The Issue Vitas Healthcare Corporation of Florida, Inc., and Heartland Services of Florida, Inc., each filed applications with the Agency for Health Care Administration to establish a new hospice program in Duval County, Hospice Service Area 4A, in the second batching cycle of 2004. The issue in these consolidated cases is whether either, both or neither of the applications should be approved.
Findings Of Fact The Parties AHCA The Agency for Health Care Administration is designated by Section 408.034(1), Florida Statutes, "as the single state agency to issue . . . or deny certificates of need . . . in accordance with present and future federal and state statutes." Accordingly, it is the state agency responsible for issuing or denying the applications for certificates of need sought by Heartland and VITAS in this proceeding. Heartland Heartland is a subsidiary of Manor Care, Inc. ("Manor Care"), a company traded on the New York Stock Exchange. Manor Care through various subsidiaries operates approximately 279 nursing homes, 65 assisted living facilities, 89 rehabilitation clinics, and 94 home health agencies and hospices. To the extent these operations require buildings, Manor Care owns the majority of them. While many companies offer one service or another of those offered by Manor Care, the company's ability to offer the variety of health care services in its portfolio enables it to provide continuum of care to its patients. In Florida, Manor Care, through its subsidiaries, operates "just under 30 nursing homes, three . . . in the Jacksonville market." Tr. 31. It operates 11 assisted living facilities in Florida, 29 rehabilitation facilities (14 of which are in the Jacksonville area), and six home health operations. Neither Heartland nor any of the healthcare companies with which it is affiliated through Manor Care operates a hospice program in Florida. But Manor Care operates 86 licensed hospice programs in the United States, the greatest number of any company operating hospices in the country. It commenced hospice operations in 1995 with approximately 58 patients; its hospice census at the time of hearing exceeded 5,600 patients. Heartland's proposed hospice program will be similar to Manor Care's programs in other states, and Heartland will use Manor Care's considerable hospice experience outside of Florida to assist Heartland in operating the proposed hospice if its CON application is approved. Heartland's proposal to provide hospice services in the Jacksonville area, moreover, will offer the opportunity to enhance continuum of care for patients in the area who decide to choose Heartland for hospice in addition to home health care, rehabilitation services or nursing home services. VITAS VITAS Healthcare Corporation of Florida, Inc., ("VITAS" or "VITAS the Applicant"), and the Petitioner in DOAH Case No. 04-3856CON, is a wholly-owned subsidiary of Vitas Healthcare Corporation ("VITAS the Parent.") VITAS the Parent operates 39 hospice programs nationwide and provides services to more hospice patients than any other hospice provider in the country. In 2004, VITAS the Parent merged with Comfort Care Holding, a subsidiary of Chemed Corporation (Chemed). As a result of the merger, VITAS the Parent became a wholly owned subsidiary of Chemed. Chemed is a for-profit corporation that operates under the trade name Roto-Rooter and describes itself as North America's largest provider of plumbing and drain cleaning services. The acquisition of VITAS the Parent by Chemed was made to allow Chemed shareholders to realize 100% of the revenue and earnings of VITAS the Parent. The Chemed acquisition was preceded by significant contributions of VITAS the Parent and its affiliates to the hospice movement in this country. A pioneer in the hospice movement, VITAS the Parent offered hospice services in Florida more than 28 years ago. One of the first hospice programs in the country was a Miami-Dade program affiliated with VITAS the Parent. The program was organized by Huge Westbrook and Esther Colliflower, a Methodist minister and a nurse with an oncology background, respectively, who were both professors at Miami-Dade Community College teaching courses on death and dying issues. VITAS the Parent was also instrumental in the development of hospice licensure standards in Florida and the establishment of the federal Medicare benefit for hospital services. Over this three-decade stretch of time, VITAS the Parent has also been a leader in hospice research and development and has created pain management tools and hospice care manuals that are widely used by other hospice providers across the nation. For example, it developed the Missoula-VITAS quality of life index, licensed and used by over 150 hospices nationwide. The publication 20 Common Problems in End of Life Care was authored by employees of VITAS the Parent and is used as a textbook for delivery of hospice care. In recent years, VITAS the Parent has provided hospice services to more hospice patients than any other hospice provider in the country. In 2004, VITAS programs admitted over 46,000 patients with an average daily census of 9,000. In 2005, VITAS national admissions increased more than 8% to over 50,000 patients with an average daily census of over 10,000. Provision of hospice services through VITAS the Parent's affiliates has expanded recently. In the past three years alone, 15 operational hospices affiliated with VITAS the Parent have been added. In the hospices operated around the country, all Medicare-certified, VITAS earned over $531 million in 2004, growing to over $600 million in 2005. In Florida, affiliates of VITAS the Parent currently operate a number of licensed hospices. These include programs located in Miami-Dade County (Service Area 11), Broward County (Service Area 10), Palm Beach County (Service Area 9C), Orange, Osceola and Seminole Counties (Service Areas 7B and 7C), Brevard County (Service Area 7A), and Volusia and Flagler Counties (Service Area 4B). Of licensed hospices operated in Florida by subsidiaries of VITAS the Parent, three are operated by VITAS the Applicant: one each in Dade, Broward, and Palm Beach County. VITAS the Applicant considers itself to be Florida’s largest hospice and the dominant existing licensed hospice provider in Florida. Whether all parties would agree with that characterization, there is no question about VITAS the Applicant's place among the subsidiaries of VITAS the Parent. VITAS the Applicant is the “major contributor of revenue to Vitas Healthcare Corporation on a consolidated basis.” Tr. 946. Described by the controller of VITAS the Parent as a “cash cow,” VITAS the Applicant “makes VITAS [the Parent] as a whole a very healthy organization [financially].” Id. In 2004, the hospice programs in Florida affiliated with VITAS the Parent collectively admitted more than 16,000 hospice patients. The average daily census for these programs was 3,500 with earnings of over $210 million. All of the hospice programs affiliated with VITAS the Parent are in full compliance with Medicare conditions of participation and none have exceeded Medicare cost caps. Community Community Hospice of Northeast Florida ("Community" or "CHNF"), the Petitioner in DOAH Case No. 04-3886CON, is a not- for-profit Florida corporation, licensed by the State of Florida to operate Northeast Florida Community Hospice in Service Area 4A, serving Baker, Clay, Duval, Nassau and St. Johns Counties. Community was established by a group of volunteers in 1978. Its mission is to improve the quality of life for hospice patients and families and to be the compassionate guide for end- of-life care in the community it serves. It has history of high quality of care, the breadth of which was demonstrated in multiple areas that included community education, bereavement, outreach, and pediatric hospice care. Community also operates a separately licensed pharmacy and a durable medical equipment provider service. Among the issues pled by CHNF's petition in DOAH Case No. 04-3886CON are the following: Material issues of disputed fact to be resolved at hearing include, but are not limited to: * * * b. Whether Heartland's Application, and whether the CON Applications of any co- batched Applicant who files a Petitioner [VITAS], complies with the applicable criteria in Chapter 408, Fla. Stat., and Rules 59C-1.008, 59C-1.030 and 59C-1.0355, F.A.C. * * * Community Hospice alleges that the specific statutes and rules at issue in this case include, but are not limited to, §408.035, §408.037, Fla. Stat., and Rules 59C-1.008, 59C-1.030, and 59C-1.0355, F.A.C. Community Hospice of Northeast Florida, Inc.'s Petition for Formal Administrative Hearing, pp. 4-5. Overview of Hospice Care Hospice care is provided to patients who are terminally ill. As "end of life" care, it is entirely palliative; curative treatment is not a part of the hospice regimen. Hospice admission eligibility criteria require that the patient's condition be certified as terminal by an attending physician or hospice medical director with less than six months to live and, of course, that the patient's wishes include hospice or palliative care services. Hospice care is holistic. It provides physical, emotional, psychological and spiritual comfort and support to a dying patient and considers the patient and the patient's family to be a unit of care. Hospice services are provided by a team of professionals: physicians and nurses who provided skilled nursing care, home health aid services, social worker services, chaplain and religious counseling services and bereavement services for the family left of the patient after death. Hospice care may be provided in location where a patient has lived or is temporarily residing such as a private home, family member's home, assisted living facility (ALF), nursing home, hospital or other institution. There are four basic levels of hospice care: routine home care, general inpatient care, continuous care, and respite care. The majority of hospice patients receive routine home care: care in their own residences whether it be their home, a family member's home, a nursing home, or an ALF. Routine home care comprises the vast majority of hospice patient days. Continuous care is also provided in the patient's home. Unlike routine home care, continuous care is for emergency care or control of acute pain or symptom management. The term "continuous" to describe this type of hospice care is something of a misnomer. Continuous care is typically intermittent but requires a minimum of 8 hours of one-on-one care in a 24-hour period with at least 50% of the care provided by a nurse. The continuous care patient usually has a higher level of acuity than the hospice patient that is receiving general inpatient care. Aside from the difference in acuity level, the continuous care patient is different from the patient receiving general inpatient care because the continuous care patient has made the choice to remain at home, despite the patient's need for emergent care, acute pain relief, or symptom management that is also appropriate in an inpatient setting. As the term indicates, the hospice patient receiving general inpatient care is in an inpatient setting such as a hospital, the sub-acute unit in a nursing home or in a freestanding hospice unit. This type of care provides increased nursing care for patients with symptoms temporarily out of control and in need of round-the-clock nursing, although generally at a lower level of care than the continuous care hospice patient. Respite care is provided to patients in an institutional setting such as a nursing home, ALF or a freestanding hospice unit in order to allow care givers at home, such as family members, a short break or "respite" from the demands of caring for a terminally ill patient. Medicare Reimbursement Medicare provides reimbursement for hospice care and is by far the largest payer for hospice care. Medicare reimburses different rates for hospice based on each of the four basic levels of hospice care. Hospice regulations consider certain hospice services to be "core services": nursing, social work, pastoral or other counseling, dietary counseling, and bereavement services. Referral Sources The main sources of referrals for hospice are hospitals, nursing homes, ALFs, and physician groups. Stipulation The Parties stipulated to the following: AHCA published a fixed, numeric need for one new hospice program in District 4A for the first batching cycle of 2004. No challenges were filed to that published fixed need determination. Vitas and Heartland each timely filed letters of intent, initial applications, and omissions responses proposing to establish a new hospice program in District 4A, in response to AHCA's published fixed need for one new program. AHCA issued its State Agency Action Report preliminarily approving Heartland's CON application 9783, and preliminarily denying Vitas' CON application 9784. Notice of AHCA's decision was published in the September 10, 2004, Florida Administrative Weekly, Vol. 30, No. 37. Community has a history of providing high quality hospice services in District 4A, and has standing in this proceeding. Heartland and Vitas each have the ability to provide high quality hospice services in District 4A, should their respective CON applications be approved. All parties reserve the right to present comparative evidence related to any party's quality of care. All Parties agree that the project costs identified in Schedule 1 of each CON application are reasonable, appropriate, and are not in dispute or at issue in this proceeding. * * * Heartland and Vitas each satisfy the CON review criteria contained in section 408.035(3) pertaining to ability of the applicant to provide quality of care and the applicant's record of providing quality of care. The CON review criteria set forth in subsections 408.035(8)(cost and methods of proposed construction), and (10) (designation as a Gold Seal program nursing facility) are not applicable to this proceeding. Agreed Joint Pre-hearing Stipulation, filed February 20, 2006. Numeric Need in Service Area 4A On April 29, 2004, AHCA published its determination that there is a fixed numeric need for one new hospice in Service Area 4A for the planning horizon at issue in this case. The fixed need pool was calculated by AHCA using a fixed numeric need methodology for hospices. The hospice numeric need methodology is found in Florida Administrative Code Rule 59C-1.0355 (the "Hospice Programs Rule"). Section (4) of the Hospice Programs Rule is entitled, "Criteria for Determination of Need for a New Hospice Program." It has several subsections, the first of which, subsection (a), bears the catch-line, "Numeric Need for a New Hospice Program." Subsection (a) sets out a particular need methodology for determining the numeric need for new hospice programs (the "Hospice Numeric Need Methodology"). The Hospice Numeric Need Methodology Subsection (4)(a) of the Hospice Programs Rule, sets forth the Hospice Numeric Need Methodology. It is, in part, as follows: Criteria for Determination of Need for a New Hospice Program. Numeric Need for a New Hospice Program. Numeric need for an additional hospice program is demonstrated if the projected number of unserved patients who would elect a hospice program is 350 or greater. The net need for a new hospice program in a service area is calculated as follows: (HPH) - (HP) >= 350 where: (HPH) is the projected number of patients electing a hospice program in the service area during the 12 month period beginning at the planning horizon. * * * (HP) is the number of patients admitted to hospice programs serving an area during the most recent 12-month period ending on June 30 or December 31. The number is derived from reports submitted under subsection (9) of this rule. 350 is the targeted minimum 12-month total of patients admitted to a hospice program. Fla. Admin. Code R. 59C-1.0355. Aside from the formula for calculating numeric need, quoted in the previous paragraph, the Hospice Numeric Need Methodology is quite detailed. It requires that a number of different values used by the methodology be determined prior to the calculation required by the numeric need formula. For example, it calls for assessments of the projected number of service area resident deaths in various categories dependent on age and whether the death was due to cancer or not. "Projected deaths" are defined and determined by the Hospice Need Methodology Rule as follows: "Projected" deaths means the number derived by first calculating a 3-year average resident death rate, which is the sum of the service area resident deaths for the three most recent calendar years available from the Department of Health and Rehabilitative Services' Office of Vital Statistics at least 3 months prior to publication of the fixed need pool, divided by the sum of the July 1 estimates of the service area population for the same 3 years. The resulting average death rate is multiplied by projected total