The Issue Whether, based upon a preponderance of the evidence, the Agency for Health Care Administration (AHCA) lawfully assigned conditional licensure status to Harbour Health Center for the period June 17, 2004, to June 29, 2004; whether, based upon clear and convincing evidence, Harbour Health Center violated 42 Code of Federal Regulations (C.F.R.) Section 483.25, as alleged by AHCA; and, if so, the amount of any fine based upon the determination of the scope and severity of the violation, as required by Subsection 400.23(8), Florida Statutes (2004).
Findings Of Fact Based upon stipulations, deposition, oral and documentary evidence presented at the final hearing, and the entire record of the proceeding, the following relevant findings of fact are made: At all times material hereto, AHCA was the state agency charged with licensing of nursing homes in Florida under Subsection 400.021(2), Florida Statutes (2004), and the assignment of a licensure status pursuant to Subsection 400.23(7), Florida Statutes (2004). AHCA is charged with the responsibility of evaluating nursing home facilities to determine their degree of compliance with established rules as a basis for making the required licensure assignment. Additionally, AHCA is responsible for conducting federally mandated surveys of those long-term care facilities receiving Medicare and Medicaid funds for compliance with federal statutory and rule requirements. These federal requirements are made applicable to Florida nursing home facilities pursuant to Florida Administrative Code Rule 59A-4.1288, which states that "[n]ursing homes that participate in Title XVIII or XIX must follow certification rules and regulations found in 42 C.F.R. §483, Requirements for Long Term Care Facilities, September 26, 1991, which is incorporated by reference." The facility is a licensed nursing facility located in Port Charlotte, Charlotte County, Florida. Pursuant to Subsection 400.23(8), Florida Statutes (2004), AHCA must classify deficiencies according to the nature and scope of the deficiency when the criteria established under Subsection 400.23(2), Florida Statutes (2004), are not met. The classification of any deficiencies discovered is, also, determinative of whether the licensure status of a nursing home is "standard" or "conditional" and the amount of administrative fine that may be imposed, if any. Surveyors note their findings on a standard prescribed Center for Medicare and Medicaid Services (CMS) Form 2567, titled "Statement Deficiencies and Plan of Correction" and which is commonly referred to as a "2567" form. During the survey of a facility, if violations of regulations are found, the violations are noted and referred to as "Tags." A "Tag" identifies the applicable regulatory standard that the surveyors believe has been violated, provides a summary of the violation, sets forth specific factual allegations that they believe support the violation, and indicates the federal scope and severity of the noncompliance. To assist in identifying and interpreting deficient practices, surveyors use Guides for Information Analysis Deficiency Determination/Categorization Maps and Matrices. On, or about, June 14 through 17, 2004, AHCA conducted an annual recertification survey of the facility. As to federal compliance requirements, AHCA alleged, as a result of this survey, that the facility was not in compliance with 42 C.F.R. Section 483.25 (Tag F309) for failing to provide necessary care and services for three of 21 sampled residents to attain or maintain their respective highest practicable physical, mental, and psychosocial well-being. As to the state requirements of Subsections 400.23(7) and (8), Florida Statutes (2004), and by operation of Florida Administrative Code Rule 59A-4.1288, AHCA determined that the facility had failed to comply with state requirements and, under the Florida classification system, classified the Federal Tag F309 non-compliance as a state Class II deficiency. Should the facility be found to have committed any of the alleged deficient practices, the period of the conditional licensure status would extend from June 17, 2004, to June 29, 2004. Resident 8 Resident 8's attending physician ordered a protective device to protect the uninjured left ankle and lower leg from injury caused by abrasive contact with the casted right ankle and leg. Resident 8 repeatedly kicked off the protective device, leaving her uninjured ankle and leg exposed. A 2.5 cm abrasion was noted on the unprotected ankle. The surveyors noted finding the protective device in Resident 8's bed but removed from her ankle and leg. Resident 8 was an active patient and had unsupervised visits with her husband who resided in the same facility but who did not suffer from dementia. No direct evidence was received on the cause of the abrasion noted on Resident 8's ankle. Given Resident 8's demonstrated propensity to kick off the protective device, the facility should have utilized a method of affixing the protective device, which would have defeated Resident 8's inclination to remove it. The facility's failure to ensure that Resident 8 could not remove a protective device hardly rises to the level of a failure to maintain a standard of care which compromises the resident's ability to maintain or reach her highest practicable physical, mental or psychosocial well-being. The failure to ensure that the protective device could not be removed would result in no more than minimal discomfort. Resident 10 Resident 10 has terminal diagnoses which include end- stage coronary artery disease and progressive dementia and receives hospice services from a local Hospice and its staff. In the Hospice nurse's notes for Resident 10, on her weekly visit, on May 17, 2004, was the observation that the right eye has drainage consistent with a cold. On May 26, 2004, the same Hospice nurse saw Resident 10 and noted that the cold was gone. No eye drainage was noted. No eye drainage was noted between that date and June 2, 2004. On June 3, 2004, eye drainage was noted and, on June 4, 2004, a culture of the drainage was ordered. On June 7, 2004, the lab report was received and showed that Resident 10 had a bacterial eye infection with Methicillin Resistant Staphylococcus Aureus (MRSA) bacteria. On June 8, 2004, the attending physician, Dr. Brinson, referred the matter to a physician specializing in infectious disease, and Resident 10 was placed in contact isolation. The infectious disease specialist to whom Resident 10 was initially referred was not available, and, as a result, no treatment was undertaken until a second specialist prescribed Bactrim on June 14, 2004. From June 8, 2004, until June 14, 2004, Resident 10 did not demonstrate any outward manifestations of the diagnosed eye infection. A June 9, 2004, quarterly pain assessment failed to note any discomfort, eye drainage or discoloration. In addition to noting that neither infectious control specialist had seen Resident 10, the nurses notes for this period note an absence of symptoms of eye infection. Colonized MRSA is not uncommon in nursing homes. A significant percentage of nursing home employees test positive for MRSA. The lab results for Resident 10 noted "NO WBC'S SEEN," indicating that the infection was colonized or inactive. By placing Resident 10 in contact isolation on June 8, 2004, risk of the spread of the infection was reduced, in fact, no other reports of eye infection were noted during the relevant period. According to Dr. Brinson, Resident 10's attending physician, not treating Resident 10 for MRSA would have been appropriate. The infectious disease specialist, however, treated her with a bacterial static antibiotic. That is, an antibiotic which inhibits further growth, not a bactericide, which actively destroys bacteria. Had this been an active infectious process, a more aggressive treatment regimen would have been appropriate. Ann Sarantos, who testified as an expert witness in nursing, opined that there was a lack of communication and treatment coordination between the facility and Hospice and that the delay in treatment of Resident 10's MRSA presented an unacceptable risk to Resident 10 and the entire resident population. Hospice's Lynn Ann Lima, a registered nurse, testified with specificity as to the level of communication and treatment coordination between the facility and Hospice. She indicated a high level of communication and treatment coordination. Dr. Brinson, who, in addition to being Resident 10's attending physician, was the facility's medical director, opined that Resident 10 was treated appropriately. He pointed out that Resident 10 was a terminally-ill patient, not in acute pain or distress, and that no harm was done to her. The testimony of Hospice Nurse Lima and Dr. Brinson is more credible. Resident 16 Resident 16 was readmitted from the hospital to the facility on May 24, 2004, with a terminal diagnosis of chronic obstructive pulmonary disease and was receiving Hospice care. Roxanol, a morphine pain medication, had been prescribed for Resident 16 for pain on a pro re nata (p.r.n.), or as necessary, basis, based on the judgment of the registered nurse or attending physician. Roxanol was given to Resident 16 in May and on June 1 and 2, 2004. The observations of the surveyor took place on June 17, 2004. On June 17, 2004, at 9:30 a.m., Resident 16 underwent wound care treatment which required the removal of her sweater, transfer from sitting upright in a chair to the bed, and being placed on the left side for treatment. During the transfer and sweater removal, Resident 16 made noises which were variously described as "oohs and aahs" or "ows," depending on the particular witness. The noises were described as typical noises for Resident 16 or evidences of pain, depending on the observer. Nursing staff familiar with Resident 16 described that she would demonstrate pain by fidgeting with a blanket or stuffed animal, or that a tear would come to her eye, and that she would not necessarily have cried out. According to facility employees, Resident 16 did not demonstrate any of her typical behaviors indicating pain on this occasion, and she had never required pain medication for the wound cleansing procedure before. An order for pain medication available "p.r.n.," requires a formalized pain assessment by a registered nurse prior to administration. While pain assessments had been done on previous occasions, no formal pain assessment was done during the wound cleansing procedure. A pain assessment was to be performed in the late afternoon of the same day; however, Resident 16 was sleeping comfortably. The testimony on whether or not inquiry was made during the wound cleansing treatment as to whether Resident 16 was "in pain," "okay," or "comfortable," differs. Resident 16 did not receive any pain medication of any sort during the period of time she was observed by the surveyor. AHCA determined that Resident 16 had not received the requisite pain management, and, as a result, Resident 16’s pain went untreated, resulting in harm characterized as a State Class II deficiency. AHCA's determination is not supported by a preponderance of the evidence. In the context that the surveyor considered what she interpreted as Resident 16's apparent pain, deference should have been given to the caregivers who regularly administered to Resident 16 and were familiar with her observable indications of pain. Their interpretation of Resident 16's conduct and their explanation for not undertaking a formal pain assessment are logical and are credible.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding: The facility's failure to secure the protective device to Resident 8's lower leg is not a Class II deficiency, but a Class III deficiency. The facility's care and treatment of Residents 10 and 16 did not fall below the requisite standard. The imposition of a conditional license for the period of June 17 to June 29, 2004, is unwarranted. The facility should have its standard licensure status restored for this period. No administrative fine should be levied. DONE AND ENTERED this 3rd day of June, 2005, in Tallahassee, Leon County, Florida. S JEFF B. CLARK Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 3rd day of June, 2005. COPIES FURNISHED: Karen L. Goldsmith, Esquire Goldsmith, Grout & Lewis, P.A. 2180 North Park Avenue, Suite 100 Post Office Box 2011 Winter Park, Florida 32790-2011 Eric Bredemeyer, Esquire Agency for Health Care Administration 2295 Victoria Avenue, Room 346C Fort Myers, Florida 33901 Richard Shoop, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Station 3 Tallahassee, Florida 32308 William Roberts, Acting General Counsel Agency for Health Care Administration Fort Knox Building, Suite 3431 2727 Mahan Drive Tallahassee, Florida 32308
The Issue Whether Certificate of Need (CON) Application No. 10009, filed by HealthSouth Rehabilitation Hospital of Ocala, LLC (the applicant or HS-Ocala) to establish a new freestanding 40-bed comprehensive medical rehabilitation (CMR) hospital in Marion County, Agency for Health Care Administration (AHCA or Agency) District 3, satisfies, on balance, the applicable statutory and rule review criteria for approval.
Findings Of Fact The Parties The Applicant HS-Ocala is a wholly-owned subsidiary of HealthSouth Corporation (HealthSouth). Founded in 1984, HealthSouth is the nation's largest provider of inpatient rehabilitative healthcare services in terms of revenue, number of hospitals, and patients treated. HealthSouth employs over 22,000 people in approximately 93 rehabilitation hospitals, six long-term care hospitals, approximately 48 outpatient rehabilitation satellites and 25 hospital-based home health agencies across 26 states and Puerto Rico. All HealthSouth facilities, including the facilities in Florida, are either accredited by the Joint Commission (f/k/a the Joint Commission on Accreditation of Healthcare Organizations – JCAHO) or the Commission on Accreditation of Rehabilitation Facilities (CARF) or both. HealthSouth has created specific programs for different conditions, including a specialized Stroke Rehabilitation Program nationwide. HealthSouth is one of only four hospital companies receiving Joint Commission Stroke Rehabilitation Certification: 21 of 25 hospitals that have this certification are HealthSouth facilities. HealthSouth owns and operates nine freestanding CMR hospitals in Florida. HealthSouth also owns and operates a 40- bed long-term acute care hospital in Sarasota and owns eight outpatient centers in the state. HealthSouth will provide patients with an interdisciplinary team that includes the services of a physician/physiatrist, physical therapists, occupational therapists, speech/language pathologists, psychologists, rehabilitative nurses, case managers, therapeutic recreation specialists, dieticians, and respiratory therapists. Shands Shands Teaching Hospital and Clinics, Inc., was incorporated in 1979 as a Florida not-for-profit corporation. Shands is located in Gainesville, Florida, and operates a health care delivery system that includes the flagship teaching hospital for the School of Medicine of the University of Florida and Shands Rehab Hospital (a division of Shands), a 40-bed freestanding inpatient rehabilitation hospital. Shands serves patients throughout District 3, as well as other areas of Florida. Co-located in the same building with Shands Rehab Hospital is Shands Vista (a division of Shands), an inpatient psychiatric and substance abuse facility licensed to operate 81 beds, of which 57 are psychiatric and 24 are substance abuse. Shands also operates Shands AGH, a 367-bed acute care community hospital in Gainesville; Shands at Lake Shore, a 99- bed acute care community hospital located in Starke, Florida; and Shands Live Oak, a 15-bed acute care hospital located in Live Oak, Florida. Another subsidiary of Shands is Shands Jacksonville Medical Center, a 696-bed teaching hospital in Jacksonville, Florida. Shands Rehab is accredited by the Joint Commission, the Florida Brain and Spinal Cord Injury Program and CARF. Shands Rehab offers a full array of CMR services. Patients at Shands Rehab are served by an interdisciplinary team. LRMC LRMC is a 309-bed acute care hospital located in Leesburg, Florida. LRMC provides a broad array of services including open-heart surgery and neurosurgery and also offers stroke specialty service. LRMC's CMR unit, also known as the Ohme Rehabilitation Center (Ohme), is a 15-bed hospital-based CMR unit located in its North Campus in Leesburg, Florida. Ohme is accredited by the Joint Commission and CARF. CARF has also accredited Ohme as a stroke specialty program. LRMC is part of the Central Florida Health Alliance, which also includes The Villages Regional Hospital (120 beds) located within the development known as The Villages, located in Lake, Sumter, and Marion Counties, and north of LRMC. The Villages is located approximately 15-to-20 minutes from LRMC. Ohme's patients work with an interdisciplinary team of professionals, including a medical director, case managers, registered nurses, rehabilitation techs, certified nursing assistants, physical therapists, occupational therapists, speech/language pathologists, recreational therapists, rehabilitation therapists, social workers, and dieticians. AHCA AHCA is the state health planning agency and administers the CON program pursuant to the Health Facility and Services Development Act, Sections 408.031-.0455, Florida Statutes. CMR Services and Facilities CMR facilities are licensed pursuant to Chapter 395, Florida Statutes. CMR services are defined by Section 408.032(17), Florida Statutes, as tertiary health services, which "means a health service which, due to its high level of intensity, complexity, specialized or limited applicability, and cost should be limited to, and concentrated in, a limited number of hospitals to ensure the quality, availability, and cost- effectiveness of such service." Id. The services are integrated and intensive, provided in an inpatient setting by a multidisciplinary team to patients with severe physical disabilities, such as stroke, spinal cord or brain injury, congenital deformities, amputation, major multiple trauma, femur fracture, neurological disorders, polyarthritis, and burns. The patients served by CMR facilities are clinically complex and require an acute care level of nursing and rehabilitative therapies. Facilities such as the one proposed are reimbursed prospectively by the Medicare program under the inpatient rehabilitation prospective payment system, 42 C.F.R. Part 412, and are exempt from the Medicare inpatient prospective patient system for short-term acute care inpatient hospitals. To be eligible for Medicare reimbursement as an inpatient rehabilitation facility, 60 percent of the patients admitted to a CMR facility must have a medical condition that falls within one or more of 13 diagnoses established by the Centers for Medicare and Medicaid Services (CMS), which indicate a need for intensive rehabilitative services. These are commonly known as the "CMS-13" criteria. The CMS-13 criteria include: stroke, spinal cord injury, congenital deformity, amputation, major multiple trauma, femur fracture (hip fracture), brain injury, neurological disorders, burns, active polyarthritis, systemic vasculidities, advanced osteoarthritis, and knee or hip replacement with additional co-morbidities. If a CMR facility falls below the 60 percent threshold, it will be reimbursed by CMS as a short-term acute care inpatient hospital. In addition to the above requirements, the federal government mandates that a patient admitted to a CMR facility must require an acute care level of nursing services; that physicians determine the admission of the patient to be medically necessary; and that the patient be able to tolerate three hours of therapy services per day (900 minutes over five days) over a five-day period administered by licensed therapists. Therapy services included in the three-hour requirement include physical, occupational, speech, recreational, neuropsychological, and prosthetics and orthotic. Services or treatments rendered by aides may not be included in the three-hour per day minimum therapy requirement; however, services or treatments provided by licensed assistants can be included in the three-hour per day requirement. Unlike acute care services, access to CMR services is non-emergent. The process used to identify and admit patients from an acute care setting to a CMR facility begins early in the patient's stay, e.g., at an acute care facility. (Patients can be admitted from other entities or from home, but most are admitted from hospitals.) Typically, a patient will be assessed upon admission to an acute care hospital to determine what services they will need upon leaving the hospital. The assessment process involves discharge planners, case managers, physicians, nurses, the patient's insurance provider, and the patient and his or her family. In making the decision as to where a patient should be discharged, those involved in the decision-making process determine the amount of therapy the patient can tolerate; the age of the patient; and any co-morbidities or other conditions the patient may have. Once a decision is made as to what types of post-acute care services are needed, the acute care hospital's discharge planner or case manager is charged with coordinating the required care for the patient. CMR services include the close involvement of a physician (physiatrist) and the availability of 24-hour nursing care because the patients requiring CMR services typically have significant medical conditions and co-morbidities. In the CMR setting, nurses are trained to be a part of the entire therapeutic team. In coordinating post-acute care for a patient, some Marion County acute care hospitals such as Munroe Regional use the Allscripts or ECIN electronic referral system. Other local hospitals, such as Ocala Regional and West Marion, do not. However, the director of admissions at TimberRidge has access to patient charts at Ocala Regional and West Marion. (It appears that eight Ocala-area SNFs are listed on the ECIN system.) The ECIN system allows hospitals to transmit a patient's medical information to post-acute care facilities for consideration for admission in electronic format. The system also allows a hospital and the potential discharge facility to communicate if additional information or explanation is needed. The system is viewed as a valuable tool because it allows CMR facilities to obtain detailed information on potential admissions without having to travel to the referring facility to review medical records. The Allscripts system is also utilized by a CMR facility to assist with placement decisions at the time the patient is discharged from the CMR facility. Once the patient is referred to a CMR facility, the CMR admissions team receives the patient's information and begins its own assessment to determine whether the patient is a good candidate for admission. Typically, a nurse liaison is assigned to a referred case and gathers information on the patient to be used in the admissions decision. A patient assessment sheet is typically completed and the CMR admitting physician will be called on to review the information. The admitting physician will look for information regarding the nature and extent of a patient's illnesses and whether the patient had any complications that could affect the patient's ability to participate in rehabilitation. The ability to participate in rehabilitation is significant to a CMR facility because the patient is typically expected to begin exercising as soon as possible after admission. All of the above factors are considered in addition to the CMS-13 criteria. Even if a patient falls within one of the CMS-13 diagnosis codes, the CMR facility staff also determines if the patient requires at least two disciplines of therapy as required by Medicare. A patient who does not meet this criterion may not be considered a candidate for admission to a CMR facility notwithstanding the fact that he or she may fall within one of the CMS-13 diagnoses. Utilizing all of the above indicators, a final decision is made and communicated to the acute care facility or other referring entity to coordinate the transfer of the patient or re-refer the patient to a more appropriate setting. When a patient is admitted to a CMR facility, a patient assessment instrument that captures the patient's diagnostic and functional abilities must be completed. During this admission assessment process, the patient's level of independent functioning is measured for a number of activities. This comprehensive review of the patient's functions is performed within three days of admission. This measurement is known as the patient's functional independence measurement (FIM) score. The FIM score is both a quality and outcome and progress measure. The FIM measures 18 items on a scale of 1 (most severe) to 7 (independent). FIM scores are not utilized in the skilled nursing home industry, which has made it more difficult to compare the care delivered in CMR facilities and skilled nursing homes. All CMR providers utilize FIM scores. The FIM score in part determines the level of reimbursement the facility receives from Medicare because it indicates that the patient will typically require more services. FIM scores are measured again upon discharge. The Proposal HS-Ocala proposes to build a new 40-bed freestanding CMR hospital in Ocala, Florida, at a cost of $19,620,449 in a 49,900 square foot facility. All of the beds will be private. This prototype has been built by HealthSouth at least ten times since 2001, including twice within Florida. HS-Ocala plans to build the hospital on 6.2 acres located on Southwest 19th Avenue Road in, Ocala, Florida. The property is a portion of the approximately 7.63-acre tract identified as Marion County tax parcel number 23721-003-00. HealthSouth has an active contract to purchase the property. The projected construction cost contained in the application is $9,237,800 or $185.12 per gross square feet. The applicant agreed to condition the proposed project on the following: providing a minimum of 2.5 percent of the hospital's annual inpatient patient days to Medicaid and charity patients; implementing a Stroke Rehabilitation Program to begin upon licensure; obtaining Joint Commission Certification of its stroke rehabilitation program; and providing an AutoAmbulator and other appropriate technology upon licensure. In its preliminary approval of the application, AHCA conditioned the approval on the conditions indicated above, and that the facility is located in close proximity to the intersections triangulated by Interstate 75, SR 200, SR 40, and U.S. Highway 27. The applicant proposes to offer a full range of CMR services. The applicant does not propose to have a spinal cord or brain injury unit. These patients are typically transferred to a facility like Shands Rehab consistent with the tertiary nature of CMR services. HealthSouth CMR facilities have traditionally offered high quality CMR services at all of its facilities, including the nine facilities in Florida. Consistent with the general description of CMR services provided herein, HealthSouth has developed diagnostically distinct programs which offer specialized inpatient and outpatient services with an interdisciplinary approach. These programs are developed and implemented at each HealthSouth facility consistent with the needs of the market. These specific programs improve outcomes for the patients. HealthSouth's interdisciplinary therapy team primarily consists of physical, occupational, and speech therapists. The physical therapy team integrates with the other interdisciplinary team members, including physicians, nurses, prosthetists, orthotics, and other team members. From the initial assessment, the interdisciplinary team develops a plan of care through treatment interventions provided to the patient. A comprehensive review of the patient's functionality, including the FIM score determination, is performed on each patient is performed within three days of admission. Throughout the patient's stay, patient goals are constantly being assessed and implemented. Conferences are held with the patient and family to make sure the goals are being accomplished. The team also evaluates the home setting and prepares the patient and the family for discharge. HealthSouth's main mission is to provide quality outcomes. The outcomes are measured on admission, throughout the patient's stay and on discharge. HealthSouth takes the necessary measures to assure that it provides the