Findings Of Fact Based upon the oral and documentary evidence adduced at the final hearing and the entire record in this proceeding, the following findings of fact are made: At all time pertinent to this proceeding, Respondent, Jules G. Minkes, was licensed as an osteopathic physician in the State of Florida having been issued license No. OS 001516. There is no evidence that Respondent has ever been the subject of prior disciplinary action by the Petitioner, Department of Professional Regulation, and/or the Board of Osteopathic Medical Examiners. Respondent is certified by the American College of Osteopathic Internists, the American College of Osteopathic Board of Cardiology, the American Osteopathic Board of Nuclear Medicine and the American Board of Nuclear Medicine. Respondent has no advanced or specialized training in dermatology, however, he did complete courses in dermatology as a student and, as part of his primary care practice, he does provide some minor dermatological treatments. At all pertinent times, Respondent was the medical director of South Dade Osteopathic Medical Center d/b/a Suburban Medical Center ("Suburban"). Suburban was a primary care provider facility with International Medical Center ("IMC"), a health maintenance organization ("HMO"). Suburban contracted to become part of the IMC HMO system beginning in June of 1981. Under the IMC system, a patient's primary care physician was the "gatekeeper" four medical services. In the absence of an emergency, a patient was required to first see his primary care physician in order to be referred to other specialized medical care. Conflicting evidence was presented regarding the operation of the IMC program and the procedures for referring patients to specialized medical care and/or physicians who were not part of the HMO network. The IMC referral procedures and the manner of allocating the costs of specialized treatment were not the same at all IMC facilities and were changed several times during the early and mid 1980's. (Certain pertinent aspects of the referral process are explored in more detail in Findings of Fact 37 below.) IMC developed a network of physicians to whom primary care physicians could refer patients for specialized medical treatment. In accordance with its IMC contract, Suburban was expected to provide all primary medical care for all IMC patients assigned to the center. Respondent and Suburban agreed to refer IMC patients to specialists, hospitals, etc. within the IMC network "unless approval for a nonparticipating facility or a professional is specifically approved by the medical director or executive director of IMC." At all times pertinent to this proceeding, Respondent referred his HMO patients to the IMC specialist network with the expectation that those specialists would either treat the patient or further refer them as necessary. Some IMC affiliated providers entered into "risk" contracts with IMC and were responsible for paying specialists and/or directly negotiating arrangements for those specialists to be compensated. The evidence established that, during the time that the Patient was treated at Suburban, Suburban did not have a "risk" contract with IMC. As set forth on page 4 paragraph 23 of the contract between Suburban and IMC (Respondent's Exhibit 3) IMC paid the specialists attending to Suburban's HMO Medicare patients. In accordance with Suburban's contract, IMC allocated a specific amount per member per month to be deposited into an account and applied towards payments of the specialists. At the end of each quarter of the calendar year, IMC was supposed to distribute any sums remaining in the specialists' account to Respondent. However, during the time the contract was in effect, there were never any funds remaining in the specialists' account at the end of any calendar quarter. Therefore, no funds from this account were ever distributed to Respondent. IMC developed a plan for treating Medicare eligible patients. This program was known as the Gold Plus Plan and required the patient to essentially assign their Medicare benefits to the HMO. All patients who enrolled in the Gold Plus Plan executed an agreement acknowledging that all non-emergency medical treatment had to be provided or arranged for by IMC and that they would be limited to seeing doctors within the IMC network. All patients were advised that they could see a specialist at their own expense or could disenroll from the HMO at any time and return to their prior Medicare status. The Patient, T.G., enrolled in the IMC Gold Plus Plan in July of 1982 and executed the standard agreement. At the time she was first seen at Suburban, T.G. was approximately 68 years old. She was a somewhat difficult patient who frequently complained of numerous minor ailments. In approximately 1978, while she was living in New York, T.G. had a basal cell carcinoma removed from her forehead by a dermatologist. T.G. and her husband, C.G., moved to Florida in approximately 1978. Shortly thereafter, additional lesions appeared on her forehead. The Patient's family physician at the time, Dr. Kenneth Hertz, referred T.G. to a dermatologist, Dr. Darrell Blinski, who biopsied the lesions in August of 1981. The pathology report from the biopsy contained a diagnosis of "basal cell carcinoma; both side margins are involved. The deep margin is clear." Involvement of the surgical margins of a biopsy indicates the basal cell carcinoma has spread to the limits of the biopsy and perhaps beyond. On August 22, 1981, T.G. was admitted to coral Reef General Hospital where Dr. Blinski attempted to excise the basal cell carcinoma and performed a Limberg flap procedure to cover the skin defect on her forehead. As a result of the procedure, the Patient had a noticeable scar in the middle of her forehead. Dr. Blinski's admission notes in connection with this August 22, 1981 procedure indicate T.G. had: ... a history of multiple recurrences of basal cell carcinoma of the forehead under treatment in New Jersey and down here... incisional biopsy of a central forehead lesion was done and returned as a basal cell carcinoma, margins involved. The area in question wad in the central forehead. The physical examination revealed an ulcerated lesion measuring 2 mm x 5 mm in the central forehead with a scarred area to the left of that measuring 4 mm in diameter. Involved skin is within 1 cm. Examination of the rest of the facial skin was negative for lesions. A pathology report dated August 27, 1981 on tissue removed during the procedure performed by Dr. Blinski revealed basal cell carcinoma with the "left lateral margin free of tumor, all others surgical margins involved with tumor." In other words, not all of the tumor was removed during the surgery by Dr. Blinski. Dr. Blinski referred the Patient to Dr. Henry Menn for consultation. Dr. Menn was a professor of dermatology and head of the Mohs chemosurgery unit at the University of Miami. In a letter dated September 21, 1981, Dr. Menn advised Dr. Blinski that he thought: It would be best to initiate Mohs Chemosurgery excision of the residual basal cell carcinoma discovered by you in the surgical margins of your excised specimen performed on 27th of August, 1981, from tissue removed from the forehead. In approximately four weeks inflammation and irritation normally present after a surgical flap procedure will be reduced and the chemosurgical excision will be more easily accomplished. Dr. Menn apparently changed his treatment plan for the Patient because, instead of undertaking chemosurgery, he simply followed the patient clinically until the summer of 1982. During that time period, there were no clinical signs of regrowth of the basal cell carcinoma. While primary basal cell carcinoma typically grows in little mounds of cells, recurrent basal cell carcinoma can grow in a different, infiltrative fashion. This type of growth tends to be more subtle and the skin can appear normal for extensive periods of time. T.G. returned to Dr. Menn on December 17, 1981 and, in a letter dated December 21, 1981, Dr. Menn advised Dr. Blinski that: ... about four months have now passed since you excised the large basal cell carcinoma on her forehead. There is no clinical evidence of regrowth of tumor even though the surgical excision margins were involved by tumor after your treatment. Close clinical inspection and palpation do not reveal the evidence of basal cell carcinoma at this time... I will continue to follow the patient at periodic intervals. If there is any evidence of malignancy, I will do an excisional biopsy and initiate chemosurgical treatment as indicated. On March 15, 1982, Dr. Blinski examined the patient and advised Dr. Menn by letter that "there is no recurrence as of this time. She will be followed in four months." By letter dated May 19, 1982, Dr. Menn advised Dr. Blinski "I re- examined our patient [T.G.] on the 18th of May, 1982. I am pleased to report that there is no evidence of regrowth of the skin cancer were [sic] you performed plastic surgery on her forehead... I will continue to follow the patient." On July 22, 1982, T.G. and her husband joined the IMC Gold Plus Plan. Because the Gold Plus Plan required the enrollees to assign their Medicare benefits, T.G. stopped seeing Dr. Menn at this time. T.G. had an appointment with Dr. Menn on October 7, 1982. Dr. Menn's notes indicate that the patient did not appear for her appointment and there is a notation that the "patient wishes to continue care in her HMO." Suburban was the HMO affiliate center to which T.G. was assigned. T.G.'s first visit to Suburban took place on September 3, 1982. During that visit, T.G. advised the Respondent that she had a history of skin cancer. During the physical examination of the Patient, the Respondent noted the scar on her mid-forehead. At the time of the Patient's initial visit to Suburban, the medical records of her prior treatment by Dr. Blinski and Dr. Menn were not available. At some point, those records were obtained by the Respondent. However, it is not clear when the records were received. T.G.'s second visit to Suburban was on September 17, 1982. There is no indication in the medical records of that visit that her forehead was examined. On October 4, 1982, T.G. returned to Suburban and complained to Respondent that her "forehead always feels hot." The Respondent noted a "small left papular swelling 4mm at lower portion of scar-subcut." Under the "assessment" portion of his medical form, Respondent wrote "(1) follow possible recurrence basal cell carcinoma-left lower forehead (2) 1-2mm lesion on right forehead (3) keratotic lesion-right arm." During the October 4, 1982 visit, Respondent hyfercated the lesions on the Patient's right forehead and right arm. Hyfercation is an electrocauterization that burns or desiccates skin lesions by removing the water content of skin cells. Hyfercation destroys tissues and, as a result, the tissue cannot be pathologically diagnosed unless a biopsy is first taken. No biopsy was taken prior to the hyfercation of either of the lesions. Although Respondent has no specialized training in dermatology, he regularly hyfercates skin lesions as part of his office practice. Respondent believes that he has the ability to differentiate between minor, obviously benign skin lesions and those that are more questionable and should be referred to a dermatologist. Respondent noted on the medical records from this visit to "follow for excisional biopsy." That comment was made with respect to the lesion on the Patient's lower left forehead. That lesion was not hyfercated. Instead, the Respondent decided to refer the Patient to a dermatologist in the IMC system for the treatment of that lesion. On October 14, 1982, the Respondent signed the referral form for T.G. to go to the IMC Dermatology Center at a facility known as the Westchester Clinic. An appointment with the IMC dermatologist was scheduled for October 21, 1982. On that day, the Patient was seen by Dr. Seymour Munzer, a dermatologist affiliated with IMC. The exact nature of Dr. Munzer's business relationship with IMC was not established, but he apparently traveled to various IMC Centers to treat patients. During the October 21, 1982 visit, Dr. Munzer noted the Patient's history of surgery for basal cell carcinoma with Dr. Blinski. He noted some nodular firmness above the left brow. His diagnostic impression was "(1) prob. [sic] scar tissue (2) r/o [rule out] recurrent basal cell carcinoma." Patient stated on several occasions that she did not like Dr. Munzer and wanted to see Dr. Menn, her options under the Gold Plus Plan were fully explained to her and she was advised that, under that plan, her treatment would have to be coordinated through the IMC dermatologist. She was also advised that she could see Dr. Menn at her own expense or disenroll from the program and continue her care under traditional Medicare procedures. The Respondent never completed any additional dermatological referral forms for the Patient. While Dr. Munzer claims that a written referral from the primary care physician was necessary every time a patient returned to see him, this testimony is rejected. The more creditable evidence established that Respondent was not required under the IMC system to issue a referral for each visit by a Patient to an IMC specialist. Dr. Munzer biopsied the lesion over the Patient's left brow and submitted it for pathological diagnosis. The pathology report was returned on October 26, 1982 and indicated "basal cell carcinoma, infiltrating. Surgical margins involved by the lesions." T.G. returned to Suburban on November 3, 1982. The records of that visit indicate that the Respondent was waiting for the pathology report. For his assessment, Respondent noted "r/o [rule out] basal cell carcinoma forehead." Respondent's plan was to "follow path report Westchester Center." During the November 3 visit, Respondent removed a 1mm keratotic lesion from the Patient's lower right chin. The Patient returned to Suburban on November 23, 1982. By that time, Respondent had received a copy of Dr. Munzer's report and the pathology report on the biopsy performed by Dr. Munzer. The Respondent discussed the results of the biopsy with the Patient and her husband and explained that she needed to follow up with the dermatologist. While the Patient and her husband have testified that the Respondent advised them that he could treat her basal cell carcinoma, this testimony is rejected. The more creditable evidence established that the Respondent advised the Patient of her need for follow-up by a dermatologist. The Respondent discussed the results of the biopsy with Dr. Munzer by phone and it was his understanding that Dr. Munzer would continue to follow the Patient and provide whatever additional treatment was necessary. The Respondent never received any additional reports or correspondence from Dr. Munzer regarding the Patient. Because the IMC specialists rotated between several hospitals, there was often alot of confusion regarding the paperwork for those patients referred to specialists. It was not unusual for there to be significant delays between the time an IMC specialist saw a patient and the time the specialist's report was sent to the primary care physician. In fact, in many instances such reports were never received. Thus, while Respondent did not receive any further reports from Dr. Munzer, Respondent thought Dr. Munzer and/or IMC was providing treatment for the Patient's basal cell carcinoma as diagnosed in the October 26, 1982 pathology report. No records of the treatment rendered by Dr. Munzer could be obtained from either Dr. Munzer or the Westchester Clinic where Dr. Munzer treated the Patient. It is not clear whether the Patient ever returned to Dr. Munzer for further evaluation or treatment. 1/ However, it is clear that Respondent and his office staff advised the Patient on several occasions that she needed to follow-up with the dermatologist. While the There is no evidence that Dr. Munzer ever developed a plan for treating T.G. Dr. Munzer could not specifically recall his treatment of this Patient except to review his report and the pathology report in Respondent's records. Dr. Munzer testified that he would not have attempted to treat a patient with recurrent basal cell carcinoma on the face, particularly in the area of scar tissue. Instead, he states that he would have recommended either Mohs chemosurgery, referral to a plastic surgeon or possibly radiation therapy. However, it does not appear that Dr. Munzer ever communicated his reluctance to treat such a condition to the Respondent. As far as the Respondent knew, Dr. Munzer and/or the IMC Dermatology Center were capable of treating this Patient. While Dr. Munzer claimed that he did not have authority to refer a patient from an affiliate center for further follow-up, at the very least his input and recommendation would have been essential to determine how to treat a patient with unique dermatological problems. In this case, it does not appear that he ever provided such a recommendation or opinion. Moreover, while Dr. Munzer contends that the Medical Director of an affiliate center was the only person who could make referrals outside the IMC network, Suburban's contract with IMC required such determinations to be made by the Medical Director of IMC. The evidence established that, under Suburban's contract, once a patient was referred to an IMC specialist for treatment, that specialist and IMC were responsible for determining whether to send the patient for additional consultation to a physician outside the IMC network. At no point during the treatment of this Patient did the Respondent attempt to treat the Patient's known basal cell carcinoma. The Patient was next seen by the Respondent on December 7, 1982. The Respondent noted "basal cell carcinoma left-forehead." There is no indication that the Respondent was attempting any treatment for this problem. The Patient was instructed to return in three months. The Patient was treated by the Respondent on February 1, 16, and March 7, 1983 for various ailments and complaints. There is no mention of the Patient's basal cell carcinoma in the medical records of these visits. On April 1, 1983, the Respondent excised a skin lesion on T.G.'s left shoulder. The Respondent submitted the excised lesion for biopsy and the pathology report stated that there was no evidence of malignancy. There is no evidence in the medical records of the April 1, 1983 report that Respondent treated or discussed the basal cell carcinoma on the Patient's forehead. The Patient returned to Suburban on April 4, 6, and May 2, 1983. She was seen by the Respondent during the April 4 and May 2, 1983 visits. The records of those three visits do not reflect any treatment or discussion of the Patient's forehead. The Patient's next visit to Suburban was on May 24, 1983. During that visit, Respondent noted a "2mm keratotic skin lesion, mid forehead." That lesion was high on the forehead near the hairline. It was not in the scar area or adjacent to the previously diagnosed basal cell carcinoma. The Patient wanted the lesion removed for cosmetic reasons and it was the Respondent's opinion that the lesion was not clinically related to the Patient's previous problems. The Respondent felt that the appropriate treatment was to obliterate the lesion and watch for any recurrence rather than to biopsy such a small lesion which appeared benign. His assessment was "keratosis, possible basal cell carcinoma." He hyfercated the lesion and noted to follow it for healing. Because no biopsy was done on this lesion, there is no pathology report available to establish whether or not this lesion was a basal cell carcinoma. Some of the expert witnesses in this proceeding have testified that the Respondent's failure to biopsy this lesion falls below the standard of care expected of a reasonably prudent physician under similar circumstances. However, that testimony presupposes that the lesions was contiguous or adjacent to the prior problem areas. Moreover, even Petitioner's experts admit that a primary care physician such as Respondent should be able to recognize and distinguish cosmetic skin problems from more questionable problems that need closer scrutiny. There is insufficient evidence to disregard Respondent's clinical diagnosis. Even though the Patient had a history of basal cell carcinoma, it was possible, indeed it is likely, that a patient with her history would develop unrelated cosmetic lesions. At the time that the lesion was hyfercated, the Respondent once again advised the Patient that she needed to continue seeing the dermatologist regarding the previously diagnosed basal cell carcinoma. Sometime during the Patient's visits in April or May of 1983, Respondent became aware that the Patient had not been returning to Dr. Munzer for follow-up care of the basal cell carcinoma of her forehead. Until this time, the Respondent had assumed that the Patient was being treated by Dr. Munzer. The Patient reiterated her dislike for Dr. Munzer and also indicated that she did not like the Westchester facility. The Respondent once again explained her options under the HMO plan and advised her of the need to seek specialized care for her basal cell carcinoma. The Patient did not exercise any of the options explained to her and continued to be treated at Suburban through at least March of 1984. During that time, she was treated for various ailments, but no attempt was made to treat the basal cell carcinoma. The Patient's next visit to Suburban took place on June 1, 1983. In addition to treating other unrelated complaints, the Respondent noted that the wound from the hyfercated forehead lesion was healing. The Patient was also treated at Suburban on June 16 and 21, July 7 and 25, August 1 and 9 and October 17, 1983. The Respondent saw the Patient on all of those visits except for the June 16, July 25, and October 17 visits when she was treated by other Suburban employees. There is no indication in the medical records of these visits that the Patient's forehead and/or basal cell carcinoma were treated. The Patient did not appear for scheduled appointments on June 6, July 18, and August 12, 1983. During a visit on November 1, 1983, the Respondent noted a lesion on the Patient's right forehead. This lesion was not contiguous to the Patient's scar nor was it adjacent to the area biopsied by Dr. Munzer. The Respondent hyfercated this lesion. As with the other lesions that Respondent hyfercated, the hyfercation was performed for cosmetic reasons and not because of any medical necessity. Each of the lesions that were hyfercated healed quickly and completely without any sign of regrowth. Because the lesions were hyfercated, biopsies were not possible. The absence of a pathology report precludes a conclusion that none of the hyfercated lesions were malignant. However, the Respondent's testimony that he only hyfercated lesions in areas where no previous problems had occurred and that appeared clinically benign is accepted. Therefore, there was no deviation from the standard of care expected of a reasonably prudent physician. The