population for the service area at the mid-point of the 12- month period which begins with the applicable planning horizon. Population estimates for each year will be the most recent population estimates published by the Office of the Governor at least 3 months prior to publication of the fixed need pool. Fla. Admin. Code R. 59C-1.0355(4)(a) (emphasis supplied.) The underscored language in the Hospice Numeric Need Methodology, quoted above, clearly shows that population data, in the form of estimates and projections of certain populations of the service area, is taken into consideration in the calculation of numeric need. In addition to the Hospice Need Methodology found in paragraph (a), Subsection (4) of the Hospice Programs Rule has several other paragraphs that relate to approval. Their application occurs on alternative bases when there is numeric need or in the absence of numeric need. These paragraphs relate to the effect of "licensed hospice programs," and "approved hospice programs," on determinations of numeric need greater than zero and "approval under special circumstances" in the absence of numeric need. Licensed Programs and Approved Programs Even if the Hospice Needs Methodology yields a numeric need for hospice programs in a hospice service area, "the agency shall not normally approve a new hospice program . . . unless each hospice program serving that area has been licensed and operational for at least 2 years as of 3 weeks prior to publication of the fixed need pool." Fla. Admin. Code R. 59C- 1.0355(4)(b). Likewise, even where the methodology yields numeric need, "the agency shall not normally approve another hospice program for any service area that has an approved hospice program . . . not yet licensed." Fla. Admin. Code R. 59C- 1.0355(4)(c). Subsections (4)(b) and (c) of the Hospice Programs Rule immediately precede subsection (4)(d). Subsection (4)(d) is the converse of (4)(b) and (c). Instead of no approval despite numeric need, it provides for approval when there is no numeric need under special circumstances. Special Circumstances Subsection (4)(d) of the Hospice Program Rule bears the catchline: "Approval Under Special Circumstances." Those circumstances are detailed as follows: In the absence of numeric need identified in paragraph (4)(a), the applicant must demonstrate that circumstances exist to justify the approval of a new hospice. Evidence submitted by the applicant must document one or more of the following: That a specific terminally ill population is not being served. That a county or counties within the service area of a licensed hospice program are not being served. That there are persons referred to hospice programs who are not being admitted within 48 hours (excluding cases where a later admission date has been requested). The applicant shall indicate the number of such persons. Fla. Admin. Code R. 59C-1.0355(4)(d). A conclusion to be drawn from Subsection (4)(d) of the Hospice Programs Rule is that in the absence of a showing of special circumstances, the number of applications granted may not exceed the numeric need yielded by the Hospice Numeric Need Methodology. See Conclusions of Law, below. Existing Providers Service Area 4A is served currently by two hospice programs. Community has provided hospice services since 1978 and Haven Hospital (formerly North Central Florida Hospice based in Gainesville) since 2001. Community has over 700 employees. During fiscal year 2004, Community cared for over 5,000 patients and their families. During the same time period, the average daily census was 844 patients and the average length of stay ("ALOS") was 61.5 days. Forty-two percent of the patients had cancer as their primary diagnosis. The remainder of the patients (58%) had a primary diagnosis that was not cancer. Community provides services to hospice patients and families regardless of age, race, religion, gender, ethnic background, handicap, diagnosis or ability to pay and is certified to serve Medicare and Medicaid patients. Community's roots in Service Area 4A are deep. For example, its CEO and president, Ms. Susan Ponder- Stansel, has lived and worked continuously in Jacksonville and St. Augustine since 1980. She is a member of community organizations that provide an excellent vantage point on the needs of the community, including the Board of the District IV Health Planning Council, the Rural Health Network, and the Advisory Board of the Malone Cancer Institute at Baptist Medical Center. Community is governed by a Board of Directors with 30 members, representatives of a multitude of the communities in Service Area 4A. The Board includes community volunteers, physicians and representatives of each of the major hospital systems. Hospital representatives on CHNF's Board ensure the best collaboration and outreach to hospital patients who are hospice eligible. It allows the formation of partnerships for the development of additional services to fill any gaps between hospice and hospital care. Community encourages and receives input from its St. Augustine/St. Johns Advisory Board and its Clay County Advisory Board, consisting of more than 20 members each. Advisory Board members advise CHNF of additional ways hospice services can be made accessible and available to the residents of those areas. Community has made hospices services accessible and visible throughout the entire service area by strategically establishing offices and facilities to serve each of the metropolitan and the rural communities of the service area. As one might expect from any new hospice program, Heartland and VITAS the Applicant have only committed to office space in Duval County. VITAS proposes to rent such office space and might rent space elsewhere for satellite offices. Heartland proposes to establish its primary initial office in Duval; otherwise, it "will look at the need for satellite offices to ensure that the five-county are is covered." Tr. 274. Community has a history of providing high quality hospice services in Service Area 4A. It provides all levels of hospice care, including respite and continuous care, and has demonstrated the capacity to organize and deliver core hospice and other hospice services in a manner consistent with all regulations and prevailing standards for hospice care. Although most hospice patients prefer to remain in their own homes during the dying process, some symptoms require management with a higher level of 24-hour acute care. Three venues may be provided by a hospice to deliver general inpatient care to a hospice patient. One method is to use beds scattered throughout an acute care hospital or nursing home as they are available ("scatter beds"). Another is to establish a hospital- based inpatient unit specifically dedicated to hospice patients operated in leased space and staffed by hospice employees. The third is to establish a freestanding hospice inpatient facility. Freestanding facilities are generally more home-like than scatter beds or dedicated space in a hospital. Heartland and VITAS propose to contract with nursing homes and hospitals to provide general inpatient care on a scatter bed or single bed basis as needed. Community offers such care in freestanding facilities, hospital-dedicated leased space, and scatter beds so it can allow the patient's needs to determine the venue of choice. Community has two general inpatient facilities. The Hadlow Center of Caring is a 38-bed, freestanding Medicare certified facility centrally located in the service area and easily accessible from I-95, I-295, and US-1. The Morris Center is a 16-bed Medicare-certified dedicated facility located in Shands Hospital in the demographic and geographic center of metropolitan Jacksonville. The Hadlow Center, notwithstanding its medical mission to provide crisis intervention for hospice patients, is designed and operated to create a home-like environment for patients and families enduring end-of-life crisis. It has unlimited visiting hours. Patients can decorate their rooms with their own mementoes. Pets can visit. There are lanais and outdoor areas for patients and families to use. All 38 beds at Hadlow are certified for general inpatient care. Some of the beds are used by CHNF for residential patients -- patients eligible for routine home care, but who either have no caregiver at home, no home, or an unsafe environment at home. Although CHNF is reimbursed for the routine home care, it is not reimbursed by any third party payor for providing residential care. If the patient lacks the ability to pay, CHNF provides the residential bed at Hadlow free of charge. The Morris Center is operationally similar to the Hadlow Center with many of the same amenities, but it is located in a hospital. The Neviaser Educational Institute at Community Hospice of Northeast Florida is a department of the Hospice created in 2003 to provide education to the community and the hospice's employees on end-of-life issues. The Institute has grief and loss, professional education, and a community relations component. Since its inception, the scope and breadth of the professional education provided by the Institute has been significant. In November of 2005, for example, the Institute provided 1,874 hours of education to 1,421 persons (703 staff and 718 community). The hours of education were apportioned 1,448 to unlicensed professionals/students/lay persons, 371 to nurses, 41 to social workers and 13 those seeking continuing medical education (CME) credits. Community is the only hospice in the state authorized by the Florida Medical Association to conduct CME. Although the need for community education can never be fully met by any one provider, and additional education will likely always be needed, CHNF's community education and community grief and loss programs have been thoughtfully designed and delivered. They are efficacious in developing a larger community sense of how to manage grief and loss and in communicating the availability of hospice to deal with those issues. Community PedsCare is an innovative program established by CHNF in collaboration with Wolfson Children's Hospital, Nemours Children's Clinic and the University of Florida. The program provides palliative and hospice services to children (up to 21 years of age) who have been diagnosed with a life-threatening disease, injury, illness or condition, and to the families of these children. Community operates an in-house pharmacy allowing it to dispense prescribed medications to patients in their homes and in CHNF's general inpatient facilities. Community operates its own in-house durable medical equipment department. This enables greater control to ensure prompt delivery when needed and timely pick-up which is not always of concern to for-profit contract vendors of durable medical equipment. The location for CHNF's Gateway Mall Branch Office was specifically chosen to enhance access for African-Americans in the Service Area 4A, the preponderance of whom live proximate to metropolitan and Northwest Jacksonville. The Morris Center for Caring, one of CHNF's general inpatient facilities, was located at Shands Hospital in downtown Jacksonville, specifically because it is in the geographic center of the City, and it is where most of the SA's African- Americans come to receive their healthcare. CHNF has employed a Community Education Manager for the past two and a-half years. She was previously employed by the City of Jacksonville's Human Rights Division for three years to initiate a community dialogue of race relations. For the preceding 20 years she acquired an understanding of the Jacksonville and neighboring counties in Service Area 4A working as manager for a home health agency that, like hospice, primarily delivers healthcare in the patient's home. CHNF's Community Education Manager has had an excellent opportunity to observe how healthcare is, or is not, delivered to African- Americans and minorities and has experience in the difficulties unique to educating African-Americans about the availability of home health and hospice. The community education manager has developed outreach and education programs specifically targeting African-Americans, other ethnic group and Veterans. A significant barrier to higher utilization of healthcare services by African-Americans, which is not unique to Jacksonville, is a historical distrust of healthcare, passed by word of mouth and based on the disparities in treatment African- Americans have experienced. Many physicians are not comfortable, even today, treating African-Americans. As a consequence of disparate treatment, African-Americans are less likely than their Caucasian counterparts to trust or allow a stranger to provide end-of-life care to themselves or a member of their family. To address these barriers, CHNF has recognized that it takes time, persistence, consistency, and commitment to develop a trust in hospice that will overcome years of generalized mistrust of healthcare professionals and the healthcare delivery system. Community management fully supports and historically has implemented diversity training for all of it staff. Community has been very successful in increasing the number of African-American churches and corresponding faith based communities which will allow hospice to make educational presentations. There are a great number of African-American churches in Jacksonville. In FY 2005, CHNF made over 390 visits and made 24 presentations in African-American Churches. Community has focused on African-American women and makes numerous presentations to African-American women's groups because, more often than not, women are the heads of households and are the caregivers to families and friends in the African- American community. Community conducts conferences and workshops with clergy of a variety of denominations to address issues specific to African-American end of life and access to healthcare. If for any reason, including lack of funds, the above programs were pulled back or diminished, it would be like starting over to rebuild trust in the African-American community. Community hired an African-American public relations firm to tailor a number of CHNF brochures specifically to African-Americans. Community has developed effective printed material utilizing testimonials from African-Americans, and succinct wording about topics as varied as how to ask your physician questions, where to get caregiving information and the availability of compassionate care at CHNF for African- Americans. Community places articles and advertising in the Jacksonville First Coast Edition of Black Pages USA, which serves and is distributed to African-American families and businesses in Jacksonville, Orange Park, St. Augustine, Middleburg, Yulee, Callahan, Baldwin, Jacksonville beaches and surrounding areas. Community's outreach to the African-American community in Service Area 4A is having success. In short, CHNF is an available, high quality, full- service hospice. Because of its not-for-profit status and current economies of scale, CHNF is able and willing to fund unique and effective community and professional education, community outreach, and a variety of enhanced services to its patients, their families and the communities in Service Area 4A. Heartland's Application Heartland's hospice care is delivered by an interdisciplinary team. The team consists of a registered nurse, social worker, spiritual care coordinator, volunteer and bereavement coordinators, the attending physician, the hospice medical director, volunteers and therapists. The therapists come from a variety of disciplines: physical, occupational, speech and alternative therapies such as music, art, or massage therapy. Which therapists comprise an individual patient's interdisciplinary team depends on the patient's plan of care. On admission, Heartland patients are provided a hospice client handbook describing available hospice benefits for patients and families. Patients and their families are provided a telephone number to call with any questions or requests for assistance. Foreign language materials are available, as are interpreters and services for the deaf. Heartland's hospice services are available 24 hours a day and seven days a week. Upon hospice admission to Heartland, a plan of care is developed by the interdisciplinary team, including the physicians, in consultation with the patient and family to determine the kinds of care and services needed. Every 14 days the team meets to review each patient's plan of care to ensure the care is evaluated for effectiveness and any changes in services or care that may be needed. Heartland's plan of care for each patient addresses all orders and treatments that are directed by physicians and the needed frequency and types of services and treatments. The plan is implemented by the entire interdisciplinary team, including the attending physician and the medical director. Patients may choose to have the hospice medical director assume patient care or may choose to retain their