patient with at least three hours of therapy a day. HealthSouth uses state-of-the-art technology as part of its ongoing quality initiatives. The Ocala facility will have access to state-of-the-art equipment including the AutoAmbulator, a device developed and implemented by HealthSouth and only offered at most of the HealthSouth facilities in the United States. (The AutoAmbulator is a sophisticated treadmill using the therapeutic concept of body weight supported ambulation and robotics to help patients with gait disorders. The equipment has produced quality outcomes for HealthSouth patients. There are no studies that compare the use of this device with other similar devise such as a LocoMat.) HealthSouth also proposes to offer other technology such as the Balance Master (assessment of balance); EquiTest (used to diagnose and treat imbalance and postural instability); Visipitch (computerized analysis of voice); SaeboFlex wrist splint and exercise station (promotes increased function in shoulder, wrist, elbow, and hand); Interactive Metronome (promotes motor learning); and VitalStim (targets swallow function); and Bioness (helps patients regain lost mobility for upper and lower extremities). See T. 707-16. HealthSouth tracks and measures quality provided to the patient pursuant to its contract with the Uniform Data System for Medical Rehabilitation, which is the most widely used system in the country. This system tracks function outcomes for CMR patients through the use of FIM data captured from approximately 900 rehabilitation hospitals in the United States. HealthSouth monitors patient satisfaction outcomes. Each HealthSouth CMR facility has a quality review council that examines patient safety measures, FIM outcome data, patient satisfaction data, and infection controls. HealthSouth encourages family participation before admission, during treatment, and after the patient is discharged from one of its CMR facilities. Travel barriers may impact the ability of family members to access a CMR facility. District 3 and the Proposed Service Area (PSA) District 3 is the largest health service planning district in the state of Florida composed of 16 counties, including Hamilton, Suwannee, Lafayette, Dixie, Columbia, Gilchrist, Levy, Union, Bradford, Putnam, Alachua, Marion, Citrus, Hernando, Sumter, and Lake. § 408.032(5), Fla. Stat. District 3 encompasses more than 11,000 square miles with nearly 1.6 million residents. Much of District 3 is rural covering approximately 20 percent of the state's land areas, but home to approximately eight percent of the state's population. Marion County is the most populated county within District 3 with more than 317,000 residents. There is a natural geographic barrier in the area with the forest to the east of Marion County. The service area for the proposed facility defined in the application comprises zip codes in Marion County and the easternmost portion of Levy County. A portion of zip code 32784 is located in Lake County. As of calendar year 2007, the total population for all of the zip codes within the PSA was 334,868 and is projected to increase to 377,543 by calendar year 2012, a 12.7 percent increase. The applicant projects receiving approximately 95 percent of its patients from within the PSA. Ms. Kelleher and Ms. Greenberg developed the PSA with the assistance of Wanda Pearman of Dixon Hughes. The process included the creation of various maps outlining the service area as it evolved prior to filing the application. The process utilized an August 2007 market analysis performed by Dixon Hughes on 27 or 28 markets across the United States, including the Marion County/Ocala market. The August 2007 market analysis was not performed specifically for the purpose of the CON Application. Rather, it was performed on potential markets across the country as a "50,000-foot" level market analysis of demographics and lack of CMR services in an effort to identify potential markets. HealthSouth would use the information to look further into each identified potential market and decide what the appropriate service area would be. Beginning on January 22, 2008, a number of zip codes were realigned and deleted from the original Dixon Hughes document to form the service area identified in the application. The HealthSouth team examined existing in and out- migration patterns for existing hospitals within Marion County. Existing roadways were driven. Local providers, including local doctors, were contacted and provided favorable comments regarding the proposed project. The Villages were excluded because they were not in close proximity to Ocala. Any area south of the Marion County line was also excluded due to travel distances. The analysis led to the conclusion that the Ocala area has developed into its own medical market and that the placement of a CMR facility in the Ocala area would not overlap with Ohme's or Shands Rehab's service areas such that their CMR services (quality of care, e.g.) would be compromised in any significant way. It was also important to the applicant that trauma patients, spinal cord and brain injury patients would continue to go to the Shands system for their post-acute care. From a demographic standpoint, 2007 data indicated that approximately 23 percent of the residents in the Ocala area are 65 years of age or older (increasing to approximately 25 percent by 2012) compared to the statewide average of 17 percent. This age cohort is expected to increase approximately 20 percent between 2007 and 2012 with some zip codes increasing between 24 and 37 percent. Approximately 75 percent of CMR patients are covered under Medicare and Medicare managed care. Statutory and Rule Review Criteria Section 408.035(1)(a): The need for the health care facilities and health services being proposed. "A favorable need determination for proposed new or expanded [CMR] inpatient services shall not normally be made unless a bed need exists according to the numeric need methodology in paragraph (5)(c) of this rule." Fla. Admin. Code R. 59C-1.039(5)(a). "The future need for [CMR] inpatient services shall be determined twice a year and published by the agency as a fixed need pool for the applicable planning horizon." Fla. Admin. Code R. 59C-1.039(5)(b). Pursuant to the Agency's need methodology, Florida Administrative Code Rule 59C-1.039(5)(c), the Agency published a fixed need pool of zero (0) for CMR beds for District 3 in the CON batching cycle at issue in this case in the Florida Administrative Weekly, Volume 34, Number 4 (January 25, 2008). By Agency precedent, this determination creates a presumption of no need. The applicant seeks approval based on "not normal" circumstances. Generally, pursuant to Subsection 408.035(1)(a), the need for a tertiary health service such as CMR is to be determined on a district-wide basis. See T. 2324, 2327-2332. But see Conclusions of Law 349-52. By its express terms, Subsection 408.035(1)(b) requires consideration of the stated criteria in reference to the service district of the applicant. Using the applicant's service area approach yields bed need projections in excess of those established by the Agency's rule, in large part because the applicant established a PSA using a series of zip codes in an area where there is no existing CMR facility. The applicant ultimately concluded that the PSA is a unique (and not-normal) market for which CMR services are unavailable. The Agency preliminarily approved the project based on the applicant's representations in its CON application of need for the service in the 25 zip code area. See generally T. 2327- 2390. The Agency considered several factors including the disparity in the "conversion rate" of patients who reside in the 25 zip codes comprising the applicant's PSA compared to other areas of the state where HealthSouth operates CMR hospitals; transportation difficulties; letters of support; and physician concerns in transferring patients to existing hospitals in the District. B. Section 408.035(1)(b): The availability, quality of care, accessibility, and extent of utilization of existing health care facilities and health services in the service district of the applicant. Availability, accessibility, and utilization There are four acute care hospitals, ten skilled nursing facilities, and one long-term care hospital within the PSA. The acute care hospitals are: Munroe Regional Medical Center (Munroe Regional)(421 beds); Ocala Regional Medical Center (ORMC) (200 beds); West Marion Community Hospital (West Marion)(70 beds), a satellite of Ocala Regional Medical Center; and Nature Coast Regional Hospital (Nature Coast) (40 beds). The long-term care hospital, Kindred Hospital Ocala (31 beds), is located on the fifth floor of Munroe Regional. There is no persuasive evidence that area hospitals are experiencing problems placing patients in post-acute care settings. Munroe Regional has an average daily census of approximately 300 and offers open-heart surgery, cardiovascular services and neurological services, and orthopedic surgery. HS-Ocala's application contained numerous letters of support, including letters from ORMC and West Coast.2/ See HS Ex. 1 at 663-705 and JPS at HealthSouth's exhibit list, p. 1, n.1. Most of the letters were not authenticated. There was no objection to letters of support submitted by Drs. Tabbaa and Canon and the letter of support submitted by Linda F. Berry, RN, PCRM, employed with the University of Florida College of Medicine, Department of Orthopaedics and Rehabilitation, apparently as a case manager. Id. T. 497-98, 504-505, 525-27, 579; HS Ex. 1 at 664 and 667; HS Ex. 24. There are three existing CMR facilities in District 3. HealthSouth Rehabilitation Hospital-Spring Hill (Spring Hill), in Hernando County, is a 70-bed (16 private and 54 semi- private rooms) freestanding rehabilitation hospital and has been approved to add ten beds pursuant to a CON exemption. Spring Hill is approximately 70 miles from the downtown Ocala area. Spring Hill's primary service area is Hernando County and a small piece of Pasco County and Spring Hill receives 85-to-90 percent of its patients from its primary service area. (In seeking approval of the original 60-bed Spring Hill hospital around the Fall of 1999, the applicant used Marion County data to support its argument that there was a need for the facility and included Marion County as part of its defined service area.) Between 2004 and 2007, Spring Hill comprised 60 beds, a majority of which were semi-private. During that same time period, the average daily census at Spring Hill ranged from 50 to 57, with the average number of available beds ranging from three to ten. In 2008 and thus far in 2009, Spring Hill was at 92 and 94 percent occupancy, respectively, with an ADC of 64 and 66 for these years for 70 beds. Shands Rehab Hospital is a 40-bed freestanding rehabilitation hospital, and is part of the larger Shands Health Care System (with over 1,000 acute care beds) described above and which provides over 70 percent of the referrals to the Shands Rehab unit. Shands Rehab has 16 private and 24 semi-private beds. Shands Rehab is located approximately 40 miles from the downtown Ocala area or the center point of the PSA. There are two primary physician groups that work within Shands Rehab: University of Florida Division of Physical Medicine and Rehabilitation, which includes Shands Rehab's medical director, Dr. James Atchison and Southeastern Integrated Medical (SIMED). While it may vary from week to week, SIMED covers approximately 60 percent of the inpatient population at Shands Rehab, whereas Dr. Atchison's group has the remaining 40 percent. The two physician groups have agreed to accept only two unfunded (charity) patients each "at any particular time," although for key diagnostic groups that are seen regularly, such as brain and spinal cord injury and stroke patients, the physicians will consider serving them if Shands Rehab is the best facility for the patient. Dr. Atchison further explained that if Shands Rehab did not have an opening for an unfunded patient on a particular day, the referring facility would be told to consider waiting a few days to refer a patient as an alternative pathway with the decision to refer or not left with the referring facility. No such restriction exists for other patients including Medicaid patients. (From approximately April 2006 through November 2008, it appears that a few patients were not admitted to Shands Rehab because the allotted charity beds (not other beds) were full, including approximately three patients at Munroe Regional and one patient from West Marion Community Hospital.) Between 2004 and 2007, Shands Rehab operated with an average daily census (ADC) of between 26 and 31, and runs at functional capacity at an ADC of 39 for its 40 beds. T. 1653, 1688; HS Ex. 66 at 25, 41, and 53. But see SL Ex. 212 for years 2004 through 2007 - ADC range of 25 to 28 and an average of 12 to 15 available beds. For 2008, the ADC was 29 and up to 31 in 2009. HS Ex. 69 at 144. Shands Rehab has a strong referral base from within the Shands Health Care System. Shands Rehab does not admit many patients from the Ocala area acute care hospitals and has not been successful in increasing referrals from the "northern tier" in and around Lake City, and "southern tier" in and around the Ocala area, notwithstanding a potential patient population to be served. But see Findings of Fact (FOF) 319-20. LRMC's Ohme Rehabilitation Center is a 15-bed unit (seven private and eight semi-private beds) located in the north campus of and approximately one mile from LRMC. Ohme is located approximately 50 miles from the downtown Ocala area. The CMR unit is located on the third floor of a building that also houses the 120-bed nursing home on the second floor. The gym for the CMR unit is located on the first floor of the same building. Between 2004 and 2007, the ADC at LRMC ran between 11 and 12 beds and the available number of beds ranged between three and four. In or around 2006, LRMC received an exemption from the Agency to add seven beds to its existing CMR facility. However, at the time of the final hearing the exemption granted to LRMC had expired. It appears that LRMC's senior executive team decided not to add the beds in light of a declining census and because of the significant expense to satisfy code requirements. LRMC considers the Spring Hill location as a distinct medical market. Since 2005, approximately 90 percent of Ohme's CMR patients were admitted from hospitals within the LRMC system or hospitals within the Lake County area. Since 2005, between 69 to 77 percent of the CMR patient admissions have come from LRMC. See also FOFs 328-339. A negligible number of patients have been referred to and admitted from Ocala area acute care hospitals, i.e., Munroe Regional, Nature Coast Regional Hospital, Ocala Regional Medical Center, and West Marion Community Hospital. The persuasive evidence indicates that LRMC does not do any meaningful marketing in the Ocala area for CMR patients. Sixteen CMR beds have also been approved for Seven Rivers Medical Center in Citrus County. The Seven Rivers unit was scheduled to become operational by June 2009. However, testimony indicated that the beds were still under development at the time of the hearing. For the year ending December 31, 2007, the occupancy rate for all CMR beds in District 3 was 82 percent. As noted, there are ten skilled nursing facilities in the PSA with 1,552 licensed beds. TimberRidge Nursing and Rehabilitation Center (TimberRidge), is a skilled nursing facility (SNF) and comprises 180 beds (174 semi-private and six private) and owned by Munroe Regional. TimberRidge provides nursing and rehabilitative care based on a patient's needs and is Medicare-certified. TimberRidge is located on the west side of Interstate 75 next to Munroe Regional's new freestanding emergency department. TimberRidge is not at functional capacity and had 50 available beds at the time of this hearing. Approximately 40-to-50 percent of TimberRidge's admissions come from Munroe Regional and approximately 25-to-30 percent from Ocala Regional and the same percentage from West Marion. (If Munroe Regional has 100 discharges, TimberRidge receives 20 percent of those which comprise 40-to-50 percent of TimberRidge's admissions.) TimberRidge and Oakhurst Rehab and Nursing Center are the Ocala area largest SNF recipients of discharges from Munroe Regional. TimberRidge has not had a physiatrist on staff for approximately seven years. The applicant argued that approval of the proposed facility would promote quality of care based on the assertion that patients in the PSA are not being admitted to a CMR facility but are instead admitted to a "lesser, and often inappropriate, level of care" such as long-term acute care hospitals or SNFs. However, this contention was not persuasively supported by the facts. The issue of whether patients are better served in one post-acute care setting versus another, and in particular, whether particular patients should be admitted to SNF or CMR facilities, including resulting outcomes, is a debated topic. In response to the debate, CMS has engaged the services of Research Triangle Institute (RTI) to conduct a study known as the CARE Project. The CARE Project was created to undertake research to develop a common tool or instrument that could be used to assess patients in multiple settings so that home health agencies, CMRs, and SNFs would be able to report comparative data. CMRs and SNFs provide different levels of care service. SNFs, even when providing rehabilitation services and therapies, do not provide the level of intense interdisciplinary rehabilitation services provided at CMR facilities. In general, a SNF, such as TimberRidge, offering rehabilitation services in a distinct portion of the SNF, provides appropriate rehab care for the patients it serves. TimberRidge, however, is not a pure substitute for a CMR facility. Richard Soehner, the Administrator for TimberRidge testified in opposition to HS-Ocala's representation that SNFs are often inappropriate levels of care for patients needing inpatient rehabilitation. TimberRidge's 180 beds are split into three 60-bed wings -- West, East, and South. The West Wing houses the most acute, intensive rehabilitation patients. Additionally, the rehabilitation population overflows into the East Wing. The remainder of the East Wing and South Wing house long-term residents. TimberRidge provides nursing and rehabilitation services to geriatric patients in and around Ocala. Employees of TimberRidge are involved in daily communications with discharge planners at hospitals, and help to determine whether TimberRidge can accept a resident. A registered nurse will often visit patients in hospitals and discharge planners to gather necessary information for admission to TimberRidge. TimberRidge employs or contracts with 30 to 35 therapists and has a medical director. Rehabilitation therapy disciplines include physical, occupational, and speech therapy. Therapists are available seven days a week and coordinate a patient's particular clinical needs with one another. Nursing care is provided 24-hours a day. After admission, each patient at TimberRidge undergoes a lengthy assessment process by therapy staff, nursing staff, social services, activities, dining services, and dietician. Then, a care plan is formed that outlines the goals and objectives and how these goals and objectives are going to be reached by the interdisciplinary care plan team. Physician orders and a therapist's judgment are used to determine how much therapy a patient can tolerate and what the patient needs. TimberRidge also receives input from families from the assessment standpoint. Families are encouraged to visit, attend and participate in care-planning meetings. Families are a key component of successful rehabilitation. Family members are also provided training by nurses or therapists. In like manner, families are an important component of the patient services offered at CMR facilities. Mr. Soehner reviewed HS-Ocala Exhibit 1, Bates Stamp 556, which contains the chart summarizing differences in care between area SNFs and Florida CMR hospitals. Although not a clinician, he testified the average charges for therapy of $62 per patient day indicated in the exhibit is diluted because the calculation includes patient or resident days related to patients not receiving rehab therapy. As a SNF administrator, Mr. Soehner knows of no correlation in the size of gym space or lack of gym space being detrimental to care provided. Therapy is still provided with successful outcomes. (On average, among CMR facilities in Florida, more space is devoted to gym space as a percent of the total square footage, than in Ocala area SNFs.) The chart on HS-Ocala Exhibit 1, Bates Stamp 556, states that the average pharmacy and lab charges are $16 and $2 a day, respectively, which would indicate that the patients are not receiving very much medication or lab work. However, this data tends to dilute the numbers for pharmacy and lab charges per patient day because the total patient days used includes long-term patients. Notwithstanding the testimony of Mr. Soehner, Ms. Greenberg's analysis of the different levels of service generally offered at SNFs and CMR facilities is at least consistent with the finding that CMR facilities offer more intense levels of rehabilitation services (for the categories shown) to its patients. Patients are admitted to a SNF. The first five days are considered to be an initial assessment period. TimberRidge provides different levels of rehabilitation based on a patient's needs. The Medicare program has established Resource Utilization Groups or RUGs. SNFs are reimbursed according to dollar allocations among the various RUG codes. But, RUGs are not outcome based. Each code represents a specific skilled level code or reimbursement code. The "R" codes are rehabilitation codes. There are several rehabilitation RUGs. There are five ultrahigh categories, i.e., RUX, RUL, RUC, RUB, and RUA. This means that each patient in this ultrahigh category must receive a minimum of 720 minutes (12 hours) of therapy over a five-day period (within a seven-day period) and includes more than one discipline. This also equates to 2.40 hours per day. (The rehab very high category requires 500 minutes of therapy per week.) In contrast, a person in a CMR facility must be able to tolerate three hours per day of therapy over a five-day period, whereas a patient receiving rehab in a SNF may have a minimum of approximately 2.40 hours per day if they are classified in the ultra high category. There are other levels of rehabilitation categories very high, high medium, and low, with RUG subcategories within each. For example, there are five RUG classifications within the very high category, e.g., RVC, RVB, RVA, RVX, and RVL. The RUGs categories are represented by a three-digit alpha code, with the first two digits representing the level of rehab, e.g., RU being rehab ultrahigh, and the last character, C, B, A, X, or L representing activities of daily living scores and the nursing care needs of the patient.3/ The RUG category for a patient can change throughout their stay. In other words, a patient may initially be assigned and placed in an ultra-high RUG category and later assigned a lower category. The RUG factors, like RUC (ultra high), are a measure of the intensity of therapy. It does not necessarily mean that the patient is any sicker than other patients, but it does mean that at least they have the stamina to tolerate more therapy. Medicare reimburses SNFs for rehabilitation services based on RUG scores and the amount of rehabilitation therapy a patient receives, whereas Medicare pays a CMR facility a total amount depending on a particular diagnosis of a patient. Like Ms. Gill, Mr. Soehner testified that reimbursement is determined by a comprehensive assessment, including the amount of rehabilitation projected or provided. Although it is not an outcome based reimbursement system, the RUG system is designed to reimburse a skilled nursing facility based on the resources a patient is expected to consume while admitted. TimberRidge's goal is to provide patients the services needed to attain and maintain the highest level of functioning the patient can sustain regardless of whether TimberRidge is reimbursed for it. In rare cases, this goal may allow for three hours of therapy a day, but for most cases, the patient cannot tolerate that intense level of care nor is it medically necessary. Ms. Gill examined data regarding rehabilitation patients admitted and discharged from TimberRidge by RUG classification based on age and length of stay during 2008.4/ Patients fitting within the rehab ultra high and very high, high, medium, and low were separated from the other rehab categories. The ultra-high category was chosen because any patient admitted to a SNF and deemed appropriate for any category lower than ultra high means that the patient cannot tolerate any more than 500 minutes (two and a half hours of therapy a day) of therapy a week, which would disqualify them from admission to a CMR facility. Thus, the ultra-high category was chosen as a proxy for CMR services, at least for therapy utilization. Approximate 35.8 percent of the ultra-high patients were over the age of 75 and 28.9 percent were 85 and older. Approximately 60 percent of the patient population is over 75 years of age, which is different from what one would normally see in a CMR facility. Of the 881 total rehab patients admitted and discharged from TimberRidge in 2008, 461 (or approximately 52 percent) were placed in the ultra-high category and 420 in the remaining rehab categories. (Based on a 2008 Medicare cost report, TimberRidge's ultra-high RUGs have grown from 26 percent to 50 percent, which, according to Ms. Greenberg, places TimberRidge on par with the state averages.) The ultra-high category has increased significantly since 2001. Of the 461 patients, 28.7 percent returned to home; 43.8 percent returned to home with home health; 18.7 percent returned to a hospital; and other small percentages were discharged to other settings. The percentages are slightly higher for those patients returning to home and some with home health when age is considered. Patients in the other rehab categories (very high, high, medium and low) had lower percentages of patients discharged to the home (20.1 percent) and home with home health (30.8 percent) and a higher percentage discharged to a hospital (27.2 percent). It is a fair inference that these patients may not have been able to tolerate significant therapy and were also sicker and with co-morbidities. The number of patients in the ultra-high and high RUG therapy categories is consistent with statewide averages and is normal. The same is true for the level of RUG therapy provided by SNFs in areas where HealthSouth has a CMR facility. The applicant views this information as an indication that SNFs are "filling a role, but they are not filling a gap." TimberRidge has won the local area's rehabilitation award and Reader's Choice award as the area's number one nursing home. The facility receives a lot of repeat business and referrals. There is a fair inference that TimberRidge is an appropriate placement for patients. TimberRidge is not at functional capacity; as of June 22, 2009, TimberRidge had 50 available beds. The evidence at the hearing demonstrated that the care provided through SNFs in the Ocala area is appropriate and produces quality outcomes. On the other hand, the rehabilitation services provided to SNF rehabilitation patients is not a pure substitute for the rehabilitation services, including therapies, provided at a CMR facility for patients requiring that particular service. Also, as noted herein, there are several material differences between CMRs and SNFs.5/ Thirty-to-50 percent of the patients at a SNF such as TimberRidge could be placed in a CMR or in a SNF. Overall, patients receiving rehabilitation services in the Ocala area appear to be receiving appropriate care, and the quality and intensity of care being provided by the existing SNF rehabilitation providers is equivalent to, if not better, than national averages and does not present a not normal circumstance. Alternative bed-need methodologies HS-Ocala's healthcare planner performed several bed- need analyses. The applicant assumed that 95 percent of the patients would come from within the proposed service area of 25 zip codes. The first methodology considered bed need by age mix. The bed-need methodology yielded a need for 45, 46, and 48 beds by 