Patient returned to Suburban on November 8, and 28, and December 14, 1983 and January 13 and 30, 1984. There is no indication that the Respondent saw the Patient on those visits. The Patient was seen by other physicians employed by Suburban. None of those physicians attempted to treat any skin problems and/or the forehead area of this Patient. There is no indication that any of these physicians noted any abnormality on the Patient's forehead. During those visits when the Respondent saw the Patient, the Respondent would typically check her forehead to determine if there were any changes in the scar or the area that Dr. Munzer had biopsied. No changes were evident until the Patient's visit on February 6, 1984. During the February 6, 1984 visit, the Respondent noticed a slight nodularity on the Patient's forehead. Respondent did not attempt to treat that bump. He again recommended to the Patient that she see the dermatologist. The only notation in the medical records was "follow slight nodularity-forehead-hx [history] basal cell CA." The Patient was instructed to return in two weeks. The Patient returned to Suburban on February 7, 13, 27, and March 14, 1984. The Respondent only saw the patient on the February 13 visit. During these visits, she was treated for various unrelated matters and there is no notation regarding her basal cell carcinoma or the nodularity noted on February 6. On March 7, 1984, T.G. transferred to Dr. C.N. House's IMC affiliated provider center. On her first visit to Dr. House on April 6, 1984, T.G. was referred to a dermatologist, Dr. Kenneth Rosen, for a biopsy of her forehead. At the time of this visit, Dr. House did not have any of the Patient's prior records. Dr. Rosen took biopsies from three areas of the Patient's forehead: one from the "right forehead", one from the "mid-forehead", and one from the "mid-forehead above left side." The pathology reports on all three sections indicated basal cell carcinoma that had been incompletely excised. The multiple sites of carcinoma indicate that the tumor was infiltrating. Dr. Rosen advised Dr. House that he was not qualified to treat the Patient. He advised Dr. House that the Patient needed to be referred for Mohs chemosurgery. At the time, the only physician in Miami that Dr. House knew could perform that surgery was Dr. Menn. Mohs chemosurgery, now known as Mohs micrographic surgery, is the treatment of choice for recurrent basal cell carcinomas because of its high cure rate and conservation of healthy skin. Dr. House's contract with IMC was a "risk" contract. Under that contract, the fees for treatment by specialists were directly deducted from his payment from IMC. Dr. House arranged his own network of specialists to whom he would refer patients. As indicated above, the Respondent's contractual arrangement with IMC was different and, at least during the time this Patient was being treated, Respondent only referred patients to the network developed by IMC. Dr. House arranged for the Patient to be seen by Dr. Menn on May 15, 1984. In making this arrangement, Dr. House agreed to personally assume responsibility for Dr. Menn's fees. T.G. was treated by Dr. Menn at the University of Miami with the Mohs Chemotherapy technique in four stages over a period of three days, May 29, 30, and June 1, 1984. The Mohs Surgery revealed an extensive basal cell carcinoma that covered most of the Patient's forehead area. Extensive skin was removed during the surgery and, in some areas, the surgery penetrated to the underlying bone. The surgery reports indicate that all of the area was one continuous basal cell carcinoma of the forehead, the eyelids and the nasal dorsum. Dr. Garland believes that the basal cell carcinoma treated by Mohs Chemosurgery in May of 1984 was the same tumor present and growing at the time that Dr. Menn was seeing this Patient in 1981 and 1982. After the Mohs Surgery, the Patient was referred by Dr. House to Dr. Gary Zahler, an IMC Plastic Surgeon, for repair by skin grafting of the extensive wound to her forehead. After the surgery, the Patient was followed by Dr. Menn until his death in 1985. Dr. Larry Garland, a colleague of Dr. Menn at the University of Miami and a dermatologist specializing in Mohs Chemosurgery and cutaneous oncology, continued following the Patient after Dr. Menn's death. T.G. died from other causes in 1989. She had no recurrence of basal cell carcinoma following the Mohs surgery. The evidence established that the Respondent is a capable and dedicated physician. There is no evidence that the Respondent manipulated the Patient for his own financial gain. It is clear that at the time this case was initiated, there were some erroneous factual assumptions made by at least one expert retained by the Petitioner. Petitioner sent the Patient's medical records for review by Dr. Joseph Rosen. His opinion served as one of the grounds for the initial finding of probable cause in this case and the subsequent issuance of the Administrative Complaint. That opinion was premised on the erroneous assumption that the Respondent never referred the Patient to a dermatologist for treatment. At the hearing in this cause, Dr. Rosen amended his opinion and acknowledged that a referral did take place. However, he felt that the Respondent had still failed to meet the applicable standard of care because he failed to take adequate steps to ensure that the Patient's basal cell carcinoma was treated. This issue is addressed in the conclusions of law below.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Board of Osteopathic Medical Examiners enter a Final Order finding the Respondent, Jules G. Minkes not guilty of the allegations contained in Count I of the Administrative Complaint and dismissing that Count, but finding Respondent guilty of Count II and III, issuing a letter of concern and imposing a fine of $500.00. DONE AND ORDERED in Tallahassee, Leon County, Florida, this 13th day of December, 1990. J. STEPHEN MENTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 13th day of December, 1990.
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found: At all times relevant to this proceeding, respondent, Manihi G. Mukherjee, has been a licensed physician in Florida, holding license number ME 0027749. She received her medical degree in New Delhi, India, in 1965. Respondent is Board certified in obstetrics and gynecology and is a Fellow of the American College of OB/GYN. She attends conferences regularly and has attended more than 150 hours of continuing medical education courses between 1979 and 1987. Since 1976, she has been in private practice in St. Petersburg, Florida, specializing in obstetrics and gynecology. Respondent first saw patient J.B. on November 30, 1979, for a routine gynecological examination and renewal of birth control pills. While obtaining an initial history on the patient, respondent learned that J.B. had a previous appendectomy performed in 1973, and noted the surgical incision located in the right lower quadrant. During a visit to respondent on or about September 9, 1980, J.B. told respondent that she wanted more information' about methods of contraception other than birth control pills. Respondent advised J.B. about the various alternative methods of contraception, including tubal ligation, as well as their effectiveness and complications. With regard to tubal ligation, respondent explained to J.B. that a bilateral partial salpingectomy using a mini-laparotomy could be performed for sterilization purposes and that the failure rate of such a procedure was 4 to 6 persons per 1,000. A laparotomy procedure involves the creation of an incision of about 8 to 10 inches in the anterior abdominal wall. A mini-laparotomy involves a smaller incision of between one and three inches. A salpingectomy is the removal of the fallopian tube. A partial salpingectomy is the removal of a portion of the fallopian tube. A bilateral partial salpingectomy is the partial removal of both fallopian tubes. On or about April 1, 1981, J.B. returned to respondent for a six-month check up, and advised respondent that she wanted to have a tubal ligation. Respondent again advised J.B. about the method of tubal ligation which would be used (the mini-laparotomy with bilateral partial salpingectomy) as well as the complications and failure rates of the procedure. Thereafter, on April 14, 1981, J.B. was admitted to what is now known as Humana Hospital Northside in St. Petersburg Florida, for elective tubal ligation. On that date, she signed a form entitled "Consent to Operation, Administration of Anesthetics, and the Rendering of Other Medical Services," authorizing respondent to perform a mini-laparotomy and a bilateral partial salpingectomy. While obtaining a further medical history from J.B. at the hospital prior to the scheduled surgery, respondent was informed that the patient had previously had an exploratory laparotomy in 1973, at the same time that the appendectomy was performed. On or about April 15, 1981, respondent performed a mini-laparotomy and what was described in respondent's records as a "bilateral partial salpingectomy" with a modified Pomeroy procedure on patient J.B. A Pomeroy procedure is a method of sterilization accomplished by picking up a loop of the fallopian tube, clamping across the loop, cutting and removing that portion of the loop above the clamp and ligating, or tying off, the tissue beneath the clamp with catgut sutures. Respondent modified the procedure by using chromic O sutures. In performing the surgery, respondent identified the left tube and ovary and ligated the loop of the tube. She then attempted to locate the right tube and ovary. Respondent visualized a distorted right tube, but did not see a right fimbria or a right ovary. The fimbria is the fringe-like outer end of the fallopian tube. Respondent testified that she assumed that the patient's right ovary and tube had been removed during the patient's previous exploratory laparotomy and/or appendectomy. Respondent sent specimens from what purported to be the right and left fallopian tubes to the pathology department for pathological evaluation. Her dictated operative report describes the following: "Operative Findings: On opening the abdominal cavity, her right tube was blocked, fibrial (sic) end was absent. Right ovary was absent. Left tube and ovary looked normal. Ovaries looked normal. Operative Procedure: . . . Both tubes were identified. They were held in their mid portion with the Bab- cock and transfixed with chromic O catgut suture... The loop of the right and left fallopian tube were transected and sent separately to the lab..." The pathological evaluation was performed on or about April 16, 1981. It revealed that the specimen identified as "Specimen A," which purported to be a portion of the right fallopian tube, contained sections of veins and fibrofatty tissue. Specimen A did not contain tubal matter. Specimen B contained, as expected, a portion of the left fallopian tube. The respondent was advised of the pathology evaluation report, though the time of such advice was not established. Patient J.B. remained hospitalized until April 7, 1981. Shortly after performing surgery on J.B., respondent advised J.B. that during the course of the operative procedure, respondent could not find a right ovary. However, she advised J.B. that there was nothing to worry about and that everything went well. After leaving the hospital, J.B. saw respondent on three more occasions. On April 20, 1981, respondent removed the staples from J.B.'s abdomen. She advised J.B. to remain on birth control pills for healing purposes. On May 15, 1981, and on June 8, 1981, respondent saw J.B. for postoperative visits. At the latter visit, J.B. advised respondent that she would be moving to Louisiana because of her husband's job. At no time did respondent advise J.B. that the pathological evaluation of the specimens submitted from the April 15, 1981, surgery revealed that the specimen purporting to contain a portion of tubal matter from the right fallopian tube did not in fact contain such material. At no time did respondent advise J.B. that respondent believed that the right tube was removed during the previous surgery performed in 1973. Respondent did not advise J.B. that she could become pregnant if the right tube were note properly blocked, and, therefore, that she needed to remain on birth control pills until the matter could be appropriately investigated. Respondent did not advise J.B. of the necessity to "follow-up" on the results of the pathology report by either obtaining records from the 1973 surgery to confirm respondent's belief that the patient's right fallopian tube was previously removed or by performing appropriate testing on J.B. to confirm blockage of the right ovary. On or about June 20, 1981, well after being apprised of the results of the pathological evaluation, respondent dictated a Discharge Summary for the hospitalization of J.B. from April 14-17, 1981. The Discharge Summary provided in pertinent part: Hospital Course: On April 15, 1981, a mini-laparotomy and partial bilateral salpingectomy was performed without any complications under general anesthesia. Postoperatively, the patient did fairly well. She was discharged on the second postoperative day with the advice to be seen in the office in one week. The Discharge Summary contained no reference to the results of the pathological evaluation. It also contains no documentation that respondent believed that the patient's right fallopian tube was removed during the 1973 surgery. On or about September 29, 1981, patient J.B. telephoned respondent's office because her period was two weeks late and a home pregnancy test had given a positive result. J.B. was informed that it was unlikely, but not impossible, that she was pregnant, and that with a tubal ligation procedure, a part of each tube is removed. On or about October 2, 1981, J.B. went to a physician in Louisiana and was determined to be pregnant. On October 7, 1981, she had an elective abortion. Following the termination of pregnancy, a diagnostic laparoscopy and a D & C (a scraping of the uterus) was performed on October 20, 1981. The laparoscopy revealed that the right ovary was present and a cyst was on the ovary. The right fallopian tube was present in its entirety (including the fimbria), was surgically untouched and was otherwise normal. The injection of methylen blue dye revealed that the fallopian tube was open and not blocked. A failed tubal ligation is not in and of itself malpractice or substandard care. However, a reasonably prudent physician, under the circumstances present in this case, should have immediately advised the patient that the possibility existed that one of the tubes had not been properly ligated, and, therefore, the possibility existed that the patient might become pregnant. The patient should have been advised to continue utilizing birth control methods until appropriate investigation could be undertaken to determine the condition of the right fallopian tube. A reasonably prudent physician would have then undertaken appropriate investigation. This could have included either the obtaining of previous medical records to confirm or deny that the right fallopian tube had been removed during the earlier surgical procedures performed in 1973, or the performance of a hysterosalpingogram. This latter procedure is a test which involves the injection of radiographic dye into the uterus and through the tubes. The dye is examined under x-ray to determine whether it flows freely through the fallopian tube or is stopped by blockage or ligation. The respondent admits that the term used in J.B.'s medical records to describe the procedure performed on the patient during her April, 1981, hospitalization was incorrect. Respondent did not perform a bilateral salpingectomy as noted in the Discharge Summary, but instead performed a left partial salpingectomy and excision of the tissue from the right tube. On September 5, 1981, patient R.L., an 18 year old female, was admitted to the emergency room complaining of abdominal pains. After examining the patient, the emergency room physician determined that R.L. was suffering from bilateral lower quadrant tenderness in the abdomen. A pelvic examination revealed bilateral tenderness in the adnexa and tenderness in the cervix. The impression of the emergency room physician was that R.L. had pelvic inflammatory disease (PID). PID is a progress of infection in the reproductive organs which can start in the vagina and spread to the cervix and progress upward to the uterine cavity, continue on outward to the fallopian tubes and involve the pelvis, either by direct continuous spread or through the blood supply and the lymphatics. It may be associated with either a bacterial or a viral type of infection. The emergency room physician ordered several tests to be conducted for the patient, including a complete blood count test. This test revealed that the patient's white blood cell count was 17,500. A normal count is approximately 7,800. R.L.'s white blood cell count was significantly elevated, indicating the presence of an infective process. The emergency room physician contacted the respondent, who agreed to assume the care of patient R.L. Respondent ordered the admission of the patient to the hospital, with a diagnosis of PID with peritonitis. Peritonitis is an inflammation of the peritoneum or lining of the abdomen. Upon admission, the respondent obtained an initial medical history and performed an initial physical examination on R.L. The medical history revealed that the patient had never had children, had been on birth control pills for one and one-half years, and she denied having had sexual intercourse for the past four months R.L. informed respondent that she had started having abdominal pain and a low-grade fever on the morning of the day before and that the pain had become increasingly worse and generalized, associated with some nausea and vomiting. The respondent's examination of the patient's abdomen and a pelvic examination revealed vague distention or bulging of the abdomen, muscle guarding and rigidity. Sluggish bowel sounds were audible, and there was marked tenderness and rebound tenderness in the patient's lower abdomen. The respondent's impression was acute PID with peritonitis. She ordered that R.L. be placed on intravenous fluids, that her vital signs be taken four times a day, that a chest x-ray be given, and that pain medication, aspirin, and antibiotics be administered. The respondent's main objective was to try to resolve the patient's PID conservatively, without performing surgery. R.L.'s daily progression varied with respect to her white blood cell count, her temperature, abdominal tenderness and rigidity, bowel sounds and daily activity between September 5 and 14, 1981. The patient's white blood cell count fell to 13,100 on September 7, and rose to 16,700 on September 9th. Her temperature would rise and fall on any given day. Her abdomen remained distended and rigid until September 12, when she began having less tenderness and better bowel sounds. She showed some improvement in her diet intake and in ambulation. The respondent ordered that various tests and changes of medication be performed between September 6 and 14, 1981. These included a urinalysis, a flat plate x-ray of the abdomen, an ultra sound of the abdomen and changes in antibiotics. On September 10, respondent performed a culdescentesis (the insertion of a needle into the cul-de-sac under general anesthesia), and withdrew ten cubic centimeters of frank pus. On September 11, respondent performed a colpotomy (a procedure in which an incision is made into the cul-de- sac through the upper wall of the vagina, into the peritoneal cavity) in order to drain the cul-de-sac. The patient appeared to improve somewhat after this procedure. On September 14, 1981, respondent requested Dr. Benjamin Abinales to perform a surgical consultation. Dr. Abinales' examination of R.L. on September 14 revealed that R.L.'s abdomen was slightly distended, with marked tenderness. He noted muscle guarding and rebound tenderness, and the presence of peristalsis. Dr. Abinales felt that the patient was suffering from pelvic peritonitis, and recommended that respondent continue the present plan of treatment for several days. If no improvement was evident, Dr. Abinales suggested that exploratory surgery be considered. The patient's condition did not improve after September 14th. Her white blood count value rose to 27,800 and her temperature was as high as 101 degrees on September 15, 1981. E-coli bacteria, usually found in the gastrointestinal system, were revealed from cultures performed on the pus drained during the culdescentesis. On September 16, the responded performed a second colpotomy, again draining frank pus. On September 17, R.L. was administered a new type of antibiotic, and this was changed again on September On September 18, a chest x-ray revealed that there was a possibility of a subphrenic abscess on the left side of the lungs with pleural effusion present. Thereafter, specialists in infectious diseases and pulmonary medicine were consulted. The infectious disease specialist recommended a CT Scan of the abdomen and surgical intervention after the CT Scan results were evaluated. On September 21, 1981, respondent and Dr. Abinales performed an exploratory laparotomy, lysis of extensive intestinal lesions, what was described as "removal of tubovarian abscess from the right side," an appendectomy, drainage of subphrenic abscess on the left side, and peritoneal lavage. The operative description of the exploratory laparotomy demonstrates that there was significant inflammation of the fallopian tube and the ovary on the right side and also significant inflammation of the appendix on the right side. Thus, the etiology of the infection could have been either an appendicitis with perforation or a tubo-ovarian abscess. Patient R.L. recuperated uneventfully after the surgery and was discharged from the hospital on October 4, 1981. Where possible, conservative treatment (non-surgical treatment) is the treatment of choice for PID. This is particularly true for young female patients of child bearing years. The accepted standard of practice for gynecologists is to initially pursue conservative treatment of PID with antibiotic therapy, especially in the presence of peritonitis, for a period of about 72 hours. Generally, if the proper antibiotics are administered, PID responds dramatically within 72 hours. If clinically significant improvement does not occur in that period, other complications, such as appendicitis or abscess formation, should be suspected and exploration of the abdomen surgically is necessary. The extent of surgical intervention required depends, in large part, on the condition of the abdomen as revealed on exploratory laparotomy. While a physician should be concerned about making every effort to preserve the reproductive organs in a young female, the need to preserve the reproductive system must be balanced against the need to preserve the patient's life, particularly where peritonitis exists.