attending physicians. In the latter case, the attending physician and the hospice medical director work closely together. Each Heartland patient is assigned to a specific interdisciplinary team that oversees all of the patient's care. That team cares for the patient and family throughout the hospice stay irrespective of changes in the level of care needed. Continuity of care is therefore achieved. Bereavement services are provided through the Heartland interdisciplinary team for families and communities up to 13 months post death. Services include one-on-one counseling, community grief support groups, and memorial services. Bereavement needs are anticipated and assessed upon admission and throughout the care, and assessed again after a death to ensure bereavement needs of the family are met. A bereavement plan of care is established with the family and the bereavement coordinator, which may include visits and other forms of contact. Grief support groups meet at locations that are convenient to community and family needs, which may be at a variety of community buildings. Heartland has developed bereavement specialty programs that include spouses and children, including day or weekend childrens' camps throughout Heartland hospices across the country. Heartland has also provided specialty support groups for the spouses of veterans who have lost their lives in war. Heartland programs hold memorial services for all of the patients who have died. One-on-one bereavement counseling is always available. The frequency of counseling depends on the needs of the individual. Heartland's bereavement counselors have extensive experience in grief counseling. Some are also social workers. They are often called upon to conduct crisis intervention. Heartland, therefore, has specific required qualifications for bereavement counselors. New employees, irrespective of their prior grief counseling experience, are trained through the use of an extensive bereavement manual. There is also an extensive training of spiritual care coordinators whose services are sometimes provided in conjunction with bereavement services. Heartland utilizes a customer service training program called Circle of Care for extensive training of every employee. The program focuses on the ability to talk with patients and families and to identify and resolve conflicts in order to provide the best care possible. Heartland provides an extensive volunteer training program with five levels. The training is tied to the nature of the volunteer jobs that will be performed, such as clerical tasks, administrative help or bereavement assistance. There is also training for volunteers who sit with patients when they are dying as part of a vigil program that ensures patients do not die alone. Licensed professionals may volunteer professional services as well. Heartland volunteers are also involved in music therapy or enrichment programs. The volunteer coordinator works closely with activities directors in nursing homes to ensure that any nursing home resident who desires such therapy receives it, whether the resident is a hospice patient or not. The volunteer program seeks to meet patient and family needs of greatly varied kinds. As but one example, the program could see to it that the lawn at the family home is mowed to relieve the patient and family of that responsibility. In addition to gardeners, the volunteers may meet needs such as those addressed by a beautician or a housekeeper. In sum, the program looks at "the whole picture of . . . needs" (tr. 89), of the patient and family. Applicable rules require that hospices provide a minimum of 5% of direct patient care through volunteers. To that end, Heartland's volunteer training programs incorporate all CHAP and NHPCO standards and practice guidelines. Heartland, moreover, believes that every patient who so desires should receive volunteer assistance. During 2005, Heartland hospice programs nationally provided over 178,000 hours of service by volunteers. Heartland also offers a specialized spiritual care program directed by spiritual care coordinators with extensive training in dealing with bioethical issues, and assisting the hospice care teams with crisis intervention and spiritual needs. The focus is on spirituality, values, beliefs and desires, rather than on religion. Heartland spiritual care coordinators and social workers also lead the Heartland suffering program consistent with Heartland's Sincerus Care philosophy. The spiritual care coordinators develop community plans and work with local and family clergy to coordinate the appropriate care for the patient and family. Heartland's chaplains are often called upon to provide funeral services. Heartland employs social workers for the psychosocial needs of patients and families and to identify community resources beyond hospice services when needed. Social workers also assist with funeral plans and with examining financial eligibility for other types of community service that might be available for the patient and family. Social workers provide suffering assessments and advanced care planning and are instrumental in assisting with coping with chronic disease near the end of life. Heartland's Sincerus Program was developed based on three years of extensive research of then available palliative care programs around the country. Some of the programs focused on specific disease categories, such as cardiac or cancer, and many were designed for a hospital-based delivery. A need for stronger programs when patients returned to their homes, however, was identified. In the course of the development of the Sincerus program, Heartland determined that palliative care tools such as pain management, psychological assistance and help with activities of daily living were beneficial for patients with many non-terminal health conditions as well as those who were dying. Heartland developed clinical pathways that could be employed in both the home health care and hospice divisions of the company. Sincerus Care is Heartland Hospice's program for its palliative care and holistic approach to both hospice and health care at home when the patient has not been admitted to hospice. It addresses unmet patient needs in the areas of psychosocial and spiritual support in this time of rapid advances in medical technology. Heartland's research also determined that hospice patients across the country typically received better pain management than non-hospice patients with chronic diseases. For many years up until the present, there have been millions of Americans with chronic disease. Half of those afflicted with chronic disease had two or more chronic diseases. Not all of those suffering from chronic disease, of course, are in a hospice; the majority, in fact, have not been admitted to hospice. Heartland decided to bring the best practices of hospice to all of its patients, including those with chronic disease in home care programs. It did so through Sincerus Care. Heartland has also developed high quality national palliative care intervention processes. In developing the Sincerus Care approach addressing the body, mind and spirit, a need was identified for the development of a suffering assessment and initiative program. Previously, suffering had not been well researched. Heartland was the first national company to fold suffering assessments and initiatives into all of its programs for home care and hospice. Suffering differs from pain. A person may experience pain without suffering or suffer without physical pain. There are three domains of suffering. One is physical suffering, in which a person has been affected by changes in physical abilities. Concern over body image related to surgeries or amputations is a subset of this domain of suffering. A second is personal family suffering. As the most common, it is related to fears that a patient or family may have about the unknown, including whether they may experience uncontrollable pain. Third, is spiritual suffering. A patient may struggle with values and beliefs as they question why they are here, ask what they may have done wrong to deserve their situation or wonder why they do not believe in God. Four typical vital signs are blood pressure, temperature, pulse, and respiration with pain as a fifth. Heartland's programs use suffering as a sixth vital sign. Heartland's spiritual care coordinators and social workers receive specific additional training on suffering assessment and interventions and techniques to minimize, improve or eliminate suffering as much as possible to improve quality of life. Heartland uses a multifaceted approach to pain management because medication alone is not always sufficient to eliminate or alleviate pain. Heartland also finds it necessary to address aspects of suffering. Heartland's medical directors and physicians review the effectiveness of all the modalities for each patient's pain management to ensure that pain and symptoms are managed effectively. All of Heartland's staff receive specialized pain management training and awareness and sensitivity training. Heartland's social workers, spiritual care coordinators, nurses, home health aides, and other staff also receive extensive training to learn how to deal with issues such as oncology emergencies, care of an Alzheimer's patient, and the particular types of care needed during the last hours of life. Heartland offers extensive community education based on assessment of each community's needs so that community outreach programs are developed to meet those specific community needs for end-of-life care. Many outreach programs have been developed by Heartland for underserved populations and ethnic populations. For example, through one of Heartland's Oklahoma offices, Heartland has a partnership with a Native-American tribe because typically Native Americans have not accessed hospice service as fully as other populations. Heartland uses clinical pathways to follow each patient's care from admission through death to continuously assess suffering, psychological and physical needs and track what has occurred over time with the patient and what has been effective and what has not been effective. At the end of the stay, another assessment is preformed with regard to any changes in the patient's quality of life, whether their pain was successfully managed and whether they died in a place of their choosing. Heartland identifies those patients with the most urgent needs or who are in a fragile state of health to ensure that the staff meets those needs. Heartland developed a "referral quick check" to assist nursing homes and assisted living facilities who requested help in identifying patients who might be in need of hospice services. Heartland also provides a variety of information and brochures to patients, families, and the community for education to explain the nature of hospice care. Heartland employs a multi-tiered quality assessment and assurance program. Quality improvement activities and meetings are held at each local hospice. In addition, quality assessment and assurance committees are used at the regional, division, and company-wide levels so that quality effectiveness is evaluated with respect to quality improvement programs throughout the organization to identify trends locally, regionally, divisionally, and company-wide to identify areas of improvement on a continuing basis. In a number of cities, Heartland operates home health and hospice programs together. Home health involves skilled nursing or physical therapy and serves patients who are able to be rehabilitated, either through therapy or training to reach their maximum optimum level. Often patients who are in home care due to problems such as a broken hip, and are undergoing rehabilitation through physical therapy, also develop or have a terminal prognosis. While in Heartland's home care program, they can be assessed, cared for, and visited by a social worker and a chaplain. The Sincerus Care program that addresses patients where they reside is able to transition patients from home care with rehabilitative types of care to the appropriate levels for terminal care. This transition ability is beneficial for patients. Manor Care has over 65,000 employees and provides Heartland hospice programs with access to corporate support for staff recruitment, including a national contract with an advertising agency which allows freedom for local advertising preferences. The company also has a strong human resources department that assists the local programs with training in hiring practices and with extensive background screening processes to ensure the best employees for their programs. Manor Care provides its subsidiaries and affiliates with many services such as consultants, accounting, financial services, and many other areas of support. Those overhead costs or management fees are annually allocated to various operating entities based on their ability to pay, and therefore would never be applied in a manner to financially harm a new hospice program. Heartland's human resources department provides recruiters to assist with recruiting of administrative and director of nursing positions. Manor Care and Heartland also assist in funding the Job Corp program throughout the United States, which program assists people in obtaining skill sets to obtain jobs in areas such as an LPN or a certified nursing assistant position. Despite a recognized national nursing shortage, Heartland has been able to appropriately staff all of its programs to ensure quality care. Heartland hospice program medical directors are hired from the local community, and may be full-time, part-time, or contracted. Heartland requires all of its medical directors to become board-certified, or to be board-certified in their specialty and to have experience with terminally ill patients and to have an affiliation with a Medicare certified hospital. Heartland desires that all its medical directors be palliative care-certified. If a physician is not, then Heartland provides the education and training. Every Heartland hospice program has at least one medical director. Some have more than one medical director, each of whom supervises specific clinical teams. Heartland's employee retention program includes providing scholarship and tuition reimbursement for nurses, LPNs, and social workers going to school or getting their master's degree, as well as home health aides who desire to become LPNs and RNS. This program also includes persons seeking certification in hospice and palliative care and physician certification for palliative care. The Heartland human resources department is active in each local program, with education and training of staff as part of the employee retention program. In addition to Circle of Care training, the Heartland human resources department also provides leadership and management development training through online courses and educational materials. Heartland has a dedicated team utilized for the implementation of new hospice programs. The team's primary responsibility is to set up each new program location, and includes an administrator, nursing supervisor and office staff who prepare manuals and documentation for use, acquire the furniture and leases, hire the local staff, and assist through the Medicare certification process. The implementation team is expected to function in the same manner with the new Service Area 4A program. Heartland has been very successful with its implementation teams in starting new programs. It is reasonable to expect it to be successful in Service Area 4A as well. Heartland management has met with its affiliated Jacksonville nursing home and rehabilitation clinic directors to discuss methods of providing the best pertinent care for those also in need of hospice care. The administrator of Heartland South-Jacksonville, a nursing home, testified to the current contract with Community, which provides the nursing home residents with quality hospice care, and to the willingness to negotiate a similar contract with Heartland hospice. She supports Heartland's hospice proposal and believes it would be beneficial for patients to have another high quality choice for hospice. She would also assist Heartland's implementation of a hospice program through exiting relationships with local physicians and other health care providers. Vitas Application An experienced provider of hospice services, VITAS is capable of providing in Service Area 4A the core services and related specialized services it provides in Dade, Broward and Palm Beach Counties. As an affiliate, moreover, of VITAS Healthcare Corporation, if its application were to be approved, Vitas would benefit from its affiliation with its parent and its parent’s subsidiaries. Prior to submitting its application, VITAS representatives visited Service Area 4A to assess the market and any potential populations and areas of unmet needs. Mr. Ron Fried, a VITAS senior vice president for development, visited 26 of 32 nursing homes in Duval County, and additional