2010-2012 at 85 percent occupancy. The second bed need was based on a discharge use rate for freestanding CMR market areas versus the areas that did not have a freestanding CMR. This methodology yielded a bed need of 53, 55, and 57 for 2010-2012 with the same occupancy rate. A third bed-need approach was based on an analysis of CMS 13 diagnostic codes in relation to the population within the proposed 25 zip code service area. This analysis is also known as the conversion rate analysis. Based on this analysis, the applicant projected a bed need of 51, 52, and 54, for years 2010, 2011, and 2012, respectively. The applicant projected that 12 of the 54 beds or 22 percent of the bed need is potentially attributable to stroke patients and 42 to non-stroke patients. These projections are based on a 15 percent conversion rate. The "conversion rate" The argument that "not normal" circumstances exist in District 3 is based in large part on a comparison of "conversion rates" in various areas of the state with the proposed service area. The "conversion rate" is a ratio calculated by the applicant to determine the utilization of CMR services by Medicare fee-for-service patients in the primary service area of each of HealthSouth's facilities. HealthSouth has used this conversion rate as a means of evaluating the success of its facilities since approximately 2004. The calculation begins by determining the primary service area for each HealthSouth Florida facility. The applicant defines the primary service area of any particular facility as the zip codes from which that facility derives between 75 percent and 85 percent of its patients. The HealthCare Concepts Group of Dixon Hughes, a consulting firm retained by HealthSouth, determined the zip codes comprising the primary service area for each HealthSouth Florida facility using HealthSouth patient admission information (not Medicare or MedPar data) for calendar year 2007. Dixon Hughes determined the zip codes from which each facility derived approximately 80 percent of its patient admissions for each HealthSouth CMR facility. Although Dixon Hughes sought a goal of 80 percent, the percentage of patient admissions comprising the primary service area for the Florida facilities used in calculating the conversion rate varied somewhat, ranging from as low as 73.6 percent at HealthSouth Treasure Coast, to as high as 90.83 percent at HealthSouth Sea Pines. HS Ex. 53A, Bates Stamp 515-44. After establishing the zip codes comprising the primary service area of each facility, Dixon Hughes requested another consulting firm, Health InfoTechnic (HIT), to provide summary data for certain CMS-13 discharges and admissions for each primary service area for the nine HealthSouth CMR facilities. This CMS-13 data was collected from HIT in 2008 and available to HealthSouth in January of 2009. The summary tabulated data provided by HIT was generated from the MedPar database (approximately 13,300,000 records per year) for federal fiscal year 2006 (October 2005 through September 2006). (HIT received the MedPar data file around September 2007.) MedPar data only includes fee-for-service patients and does not include any Medicare HMO or Medicare Advantage patients. The MedPar database records and generates information contained in the medical history of patients covered by the Medicare fee-for-service program and discharged from acute care hospitals. The MedPar database records up to nine diagnosis codes for each patient. Using the MedPar database, HIT first determined the number of Medicare fee-for-service patients discharged from only acute care hospitals who resided in a HealthSouth facility's primary service area (by zip code provided by Dixon Hughes) and who had one of the CMS-13 diagnosis codes in their medical history. These were identified as CMS "qualifying patients." Once the qualifying patients were identified, HIT determined how many of those qualifying patients (within the primary service area for each HealthSouth CMR facility) were discharged to a CMR facility anywhere in the United States. HIT used the diagnosis procedure codes that are HIPPA protected fields to determine whether the patient is a CMS qualified patient. Other information, such as the patient's name, date of birth, and the codes are prohibited from release. HIT is prohibited by CMS and pursuant to a data use agreement from providing any of the underlying claims data to anyone including HealthSouth. The number of diagnosis codes examined to determine whether a patient qualified as a potential admission to a CMR facility under CMR rules varied depending on the particular impairment group being examined. For example, for brain injury and for burns, only two of the nine available diagnosis codes were examined. For stroke, only four of the nine available diagnosis codes were examined. For joint replacement and hip fractures, all nine available procedure codes were examined. No evidence was presented to determine the number of diagnosis codes examined for the other CMS-13 diagnoses, such as amputation, major multiple trauma, neurological disorders, spinal cord injury, congenital deformities, osteoarthritis, rheumatoid arthritis, and systemic vasculidities. A patient with a psychiatric or obstetrical condition who may have also had a qualifying CMS-13 diagnosis code in his or her medical history was automatically excluded from the total CMS-13 qualifying patients for purposes of determining the conversion rate. Patients who died in an acute care hospital were not excluded. Patients in rehab facilities were excluded. A summary of the analysis generated by HIT was provided to Dixon Hughes in order to calculate a conversion rate for each of the nine HealthSouth Florida facilities by dividing the number of qualifying patients discharged to a CMR facility by the total number of qualifying patients. For example, for HealthSouth Spring Hill, there were 1,206 total CMS-13 cases (by discharge and derived from MedPar data and HIT) that were discharged from acute care hospitals for patients residing within one of the zip codes within the facility's primary service area. Of the 1,206 patient discharges, 305 or approximately 23 percent were discharged to a CMR facility somewhere in the United States. See, e.g., HS Ex. 53A at 2. The 23 percent number is the conversion rate for that facility. (Again, in order to establish the zip codes for each HealthSouth CMR facility, all of the admissions (not just Medicare fee-for-service) were recorded from HealthSouth's internal admission data.)6/ The conversion rate for each of HealthSouth's nine Florida facilities, as determined in the manner described above, is contained in HS-Ocala Exhibit 53, Bates Stamp 484. The numbers on HS-Ocala Exhibit 53 are a subset of all the CMS 13 discharges because the data used is MedPar data. As stated by Mr. Edward Stall for Dixon Hughes, the conversion rate is not a market penetration rate. "It's really a measure of does a specific market utilize rehab care or does it not? It's more of an indicator of reasonable access to care" for the nine HealthSouth CMR facilities. Ms. Greenberg opined that the conversion rate was synonymous with a penetration rate, i.e., it is a determinant of what percentage of patients are likely users of a service. Ms. Bedard considers a conversion rate to mean the number of patients coming to rehab. She was not used to seeing data arrayed in the manner depicted on HS-Ocala Exhibit 53, Bates Stamp 484. The applicant originally calculated a conversion rate of 17.7 percent. However, the applicant was unable to produce any persuasive documentation supporting the calculation and, upon attempting to recreate the conversion rate, arrived at an average conversion rate of 17.9 percent. The Ocala Conversion Rate Once the PSA was defined, the applicant determined the Ocala Conversion Rate using the area from which the proposed facility would generate 95 percent of its patients. The Ocala Conversion Rate was generated using discharge information from the AHCA database for calendar year 2006, rather than MedPar data. Unlike the MedPar database, the AHCA database captures discharge information for all patients discharged from acute care hospitals, regardless of payor. Also unlike the MedPar database, the AHCA database records up to 31 diagnosis codes for each. The AHCA database is far less restrictive than the MedPar data base. The AHCA database was used to determine the Ocala conversion rate "because that's the universe of the patients that [the applicant] will serve." She did not use MedPar data because it contains only Medicare fee-for-service patients only. She used MedPar data to determine the conversion rate for the nine HealthSouth facilities because HealthSouth uses MedPar data as a benchmark to compare their market across the country and the data was available. Using the AHCA database, it was determined the number of patients residing in each of the 25 zip codes comprising the PSA who were discharged from an acute care hospital with a medical history including one or more CMS-13 diagnosis code In short, the applicant's analysis assumed that any discharge with a CMS-13 diagnosis code in the patient's medical history as described in the above paragraph would be a "qualifying patient" for purposes of calculating the Ocala Conversion Rate. This method yielded a total of 3,658 qualifying patients from the PSA for calendar year 2006. This method is also called a resident service rate. Of the 3,658 discharges, approximately 80 percent came from the four acute care hospitals in the service area; two percent from Leesburg; and 10 percent from Shands. The remaining discharges came from facilities outside the service area other than the facilities mentioned. Having identified the qualifying patients, the AHCA rehab data base was used to determine how many of the qualifying patients were discharged to a CMR facility. The determination of the number of patients discharged to a CMR facility included patients discharged to a CMR facility anywhere. This method yielded a total of 90 qualifying patients who were discharged to a CMR facility.7/ Dividing the number of qualifying patients discharged to CMR facilities (90) by the total number of qualifying patients (3,658) yielded the Ocala Conversion Rate of 2.46 percent. HS-Ocala contends that the Ocala Conversion Rate of 2.46 percent is unacceptably low compared to the 17-to-18 percent average conversion rate for HealthSouth's nine Florida facilities. According to the applicant, this comparison indicates "not normal" circumstances which are indicative of artificial geographic and programmatic barriers to accessibility to CMR services to residents of the proposed PSA. However, there are numerous problems with the conversion rate approach that make it inappropriate for use in determining need. The "conversion rate" is a self-defined concept unique to HealthSouth. It is not a use rate, nor a concept recognized in any rule governing the CON process, or recognized in the discipline of health planning, but it is used by HealthSouth. Rather, the conversion rate analysis is a marketing tool that is driven by and relies solely on HealthSouth's own experience. The HealthSouth Conversion Rate is driven by, among other things, HealthSouth's determination of what constitutes a primary service area for its own facilities. HealthSouth is the sole determinant of what constitutes a particular facility's primary service area. Because the calculation of the HealthSouth Conversion Rate begins with the determination of each HealthSouth facility's primary service area, the procedure cannot truly be replicated except in those areas where existing HealthSouth facilities are located. For example, there is no way to determine if Orange County has a conversion rate consistent with the HealthSouth Conversion Rate because HealthSouth does not have an established facility with a primary service area there. HealthSouth's determination of what constitutes the service area of the proposed Ocala facility also drives the determination of the Ocala Conversion Rate. Because there is no existing HealthSouth facility in the PSA, there is no historical HealthSouth patient admission data from which to determine a primary service area. Instead, HealthSouth "carved out" a 25 zip-code area within District 3 from which it claims the proposed Ocala facility will derive approximately 95 percent of its patient admissions. Even among the nine HealthSouth facilities in Florida, the areas HealthSouth has designated as the primary service area varies greatly. For example, while the primary service area for HealthSouth Treasure Coast constitutes the area from which the facility derives approximately 73.6 percent of its admissions, the primary service area for HealthSouth Sea Pines constitutes the area from which that facility derives approximately 90.83 percent of its admissions. Put another way, the primary service area of HealthSouth Sea Pines is over 23 percent larger in terms of admissions than the primary service area of HealthSouth Treasure Coast. The record is devoid of any explanation of whether this difference affects the HealthSouth Conversion Rate and, if so, how. Moreover, the variance in the conversion rate among HealthSouth's nine Florida facilities is also substantial, ranging from a low of 10.8 percent at HealthSouth Treasure Coast to a high of 25.29 percent at HealthSouth Spring Hill. There is no persuasive evidence in the record to explain why the conversion rate for HealthSouth Spring Hill is almost two and a half times that of HealthSouth Treasure Coast. According to the applicant, based on 93 HealthSouth markets around the United States, HealthSouth's conversion rate is approximately 16 percent. As noted above, the PSA constitutes the area from which the proposed facility will derive approximately 95 percent of its admissions. This service area is almost 30 percent larger in terms of patient admissions than that for HealthSouth Treasure Coast and is over 18 percent larger than the stated goal of 80 percent used to determine the HealthSouth Conversion Rate. The result of the larger patient origin percentage for the PSA is that it tends to overstate the potential demand for CMR services. The conversion rate is also driven by the manner in which HealthSouth chose to analyze the patient data to calculate the rate. HealthSouth used MedPar data, which only captures Medicare fee-for-service patients, for the calculation of the HealthSouth Conversion Rate. HealthSouth further limited the potential pool of patients by only using a portion of the data available in the MedPar database. For example, HealthSouth's consultant reviewed only primary and secondary diagnosis codes for certain CMS-13 categories, four diagnosis codes for others, and potentially all nine diagnosis codes in the MedPar database for other CMS-13 diagnosis categories. However, when the PSA conversion rate was determined, the potential patient pool was not limited in a similar manner. Rather, there was testimony that the use of the AHCA database, which includes patients from all payors, increased the pool of CMS-13 qualifying patients used for the calculation of the Ocala conversion rate. Since the MedPar data is a subset of the AHCA data, the number 3,658 would have been approximately 70 percent of 3,658 if MedPar data was used. Stated otherwise, the 3,658 number contains approximately 30 percent more people than would have been included if MedPar data was used. The MedPar database captures far less diagnosis codes than the AHCA database. This difference serves to further inflate the pool of CMS-13 qualifying patients in the PSA. Although the applicant could have evaluated the patient population for the PSA in the same manner that HealthSouth did to arrive at the HealthSouth Conversion Rate, the applicant chose not to do so. The MedPar and AHCA databases are not comparable. Mr. Balsano, in an attempt to compare apples-to-apples, calculated a conversion rate for HealthSouth's nine Florida facilities using AHCA data limited to Medicare fee-for-service patients only. Utilizing the same zip codes that HealthSouth used to calculate the HealthSouth Conversion Rate, Mr. Balsano calculated a conversion rate of 13.2 percent for the nine HealthSouth facilities, compared to the 17.9 percent determined using the MedPar database. Thus, the AHCA database, even when limited to Medicare fee-for-service like MedPar, yields a lower conversion rate. Mr. Denney, with HIT, testified that there are several reasons not to use the AHCA database for such an analysis. For example, the discharge status codes used by AHCA are not the same as universal billing codes and are not always in what are called UB04, or universal bill 04, codes as used by MedPar. Another problem with using the AHCA database is that Florida law allows distinct rehabilitation units of acute care hospitals not to report admissions to AHCA. The inconsistencies described herein do not allow for a valid comparison of the HealthSouth and Ocala Conversion Rates. The HealthSouth Spring Hill Case Study The application also contains a historical analysis of the conversion rate for the HealthSouth Spring Hill facility to support the argument that there is a need for the proposed facility. HS Ex. 1, Bates Stamp 550. Ms. Greenberg testified at length regarding the method by which she personally conducted the HealthSouth Spring Hill Case Study, including the method she used to determine the Spring Hill conversion rate utilized in the case study. Ms. Greenberg performed the Spring Hill Case Study using the AHCA database for calendar year 2006, but limited to only Medicare fee-for-service patients, arriving at the conversion rate for Spring Hill of 25.6 percent for calendar year (CY) 2006 (4.3 percent in CY 2002 prior to operation). This means that 25.6 percent of the CMS 13 discharges were residents within Spring Hill's primary service area (as defined by the applicant) who went to a CMR facility somewhere. (In HS-Ocala Ex. 53, Bates Stamp 484, the conversion rate is 25.3 percent.) Ms. Greenberg testified that the similarity in the numbers generated using the AHCA database limited only to Medicare fee-for-service and those generated using the MedPar database supports her conclusion that the MedPar and AHCA databases are comparable data sources. It was ultimately acknowledged that, in fact, like the HealthSouth Conversion Rate, the Spring Hill Case Study presented on pages 41-43 of the CON Application was derived from a summary of MedPar data for fiscal years 2002 and 2006 (October 1, 2005-September 30, 2006) that HealthSouth provided to Ms. Greenberg. The actual MedPar database was not reviewed. Rather, the analysis for the Spring Hill Case Study consisted of calculating the percentages based on the summary MedPar data provided by HealthSouth. Because the HealthSouth Spring Hill Conversion Rate was calculated in the same fashion as was the HealthSouth Conversion Rate, it does not reasonably serve as a comparison to the Ocala Conversion Rate for the same reasons. A conversion rate for the HealthSouth Spring Hill facility was calculated using the AHCA database prior to completing the application. However, that calculation was not included in the application. The summary data sheet, HS-Ocala Ex. 53, was sent to counsel for Shands and LRMC in a letter dated April 24, 2009. The information was then conveyed with the HealthSouth Conversion Rate to the applicant's health care planner. The underlying work papers were not saved. The applicant had to examine the 2006 Medpar data base and rerun the numbers. HS Ex. 53. The applicant produced a document indicating the reworked HealthSouth Conversion Rate along with the April 24, 2009, letter (written to counsel for Shands). HS Ex. 53, Bates Stamp 484. The document appearing as HS-Ocala Ex. 53, Bates Stamp 484 is a recreation of the numbers given to Ms. Greenberg. The underlying data upon which the applicant based the HealthSouth Conversion Rate, including the zip codes comprising the primary service area for the HealthSouth facilities, was available and in HealthSouth's possession (its computers) throughout the discovery phase of this proceeding. While some summary documents were provided, the underlying data which apparently would support the evidence was not. Instead, Mr. Stall and Mr. Denney described the process that was used to calculate the HealthSouth Conversion Rate. However, the testimony only served to further highlight some of the inconsistencies between the methodologies used to calculate the HealthSouth and Ocala conversion rates and to further support the conclusion that the rates are not necessarily comparable. Without the underlying data, it was difficult to confirm the comparison between the Spring Hill Conversion Rate and the Ocala Conversion Rate. Geographic and Programmatic Access The applicant alleges that there are geographic and clinical (programmatic) access problems that compromise the level of care and clinical outcomes of patients who would benefit from CMR services. Family travel distance can impact a patient's decision to access CMR services. The family access issue described by the applicant in this proceeding is not unique to District 3 or Marion County. Transportation of patients from acute care to CMR facilities is accomplished by emergency vehicles and, in some instances other forms of transport, including family automobiles. Potential patients within the applicant's PSA would not have typical or not normal problems accessing existing CMR providers in District 3. Shands provides free transportation to families who visit patients at its facility, and to those who need to be involved in the discharge planning process. Shands also provides other accommodations either free or at reduced costs. HealthSouth has a corporate policy of not providing transportation for Medicare patients to bring their family members to one of its CMR facilities for visits. The same policy applies for all patients. For HealthSouth, it is a compliance issue and considered an improper inducement. T. 544. Whether free transportation is improper is not resolved based on the record in this proceeding. But see HS Ex. 76. Interstate 75 is the main road through the Ocala area and runs north to Gainesville and south to Leesburg. Interstate 75 is a four-lane road and even six lanes in some instances. There are segments of road configurations which are composed of two-lane black tops with little or no lighting. Roadway segments north and south of the PSA are often rural with soft shoulders. There is evidence that some of these roads north and south out of the PSA are congested depending on the time of day and other conditions. The forest east of Marion County represents a natural geographic barrier. Florida Administrative Code Rule 59C-1.039(6) addresses the access standards for patients in need of CMR services. CMR "inpatient services should be available within a maximum ground travel time of 2 hours under average travel conditions for at least 90 percent of the district's total population." The applicant, and Shands and LRMC jointly, engaged traffic experts to conduct travel time studies to measure the length of time it takes for residents of the area to reach area hospitals. The applicant's travel expert, Lorin Brissett of Kimley-Horn and Associates, Inc., conducted a travel time study from Shands Rehab Hospital and LRMC to various locations or points within the PSA. Locations 1 through 4 were based on zip code information provided by the applicant in terms of the general coverage of the PSA, and denote the centroid of different population densities in the four quadrants of the PSA.8/ Location 5 represented the approximate center of the City of Ocala and the PSA. Mr. Brissett used a floating car method in performing the travel time study between locations one through four and location five. This method involves the driver attempting to pass as many cars as passed him, that is, the car would float with the traffic. Two runs were performed for each of the routes, going from locations one through four to location five. Two runs were performed for each return route. The runs were performed during peak travel times (typically between 4:00 p.m. and 6:00 p.m.) on a typical weekday, that is, Tuesday, Wednesday, or Thursday. The weather was clear and no accidents were noted. The travel study indicated that the average travel time to and from Shands was 52 minutes, with a high of 67 minutes and a low of 33 minutes. The average travel time from and to LRMC was 63 minutes, with a high of 90 minutes and a low of 37 minutes. The overall average travel time was 46 minutes from the center of the PSA to either Shands or LRMC. Mr. Brissett also commented that these travel times may be a bit longer for elderly drivers and that elderly drivers tend to travel more on local roads. Also, older drivers are not likely to drive using the floating car method. (None of the drivers used in the study were 65 years of age or older.) The travel study also noted that many of the roadway segments were rural in nature and there were conditions where the road was not properly lit. Mr. Brissett was not asked to conduct any study that would indicate what percentage of the District 3 population would be within two hours' average travel time to any existing CMR facility in District 3. Mr. Brissett was not asked to conduct travel studies for any CMR facility in District 3 other than Shands and LRMC and he did not do so. Mr. Brissett stated that rural roadways are not unique to Marion and Levy Counties, but exist in other Florida counties as well. Mr. Brissett concluded that anyone within the five zones would be able to access Shands Rehab Hospital in less than 70 minutes, even driving from 4:00 p.m. to 6:00 p.m., although it may take the elderly a bit longer. The travel expert retained by Shands and LRMC, William Tipton, Jr., based travel time runs on the location of the existing CMR facilities and population data for 2008 and 2013 published by AHCA for District 3. According to Mr. Tipton, "[l]ooking at the district and knowing the road systems available and the orientation of the populations to the existing facilities, it was evident that the adjacent counties to existing facilities could certainly make their runs within the access rule standard of less than two hours" or "substantially less time than two hours by each of the existing facilities within District III." Mr. Tipton's team conducted two runs in the morning peak hour, 7 a.m. to 9 a.m.; two runs in the midday off-peak hour, 11 a.m to 1 p.m.; and two runs in the evening peak hour, 4 p.m. to 6 p.m. to arrive at a complete cross section of the different travel patterns throughout the day.9/ Additionally, one of the test drivers in Mr. Tipton's team, was 70 years old and accomplished runs on 441 from Ocala to Shands, and on U.S. Highway 441 from Ocala down to Leesburg Regional Medical Center, and also the Interstate 75 runs. The elderly test driver's results were consistent with other runs accomplished by non- elderly drivers. Mr. Tipton's team also used the floating car method, but adjusted the methodology so that none of the drivers exceeded the posted speed limit by more than five miles per hour. In Mr. Tipton's opinion, this adjustment would give results that are more typical of what an average driver would do and more accurately reflects the driving patterns of elderly drivers. Mr. Tipton's results show that all of the facilities could be reached by at least 90 percent of the population in one hour or less; half the time required by rule. The roads traveled for Mr. Tipton's analysis were typical roadways found throughout central Florida. Mr. Tipton's study concluded that existing CMR facilities could be accessed within the requirements in Florida Administrative Code Rule 59C-1.039(6) and that a geographic access issue for an elderly person or someone else did not exist. Although the applicant argued that conditions existed that led to patients and family members not accessing CMR services, no testimony at hearing from area residents supported the contention. No residents of the PSA testified as to their personal experiences accessing existing CMR hospitals in the District. Rather, several of the applicant's expert witnesses testified as to their experience with local road conditions driving from the PSA to and from Shands Rehab and LRMC. Dr. Lohan opined that elderly persons may find it more difficult to drive at night versus the daytime, which is consistent with the evidence in this record. Further, the transportation of patients to CMR facilities is not problematic because they are