Recommendation Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that respondent Manihi G. Mukherjee, M.D. be found guilty of violating Section 458.331(1) (m) and (t) , Florida Statutes, that she pay a fine o $2,500.00 and that she be placed on probation for a period of three years, with conditions and restrictions to be established by the Board of Medicine relating to her surgical assessment and care of patients and her record keeping. Respectfully submitted and entered this 28th day of September, 1988, in Tallahassee, Florida. Diane D. Tremor, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1500 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 28th day of September, 1988. APPENDIX TO RECOMMENDED ORDER CASE NO. 87-2283 The parties' proposed findings of fact have been fully considered and are accepted and/or incorporated in this Recommended Order, with the following exceptions: Petitioner 7. Rejected as irrelevant and immaterial to the issues in dispute. 13. Rejected as irrelevant and immaterial to the issues in dispute. 40. First sentence rejected as irrelevant. 49. Second sentence rejected as irrelevant. 61(b). Second sentence rejected as unsupported by competent, substantial evidence. 63. Rejected as unrelated to the charges in the Administrative Complaint. Respondent (as to J.B.) 11. Rejected as contrary to and inconsistent with the greater weight of the evidence. 13, 14, 15 and 17. Rejected as contrary to and inconsistent witch the greater weight of the evidence. (as to R.L.) 4. Rejected as unsupported by competent, substantial evidence. First sentence rejected as unsupported by the evidence. Rejected as contrary to the evidence. 9, 10 and 11. Accepted, except with regard to timeliness. 12. Rejected, as contrary to the greater weight of the evidence. COPIES FURNISHED: Stephanie A. Daniel Senior Attorney Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Donald V. Bulleit and Nelly Ehouzam Fowler, White, Gillen, Boggs, Villareal & Banker, P.A. P. O. Box 210 St. Petersburg, Florida 33731 Dorothy Faircloth Executive Director Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Bruce D. Lamb, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750
Findings Of Fact At all times relevant hereto Respondent was licensed to practice medicine in the State of Florida and was issued License No. ME 0027980 (Exhibit 6). During the period 1984-86 Respondent operated Tampa Family Practice Center as Gold Plus HMO. He owned the clinic or at least totally controlled the clinic by closely supervising the doctors who worked for him at the clinic, requiring his approval of all medications prescribed for patients, for any referrals of patients to a consultant, or for hospitalization, all in an attempt to keep costs down. This clinic operated as a family practice clinic, and doctors were required to schedule up to 40 patients per day. No nephrologist or internal medicine specialists worked at the clinic. L. M. received a kidney transplant in 1983 through the aegis of the Tampa Transplant Clinic and, following the transplant, was monitored by the clinic for several months on a routine basis. In 1984, L. M. applied to join Respondent's Gold Plus HMO and was accepted as a patient by Respondent, after L. M. disclosed that he had received a kidney transplant in 1983. L. M.'s reason for joining the HMO was to save money on his medications. L. M. was told by Respondent that the clinic would not normally accept kidney patients, but because L. M. had received a transplant he was no longer considered a renal patient. L. M. was treated at Respondent's clinic for approximately twenty months during which period he was never referred to a nephrologist, nor were L. M.'s medical records requested from the doctors who had treated L. M. following his kidney transplant. At his clinic visits, his temperature, blood pressure and weight were taken, and his prescriptions for the drugs he was taking when he enrolled in Gold Plus were renewed. During the final three months L. M. was treated at Respondent's clinic he lost approximately 40 pounds and started to feel poorly with nausea and lowering of his blood pressure. Despite the lowering of L. M.'s blood pressure, his medication to combat high blood pressure was continued. L. M. also suffered from diabetes and required insulin. Had L. M. been referred to a nephrologist before his condition became critical, blood tests would have shown that the kidneys were not functioning normally and that some of the medications he was receiving were contra- indicated. It would also have shown he needed additional medication. L. M.'s condition deteriorated rapidly, and he "crashed". He was transported to Carrollwood Community Hospital by ambulance as Respondent's patient, but he was not seen at the hospital by Respondent. However, a representative from Respondent's clinic went to the hospital to induce L. M. to sign a paper disenrolling himself from Gold Plus. Despite, or because of, his serious illness at this time, L. M. did not sign the release. As L. M.'s condition appeared critical to the nurses at Carrollwood Community Hospital, the head nurse called Dr. Goldstein, a nephrologist who had treated L. M. before his transplant, to advise him L. M. was a patient in critical condition, and Respondent wasn't providing any help. Dr. Goldstein telephoned Respondent to tell him L. M. should not be at a community hospital where renal patients cannot be adequately treated without dialysis facilities and that L. M. should be transferred to Tampa General Hospital to the care of the renal transplant team. Respondent said he would try to arrange for the transfer of L. M., but needed to work out some financial arrangements. When Dr. Goldstein learned a few hours later that L. M.'s transfer to Tampa General had not been ordered, he again called Respondent to demand that L. M. be transferred to Tampa General. Shortly thereafter L. M. was transferred, and upon his arrival an acute hemodialysis was done. At this time, L. M. had fluid in his lungs, a pulmonary infection, a blood count showing no kidney function and liver damage. Without dialysis L. M. would not have survived. Following his discharge from Tampa General L. M.'s transplanted kidney is working but not as well as it had before the inadequate treatment led to his crash. Because of this setback, L. M. will likely require a regrafting of another kidney in the future. Another patient of Respondent was E. J., an end stage renal patient who, once he enrolled in Gold Plus, was never referred to a nephrologist for consultation, nor were E. J.'s records obtained by the clinic from the nephrologist who had earlier treated E. J. E. J. had been admitted to Carrollwood Community Hospital several times before May, 1985 when he was admitted by Respondent suffering from kidney disease. Shortly after admission, E. J.'s condition deteriorated to the point the nurse became apprehensive for his survival. On the morning of May 22, 1985, the floor nurse was very concerned about E. J. and called in her supervisor. The only treatment that had been ordered by Respondent for E. J. was oxygen to help his breathing. The head nurse observed E. J. to be short of breath and afraid he was dying. She called Respondent to relay the patient's condition and requested Respondent's presence. Respondent repeated this order for oxygen and told the nurse to put Johnson on "no code". The nurse told Respondent that "no code" would not be accepted by the hospital over the phone and that he would have to personally sign the order at the hospital. Respondent told the nurse to call E. J.'s family and have them come to the clinic. When the nurse called Respondent again shortly thereafter, he hung up on her. "No code" is the status reserved for terminally ill patients with no hope of recovery and a very short time to live. "No code" means that emergency measures will not be adopted to keep the patient alive and is ordered only after the doctor has discussed the patient's condition with the family and with the patient if he is capable of understanding, and all agree that is best for the patient. Fearing the patient would die, the nurse then called Dr. Goldstein and requested he look in on E. J. A few minutes later, the nurse again called Dr. Goldstein to request he come as soon as possible. Dr. Goldstein arrived at Carrollwood Community Hospital shortly thereafter. Upon his arrival, Dr. Goldstein found E. J. short of breath but sufficiently alert to say he didn't want to die. Dr. Goldstein recognized that E. J. needed dialysis as soon as possible and arranged to have the patient transferred to St. Joseph Hospital where hemodialysis was performed. E. J. recovered. E. J.'s medical records showed that while under the care of Respondent he had been admitted several times to Carrollwood Community Hospital with the same symptoms, but no nephrologist had ever been consulted on this patient. The patient had been given treatment and prescriptions to treat the symptoms of his problem, but was never referred to a dialysis center for the hemodialysis he needed until the intervention of Dr. Goldstein. No competent evidence was submitted that Respondent told L. M. that he could use no other physician while a member of Gold Plus. The hearsay testimony to this effect was not corroborated by the testimony of L. M. or any other witness who heard such instruction given. Competent evidence was presented regarding Respondent's reluctance to admit patients to hospitals, even for emergencies, and his close monitoring and approving of prescriptions that the doctors working at Gold Plus issued to patients. This evidence clearly demonstrates that Respondent exercised influence on the patients in such a manner as to exploit them for financial gain. A physician trained in family practice only is not competent to treat an end stage renal patient without referring the patient to a nephrologist for consultation. No evidence was submitted that Respondent had training in nephrology other than what he received while in medical school or as an intern. A nephrologist who does not work frequently, if not exclusively, with renal transplant patients is not competent to treat a transplant patient without consultation with a transplant specialist. Changes in the field of transplant and immunosuppressant medications are occurring so rapidly that a physician needs to work in this field almost daily to remain current and qualified to safely treat and monitor such patients.
The Issue Whether Certificate of Need application (Number 9078) for an adult kidney transplantation program, filed by St. Luke's Hospital Association, meets the statutory and rule criteria for approval.
