Conclusions THE PARTIES resolved all disputed issues and executed a Settlement Agreement. The parties are directed to comply with the terms of the attached settlement agreement. Based on the foregoing, this file is CLOSED. DONE and ORDERED on this the @ day of Z, Vuctrae. , 2015, in Leon County, Tallahassee, Florida. Filed March 10, 2015 3:08 PM Division of Administrative Hearings A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO A JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A SECOND COPY ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED. Copies furnished to: William M. Blocker, II Medicaid Finance & Health Systems Chief Counsel Agency for Health Care Administration William.Blocker@ahca.myflorida.com (Electronic Mail) Joanne B. Erde, P.A. DUANE MORRIS, LLP 200 South Biscayne Blvd., Suite 3400 Miami, Florida 33131-2318 JErde@duanemorris.com (Electronic Mail) Thomas J. Wallace, Bureau Chief, Medicaid Program Finance Finance and Accounting Health Quality Assurance CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished to _ the above named addressees by electronic mail or inter-office mail on this the re day of L Le ehy , 2015. Richard J. Shoop, Esquire Agency Clerk State of Florida Agency for Health Care Administration 2727 Mahan Drive, MS #3 Tallahassee, Florida 32308-5403 (850) 412-3630/FAX (850) 921-0158
Conclusions THE PARTIES resolved all disputed issues and executed a Settlement Agreement. The parties are directed to comply with the terms of the attached settlement agreement, attached hereto and incorporated herein as Exhibit “1.” Based on the foregoing, this file is CLOSED. DONE and ORDERED on this the GE. day of ach , 2015, in Tallahassee, Florida. Led ELIZABETH DUDEK, SECRETARY Agency for Health Care Administration Final Order Engagement Nos. NH11-039L - NH11-044L Page 3 of 5 A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO A JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A SECOND COPY ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED. Andy Page 2501 Blue Ridge Road, Suite 500 Raleigh, North Carolina 27607 (Via U.S. Mail) Bureau of Health Quality Assurance Agency for Health Care Administration (Interoffice Mail) Stuart Williams, General Counsel Agency for Health Care Administration (Interoffice Mail) Shena Grantham, Chief Medicaid FFS Counsel Agency for Health Care Administration (Interoffice Mail) Agency for Health Care Administration Bureau of Finance and Accounting (Interoffice Mail) Zainab Day, Medicaid Audit Services Agency for Health Care Administration (Interoffice Mail) Kristin Bigham Assistant Attorney General Office of the Attorney General (Via Interoffice Mail) State of Florida, Division of Administrative Hearings The Desoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (Via U.S. Mail) Final Order Engagement Nos. NH11-039L - NH11-044L Page 4 of 5 CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished to orl the above named addressees by U.S. Mail on this the Fin of VA YA re £ , 2015. Richard J. Shoop, Esquire” Agency Clerk State of Florida Agency for Health Care Administration 2727 Mahan Drive, Building #3 Tallahassee, Florida 32308-5403 (850) 922-5873 Final Order Engagement Nos. NH11-039L - NH11-044L Page 5 of 5
Conclusions THE PARTIES resolved all disputed issues and executed a Settlement Agreement after the Agency reviewed additional materials. The parties are directed to comply with the terms of the attached settlement agreement. Based on the foregoing, this file is CLOSED. DONE and ORDERED on this the 30 day of April , 2014, in Tallahassee, Florida. ELIZABETH DYDEK, SECRETARY Agency for Health Care Administration Filed April 4, 2014 11:10 AM Division of Administrative Hearings A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO A JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A SECOND COPY ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED. Copies furnished to: Donald Freeman, Esquire Agency for Health Care Administration (Interoffice Mail) Theodore E. Mack, Esquire Powell & Mack 803 North Calhoun Street Tallahassee, FL 32303 (U.S. Mail) Karen Chang, Chief, Medicaid Program Analysis Zainab Day, Acting AHCA Administrator Finance and Accounting HOA Agency for Persons with Disabilities (Facility) CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished to
The Issue The issue is the reasonableness of the amounts of attorneys' fees and expert witness fees incurred by Arbor Health Care Company in the preparation and presentation of two Motions for Sanctions against Life Care Centers of America, Inc., which were previously granted.