usually transported by ambulance or similar method of transport. It does not appear that patient safety or quality of care has been compromised because of the alleged travel times and distances to existing CMR hospitals. On the other hand, the construction of the proposed facility would reduce the average travel time to an existing CMR hospital for persons residing within the PSA. However, the number of persons whose travel time will likely be enhanced was not persuasively quantified by the applicant, aside from projecting occupancy rates for the first two years of operation. It is expected that patients with multiple trauma, brain, and spinal cord injuries would most likely be referred to Shands Rehab. For the most part, patients with brain and spinal cord injuries are receiving rehabilitation and typically are referred to Shands Rehab. The applicant does not propose a spinal cord and brain injury unit like the service offered at HealthSouth's Spring Hill facility. Consequently, whatever travel challenges might exist for these patients and their families would still exist even after HealthSouth is approved. The testimony was consistent that, in part due to the nature of CMR services as tertiary, patients and their families at times experience problems accessing such services. These problems, or challenges, include not only the time and distance required to reach such facilities, but other factors, such as whether a patient should be admitted to a CMR facility rather than to other post-acute care settings and whether the patient's insurance policy provides coverage for such services. The testimony was also consistent that these challenges occur not only throughout Florida but, in fact, occur throughout the nation on a daily basis. These challenges do not represent "not normal" circumstances but are normal. Quality of Care No evidence was presented indicating any deficiencies in the quality of care provided by Shands or LRMC. The services or equipment to be provided at the proposed facility are not necessarily superior to the services that are provided at Shands or LRMC. The applicant will offer the use of an AutoAmbulator to its patients. The AutoAmbulator was developed for and is exclusively available at HealthSouth facilities. No independent study indicates that the use of the AutoAmbulator results in better outcomes for patients, compared to similar equipment used at existing District 3 CMR facilities. Economic Access Notwithstanding the applicant's proposed commitment to provide at least 2.5 percent of its annual inpatient days to Medicaid and charity patients, there is no persuasive evidence that there are financial barriers to access CMR services by the residents of the PSA. It was not proven that the resident population of the PSA, including the medically indigent, Medicare recipients, and the elderly, has been or is likely to be denied access based on economic factors. See Fla. Admin. Code R. 59C-1.030(2). Section 408.035(1)(c): The ability of the applicant to provide quality of care and the applicant's record of providing quality of care. The applicant's quality of care will benefit from the hospital's affiliation with its parent, HealthSouth, which offers high quality CMR services country-wide. HealthSouth has invested in state-of-the-art quality measurement systems to monitor processes and outcomes, allowing each facility to maintain high standards of quality of care. The applicant has demonstrated that it has the ability to adequately staff the facility and will provide high quality of care. Section 408.035(1)(d): The availability of resources, including health personnel, management personnel, and funds for capital and operating expenditures, for project accomplishment and operation. HealthSouth is a publicly traded corporation and is the largest provider in inpatient rehabilitative health services in the United States in terms of revenue, number of hospitals, and patient treated. HealthSouth has the financial resources needed to ensure project accomplishment and operation of the proposed project. HealthSouth is committed to assisting the applicant with fiscal and legal services, specialized accounting functions, and reimbursement expertise and information system services. There continues to be a shortage of healthcare personnel in Florida and it is inevitable that a portion of the staff for the proposed facility may come from other facilities in District 3. Nevertheless, the applicant is able to draw upon the managerial resources and broad range of established and services provided by HealthSouth, including the recruitment and retention of staff. The applicant has the available resources, including health and management personnel for the completion and operation of the project. Schedule 6 of the application describes the applicant's estimate of the projected staff and staff needed for the project HealthSouth will need 17 new RNs in Year Two based on its staffing projections. HealthSouth recruits personnel to staff its facilities locally as well as on a national and international level. HealthSouth also satisfies its staffing demands internally, as its employees have the ability to transfer from one HealthSouth facility to another. HealthSouth has been successful in recruiting therapists and nurses to staff its facilities. HealthSouth uses a variety of tools to recruit its nurses, and once hired, HealthSouth invests significant efforts in training its employees. From time-to-time, HealthSouth has paid for contract nurses to fulfill its staffing demands. HealthSouth is not expected to limit its recruiting efforts to the Ocala area, but will recruit from other areas as is necessary to appropriately staff the facility. There was a difference of opinion offered by the parties' experts as to whether the applicant's staffing projections in its application were reasonable. Testimony from the applicant's experts indicated that the staffing projections included in the application were reasonable and appropriate based upon the projected occupancy and utilization numbers for the proposed facility. Shands' and LRMC's experts testified that the applicant's projected therapist staffing needs in the application were inadequate to fulfill the projected utilization by patients at the proposed facility. It was also estimated that the FTEs projected in the application for therapy staff was short by anywhere from four- to-five FTEs. Despite the challenges presented by medical personnel shortages and the shortfall in the staffing needs projected in the CON application, it is reasonable to conclude that the applicant will be able to recruit the staff needed for the proposed facility. Staffing of the proposed facility may impair to some degree the ability of Shands and LRMC to staff their facilities, but not to the extent that the services and the quality of care provided will be reduced. Weighing all the testimony presented on this issue, the evidence supports the conclusion that the applicant's staffing projections are reasonable. The proposed average annual salaries in Schedule 6A are reasonable. Appropriate funds have been budgeted for management personnel. Section 408.035(1)(e): The extent to which the proposed services will enhance access to health care for residents of the service district. The applicant's proposed CMR facility will enhance access to health care for the residents of that portion of District 3 within the PSA, except for patients with brain injury or spinal cord injury who are expected to go to Shands. Notwithstanding historical referral and admission patterns, at the very least, Shands and LRMC are viable alternatives for the residents needing CMR services residing within the applicant's PSA. Section 408.035(1)(f): The immediate and long-term financial feasibility of the proposal. Immediate Financial Feasibility Immediate or short-term financial feasibility refers to the ability of an applicant to fund construction, start-up, and operation of the proposed project. By rule, the Agency incorporated by reference Schedule 3 among other portions of the CON application. Fla. Admin. Code R. 59C-1.008(1)(f). The applicant's witnesses testified it was feasible for the project to be financed internally or by a third party in which case the third party would finance the acquisition of the property and the construction of the building and the applicant would lease the property from the third party. In support of its ability to obtain financing for the project, the applicant submitted a letter from GE Healthcare Financial Services (GE) with its application. The letter from GE did not represent a binding or enforceable commitment to provide the financing described in the letter. Notwithstanding the testimony regarding the GE letter, the ability of the applicant to obtain funding through a third party or to internally finance the building and startup costs of the project was established. Neither Shands' nor LRMC's witnesses disagreed with the applicant's ability to obtain sufficient funds for capital and initial operating expenses. The project is financially feasible in the short- term. Long-term Financial Feasibility Long-term financial feasibility is generally referred to as the ability of a project to show a profit at the end of its second year of operation. The projected utilization of a proposed facility is a critical factor to assess when determining whether the facility will be financially feasible in the long-term, given that projected revenues and expenses are driven by utilization projections. Schedules 7 and 8 set forth the financial projections for the project for years one and two. The applicant projects a net profit for Year Two from operations of $483,512 (net operating revenue minus total operating expenses) and an overall net profit of $299,777. These dollar amounts are derived based on projected utilization of the project in Year Two minus projected expenses. Shands and LRMC contend that HealthSouth overstated projected revenues and understated projected expenses. The projected revenues appear to be overstated, whereas the projected expenses appear to be reasonable. The projected utilization was determined by applying the "conversion rate" equal to 15 percent of the discharges identified. The conversion rate was then applied, which is based only on Medicare fee-for-service patients, to both Medicare and non-Medicare patients. Application of the use rate to the projected population in the proposed service area yielded 9,828 patient days and approximately 677 admissions in the second year of the facility's operation. The patient days projected in turn yielded an occupancy rate of 67.3 percent in year two. HS-Ocala Ex. 1, Bates Stamp 639-640. The 3,658 patients identified by Ms. Greenberg as potential patients requiring CMR services generated 90 admissions to a CMR facility in 2006. It is not reasonable to assume that the population defined in the PSA area will generate almost six times the number of admissions to CMR facilities that are presently generated. The applicant also assumed that 95 percent of the patients would come from the PSA area and five percent from other areas (in-migration). Mr. Balsano noted the financial projections are based upon the assumption that CMR admissions of patients residing in the PSA would increase from 90 patients in 2006 to approximately 644 patients by Year Two of the proposed project. Mr. Balsano testified that such a significant increase is not a reasonable assumption and overstates the market. As a result, Mr. Balsano's opinion was that revenues included in the applicant's financial projections were significantly overstated and that he had serious concerns about the proposed project's financial feasibility. The applicant did not provide financial projections assuming it would build and own the proposed facility itself without the involvement of a third party. According to Mr. House, this was because the costs were greater to HealthSouth if it were to utilize third party financing, so basing the financial projections on such a scenario presented a more conservative picture of the financial projections. Mr. House testified that the financial projections included in the application were reasonable. The rent expense included in the financial projections in Schedule 8 of the application included a cushion of approximately $371,000. Applying the cushion results in an increase in year two profit from $483,512 to $854,512. It appears that funding is available on the same terms as proposed in the GE letter and that that the rent projections are reasonable. Schedule 8 of the application did not include a management fee charged by HealthSouth to its subsidiaries despite the fact that the application's narrative assumptions represented that a management fee of five percent was included. Ms. Greenberg prepared the assumptions and she inadvertently indicated that a management fee was included. The actual management fee charged by HealthSouth at the time of the hearing was approximately three percent (2.78 percent in 2008). If the management fee referenced in the application is factored into the equation at the rate of five percent, it adds $515,548 in expenses to the project. If the management fee is factored at the rate of three percent, it adds $309,328 in expenses to the project expenses. Ms. Greenberg stated that the rent expense included in the financial projections did not include an adjustment for sales tax. At 6.5 percent, this would add approximately $95,000 to the expenses. Assuming this additional expense for Year Two, the effect would be to reduce the net profit from operations from $854,512 to $759,512, which would not affect the long-term financial feasibility of the project. Mr. Balsano also opined that the real estate taxes included in the financial projections were understated by approximately $158,000. In response, Ms. Greenberg opined that if a shortage existed, it would be between $113,341 and $153,244, with an average of $133,293. When coupled with the omitted sales tax (-$95,000), and after adjusting for the inflated rent expense (+$371,000), this reduces Schedule 8, Line 27 from $854,512 ($483,512 plus $371,000) to approximately $450,184 (-$309,328/management fee of three percent and -$95,000/sales tax on rent at 6.5 percent). The profitability in year two would be reduced further if the real estate taxes are considered, i.e., $316,891(Greenberg projection) versus $292,184 (Balsano projection). Further, according to Mr. Balsano, the staff projections included in the application are understated by $469,391 assuming a shortage of 6.2 FTEs, or approximately $300,000 assuming a shortage of four FTEs. The applicant did not concede a shortfall existed. Also, as noted herein, the staffing projections are reasonable and there is no projected shortage. In balancing the net effect of the adjustments suggested by Shands and LRMC and the applicant's responses, it is concluded that the project will be profitable in Year Two if the applicant achieves the projected net operating revenue on Schedule 8A, Line 1. (It was conceded that if the management fee charged by HealthSouth to its subsidiaries was 2.7 percent as opposed to five percent as stated in the application's assumptions, a $20,000 profit in year two would be projected.) While reasonable persons could differ as to whether the expenses in the financial projections included in Schedule 8A are reasonable, the long-term financial feasibility of the proposed project is based upon revenues which are calculated using the projected utilization from Schedule 5 of the application. The projected utilization is driven by the conversion rate calculated by the applicant that materially overstates the potential market for these services in the proposed PSA. Because the applicant's revenue projections are not reasonable, the proposed facility is not likely to be financially feasible in the long-term. Section 408.035(1)(g): The extent to which the proposal will foster competition that promotes quality and cost- effectiveness. Mr. Gregg testified that there is no evidence within the Agency's ability to analyze whether the application will foster competition that promotes quality and cost-effectiveness. However, as Mr. Gregg testified, the ability of healthcare providers to promote competition is very limited because payors have very narrow policies about what they will pay. The overwhelming portion of patients who require CMR services are served by the Medicare program. There is no price competition involved in the provision of the services proposed in this application. 306 There is no persuasive evidence showing that competition for the services proposed is lacking, that the quality of the care provided to residents of the District is other than excellent, or that the services or equipment proposed are superior to those already available to patients in the District. While approval of the project will likely provide some residents of the PSA a closer alternative to CMR services and perhaps some savings in terms of travel expenses and time, no persuasive evidence proved that the project is likely to foster competition that promotes quality and cost-effectiveness. Section 408.035(1)(h): The costs and methods of the proposed construction, including the costs and methods of energy provision and the availability of alternative, less costly, or more effective methods of construction. The projected costs of construction in Schedule 1 are reasonable. The architectural plans are a reasonable. The architectural design and space for the proposed 40-bed freestanding rehabilitation facility are reasonable. The projected duration for construction of the facility is reasonable. The dates for construction are no longer accurate and would need to be extended due to the timing of the hearing. The projected land cost for the hospital is reasonable. The equipment listed in HS-Ocala Exhibit 6 is reasonable for the proposed facility. The equipment list does not include certain equipment, such as the AutoAmbulator, Bioness, and SaeboFlex, identified on pages 56-57 of the application. The cost of the AutoAmbulator was not included in equipment costs (although it is included on HS-Ocala Exhibit 6 at 8 of 16) because it is part of HealthSouth's research and development budget. The projected costs of the equipment are reasonable. Section 408.035(1)(i): The applicant's past and proposed provision of health care services to Medicaid patients and the medically indigent. HealthSouth has a history of providing health care services to Medicaid patients and the medically indigent, notwithstanding compliance issues relating to several of HealthSouth's Florida CMR facilities. Overall and based on the experience of HealthSouth, the applicant meets this criterion. Section 408.035(1)(j): The applicant's designation as a Gold Seal Program nursing facility pursuant to s. 400.235, when the applicant is requesting additional nursing home beds at that facility. This criterion is not applicable. Adverse Impact Shands and LRMC contend that approval of the proposed project would have a substantial negative impact on their operations. The issue of adverse impact is resolved in favor of Shands and LRMC, although it is a closer call than suggested by these parties, given the historical referral and admission of patients from within the PSA to Shands and LRMC. Consideration of adverse impact on existing providers is relevant to prove standing in a formal hearing involving a CON application pursuant to Section 120.57, Florida Statutes, and is a relevant factor to consider under Section 408.035(2), Florida Statutes, which includes consideration of the impact of approving a new hospital on an existing hospital in the same service district. Baptist Med. Ctr. of Clay, Inc. v. Agency for Health Care Admin. and Orange Park Med. Ctr., Inc. d/b/a Orange Park Med. Ctr., Case Nos. 06-0555CON, 06-0563CON, and 06-0843CON (DOAH Dec. 3, 2007, at ¶ 316; AHCA May 30, 2008), per curiam aff'd, 12 So. 3d 756 (Fla. 1st DCA 2009). Impact on Shands Mr. Balsano and Ms. Greenberg looked at the admissions to Shands from the defined PSA to determine the projected impact of the proposed facility on Shands. For the 12-month period ending June 30, 2007, Shands admitted 119 CMR patients from the zip codes comprising the PSA. To assess impact, Mr. Balsano and Ms. Greenberg agreed that patients with spinal cord or brain injury should not be considered, because those patients will likely continue to be treated at Shands. This left a total of 77 admissions. Mr. Balsano multiplied Shands' average contribution margin per patient, which he calculated to be $6,673, by the 77 patients to conclude that Shands would lose $513,821 in contribution margin. Mr. Balsano also considered the admissions to Shands from the secondary service area for the proposed facility that was referenced in the pre-application materials developed by Dixon Hughes. In 2007, Shands admitted 24 cases from this extended service area after subtracting the brain and spinal cord injury cases. Mr. Balsano concluded that Shands would lose half of those admissions. Applying the contribution margin to those cases resulted in an additional $80,076 of lost contribution for a total of $593,897. Ms. Greenberg disagreed with Mr. Balsano's use of the patients from the extended service area in his analysis of the potential impact on Shands. Ms. Greenberg opined that the use of these patients was inappropriate given the service area defined in the CON application, and the fact that HealthSouth considers the PSA a distinct medical market. Ms. Greenberg testified that major multiple trauma patients would also continue to be treated at Shands and, therefore, should be removed from the pool of at-risk patients. By doing so, Ms. Greenberg determined there were approximately 54 at-risk patients. Ms. Greenberg further reduced this number to account for patients who were admitted to Shands Rehab from within the Shands system because, according to Ms. Greenberg, those patients are likely to continue to be treated at Shands rehab. Applying this methodology to the 54 at-risk patients, Ms. Greenberg determined that the maximum number of at-risk patients was 19.3 and that the minimum number of at-risk patients was 13.5. Ms. Greenberg then multiplied Shands' average contribution margin per patient, which she determined to be $5,98410/ by the minimum and maximum at-risk patients she calculated, to determine that the impact to Shands would range from $80,787 to $115,196 in lost contribution margin. Using the contribution margin determined by Mr. Balsano resulted in a range of impact from $90,086 to $128,789 in lost contribution margin. Assuming consideration of the criticisms, Mr. Balsano testified that his estimate of 77 cases lost from the PSA was reasonable. Mr. Balsano based his conclusion, in part, on the fact that HealthSouth is projecting in excess of 600 admissions from the PSA in the Year Two. According to Mr. Balsano, to meet those projections, it is reasonable to assume the 77 non- spinal/non-traumatic brain injury patients that Shands is currently serving from the PSA will be redirected to the proposed facility. Having considered all of the evidence on this issue, including the historical referrals and admissions of patients to Shands, see, e.g., FOF 87, and while there is a wide variation in projected losses, it is concluded that Shands would lose significant dollars in contribution margin if the proposed facility were constructed. Impact on LRMC Similar to the analysis conducted with respect to Shands, Mr. Balsano looked to the admissions to LRMC from the applicant's HealthSouth defined PSA to determine the projected impact of the proposed facility on LRMC. For the 12-month period ending June 30, 2007, LRMC admitted 13 patients from the zip codes comprising the applicant's PSA. Notwithstanding the financial impact noted herein, from 2006 through 2008, the financial performance (excess revenues over expenses) of LRMC's CMR facility has improved. Mr. Balsano then multiplied LRMC's average contribution margin per patient which he calculated to be $8,007, by these 13 at-risk patients from the applicant's defined PSA to determine that the impact to LRMC for these 13 patients if the proposed facility is built would be $104,091 in lost contribution margin. Mr. Balsano also considered the admissions to LRMC from the extended service area for the proposed facility that was referenced in the pre-application materials developed by Dixon Hughes. In 2007, LRMC admitted 205 cases from the extended service area. Mr. Balsano determined that it was reasonable to assume that LRMC would lose half of those cases. Applying the contribution margin to those cases would result in an additional $824,721 in lost contribution for a total combined impact of $928,812 in lost contribution margin to LRMC if the proposed facility is built. Ms. Greenberg disagreed with Mr. Balsano's use of the patients from the extended service area in his analysis of the potential impact on LRMC. Ms. Greenberg felt that the use of these patients was inappropriate, given the service area defined in the CON application, and the fact that the applicant considers the PSA a distinct medical market. See FOFs 91-92. Ms. Greenberg's impact analysis focused on the hospitals from which LRMC derives its patients. Based on LRMC's data, Ms. Greenberg determined that in 2007, approximately 89 percent of LRMC's patients came from Leesburg Regional, Villages, Waterman or South Lake hospitals. In 2008, approximately 90 percent of LRMC's patients came from those hospitals with 81 percent coming from the Leesburg facilities. Since there were no admissions to LRMC from the three acute care hospitals in Marion County in 2007 and 2008, Ms. Greenberg determined that the likely impact to Leesburg if the proposed facility is built would be zero. For purposes of determining an upper limit of the potential impact on LRMC, Ms. Greenberg assumed that LRMC would lose the 10 percent of patients not coming from Leesburg Regional, Villages, Waterman or South Lake. Multiplying the 10 percent by the 13 total cases admitted to LRMC from the PSA, Ms. Greenberg determined that a total of 1.3 patients were at risk. Multiplying these at-risk patients by the contribution margin used by Ms. Greenberg of $7,27011/ results in an impact to LRMC of $9,451 in lost contribution margin. Notwithstanding the minimal impact to LRMC calculated by Ms. Greenberg, there is considerable overlap, in terms of either like or contiguous zip codes, between the Leesburg area and the PSA. For example, in fiscal year 2008, LRMC admitted eight patients from zip code 34491, three patients from zip code 32195, two patients from zip code 34420, and three patients from zip code 32784, or 16 patients. These zip codes are included in the defined PSA. LRMC admitted 37 patients from zip code 32159, 39 patients from zip code 32162, and 21 patients from zip code 34788, which are all zip codes that are contiguous to the defined PSa. In all, for fiscal year 2008, LRMC admitted 113 patients from zip codes that are either within or contiguous to the PSA. See also T. 2119. Applying Ms. Greenberg's contribution margin for LRMC to those 113 cases results in a loss to LRMC of $821,510. These 113 patients represent approximately 41 percent of LRMC's admissions. According to the Agency, a loss of approximately one-third of LRMC's admissions would be considered a substantial disruption of the patient flow pattern. Additionally, it is reasonable to assume that the applicant may attract patients from zip codes contiguous to its service area. Further, it is expected that the applicant will aggressively market to areas including contiguous zip codes and not stop at a bright line between zip codes. Having considered all of the evidence on this issue, including but not limited to the number of patients admitted from Ocala area hospitals, see, e.g., FOFs 91-92, it is concluded that while there is a wide variation in projected losses, LRMC, like Shands, would potentially lose significant dollars if the proposed facility were constructed. Such a loss in contribution margin and therefore admissions would substantially affect the facility. The loss of the contribution margins, coupled with the potential impact on existing staff and programs, is substantial enough to recognize the standing of Shands and LRMC.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered denying CON Application No. 10009. DONE AND ENTERED this 24th day of November, 2009, in Tallahassee, Leon County, Florida. S CHARLES A. STAMPELOS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 24th day of November, 2009.