Findings Of Fact The Agency for Health Care Administration (AHCA) is the state agency authorized to administer the Certificate of Need (CON) program for health care facilities and services in Florida. Pursuant to Rule 59C-1.044, Florida Administrative Code, AHCA requires applicants to obtain separate CONs for the establishment of each adult or pediatric organ transplantation program, including heart, kidney, liver, bone marrow, lung, lung and heart, pancreas and islet cells, and intestines transplantations. For purposes of determining the need for organ transplantation services, the State of Florida is divided, by rule, into four service planning areas, corresponding generally with the northern, western central, eastern central and southern regions of the state. St. Luke's and Existing Providers St. Luke's Hospital Association operates St. Luke's Hospital (St. Luke's), a 289-bed, non-for-profit hospital with 17 beds for skilled nursing care and 272 acute care beds. St. Luke's is located on Belfort Road in Jacksonville, Duval County, Florida, AHCA, District 4, organ transplantation service planning area one. Available services at St. Luke's include obstetrics, open heart surgery, neurosurgery, adult bone marrow, and adult liver transplantation. The transplant services have been added during the last six or seven years. The severity of the illnesses and diseases treated at St. Luke's is represented by its relatively high Medicare case weight of 1.7 in 1997, after the addition of relatively low intensity obstetrics services. In 1998, St. Luke's applied for CONs to establish adult pancreas and islet cell, and adult kidney transplant programs. St. Luke's received the CON to establish the pancreas and islet cell transplant program. The application for a CON to establish an adult kidney transplant program is at issue in this proceeding. The parties stipulated that the letter of intent and application, for CON Number 9078, to establish the adult kidney transplant program, were timely filed. Methodist Medical Center, Inc., d/b/a Methodist Medical Center (Methodist) is a 244-bed acute care hospital, serving primarily adults, with special units for diabetes, hospice, and occupational medicine programs. The services do not include either obstetrics or pediatrics. In 1989, Methodist received a CON allowing its establishment of kidney transplant services. Methodist is located approximately one and a half miles north of downtown Jacksonville. Methodist's representatives contend that an additional kidney transplant program in Jacksonville, at St. Luke's, is not needed and will be detrimental to Methodist. St. Luke's, it was argued, will draw from a limited supply of organs and increase Methodist's financial losses. Those losses at Methodist were expected to range between $5 million and $8 million in 1999. Methodist's accountant described the hospital's financial health as poor to critical. The kidney transplant program provides a positive financial contribution at Methodist, largely due to Medicare reimbursements. At the time of the final hearing, Methodist was managed by Shands-Jacksonville, an affiliate of Shands Teaching Hospital and Clinics (Shands) at the University of Florida in Gainesville, and of University Medical Center in Jacksonville (University Hospital). Shands is also located in organ transplant service area one, but Gainesville is in AHCA District 3, not in 4 like Jacksonville. University Hospital is located across the street from Methodist and serves essentially the same inner-city, lower socio-economic population. St. Luke's was first established in the late 1800's. Previously located directly across the street from Methodist, St. Luke's was relocated near the intersection of J. Turner Butler Boulevard at Interstate 95, south of downtown Jacksonville in 1984. In 1987, St. Luke's became affiliated with the Mayo Clinic in Jacksonville (Mayo-Jacksonville). The two facilities share an administrator. St. Luke's receives approximately three- fourths of its admissions from Mayo-Jacksonville physicians. The Mayo-Jacksonville clinic is located approximately 12 miles from St. Luke's at J. Turner Butler Boulevard and Highway A-1-A. The multi-specialty and multi-subspecialty clinic, is staffed by 230 full-time salaried physicians. The governing board of Mayo-Jacksonville reports to the executive committee of its sole corporate member, the Mayo Foundation for Medical Education and Research (Foundation) in Rochester, Minnesota. The Foundation is the parent organization for the original Mayo Clinic in Rochester (Mayo-Rochester) and its affiliated hospitals, St. Mary's Hospital (with 1100 beds) and Methodist Hospital (with 700 to 800 beds), both in Rochester, Minnesota. In addition to the one in Jacksonville, the Foundation has also established a clinic in Scottsdale, Arizona (Mayo-Scottsdale). The Mayo-Scottsdale clinic is affiliated with a local inpatient hospital. Other related organizations include the Mayo Medical School and the Mayo Graduate School of Medicine. Issues Related to Need St. Luke's contends that its transplant surgeons would increase the total number of kidney transplants in Florida, by using less than ideal donor organs and by expanding waiting lists to enhance the possibility of donor/recipient matches. St. Luke's expects to overcome some of the usual limitations on available cadaveric organs because living donors can also be used to provide kidneys. Finally, St. Luke's maintains that a need exists for dual transplant programs, particularity the combination of kidney and pancreas programs. St. Luke's proposes to provide adult kidney transplants as an alternative to life-long dialysis or death for patients suffering from end-stage renal disease. Nationally, the number of dialysis patients increased from 123,822 in 1987 to 287,000 in 1996. The number of patients waiting for kidney transplants increased from 13,000 in 1987 to 41,000 in 1999. The mortality for patients on waiting lists also increased from over 1700 in 1996 to over 2000 in 1997. Due to the large and growing demand for organs, the federal government contracts with the United Network for Organ Sharing (UNOS) to coordinate the allocation of cadaveric organs. UNOS has designated five organ procurement organizations (OPOs) in Florida, one at the University of Florida in Gainesville (the UF OPO), and the others at centers in Orlando, Tampa, Fort Myers, and Miami. When cadaveric organs become available and are retrieved by surgeons from the nearest OPO, UNOS governs the priority in offering the organs. Organs are offered first to the United States military transplant centers, second to potential recipients who are six antigen or "perfect matches," then as paybacks to OPOs who have provided "perfect matches," and finally to various categories of other high-grade matches. After the organ is offered but not taken in the mandatory UNOS sharing hierarchy, the organ becomes available to local programs within the procuring OPO. St. Luke's will participate in the UNOS program for kidneys as it currently does for other organs, and expects to follow the medical protocols established at Mayo-Rochester, where kidney transplants have been performed for 30 years. St. Luke's has included $100,000 in start-up costs for Mayo-Rochester staff to train the St. Luke's staff. In establishing its successful liver transplant program, St. Luke's allocated $75,000 for comparable start-up costs. Rule 59C-1.044(8)(d), Florida Administrative Code, provides for the determination of the need for new programs, in part, based on the number of transplants performed at existing providers, which must exceed 30. An applicant must also provide a reasonable projection of volume, in excess of 15 a year by the second year of the proposed new program. Currently, two adult kidney transplant programs are approved or operational in each of the four service planning areas of Florida: at Shands in Gainesville and Methodist in Jacksonville in the north, which is service planning area one and coincides with the UF OPO; at Southwest Florida Regional in Fort Myers and Tampa General in western central Florida, which is service planning area two; at Florida Hospital in Orlando and Bert Fish Memorial in Volusia County in eastern central Florida, in service planning area three; and at the Cleveland Clinic Florida in Broward County and Jackson Memorial in Miami in the south, in service planning area four. At the time of this hearing, Bert Fish Memorial and the Cleveland Clinic were approved but not operational. The six operational Florida programs increased in volume from 442 transplants in 1994 to 641 in 1997, or an average increase of 13.2% a year. However, recent growth has been less dramatic. Using one year longer to establish a trend, from 1994 to 1998 data, the average annual increase was 9% a year. Kidney transplant volumes ranged, in 1997, from a low of 45 at Southwest Florida to highs of 150 at Jackson Memorial and 162 at Tampa General. From 1994 to 1997, the volume of kidney transplants within service planning area one increased from 35 to 52 at Methodist, and from 106 to 127 at Shands. As the parties stipulated, that volume exceeds the required minimum of 30 transplants at each provider in the service planning area. As also required by rule and stipulated by the parties, there are no new approved but not yet operational providers within service planning area one. Methodist notes that St. Luke's would be the first Florida program approved in a city which already has an existing kidney transplant service. The United States Renal Disease System (USRDS) is a national organization which collects and reports statistics on patients with end-stage renal disease (ESRD). USRDS is divided into regional networks, including Network Seven which is the ESRD Network of Florida, Inc. The Board of Directors of Network Seven adopted the following motion: The Network Seven Board of Directors reviewed the report of the Network's task force regarding the need for additional renal transplant resources for Service Area 1. After a lengthy discussion, the Board unanimously agreed that the Standardized Transplantation Ratio for Florida's Service Area 1 would not justify the establishment of a new stand-alone renal transplant program in this area. However, it agreed that the availability of a multi-organ transplant service (ie: pancreas and kidney) would be beneficial to those ESRD patients in residing [sic] Service Area 1. Two dual organ kidney and pancreas transplant programs are currently located in Florida, at Shands in Gainesville and at Jackson Memorial in Miami. Methodist notes that both are associated with medical schools at teaching hospitals, and are geographically well-suited to serve north and south Florida. Methodist's transplant surgeon who is the medical director of its program, and served on the Network 7 task force, agreed that a kidney/pancreas program is desirable. Apparently, most pancreas transplants are also done with kidneys but not vice versa. Relatively, few kidney/pancreas transplants are performed, although the number has doubled nationally since 1991. In 1997, there were 3 kidney/pancreas transplants at Shands, 3 at Mayo- Rochester and 33 at Jackson Memorial. The low volume of the dual transplant procedures reflected both medical skepticism and the absence of insurance reimbursement for the procedure when it was considered experimental. Having performed six dual transplants for no charge in 1998, Shands has been able to convince a majority of its third-party payors in Florida to pay for the procedure. The federal government, through the Medicare program, also changed its policy and now reimburses for kidney/pancreas transplants. As a result, the number of dual transplants is reasonably expected to increase. No CON is issued, under the Florida system, to authorize the dual kidney/pancreas program only. As Methodist noted, St. Luke's did not offer to condition its CON by limiting itself to a dual transplant program. The standardized transplantation ratio (STR), on which the Network Seven Board relied, is the ratio of first kidney transplants to the expected number based on the estimated national rate adjusted for age. For the four Florida organ transplant service planning areas, the STRs reported by Network Seven are as follows: Region 1 (North) 1.00 Region 2 (West Central) 1.35 Region 3 (East Central) 1.19 Region 4 (South) .66 A STR of 1.0 indicates generally, that a region is performing transplants as expected based on the national average. Therefore, the suggestion that the performance is mediocre is rejected. Methodist supports its argument that no need exists for an additional kidney transplant program at St. Luke's, based on Network Seven's finding that the STR for the region is roughly what should be expected. St. Luke's, however, asserted that the STR could be raised to the level of region two with the approval of a new program. In fact, the approval of a program at the Cleveland Clinic in Broward County, in region four, was supported by Methodist's expert health planner, among others, in part, by the desire to raise the STR. That situation can be distinguished based on geography and the failure in region four to meet expectations, while a better performance than the national average is not to be expected necessarily from the approval of another program in the same city in region one. While the STR is helpful in an analysis of need, Rule 59C-1.044(8)(d), Florida Administrative Code, requires consideration of the projected transplant volume based on the number of end-stage renal disease patients. Basically, these are patients whose kidneys have ceased to function. From June to December 1998, Network Seven estimated that the number of patients with kidney failure in service planning area one increased from approximately 2800 to 3000. Using expected population growth only, not the historical growth rate, St. Luke's conservatively estimated in its CON that number of patients would reach approximately 2900 by the end of the year 2000. Because some patients are not medically appropriate transplant candidates or will, for other reasons, never receive the service, St. Luke's used a ratio of patients to project transplant cases. Using only 20% of patients between ages 14 and 65, St. Luke's reasonably projects a need for over 300 kidney transplant surgeries in service planning area one in the year 2000. Using population increase and the lower historical growth rate of 9.5%, St. Luke's established a need for up to 450 kidney transplants in 2000 in service planning area one. Either number is sufficient to document St. Luke's ability to perform at least 15 kidney transplants by the end of the second year of operation, as required by rule. Methodist's expert further reduced by 40% the number of potential transplant patients to get what the projected to be the actual number of surgeries. This number is intended to take into consideration the limited number of cadaveric organs. The result is, however, unrealistically lower numbers, in the range of the actual number of surgeries currently performed in area one and is, therefore, rejected. In fact, despite the limitations on cadaveric organs, the number of kidney transplants has continued to increase. St. Luke's experience with liver transplants is also evidence of its ability to exceed the minimum number of 15 kidney transplants in the second year of operation. Specifically, St. Luke's expects to perform 15 kidney transplants in the first year, and 30 in the second year. More than double the projected number of Florida residents received liver transplants, 25 or 26 as compared to 12 or 13 cases in the first seven months of that program at St. Luke's. Compared to projections of 15 liver transplants in year one, 30 in year two, St. Luke's transplant surgeons actually performed 113 after 18 months. Significantly, the volume at Shands has also increased based on the annualized volume for the first quarter of 1999. St. Luke's also demonstrated that it is successfully transplanting livers which were rejected by other Florida programs. Currently, the same team of transplant surgeons harvests all abdominal organs, livers, kidneys, and pancreases, but can use only the livers at St. Luke's. The surgeons who perform the liver transplants at St. Luke's will also perform kidney transplants. As a result of the team's aggressive use of organs and recent changes in federal government requirements for notice of potential donors and reimbursement policies, St. Luke's is reasonably expected to assist in expanding the available supply of cadaveric organs and in increasing the number of transplant surgeries. Subsection 408.035(1)(a) - need in relation to district plan The District 4 health plan, developed by the Health Planning Council of Northeast Florida, Inc., includes preferences applicable to the evaluation of St. Luke's application. Preference one applies to applicants who will meet identified needs with acceptable quality in an economical manner. St. Luke's expert conceded that its proposal will be more costly and require longer average lengths of stay when compared to that at Methodist but not as compared to other Florida programs. St. Luke's projected an average length of stay of 7.6 days at $50,123 per case, but the Florida average is 10.5 days at $81,048. No construction is required for implementation of the project which has a total cost of $238,450. Therefore, St. Luke's proposal generally meets the requirements of preference one. Preference two, for applicants who will alleviate a geographic access problem, is not met by St. Luke's. One argument advanced by St. Luke's and rejected is that the existing providers are not using organs at the appropriate rate. Considering 1997 data, Shands and Methodist appear not to accept and use kidneys at the expected rate, as calculated and assigned by UNOS. The reported expected acceptance rate for Methodist is 30.7% in contrast to an actual rate of 11.5%. Shand's assigned expected rate is reported to be 53.8% but its actual rate of acceptance is shown as 37.4%. Corrected UNOS data shows the opposite result, that acceptance rates are higher than expected. UNOS data is inconsistent and inconclusive. In general, the data is so unreliable as to have no significant probative value. St. Luke's meets preference three by caring for HIV positive patients. St. Luke's also demonstrated its access to adequate staff for a kidney transplant program, meeting the requirement of preference four. Methodist questioned St. Luke's failure to list a certified transplant nephrologist on its staff, but physician services are provided by salaried employees of Mayo-Jacksonville. Preference five favors applicants who demonstrate that a new service will not have a significant negative impact on similar facilities. Even though there may be sufficient numbers of kidney disease patients who qualify for and have access to transplants in service area one, the geographic overlap of the programs is an issue of concern related to impact. Methodist primarily serves transplant service area one patients. St. Luke's draws 50% of its patients from Duval and the five surrounding counties, 35% from other areas of Florida, and 15% from elsewhere, primarily Georgia and the southeastern United States, but that also includes 3% of international origin. It is reasonable to expect St. Luke's to maintain approximately the same patient origin mix in a kidney program. This mix will require St. Luke's to perform only 8 kidney transplants on patients from service area one in order to reach the minimum volume requirement of 15 in the second year, which is actually projected for the first year. Currently, 16 Mayo-Jacksonville patients who are on the waiting list for kidney transplants at Methodist would likely receive transplants at St. Luke's if it had a program. Taking into consideration growth and applying a traditional impact analysis, Methodist will lose two to four cases, and Shands will lose nine cases in the first year of a competing program at St. Luke's. With that level of impact, both programs remain substantially above the minimum required by AHCA rule. One expert equated the loss of ten cases from Methodist, to a financial loss of $100,000, after reimbursement deductions and reduced expenses. The overall magnitude of Methodist's financial losses is so great that the loss of the contribution from the kidney transplant program is insufficient to affect the hospital's profitability. Similarly, the loss of nine cases from Shands leaves volume significantly above the minimum required. Methodist and St. Luke's differ in their reliance on cadaveric and living donors, which also should help alleviate any impact of competition for cadaveric organs on the existing program at Methodist. While Methodist uses 50% living donors, St. Luke's projects a more traditional mix of 30% living. It is reasonable to expect that the growth in transplants, and the differences in patient and organ origins will allow Methodist to