMR beds in adjacent districts that are reasonably accessible. Thus, Districts 5 and 8, which include communities such as Sarasota, St. Petersburg and New Port Richey, are reasonably and economically accessible in adjoining districts. CMR beds that are available, or will shortly become available, include sixty beds in St. Petersburg, forty beds in Clearwater, twenty beds in New Port Richey, and sixty beds in Sarasota. While there was an accessibility problem in the past, this problem peaked in 1986 and has been subsequently alleviated by the rejuvenation of programs in Districts 5 and 6 and the addition of twenty-four beds at Winter Haven Hospital. 3/ District 6 has experienced rapid growth and is expected to continue growing in the future. However, health planning is not done in this state on a geographically ad hoc basis, particularly for tertiary services that are planned on a regional basis. Proximity of a facility to the family of rehabilitation patients is important to the patient's recovery. This is because the training and counseling of the family is an important part of rehabilitative care. Approximately 80 percent of UCH's rehabilitation patients are elderly stroke patients. This makes driving time a significant barrier to the rehabilitation process if the families of the patients are likewise elderly and unable to drive more than a short distance. This was confirmed by the testimony of a local physician who always attempted to place patients in facilities closest to their families. However, because CMR services are not emergency health care services, HRS does not require such services to be accessible within a short drive time. Moreover, besides TGH, most of the other district facilities lie within one hour's driving time from Tampa. As to financial accessibility to CMR services within District 6, TGH provides services to indigents, medicaid and medicare patients and private pay patients. There are also financial incentives to use outpatient services whenever possible. Should UCH's application be denied, patients within District 6 will not experience any problems in obtaining CMR services. Quality of Care - Subsection 381.705(1)(c), F.S. UCH is accredited by the Joint Commission on Accreditation of Health Care Organizations (JCAH). At hearing, HRS expressed no concern over UCH's ability to provide quality of care. If approved, UCH's twenty-bed unit will meet all criteria in Rule 10- 5.011(1)(n). UCH has agreed to provide all programs and range of services specified by the rule. The unit now meets CARF standards. Finally, UCH has a fully developed referral system. Availability and Adequacy of Existing Providers - Alternatives - Subsection 381.705(1)(d), F.S. There are no alternatives to CMR services for patients who need inpatient comprehensive rehabilitation services. This is because only a CMR unit offers the comprehensive specialized services needed by CMR patients. In this proceeding, UCH does not propose an alternative to CMR services. Rather, it proposes an alternative site from that offered by other CMR providers in the district. Although there is a growing number of comprehensive outpatient rehabilitation facilities (CORF) in the district, these do not provide the same level of care as do CMR units. Availability of Resources, including Manpower - Subsection 381.705(1)(h), F.S. There is a general, overall shortage of specialized staff in the Tampa area. However, UCH does not have any problem attracting and keeping qualified staff for its eighteen-bed rehabilitation unit or finding qualified physical therapists to provide rehabilitation services. This was confirmed by HRS's administrator of community health services and facilities. Financial Feasibility - Subsection 381.705(1)(i), F.S. The proposed project, if approved, is financially feasible from both an immediate and long-term standpoint. Impact on Costs of Health Care - Subsection 381.705(1)(i), F.S. The evidence is conflicting as to whether the project will impact adversely or favorably upon UCH's costs of providing health care. It is found that the project will have a beneficial effect on UCH's cost of providing health care since the unit provides a positive cash flow and offsets in part its uncompensated indigent care costs. It will also prevent UCH from going into an operating deficit. Provision of Services to Indigents and Medicaid Patients - Subsection 381.705(1)(n)1, F.S. Historically, UCH has not provided a high percentage of care to Medicaid and indigent patients. In its application, UCH proposes a patient mix that includes 2.5 percent indigent care and 2.5 percent medicaid. Also, UCH proposes to screen patients seeking rehabilitation care and deny admission to the unit if they lack a funding source. I. Impact on TGH. TGH's CMR unit is a significant contributor to TGH's overall financial soundness. Admissions, revenues and operating margin from the unit have increased each year. Because of large indigent care costs (which totaled almost $30 million in 1987), TGH depends on cross-subsidization of profits from private paying patients to offset the cost of indigent care and other laudable purposes such as being the primary teaching hospital for the University of South Florida. Therefore, it is necessary that TGH's CMR unit be fully utilized in order to maximize the return on its investment. TGH currently attracts patients from roughly a 72-mile radius and is impacted by providers in District 6 and adjoining districts. UCH's proposed CMR service area will overlap with TGH's existing service area and thus adversely impact on TGH's admissions. Indeed, TGH's profit margin in its CMR unit could be wiped out with a 10 percent drop in the occupancy rate. Around sixty percent of UCH's rehabilitation admissions come from in- house. Virtually none of its patients come from Pinellas or Polk Counties but it does get a significant number from Pasco County. TGH also admits patients from Pasco County and would be adversely affected by this competition.

Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the application for a Certificate of Need and the request for exemption of nine beds be DENIED. DONE AND ORDERED this 28th day of December, 1988, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER 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 28th day of December, 1988.

Florida Laws (2) 120.57395.003
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DEPARTMENT OF HEALTH, BOARD OF NURSING vs DANIEL S. WHITE, C.N.A., 11-004434PL (2011)
Division of Administrative Hearings, Florida Filed:Daytona Beach, Florida Aug. 31, 2011 Number: 11-004434PL Latest Update: Dec. 25, 2024
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