Findings Of Fact Pauline J. Brown Larach, Respondent, is licensed by the Board of Nursing as a Registered Nurse, license No. 60268-2 and was so licensed at all times here relevant. Respondent was employed by Hollywood Memorial Hospital during the period July-October, 1981, in the Intensive Care Unit (ICU). At the time of her employment Respondent represented that she was qualified to work in the ICU. Hollywood Memorial Hospital sends all nurses employed through an orientation program of approximately one week before assigning them to a particular duty. Respondent went through this orientation program before she was assigned to ICU. Respondent was assigned the shift under the direct supervision of Shirley Scott, who was assistant head nurse of the ICU and was supervisor on the shift to which Respondent was assigned. Respondent's work was unsatisfactory and she was counselled several times by Scott. Specifically, Respondent was counselled about the manner in which she maintained her nurse's notes, her inability to schedule her time and duties, her inability to concentrate on a particular problem, her refusal to seek assistance when needed, and a penchant for ignoring serious problems. The following incidents gave rise to the concern about the type of care provided by Respondent to patients in the ICU: On about October 21, 1981, a neurological patient assigned to Respondent was on the drug Nipride to keep the blood pressure low. The patient had suffered intracranial hemorrhaging. The Nepride, which is considered a dangerous drug unless its administration is carefully monitored, was administered to this patient in much less than the time it should have taken for the Nipride to be infused and the patient's blood pressure dropped very low. The ICU supervising nurse discovered the patient in a severely hypertensive state and Respondent had placed the patient in a position with the head below the feet. This attitude would be correct for most patients whose blood pressure is low but was contraindicated for a neuro-patient or a patient with the history of intracranial bleeding. Although the head nurse's intervention possibly avoided further intracranial bleeding, no entry of blood pressure drop or of the emergency was placed in the nurse's notes kept by Respondent. On or about August, 1981, Respondent was observed by her shift supervisor (Scott) hiding her nurse's notes under a patient's mattress so Ms. Scott could not read them. During a "code" situation Respondent offered the doctor a cookie while he was resuscitating the patient. Respondent's nurse's notes are virtually illegible and replete with trivia and inappropriate items while failing to include pertinent information. Specifically, these nurse's notes were also found deficient in that Respondent did not chart complete systems before going to another system, but instead jumped around from items in one system to items in another and included trivia while omitting essential information about the patient. On one occasion when a patient was transferred from the emergency room to the ICU as a patient to be tended to by Respondent, who had accepted the patient by phone from the emergency room, upon arrival the patient was in dire distress and Respondent left the room. Another nurse declared a "code" emergency on this patient, but Respondent did not return to the room until after the "code" situation was ended. During a "code" situation involving one of Respondent's patients, it was discovered that she had incorrectly computed the infusion rate for the drug Dopamine, which drug is intended to raise blood pressure. Respondent's evaluations (Exhibit 1), which were prepared three months after Respondent commenced work at Hollywood Memorial Hospital, evaluated Respondent as unsatisfactory and far below the minimal standards required for acceptable nursing practices. This report followed numerous conferences with Respondent during this three-month period when the areas in which she was unsatisfactory were pointed out to her. All of the witnesses who worked with and observed Respondent in the ICU concurred that Respondent's professional competency, as observed by them, was far below minimal acceptable standards and that they would be unwilling to have Respondent assigned under them in an ICU. All expert witnesses opined that in the manner in which Respondent maintained nurse's notes, organized her work, provided care to patients, and, specifically, to react properly in an emergency situation, Respondent's performance as a nurse was far below minimal acceptable standards. At the expiration of Respondent's three-month period during which her evaluation was unsatisfactory, a conference was held between Respondent and hospital staff. At this meeting the evaluations were presented to Respondent and she was given the alternatives of voluntary resignation, transfer to a less critical area of the hospital, or termination. Respondent opted for voluntary resignation.
The Issue Whether the application of Columbia Hospital Corporation of South Broward d/b/a Westside Regional Medical Center or that of Cleveland Clinic Florida Hospital d/b/a Cleveland Clinic Hospital should be approved to meet the fixed numeric need for one additional adult open heart surgery program in Broward County, Florida.
Findings Of Fact The Agency For Health Care Administration ("AHCA") is the state agency which administers the health care certificate of need ("CON") program in Florida. AHCA published a need for one additional adult open heart surgery program, for the July 1996 planning horizon, in District 10, Broward County, in the Florida Administrative Weekly, Volume 20, Number 5 (February 4, 1994). Existing Providers Broward County is the only county in District 10. Immediately to the north, District 9 encompasses Indian River, Okeechobee, St. Lucie, Martin, and Palm Beach Counties. South of Broward County, District 11 includes Dade and Monroe Counties. West of Broward County is District 8 which includes, among others, Collier County. Subsection 408.032(5), Florida Statutes. There are five existing OHS providers in Broward County, three in Palm Beach County, and eight in Dade County. In adjoining District 9, a new OHS program has been approved for Martin or St. Lucie County. In District 8, a new program has been approved for Collier County. Of 3,268 OHS in District 10 in the year ending September 30, 1995, approximately 915 OHS or 28 percent were performed at North Ridge, 750 or 22.7 percent at FMC, 18.8 percent or 622 at Memorial Hospital, 16 percent or 551 at Broward General, and 14.6 percent or 483 at Holy Cross. The largest OHS volume projections, assuming the highest and a constant use rate, are 3,434 in 1997, 3,485 in 1998, 3,536 in 1999, and 3,589 in 2000, or an increase of 286 OHS cases from the year ending June 30, 1995 to the year 2000. By AHCA rule, OHS backup services are required when angioplasties are performed. In Broward County, the ratio of angioplasties to OHS is approximately one-to-one. Given that ratio, up to 300 additional angioplasties will be performed in 2000. In addition, the ratio of OHS to cardiac catheterizations ("caths") is a few percentage points higher than four-to-one in South Florida, or a projected increase of 1200 to 1500 cardiac caths. On average, each OHS operating room has the physical capacity to accommodate an average of two OHS a day, or ten for 50 weeks of the year, or approximately 500 a year. In each cardiac cath laboratory, the capacity is 1500 procedures a year based on recommended national guidelines. North Ridge Medical Center (North Ridge) North Ridge is a 395-bed, Tenet-owned for-profit hospital, with the largest OHS volume and the lowest average lengths of stay for OHS in Broward County. North Ridge is the closest provider to Palm Beach County, which is in AHCA District 9 and is immediately north of Broward County. North Ridge attracts significant numbers of OHS patients from District 9, particularly from the areas of Boca Raton and Delray. In 1994, District 9 residents comprised over 50 percent of the OHS patients at North Ridge. Holy Cross Hospital (Holy Cross) Holy Cross Hospital is a 587-bed not-for-profit hospital with 9 Level II NICU (neonatal intensive care unit) beds, and 43 comprehensive medical rehabilitation (CMR) beds. Holy Cross is also located in northern Broward County. Holy Cross operates 2 cardiac cath labs. At Holy Cross, two operating rooms, and a third room for angioplasty backup and other emergencies (of a total 18 operating room suites), 10 of 32 YUCCA rooms, and 24 of 100 telemetry (monitored beds) are used to provide OHS services. In 1994, 412 OHS procedures were performed at Holy Cross, 36 percent on residents of District 9 (particularly from Martin and St. Lucie Counties). The volume from District 9 is reasonably expected to decrease with the initiation of a new OHS program in either Martin or St. Lucie County. Florida Medical Center FMC is a 450-bed hospital, located on 50 acres (30 of which are developed), surrounded by a retirement community in central, western Broward County. FMC is accredited by the JCAHO. FMC offers psychiatric and CMR services. FMC does not have obstetrics or pediatric services. FMC is owned by Ornda Health Corporation, a for-profit corporation, which also owns Golden Glades Hospital and Parkway Regional Medical Center in Dade County, both approximately three miles from the Broward County border, and Coral Gables Hospital in southern Dade County. FMC has 40 ICU beds (10 in a separate cardiovascular intensive care unit, or CVICU), an additional 70 telemetry beds, 3 cardiac cath labs, and 9 operating rooms (2 dedicated to OHS and a third used as a standby room for angioplasties) Approximately, 2200 cardiac caths, 800 angioplasties, and 700 OHS were performed at FMC in 1995. FMC's 3 cardiac cath labs operate weekdays from approximately 8:00 A.M. to 4:00 P.M. One lab usually operates later during the winter months ("the season") to accommodate scheduled procedures which have been delayed or "bumped" due to emergencies. The 10 CVICU beds at FMC were fully occupied on 20 days during the month of December 1995. In contrast to the in-migration experience by North Ridge and Holy Cross, 98 percent of FMC's cases come from Broward County, and 80 percent from its immediate service area. North Broward Hospital District (Broward General) The North Broward Hospital District ("NBHD") is a tax-supported not- for-profit special district created by the Florida Legislature, governed by a Board of Directors appointed by the Governor. NBHD has residency programs established with the University of Florida and Nova Southeastern College of Osteopathic Medicine. NBHD operates four acute care hospitals and covers an area which includes approximately two-thirds of the residents of Broward County. One NBHD hospital, North Broward Medical Center, was initially an applicant in this batch, subsequently voluntarily dismissing its petition for review of the preliminary denial of its application. Broward General, another NBHD hospital, is an existing OHS provider, and is located in central, eastern Broward County. With 744 licensed beds, Broward General is the largest hospital in the County, and a major tertiary care center, with all the tertiary services except pediatric cardiac surgery and organ transplantation. The 744 beds are divided into 593 for acute care, 36 in a Level II NICU, 27 in a Level III NICU, 68 for adult psychiatry, and 20 for skilled nursing. The NBHD also operates public health clinics in the district, from which referrals for inpatient care are made to Broward General or the other NBHD acute care hospitals. Broward General is a Level II adult and pediatric trauma center and a regional perinatal intensive care provider. With Congressional grant funding, Broward General also serves "Ryan White patients" (HIV positive). Broward General has 2 dedicated operating rooms for OHS, with a third backup room for angioplasties, 10 CVICU beds, (operating at 80 to 90 percent occupancy), and 50 PCU beds. Broward General has the capacity to accommodate 700 OHS in its current physical spaces. At Broward General, 551 OHS cases, 688 angioplasties, and 1500 caths were performed in 1995. Although the OHS program has been in existence since the 1970's, Broward General failed to reach 350 OHS cases until 1992. In 1994, District 9 residents constituted 23 percent of the OHS patients at Broward General. South Broward Hospital District (Memorial Regional) The South Broward Hospital District is a tax supported district which covers approximately one-third of the residents of Broward County and operates 3 hospitals, including Memorial Regional. Memorial Regional is a 646-bed tertiary center, with adult open heart surgery, and a Level II trauma center. Memorial is located in southern Broward County between Interstate 95 and the Florida Turnpike. It is a disproportionate share provider of Medicaid reimbursed services. Memorial Regional has 2 dedicated OHS operating rooms on the second floor of the hospital. An 8-bed heart surgery unit on the sixth floor of the hospital is used as a CVICU. Memorial has three adult intensive care units, a 22-bed step down unit for OHS patients, and a 48-bed telemetry unit. At Memorial Regional, approximately 575 OHS were performed in 1995. Approximately 87 percent of Memorial Regional's OHS patients are Broward County residents. The Applicants In response to the published need, AHCA received applications from the Cleveland Clinic Florida Hospital (CCFH) and Columbia Hospital Corporation of South Broward d/b/a Westside Regional Medical Center ("Westside"), Columbia Hospital Corporation of South Broward d/b/a Plantation General Hospital, L.P., and the North Broward Hospital District d/b/a North Broward Medical Center. Only CCFH and Westside remain applicants in this proceeding, following voluntary withdrawals by the other two hospitals. Cleveland Clinic Florida Hospital (CCFH) CCFH is a 153-bed licensed hospital at which Cleveland Clinic - Fort Lauderdale, Florida (CC-Florida) physicians admit and treat inpatients. In December 1994, CCFH `initiated outpatient cardiac cath, followed in May or June 1995 with inpatient cardiac cath. Other non-invasive cardiology services, available at CCFH, include steptokinase and other thrombolytic (clot dissolving) drug therapies, stress testing, and echocardiology. CCFH operates approximately 133 of the 153 licensed beds, including 24 in a telemetry unit, 12 in an intermediate unit (with hard wire heart monitoring) and 8 in an ICU. In 1995, the average occupancy of CCFH was just under 50 percent. CCFH is not a disproportionate share provider. The sole corporate member of CC-Florida and CCFH is the Cleveland Clinic Foundation in Ohio (CC-Ohio). CCFH pays management fees to CC-Ohio and to CC-Florida. In 1995, the management fees were $2.5 million to CC-Ohio foundation and $2.1 million to CC-Florida. CC-Ohio is a not-for-profit multi-specialty, integrated health care organization, which employs the personnel, including physicians, who operate an inpatient hospital and outpatient clinic in Cleveland, Ohio. CC-Ohio was established in 1921 by three doctors seeking to continue practicing in a cooperative and collegiate fashion, as they had done in a World War I mobile army surgical hospital. Approximately 600 salaried physicians and 600 residents are currently on the staff of the CC-Ohio, and the staff receives national and international referrals of patients. CC-Ohio provides outpatient and inpatient services on a unified medical campus. It is a major cardiac care and educational facility, with both open heart surgery ("OHS") and heart transplantation programs. CC- Ohio is affiliated with the Cleveland Clinic Education Foundation, and is accredited by the American Council of Graduate Medical Education. Cardiovascular services are provided in approximately 300 of a total of 1200 beds at CC-Ohio. In 1995, 3645 open heart surgeries ("OHS") were performed at the CC-Ohio, 2,000 more cases than the second largest cardiovascular center in the United States. In 1995, the closed staff of 8 cardiovascular surgeons each performed from 400-450 procedures, in 11 dedicated surgical suites. At CC-Ohio, 55 of a total of 125 ICU beds and 72 of a total of 224 telemetry beds are dedicated to the care of cardiac surgery patients. CC-Ohio doctors pioneered in performing cardiac caths in the 1950's, coronary bypass graft surgery in the 1960's, reducing the need for blood transfusions during OHS, and in the use of the mammary artery rather than the saphous vein for grafts. Recent innovations include valve repairs rather than replacements, a specialty of Dr. Delos M. Cosgrove, one of the cardiovascular surgeons on staff. Other advances at CC-Ohio include the use of smaller incisions resulting in less invasive OHS and transplants of muscles from the back to the heart. In partnership with an equipment manufacturer, CC-Ohio standardized modules containing the equipment needed for each different kind of OHS. CC-Florida is also a not-for-profit foundation, which employs salaried staff physicians to practice in a multi- specialty clinic which was established in 1987, by Dr. Carl Gill and 23 physicians from CC-Ohio. Now 100 board- certified physicians are on the CC-Florida staff. The clinic is located at 3000 West Cypress Creek Road. Two additional 50,000 square foot clinics are planned, one each for Southern Palm Beach and Collier Counties. CCFH, the acute care hospital, is approximately 10 miles from the CC- Florida clinic, on U.S. Highway AlA in a high rise condominium residential area, located on a 3 acre site on a strip of land between the intracoastal waterway and the Atlantic Ocean. The highway is heavily travelled and congested, making it extremely inconvenient for the vast majority of CCFH's south Florida patients. As a result of the location, patients were evacuated during Hurricanes Andrew and Erin, and transferred to Florida Medical Center without difficulty, at a cost of approximately $72,000 for the rental of ambulances (not including lost revenue) . A total of 42 patients were relocated, 3 to the ICU, 9 to telemetry (heart monitoring) beds, and 30 to medical/surgical beds by ground transportation. CCFH has no helicopter landing pad. The building owned by CCFH was built in 1972, operated as North Beach Hospital, and purchased by CCFH in 1990. The medical staff includes community physicians who are not employees of CC-Florida, but are "grandfathered" for having previously practiced at North Beach Hospital. As the "grandfathered" physicians admissions to CCFH have declined, CC-Florida physicians admissions of patients to CCFH have increased. CCFH filed a CON application to build an $80 million replacement facility, so that it could locate its clinic adjacent to the new hospital. The co-location of the facilities would allow CC-Florida to operate on a unified medical campus, consistent with the CC-Ohio model. In addition, CCFH would have the additional space needed to expand graduate medical education programs. The replacement facility was not listed as a planned CCFH expense because the facility would be constructed and owned by Tenet, the parent company of North Ridge, and operated by CCFH. The existing facility has no space for expansion. CCFH is the applicant for CON 7687 to operate an adult OHS program, following the protocols and with training by the staff from CC-Ohio. The OHS program and related services will be provided on the second floor of the existing hospital, which is the current location of a recently renovated surgical suite. If approved for an OHS program, CCFH staff will train for approximately two weeks at the CC-Ohio. To allow staff to have hands-on experience in patient care, CC-Ohio expects the staff to receive Ohio licenses. Follow-up training by CC-Ohio staff at CCFH will also be provided. CCFH will renovate second floor space for a 22-bed semiprivate telemetry unit and a 6-bed cardiovascular intensive care unit ("CVICU"). The CVICU beds will be arranged in a "L" shaped configuration, separated by walls into rooms of approximately 13 by 15 feet each, with glass walls and doors at the end facing the nurses' station to allow visual monitoring of the patients. Prior to the start of inpatient caths at CCFH, in June 1995, inpatient cath patients were transferred to Holy Cross or, more frequently, Broward General. At CCFH, caths are performed in a single cath lab, which is also located on the second floor. Dr. Carl Gill and Dr. David E. Lammermeir are the CC-Florida cardiovascular surgeons who currently provide OHS services at Broward General and would perform OHS at CCFH, if approved. Despite serving an older, more acutely ill population, the CC-Florida surgeons have achieved excellent results. If the CCFH CON is approved, they expect to move 90 percent of their OHS cases to the CCFH. The two Board-Certified CC-Florida cardiovascular surgeons began practicing OHS in Florida in 1989 with approximately 30 OHS, followed with about 80 in 1990, and 120 in 1991. They performed a total of 147 OHS in 1992, 215 in 1993, 200 in 1994, and 205 in 1995. Most of their referrals come from four cardiologists on the staff of the CC-Florida. CCFH commits to hold charges at the pro forma levels during the period projected in the pro formas, and to provide free OHS to 13 (year 1) and 14 (year 2) uninsured patients, not qualified for public assistance, until the year 2000. CCFH is not a disproportionate share provider. Cleveland Clinic Florida Hospital Plan "CCFHP" is a preferred provider organization with a total number of 3500 covered lives. Dr. Gill performed OHS on 20-25 members of the health plan in 1995. The budgeted CCFHP number for OHS is 100 in 1996. Currently, CCFHP may be experiencing "adverse selection", by attracting a disproportionate number of enrollees at risk for needing OHS. The rate of OHS for CCFHP enrollees is twice that expected in the general population, while the volume is below that projected. CCFH is located approximately 1 1/2 to 2 miles from Holy Cross, 3 to 4 miles from North Ridge, 6 to 7 miles from Broward General, 8 miles form FMC, and 11-12 miles from Memorial Regional. Columbia Hospital Corporation of South Broward d/b/a Westside Regional Medical Center ("Westside") Westside is a 204-bed medical/surgical community hospital located in Plantation, in western Broward County. Westside's services include obstetrics, pediatrics, oncology, orthopedics, outpatient surgery, and home health agencies. Westside is JCAHO