avoid any detrimental effect from the establishment of a program at St. Luke's. Methodist suggested that the approved program in Volusia County, and to a lesser extent, that in Broward County will also be unable to achieve minimum volumes if a program is established at St. Luke's. Methodist's support for the Volusia County program, however, lends credence to St. Luke's assertion that the geographic overlap is minimal. St. Luke's demonstrated that the number of projected transplants, taking into consideration the approved programs, is considerably lower than the expected numerical increase in surgeries. Projections of 30 at St. Luke's, six at the Cleveland Clinic, and 25 at Bert Fish during the year 2000 are achievable from the projected growth in kidney transplants. The data also indicates that the Florida waiting lists for transplant candidates could and should be expanded. Separate transplant provider lists are coordinated into the organ sharing list maintained by UNOS. Nationally, 150 people for every one million are on waiting lists for kidney transplants. That number, even adjusted to exclude older patients, is double the ratio for the Florida waiting list. Some expansion is reasonably expected as a result of the establishment of a new Florida program. The numbers needed and projected at each program, the differences in projected patient origins, the ability to expand the waiting list and the absence of an adverse impact from the establishment of the liver transplant program at St. Luke's provide some assurance that a kidney transplant program will not be detrimental to the existing providers. Preference six, for applicants who will maximize services to rural county residents, is met by St. Luke's service to surrounding rural areas. In addition to the general health plan preferences for CON applicants, the District 4 health plan includes specific preferences for transplant services. The parties stipulated that preferences one and five for applicants in major population areas (over 250,000) and for pediatric services are not at issue. Specific preference two applies to applicants with relationships with a broad spectrum of other health care providers, including agreements for patient transfers and organ procurement. In response, St. Luke's refers to its active participation in the UF OPO. As Methodist notes, however, a continuation of the existing relationship, with Mayo physicians performing kidney transplants at Methodist, is the most cost- effective and non-duplicative alternative. St. Luke's transplant surgeons will continue to provide coverage for the surgeons at Methodist. Transplant-specific preference three favors applicants who have a significant role in regional and national research efforts, including by government contracts or research grants. Methodist insists that a distinction be made between the well- known work of the Mayo Foundation and that of St. Luke's. The Mayo Foundation divides its services into three major segments - medical care, medical research, and medical education. Research is supported by over $100 million from government agencies and $80 million from the Foundation. Over a thousand residents and fellows are enrolled in Mayo educational programs. Over 75 transplant-specific research projects within the Mayo system are coordinated by a single institutional review board. Admittedly, a non-university facility, St. Luke's does participate in Mayo educational and research activities. Over 60 Mayo-Rochester physicians, residents, and fellows were rotating through Mayo-Jacksonville and practicing at St. Luke's at the time the CON application was filed. St. Luke's separate budget for basic science research also exceeded $10 million for over 200 active research protocols. The medical research building at Mayo-Jacksonville exceeds 80,000 square feet in size. For these reasons, St. Luke's demonstrated that its participation in educational and research activities satisfies the preference. Transplant preference four favors applicants with a specific commitment to provide charity care. In its application, St. Luke's commits to providing 6% of total kidney transplants to Medicaid or charity patients. One expert witness noted that St. Luke's commitment exceeds the statewide volume of 4% Medicaid/charity kidney transplant patients, which was the condition for approval of the Bert Fish CON. Most patients with end-stage renal disease are covered by Medicare. In calendar years 1996-1998, Shands provided over 30% Medicaid and from 4 to 8% charity care. Methodist provided from 9 to 11% Medicaid and approximately 2% charity care. By contrast, St. Luke's provided from .7% to 1.2% Medicaid and just over 2% charity case. St. Luke's meets the preferences by specifying a reasonable commitment for the kidney transplant program, although it has historically provided comparatively insignificant Medicaid and charity care. Since organ transplant service area one includes Districts 1, 2, and 3, as well as 4, St. Luke's and AHCA also considered the local health plans for those districts. Both noted that District 3 has a preference for organ transplant applicants which are teaching hospitals, as defined by Florida Statutes. St. Luke's does not meet that preference. It is not a statutory teaching hospital. On balance, St. Luke's does meet the intent of local health plans preferences and, therefore, the requirements of Subsection 408.035(1)(a), Florida Statutes. Subsection 408.035(1)(b) - increase/improve availability, access, quality of care, efficiency, utilization, and adequacy of like and existing facilities in the district In its application, St. Luke's illustrated the concern for renal patients as follows: End-stage renal disease is a large and growing problem in Florida and north Florida. with 14,168 ESRD patients in Florida and 2,822 ESRD patients in service planning area one during 1998, with 787 Florida residents added to the kidney waiting list during 1997, and with Florida resident deaths due to diabetes growing to 3,828 deaths by 1997, the magnitude of the ESRD problem is evident. St. Luke's Exhibit 1 at p. 96. St. Luke's plans to serve an increasing pool of patients within the District and the service planning area. With its aggressive use of organs, St. Luke's can also increase available cadaveric organs, thus increasing numerically, the accessibility, availability and utilization of kidney transplant services in the district. The efficiency of all providers is also reasonably expected to be enhanced due to the introduction of competition into the market. Currently, the relationship between Methodist and Shands is not competitive. Subsection 408.035(1)(c) - quality of care Modeled after that of the Mayo Clinic Rochester, St. Luke's kidney transplant program will be emulating a program with the nation's best survival rates despite its use of organs which have been rejected by others. St. Luke's is licensed by the AHCA, certified to participate in the Medicare and Medicaid programs, accredited by the Joint Commission on the Accreditation of Health Care Organizations (JCAHO), and certified by UNOS to perform transplants. The parties stipulated that St. Luke's has a history of providing a high quality of care. The evidence also supported a finding that St. Luke's will also provide the same high quality of care in kidney transplantation services, using the same physical spaces, by essentially the same staff. St. Luke's staff will require only specialized kidney transplant training and equipment. Subsection 408.035(1)(d) - available and adequate alternatives An alternative to a new kidney transplant provider is the expansion of the volume of cases performed at existing providers. There are no physical constraints to the alternative, only the need for additional staff and supplies. Methodist and Shands can absorb the projected increase in kidney transplant surgeries in the service planning area. Given that lack of constraint, the minimum volume established for existing providers by rule, gives the guidance to determine whether it is appropriate to expand volumes at existing providers or to introduce a new provider. Because there is no competition in the service area in which the existing providers are well above the minimum volume, and the projected volumes for the new programs are exceeded by the projected additional transplants, the establishment of an additional program is appropriate. Subsection 408.035(1)(e) - economies and improvements from joint operative or shared resources The advantages of developing a kidney transplant program at St. Luke's include: the ability to utilize the existing infrastructure which supports the liver and bone marrow transplant programs; and the ability to adopt Mayo Rochester's treatment protocols, standards, and training resources, and to participate in its research projects. The only clearly identified disadvantage is the risk of undermining the cooperation of Mayo-Jacksonville transplant surgeons with Methodist and the loss of some transplant surgeries from Methodist and Shands. On balance, the introduction of a kidney program in Florida, emulating the Mayo-Rochester program, offers a valuable sharing of Mayo resources. Subsection 408.035(1)(f) - need for equipment or services not accessible in adjoining areas St. Luke's proposal will not result in the introduction of any special equipment or services which are not reasonably or economically accessible in adjoining areas. Subsection 408.035(1)(g) - need for research and educational facilities; (1)(h) - needs of training programs and schools for health professionals Mayo-Jacksonville has active research, medical residency, and fellowship training programs in Jacksonville. Most of the inpatient care associated with the research and educational programs is provided at St. Luke's. A new program at St. Luke's offers new educational opportunities for Mayo- Jacksonville physicians. Subsection 408.035(1)(h) - availability of personnel for project accomplishment (see also Rule 59C-1.044) While the statutory criteria generally, considers whether CON proposals include plans to employ the necessary personnel, the organ transplant rule gives much greater detail. As required by rule, St. Luke's has the staff needed to care for the transplant patients. It offers 24-hour on-site dialysis, and is staffed by renal care and dialysis nurses, nutritionists, respiratory therapists, social workers, psychologists, dialysis laboratory workers and administrators. Physicians include board and UNOS certified transplant surgeons, anesthesiologists, pathologists, psychiatrists, nephrologists, endocrinologists, and immunologists and infectious disease specialists. In addition to the health care professionals needed for operation of a kidney transplant program, St. Luke's has significant experience with the data collection process necessary to evaluate adequately a transplant program. Among the requirements of the Rule are a 24-hour shared call system for organ procurement, and clinical review committees, which already exist. St. Luke's operates a 17-bed intensive care transplant unit capable of prolonged reverse isolation, if required. Equipment is available and in operation for cooling, flushing, and transporting organs, as are an on-site tissue typing laboratory and an in-house blood bank, as the parties stipulated. Subsection 408.035(1)(h) - availability of funds for project accomplishment and Subsection 408.035(1)(i) - immediate and long-term financial feasibility The total project cost is $238,450, which covers filing fees, staff training, and equipment. No renovation or construction costs are anticipated because St. Luke's has adequate capacity to implement the kidney program in existing spaces. Methodist's expert testified that the financial feasibility of the project cannot be determined due to errors on Schedule 2 of the CON application and the lack of reliable utilization projections. As previously determined, the utilization projections are supported by the projected number of area one patients with kidney failure who ultimately have transplant surgeries. Schedule 2 of the CON application lists the capital project commitments of the applicant. St. Luke's listed projects which total $35.9 million taken from a "1998 Capital Budget Request Summary." The total, in excess of $35 million, represents the budget request summary of just over 34 million, minus approximately $4 million that had already been spent, plus a little over $5 million for the two pending CONs and expansion of an intensive care unit (ICU). The ICU expansion cost of $500,000, was understated by $766,000. At the hearing, however, St. Luke's expert testified that he mistakenly listed St. Luke's "wish list," when he used $34 million, which exceeded "approved" projects by $17 to $18 million. That total would have been approximately $16,974,000. The available cash and investments for St. Luke's, approximately $80 million, is sufficient to cover the project costs and other capital projects at either $35 million or $16 million, or $21 million if, as asserted at hearing, the $16 million is understated by $5 million. The proposal is financially feasible in the short-term, even considering the decline in available cash and investments to $65 million at the time of the final hearing. In terms of long-term financial feasibility, the experts considered profits or losses from operations. St. Luke's experienced losses from operations of $4.5 million, $4 million, and $12.9 million in the years 1996, 1997, and 1998, respectively. When investment income is considered, however, St. Luke's had a positive income figure of $5.2 million in 1997 and losses reduced to $.7 million in 1998. St. Luke's explained the losses as temporary due to the initiation of costly new services, the enhancement of information systems, and an increase in charity care. The charges for kidney transplants at St. Luke's are expected to equal $57,200 a case, or $1.7 million in gross revenue for 30 cases at the end of the second year of operations. The expected charges are reasonable when compared to charges, in 1996, of $50,000 at Mayo-Rochester, $42,000 at Shands, $38,000 at Methodist, and a Florida average of $81,000. Kidney transplants continue to receive cost-based reimbursements from Medicare. From the $1.7 million in gross revenue, St. Luke's expert projected an incremental profit of approximately $100,000. In addition, the audited financial statements of the Foundation were submitted with St. Luke's CON, with a statement of the Foundation's willingness to fund the project. With over $1 billion in cash and investments and, for 1997, net income over $31 million, the Foundation is able to assure the short and long- term financial feasibility of the kidney transplant program at St. Luke's. Subsection 408.035(1)(j) - needs of a health maintenance organization (HMO) Although the Mayo organization includes a licensed Florida HMO, the proposal is not intended to serve its needs any more than those of any other potential patients. Mayo- Jacksonville and St. Luke's have contracts to provide services to a number of other HMOs. Subsection 408.035(1)(k) - substantial services to non-resident of the district or adjacent districts Currently, St. Luke's attracts 51% of its patients from Duval County, another 21% from the other counties in District 4, 16% from the rest of Florida, and the remaining 12% from outside of Florida. The patient origin for Mayo-Jacksonville is even more geographically dispersed than that of St. Luke's, with 22% of from outside of Florida. By comparison, nearly 99% of Methodist's patients come from North Florida. St. Luke's patient origin data indicates the reasonableness of its expectation that 15% of kidney transplant patients will come from outside Florida. St. Luke's, therefore, meets the criterion for substantial service to non-residents. Subsection 408.035(1)(l) - impact on costs, effects of competition on improvements or innovations in financing and delivering services with quality assurance and cost-effectiveness St. Luke's expects expanded transplant services to reduce its overall fixed cost per transplant. The introduction of a Mayo-affiliated medical program is reasonably expected to introduce beneficial competition to the market which currently has no competition. The fact that competition will come from a nationally-known, very successful program is expected to have a positive impact on existing programs. Subsection 408.035(1)(m) - costs and methods of construction Methodist contends that St. Luke's omission of architectural drawings or floor plans in the CON makes it impossible to consider the statutory criteria related to construction. While St. Luke's failed to include any architectural drawings, it did include descriptions of the existing spaces and in-house services which will support the program. Schedule 1 and 9 of the application show that no costs are associated with construction, expansion, remodeling or demolition. Architectural drawings were not submitted and not required by AHCA for CONs filed by the Cleveland Clinic (kidney transplant), Tampa General (lung transplant), and University Medical Center (heart transplant). In each instance, the facility proposed using existing spaces for the new programs. Based on AHCA's past practices in comparable circumstances, St. Luke's application is not flawed due to the absence of architectural plans. Subsection 408.035(1)(n) - history of and proposed services to Medicaid and medically indigent patients St. Luke's has historically provided limited Medicaid and charity care. See Findings of Fact 39 and 40. St. Luke's proposal to perform 3% Medicaid and 3% charity kidney transplants in the second year of operation is the equivalent of one Medicaid and one charity case. That commitment, however, exceeds the Florida average and the commitment AHCA required of Bert Fish program. The commitment made by St. Luke's is adequate for kidney transplant services. Subsection 408.035(1)(o) - past and proposed continuum of care in multi-level system St. Luke's affiliation with Mayo physicians' practices and the Mayo-Jacksonville clinic allow it to incorporate kidney transplant services into a multi-level system which includes home health and outpatient care. Subsection 408.035(2)(a) - capital expenditures proposals (a) less costly alternatives; (b) utilization of similar services; (c) alternatives to new construction; and (d) serious access problems Subsection 408.032(2), Florida Statutes, defines capital expenditures as follows: "Capital expenditure" means an expenditure including an expenditure for a construction project undertaken by a health care facility as its own contractor, which, under generally accepted accounting principles, is not properly chargeable as an expense of operation and maintenance, which is made to change the bed capacity of the facility, or substantially change the services or service area of the health care facility, health service provider, or hospice, and which includes the cost of the studies, surveys, designs, plans, working drawings, specifications, initial financing costs, and other activities essential to acquisition, improvement, expansion, or replacement of the plant and equipment. In this project, St. Luke's proposes to incur the cost for kidney transplant equipment to establish the new service. The least costly alternative is enhanced Mayo participation in the program at Methodist. Methodist is, however, sufficiently utilized, well in excess of the rule minimum. No new construction is required at St. Luke's to implement the kidney transplant service. Patients will not, however, experience serious problems with access to kidney transplant services if St. Luke's is not approved. There are no physical constraints on the expansion of services at Shands or Methodist. In the absence of physical constraints at existing providers, but in consideration of their volumes which are well in excess of that required, the introduction of competition of the Mayo quality at such low cost is, on balance, desirable for the health care system.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED That a final order be entered issuing CON 9078 to establish a new adult kidney transplant program at St. Luke's Hospital in Jacksonville. DONE AND ENTERED this 17th day of February, 2000, in Tallahassee, Leon County, Florida. ELEANOR M. HUNTER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 17th day of February, 2000. COPIES FURNISHED: Sam Power, Agency Clerk Agency for Health Care Administration Fort Knox Building 3, Suite 3431 2727 Mahan Drive Tallahassee, Florida 32308 Julie Gallagher, General Counsel Agency for Health Care Administration Fort Knox Building 3, Suite 3431 2727 Mahan Drive Tallahassee, Florida 32308 Richard A. Patterson, Esquire Agency for Health Care Administration Fort Knox Building 3 2727 Mahan Drive, Suite 3431 Tallahassee, Florida 32308 F. Philip Blank, Esquire R. Terry Rigsby, Esquire Geoffrey D. Smith, Esquire Blank, Rigsby & Meenan, P.A. 204 South Monroe Street Tallahassee, Florida 32301 Michael J. Cherniga, Esquire Seann M. Frazier, Esquire Greenberg Traurig, P.A. Post Office Drawer 1838 Tallahassee, Florida 32302