nursing homes in other counties. He also visited with community leaders and organizations. Based on his assessments, he determined there was an unmet need in inner city areas, among nursing home residents and in the African-American community. In addition to Mr. Fried’s on-the-ground survey, VITAS representatives also reviewed the published hospice admission and fixed need pool data, as well as data on deaths and causes of death. They determined there was a large unmet need among the non-cancer patient population. Offers of conditions on hospice programs "are typically rejected" (tr. 502) by AHCA. For state licensure purposes and for federal certification purposes, hospices have to treat any patient who is referred to them or who self- presents. Since hospices, in contrast to hospitals or nursing homes, have no choice in whether to take a patient, AHCA normally will make the comment in the SAAR that it is not necessary to condition an application. While the Hospice Program Rule does not require that an application be conditioned in any way, it nonetheless provides for preferences among competing CON applications as a way to distinguish one competing application from another: Preferences for a New Hospice Program. The agency shall give preference to an applicant meeting one or more of the criteria specified in subparagraphs 1. through 5.: Preference shall be given to an applicant who has a commitment to serve populations with unmet needs. Preference shall be given to an applicant who proposes to provide the inpatient care component of the hospice program through contractual arrangements with existing health care facilities, unless the applicant demonstrates a more cost- efficient alternative. Preference shall be given to an applicant who has a commitment to serve patients who do not have primary caregivers at home; the homeless; and patients with AIDS. In the case of proposals for a hospice SA comprised of three or more counties, preference shall be given to an applicant who has a commitment to establish a physical presence in an underserved county or counties. Preference shall be given to an applicant who proposes to provide services that are not specifically covered by private insurance, Medicaid, or Medicare. Fla. Admin. Code R. 59C-1.0355(4)(e). Despite the lack of necessity for conditions in hospice CON applications and the practice of AHCA in reviewing such applications and commenting on them in SAARs, VITAS offered specific conditions in its application. The purpose of the conditions, by and large, was to demonstrate VITAS' commitment to meet the preferences advanced in Subsection (4)(e) of the Hospice Program Rule. For example, having determined that there was a large unmet need in Service District 4A for the non-cancer population, it conditioned approval of its application on support of a commitment to serve those populations. VITAS conditioned approval of its CON on providing at least 67% of its patient days to non-cancer patients, including a condition for at least 10% of total days to be Alzheimer’s patients. VITAS has demonstrated ability to meet the needs of the non-cancer population. Nationally, hospices have provided one average around 43% of service to non-cancer patients according to the most recent data, while VITAS programs provided 57% of care to non-cancer patients. VITAS has focused significant attention and resources in development of clinical criteria to identify appropriate non-cancer admission, and in education of physicians about the benefits of the hospice for the non-cancer population. While the Florida statewide average for hospice providers is 57.6% non-cancer, VITAS’ programs had 67% non- cancer populations. As Patricia Greenberg, VITAS’ health planning consultant explained, VITAS has established a niche in serving non-cancer patients, including its most recent start up programs in Brevard County with a 69% non-cancer population and Palm Beach County with a 76% non-cancer population. Aside from agreeing to condition its CON on providing 67% of care to non-cancer patients, VITAS’ application projects 274 non-cancer admissions in its second year of operations. VITAS Healthcare Corporation and affiliates have a demonstrated history and commitment to serving large ethnic minority populations in metropolitan markets, including funding of full-time community outreach positions, partnership with the Rainbow Coalition/Operation Push organization, and participation in clergy forums and events aimed at the African-American community in the Jacksonville area. VITAS Healthcare Corporation also “partnered with Duke Institute on Care at the End of Life housed at Duke Divinity School to provide in several areas of the country . . . ministers . . . to learn about end- of-life care issues and how . . . together [to] educate the community to assure access particularly for African Americans to hospice care.” Tr. 627. VITAS specifically conditioned its application on providing a minimum of 15% of its services to Medicaid and charity days, including those Medicaid-designated persons residing in nursing homes. As explained by Mr. Fried, this commitment was made to meet the unmet needs of the underserved inner-city, a largely African-American population with substantial unmet needs. VITAS has a corporate policy of social responsibility and provided over $7 million in charity care in 2004, growing to $8 million in 2005. VITAS proposes to provide the inpatient care component of the hospice program through contractual arrangements with existing health care facilities. Its financial pro formas do not include general inpatient care projections. The reason for the lack of these projections was explained at hearing by Ms. Law. The experience of VITAS the Parent through its affiliates is that with startups through the first two years, the projection is less than one- half percent, which rounded down to zero. Put another way, VITAS expected that its average daily census for inpatient care in its first two years would be less than one patient and therefore the application "did not reflect the revenue or the expense" (tr. 661) associated with inpatient care. There is no question, however, that the VITAS' application is clear that it proposes to provide inpatient care through contractual arrangements. The proposal is supported, despite not being reflected in the financial pro formas, by the experience nationally of VITAS the Parent, "one of the nation's leading providers of [hospice] inpatient care . . . run[ning] about 5% of [total] days of care." Tr. 660. VITAS demonstrated a commitment to serve AIDS patients, the homeless, and patients without primary caregivers at home. VITAS conditioned its CON application on providing 2% of its admissions to AIDS/HIV patients or to serve at least 10% of all AIDS/HIV-related deaths in Service Area 4A. VITAS Healthcare Corporation and its affiliates have demonstrated a commitment to serve such patients; VITAS Healthcare Corporation has even sponsored programs to combat AIDS in sub-Saharan Africa. VITAS' application proposes a physical location in Duval County, but it does not definitely propose a physical presence in any other county (whether underserved or not). While the application is viewed by VITAS as allocating funds for multiple offices, at least a main office in Duval County and a satellite office somewhere in Service Area 4A, Mr. Fried testified that the funds so allocated "might" (tr. 877) support a satellite office in Nassau County but that VITAS "hadn't decided on a precise location. And I don't recall whether that included any satellite space elsewhere in the service area." Tr. 878. VITAS proposes to provide services not specifically covered by private insurance, Medicare or Medicaid, for example, pet therapy, community education and outreach to combat AIDS. VITAS conditioned its application on the implementation of an information technology system known as CarePlanIT. A hand-held, bed-side device, CarePlanIT allows caregivers to perform bed-side entry of notes and orders and to have immediate access to the full range of data stored in the company-wide database known as the VITAS Exchange. CON Review Criteria The Agency found in its SAAR (and continues to maintain) that both applicants generally meet all applicable CON review criteria. It approved Heartland's application and denied VITAS after comparative review that convinced AHCA that Heartland's was superior. Heartland concedes that the “Vitas application generally addresses all applicable CON review criteria.” Heartland Services Inc. And Agency for Health Care Administration Joint Proposed Recommended Order, p. 29. It is joined by CHNF in the contention, however, that compliance with certain CON requirements and review criteria is doubtful and the application information is flawed in a number of respects. VITAS' three opponents in this proceeding, moreover, charge that the VITAS' application is flawed in a manner that may be cause for dismissal under the circumstances of this case: that it does not contain an audited financial statement and therefore does not meet minimum application content requirements. The Agency did not dismiss VITAS' petition; Heartland, nonetheless, maintains that it should be dismissed as the result of the evidence in this proceeding for is failure to meet minimum application content requirements. Application Content Requirements Section 408.037, Florida Statutes (the “Application Content” Statute) governs the content of CON applications. It states, in part, (1) An application for a certificate of need must contain: * * * (c) An audited financial statement of the applicant. In an application submitted by a[] . . . hospice, financial condition documentation must include, but not be limited to, a balance sheet and a profit- and-loss statement of the 2 previous fiscal years’ operation. (Emphasis supplied.) Heartland’s CON application satisfies all of the application content requirements. The application of VITAS does not. VITAS’ application contains audited consolidated financial statements for its parent and for the subsidiaries of VITAS the Parent. It does not contain a separate audited statement of VITAS the Applicant. The presence in the application of a consolidated financial statement of the parent and subsidiaries is not a substitute for the required audited financial statement of the applicant. See Fla. Admin. Code R. 59C-1.008(1)(c): “. . . Nor shall the audited financial statements of the applicant’s parent corporation qualify as an audit of the applicant.” In short, the application fails to contain an audited statement of the VITAS the Applicant and therefore fails to meet minimum content requirements. Although the Application Content Statute is phrased in mandatory terminology (“[a]n application . . . must contain”), VITAS’ failure is not necessarily fatal to its application. The failure to strictly comply with the Application Content Statute may be forgiven by Section 408.039(5)(d), Florida Statutes (the “Forgiveness Statute”) under certain circumstances: The applicant’s failure to strictly comply with the requirements of s. 408.037(1) . . . is not cause for dismissal of the application, unless the failure to comply impairs the fairness of the proceeding or affects the correctness of the action taken by the agency. VITAS maintains that the Forgiveness Statute forgives the application’s lack of an audited financial statement of VITAS the Applicant. The Case for Forgiveness VITAS the Parent does not typically obtain separate audited financial statements for each of its subsidiaries. Instead, independent certified public accountants audit the financial statements of VITAS the Parent and its subsidiaries together in a consolidated fashion. After audit, a consolidated audited financial statement is issued by the independent CPAs. If there is ever a need for a separate audited financial statement of any one of the subsidiaries, according to Lawrence Press, at the time of hearing the controller of VITAS the Parent (see tr. 929), then VITAS commissions an audited financial statement of any “separate legal entity” within the group, id., including VITAS the Applicant. Whether the financial information submitted by VITAS supports the conclusion that the lack in the application of an audited financial statement of the applicant may be forgiven depends on an examination and analysis of the information submitted. It begins with one of the documents attached to Schedule 3 in the application, the consolidated financial statements of VITAS the Parent and its subsidiaries (the "Audited Consolidated Financial Statements." The Audited Consolidated Financial Statements The Audited Consolidated Financial Statements cover two years: the year ended September 30, 2003 (the "2003 Consolidated Audit") and the year ended September 30, 2002 (the "2002 Consolidated Audit.") See VITAS’ Certificate of Need Application, Vol. 1 of 4, Tab 3. The Audited Consolidated Financial Statements contain two reports each entitled, “Report of Certified Public Accountants,” one for the 2003 Consolidated Audit, the second for the 2002 Consolidated Audit. The first report is dated November 10, 2003; the second report is dated November 8, 2002. The first report concludes: In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated position of Vitas Healthcare Corporation and Subsidiaries at September 30, 2003 and 2002, and the results of their operations and cash flows for each of the three years in the period ended September 30, 2003, in conformity with accounting principles generally accepted in the United States. VITAS Certificate of Need Application, Vol. 1 of 4, Tab 3, p. 1 of the 2003 Consolidated Audit.2 Following the first report are the consolidated financial statements themselves. These are listed in the Table of Contents as follows: Consolidated Financial Statements; Consolidated Balance Sheets at September 30, 2003 and 2002; Consolidated Statements of Income for the years ended September 30, 2003, 2002 and 2001; Consolidated Statements of Changes in Redeemable Preferred Stock and Stockholders Deficit for the years ended September 30, 2003, 2002, 2001; Consolidated Statements of Cash Flows for the years ended September 30, 2003, 2002 and 2001; and Notes to Consolidated Financial Statements. See VITAS Certificate of Need Application, Vol. 1 of 4, Tab 3, Contents, Consolidated Financial Statements, September 30, 2003. The second report contains an identical opinion, except for a change in dates to reflect that the statements are for the statement year ending in 2002 rather than 2003. The second report also contains a paragraph that does not appear in the first report: Our audits were conducted for the purpose of forming an opinion on the financial statements taken as a whole. The supplemental balance sheets as of September 30, 2002 and 2001, and statements of income for the years then ended which include Vitas Healthcare Corporation, Vitas Healthcare Corporation of Florida, . . . [and a number of other VITAS Healthcare Corporation Subsidiaries] are presented for the purpose of additional analysis and are not a required part of the financial statements of Vitas Healthcare Corporation and Subsidiaries. Such information has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, are fairly stated in all material respects in relation to the financial statements taken as a whole. VITAS Certificate of Need Application, Vol. 1 of 4, Tab 3, p. 1 of the September 30, 2002, Consolidated Financial Statements. Following the second report are consolidated financial statements of the same type as those following the first report, that is, detailed balance sheets, detailed statements of income, detailed statements of changes in redeemable preferred stock and stockholders deficit, detailed statements of cash flows, and notes. Unlike the information that follows the first report, however, there is other information listed in the Table of Contents for the 2002 Consolidated Audit. It is denominated “Other Financial Information.” The Other Financial Information is described in the Contents page of the Consolidated Financial Statements for September 30, 2002, as “Supplemental Balance Sheets at September 31 [sic], 2002 and 2001” and “Supplemental Statements of Income for the years ended September 31 [sic], 2002 and 2001.” It is this information that is “presented for additional analysis” as reported in the paragraph that appears in the 2002 report that is not present in the 2003 report. This is also the information that is reported in the same paragraph to have been subject to the auditing procedures applied in the Ernst & Young audits and found, in Ernst & Young’s opinion, to be fairly stated. The financial information attached to Schedule 3 in VITAS’ application also contains another set of documents. These documents are not a part of the Audited Consolidated Financial Statements. Nor, accordingly, were they reviewed by Ernst & Young. They consist of three pages. The first page is a letter from Robin