accredited. Westside is owned by Columbia Hospital Corporation of South Broward, a subsidiary of Columbia/HCA Hospital Corporation ("Columbia"), a for-profit organization of 350 hospitals, 60 of those in Florida. Columbia owns six and operates five hospitals in Broward County. One Columbia-owned hospital, Pembroke Pines, is leased to the South Broward County Hospital District. The other four Columbia Hospitals in Broward County are Northwest Regional Hospital, University Medical Center, Pompano Beach Medical Center, and Plantation General Hospital. Columbia has filed an application to move Pompano Beach Hospital to western Broward County, near the site at which CCFH applied to build a replacement facility. Columbia has initiated the organization of the Broward Physician Alliance, a closed physician network hoping to attract 400 primary care doctors and specialists to establish an integrated health care delivery organization with the Columbia hospitals. Westside is the applicant for CON 7686 to establish an adult OHS program. Two ground floor operating rooms, located across the corridor from the cardiac cath lab, will be designated as the main and backup OHS suites. Two private and one semi- private room on the third floor will be converted to a 4- bed CVICU, with two beds on each end of the room, separated by privacy curtains. Each CVICU patient area is approximately 8 1/2 by 9 feet. One semiprivate and one private room on the third floor will also be converted to a 3-bed Progressive Care Unit ("PCU"). A storage room on the ground floor will be converted to a cardiac rehabilitation unit. Westside also has a 14-bed ICU on the second floor. Westside proposed three conditions for the issuance of CON 7686: (1) ensuring that at least two percent of its open-heart cases are Medicaid during the first two years of operations, (2) ensuring that a percentage of its open heart cases are for charity care patients (i.e., those meeting federal poverty guidelines) during the first three years of operation, and that an amount equal to $160,000 in the first year, $280,000 in the second year, and $353,000 in the third year is placed in a restricted fund at the beginning of each year for this purpose, and (3) not exceeding the net revenue per case projected in the first two years for managed care payors. In the first year of operation, the commitment equates to the provision of OHS services to 3 charity and 5 Medicaid patients, and in the second year, 5 charity and 7 Medicaid patients. Approximately 20 cardiologists, and 8 cardiovascular surgeons are on the staff at Westside, although Westside has not identified which surgeons will participate in its OHS program. Westside's existing cardiac services include electrophysiology, nuclear cardiology, electrocardiology, echocardiography, and stress testing. Inpatient and outpatient cardiac cath services were initiated at Westside in 1990. At Westside, 530 cardiac caths were performed in 1994, and 455 in 1995. In the CON application, Westside projected that it would perform 694 cardiac caths in 1995. The 1994 to 1995 decline is attributed to the opening, in the fall of 1994, of an inpatient cardiac cath lab at another Columbia facility, University Hospital, and to the preferences of managed care companies and physicians for having cardiac caths performed at hospitals with OHS backup services. Westside's cardiac cath lab is physically located on the ground floor of the hospital directly across the corridor from the surgery suites. Westside's objectives of initiating diagnostic electrocardiogram ("EKG") within 5 minutes of a chest pain patient's arrival and the start of thrombolytic drug therapy, if needed, within 30 minutes, have been exceeded 90 percent of the time. Westside is located approximately 3 to 4 miles from FMC, 7 miles from Broward General, 8 to 9 miles from Memorial Regional, 9 miles from North Ridge, and 9 to 10 miles from Holy Cross. CON Review Criteria Subsection 408.035(1)(a) - The need for the health care facilities and services and hospices being proposed in relation to the applicable district plan and state health plan. Local Health Plan Priority The District 10 health plan gives priority to an applicant proposing to initiate cardiac cath or cardiac surgery who documents a willingness to serve patients regardless of their ability to pay. Westside proposes to condition its CON on the provision of 2 percent Medicaid for the first two years of operation, and on placing $160,000 in year one, $280,000 in year two and $353,000 in year three in a restricted fund for charity care. The commitment is consistent with Westside's provision of 2.4 percent Medicaid patient days in 1993, which increased to 5.9 percent in 1995. CCFH commits to provide free OHS to 13 patients in year one, 14 in year two, and 16 in year three. CCFH also commits to providing 21, 24, and 27 free angioplasties in each of the three years, respectively. Of 804 cardiac care patients at CCFH, as determined by a January 1996 market share report, 2 were Medicaid and 32 were reported in a combined self pay/charity category, which generated revenue roughly equivalent to the commercial HMO category. CCFH's inpatient cardiac cath CON was also conditioned on the provision of 80 free caths a year, 36 inpatient and 44 outpatient. From June 1995, when inpatient caths began, until October 1995, CCFH performed 12 charity care caths, or a shortfall of 34 cases below its CON commitment. Of the two applicants, Westside better documents the reliability of its limited commitment to Medicaid and charity care. The only other District 10 local health plan priority, for applicants establishing cardiac cath labs at facilities with existing OHS capabilities, is inapplicable. State Health Plan Preferences The preferences in the 1993 applicable state health plan are applicable to this review. Preference one is given to applicants establishing new OHS programs in larger counties in which the percentage of persons over age 65 is higher than the statewide average and the total population exceeds 100,000. Both applicants propose to locate facilities in Broward County, which had a projected population close to 1.4 million in January 1996, with 20.2 percent of that population age 65 and over. This compares favorably, in terms of the preference, to the statewide average of 18.8 percent of the total state population over 65 years of age. Although Westside claimed, in its application, that the percentage of people over 65 residing in its service district was higher than the county average, that was shown to be incorrect. Preference two is given to applicants clearly demonstrating the ability to perform more than 350 adult OHS procedures within three years of initiating the program. In the CON application, CCFH projected achieving OHS volumes of 298 in 1996, 343 in 1997, and 382 in 1998. At hearing, CCFH's expert conceded that the OHS program was unlikely to meet those projections. CCFH extended the projections, using more recent experiences, to 335 in 1998, 372 in 1999, and 410 in 2000, which are now projected to be the first three years of the program. The projections are based on the expected growth in the volume of OHS performed by Dr. Gill and Dr. Lammermeir, increasing enrollees in the CCFHP, attracting Florida residents currently receiving OHS at CC-Ohio, attracting uninsured patients, attracting patients from the current Broward County in-migration, and reversing out-migration. Dr. Gill and Dr. Lammermeir performed 215 OHS in 1993, 200 in 1994, and 220 OHS in 1995, 75 of the latter were managed care and had to be performed at Broward General, leaving a patient base of 145. By contrast, the CON application projected a patient base of 172 in 1995. Assuming that CC-Florida's cardiovascular surgeons experience a three-to-one ratio of cardiac caths to OHS, although the County ratio is four-to-one, then its cardiac cath volumes are inadequate to support its projected OHS utilization. CCFH projected performing a total of 600 caths in 1995, as compared to the actual total of 484 caths. The projected number of cardiac caths is not sufficient to support the projected OHS volumes, and, rather than increasing, the volume of OHS performed by cardiovascular surgeons appears to have become static. CCFHP has not met projections in the original CON application, having started in 1995 with 23 enrollees who received OHS, rather than beginning in 1994 with 19 and achieving a volume of 37 OHS on enrollees in year two. The financial viability of CCFHP is also reasonably questioned, because of its having failed to break-even in the first three years of operations. Some CC-Ohio OHS patients from Florida are reasonably expected to have altered patterns of out-migration to Ohio, choosing instead a CC-Florida cardiovascular surgeon. Approximately 50 Florida residents a year have OHS in Cleveland, and CCFH assumed that half those will opt to stay at a program offered at CCFH. CCFH failed to support that assumption having provided no information on the CC-Ohio Florida patients' districts of origin, or the extent to which CC-Florida cardiovascular surgeons have not already captured some of the out-migration. CCFH's projection also is based on services to uninsured patients. That projection is not supported by the limited information available to compare its cardiac cath CON projections to its performance, or the proportions of uninsured in its total cardiac care patients. CCFH is reasonably expected to have difficulty attracting uninsured patients given the availability of services provided by the NBHD and the SBHD at seven tax-supported hospitals in the County. See, Finding of Fact 43. CCFH expects to capture some Broward County in-migration, particularly from Districts 8 and 9. In fact, CCFH contracts with a transportation service for patients in the Naples area, in District 8. New OHS programs in both Districts 8 and 9 are reasonably expected to decrease their residents demand for services in District 10. CCFH physicians already attract more than 13 percent of OHS patients from beyond Districts 8, 9, 10 and 11, with only 50 to 55 percent of OHS performed on Broward County residents. Due to the excellence of its surgeons and its reputation as an affiliate of CC-Ohio, it is reasonable to conclude that CC-Florida has already captured a significant segment of the in- migration and reversed some Broward County out-migration, except that based on managed care contracts and patient proximity to Dade County. CCFH reported that 15 percent of 1994 discharges came from other Florida Counties, other states, and foreign counties, which reflects its operation as a referral facility. In general, CCFH failed to demonstrate that moving its OHS program from Broward General to CCFH will increase its share of in-migration or further reduce out- migration of patients, or otherwise be able to achieve the 350 minimum within three years. In a CON application filed six months prior to the one at issue in this proceeding, Westside projected performing 175OHS cases in year one, and 250 in year two. In this CON application, Westside projected OHS case volumes of 204 in 1996, 305 in 1997, and 357 in 1998. At hearing, Westside's projections were 204 in 1997, 306 in 1998, and 361 in 1999, assuming a use rate of 2.30 procedures for every 1000 adults, with 18 percent market share in the 13 zip codes in Westside's service area and with 22 additional OHS cases from outside the area. Westside's ratio of 2.3 per 1000 is the provider use rate for Broward County, which includes in-migration from other districts. However, in-migration provides additional cases for OHS providers which border neighboring districts, but is not evenly distributed among all Broward providers. In the northern part of the county, Holy Cross and North Ridge draw more patients from adjoining District 9. In the south, Dade draws approximately 300 cases from contiguous areas, nearly half of those from border zip codes in the Hollywood area. The closest provider to Westside, FMC experiences little in-migration. Therefore, the adult resident use rate (which excludes in- migration) without out- migration, or 1.9 per 1000, is more reliable in projecting the volume of OHS cases at Westside. At FMC, which shares overlapping cardiologists and an overlapping service area with Westside, the ratio of cardiac caths to OHS is four-to-one. Although Westside has what AHCA's expert described as a mature inpatient cardiac cath program, 240 cardiac caths were performed in 1993, 530 in 1994, and 455 in 1994. Westside had projected performing 564 total caths (inpatient and outpatient) in 1994, and 694 in 1995. The 1994 to 1995 decline was attributed to the opening of an inpatient cath lab at another Columbia facility, University Hospital, and to the preference of managed care companies and some physicians for cardiac cath labs which have OHS backup services. In Dade County, Columbia operates two OHS programs which are below the 350 threshold. The most reasonable projections are that Westside will achieve approximately 164 to 175 cases in year one, 247 to 250 in year 2, and up to 284 in year 3. Neither CCFH nor Westside supported their projections to clearly demonstrate compliance with preference two of the state health plan. State health plan preference three is given to applicants who will improve access to open heart surgery for persons who are currently seeking the service outside the district, to improve accessibility and reduce travel time. CCFH does not meet the preference because much of that reversal of out-migration already occurs in the CC-Florida physicians' practices at Broward General. Westside is also unlikely to have an impact on out-migration due to its location in a service area in central Broward County. Preference four is given to an applicant with a history of providing a disproportionate share of charity care and Medicaid patient days, and who provide services to persons regardless of their ability to pay. CCFH and Westside are not disproportionate share charity or Medicaid providers and do not meet the preference. Preference five is given to an applicant that can offer a service at the least expense with high quality of care standards. The preference specifically notes that the physical plant of larger facilities is more likely to meet the preference, by accommodating the required operating and recovery rooms at lower capital expenditures than smaller facilities. Westside and CCFH are small community hospitals, which currently offer no tertiary services. Westside is obviously a larger hospital than CCFH, comparing 153 to 204 beds, and proposes lower capital expenditures. Westside also has more patient days, approximately 60 percent higher average daily census, with more Medicare, more MDC-5 (cardiac care) patients, and a more active emergency room. Although the correlation of these factors to OHS cases is questionable, considering the fact that the largest number of OHS in the county were performed, in 1994 to 1995, at the OHS provider with lowest average daily census, North Ridge. In general, however, the larger hospital can have a lower cost per adjusted admission adjusted for case mix, which favors Westside. CCFH is approximately $200 per admission more expensive than any of the existing OHS providers and approximately $750 more than West side. Westside contends that the real cost of the CCFH OHS project is approximately $5 million, not $2.9 million (as shown on Schedule 1), and should include the surgical renovation project which is underway at CCFH. CCFH notes in its application that CON Action Number 7472 was approved and "is currently in the process of being implemented. When construction is complete, CCFH will have adequate operating rooms, pump room space, and recovery room space to accommodate the open heart program." Westside's expert, however, was unable to distinguish the portions of the surgery project related specifically to OHS as opposed to general surgery. Westside's total project cost of $1.8 is reasonable. If Westside achieves the volume of 350 OHS, its physical facilities will be inadequate for the cardiac cath and angioplasties expected based on FMC's ratios of four-to-one for OHS to cardiac caths and one-to-one for OHS to angioplasties. National guidelines suggest 1500 procedures for each cardiac cath laboratory. The plans submitted with a CON application are block drawings designed to show the size, scope, and cost of the project. Although Westside notes that the plans submitted were more detailed than required, the general location of various functions is established. Westside's expert architect conceded that the proposal to have surgery suites on the ground floor and CVICU on the third floor is not the most desirable arrangement, even if connected by a dedicated elevator. The claim that Westside's elevator would be dedicated was not supported by the explanation of any alternative route for other surgery patients. Those patients have to be moved from the ground floor surgery area to the 14-bed ICU located on the second floor, directly below the proposed CVICU and PCU. The CVICU proposed by Westside also has inadequate space, inadequate windows, and exposed toilets within patient cubicles. If the CVICU and PCU are full, or to avoid having different genders in the PCU which has one bathroom, patients will be placed in monitored rooms on the third floor or in a 14-bed ICU on the second floor. Although proposed to serve as the overflow area, the ICU is full on average for four months each year. The additional monitored beds generally do not have comparable coverage by nursing staff dedicated to the care of OHS patients. In general, the physical plant and proposed locations of various components of the OHS program are sufficiently inadequate at Westside to adversely affect quality of care and to raise doubt that subsequent, more detailed construction plans can comply with AHCA licensure requirements. CCFH contends that its nursing units are organized to provide state- of-the-art care to patients in a compact, efficiently used spaces. However, in a subsequent CON application filed by CCFH in which it sough to replace and relocate its hospital facility at a cost in excess of $80 million, CCFH claimed "monumental barriers in using its present facility" that was "designed for delivery of health care in a different era," which is "crowded" and one of the most inefficient providers in Broward County. CCFH is unable to conduct research, education, training, and residency programs at its facility. The replacement application notes the inefficiency which results from physicians traveling back and forth between the hospital and the clinic, which also undermines the ability to replicate the CC-Ohio model. Neither Westside nor CCFH is entitled to be favored under preference five. Preference six, for applicants, performing streptokinase, P.T.C.A., and other innovative alternatives to surgery is met by the applicants to the extent allowed by Florida law. Both propose to perform those additional procedures which require open heart surgery backup, if their OHS programs are established. Subsection 408.035(1)(b) - The availability, quality of care, efficiency, appropriateness, accessibility, extent of utilization, and adequacy of like and existing health care services and hospices in the service district of the applicant. All residents of Broward County currently have access to OHS services. There is no geographic access problem in the district. In fact, Broward County OHS programs serve more non- residents than Broward residents served outside the district, although that net in-migration is expected to decrease due to the approval of new OHS programs in either Martin or St. Lucie Counties, and in Collier County. Existing OHS programs are geographically well dispersed throughout the county, with Holy Cross and North Ridge in the north, FMC and Broward General in the center, west and east, respectively, and Memorial Regional in the south (between 1-95 and the Florida Turnpike). AHCA has classified OHS as a tertiary health service which, because of the complexity and cost of service, should be limited to and concentrated in a limited number of hospitals to assure quality, availability, and cost-effectiveness. Every Broward County resident is within 2 hours average travel time of an OHS provider, which exceeds the geographic accessibility standard set by AHCA rule. There is evidence that financial access is also not a problem in Broward County, due to the unique coverage of the county by the two tax- supported health care districts. There is no evidence of programmatic access enhancements from the applicants proposals. None of the procedures performed at Westside or by Dr. Gill and Dr. Lammermeir will differ from those performed by other cardiovascular surgeons in Broward County. There was evidence of past inefficiencies at Broward General Hospital. Subsequently, in 1995 and continuing into 1996, the NBHD has substantially reduced the number of administrators, frozen salaries for senior management, aggressively negotiated supply contracts with major vendors, and reduced inventory. Subsection 408.035(1)(c) - The ability of the applicant to provide quality of care and the applicant's record of providing quality of care. Both applicants have a record of providing an excellent quality of care and are JCAHO accredited. Westside can use its affiliation with Miami Heart Institute and other Columbia OHS providers, as CCFH can with CC-Ohio to assist in establishing their OHS programs. Their ability to provide a high quality of care in an OHS program is, nevertheless, adversely affected by physical plant constraints and the inability to demonstrate compliance with the preference for achieving 350 OHS cases within three years. Florida Administrative Code Rule 59C-1.033, expresses AHCA's intent not normally to approve an applicant which does not meet the applicable statutory criteria and the criteria in the rule. The rule includes additional criteria which, in part, assure quality of care, as well as accessibility, including the range of OHS and related supporting services, hours of operation, and staffing levels. CCFH has two cardiovascular surgeons and Westside has the ability, with the help of Columbia, to recruit cardiovascular surgeons who will perform the range of surgeries required by the rule. Both offer inpatient cardiac cath, and other supporting services and departments, as required by the rule. The rule also requires OHS programs to operate 8 hours a day, 5 