The Issue Petitioner Department of Professional Regulation seeks to suspend, revoke, or otherwise discipline respondent's license to practice medicine on charges of professional misconduct violative of Chapter 458 Florida Statutes (1979). The issues for determination are: Whether respondent is guilty of gross or repeated malpractice or the failure to practice medicine with that level of care, skill, and treatment recognized by a reasonably prudent similar physician as being acceptable under similar conditions and circumstances, in his treatment of Verdi Hammond Burroughs ("Burroughs") and Charles Kirk ("Kirk") in violation of Section 458.331(1)(t), Florida Statutes (1979); Whether respondent's treatment of Burroughs and Kirk was fraudulent and constituted misrepresentation, and whether the treatment was medically beneficial to the exclusion of other forms of proper medical treatment and was, therefore, harmful to the patient in violation of Section 458.331(1)(1), Florida Statutes (1979); Whether respondent violated Sections 458.331(1)(1), 458.331(1)(h), Florida Statutes (1979) by failing to fully inform Burroughs and Kirk (in his prescribing and administering Amygdalin [Laetrile]) of alternative methods of treatment for their cancer, and the potential of these methods for cure; whether each patient failed to sign a written release releasing respondent from liability; and whether respondent informed each patient, in writing, that Laetrile has not been approved as a treatment or cure by the Food and Drug Administration of the United States Department of Health and Human Services; Whether respondent's treatment of Burroughs and Kirk, when measured by the prevailing standards of medical practice in the community, would constitute experimentation on a human subject without first obtaining full, informed, and written consent, in violation of Section 458.331(1)(u), Florida Statutes (1979); Whether respondent failed to comply with Sections 458.333 and 458.335, Florida Statutes (1979); Whether metabolic therapy is recognized by a respectable minority of the medical profession as a treatment for cancer. Background By an eight-count administrative complaint dated March 31, 1982, petitioner Department of Professional Regulation, Board of Medical Examiners (Department), charged respondent Daniel J. Clark with multiple violations of Chapter 458, Florida Statutes (1979), the "Medical Practice Act." Respondent disputed the charges and requested a Section 120.57(1) hearing. On April 29, 1982, the Department forwarded this case to the Division of Administrative Hearings for assignment of a hearing officer. Hearing was then set for September 22 and 23, 1982. At hearing, the Department presented the testimony of Evelyn Kuhn, Daniel Clark, Alvin Edward Smith, Tammy Thompson, Brenda Kempton, and Lois Ann White. Petitioner's Exhibit Nos. 1/ 1-5 were received into evidence. The respondent testified in his own behalf and presented the testimony of Rodrigo Rodriquez, Rebecca Scholz, and Allen Bernsten. Respondent's Exhibit Nos. 1-5 were proffered but not received into evidence. The parties filed proposed findings of fact and post- hearing briefs by December 1, 1982. Those proposed findings which are incorporated herein are adopted; otherwise they are rejected as unsupported by the evidence or unnecessary to resolution of the issues. Based on the evidence presented at hearing, the following findings of fact are determined:
Findings Of Fact I. Respondent Since 1976, respondent has been licensed to practice medicine in the State of Florida, holding license number ME0026861. (Tr. 269; Prehearing Stipulation) He received a bachelor of science degree from Georgia Southwestern College and a medical degree from Medical College of Georgia. In 1975, he trained for five months with a gynecological oncologist in Americus, Georgia. In 1978, he completed a three year residency program at University Hospital in Jacksonville, Florida. (Tr. 266-268). Since 1979, he has practiced medicine in Ormond Beach, Florida. Initially, his practice included gynecology, family practice, and general nutrition. He then began to treat cancer patients with metabolic (nutritional) therapy. The purpose of such therapy is to enhance the immunological and biological capacities of a patient--nutritionally, immunologically, and physiologically--in order to improve the patients performance in combating cancer. This cancer treatment includes the administration of Amygadalin (Laetrile), vitamins, herbal teas and detoxifiers, and the application of salves and packs to cause localized hyperthermia. It is not a conventional, orthodox, or widely practiced form of cancer treatment. No other physician in Volusia County uses it. Most accredited medical schools in the United States do not teach it. The American Medical Association (AMA) considers it to be experimental. Eventually, respondent's metabolic treatment of cancer patients began to account for 15 percent to 20 percent of his practice. (Testimony of Clark, Rodriquez; P-3) II. Respondent's Treatment of Verdi Hammond Burroughs In October or November 1979, Nelson Murray, a chiropractor, asked respondent to examine Verdi Hammond Burroughs, a patient who had complained to Dr. Murray about a lump in her right breast. (The offices of Dr. Murray and respondent were close together in the same building. And, in the past, Dr. Murray had referred patients to respondent for medical treatment.) (Testimony of Clark, P-3). Respondent, who considered it an "across-the-hall consult," agreed. He went to Dr. Murray's office, examined Ms. Burroughs' right breast, and noted a small lump. He recommended that she have a biopsy or that she see a surgeon for a second opinion, to make sure that the lump was not malignant. (Subsequently, she failed to follow this recommendation.) Although he did not refer her to a particular surgeon, he looked up the names of several who might be willing to operate on her, as she was a Jehovah's Witness. (Since Jehovah's Witnesses object to blood transfusions, many surgeons refuse to operate on them.) (Testimony of Clark, P-3) During this brief examination, respondent did not perform any diagnostic tests other than to manually examine the breast. Although he kept meticulous patient medical records, he did not open a patient record on Ms. Burroughs or have her complete a patient history form. He took no progress notes during the examination. He did not consider her his patient, did not assume responsibility for her treatment, and did not charge her a fee. (Testimony of Clark; P-1, P-3). Respondent had no contact with Ms. Burroughs until Dr. Murray asked him to reexamine her in February, 1980. The circumstances were similar. Respondent examined her in Dr. Murray's office, noted the breast lump was unchanged, made no medical reports, and charged no fee. He recommended that she undergo a laboratory test, including complete blood chemistry, SMAC 22, CBC, and sedimentation rate. For this purpose, he specifically referred her to Dr. Nelson A. Murray, a medical doctor and pathologist in Jacksonville, Florida. (At that time, she lived in Jacksonville, Florida.) He also recommended, again, that she have a biopsy performed--a recommendation which she, again, failed to follow. (Testimony of Clark; P-3). On September 22, 1980, almost eight months later, chiropractor Murray again asked respondent to come to his office and examine Ms. Burroughs right breast. Respondent's subsequent examination revealed that the entire breast was severely inflamed and the nipple was inverted or sloping downward. The breast had the appearance of an inflamed carcinoma. Respondent strongly suggested that she have laboratory tests (the same tests which he had recommended earlier) done as soon as possible and that she arrange to see him immediately thereafter. He, again, told her that she needed a biopsy and gave a preliminary diagnosis of breast cancer. This time, she followed his recommendation. Two days later, she had the complete lab tests done by Dr. Murray, the Jacksonville pathologist. (Testimony of Clark; P-3). Respondent still did not consider Ms. Burroughs his patient or assume any responsibility for her treatment. During this September 22, 1980, examination, he did not open a patient file, take notes, or charge a fee. There is no evidence that Ms. Burroughs-- at that time--believed that she was his patient--or he, her doctor. Nor is there evidence that either party misunderstood or was confused about their relationship or their respective responsibilities. (Testimony of Clark; P-3). Between the February, ,1980 and September 22, 1980, examinations, respondent did not contact Ms. Burroughs and did not discuss her condition with chiropractor Murray. Between the November, 1979 and the September, 1980, examinations, respondent did not order or perform any further diagnostic tests on Ms. Burroughs and did not attempt to check with her to see if she had followed his recommendations. Neither did he expressly inform her that he was not her doctor. The Department contends that his failure to take these actions violates a generally accepted standard of medical care. (Testimony of Clark; P- 3) This contention, however, is unsubstantiated. The evidence does not demonstrate that the generally accepted standard of medical care required respondent to take such actions. Conversely, it has not been specifically shown how, and in what ways, respondent's treatment of Ms. Burroughs between November, 1979 and September, 1980, fell below an acceptable standard of medical care. 2/ Ms. Burroughs became respondent's patient on October 7, 1980, when she came to his office for medical treatment. He performed a complete work up, physical examination, and medical history, and reviewed the results of the lab blood tests. He concluded that her condition was essentially normal except for her right breast, which was severely inflamed and the nipple retracted. In addition, the lymph nodes under her right armpit' were palpable and enlarged. His initial impression was that she had inflammatory carcinoma (cancer) of the right breast with lymph gland involvement. He then scheduled her for a biopsy, which was necessary before he could determine the type of cancer involved. (Testimony of Clark; P-3) The biopsy was performed on October 9, 1980 by Dr. Kluger, a St. Augustine physician. It indicated an inflamatory intraductal adenocarcinoma of the breast, primary. Dr. Kluger, who felt that surgery was inadvisable because of the lymph node involvement, subsequently recommended to respondent that Ms. Burroughs undergo radiation and chemotherapy. (Testimony of Clark; P-1, P-3). During the October 7, 1980, office visit, respondent explained to Ms. Burroughs the alternative methods of cancer treatment, including their potential for cure. The methods discussed included surgery, radiation, chemotherapy, and metabolic therapy. She refused to undergo radiation or surgical treatment, explaining that her husband died of lung cancer after receiving surgery, radiation, and chemotherapy. She agreed however, to consider chemotherapy in conjunction with metabolic therapy. He explained to her that metabolic therapy was not a treatment against the cancer, per se, but that it would help "build up her body to where her own immune system would help her fight the cancer." (P-1). She agreed to accept this treatment--chemotherapy with metabolic therapy--then signed four separate affidavits on forms provided by respondent. The affidavits acknowledged her consent to the ordering and administration of Laetrile. Respondent, however, did not inform Ms. Burroughs in writing (by these affidavits or any other documents), that Laetrile has not been approved as a treatment or cure by the Food and Drug Administration of the United States Department of Health and Human Services. She also did not sign a written release, releasing him from any liability from the administration of Laetrile. (Testimony of Clark; P-1, P-3) During the October 7, 1980, visitation--after the affidavits were signed--respondent began treating her with metabolic therapy, consisting of Laetrile I.V., Vitamin C, B Vitamins, B-15, B-12, and crude liver injections. Metabolic therapy was commenced without obtaining her prior written consent. (Testimony of Clark; P-1). Several days later, on October 13, 1980, respondent began treating her with small doses of chemotherapy in conjunction with the metabolic therapy. The chemotherapy treatment plan was based on a phone call to Dr. Donald Cole, a New York oncologist. Respondent described the type and extent of Ms. Burroughs cancer and Dr. Cole recommended small 100 milligram doses of 5-FU twice weekly, two to five milligrams of Laetrile twice weekly, and 50 milligrams of Cytoxin PO orally. Respondent administered this regimen until he discontinued chemotherapy at the end of November, 1980. (Testimony of Clark; P-3). These doses and intervals of chemotherapy did not conform to the manufacturers' recommended doses contained in the Physicians Desk Reference, a standard reference used by practicing physicians. The doses administered by respondent were lower than those normally used in chemotherapy and are considered to be in the research or experimental stage. (Testimony of Clark, Smith). Chemotherapy and metabolic therapy are incompatible-- they work at cross-purposes. Chemotherapy drugs are strong immunosuppressants. They are toxic and intended to poison cancer cells; 3/ their effect is to suppress the body's immunological system. In contrast, the purpose of metabolic therapy is to enhance that same immunological system. (Tr. 215-216). For this reason, the use of chemotherapy is not included within the protocols for metabolic therapy found in International Protocols in Cancer Management. 4/ Respondent concedes that this publication is authoritative and contains the standard protocols for metabolic therapy. (Testimony of Rodriquez, Clark). Ms. Burroughs chemotherapy stopped at the end of November, 1980, but her metabolic therapy continued. By March, 1981, her right arm was beginning to swell because of enlarging lymph nodes. On the March 2, 1981, office visit, respondent told her that Laetrile was not stopping the cancer, and discussed restarting chemotherapy. He increased her Vitamin C, and began administering herbal cleaners and botanical medicines containing red clover, chapparral, myrr, goldenseal, yellow dot, juniper berries, yuva, ursaberries, conch grass, and dandelion. Respondent categorizes these medicines as blood purifiers, lymph purifiers, liver cleaners, and kidney cleaners. (P-3). By June, 1981, respondent believed the cancer had metastasized to Ms. Burroughs' right lung. During office visits in early June, he rubbed herbal ointment or liniment, Vitamins E and F, into her rib cage area. He also prescribed herbal packs and poultices to cause localized hyperthermia (heat increase). He prescribed dark and yellow herbal salves and instructed her to apply them to her right breast and underarm area, explaining that they would draw out and break down the cancer tumor. (Testimony of Clark, Kuhn; P-3). These salves--strong and painful--caused pieces of gray tissue to fall off her breast and underarm area. Respondent reacted by encouraging her, telling her that the salves were breaking down the cancerous tumor. (He now admits, however, that the herbal ointments and salves would have been ineffective in treating the cancer which had metastasized to her lungs.) He also prescribed a tea which tasted like black pepper. She forced herself to swallow it because he had told her that it would break up the cancer in her body. This representation was also untrue. (Testimony of Clark, Kuhn, Smith.) In administering metabolic therapy to Ms. Burroughs, respondent also prescribed whole-body hyperthermia for the purpose of stimulating her immune system. This required her to totally submerge herself in bath water which was as hot as she could tolerate. According to the standardized protocols for metabolic therapy, as stated in International Protocols in Cancer Management, such "whole-body hyperthermia, while successful in some cases, is dangerous and considered experimental." (Tr. 320, Testimony of Clark). Respondent's metabolic and chemotherapeutic treatment of Ms. Burroughs failed to conform to the standard of care recognized by a reasonably prudent similar physician as being acceptable under similar conditions and circumstances. It fell below the prevailing and generally accepted standard of care recognized by his peers in the medical community: a.) After the diagnosis, respondent made an improper and incomplete staging 5/ of the disease by failing to take a liver scan, which would have revealed the existence (or nonexistence) of liver lesion. Cancer of the liver is deadly and must be dealt with immediately. (Tr. 89-92). b.) After he diagnosed Ms. Burroughs breast cancer, he failed to prescribe surgery or a combination of surgery and radiation therapy, treatment methods which likely would have been beneficial and controlled the disease. (Surgery, such as a radical mastectomy, does not cause a significant loss of blood, so blood transfusions--something Ms. Burroughs opposed--could have been avoided.) If necessary, chemotherapy--using conventional doses--could also have been administered. The chemotherapy and metabolic therapy which respondent provided Ms. Burroughs was probably worthless. The herbal salves and teas which he prescribed were incapable of drawing out or breaking up the cancerous tumor. c.) When Ms. Burroughs' cancer was diagnosed, it was in an advanced and complicated stage. Under such circumstances, a general practitioner (such as respondent) should have referred her to or obtained a consult from an oncologist, a specialist in the treatment of cancer. Respondent did neither. (Testimony of Smith). Metabolic therapy is not approved or recognized as acceptable for cancer treatment by a respectable minority of the medical profession. This finding is based on the opinion of Alvin Edward Smith, MD., board certified in oncology and internal medicine, and a Fellow of the American College of Physicians. He has treated cancer patients since 1978. His opinion on this issue is considered more credible than the contrary opinion of Rodrigo Rodriquez, M.D., who practices medicine in Tijuana, Mexico, who is not licensed to practice medicine in the United States, and who--other than acting as a guest resident at Kings County Hospital in Brooklyn, New York--has never practiced medicine in the United States. (Testimony of Smith, Rodriquez). III. Respondent's Treatment of Charles Kirk Charles Kirk became respondent's patient on August 13, 1980, and died shortly thereafter on September 9, 1980. Mr. Kirk, a 77-year-old male, was having great difficulty swallowing food and had a history of recurring choriocarcinoma of the larynx or throat. Surgery had been performed on him several times, and his larynx (voice-box) had been removed. Respondent explained to him the alternative methods of treatment, including surgery, chemotherapy, radiation, and metabolic therapy. Mr. Kirk opposed further surgery and objected to chemotherapy and radiation. He requested Laetrile. After he signed an affidavit provided by respondent (the same form which had been provided Ms. Burroughs), respondent ordered Laetrile. (Testimony of Clark; P-2). Respondent then referred him to a general surgeon for the placing of a gastrostomy feeding tube, a device which would enable him to swallow food and liquids. The tube was successfully placed surgically, after which respondent began administering Laetrile to him as part of metabolic therapy. The treatment was brief, only nine or ten days. On September 26, 1980, Mr. Kirk died. (Testimony of Clark; P-2). Mr. Kirk's condition, when he first became respondent's patient, was essentially irreversible; he was in the final stages of a fatal cancer. (Testimony of Clark, Smith; P-2). Respondent administered Laetrile to Mr. Kirk without first obtaining from him a release of liability and without informing him, in writing, that Laetrile has not been approved as a treatment or cure by the Food and Drug Administration of the United States Department of Health and Human Services. (Testimony of Clark.)
Recommendation Based on the foregoing, it is RECOMMENDED: That respondent's license to practice medicine be suspended for one year, for violating Section 458.331(1)(h), (1), (t), (u), Florida Statutes (1979). DONE AND RECOMMENDED this 9th day of March, 1983, in Tallahassee, Florida. R. L. CALEEN, JR. Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of March, 1983.
The Issue The issue to be resolved in this proceeding concerns whether the Respondent's medical licensure should be subjected to discipline for the reasons asserted in the Administrative Complaint, involving his alleged malpractice concerning patient, E.L.