Johnson, CPA, that identifies her as vice president and controller of VITAS Healthcare Corporation. The letter is dated June 25, 2004 (the “Johnson Letter.”) Attached to the Johnson Letter are two pages. The first page is entitled, “Vitas Healthcare Corporation and Subsidiaries Consolidated Balance Sheets.” The second page is entitled, “Vitas Healthcare Corporation and Subsidiaries Consolidated Statements of Income.” The Johnson Letter refers to these pages as "[t]he . . . supplemental balance sheets as of September 30, 2003 and 2002 [2003 information] and the statements of income for the years then ended . . . ." Each of these two pages (the “Johnson Supplemental Balance Sheets and Statement of Income” or the "Johnson Supplemental Financial Information") contains 13 columns; the first column devoted to “CONSOLIDATED VITAS,” the next twelve devoted to one of each of twelve subsidiaries. Of the 13 columns on each page, one column is devoted to financial information that pertains solely to “VITAS OF FLORIDA” or VITAS the Applicant. The Johnson Letter and the Johnson Supplemental Financial Information were not audited by Ernst & Young or any other independent certified public accountant. Nonetheless, they appear in the VITAS application within the body of the Audited Consolidated Financial Statements. Mr. Beiseigle described them at hearing: “[T]hat information that’s sandwiched between the 2002 and 2003 audits of VITAS Healthcare Corporation.” Tr. 1701. Mr. Beiseigle’s description was quickly followed by a clarification from CHNF’s counsel, Mr. Newell: “He means physically in the book, not necessarily chronologically.” Id. Mr. Newell's clarifying comment is confirmed by an examination of the application in evidence. Indeed, Mr. Beiseigle's description is accurate; the Johnson Letter and the Johnson Supplemental Financial Information is "sandwiched" between the 2003 Consolidated Audit and the 2002 Consolidated Audit. It appears in the midst of the Audited Consolidated Financial Statements, despite the fact that it is information that was not audited by Ernst & Young and not audited by any other independent certified public accountant. The insertion of the Johnson Letter and Supplemental Balance Sheets and Statements of Income into the VITAS application in the midst of the Audited Consolidated Financial Statements was explained by VITAS through the testimony of Mr. Press, VITAS' controller at the time of hearing, and Ms. Greenberg, the primary author of the application who was responsible for compiling all four volumes of the application in their entirety. See Tr. 996. The Insertion of the Johnson Information VITAS attempted to commission an audited financial statement of VITAS the Applicant standing alone. As Mr. Press testified, such an attempt would be in due course whenever there was a need for a separate audit of any of the individual VITAS subsidiaries. An example of a case of such a need is this one, when a CON application must contain an audited financial statement of the applicant. VITAS representatives, therefore, asked Ernst & Young to audit financial statements of VITAS the Applicant separately from the consolidated review it had conducted. VITAS' request of Ernst & Young followed the audit of the Consolidated Financial Statements and was also made in the wake of ChemEd’s acquisition of VITAS the Parent. After the acquisition, ChemEd informed Ernst & Young that its responsibilities with regard to VITAS the Parent and its subsidiaries would be assumed by ChemEd’s accountants, PriceWaterhouse. Ernst & Young, therefore, declined the request by VITAS for an independent separate audit. There is nothing of record to show that VITAS attempted to obtain either an exception from ChemEd to allow Ernst & Young to proceed with a separate audit or to show that VITAS attempted to obtain an audit of itself from PriceWaterhouse or some other certified public accountant firm besides Ernst & Young. VITAS was aware that its application would lack minimum content without an “audited financial statement of the applicant.” It attempted to cure its non-compliance with the statutory requirement by insertion into the application of the Johnson Letter and Johnson Supplemental Financial Information. VITAS had no illusions that the information would constitute an audited financial statement of the applicant. It knew the information had been generated internally and constituted "managerial accounting" rather than "financial accounting." It knew the information had not been audited externally by an independent certified public accountant. In introduction of the Supplemental Information, the Johnson Letter reads, in part: VITAS Healthcare Corporation audits were conducted for the purpose of forming an opinion on the financial statements of Vitas Healthcare Corporation and Subsidiaries taken as a whole. The enclosed supplemental balance sheets as of September 30, 2003 and 2002, and the statements of income for years then ended which include . . . Vitas Healthcare Corporation of Florida . . . are presented for the purpose of additional analysis and are not a required part of the financial statements of VITAS Healthcare Corporation and Subsidiaries. Such information has been subjected to the auditing procedures applied in the audits of the financial statements and are fairly stated in all material respects in relation to the financial statements of VITAS Healthcare Corporation and Subsidiaries … taken as a whole. VITAS CON Application 9784, Vol. 1 of 4, Tab 3 (no page no., emphasis supplied). The language in the Johnson Letter underscored above makes two claims paraphrased as follows: first, the balance sheets and statements of income have been subjected to the auditing procedures applied by Ernst & Young in the consolidated audit; second, the information in the balance sheets and statements of income is fairly stated in all material respects in relation to the Audited Consolidated Financial Statements. It appears that the language of the letter, quoted above, was selected because it mirrors the language used by Ernst & Young to describe the “Other Financial Information” attached to the Ernst & Young 2002 consolidated audit. Whether that was why the language was selected or not, the inclusion in the letter was the subject of sharp criticism, see tr. 421-423, by Steven Jones, a licensed certified public accountant in Florida and Heartland's expert in accounting and healthcare finance. He found the language contrary to provisions of the American Institute of Certified Public Accountants, provisions of the Florida Statutes and the Florida Administrative Code, and generally accepted auditing standards that address "independence, integrity and objectivity." See Tr. 421-23. Whatever the motivation for including the two claims in the Johnson Letter, Ms. Johnson was not acting as an independent auditor. Nor could she have been so acting. Although a certified public accountant, as the controller of VITAS Healthcare Corporation, Ms. Johnson is quite the opposite of “independent” when it comes to VITAS the Parent and its subsidiaries, including the applicant in this case. Thus the Johnson Letter cannot stand for the claim made within it that Johnson Supplemental Financial Information had been subject to the same auditing procedures as the information subject to the consolidated review. Any light that Ms. Johnson might have shed on the claims in the letter did not materialize. Ms. Johnson did not testify at hearing. The task of proving compliance with the statutory requirement or how lack of strict compliance could be forgiven fell to Mr. Press and Ms. Greenberg. To the credit of both Mr. Press and Ms. Greenberg, neither claimed that the Johnson Letter and Johnson Supplemental Information constituted audited financial statements. As Ms. Greenberg stated in cross- examination by Mr. Newell at hearing: Q. But there is a difference . . . between the Letter that accompanies the . . . audits by Ernst & Young . . . and this letter [Ms. Johnson’s letter] . . . Now Ernst & Young did that in 2002, but based on your request and Ms. Johnson’s willingness, she certified that this time, but she was not one of the independent auditors, was she? A. No, her role was to work with them and provide them with the financial statements, but she was not an independent auditor. * * * Q. Would you agree with me perhaps that one who uses language like that in the bottom of Ms. Johnson’s letter, which is essentially identical to what external auditors used in the 2002 letter, might be the use of language in a manner that is to imply that a CPA is acting as independent certified public accountant in the audit of the attached statements. A. I don’t understand the question. Ms. Johnson is a CPA and controller and she was providing that language. We’ll make sure – she was not an external auditor, was she? A. No, I think I already said that. Tr. 1130, 1132, 1133. Although Ms. Johnson’s letter does not raise the supplemental information to the level of a financial statement audited by an independent certified public accountant, VITAS presented evidence as to why the failure to file an audited financial statement of the applicant does not impair the fairness of the proceeding or would not impair the correctness of approving VITAS’ application should AHCA do so. For example, all of the data on the balance sheets and income statements for subsidiary corporations tie to the consolidated totals for VITAS Healthcare Corporation as a whole. The statements reveal that on a consolidated basis the company had over $13 million in net income in 2003. VITAS Healthcare Corporation of Florida supplies the majority of revenue and net income to VITAS Healthcare Corporation. In fact, it makes up for losses by other subsidiaries. Ms. Greenberg opined that, as a financial analyst, she could determine ability to fund the project from the financial information supplied in the CON application. First, the $200,000 startup cost is minimal. Second, all of the supplemental information ties back to the audited consolidated financial statements. Mr. Press made this point, too. Ms. Greenberg determined, moreover, that VITAS Healthcare Corporation of Florida has available to it $14.3 million in current assets, $14.9 million in total assets, $51 million in retained earnings, and over $29 million in net income. Quite clearly, in her view, there are adequate funds available to fund the program of VITAS the Applicant in Service Area 4A. In addition, Ms. Greenberg noted that the proposed method of funding is from future cash flows and is not based on historic information. The application includes a forecast of financial operations of VITAS Healthcare Corporation with and without approval of the proposed project. Under a conservative scenario, VITAS is expected to net over $26 million in income, an amount more than sufficient to fund a $200,000 project. Ms. Greenberg’s analysis was subject to criticism by Mr. Beiseigel, CHNF’s expert health care financial analyst and forensic financial analyst. His analysis began with appreciation of the import of the lack of an audited financial statement of the applicant. The analysis requires an understanding of the elements of an audited financial statement. Elements and Import of an Audited Financial Statement The elements of an independently audited financial statement include an audit opinion letter, a detailed balance sheet, detailed income statement, detailed statement of changes in owner’s or stockholder’s position, a detailed operating cash flow statement and detailed notes allowing a financial reviewer to determine the existence of contingent liabilities and the materiality of the financial statements. These elements are all present in the Ernst & Young Audited Consolidated Financial Statements. The import of the lack of an audited financial statement of VITAS the Applicant and the presence of the Johnson Letter and Johnson Supplemental Financial Information to cover the year ending September of 2003 in this case is obvious. All of the elements of an independently audited financial statement are not subject to review by financial analysts such as those employed by AHCA and analysts outside AHCA (Mr. Beiseigel, for example) who might have reviewed the independently audited financial statement for purposes of a contested proceeding at DOAH, as is the case here. The Johnson Information that pertains to VITAS the Applicant was criticized in more detail on another basis: it does not contain any cash flow statements. Cash Flow Statements The Johnson Supplemental Financial Information does not include cash flow statements. In the SAAR, the Agency observed that cash flow data were not included in the application when it discussed compliance with Section 408.035(4), Florida Statutes, that is, what funds for capital and operating expenditures are available for project accomplishment and operation. Nonetheless, the SAAR concluded: Although the applicant [VITAS] did not provide historic cash flow data, the applicant showed healthy earnings. Even under the conservative analysis, the applicant has $6 million in working capital. Therefore, funding for this project and all capital projects should be available as needed. Heartland 16, p. 64. As part of its case that the failure to include an audited financial statement of the applicant should be forgiven, and that it was not necessary for it to provide cash flow data, VITAS points to the language that follows the statutory requirement that an application contain an audited financial statement: In an application submitted by a[] hospice, financial documentation must include, but need not be limited to, a balance sheet and a profit-and-loss statement of the previous 2 years’ operation. § 408.037(1)(c), Fla. Stat. VITAS submitted balance sheets and income statements for 2003, albeit not audited. Furthermore, Ms. Greenberg's point that the information provided to AHCA in the application demonstrates that VITAS the Applicant clearly has the financial wherewithal to fund the start-up costs associated with the application, costs that are minimal was adopted, in essence, by AHCA in the SAAR. Nonetheless, at hearing, AHCA supported Heartland and CHNF's argument that the lack of an audited financial statement in VITAS’ application is a material point to be considered in this proceeding when it comes to comparative review. The Agency has never excused the lack of an audited financial statement of an applicant. Furthermore, Mr. Gregg testified that in a comparative review proceeding where one applicant provides an audited financial statement and another does not, to not take into consideration that one application was missing the required audit would impact the fairness of the proceeding: I would say that it impacts the fairness to the extent that it prevents us from comparing apples to apples. A completely audited financial statement is generally more reliable and . . . has been viewed by a CPA who is not typically involved with the organization, and the other [an internally generated management report] is less . . . reliable. Tr. 512. As Mr. Gregg further testified in the context of comparative review, “I would say that there were uncertainties in the financial information that we got from VITAS. And we were more comfortable with the level of certainty of the financial information that we had from Heartland.” Tr. 506. Thus, while AHCA did not dismiss VITAS’ application for failure to meet minimum content requirements, it took into consideration the missing audit as it reviewed Heartland and VITAS’ applications on a comparative basis after determining that the two applicants generally meet the statutory and rule criteria for approving a CON application. CON Review Criteria Heartland demonstrated that it meets the statutory and review criteria for approval. To do so, Heartland had to correct an error in the Heartland application that related to long-term financial feasibility. The application had assumed that continuous care patient days would amount to approximately 7% of total patient days for both Year One and Year Two. The assumption was made after looking at national data in which continuous care is presented in terms of hours while other patient service types are presented in terms of days. The assumption was criticized by VITAS' witnesses. The criticism was discovered before hearing by Heartland. Mr. Jones realized the mistake, and therefore "recast those relative ratios, using a normal range for a continuous day, [so that] the percentage of continuous care produce[d] [is] substantially around 1 percent," tr. 412-13, an accurate percentage of continuous care for hospice programs. Mr. Jones also re-cast the pro formas to assume that continuous care should be reimbursed only at 15 hours per day rather than 24 hours per day (as the application had done) in response to another valid criticism by VITAS. VITAS moved to strike any testimony or evidence that concerned the re-casting on the basis that it is an impermissible