days a week, and to be capable of rapid mobilization within a maximum period of 2 hours, 24 hours a day, 7 days a week. CCFH's plan to have its OHS program "closed" to surgeons other than Dr. Gill and Dr. Lammermeir, will assure that only well-qualified CC-Florida cardiovascular surgeons staff its program. CCFH failed to demonstrate that the hours of operation can be as required by the rule with these two surgeons, one of whom has regular commitments in Ohio. Due to personal and professional commitments, including management responsibilities at CC-Ohio, one of the cardiovascular surgeons testified that each one of them will be unavailable from 30 to 45 days a year. CCFH proposed that a surgeon from CC- Ohio might be used if the two CC-Florida surgeons are unavailable. The rule requires a minimum of two cardiovascular surgeons on staff. As a practical matter, the rule also requires both to be at the hospital to operate an OHS program and an angioplasty program efficiently, during the hours required in the rules. One board-certified or board-eligible cardiovascular surgeon is required for the OHS team, one is required to provide backup for angioplasties, and one of these must also be on call at all times. Subsection 408.035(1)(d) - The availability and adequacy of other health care facilities and services and hospices in the service district of the applicant, such as outpatient care and ambulatory or home care services, which may serve as alternatives for the health care facilities and services to be provided by the applicant. There is no evidence of alternatives to inpatient OHS services, therefore the criterion is inapplicable. Subsection 408.035(1)(e) - Probable economies and improvements in service that may be derived from operation of joint, cooperative, or share health care resources. Although the affiliation with large health care groups may allow both applicants to take advantage of economics of scale in training, consultative, and purchasing agreements, neither is proposing to operate a joint, cooperative, or shared health care program. Subsection 408.035(1)(f) - The need in the service district of the applicant for special equipment and services which are not reasonably and economically accessible in adjoining areas. CC-Florida's OHS patients experience average lengths of stay consistent with those experienced in Broward County, not the longer stays which characterize a facility doing more difficult procedures, like CC-Ohio. There are no services proposed at CCFH or Westside which are not provided or approved at OHS programs in Districts 8, 9 and 11. There are three OHS programs in Palm Beach County and another one approved for District 9. J.F. Kennedy Hospital in Atlantis, in Palm Beach County, District 9, and Miami Heart Institute in Dade County, District 11, are Columbia-owned OHS providers which are located within 2 hours drive time of Westside. Five of the eight Dade County OHS providers operate below the 350 threshold, and two of the five are Columbia facilities. Three Columbia hospitals in Dade County accounted for approximately 1000 OHS cases in 1995. Over half of these OHS were performed at Miami Heart Institute, leaving volumes in the low 200s at the other two programs, Cedars and Kendall. Subsection 408.035(1)(g) - The need for research and educational facilities, including, but not limited to, institutional training programs and community training programs for health care practitioners and for doctors of osteopathy and medicine at the student, internship, and residency training levels. Westside did not propose to meet any need for research or training programs, although it currently has established relationships with high schools, vocational schools, and community and four year colleges. CCFH offers internal medicine and colorectal surgery residency programs. In addition, CCFH provides graduate medical education programs for family practice residents. Approximately 50 residents rotated, for one or two months each, through CCFH or CC-Florida in 1994 and 1995. In the replacement CON application, CCFH acknowledges that it has 792 square feet per bed in contrast to both current community hospital averages of 1,000 to 1,200 square feet per bed, and teaching and research facility averages of 1,400 to 1,500 square feet per bed. In general, CCFH's expert in graduate medical education testified there are a sufficient number of cardiovascular surgeons and cardiovascular surgeon training programs in the United States. Florida, however, ranks forty- first of the fifty states in providing graduate medical educational opportunities. That ranking is unlikely to be altered by the approval of the CCFH OHS CON, because there is no space for additional students or residents at CCFH. Subsection 408.035(1)(h) - The availability of resources, including health manpower, management personnel, and funds for capital and operating expenditures, for project accomplishment and operation; the effects the project will have on clinical needs of health professional training programs in the service district; the extent to which the services will be accessible to schools for health professions in the service district for training purposes if such services are available in a limited number of facilities; the availability of alternative uses of such resources for the provision of other health services; and the extent to which the proposed services will be accessible to all residents of the service district. The need for clinical training programs for health professionals is considered under Subsection 408.035(1)(g). The extent to which the proposed services will be accessible to residents of the district is considered under the local and state health plans, under Subsection 408.035(1)(n), and Rule 59C- 1.033. Both CCFH and Westside have the funds necessary to establish the proposed OHS programs. The staffing proposed by CCFH is adequate to provide postoperative care to the projected volume of 343 OHS patients and 157 PTCA patients in the second year of operation for projected average lengths of stay of 10.9 and 2.7 days, respectively. Westside's proposed OHS staffing for nurses in the CVICU and PCU is inadequate. FMC's expert demonstrated that 12 (not the proposed 10.7) registered nurse full time equivalent positions are needed. Although there was testimony that Westside would use the existing staff of laboratory technicians and respiratory therapists to meet the needs of OHS patients, Westside failed to account for their time on the staffing tables in the application. One reasonable expert opinion is that Westside underestimated staff costs, salaries and benefits, by over $500,000. Subsection 408.035(1)(j) - The special needs and circumstances of health maintenance organizations. Based on AHCA's interpretation, an applicant favored under this subsection must be a health maintenance organization (HMO), which CCFH and Westside are not. Subsection 408.035(1)(k) - The needs and circumstances of those entities which provide a substantial portion of their services or resources, or both, to individuals not residing in the service district in which the entities are located or in adjacent service district. Such entities may include medical and other health professions, schools, multidisciplinary clinics, and specialty services such as open-heart surgery, radiation therapy, and renal transplantation. CCFH serves more patients from outside the district and adjoining districts than will Westside, is affiliated with a multidisciplinary clinic, and proposes to provide OHS services. CCFH, by functioning as a referral facility with 15 percent of its cases coming from beyond Broward County and adjacent districts, better meets the statutory criterion than Westside. Subsection 408.035(1)(1) - The probable impact of the proposed project on the costs of providing health services proposed by the applicant, upon consideration of factors including, but not limited to, the effects of competition on the supply of health services being proposed and the improvements or innovations in the financing and delivery of health services which foster competition and service to promote quality assurance and cost-effectiveness. CCFH's OHS program will reduce volumes of OHS cases at Broward General to 346, 348, and 350 in the first three years of CCFH's operations. On Broward General's open staff, between 10 and 15 cardiovascular surgeons are credentialed to perform OHS. Approximately 40 percent of all OHS at Broward General are performed by CC-Florida cardiovascular surgeons, with 90 percent of those under their direct control. Broward General receives a contribution margin to its fixed costs (derived by subtracting variable costs from total revenue) of $1,686,000 from the CC- Florida OHS cases it is projected to lose to CCFH. In addition to OHS, CC-Florida physicians provided other cardiac services at Broward General with an estimated total contribution margin (for OHS and other cardiac services) of $2.4 to $2.9 million. Any financial detriment to Broward General diminishes its ability to provide Medicaid and charity care, which it already provides at a disproportionately greater level than any other OHS provider in the District. The establishment of an OHS program at CCFH will also substantially adversely affect Broward General in terms of quality of care, by reducing volumes below the minimum set by the state. Westside projected that from 40 to 60 percent of its OHS cases will come from FMC, 16 percent from Broward General, and the remainder from the other OHS providers in Broward County. Westside also projected that 30 percent of its cases would come from a Humana HMO contract. At the time the projection was made Humana OHS cases were performed at Broward General, many of those by CC-Florida physicians. Subsequently, that contract was awarded to FMC, resulting, in part, in the decline in CC-Florida's patient base. With the added Humana cases, FMC reasonably expects to lose approximately 215 cases to Westside. FMC would remain over the 350 minimum, but would suffer a substantial adverse financial loss, in excess of $1.5 million, as a result of the approval of an OHS program at Westside. If an OHS program is approved at CCFH, FMC reasonably expects to lose approximately 60 OHS cases, or between $.s million to $1 million in adverse financial impact, but will retain volume substantially above the 350 minimum at approximately 650 cases. Holy Cross, regardless of the approval of OHS at Westside or CCFH, expects to lose from 125 to 150 OHS cases to a new District 9 provider. If CCFH's OHS application is approved, Holy Cross reasonably expects to lose another 60 to 80 cases each year during the first three years of the program. If Westside's CON is approved, then Holy Cross reasonably expects to lose 9, 15, and 17 cases, respectively, in each of the first three-years. The projected cumulative financial loss to Holy Cross is $2.8 million if CCFH is approved, and $.5 million if Westside is approved. Combining the cases lost to a new District 9 provider with Holy Cross' estimate that it will lose 58 cases in year one, 68 in year two, and 76 in year three to a program at CCFH, Holy Cross reasonably expects for its OHS volume to fall below 350 if the CCFH OHS program is approved. Memorial Regional reasonably expects to lose in the range of 35 to 55 cases in each of the first three years of an OHS program at Westside, and from 18 to 23 cases over the same period if an OHS program is approved at CCFH. Subsection 408.035(1)(m) - The costs and methods of the proposed construction, including the costs and methods of energy provision and the availability of alternative, less costly, or more effective methods of construction. There is no evidence of less costly or more effective methods of construction at CCFH or Westside which could alleviate physical plant inadequacies of their facilities or proposals, respectively. Section 408.035(1)(n) - The applicant's past and proposed provision of health care services to Medicaid patients and the medically indigent. In the year ending 1993, CCFH provided 2.6 percent Medicaid and 1.0 percent charity care and, in 1994, 2.5 percent Medicaid and 1.8 percent charity care. For the same periods of time, Westside provided 2.9 percent Medicaid and .32 percent charity, and 3.8 percent Medicaid and .4 percent charity care. CC- Florida cardiovascular surgeons performed OHS on two Medicaid patients in 1993 and one in 1995. Existing OHS providers range from lows (from 9/92 to 8/93) of .48 percent of Medicaid and .7 percent of charity at North Ridge, 4.32 and .21 at FMC, 6 percent and .79 percent at Holy Cross, to highs of 12 percent and 9 percent at Memorial Regional, and 22 percent and 7 percent at Broward General. The history of providing Medicaid and charity care at CCFH and Westside is below that of other private, non-tax supported facilities, except North Ridge. CCFH proposed to provide 13 free OHS in year one and 14 in year two, until the year 2000. By comparison, Westside proposed to provide the equivalent of care for 3 charity and 5 Medicaid patients in the first year, and 7 Medicaid and 5 charity cases in year two, and $353,000 in a restricted fund for charity care in the third year. CCFH's commitment is not reliable based on the actual performance of its cardiovascular surgeons, and the comparison of its projections and experiences in providing free inpatient cardiac caths. See, Finding of Fact 43. Westside's commitment is consistent with its experience and reliable, although lower than that of CCFH, and limited to two years for Medicaid and three years for charity care. Section 408.035(1)(o) - The applicant's past and proposed provision of services which promote a continuum of care in a multilevel health care system, which may include, but is not limited to, acute care, skilled nursing care, home health care, and assisted living facilities. Although one applicant operates a clinic and the other has two home health agencies, neither demonstrated that the OHS services will be offered in a manner which promotes a continuum of care in a multilevel health care system. Section 408.035(2) - In cases of capital expenditure proposals for the provision of new health services to inpatients, the department shall also reference each of the following in its findings of facts: (b) That existing inpatient facilities providing inpatient services similar to those proposed are being used in an appropriate and efficient manner. (d) That patients will experience serious problems in obtaining inpatient care of the type proposed, in the absence of the proposed new service. Subsection (a), related to alternatives to inpatient care is discussed below. Subsections (c), related to new construction, and (e), related to long- term care, are inapplicable. Subsection (b) is applicable and considered under subsection 408.035(1)(b), supra. CCFH's two cardiovascular surgeons experience no difficulty scheduling patients for OHS at Broward General. Similarly, Westside's cardiovascular surgeons are able to transfer patients to FMC, within an overlapping service area, for OHS, despite the fact that its ICU reaches capacity during the season. Approximately 90 percent of OHS are elective, scheduled procedures. There was no showing that OHS patients will experience any problems in obtaining OHS services in the absence of the establishment of an additional program. Subsection 408.035(1)(i) - The immediate and long-term financial feasibility of the proposal. Both CCFH and Westside demonstrated that their proposals are financially feasible in the immediate or short- term. Westside overstated the volume of OHS cases (based on the use rate) and understated staffing needs, both of which adversely affect the long-term financial feasibility of its project. CCFH also overestimated the volume of OHS cases by failing to clearly support the reasonableness of the various components of its projections. CCFH expects a contribution margin per OHS case in the range of $3,400 to $3,700. In order to cover fixed and variable costs, CCFH estimates that it must perform 251 of the projected increase of 286 new OHS cases in Broward County by the year 2000. CCFH is not reasonably expected to achieve projected volumes See, Findings of Fact 48-53. CCFH also underestimated the proportion of Medicare patients and overestimated the commercial insurance patients within its payor mix, as compared to total patients and to cardiac care (MDC-5) patients. Medicare reimburses at a fixed rate which is lower than most commercial insurance full coverage plans. Assuming only that Westside failed to include approximately $500,000 in salaries and benefits, then the profit projected in the second year, in excess of $200,000, would become a loss of over $200,000 from operations. Losses would continue in the third year at approximately $100,000 for that year. CCFH and Westside are also at risk for not reaching projected utilization because of their relatively small size and low volume of cardiac caths. Neither CCFH or Westside supported its utilization assumptions and, therefore, neither demonstrated that its proposal is financially feasible in the long-term. Subsection 408.035(2)(a) - That less costly, more efficient, or more appropriate alternatives to a new OHS program are not available or not practicable (or the need for an additional OHS provider). AHCA's expert was not aware of any facts to suggest that OHS providers in Broward County are unavailable, inefficient, inappropriate, inaccessible, overutilized or delivering unsatisfactory quality of care. Therefore, absent "not normal" circumstances which have not been shown, need must be demonstrated in relation to the statutory and rule criteria. The numeric need methodology indicates a numeric need for four additional OHS providers. Using the district's facility use rate for the 12 months ending September 30, 1993, or 2.8 procedures for every 1000 adults (the population age 15 and over) and the projected population for January 1996 of 1.15 million, AHCA calculated the expected OHS procedures for July 1996 to equal 3,198. Dividing that total by 350, the minimum number of procedures required at each facility, AHCA calculated a total numeric need for the district of 9.137 providers, which minus the 5 existing providers, results in a difference of 4.137. AHCA has a rule allowing the publication of the need of only one additional OHS program in a district at a time. Before AHCA publishes need, however, the rule also requires an arithmetic showing that all OHS programs can maintain, with a new provider, at least 350 procedures. That requirement was demonstrated by dividing 3,198 projected procedures by 350, which demonstrates that six district programs can average 533 OHS procedures. The highest projected increase in the volume of OHS is 286 additional cases by the year 2,000. Approximately 500 OHS cases can be performed in each of the 11 OHS operating rooms in the districts every year, meaning that, in terms of physical capacity, over 5,000 total, or nearly 2,000 additional OHS cases can be accommodated at the existing providers. Using 1,500 cardiac caths as full capacity, cardiac caths labs also have excess capacity. At the five OHS providers, cath lab utilization ranges between 61 to 81 percent of capacity. Non-OHS provider cath labs utilizations ranges from 9 to 37 percent of capacity. The existing providers also have the capacity to accommodate more patients in their critical care units, in which 1994-1995 occupancy ranged from lows of 62 percent at FMC and 69 percent at Holy Cross, to highs of 73 percent at Broward General and Memorial, and 86 percent at North Ridge. CONS are not required to add cardiac cath labs or to add operating rooms dedicated to OHS services. In effect, the applicants assert that existing providers may expand capacity to bar new competitors from the market, therefore, capacity should not be emphasized over other CON criteria. In this case, however, excess capacity demonstrates that patients will not go unserved if the applicants fail to qualify under the other statutory and rule criteria. In addition, national trends indicate OHS rates increasing more slowly than the rates of alternative new forms of angioplasties. On balance, considering criteria which distinguish between the two, Westside's application presented limited, but more credible Medicaid and charity care projections than CCFH. Westside is also a larger, more active facility, in which proposed renovations are less costly. Westside's proposal is inadequate in terms of physical design with space constraints which make it impossible to comply with licensure requirements or to provide quality care. With inadequate support for its utilization projections, Westside failed to demonstrate that its volume of OHS and staffing will assure quality of care or its long-term financial feasibility. Apart from the numeric calculation, no need for Westside's program was demonstrated in terms of CON statutory and rule criteria. A program at Westside would adversely affect revenues derived from OHS programs at FMC and Memorial Regional. On balance, CCFH's application demonstrated that CCFH would function more like a referral facility, serving more patients from beyond adjacent areas. But, as with Westside, no need was demonstrated in terms of other CON statutory and review criteria. While CCFH proposed to be an excellent teaching and research facility, no need for that type of facility was demonstrated, and CCFH could not meet that need given its admitted physical plant constraints. In addition, or because they are not needed, CCFH, like Westside, failed to support its utilization projections and the long-term financial feasibility of its proposed OHS program. The approval of a program at CCFH will substantially adversely affect the quality of care and revenues generated from existing OHS programs at Broward General and Holy Cross.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the applications of Columbia Hospital Corporation of South Broward d/b/a Westside Regional Medical Center for CON 7686, and Cleveland Clinic Florida Hospital for CON 7687 be denied. DONE AND ENTERED this 2nd day of December, 1996 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 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 2nd day of December, 1996.
The Issue Whether Petitioner should be denied certification as a certified nursing assistant for failure to disclose prior criminal history on her application, as alleged in the Notice of Intent to Deny.