Findings Of Fact The Respondent at all times material hereto has been a licensed physician in the State of Florida, having been issued License No. ME0030859. The Respondent practices at 1800 N.E. Street, Suite 521, Pensacola, Florida 32501. The Petitioner is an agency of the State of Florida. It is charged by the Legislature, as pertinent hereto, with enforcing the provisions of Chapter 458, Florida Statutes, and related rules, pertaining to the regulation of licensure and the quality of practice of medical doctors within the State of Florida. The Respondent is a board-certified dermatologist, practicing that specialty in the State of Florida in excess of 15 years. There is no evidence of any prior disciplinary action against the Respondent's licensure nor of any prior instance when his practice failed to conform to appropriate professional standards. In the course of his practice, the Respondent sometimes does his own microscopic pathological examination of tissue samples taken from patients (biopsies) on occasions when he deems it appropriate and that a consulting opinion is not required. It is undisputed by the parties that a dermatologist such as the Respondent, who had extensive training in dermatopathology during his medical education, can appropriately do such biopsy work within the standard of care of a reasonable physician practicing under similar conditions and circumstances. If he does so, however, he is held to the standard of a dermatopathologist in the course of his professional practice. The Respondent treated E.L. (an 80-year-old male patient at times pertinent hereto) since approximately 1982 for various problems involving pathology of the skin, including skin carcinoma. On November 21, 1991, E.L. presented as a patient of the Respondent showing a crusty area measuring approximately 1 x 2 centimeters on the vertex of his scalp or the back of his head. The lesion in question appeared on the skin with a hard crust, whitish or yellowish in color, and the Respondent diagnosed it as hypertrophic actinic keratosis. This is sometimes a pre-cancerous condition of the skin. Upon making his diagnosis, which he did clinically, without biopsy, the Respondent performed a curettage, or scraping of the tissue, to remove and destroy it. He did this by injecting the area with lidocaine as an anesthetic before performing the curettage. The Respondent had previously treated the same sort of condition on E.L. with liquid nitrogen but chose, this time, to treat the lesion with extension cautery and curettage. He did this because he was attempting to lessen the discomfort in his 80-year-old patient, who had already undergone a number of procedures to remove pre-cancerous or cancerous lesions of the skin on his head. The use of liquid nitrogen and the associated burning of the tissues involved would cause more difficult healing and discomfort for the patient. The treatment which the Respondent accorded the actinic keratosis condition, by curettage, is an acceptable, appropriate treatment for such a condition. It is undisputed by either the Petitioner's or the Respondent's expert witnesses, as well as the Respondent in his testimony, that such a clinical diagnosis and the following treatment by curettage is within the professional standard of care and practice by dermatologists practicing under similar conditions and circumstances. A biopsy is not a necessary prerequisite to such treatment. After the November 21, 1991 destruction of the skin lesion, the patient did not return for approximately one month. On December 19, 1991, he returned to the Respondent concerned about possible infection at the removal site. The Respondent, however, detected only granulation tissue, which are normal granular projections on the surface of a normally-healing wound. Consequently, there was no reason within the bounds of reasonable medical treatment standards for the Respondent to have biopsied the lesion area on that office visit occasion, either. Patient E.L. returned on January 3, 1992, at which point the Respondent noted a minor area of "dermatitis" or a non-cancerous inflammation of the skin, for which he prescribed a cortisone ointment. The Respondent did no biopsy at that time, either, and the clear and convincing evidence does not demonstrate that a biopsy was required under those conditions and circumstances within acceptable, reasonable bounds of the Respondent's professional practice. Patient E.L. returned to the Respondent on January 23, 1992 complaining of unsatisfactory progress with the healing of the lesion. The lesion by that time had become a rounded, raised growth with central cratering, characteristic of a keratoacanthoma. The Respondent examined the lesion or tumor clinically and determined that it appeared to be a keratoacanthoma. A keratoacanthoma is a rapidly-growing nodule with a central "crater", which then fills with a crusty material. It usually remains localized and most often resolves itself spontaneously, even if untreated. On very rare occasions does it become an aggressively-growing tumor. The Respondent biopsied the suspected keratoacanthoma by performing an excision of the area. He excised the nodule, taking a narrow margin of several millimeters around it and then performed a suture closure of the wound. He performed a biopsy of the tissue thus taken himself and interpreted the biopsy results approximately one week later as confirming his clinical diagnosis of a keratoacanthoma. Keratoacanthoma is regarded as a "low-grade" form of squamous cell carcinoma. The diagnosis is based upon a clinical observation with the naked eye, based upon history, as well as by pathological diagnosis. Conservative treatment is appropriate for a keratoacanthoma since they often resolve themselves spontaneously. Simple observation, surgical excision, curettage with or without electro-desiccation, radiation therapy, intra-lesional injection, and topical application of 5-fluorouracil and methotrexate are all acceptable forms of treatment for keratoacanthoma and can be reasonably expected to cure the condition. On rare occasions, keratoacanthoma can recur, even with such treatment. The diagnosis and treatment of keratoacanthoma is a matter of good- faith differences of opinion among reasonable dermatologists and pathologists, based upon their clinical judgment and experience. Some diagnose it as keratoacanthoma, which is a low-grade form of squamous cell carcinoma; and some diagnose it as squamous cell carcinoma with varying degrees of "differentiation". The photograph of the lesion as it was seen by the Respondent prior to the January 23, 1992 surgery shows a lesion consistent with the clinical appearance of a keratoacanthoma. The Respondent has been properly trained as a dermatologist in dermatopathology, and he commonly reviews biopsy and pathology slides. He is not required, under pertinent practice standards, to seek consultation when he believes that he has made a proper diagnosis. It was proper for him to read and review the pathology slide of the biopsy specimen, even though he himself acknowledges, as do the two expert witnesses, that he would be held to a dermatopathologist's professional practice standard by doing so. The Respondent opined that actinic keratosis developed into the keratoacanthoma. Dr. Breza, the Petitioner's expert witness, opined that actinic keratosis does not develop into keratoacanthoma but, rather, into squamous cell carcinoma. Even he acknowledged, however, that good pathologists have trouble making the diagnosis of keratoacanthoma and prefer generally to diagnosis such conditions as simply "low-grade" squamous cell carcinoma. Dr. Hanke, in his testimony, established that keratoacanthoma and squamous cell carcinoma are different gradients of diagnosis on the same continuum or range describing squamous cell carcinoma. That is, in lay terms, a keratoacanthoma is a "low-grade" squamous cell carcinoma. They are not precisely the same diagnosis, but both diagnoses describe the same general type of cells. As shown by Dr. Breza, squamous cell carcinoma tumors or lesions generally tend to appear somewhat flatter than that characteristic of a keratoacanthoma. Squamous cell carcinomas tend to be more indurated or firm on the outer edges and to have more inflammation on the outer edges, including occasional ulceration. The Respondent's description in E.L.'s medical record seems more consistent with squamous cell carcinoma, but the photographic images of the growth or lesion at issue, made at the time the biopsy and excision was performed, appear also consistent with keratoacanthoma. Based upon the information, including clinical appearance, that the Respondent had to consider in making his diagnosis and given that reasonable pathologists can differ concerning the gradients of diagnosis of squamous cell carcinoma (which includes keratoacanthoma), as shown by the expert testimony, the Respondent's diagnosis does not constitute a departure from appropriate, professional standards. The deficiency in the Respondent's practice in this instance began with the excision made on January 23, 1992. The Respondent took the tissue material from the excision for biopsy and, after pathological examination of the sample, diagnosed the nodule as keratoacanthoma. The Respondent, however, did not establish a "negative margin" for the excision. That is, the tissue removed had positive margins, especially the deep margin, which means that carcinoma cells could be observed on the surface of the piece of tissue removed. This means that the Respondent could not be assured that carcinoma cells did not remain in the tissue area surrounding the walls of the excision site because the margin of the excision around the nodule to be removed was not wide enough. The same slide and tissue sample which the Respondent used for biopsy in January 1992 was examined by a dermatopathologist, but not until some six months later, in July 1992. The dermatopathologist reported his opinion that the biopsy showed an "infiltrating squamous cell carcinoma with involvement of the lateral and deep margins." An infiltrating carcinoma implies that it is a more aggressive tumor than would be the case with a normal keratoacanthoma. The Respondent did not report those positive margins from the results of his excision and biopsy in January 1992. His testimony indicates that he may have seen them or been aware of them but did not make a larger incision in order to achieve a negative margin because of his concern about the complicated closure techniques that would be necessary. He was concerned with attendant additional discomfort to this elderly patient, as might be entailed with the possible use of grafting in order to make closure of the wound. He also seemed to discount the need to excise a larger margin because of his belief that he was dealing with a non-aggressive keratoacanthoma. In fact, however, the clear and convincing evidence shows that a larger margin wound could have been excised without the necessity for more elaborate techniques of closure and attendant discomfort to the patient. Moreover, it was established that even this elderly patient, with his attendant heart problems, could have tolerated a more elaborate excision of the tumor in question, since the procedure could still be done under low-risk local anesthesia in the Respondent's office. An infiltrating carcinoma is one which is more aggressive. It can move from its original location and infiltrate the skin and blood vessels, which can, in some cases, result in the tumor spreading via the blood stream or by infiltrating the lymphatic system, with migration to regional lymph nodes. The squamous cell carcinoma is not known for being a readily metastasizing form of cancer. It is known on some occasions to metastasize, however. The finding of positive margins on the pathological examination in July 1992 means that the tumor extended to the cut surface of the excision at the time of the January excision procedure from which that biopsy sample was taken. Thus, tumor cells remained in the patient's scalp after the January 1992 excision procedure. The finding of a positive margin requires that another margin be established, meaning that the physician must cut another level of tissue until normal skin (a negative margin) is revealed. This can be done by conventional surgery, by just a larger excision area being removed, or by "MOHS" surgery, which involves freezing sections of the excision area, with small portions of the suspicious area removed at a time and with attendant pathology examinations so that each "thread" of cancer cells can be removed with minimal damage to surrounding tissues and less attendant discomfort and healing problems associated with the resulting surgical wound. The patient could have tolerated either type of procedure in January 1992. The Respondent did not establish a negative margin, however. He only excised the carcinoma once. He stated that he was really seeking only a biopsy sample and that he considered the treatment by excision of the nodule itself and attendant scraping of the wound to be adequate as conservative treatment, to take care of what he believed to be a non-aggressive keratoacanthoma. This may be a correct assessment if the physician is certain that he is confronted with a non-aggressive, non-infiltrating keratoacanthoma. However, if positive margins to the excisional wound result, the patient is better served, and a successful treatment result much more likely, if all suspected carcinoma cells are removed at that time. If the Respondent knew of the positive margins to the excision and had made an additional excision to remove all positive margins, the provision of additional, more elaborate treatment techniques would not have been delayed for nearly six months and likely would have been unnecessary. The determination of the existence of positive margins, after the January 1992 excision procedure, should have caused him to remove additional tissue to obtain a safe, negative margin. That failure of care, in his capacity as a dermatopathologist, resulted in a six-month delay before the dermatopathologist, at Sacred Heart Hospital, identified the positive margins. He identified them on the Respondent's same January 1992 pathological slide, when he examined it in July 1992, after which radiation and further more radical treatment was attempted. Thus, the delay in treatment action, resulting from the delay in acting on the existence of positive margins by the Respondent, resulted in a six-month delay in appropriate treatment being provided the patient, which is a deviation from the accepted standard of care, as established by the testimony of Dr. Breza, which is accepted in this regard. Earlier determination (or acting on a determination) of the positive margins, after the January 1992 excision procedure would have alerted the Respondent that the excision procedure was unsuccessful and that further treatment was necessary. The patient's lesion occurred on a sun-damaged scalp. The Respondent had treated the patient repeatedly for sun-damaged skin problems, including carcinomas, in the past. Squamous cell carcinomas can be susceptible to mestastases, either regional or systemic when they are located on the scalp, although they are much less susceptible to such mestastases than if they are located on the lip or possibly the dorsal surface of the hand. The Respondent, as a board-certified dermatologist, knew or should have known that the scalp is an area of the body that can be susceptible to metastatic disease such as squamous cell carcinoma. The patient, as even acknowledged by the Respondent's expert, Dr. Hanke, was one with a high risk for developing skin cancer. In any event, after the excision procedure on January 23, 1992, the patient was seen on February 10, 1992 for removal of sutures and examination of the wound. It appeared to be healing nicely at the time, and the patient was advised to return to the Respondent in three months, unless a problem developed. The Respondent next saw the patient on April 6, 1992, when he complained of persistent pain at the excision and tumor site. This was treated by the Respondent by drainage, antibiotics, narcotic pain medications, and sleep- inducers. Later during the treatment regimen, in approximately May 1992, the Respondent felt that chemotherapy was indicated because apparently, the lesion had not been completely excised. Consequently, he prescribed injections of intralesional cortisone methotrexate and 5-fluorouracil. These, however, did not produce satisfactory healing or control of the pain. During April and May 1992, the Respondent saw the patient for complaints of persistent pain, poor healing, and drainage of the wound. On May 18, 1992, the Respondent performed a drainage of the lesion which had begun to show an abscess formation. An abscess formation is an indicator of squamous cell carcinoma, which should have been recognized by the Respondent. This should have alerted him that his diagnosis of simply keratoacanthoma was not correct, at least by that time. With the presence of these continuing and exacerbated problems with the wound site, the Respondent did not seek or perform further biopsy of the tumor site, despite continued complaints of persistent pain and further growth of the lesion between April and July 1992. The patient made 16 visits to the Respondent between April 1992 and July 14, 1992 for treatment and pain relief. During this time, little improvement occurred in the patient's condition, but no additional biopsy or consultation was requested or performed by the Respondent. The lack of improvement in E.L.'s condition during the period of April through July 1992 should have alerted the Respondent that something was incorrect about the patient's condition and that more extensive radical treatment would be necessary. In fact, the Respondent did respond to the continued complaints by, in addition to prescribing antibiotics and pain medication, prescribing the above- referenced intralesional injections of cortisone, methotrexate, and 5- fluorouracil. On July 9, 1992, another curettage procedure was performed and the pathology of the scrapings was sent for evaluation by a pathologist. The Respondent's interpretation of this tissue at the time apparently was a keratoacanthoma; well-differentiated squamous cell carcinoma. This was ultimately described by the pathologist to whom it was referred as a moderately- differentiated squamous cell carcinoma. Subsequently, after the C&D procedure, the patient was referred to Baptist Hospital in Pensacola, Florida, for radiation therapy. He received a full-course of radiation therapy with some booster therapy afterward and then, on his own volition, went for a second opinion to the University of South Alabama Medical Center in Mobile, Alabama. Five physicians at that facility recommended more extensive surgery, which ultimately the patient refused. There is no clear and convincing evidence that, at least at that point in the patient's progress, the persistent tumor had actually mestastized, although it was apparently growing locally. The fact that the lesion at issue was failing to heal and producing persistent pain by the visit of April 6, 1992 should have been interpreted so as to set in motion further investigative procedures, including an additional biopsy, to find out the reason for that condition and its persistence. Although a proper procedure involving excision and biopsy was done in January of 1992, the frozen sections of the lesion could have been interpreted to show that the tumor was an infiltrating carcinoma extending to the lateral and deep margins of the excision and something more aggressive could have been done to treat it at that time. It could have either been re-excised with frozen section control of the margins, referred to a "MOHS'" surgeon for a similar type of surgery or referred to a general surgeon. Radiation therapy could have been tried, at least by the time the persistence of the problem was determinable in April of 1992. The resultant reduction of delay in securing more extensive treatment of the lesion would have certainly benefited the patient. The persistence of the pain in the six-month period of time after the January 1992 excision of the tumor, until just before the time the patient was referred for radiation therapy indicates there was probably perineural invasion by the tumor (infiltration of the nerves), which produced pain. This should have alerted the Respondent that something more than a non-aggressive keratoacanthoma was involved, as well. In summary, it has been demonstrated that the Respondent failed to practice medicine within that level of care, skill and treatment recognized by reasonably prudent, similarly-situated physicians as acceptable under the circumstances, by failing to make an additional biopsy after the patient re- presented with problems associated with persistent pain and improper healing in April 1992; by failing to recognize and act on the presence of positive margins to the excision material taken in January 1992, to effect an additional excision at that time, so as to secure a safe, negative margin to the tumor. The failure to obtain consultation on the biopsy taken from a dermatopathologist was not in itself evidence of falling below appropriate professional levels of care, skill and treatment, but the Respondent, by doing his own interpretation of the biopsies was, as he agrees, creating a situation in which he would be held to the same standard as a dermatopathologist. The failure to correctly interpret the biopsy he took in January 1992, by failing to recognize the positive margins to the excised material and failing to act to remove those indicia of the continued presence of the tumor, at a time when it was thus easily excised, likely prevented an easily-effected cure.