amendment to Heartland's application. Ms. Greenberg also opined that Heartland projected salaries for some FTE positions were too low. Mr. Jones testified otherwise: that the salary estimates are generally reasonable. Ms. Greenberg also criticized the Heartland application based on an assertion that the projections did not reflect an additional 5% expense per patient day ("PPD") for dual eligible Medicare/Medicaid patients who reside in nursing homes. For nursing home residents who elect hospice admission, the state no longer pays the nursing home its Medicaid room and board rate, but rather pays a geographic area average rate to the hospice, which on average is about 95% of the rate previously paid to the nursing home. Even though it is negotiable, hospices often pay the nursing home its normal rate, resulting in a hospice expense of about 5% PPD more than the hospice is reimbursed for room and board. Five percent of the average nursing home room and board rate in the Jacksonville area would equal approximately $7.50 PPD. Statewide, about 30% of nursing home patient days for hospice care is delivered to Medicaid dually eligible nursing home residents. In the face of the criticism, Heartland demonstrated at hearing that its proposal is financially feasible in the long term, even if it were assumed: that Ms. Greenberg is correct about the salaries; that continuous care days should be 1% rather than 7% and reimbursed at only 15 hours per day instead of 24 hours per day; and, that the revenue for Medicaid nursing facility residents should be reduced at a rate of 5% PPD. This demonstration was conducted by Mr. Jones in what he described as a "worst case scenario" analysis. The analysis used a model that reduced continuous care revenue and shifted the reduced days to routine care; correspondingly adjusted the staffing levels to the Heartland standard; accounted for the 5% PPD Medicaid nursing home resident differential; and increased salary expenses. The re-casting is reflected in Heartland Exhibit 15, a recast of Schedules 6, 7, and 8 in its CON application. The re-casting results in a projected loss in Year One, but a projected profit in Year Two of $88,596, a demonstration of long term financial feasibility. The adjustments reflected in Heartland Exhibit 15, moreover, do not reflect every adjustment that would have to be made to fully recast the entire financial projections. If other expenses that would be reduced, such as drug costs and medical supplies, by a full recasting were included, the profit projected for Year Two would higher than the $88,596 reflected in the exhibit. In CON application proceedings, short-term financial feasibility is typically considered as the ability to fund the projected costs reflected on Schedule 1 of the application and to provide sufficient working capital for a start-up period. Heartland's application demonstrates short term financial feasibility. Because the applicant is a company in the development stage, it obtained a funding commitment from Manor Care to meet its funding needs. The application contained Manor Care's audited financial statements demonstrating the ability to fund its commitment in addition to an audited financial statement of the applicant as required. Manor Care is committed to providing all necessary funding and working capital requirements to Heartland to establish and operate the proposed hospice. Manor Care has the financial resources to fund the project. If needed, Manor Care also has approximately $230 million of unused debt capacity. It can clearly fund the $294,000 needed for the project. Manor Care, moreover, consistent with its policy with other subsidiaries, will not charge Heartland any interest on funds it provides for capital or operating expenses. If the CON is approved, Manor Care is committed to moving forward with the development of the hospice program. Neither Manor Care nor any of its affiliates has ever received a CON to develop a hospice in any state and not proceeded with development. Testimony at trial bolstered the Agency's conclusion in its SAAR that VITAS, despite the missing audited financial statement of VITAS the Applicant, should be able to fund the hospice program it proposes for Service Area 4A in the short term. The financial information supplied by VITAS, however, because of the lack of an audited financial statement of the applicant, was not as certain as that of Heartland, a matter that was determinative in the Agency's comparative review of the two applications. Comparative Review The financial information in Heartland's application was more certain than the financial information in the application of VITAS. Since Heartland provided an "audited financial statement of the applicant" and VITAS did not, Heartland must be viewed as providing a greater level of certitude about its financial position. The Agency opined that there is a second factor that makes Heartland's application superior. Currently, there are hospice programs operated either by VITAS the Applicant or affiliated with VITAS the Parent in Service Areas 11 (Dade and Monroe Counties), 10 (Broward County), 9C (Palm Beach County), 7A (Brevard County), 7B (Flagler and Volusia Counties), and 7C (Orange County.) Hospice programs affiliated with VITAS the Parent now serve the eastern coast of Florida from Key West to the service area adjacent to Service Area 4A in the northeast corner of the state and inland covering the most populous area of Central Florida. The introduction of Heartland, a nationally recognized quality hospice provider, into Florida will foster competition that, in AHCA's view, will benefit patients and families through providing a choice in hospice care.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Agency for Health Care Administration approve CON Application 9783 filed by Heartland Services of Florida, Inc., and deny CON Application 9784 filed by Vitas Healthcare Corporation of Florida. DONE AND ENTERED this 18th day of October, 2006, in Tallahassee, Leon County, Florida. S DAVID M. MALONEY 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 18th day of October, 2006.
The Issue Whether the Certificate of Need (CON) applications filed by Regency Hospice of Northwest Florida, Inc. (Regency), Odyssey Healthcare of Northwest Florida, Inc. (Odyssey), and United Hospice of West Florida, Inc. (United) for a new hospice program in Agency for Health Care Administration (AHCA or the Agency) Service Area (Service Area) 1, satisfy, on balance, the applicable statutory and rule review criteria sufficiently to warrant approval and, if so, which of the three applications best meets the applicable criteria for approval.
Findings Of Fact The Parties AHCA The Agency for Health Care Administration is the state agency authorized to evaluate and render final determinations on CON applications pursuant to Section 408.034(1) Florida Statutes.1 Regency Regency Hospice of Northwest Florida, Inc. (Regency) is a for-profit, wholly-owned subsidiary of Regency Healthcare Group, LLC (RHG). Regency is a start-up corporation formed for the purpose of owning and operating a new hospice program in Service Area 1. (Findings relating to the creation of Regency and Regency Hospice of Northwest Florida, LLC (Regency LLC) are set forth in section III.) RHG was formed in 2005 for the purpose of acquiring and then owning and operating hospice operations in the southeastern United States. The company's sole business is providing hospice services. In February 2006, RHG acquired the hospice operations of Regency Hospice with locations in Georgia and South Carolina. In June 2006, RHG acquired New Beacon Hospice with multiple locations in Alabama. In addition to these acquisitions, RHG opened a new Medicare licensed hospice program in Augusta, Georgia, and also opened two additional satellite offices in Gainesville, Georgia, and Gadsden, Alabama. RHG operates under the "Regency" brand name in Georgia and South Carolina (seven hospice offices) through its wholly- owned subsidiary Regency Hospice of Georgia, LLC, and operates under the "New Beacon" brand name in Alabama (eights hospice offices) through its wholly-owned subsidiary New Beacon Healthcare Group, LLC. Presently, RHG owns and operates ten Medicare certified hospice programs at 15 office locations: eight in Alabama, four in Georgia, and three in South Carolina. The offices are located in urban and rural settings. If approved in Florida, RHG would operate the hospice through the wholly-owned subsidiary Regency Hospice of Northwest Florida, Inc. There is no separate corporate management of Regency at the subsidiary level. The supervision, management, and control of all of the RHG hospice operations, whether operating under the Regency or New Beacon brand name, are centralized in the senior management team of RHG located in Birmingham, Alabama. The mission, core values, service standards, operating practices, protocols and policies are uniform throughout the company regardless whether a hospice program is operated under the New Beacon or Regency brand name. RHG senior management team has demonstrated a history of developing successful hospice operations. The origin of Regency's New Beacon hospice operations in Alabama dates back approximately 25 years when the hospice was first established in Birmingham, Alabama. The Birmingham hospice was initially owned by the Baptist Health System as a department of Montclair Hospital. Over time, the Baptist Hospice expanded its operations through acquisitions and opening of new programs in locations outside of Birmingham. Eventually, Baptist-owned hospice operations merged with the hospice operations of the Catholic health system in 1997. The joint Baptist/Catholic venture was operated under the name of Unity Health Services changing its name to New Beacon in 2001. In 2006, the Baptist and Catholic health systems decided to sell their hospice operations in Alabama. Both Odyssey and Regency submitted bids to purchase the New Beacon operations. Although Odyssey was the highest bidder, the hospice program was sold to Regency, apparently because RHG shared New Beacon's philosophy regarding providing hospice care. The Baptist and Catholic health systems continue to have a minority ownership in Regency and share a seat on the seven-member board of directors. RHG's hospice operations have grown in terms of patient admissions and average daily census since the acquisition of Regency and New Beacon. RHG plans to focus efforts in the southeast and expand into southern Alabama and the Florida panhandle. RHG's present plans are to open from three to ten new hospice locations in 2008 including the three Florida panhandle locations at issue in this case if approved. New Beacon is a recognized provider of choice in Alabama for some health care providers and its operations have been successful. RHG's operations in Georgia and South Carolina have also been successful. Under RHG's management and prior to its acquisition, New Beacon has afforded high quality of care to the patients its served. There are numerous examples of highly complex, difficult, and costly patients that New Beacon has accepted both before and after the acquisition. There have been no apparent changes in New Beacon's direction or philosophy since acquisition by RHG. Some witnesses who testified on behalf of Regency, expressed a preference for New Beacon over Odyssey based on ease of referrals and complexity of care of patients New Beacon accepts. Odyssey Odyssey Healthcare of Northwest Florida, Inc. (Odyssey) is a for-profit, wholly-owned subsidiary of Odyssey Healthcare, Inc. (Odyssey Healthcare). Odyssey is a start-up corporation formed for the purpose of filing a CON application at issue in this proceeding and owning and operating a new hospice program in Service Area 1. Odyssey Healthcare is a publicly-traded company founded in 1996 and focuses on caring for patients at end-of-life care. Odyssey Healthcare's sole line of business is hospice services. Since 1996, Odyssey Healthcare has started up and acquired more than 80 hospice programs in 30 states. Odyssey Healthcare presently operates approximately 76 Medicare certified hospice programs, including the operation of two hospice programs in Florida. Odyssey Healthcare has approximately 5,000 employees through affiliated programs and serves approximately 8,000 patients per day across its 76 hospice programs and serves has approximately 34,000 admissions in a 12-month period. Last year, Odyssey Healthcare started five or six new hospice programs. Odyssey is the only one of the three co-batched applicants with start-up and operational hospice experience in Florida - in AHCA Service Areas 4 and 11. Since 2003, Odyssey Healthcare has started up approximately 40 new hospice programs, but over the past several years, Odyssey Healthcare has closed or sold seven programs as underperforming or, in some cases, in light of unfavorable market conditions. Odyssey Healthcare has not sold or closed other hospice programs, such as those located in New Orleans and Baton Rouge, Louisiana, following the hurricane, or in Boston, Massachusetts, notwithstanding the loss of money in those markets or other market conditions. Odyssey Healthcare's patient population consists of approximately 68 percent non-cancer and 32 percent cancer patients. Odyssey Healthcare was the subject of an investigation by the United States Department of Justice (DOJ) that ultimately resulted in a settlement and the payment of $13 million to the federal government in July 2006. The settlement did not involve the admission of liability or acknowledgement of wrongdoing. As part of the settlement with the United States Department of Health and Human Services, Office of Inspector General, Odyssey Healthcare entered into a corporate integrity agreement (CIA) for five years. Ody 4 at 32. According to Odyssey Healthcare, the federal investigation allowed Odyssey Healthcare to self- audit to ensure compliance with the Medicare conditions for participation followed by an outside verification agency. The federal investigation was not related to quality of care issues. Medicare CAP problems result from longer patient stays that are not balanced by shorter patient stays, thus leading to increased overall revenue per patient. Medicare CAP limitations have been a problem for the hospice industry at large because they place a ceiling on the overall Medicare revenue per patient that a hospice may receive. Odyssey Healthcare's Medicare CAP liability increased from approximately 2 million dollars in 2004 to approximately 12 million dollars in 2005 to approximately 16 million dollars in 2006, but lower in 2007. Odyssey Healthcare has plans in place to reduce its Medicare CAP exposure that may have negative short-term affects. Odyssey Healthcare's net income declined significantly from 2004 to 2006. The decline is due in part to Medicare CAP limitations. Regency has had one cap repayment ($670,000, T 201) and United has had none. United United Hospice of West Florida, Inc. (United) is a wholly-owned subsidiary of United Hospice, Inc. (UH), which, in turn, is a wholly-owned subsidiary of United Health Services, Inc. (UHS) commonly known as UHS-Pruitt. UH is an existing provider of hospice services in Georgia, South Carolina, and North Carolina. UHS has also established a not-for-profit foundation, which offers the public and professional community information and assistance regarding end of life care and planning. UHS-Pruitt was founded in 1969 as a nursing home company and has expanded to become a comprehensive long-term care provider in Georgia, South Carolina, North Carolina, and Florida. UHS-Pruitt provides several services including nursing homes, hospices, assisted living facilities, pharmacy services, medical supplies, durable medical equipment, outpatient rehabilitation, adult day care, and home health services. UHS-Pruitt currently has a 120-bed skilled nursing facility (Santa Rosa Heritage, operated by United Hospice, Inc.), pharmacy services, rehabilitation office (including therapy programs), durable medical equipment, located in Milton, Santa Rosa County, Florida. UHS-Pruitt has approximately 8,000 employees in all of its programs. The main focus of United Hospice, Inc. and UHS-Pruitt has been the nursing home business, with additional product lines developed as an adjunct to the delivery of nursing home services as noted herein. United Hospice Foundation was established to educate individuals about hospice services and end-of-life decision making. The foundation provides training and educational programs to both the professional and the lay community regarding these subjects. The foundation is operated independently from the for-profit portions of UHS-Pruitt. UHS-Pruitt by and through United Hospice, Inc. for the most began providing hospice services in 1993 and offers hospice programs in approximately 13 to 20 locations in Georgia, North Carolina, and South Carolina, with the vast majority of the programs