Findings Of Fact In May 1992, Arbor Health Care Company ("Arbor") filed a petition challenging the preliminary decisions of the Department of Health and Rehabilitative Services ("HRS") to deny to Arbor and grant to Life Care Centers of America, Inc. ("Life Care") a certificate of need ("CON") to construct a 120 bed community nursing home in Pinellas County, Florida. On September 15, 1992, Arbor filed with the Division of Administrative Hearings, copies of its First Request For Production of Documents and Notice of Service of Interrogatories to Life Care. Arbor filed a copy of its Second Request For Production of Documents upon Life Care on October 9, 1992, and a Third Request For Production on October 30, 1992. On October 26th, Arbor filed a Motion To Compel Life Care to respond to the First Request and Interrogatories, which had been due on October 15th. The next day Life Care filed a Notice of Service of Answers to Interrogatories. On October 28th, Arbor filed a Motion To Compel Life Care to answer Interrogatory Number 3 of the First Set, which was not answered despite Life Care's Notice of Service of Answers. That motion was granted at a hearing on November 5th, and Life Care was given 5 days to comply. Life Care failed to respond by November 10th and was given notice by Arbor that it would file a Motion For Sanctions if responses were not received by 10:00 a.m. on November 16th. On November 16, 1992, Arbor filed a Motion For Order Granting Sanctions of $250.00 in attorney's fees or to preclude the introduction of evidence related to the unanswered interrogatory. In response to Arbor's First and Second Requests For Production, Life Care filed notice that the documents would be available for review and copying, within twenty-four hours on or after October 23, 1992, at its headquarters in Cleveland, Tennessee. On November 6, 1992, Arbor filed a Motion to Compel Responses to the First and Second Requests for Production asserting Life Care's production to have been incomplete and/or unresponsive. On November 23, 1992, Life Care was ordered to respond to all pending discovery requests by December 4, 1992. Life Care's failure to comply with the Order of November 23, 1992, resulted in the filing by Arbor of a second Motion For Sanctions on January 6, 1993. Both of Arbor's Motions For Sanctions requiring Life Care to pay reasonable attorneys' fees and costs were granted on February 10, 1993, with the requirement that Life Care produce the documents in Tallahassee on Thursday, February 18, or risk the imposition of additional sanctions precluding the introduction of certain evidence at hearing. On February 24, 1993, Life Care filed a Notice of Voluntary Dismissal and the case ultimately was closed upon Settlement Agreement of the remaining parties on June 22, 1993. On March 9, 1993, Arbor filed a Motion For Determination of Amount of Reasonable Expenses, including attorneys' fees in the amount of $15,500 and financial expert fees in the amount of $5,100, supported by affidavit of the attorney and the financial expert. Life Care filed a Response asserting that Arbor's fee request was excessive and unsupported by either a detailed accounting of the fees or independent affidavits. By Order to Show Cause, the undersigned scheduled an evidentiary hearing on the amount of reasonable fees and costs for May 17, 1993. On May 3, 1993, Arbor, with the agreement of Life Care, moved to cancel the evidentiary hearing, although the parties were unable subsequently to resolve the issue between themselves. By notice dated September 22, 1993, Arbor scheduled a hearing on its Motion For Determination of Amount of Reasonable Expenses for Wednesday, October 27, 1993. The testimony of an independent attorney expert that the attorney's fee of $125.00 an hour is below the average is accepted. The testimony of Chris Bentley that the fees billed to Arbor were $125.00 an hour for partners, $100.00 for associates, and that total hours billed for the preparation of and presentation of the Motion For Sanctions exceeded 124 hours over a two month period of time is accepted. That testimony is supported by copies of the law firm's invoices sent to Arbor on January 20, 1993, February 16, 1993, and March 22, 1993, for legal services related to this case rendered by the firm of Rose, Sundstrom and Bentley to Arbor.