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is RECOMMENDED that the Respondent be found guilty of a violation of Section 458.331(1)(t), Florida Statutes, in the manner concluded above, and that the Respondent receive a private reprimand, a $2,000.00 fine, and that he be required to attend 20 additional hours of Category I continuing medical education in the area of diagnosis and treatment of skin cancer. DONE AND ENTERED this 30th day of October, 1995, in Tallahassee, Florida. P. MICHAEL RUFF, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 30th day of October, 1995. APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-3531 Petitioner's Proposed Findings of Fact 1-8. Accepted. 9-10. Rejected, as subordinate to the Hearing Officer's findings of fact on this subject matter. Accepted, but not itself materially dispositive. Rejected, as contrary to the clear and convincing evidence. The evidence does not reflect that one biopsy sample only showed one part of the lesion at issue but, rather, several parts were represented. Accepted. Accepted, but not itself materially dispositive. 15-21. Accepted. 22-24. Rejected, as subordinate to the Hearing Officer's findings of fact on this subject matter. 25-26. Accepted. 27. Rejected, as subordinate to the Hearing Officer's findings of fact on this subject matter. 28-36. Accepted. 37-41. Rejected, as subordinate to the Hearing Officer's findings of fact on this subject matter. 42-44. Accepted. 45. Rejected, as contrary to the clear and convincing evidence and subordinate to the Hearing Officer's findings of fact on this subject matter. 46-53. Accepted, but not in their entirety materially dispositive. 54. Rejected, as subordinate to the Hearing Officer's findings of fact on this subject matter. 55-56. Accepted. Rejected, as not in its entirety supported by clear and convincing evidence of record. Accepted. Accepted, to the extent of failing to practice medicine within the appropriate standard of care by not making earlier and more frequent biopsies only. Respondent's Proposed Findings of Fact 1-17. Accepted. 18. Rejected, as subordinate to the Hearing Officer's findings of fact on this subject matter. 19-20. Accepted. Rejected, as subordinate to the Hearing Officer's findings of fact on this subject matter, and as not entirely in accord with the clear and convincing evidence of record. Accepted. Accepted, but not necessarily as to its material import and subordinate to the Hearing Officer's findings of fact on this subject matter, which contain additional findings of fact not contained in Proposed Finding of Fact No. 23 and which are material, relevant, and necessary to a clear picture of the patient's progress and treatment rendered during the period of April 6, 1992 through July 14, 1992. Accepted, but not as to its purported material import. Rejected, as contrary to the clear and convincing evidence of record, and as subordinate to the Hearing Officer's findings of fact on this subject matter. Accepted, but not as to its purported material import. 27-31. Accepted. COPIES FURNISHED: Britt Thomas, Senior Attorney Mary Anne Davies, Certified Legal Extern Agency for Health Care Administration 1940 North Monroe St., Ste. 60 Tallahassee, FL 32399-0792 Donald Partington, Esq. CLARK, PARTINGTON, ET AL. Post Office Box 13010 Pensacola, FL 32591-3010 Dr. Marm Harris Executive Director Board of Medicine Agency for Health Care Administration 1940 North Monroe Street Tallahassee, FL 32399-0770 Jerome W. Hoffman, Esq. General Counsel Agency for Health Care Administration 2727 Mahan Drive Tallahassee, FL 32309
The Issue This case is a bid protest filed by Petitioner, Laboratory Corporation of America Holdings ("LabCorp"), to contest the award of a contract by Respondent, Department of Revenue ("Department"), to Intervenor, Orchid Cellmark, Inc ("Orchid" or sometimes "OCI"). The issues are whether the Orchid bid was responsive to the bid criteria, whether Orchid is a responsible bidder, and whether the Department's award of the bid to Orchid should be deemed clearly erroneous, contrary to competition, arbitrary or capricious.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of the proceeding, including the Joint Pre-Hearing Stipulation of the parties, the following Findings of Fact are made: Petitioner, Laboratory Corporation of America Holdings, is a national testing laboratory with over 1,700 company-owned Patient Service Centers in the United States, including 176 in Florida. LabCorp has an existing contract with the State of Florida to provide Child Support Enforcement Genetic Testing Services in Department Regions 2, 3, 4 and 5, as well as Manatee County. These regions comprise the majority of the state. LabCorp has a longer history of providing paternity testing services using buccal swab collections (see discussion below) than any other party bidding on the RFP. Intervenor, Orchid Cellmark, Inc., is also a long-time provider of genetic testing and has been providing genetic parentage testing services since 1979. Orchid currently has a contract with the Department to provide such services in two areas of the state: Department Region 1 (comprising essentially all of Florida panhandle) and Dade County. Orchid has experience providing parentage services to governmental entities, including the states of Ohio, Georgia and Michigan. In its services to the State of Florida, Orchid has tested over 20,000 cases involving over 53,000 samples; it had zero misreported results to the Department related to those cases. Respondent, Department of Revenue, is the state agency responsible for the CSE program. CSE is one of six programs within the Department that interacts with clients on a one-to- one basis. The Department, unlike many state agencies, is organized using a business process model similar to the structure used in commercial and industrial sectors. Tasks and activities within the Department are aggregated from the bottom to the top, where the executive director is found. CSE became a function of the Department in 1994, moving from the Department of Children and Families. The purpose of the move was to emphasize collection of funds and to change from a caseworker model to a business process model. As a result, cases within CSE are handled by different offices or persons depending on the nature of the activity being addressed within that particular case, as opposed to having the entire case handled by a single assigned caseworker. CSE has five core processes: Case Management, Payment Processing and Fund Distribution, Child Support Aid, Establishment, and Compliance. CSE is organized into five geographic regions, each of which has service sites where CSE provides client services. One of the important services provided in these regions is genetic testing which is used to establish paternity. Inasmuch as the Department does not have the personnel or wherewithal to perform genetic testing internally, that function is contracted out to established providers of such services. CSE handles the establishment of the paternity process up to the point of genetic testing before allowing its contracted providers to perform the test. Once the test is completed, CSE continues with its duties concerning CSE. Each contracted provider of testing is responsible for the entire testing process: collecting specimens, transfer of specimens to a lab, maintaining chain of custody, conducting tests and reporting results to the Department. Further, each testing provider is responsible for seeing that a licensed phlebotomist is present to take the sample from the Department's client. Providers will not be paid if there are any failures during the testing process. On or about August 31, 2007, the Department put out the RFP soliciting bids for genetic testing of clients and associated persons within the CSE program. The contract period runs from the contract execution date (or January 1, 2008, whichever is later) until June 30, 2011, plus three optional one-year renewals. Bids from the following entities were received in response to the RFP: Orchid, Labcorp, Paternity Testing Corporation, and ReliaGene Technologies.1/ Each of the four bids was reviewed upon submission to determine whether they were responsive to the bid criteria. Each was found to be responsive. Thereafter, four Department employees designated as "evaluators," each reviewed the four bids (or proposals). The evaluators were: William Branch, Carey Abney, Mayra Levenson, and Scott Edmonds. The bids were scored pursuant to points assessed for each section of the RFP, as indicated in the table below: Technical Response Maximum Raw Score Weight Factor Maximum Points Possible Understanding the Required Services 5 20 100 Methodology Used for Providing the Services 5 25 125 Management Plan for Providing the Services 5 15 75 Experience and Qualifications 5 20 100 Cost Response 5 50 250 Based upon these evaluation criteria, the four proposals were scored by the evaluators as follows: LabCorp: Technical--306.25; Cost--250.00; Total--556.25 Orchid: Technical--368.75; Cost--241.94; Total--610.69 PTC: Technical--301.25; Cost--187.50; Total--488.75 ReliaGene: Technical--217.50; Cost--157.34; Total--374.84 LabCorp, whose cost proposal segment2/ was deemed superior to the other applicants, contests the total point assignment to Orchid on several bases. Each of those will be discussed below, but first a brief discussion of the underlying service in the contract: DNA testing. DNA Testing Versus Genetic Testing DNA testing for human identity first became available in the mid-to-late 1980s. DNA paternity testing began in approximately 1990. Early DNA paternity testing contracts bidded out by various states required DNA testing to be performed on blood drawn from the putative parents and the child for whom paternity was to be established. However, as the science in this area improved, other testing methods became available. At the present time, Florida requires paternity testing to be done by way of polymerase chain reaction (PCR) technology. PCR technology allows laboratories to perform DNA testing on a very small sample. This technology is utilized to evaluate human epithelial or "buccal" cells drawn from the inside of a person's cheek by use of buccal swabs. This process eliminates the need to draw venous blood from the subjects, expediting and easing the specimen collection process. The purpose section of the RFP includes this language: [CSE] is soliciting proposals for genetic testing services through this Request for Proposal for the purpose of conducting genetic testing services for the Department Program in child support cases throughout Florida. The Genetic Testing provided by the Provider is to conclusively determine the paternity of a child when paternity has not already been established. In certain circumstances in which paternity may have already been established, the court may order genetic tests in order to assist with its decision in a contested case. The general instructions to the RFP include language relating to misstatements made by vendors. The RFP states: All information provided by, and representations made by, the respondent are material and important and will be relied upon by the Buyer in awarding the Contract. Any misstatement shall be treated as fraudulent concealment from the Buyer of the true facts relating to submission of the bid. A misrepresentation shall be punished under law, including, but not limited to Chapter 817 of the Florida Statutes. Chapter 817, Florida Statutes, relates to Fraudulent Practices, including issuing statements under false pretenses and fraud. Relating to action that can be taken by the Department if a vendor submits a proposal with misstatements, Section 1.4.18 of the RFP states: FDOR will reject all proposals that FDOR deems to have a material defect. A material defect is any part of the proposed solution that violates a mandatory requirement and results in an unacceptable system or unacceptable risk. FDOR will reject proposals that fail to pass the Selected Mandatory Items Compliance Evaluation. Further, Paragraph 16 of the General Instructions to the RFP states: Minor Irregularities/Right to Reject. The Buyer reserves the right to accept or reject any and all bids, or separable potions thereof, and to waive any minor irregularity, technicality, or omission if the Buyer determines that doing so will serve the State's best interests. The Buyer may reject any response not submitted in the manner specified by the solicitation documents. With that backdrop, LabCorp maintains that Orchid provided false information in its bid proposal, thereby making the proposal non-responsive to the RFP. LabCorp's position is based on certain statements by Orchid concerning Orchid's history in the field of genetic testing. Orchid's History of DNA Testing Orchid, in its proposal, states, "Orchid Cellmark, Inc. (OCI), has been a leading provider of parentage and other family relationship DNA analysis since 1979, and is one of the largest providers of identity testing services in the world." It also states, "OCI has a history of providing the highest quality and most reliable DNA testing services identical to those outlined in this [RFP] for over 27 years." In actuality, DNA testing has not been in existence since 1979, a fact Orchid freely conceded at final hearing.3/ Orchid actually intended its statement to suggest that Orchid had been involved in "genetic" testing since 1979; that is also a true fact and more accurately reflects Orchid's history. None of the evaluators made any distinction between DNA testing versus genetic testing when reviewing the competing proposals. The phrase "DNA testing," in and of itself, does not appear to have been material or relevant to the assignment of scores by the evaluators under the scoring criteria. LabCorp also contends that Orchid provided misleading information by claiming to own a large number of testing sites when, in fact, Orchid generally does not own testing sites that it utilizes. Orchid's Network of Approved Sites In its proposal, Orchid stated several times that it had a network of over 5,000 established, approved sites for specimen collections. That network has been developed by Orchid as it performed services under various contracts around the United States (and Great Britain). Orchid does not own or lease any of the sites. Nonetheless, Orchid's proposal states, "Currently, OCI provides secure and convenient specimen collection services at 127 of its own sites in addition to many Service Centers designated by the State." Orchid distinguishes the phrases "own sites" from "owned sites" by saying that the former means a site used by them on a regular basis. This definition is supported by the attachment to Orchid's proposal which lists the various sites. That list includes not only state office buildings, but also hospitals and other health facilities. (In fact, Orchid lists as part of its 5,000 sites some sites actually owned by LabCorp.) It is clear Orchid is not claiming ownership of those places. Orchid's witnesses' testimony concerning this issue is credible. There was no representation by Orchid that it had obtained state or other government approval for its intended collection sites. Rather, the sites were "approved" internally by Orchid, representing the fact that such sites had been used by Orchid previously and found to be sufficient for their purposes. None of the evaluators based their scoring on whether Orchid owned or leased a collection site versus simply having access to them based on past relationships, nor did calling the sites "approved" sway the evaluators. Failure of Orchid to Identify Subcontracted Phlebotomists LabCorp also contends that Orchid failed to properly identify and provide information for all of its intended subcontract-phlebotomists. The RFP, at section 2.5, states: Subcontractors may be used to perform work under this Contract. If a proposer intends to use subcontractors, the proposer must identify in the proposal the following: complete name of the subcontractor, complete address of the subcontractor, type of work the subcontractor will be performing, percentage of work the subcontractor will be performing, evidence that the subcontractor holds a valid business license, a written statement, signed by each proposed subcontractor, that clearly verifies that the subcontractor is committed to render the services required by the Contract. A proposer's failure to provide this information may cause the FDOR to consider their proposal non-responsive and reject it. The substitution of one subcontractor for another may be made only at the direction and prior written approval of the Contract Manager for the FDOR. Subcontractors of the Provider must adhere to the same level of qualifications and standards as required of the Provider. LabCorp maintains that Orchid violated this provision of the RFP by failing to identify its phlebotomists as subcontractors and failing to provide all the required information about such subcontractors. LabCorp does most of its collections and testing using its own employees. The company occasionally subcontracts with other vendors to provide some services. LabCorp, in its proposal, identified a subcontractor with whom it intended to do business under the contract with the State of Florida. All required information concerning that subcontractor was supplied to the Department in LabCorp's response. Conversely, Orchid has no employees who do actual collecting of samples. Rather, Orchid relies on the services of persons and entities which operate independently of Orchid. Some of these independent collectors are located within the network of 5,000 sites addressed by Orchid in its proposal. The collectors for the contract at issue are yet to be named or will be contracted once the award has become final. This arrangement (using independent collectors for doing collections) has worked well for Orchid during its historical operations and particularly during its current contract with the State of Florida in Region 1 and Dade County. Orchid intends to use the same arrangement for collections under the contract currently in dispute. Orchid has an agreement it utilizes when hiring third-party sample collectors. The agreement is part of the Collector Manual employed by Orchid and distributed to many of its collector sites. In response to emails from the Department concerning its current contract with Orchid, Orchid was asked whether a certain collector was a subcontractor and, if so, to provide certain required information about that collector. In response, Orchid emailed the Department a list of collectors designated either as a "Business" or as an "Independent Contractor." Apparently Orchid's distinction between independent contractors and businesses is that individuals (real persons as opposed to business entities) are independent contractors. Since Orchid does not employ subcontractors, this list was submitted in response to the inquiry instead of a list of subcontractors (which it does not have). The term "subcontractor" is not defined in the RFP. It is defined in Black's Law Dictionary as: One who takes portion of a contract from principal contractor or another subcontractor. . . One who has entered into a contract, express or implied, for the performance of an act with the person who has already contracted for the performance. . . One who takes from the principal or prime contractor a specific part of the work undertaken by the principal contractor. Clearly, Orchid intends to allow some non-affiliated persons to perform some portions of the contracted work under the RFP. However, Orchid has always referred to such persons as independent contractors, as evidenced by its response to a Department email in March 2007. In its email, the Department has asked Orchid whether a certain business entity (Accurate DNA of Northeast Florida) was Orchid's subcontractor. In response, Orchid provided a list of active specimen collectors that it utilized at that time. The list contained the requisite information (Federal ID number, address, name, etc.), but identified the entities as either businesses or independent contractors. The Department then thanked Orchid for providing "your list of subcontractors." The RFP addresses phlebotomists a number of times. However, in only one section (5.1.2.2.5) does the RFP specifically address "sub-contracted phlebotomists." In that section, providers are directed to insure that both its phlebotomists and subcontracted phlebotomists maintain a professional appearance and demeanor while at a collection site. It is impossible to distinguish the semantics in the discussion between Orchid and the Department on this issue to ascertain whether each was contemplating the same thing. Nonetheless, in the RFP at issue, Orchid did not provide a list of subcontractors, but the Department exercised its discretion and deemed the proposal responsive nonetheless.4/ The Department intended to designate specific collection sites upon final award of the contract. Thereafter, the winning bidder would be expected to propose additional sites as necessary to provide services to meet the needs of the Department. It is reasonable to presume that a bidder would not be able to list all of its intended phlebotomists at the time of the initial bid. And, the Department's deputy director for the CSE program testified that the Department did not presume or expect a vendor to list its intended phlebotomists. In its review of proposals, the Department made a determination as to each bidder's qualifications and experience. It did not attempt to determine if one bidder was more qualified and experienced than another. Rather, it simply determined that a bidder had enough experience to carry out the terms of the contract. Both Orchid and LabCorp were found to meet the necessary experience threshold. A side-by-side comparison of the relative experience and qualifications of Orchid versus LabCorp was irrelevant to the award of the contract.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Department of Revenue upholding its award of the contract to Orchid. DONE AND ENTERED this 13th day of June, 2008, in Tallahassee, Leon County, Florida. R. BRUCE MCKIBBEN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 13th day of June, 2008.