in Georgia. The hospice programs were start-up programs, not acquisitions. There is evidence that approximately 40 to 42 percent of United Hospice, Inc.'s hospice patients reside in company owned nursing homes. United Hospice, Inc. opened one or more new hospice program each year during the past several years and is internally discussing three new hospices "[t]hrough pure development, as opposed to acquisition." Overview of Hospice Services In Florida, a hospice program is required to provide a continuum of palliative and supportive care for terminally ill patients and their family. A terminally ill patient has a medical prognosis that his or her life expectancy is one year or less if the illness runs its normal course. §§ 400.601(3) and (8), Fla. Stat. Under the Medicare program administered by the federal government, a terminally ill patient is a person who has a life expectancy of six months or less. Hospice services must be available 24 hours a day, 7 days a week, and must include certain core services, such as nursing services, social work services, pastoral or counseling services, dietary counseling, and bereavement counseling services. Physician services may be provided by the hospice directly or through contract. § 400.609(1)(a), Fla. Stat. Hospice care and services provided in a private home shall be the primary form of care. Hospice care and services may be provided by the hospice to a patient living in an assisted living facility, adult family-care home, nursing home, hospice residential unit or facility, or other non-domestic place of permanent or temporary residence. The inpatient component of care is a short-term adjunct to hospice home care and hospice residential care and shall be used only for pain control, symptom management, or respite care. The hospice bereavement program must be a comprehensive program, under professional supervision, that provides a continuum of formal and informal support of services to the family for a minimum of one year after the patient's death. §§ 400.609(1)- (5), Fla. Stat. The goal of hospice is to provide physical, emotional, psychological, and spiritual comfort and support to a dying patient and their family. Hospice care provides palliative care as opposed to curative care, with the focus of treatment centering on palliative care and comfort measures. Hospice care is provided pursuant to a plan of care that is developed by an interdisciplinary team consisting of, e.g., physicians, nurses, social workers, counselors, including chaplains. There are four levels of service of hospice care: routine home care, continuous care, general inpatient care, and respite care. Generally, hospice routine home care is the vast majority of patient days and respite care is typically a very minor percentage of days. Continuous care is basically emergency room type or crisis care that can be provided in a home care setting or in any setting where the patient resides. Continuous care is provided for short amounts of time usually when symptoms become severe and skilled and individual interventions are needed for pain and symptom management. The inpatient level of care provides the intensive level of care within a hospital setting, a skilled nursing unit, or in a free-standing hospice inpatient unit. Respite care is generally designed for caregiver relief. Medicare reimburses different levels of care at different rates. Approximately 85 to 90 percent of hospice care is Medicare related. There are certain services required by specific patients that are not necessarily covered by Medicare and/or private or commercial insurance. These services may include music therapy, pet therapy, art therapy, massage therapy, and aromatherapy. There are other more complicated and expensive non-covered services such as palliative chemotherapy and radiation that may be indicated for severe pain control and symptom control. Each applicant proposes to provide hospice patients with the all of the core services and many of the other services mentioned above. However, there are several distinctions among the applicants which are discussed later. Regency's LOI and CON Application Prior to the final hearing, Odyssey and United filed separate motions requesting entry of an order dismissing Regency's petition and CON application. Odyssey and United argue that Regency Hospice of Northwest Florida, LLC's initial LOI and shell CON application were defective because only a corporation, not a limited liability company, authorized to do business in Florida on the date these documents were filed, can be a viable applicant to provide hospice services in Florida. As a result, the Agency should have rejected the LOI and shell CON application because Regency LLC was not an existing corporation on the date the LOI and shell CON application were filed contrary to Florida law. The following findings of fact relate to this issue. On November 2, 2006, Regency Hospice of Northwest Florida, LLC was formed as a Delaware limited liability company for the purpose of pursuing approval of a CON to provide for a new hospice program in Florida. (Regency LLC was 100 percent owned by RHG and did not differ in structure from Regency, except for the difference in entity status.) On November 3, 2006, the Florida Secretary of State certified that Regency LLC was properly registered to conduct business in Florida on November 3, 2006. In October 2006, Odyssey and United filed separate LOIs. By Agency rule, these filings created a grace period for filing additional LOIs. During the grace period, on November 7, 2006, Regency LLC filed a LOI to establish a new hospice program in Service Area 1. On November 9, 2006, the Agency issued a letter to Regency LLC, accepting the LOI. On November 22, 2006, Regency LLC filed its initial shell application with the Agency. The initial CON application consisted of two pages. Reg 7; T 118. Thereafter, Odyssey advised the Agency that Regency LLC's CON application should be withdrawn from further consideration because the applicant entity, Regency LLC, was not a corporation under Florida law, but was instead a limited liability company. On November 28, 2006, the Agency notified Regency LLC that it was withdrawing Regency LLC's CON application for consideration on the basis that Regency LLC was a limited liability company, rather than a corporation. On November 29, 2006, a certificate of incorporation was filed on behalf of Regency Hospice of Northwest Florida, Inc., with the State of Delaware. A certificate of conversion was filed converting the limited liability company to a corporation, i.e., Regency Hospice of Northwest Florida, LLC to Regency Hospice of Northwest Florida, Inc. On December 5, 2006, a certificate of conversion and articles of incorporation were filed on behalf of Regency Hospice of Northwest Florida, Inc. with the Florida Secretary of State. The Florida Secretary of State issued a document stating in part: "The Certificate of Conversion and Articles of Incorporation were filed December 5, 2006, with an organizational date deemed effective November 2, 2006, for REGENCY HOSPICE OF NORTHWEST FLORIDA, INC., the resulting Florida corporation." On October 24, 2007, the Florida Secretary of State certified that Regency Hospice of Northwest Florida, Inc. "is a corporation organized under the laws of the State of Florida, filed on December 5, 2006, effective November 2, 2006." (emphasis added). On December 11, 2006, Regency Hospice of Northwest Florida, Inc., filed a formal petition (by letter) requesting a hearing in connection with the Agency's prior notice indicating withdrawal of the CON application. On or about December 21, 2006, a settlement agreement was reached among representatives of the Agency and Regency Hospice of Northwest Florida, LLC and "now known as" Regency Hospice of Northwest Florida, Inc. The Agency agreed to accept a timely filed and complete CON application by Regency Hospice of Northwest Florida, Inc. The Agency was persuaded that Regency was a proper applicant in light of its conversion from Regency LLC to Regency. On or before December 27, 2006, Regency, Odyssey, and United timely filed their completed CON applications, also known as the omissions responses. In particular, the president and CEO of Regency executed the "certification by the applicant," Schedule D-1, which stated in part: "I certify that the applicant for this project will license and operate the health services, programs, or beds described in this application." Reg 7 at Schedule D-1, p. 9. On January 9, 2007, the Agency adopted and approved the settlement agreement by entry of a Final Order. On January 12, 2007, the Agency published its decision in the Florida Administrative Weekly to accept the Regency Hospice of Northwest Florida, Inc., CON application. On January 16, 2007, the Agency advised Odyssey of the final Agency's decision to accept Regency's CON application. On February 5, 2007, Odyssey filed a petition to challenge the Agency's decision to accept Regency's CON application. On April 19, 2007, the Agency partially granted the Agency's own motion to dismiss "to the extent that the Petition is dismissed as moot and due to the fact that the Petitioner did not have standing to file the Petition at the time it was filed." In essence, the Agency decided that because Odyssey had already filed a petition to challenge the Agency's preliminary decision to deny its CON application and the Agency approval of Regency's application, that the filing of that petition rendered the original petition to challenge the agency's decision to allow Regency of Northwest Florida, Inc. to submit a CON application moot.2 There is no evidence that Odyssey sought appellate review of the Agency's April 19, 2007, Final Order. On November 8, 2007, Odyssey filed a Motion for Summary Recommended Order seeking dismissal of Regency's CON application. A similar motion was filed by United on November 9, 2007. Regency, joined by the Agency, filed a response. On November 26, 2007, a hearing was held regarding the motions and all counsel were heard. After hearing argument of counsel, the motions were denied without prejudice. As a matter of fact, Regency Hospice of Northwest Florida, Inc. did not exist at the time the LOI and shell CON application were filed with the Agency. The LOI and the shell CON application were filed on behalf of Regency Hospice of Northwest Florida, LLC that was not a corporation authorized to do business in the State of Florida and not eligible at that time to file a LOI or CON application to provide a new hospice program. Whether Regency Hospice of Northwest Florida, Inc., formed after the LOI and shell CON application were filed, is a viable applicant turns on whether the "conversion" statutes apply, or if not, whether the 'forgiveness clause,' Section 408.039(5)(d), Florida Statutes, applies. For the reasons stated in the Conclusions of Law, the issues regarding Regency's corporate status, while novel, are resolved in Regency's favor. Fixed need pool Pursuant to its numeric need methodology, the Agency published a fixed need pool or a numeric need for one new hospice program in Service Area 1 for the second batching cycle of 2006. In forecasting need under the rule methodology, the Agency uses the historical average three-year death rate. It applies it against the forecasted population two years out or for a two-year planning horizon, in this case January 2008. The projected first year of operation for a new provider in this case is 2008. Then, the Agency uses the statewide penetration rate, which is the number of hospice admissions divided by hospice deaths. The penetration rate is also considered a use rate in other health care arenas, but in hospice it is generally referred to as a penetration rate. The statewide average penetration rate is subdivided into four categories: cancer over age 65; cancer under age 65; non-cancer over age 65; and non-cancer under age 65. The projected hospice admissions in each category are then compared to the most recent published actual admissions to determine the number of projected un-met admissions in each category. If the total un-met admissions in all categories exceeds 350, the need for a new hospice is shown, unless there is a recently approved hospice in the service area or a new hospice provider has not been operational for less than two years. According to the Agency's fixed need pool methodology, the net un-met need for hospice's admissions in Service Area 1 is 450 additional hospice admissions in 2008. Among the four categories, there is a higher need projected among non-cancer patients. The percentage of non- cancer patients can vary from community to community and a hospice patient's admissions will likely reflect that local decedent population. (Historically, for RHG hospice operations, approximately 62 percent of the admissions were non-cancer diagnoses and 38 percent were cancer diagnoses, whereas Odyssey Healthcare's overall hospice experience is approximately 68 percent non-cancer and 32 percent cancer and UHS's experience is approximately 64 percent non-cancer and 36 percent cancer.) Demographics of Service Area 1 AHCA Service Area 1 consists of four counties: Escambia, Santa Rosa, Okaloosa, and Walton Counties, located in the northwest portion of the Florida panhandle. Geographically, the service area is large. It spans from the Florida-Alabama border on the west in Escambia County to the eastern border of Walton County over 100 miles away. The July 2006 population estimates for Service Area 1 indicate that the total population was approximately 700,000 with the four counties having the following population: Escambia (303,578); Santa Rosa County (140,988); Okaloosa County (193,298); and Walton County (56,900). In the most recent calendar year, there were 5,800 deaths in the service area and 6,400 deaths per year projected in the two-year planning horizon. The largest population center is Escambia County (and the city of Pensacola) followed by Okaloosa, Santa Rosa, and Walton Counties. Walton County is the fastest growing county, which experienced 40 percent growth in the last six years followed by Santa Rosa with approximately 20 percent growth. Overall, the service area grew approximately 11 to 12 percent. When Escambia County is excluded, the service area grew approximately 19-20 percent for the three eastern counties. Between 2006 and 2011, Santa Rosa County is projected to grow by approximately 16 percent and Walton County by approximately 20 percent. Service Area 1 has two major east-west arteries, with the I-10 corridor cross the central and more northern portion of the service area, and U.S. Highway 98 running along the coastal beach communities. There are 13 hospitals, 27 nursing homes, and two existing hospice providers in Service Area 1. The two existing hospice providers are Covenant Hospice and Hospice of the Emerald Coast. Covenant Hospice currently has its headquarters in Pensacola, Escambia County, and satellite offices in Milton, Santa Rosa County and Crestview and Niceville in Okaloosa County. It appears that Emerald Coast has its headquarters in Pensacola and a satellite office in Crestview. The existing hospice providers do not have offices in Walton County and neither has an office in Fort Walton Beach along the coast in Okaloosa County. Currently, Covenant Hospice provides approximately 86 percent of the hospice care in Service Area 1 followed by Emerald Coast providing approximately 14 percent of the hospice services. Emerald Coast does not serve hospice patients without primary caregivers. Based upon the 2,000 U.S. Census, the population of the State of Florida is 65.4 percent White; 14.6 percent African-American; 16.8 percent Hispanic; and 3.2 percent in the other category. With respect to Escambia, Santa Rosa, Okaloosa, and Walton Counties, the percentages of African-Americans, Hispanics, and others are as follows: Escambia (21.4 percent African-American, 2.7 percent Hispanic, and 5.0 percent other; Santa Rosa (4.2 percent African-American, 2.5 percent Hispanic, and 4.2 percent other; Okaloosa (9.1 percent African-American, 4.3 percent Hispanic, and 5.6 percent other); and Walton County (7.0 percent African-American, 2.2 percent Hispanic, and 3.5 percent other). The Hispanic population in Service Area 1 is low relative to the State of Florida, although it is projected to grow. On a percentage basis by county, the African-American population is lower than the statewide percentage, except Escambia County, which also has the largest population of the four counties in Service Area 1. The proposals Regency's proposal Regency proposes to establish its new hospice program with the immediate opening of three offices at commencement of operations in Pensacola, Escambia County; along the coast in Fort Walton Beach, Okaloosa County; and along the I-10 corridor in De Funiak Springs, Walton County. In its CON application, Regency projected the number of admissions in years one and two, 2008 and 2009, 242 and 