Findings Of Fact The Department of Health and Rehabilitative Services (HRS) received a letter of intent (LOI) dated October 21, 1988 from "Ocala Healthcare Associates Joint Venture." That letter of intent provided that the proposed applicant sought to add twenty-five community nursing home beds to its 35 bed facility then under construction, in HRS District 3 in Marion County, Florida. The letter of intent was a prerequisite to filing an application for a certificate of need (CON) authorizing those beds. The October 21, 1988 LOI was accompanied by a "certificate of resolution" of Ocala Healthcare Associates Joint Venture of even date. That resolution was certified by Winston A. Porter. HRS generally does not recognize a joint venture as a legal person or entity capable of applying for and holding a certificate of need, based upon an opinion of its legal counsel and based upon the fact that Chapter 10-5 Florida Administrative Code, at its definition of "applicant" does not include the entity known as a "joint venture." There is no specific prohibition, by statute or rule, against joint ventures holding certificates of need, however, and the Department's witness, Ms. Gordon-Girven also acknowledged that the Department has no specific policy prohibiting issuance of a CON to a joint venture. In any event, on November 23, 1988, "Ocala Healthcare Associates General Partnership" filed an application for a certificate of need pursuant to the previously filed letter of intent. In its letter of December 2, 1988, HRS rejected that application on the basis that "the applicant submitting the application was not the same as the applicant identified in the letter of intent." Upon learning of this, Mr. Winston A. Porter, the owner of the parent entity and chief operating officer of the applicant entity, or general partner, immediately notified HRS that the joint venture named in the letter of intent and the general partnership named in the application were actually one and the same entity and that the use of the term "joint venture" in the letter of intent and resolution was a mere clerical error. In corroboration of this position, in fact, Ocala Healthcare Associates general Partnership (Ocala) had already altered its form from a joint venture to a general partnership by way of "an amendment and conversion of Ocala Healthcare Associates Joint Venture to General Partnership Agreement" entered into and dated December 10, 1987. That conversion agreement had been done at the behest of HRS, based upon its advice to Mr. Porter and Ocala Healthcare Associates, Inc. that the Department did not recognize joint ventures as capable of holding certificates of need. It was thus done to comply with HRS' own requirements. HRS does not license joint ventures to operate nursing homes but does license general partnerships for that purpose. The minimum requirements for the certificate of need application require that the legal name of the applicant and parent corporation be given. Rule 10-5.008(1)(d), Florida Administrative Code quoted below, contains no specific "minimum requirements" regarding how the name of an applicant should be listed on an application nor that it should agree or be the same in all cases as that depicted on the letter of intent. The Rule merely incorporates the application form as to "minimum requirements" by reference. The form, in turn, requires only that the applicant's name be entered, not that the name be the same as that on the letter of intent. Ocala, on its certificate of need application listed its legal name just as it truly is, that is, Ocala Healthcare Associate General Partnership. It, of course, had listed its name by mistake, on the letter of intent as "Ocala Healthcare Associates, Joint Venture." The CON application, however, also indicated that the current general partnership, Ocala Healthcare Associates General Partnership, was indeed the same entity as the former joint venture. Further, HRS was on constructive and actual notice of the change in business form undergone by Ocala at HRS' behest in December, 1987. Be that as it may, however, no rule or policy of the Department specifically states that an application for a CON and the related letter of intent must be filed by exactly the same entity. In fact, however, here the evidence shows that the letter of intent and the application were actually filed by the same entity. The controlling and owning members or partners of Ocala Healthcare Associates General Partnership were listed in the letter of intent, even though it was mistakenly called a joint venture, and were also listed in the application. They were named as, and are, one and the same entities. Further, the minimum requirements depicted in the application form say nothing about the applicant's name and the name depicted in the letter of intent being identical. HRS' position that the letter of intent and the application be identical or filed by the same entity is designed to put potential competitors on notice of who the new attempted market entrant is. Here that purpose was accomplished anyway. Ocala never attempted to mislead anyone by its filing of the letter of intent under the "joint venture" name. The joint venture is owned and controlled by the same entities as the general partnership and the component parts of the joint venture and general partnership are identical. Further, HRS personnel involved with this matter were on notice, both constructively and actually, that the joint venture had been dispensed with and the general partnership had supplanted it. Finally, the agency was not prohibited from notifying Ocala of the apparent discrepancy in the names depicted on the letter of intent and on the application, but it took no such action, even though its certificate of need review personnel were on actual notice that Ocala had altered its business form from that of joint venture to general partnership.
Recommendation Having considered the foregoing findings of fact and conclusions of law, the evidence of record and the candor and demeanor of the witnesses, it is therefore, RECOMMENDED that a Final Order be entered accepting Ocala's application for a certificate of need for comparative review with other applicants in the November 1988 batching cycle. DONE AND ORDERED this 2nd day of June, 1989, in Tallahassee, Leon County, Florida. P. MICHAEL RUFF 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 2nd day of June, 1989. APPENDIX Petitioner's Proposed Findings of Fact: Paragraph 1: Accepted. Paragraphs 2-16: Accepted. Respondent's Proposed Findings of Fact: Paragraph 1: Accepted. Paragraph 2: Accepted. Paragraph 3: Accepted. Paragraph 4: Accepted. Paragraph 5: Accepted. Paragraph 6: Accepted. Paragraph 7: Rejected as contrary to the preponderant weight of the evidence and as subordinate to the hearing officers findings of fact on this subject matter. Paragraph 8: Rejected as to its' material import and as contrary to the preponderant evidence and subordinate to the hearing officers findings of fact. Paragraph 9: Rejected as not material to resolution of the narrow range of issues in this proceeding. COPIES FURNISHED: R. Bruce McKibben, Jr., DEMPSEY AND GOLDSMITH Post Office Box 10651 Tallahassee, FL 32302 Richard H. Patterson, Assistant General Counsel Department of Health and Rehabilitative Services 2727 Mahan Drive Tallahassee, FL 32308 Sam Power, Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, FL 32399-0700 Gregory L. Coler, Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, FL 32399-0700