Findings Of Fact Petitioner Stephaney Christie ("Christie") wants to become a certified nursing assistant ("CNA"). Because she is not currently certified in another state, to accomplish this goal, Christie must submit an application for certification by examination to Respondent Board of Nursing (the "Board"). The Board is responsible for reviewing such applications and determining whether applicants are eligible to take the nursing assistant competency examination, which consists of a written test and a skills-demonstration test. Successful completion of both portions is necessary to obtain a CNA license by examination. On October 31, 2014, Petitioner filed an application, again seeking to be certified as a CNA by examination. The application included a question which sought information about the applicant's criminal convictions, if any. It provided as follows: Have you EVER been convicted of, or entered a plea of guilty, nolo contendere, or no contest to, a crime in any jurisdiction other than a minor traffic offense? . . . *If you answered YES, please be prepared to create a typed or printed letter with arrest dates, city, state, charges and final dispositions and be prepared to send it to the Board Office upon request. (Do not send this information with your application for examination.) Christie's application erroneously indicated "No" in response to this question. In 1999, Christie was involved in a neighborhood altercation to which law enforcement was called. Christie pulled away when an officer attempted to touch her arm. She was found guilty of a misdemeanor charge of obstructing an officer without violence. She received and completed a sentence of community service. In 2000, Christie left her young child in the care of a neighbor. When Christie returned home, she found her child had a black eye. She became involved in a heated discussion with the caregiver and as the argument escalated, threw a glass at the caregiver, which cut the caregiver's face. As a result of this altercation, Christie was charged with aggravated battery with a deadly weapon causing great bodily harm to which she pled guilty, and adjudication was withheld. Christie successfully completed a three-year probationary sentence and paid restitution to cover the victim's medical costs. On January 27, 2015, Respondent notified Christie that her application was incomplete pending Respondent's receipt of information regarding judicial disposition of her arrests, sentence completion status for each offense, and a typewritten explanation addressing each offense. On February 23, 2015, Christie provided the requested information, including a lengthy explanation of the circumstances surrounding each of her criminal offenses. At that time, Christie also provided character letters, including one from Assisting Hands home health care entity attesting to Christie's diligence and compassion in performing her job-related duties with its clients. On June 30, 2015, Respondent issued the Notice of Intent to Deny ("Notice") Petitioner's application for certification as a CNA by examination. The Notice explained Christie's application was being denied due to her "attempting to obtain a nursing license by bribery, misrepresentation, or deceit," by having incorrectly answered "No" to an application question. At the hearing, Christie testified that the incorrect answer regarding previous misdemeanors and felonies was a mistake. She explained that her application was prepared by personnel running the CNA training program from which she had taken classes to prepare for the CNA certification examination. Training personnel filled out and submitted the computerized application form on Christie's behalf without verifying with Christie the accuracy of the information or showing the application to Christie. In fact, Christie did not see the application until she was provided a copy by Respondent when notified her application was incomplete. Christie credibly testified that she had no intention of hiding her past criminal record. She was aware that any background check required to obtain a professional license would reveal her prior charges and disposition. No evidence was presented by Respondent correlating the crimes committed by Christie more than 15 years ago to the practice or ability to practice the profession of a CNA. Determinations of Ultimate Fact Christie is not guilty of attempting to procure a CNA license by misrepresentation or deceit, which is a disciplinable offense and grounds for denial of licensure under section 464.204(1)(a), Florida Statutes. Christie was not previously found guilty of a crime related to the practice, or ability to practice, the profession of a CNA.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent, Department of Health, Board of Nursing, enter a final order granting Petitioner's application for certification as a CNA by examination. DONE AND ENTERED this 3rd day of May, 2016, in Tallahassee, Leon County, Florida. S MARY LI CREASY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 3rd day of May, 2016. COPIES FURNISHED: Stephaney Christie Apartment No. 301 4759 Via Palm Lakes West Palm Beach, Florida 33417 Deborah Bartholow Loucks, Esquire Office of the Attorney General The Capitol, Plaza Level 01 Tallahassee, Florida 32399-1050 (eServed) Joe Baker, Jr., Executive Director Board of Nursing Department of Health 4052 Bald Cypress Way, Bin C02 Tallahassee, Florida 32399-3252 (eServed) Jody Bryant Newman, EdD, EdS, Board Chair Board of Nursing Department of Health 4052 Bald Cypress Way, Bin C02 Tallahassee, Florida 32399 Nichole C. Geary, General Counsel Department of Health 4052 Bald Cypress Way, Bin A02 Tallahassee, Florida 32399-1701 (eServed)
Findings Of Fact RTCPB is an existing 40 bed residential treatment center for adolescents between the ages of 12 and 18 who have behavioral, school, or emotional problems and who require a long term, high level of care but not necessarily hospitalization in an acute care psychiatric hospital. RTCPB is up and running in Palm Beach County, part of HRS District IX. It is located on the property of Lake Hospital of the Palm Beaches (Lake Hospital). Both are Psychiatric Institutes of America (PIA) subsidiaries. PIA is a subsidiary of National Medical Enterprises, Inc. (NME). RTCPB is accredited by the Joint Commission on Hospital Accreditation in its own right, as is Lake Hospital. Since its opening June 1, 1987, RTCPB has achieved over 85 percent occupancy and enjoys an excellent reputation in the community at large, as well as among those HRS professionals who have cause to come in contact therewith. RTCPB is currently licensed by HRS as a residential child-caring agency under Chapter 395 F.S. and holds certain contracts for care of HRS patients/clients. In addition, RTCPB has an HRS-licensed drug abuse residential program and an HRS-licensed alcohol residential program in place. Nature of the Programs Offered RTCPB's programs consist of three basic areas: a level system, various therapies, and an educational program. These were explained orally at hearing and the oral testimony was fleshed out with a program description and description of the level system (RTCPB 7) and a weekly activity schedule (RTCPB 8) which were admitted over objection. These exhibits were not included as part of the May 27, 1988 "updates," are not updates or amendments to the application, and are the type of evidence both appropriate to, and commonly used in, Section 120.57 (1) F.S. de novo proceedings. The level system is a mechanism for increasing or progressing patients through increasingly responsible behaviors. As patients move through the level system, they take more risks in therapy and accept more responsibilities. A level system not only develops self-esteem and self-control for patients, knowing that they are moving up the system, but also provides a method for the treatment team to monitor and assist patients in their progress and therapy. RTCPB also utilizes numerous individual and group therapies with its patients. RTCPB expects all of its patients to actively participate in all therapeutic activities including individual counselling sessions, group therapies, family therapies, occupational therapies, recreational therapies, and, when applicable, chemical dependency therapies. Patients at RTCPB also actively participate in the school program at the facility. Through the Palm Beach County school system, RTCPB has a homebound program at the facility which includes three teachers and an aide. RTCPB's school program is conducted just like a normal school: the students are taught specific subjects, given homework assignments, tested, and graded. If they successfully complete their work, they should not have suffered any academic time or credit losses when they return to mainstream schooling. Patients are referred to RTCPB in a variety of ways, including but not limited to referrals by their attending physicians, psychologists or other- mental health professionals, ministers, HRS personnel, the juvenile court system, the school system, community mental health centers, outpatient programs, and other inpatient psychiatric care programs. Troubled adolescents and their families also make direct inquiries to the facility. One of RTCPB's "updates", filed May 27, 1988, was a list of referral sources. This "update" (also admitted as RTCPB 11) was never challenged by HRS either by motion for remand or by objection, and constitutes merely material explanatory of the application itself. When a patient is referred to RTCPB, that person is first evaluated by an intake worker or the program director. Thereafter, the potential patient is screened through a child and adolescent psychiatrist. Screening personnel must determine that the potential patient cannot be treated in a less restrictive facility or that he is actually coming from a more restrictive treatment environment before he is accepted for admission. Each patient actually admitted to RTCPB undergoes extensive psychiatric and physical evaluations, unless they have been similarly evaluated within the last 30 days. There are three psychiatrists on staff at RTCPB and one of them makes the final determination concerning each potential patient's admission. The general admitting criteria are that the individual be between the ages of 12 and 18 years old and experiencing a diagnosable behavior disorder based on school, family, emotional, psychiatric and/or substance abuse problems. Admittance is voluntary, but the facility is locked due to the program's acceptance of those who can be dangerous to themselves, others, or property if not closely monitored. Acutely suicidal or homicidal individuals are not accepted, however, and if a patient is grossly delusional or psychotic, he is referred to an acute psychiatric hospital. At RTCPB, clinical staff (program director, nurses, social workers, occupational therapist, recreational therapist, psychologists, and mental health counsellors) predominate in everyday treatment. This contrasts with acute care psychiatric hospitals, wherein psychiatrists have greater direct involvement with the patients than at RTCPB, however, at RTCPB psychiatrists see patients daily, monitor medicine and care, participate in rounds, and are generally responsible for monitoring and overall care. Need There are no hospital licensed Intensive Residential Treatment Programs (IRTPs) in Palm Beach County or in District IX which are up and running. Charter Medical/ Florida Residential Treatment Center (FRTC) has been granted a CON to construct a 60 bed hospital licensed IRTP for children between the ages of 6 and 18. It is not yet operational. This facility will accept dual diagnosis patients but not adolescents with an active diagnosis of chemical dependency or substance abuse. HRS has not promulgated a rule predicting numerical need for facilities seeking specialty hospital licensure as IRTPs under Chapter 395 F.S. HRS elected to evaluate all IRTP CON applications in the context of the statutory criteria of Chapter 381, F.S., and in the context of HRS' non-rule policy establishing a rebuttable presumption of need for one "reasonably sized" IRTP in each HRS planning district. The May 5, 1988 Final Order in Florida Psychiatric Centers v. HRS, et al., DOAH Case No. 88-0008R, held this non-rule policy invalid as a rule due to HRS' failure to promulgate it pursuant to Section 120.54 F.S., but that order also held the policy not to be invalid as contrary to Chapter 381, F.S. That Final Order is in line with the great weight of authority which holds that the burden is upon the agency to explicate and demonstrate the reasonableness of any non-rule policy on a case by case basis. At formal hearing in this cause, HRS put on no evidence of the reasonableness of its policy and asserted only that it still adhered to it as reasonable and meaningful. Interestingly, the agency representative, Elizabeth Dudek, provided information that the policy does not provide any standard as to how "reasonable size" of an IRTP is determined nor does it prohibit more than one IRTP per district. Therefore, if the first applicant for an IRTP facility in any District asks for 100 beds instead of only 60, HRS' policy would not prevent approving a disparate number of beds for identically sized districts. Further, the policy does not provide any guidance as to how to review an IRTP application when there is already one approved but unopened facility in a district, as in the instant case. Upon the testimony of Christie Travis, who, like Ms. Dudek, was qualified as an expert in health care planning, and with no direct contradiction by Ms. Dudek, approval of RTCPB's application is consistent with the number of hospital-licensed IRTP beds HRS has approved in other HRS service districts. To illustrate this point, HRS has approved IRTP beds in other districts at ratios of "beds per 1,000" population ranging from .07 to 1.33 beds. Approval of RTCPB's proposed 40 beds, even counting the Charter Medical/FRTC CON in District IX would only result in a .39 ratio of IRTP beds per 1,000 population in District IX. HRS takes the position that RTCPB is required, in the presence of HRS' non-rule policy, to rebut the presumption that "only one" IRTP is needed per district, regardless of size, but no agency "expertise" was presented at formal hearing to instruct the undersigned how that might be done, and, indeed, HRS failed to affirmatively prove-up the reasonableness of its non-rule policy. Alternatively, HRS takes the position that absent any rule or non-rule policy, the applicant must present some numerical need analysis or need formula in order to bear its initial burden to establish need for the project. This is contrary to precedent, and the applicant must rather establish need upon the panorama of other applicable statutory criteria. However, reflective of actual numerical need in the District, is the unrefuted fact that RTCPB has experienced a rapid census buildup since its opening on June 1,1987. During its most recent months of operation which are February, March, April, and May of 1988, it has experienced 79.0, 84.5, 91.5, and 85.8 percent occupancy respectively. If the requested CON is granted, neither the type of patient admitted, programs and services, discharge mechanisms, nor staffing will change from what is currently being experienced. Ms. Dudek is confident that given the fact that RTCPB is a fairly new facility, it is reasonable to assume utilization of the facility will continue at the rate most recently experienced with or without specialty hospital licensure. Economies and Improvements In Service 381.705(1)(e)i RTCPB's location on the campus of a full service specialty psychiatric hospital (Lake Hospital) contributes to its efficiency, which in turn contributes to cost reduction and economies commonly recognized in health care planning. Cost reimbursements are made by RTCPB to Lake Hospital, but the overall system utilizes economy of scale. Many of the Lake Hospital facilities such as a swimming pool, cafeteria, gymnasium, x-ray, laboratory, biofeedback, and EEG and EKG are available, as needed, to the RTCPB patients. RTCPB can also transfer patients to Lake Hospital, as needed. Because RTCPB and Lake Hospital share the same corporate parent, PIA, they are able to share certain services and personnel, including a Director of Nursing and accounting and payroll personnel Existing and Approved Facilities The only hospital licensed IRTP which can be considered in this proceeding is the prior-batched applicant, Charter Medical/FRTC, which was actually granted its CON by final order intervening between formal hearing herein and entry of this recommended order. IRTPs are in a separate licensure category by law from psychiatric beds, acute care beds, and rehabilitation beds, all of which are present in the District. While FRTC's and RTCPB's programs are similar, and each is clearly an intensive residential treatment program as opposed to a medically-oriented acute care psychiatric facility, there remain significant differences, probably the most significant of which is treatment of substance abuse as a primary diagnosis by RTCPB, noted supra. Although not quantified, RTCPB demonstrated through the unrebutted testimony of witnesses Lehman, Travis, Teahan, and others that substance abuse is a significant factor in the demand for adolescent residential treatment throughout the District. It is reasonable to infer and project that this demand will not be fully met by the construction of FRTC. Additionally, FRTC does not propose to serve a significant percentage of indigent patients. RTCPB already has a contract and rate agreement with HRS to provide residential treatment services at a rate of $195.00 per day per client, which, though subject to adjustment through fiscal year 1989 and further subject to termination by either party without cause upon 30 days' notice, is significantly less than the rate applied by RTCPB to private pay and insurance pay patients. The rate agreement between HRS and RTCPB does not commit RTCPB to accept any HRS clients. Since opening, approximately 24 percent of the patient days at RTCPB have been from HRS patients. The applicant proposed a payor mix of 20 percent commercial insurance, 10 percent private pay, 40 percent HRS, and 30 percent CHAMPUS in its application. At formal hearing, the applicant committed through its party representative, Mr. Lehman, that 20 percent of its patient beds will be HRS beds as long as RTCPB has a fair contract with HRS. Also, during its operation thus far, RTCPB has provided a scholarship or free bed to HRS for patients that need its type of intensive residential treatment but who have no personal, HRS, or other resources to finance it. It is PIA's policy to continue to provide such a bed. The average length of stay (ALOS) for FRTC will be 365 days. RTCPB's application projected an original ALOS of six to twelve months. RTCPB's track record after a year of operation demonstrates an 85 day ALOS, but HRS patients frequently stay longer. RTCPB currently projects an ALOS of 120 days. Where, as here, ALOS can be demonstrated by actual operational figures, that is the type of evidence which should be developed in a de novo proceeding and it has been appropriately considered herein. Availability of Alternatives HRS asserts that the presence of Lake Hospital and FRTC within the District provide/will provide suitable alternatives to the program proposed by RTCPB. Upon the foregoing findings of fact, this is simply not so. Need for RTCPB to be Licensed as a Specialty Hospital While a specialty hospital license is not required for a residential treatment center to operate, and although RTCPB is up and running, given the peculiarities of this type of health care entity, CON licensure potentially gives greater access of the program to insurance company reimbursement, and concomitantly, greater access to the program by those adolescents covered by insurance than if the center continues to operate without a specialty hospital license (CON). Through Mr. Lehman's unrebutted testimony, RTCPB demonstrated that since its opening, RTCPB has had to turn away at least 180 clinically appropriate applicants whose insurance companies failed to honor non-hospital- licensed residential treatment centers. RTCPB's referral of these potential patients to more restrictive mental health programs/facilities does not demonstrate the similarity or "likeness" of those more restrictive programs and facilities to RTCPB, but only demonstrates that patients often have to take health care they can afford even if it is not fully appropriate for their condition, provided it is financially accessible to them. Granting RTCPB's application would render available to this type of patient a less restrictive, more appropriate program, which also has the advantage of being rendered at a lesser cost to their insurance carriers. HRS clearly fears that approval of RTCPB's CON application will result in a preferred acceptance by RTCPB of full-pay insurance-covered patients to the detriment of HRS patients whose fees are price-controlled by the contracts between HRS and RTCPB and further may lead to RTCPB unilaterally cancelling these contracts. The HRS position that it should deny a CON to an otherwise qualified applicant so as to maintain a perceived advantage in admission of its own clients is fundamentally unfair. Such a position cannot be justified on grounds of insuring indigent accessibility. In addition to being speculative, HRS' view is not supported by the record. One may as easily conjecture that approval of RTCPB's application may have just the opposite effect. Until very recently, RTCPB has been treating HRS patients at the all-inclusive rate of $185 per day, as opposed to the standard rate of $255. These rates have recently been raised to $195 per day for HRS patients and $275 for non-HRS patients. RTCPB does not make a profit on HRS patients. Therefore, RTCPB witnesses asserted that to be able to continue treating its current high level of HRS patients, RTCPB seeks access to the commercially insured patient base that can provide the additional necessary revenues. There also is insufficient evidence to provide any corollary which would suggest that had RTCPB been able to acquire the 180 patients turned away on insurance reimbursement grounds, HRS patients would have been displaced. Conformity With The Applicable Health Plans HRS concedes that the existence of RTCPB, as presently constituted, is consistent with the goals and objectives contained in the applicable State Health Plan, and it is specifically found that the program at RTCPB addresses the State Plan's goals of helping substance abusers and of achieving a range or network of different types of care for severely emotionally disturbed children and adolescents. However, HRS submits that CON approval does nothing to advance these goals because it is already in existence. It is found that the proposal not only is in conformity with the State Health Plan but advances it through greater availability of RTCPB's program to all potential patients, including those formerly denied by their insurance companies. Although the applicable District IX Health Plan does not specifically name IRTPs, it addresses the need therefor in general goals of making psychiatric and substance abuse services available to all individuals in District IX. In view of RTCPB's substance abuse emphasis and its variance in ages served compared to those to be served by FRTC, RTCPB's turn-away rate and the District demand, and what even Ms. Dudek describes as RTCPB's "commendable" history of servicing HRS patients, together with the greater accessibility RTCPB will provide to insurance-covered patients if the CON is granted, it is found that RTCPB will advance the District Health Plan. Financial Feasibility David J. Rabb, Vice-President of J. L. Little & Associates, a financial consulting firm, was accepted as an expert in health care finance and financial feasibility. He prepared pro formas for the facility for fiscal years (FY) 1989, 1990, 1991, and 1992, each with and without the specialty hospital license. HRS objected to these items (RCTPB 20), which had been part of the pre-filed application "updates". However, HRS declined to move for remand and did not assert that these pro formas were substantial amendments to the application. Instead, HRS only took the position that since a CON application must be deemed complete upon filing, only such updates which are the result of "changed circumstances beyond the control of the applicant" are admissible in the de novo review". HRS demonstrated no prejudice to its position by the admission of these pro formas. There is clear precedent that admission of such "updates" is entirely appropriate in de novo non- comparative CON proceedings. Furthermore, since these pro formas were based upon RTCPB's actual operating experience, none of which was available at the time the original application was filed because the facility had not yet opened, the updated pro formas are precisely the type of accurate information/evidence which should be encouraged in this type of proceeding, as well as meeting HRS' expressed desire that they address "changed circumstances". The pro formas admitted were based on a room, board, and nursing care (RBN) rate of $275 per day for FY 1989 and assumed an average rate of increase of 5 percent per year for the years 1990-1992. For FY 1989, Mr. Rabb projected an after tax loss of $1,000 under the "without license" scenario as opposed to an after tax profit of $78,000 under the "with license" scenario. For FY 1990 through 1992, Mr. Rabb projected an after tax profit of between $38,000 to $62,000 under the "without license" scenario as opposed to an after tax profit of between $160,000 to $195,000 under the "with license" scenario. This is reasonable and unrebutted. The project is financially feasible and the financial feasibility of the facility would be improved if RTCPB were awarded a specialty hospital license CON. Impact on Costs and Competition If the CON is granted, RTCPB will provide some minimal competition for treatment of certain types of patients that Charter Medical/FRTC also will serve when it is constructed, (that is, insurance-covered patients between the ages of 12 and 18 with dual diagnoses, of which substance abuse is not the primary diagnosis). However, given the demand for intensive residential treatment, RTCPB's failure to address the 6 to 11 age group addressed by FRTC, and since FRTC will not seek out primarily diagnosed substance abusers such as are accepted by RTCPB, this competition will be minimal. The impact, it any, of RTCPB, which is already up and running at 85 percent+ occupancy, will be positive.
Recommendation Upon the foregoing findings of fact and conclusions of law, it is recommended that HRS enter a Final Order approving RTCPB's CON application for licensure as a specialty hospital. DONE and RECOMMENDED this 16th day of September, 1988, at Tallahassee, Florida. ELLA JANE P. DAVIS, Hearing Officer Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 16th day of September, 1988. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-5371 The following constitute specific rulings upon the parties' respective proposed findings of fact (PFOF) pursuant to Section 120.59 (2) F.S. Petitioner's PFOF: Accepted. Accepted but a "given" and unnecessary. 3-10. Except as subordinate or unnecessary, accepted. 11-13. Mere legal argument is rejected, the remainder is accepted and rejected as described and explained in FOF 12-16 and the Conclusions of Law (COL) 14-18. Except as subordinate or unnecessary to the facts as found, accepted. Except as cumulative or unnecessary to the facts found, accepted. Accepted. 21 Rejected as unnecessary. Rejected as mostly argument. The record is clearly and accurately reflected at FOF 24. Except as unnecessary or as argument, accepted. Accepted to the extent it reflects the direct testimony of Mr. Lehman, but the speculative nature of each party's position is also recognized and discussed in terms of substantial evidence in FOF 27 and the COL, without the subordinate and unnecessary assertions and mere argument. 25-28. Except as subordinate, unnecessary, cumulative, or mere argument, accepted. 29-31. Accepted in substance but rejected as mere argument, cumulative, and subordinate. Same ruling as just above, but additionally this merely recites unreconciled testimony. Accepted Rejected as mere argument; premise accepted. 35-45, 48-50. Except as subordinate or cumulative to the facts as found, accepted. The continued, repetitive argument has also been rejected as such. The asserted "facts" as to competition are accepted in part and rejected in part for reasons detailed in the FOF, which accurately reflect the record herein. 46-47. Accepted. Respondent's PFOF: 1-17. Except as subordinate, unnecessary, or cumulative to the facts as found, accepted. There are also some errors of citation to the record. 18-20. Rejected. This is not what the testimony and exhibits indicate. Payor mix, patient days, and percentage of patient beds are different measurements. Comparing them is like comparing apples and monkeys because patient beds is a component of patient days; payor mix is entirely different. 21-27. Accepted. Accepted in substance but applies to only certain patients and is rejected as subordinate to the facts as found. Except as subordinate and unnecessary, accepted. 30-31. Rejected as argument; in substance, covered in introductory material, FOF, and COL. 32-38. Accepted but subordinate and not dispositive in isolation and therefore not adopted. 39. Rejected as recitation of only part of the testimony. It does not consider the clear differentiations recognized by the new organic law, HRS' own CON rules, and the remainder of the record as a whole. 40-42. Accepted in substance. As to PFOF 42, it is incomplete as to the several differences, including intensity of the medical components in acute care discussed in the facts as found with regard to acute care facilities in general and Lake Hospital in particular. Treatment elsewhere outside of RTCPB as stated in the context of this proposal is unconnected to any material issue herein. To the extent it may be relevant or material, it is covered in the facts as found. Rejected in part and accepted in part for the reasons set out in the FOF 12-16 and upon the record as a whole. Rejected as argument but the substance is addressed in the FOF and COL. See next ruling, too. Accepted in the sense of a numerical needs analysis only. Although the hearing officer notes that this proposal encompasses counsel's understanding that agency rulings on exceptions in a prior case have recognized that in the absence of a rule, the hearing officer is correct to weigh such need methodologies if they are presented by the parties, this is not the situation at bar and is not controlling. See FOF 12-16 and COL. 46. Rejected. See FOF 12-16, 20-25, 32. 47-48. Accepted. Accepted as to what the State Plan calls for; rejected as to nonconformity for the reasons set forth in FOF 28-29. Rejected as not Supported by the record, for the same reasons given above for PFOF 18-20, and as cumulative See FOF 22 and 27. 51,53, 55-57, 62. Accepted in part and rejected in part as mere argument and cumulative to the facts as found and for the reasons set forth in FOF 28-29 and the COL. 52,54. Accepted in substance but not dispositive as an isolated fact; see FOF 25 and 32. Accepted. Rejected in FOF 27. 60,63. Rejected for the reasons already stated and as cumulative to the facts as found. See FOF 27, 32 and COL. 61. Rejected as subordinate. Rejected as not supported by the record as a whole. Accepted but unnecessary. 66-67, 70. Rejected as cumulative to previous proposals and to the facts as found for reasons previously stated. See FOF 12-16, 27, and 32. Rejected as argument or mere recitation of testimony. Rejected as not supported by the record and as mere argument. 71-72. Rejected as stated. In part rejected as not supported by the record and in part cumulative to previous proposals and the facts as found, for the reasons previously stated. See FOF 25 and 32, and the COL. 73-74. Covered in introductory material, FOF (especially 17-19) and COL. 75. There is none. 76 #1. Rejected as stated in part as not supported by the record, and in part cumulative to previous proposals and the facts as found for the reasons previously stated. See FOF 25-29 and COL. 76 -2. Accepted. 77-80, 82. Accepted in part and rejected in part for the reasons set out in the introductory material, FOF 30-31, and the COL. 81,83. Rejected as subordinate to the facts as found. The latter part of 81 is not supported by the record. See previous rulings and FOF 22, 27. 84-85. Rejected as subordinate and not dispositive; partly unproved. 86-89. Rejected in various parts as mere argument, as not supported by the record, and as cumulative. As noted in previous rulings, HRS is confused about the differences in payor mix, patient beds, and patient days. RTCPB has a good history of indigent and HRS patient care, see FOF 22-23 and 27. On financial feasibility, see FOF 30-31. 90-91. Rejected as immaterial and mere argument or as covered in FOF 22-23 and 27. 92. Rejected in part and accepted in part for the reasons set forth in the FOF and COL. COPIES FURNISHED: Sam Power, Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 Michael J. Glazer, Esquire 227 South Calhoun Street Post Office Box 391 Tallahassee, Florida 32302 John T. Brennan, Jr., Esquire 900 17th Street, Northwest Washington, D.C. 20006 Lesley Mendelson, Esquire Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 Gregory L. Coler, Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700