496, respectively. With the projected average length of stay (ALOS) 60 days in year one and 80 days in year two, the overall projected patient days were 14,543 in year one and 39,686 in year two. The ALOS projections were demonstrated to be consistent with other Florida hospice start-up operations. The resulting total average daily census (ADC) from the proposed three office locations is 40 in year one growing to 108 in year two, with continuing growth thereafter. The Regency projections appear to be reasonable and achievable. Regency projects that it can open all three offices for $195,745. Odyssey suggests that Regency has impermissibly amended its CON application by describing proposed programs and services in great detail during the final hearing that were minimally, at best, discussed in Regency's CON application, including the omissions responses. See Odyssey's PRO at 44-52. In its CON application, Regency notes that it is a subsidiary Regency Healthcare Group, LLC, which offers hospice services in three states, Alabama, Georgia, and South Carolina. Regency described the corporate structure, including the entities operating in these states. Regency is also affiliated with two non-profit foundations, which accept donations and provide support to their hospice programs. Regency places heavy reliance on the experience of the existing hospice programs in Alabama, Georgia, and South Carolina. In its CON application, Regency lists several types of programs currently offered. For example, the Regency Hospice/New Beacon programs have a full-time pharmacist (Pharm. D.) on staff to assist their teams. Regency lists the services that its staff will directly provide and provide through contractual arrangements. Reg 7 at 33-34. (Regency [and United] mention providing dietary services through contractual arrangements, but the service is required to be provide by staff. AHCA 1 at 17.) Regency mentions that it will sponsor community education programs. Id. at 16. Regency also lists several non-reimburseable services provided by its affiliated hospice programs such as bereavement (for at last 12 months (13 months according to hearing testimony) following death of the patient) and chaplain services, the recruitment, training, and supervision of volunteers, hospice care for the medically indigent, flower and music ministries, and assistance with utility bills, food, clothing, and other necessities for needy patients. See Reg 7 at 2, 25, and 26. On page 12 of its CON application, Regency notes that for the year ending October 31, 2006, Regency affiliated hospice programs rendered 18.4 percent of total days of care to African- Americans and that "Regency will focus on this population as an outreach group since it is a significant part of the population of Service Area 1. This is particularly the case in Escambia County, which has the largest population, and African-Americans may be an underserved group." Regency mentions a potentially unmet need in Walton County and commits to opening an office in De Funiak Springs to serve the rural areas of the county. Id. at 23-25. Regency commits to providing care to persons without caregivers. Id. In several places in its CON application, Regency references continuous care generically, id. at 5-6, and based on the experience of Regency's affiliated hospice programs in other markets and expectations for the start-up of a new program, Regency projects patient days for continuous home care, routine home care, inpatient respite care, and general inpatient care. Id. at 32. On Schedule 7A, Regency has a line dedicated for continuous care as part of its revenue projections and also Schedule 8A provides for an expense for continuous care for years one and two. Id. at 27-28, 30, and 32. (Regency proposes 1.46 percent of continuous case; Odyssey, 1.33 percent; and United, a negligible amount.) During the final hearing, Regency expounded on these services. For example, there was testimony that as part of the "flower ministry," Regency expects to offer a Christmas tree program. It appears that the flower ministry and Christmas tree programs are local programs within the Birmingham, Alabama, area, spearheaded by a volunteer. It does not appear that Regency presently provides this service on a corporate-wide basis, although there is some intent to do so - it would depend on the leadership of their volunteers. See T 125-126, 142, 368, 537; Reg 83. In its CON application, Regency notes at page 32 that "[t]rained volunteers will provide important services by helping families and loved ones care for patients, by raising funds to support hospice services, and by performing administrative report functions." One witness, Ms. Acton, testified that her testimony was limited to the volunteer program in Jefferson County. Regency included letters of support in the deposition testimony of Richard Mason, Reg 79, indicating that Regency would be able to establish inpatient programs at the three Sea Crest nursing homes in Service Area 1 in Pensacola, Destin, and Crestview. (There is no affiliation between Sea Crest and RHG or its subsidiaries, except for two minority investors in Sea Crest who are also investors in RHG.) Overall, Regency's CON application mentions, although not in elaborate detail, the programmatic aspects of its proposal that were discussed in much more detail during the final hearing. United's proposal United proposes to establish a new hospice program in Service Area 1 with the headquarters in Milton, Santa Rosa County, Florida. It intends to open its first satellite office in Walton County when market forces indicate that it would be more efficient to have another office. United plans to have a dedicated hospice team located in Walton County to ensure access to services to the Walton County residences. United also proposes to have inpatient arrangements at its sister-facility in Milton as well as at nursing homes in Okaloosa and Walton Counties. United included letters of support from all three nursing homes indicating that it would be able to establish the proposed inpatient sites. In its CON application and during the final hearing, United provided a detailed discussion of hospice services it will offer. United is projecting project costs of $336,467. United Hospice of West Florida, Inc.'s parent is UHS- Pruitt, whose principle business appears to be the nursing home business. UHS-Pruitt also has a number of operating subsidiaries that appear to supply or enhance those nursing homes with physical therapy or pharmacy services. In its CON application, United focuses on minority outreach to the Hispanic population in the service area. As noted herein, the population of Hispanics in the service area is quite low compared to the statewide average. In its CON application, United projected that it would achieve 264 admissions in year one and 454 admissions in year two. United applied a median length of stay of 27 days to arrive at its projection of 7,185 patient days in year one and 12,061 patient days in year two. United's admissions and average daily census ramp up through the end of year one and then remain flat showing no growth throughout the second year of operation. United's projections appear to be reasonable and achievable. Odyssey's proposal Odyssey proposes to initiate hospice services by opening an office in Pensacola, Escambia County. In the final quarter of year two, Odyssey proposes to open a second office in Okaloosa County, and an office in Walton County in year three. Within six months following the opening of the Walton County office, Odyssey plans to open a fourth office in Santa Rosa County. Odyssey projected 270 admissions in year one and 411 admissions in year two. Odyssey projected in its CON application that it would have an ALOS of 25 in year one and 50 in year two, resulting in total patient days of 6,750 in year one and 20,550 in year two. Odyssey's projections for routine care for year two are similar to the percentages proposed by United and Regency. Odyssey proposes less cancer, but more respite and non-cancer care than United and Regency. United proposes more inpatient care than Regency and Odyssey. Odyssey's projections appear to be reasonable and achievable. Odyssey anticipates that it will cost $464,720 to start its Escambia office. Odyssey Healthcare, through its not-for-profit affiliate, Hospice of the Palm Coast, currently operates two start-up hospice programs in Florida, Volusia County, with a satellite office in Flagler County, Florida, and one in Dade County, Florida, with a satellite office in Monroe County. Both programs are licensed and Medicare/Medicaid certified. Odyssey will benefit from the clinical experience, expertise, management resources, and financial strength of Odyssey Healthcare in implementing its program within Service Area 1. Odyssey start-up team has a group of experts located in Odyssey's Dallas support center. The team consists of designated experts from several departments including billing, human resources, clinical compliance, and IT. The team meets weekly and is responsible to support the start-up hospice programs. For Odyssey Healthcare, hospice care is delivered via an interdisciplinary team of caregivers who specialize in end- death-of-life care, including nurse care managers, physician, nurses, spiritual advises, bereavement coordinators, social workers, home health aides, and members of the patient's family. The manager of the team is an RN who addresses the needs of the patient and family and develops a specific plan of care with the physician. The RN case managers coordinate care with other team members while the patient's physician works with the Odyssey medical director and other team members to assure that all symptoms are controlled, pain managed, and the patient and family informed. Other members of the interdisciplinary team include a chaplain, home healthcare aide, social worker, trained volunteers, bereavement coordinator, on-call nursing team, and other specialists. The interdisciplinary team delivers these services in a context of Odyssey Healthcare's 14 service standards by focusing on admissions within three hours of a physician admission order. Odyssey Healthcare offers certain educational tools which will be implemented by Odyssey to furnish healthcare providers with information about non-cancer and cancer diagnoses of all types. Odyssey commits to spending $25,000 in its first year of operation for community outreach and marketing. Odyssey identified the African-American community as an underserved population in Service Area 1. Odyssey Healthcare operates in numerous locales where there are culturally diverse areas such as Miami/Dade County and El Paso, Texas, with high percentages of Hispanic population. Other Odyssey Healthcare hospice programs have also reached out to African-American communities in Memphis, Tennessee, and Charleston, North Carolina. Odyssey's interdisciplinary teams are often made up of Hispanic or African-American medical directors, home health aides, social workers, priest, ministers, and nurses. Odyssey Healthcare has recreated a developmental model called community education representatives (CERs) to educate the community as to the benefits of hospice services and the services that are provided by Odyssey. These CERs are used to establish and develop referral sources in part. Odyssey Healthcare programs offer extensive bereavement programs (for 13 months after the death of the patient) as part of the core Medicare services it provides. Odyssey Healthcare operates hospice programs in Birmingham, Montgomery, and Mobile, Alabama. The Mobile program is in Baldwin County, which is contiguous to the Pensacola, Escambia County, an area Odyssey proposes to serve. Odyssey Healthcare's Mobile, Alabama, hospice program has an inpatient agreement with Providence Hospital in Mobile, Alabama, which has a related facility, Sacred Heart Hospital, in Pensacola, Florida, which has the same parent organization. Odyssey will benefit from Odyssey Healthcare's resources and experience with respect to start-ups as well as centralized services such as accounting, centralized billing, and training. All other benefits include the size of Odyssey Healthcare, comprehensive scope of hospice services, service standards, staff education including palliative care center vocation, commitment to education, and investment and technology. Odyssey Healthcare has internally developed an in- house pharmaceutical system called Hospice Pharmaceutical Services (HPS). HPS is a separate company and not a wholly- owned subsidiary of Odyssey Healthcare. HPS provides services 24 hours a day, 7 days a week, including pre-admission consultations on referrals. HPS hotline is housed in the Dallas Odyssey Healthcare corporate office and is staffed by a Pharm. D., a pharmacist, and seven hospice certified RNs and at least two on-call nurses who cover the pharmacy system 24/7. The HPS staff is available to the attending physician and to the local hospice nursing staff when needed. Odyssey included several letters of support in its CON Application. Statutory and Rule Review Criteria Rule Preferences The Agency is required to give preference to an applicant meeting one or more of the criteria specified in Florida Administrative Code Rule 59C-1.0355(4)(e)1.-5. The first preference is for an applicant who has a commitment to service populations with unmet needs. Each of the applicants identified population groups they believe to have unmet needs. Hospice patients can be viewed as consisting of four basic categories: cancer patients under age 65; cancer patients age 65 and older; non-cancer patients under age 65; and non- cancer patients age 65 and older. (This is the breakdown of hospice patients used by the Agency in its need methodology.) It appears that the largest underserved group of these four is the under age 65 non-cancer patients, followed by the non-cancer patients age 65 and older and cancer patients age 65 and older. The only over-served group was the cancer patients under the age 65. All applicants stated a commitment to serve non-cancer patients. However, only Odyssey and United identified this group as an underserved group and provided evidence concerning how they would meet the needs of this group. Historically, RHG hospice programs have provided approximately 62 percent of its patient care to non-cancer patients; whereas UHS has provided approximately 64 percent, followed by Odyssey Healthcare at approximately 68 percent. One witness suggested that a range of 35 to 50 percent was reasonable, although there are factors that affect the range such as age of the program. Regency and Odyssey identified African-Americans as a traditionally underserved group. However, while it is possible to extract the percent of the population by race group in the service area, neither applicant presented any concrete data to show that existing providers in the service area are failing to meet the demands of the African-American population or that this population group is underserved by the existing providers. The percentage of African-Americans in Escambia County according to 2000 Census information was 21.4 percent; 4.2 percent in Santa Rosa County; 9.1 percent in Okaloosa County; and 7.0 percent in Walton County. Regency stated that it "will focus on this population as an outreach group since it is a significant part of the population of Service Area 1." Reg 7 at Odyssey stated that African-Americans in the service area would benefit from Odyssey's experience. See Ody 1 at (bates stamp) 46, 59 and 74. United does not discriminate against individuals based upon ethnicity or for any other reason and it historically provides care to minorities. Both of the existing providers have offices in Escambia County and Regency and Odyssey both propose offices in this county. Odyssey presented data claiming that RHG hospice programs did a below average job in outreach and service to the African-American communities in areas served by RHG. The analysis was flawed in part because it compares the statewide experiences of RHG and Odyssey Healthcare based upon the operations in different local communities (e.g. rural versus urban) that can have different demographic compositions. Overall, the evidence indicates that RHG and Odyssey Healthcare have demonstrated a record of doing a credible job of outreach and service to the African-American community. All applicants agreed that providing continuous care services is an important level of service for hospice patients. In Service Area 1, continuous care accounts for only 0.6 percent of patient days; whereas the national and Florida averages are four and two percent, respectively. As noted herein, Regency and Odyssey propose a specific percent of continuous care, 1.46 and 1.33 percent, respectively, and United projects a negligible amount, see United 1 at Schedule 7A, although United proposes to provide the service. United identified patients without caregivers as an underserved population because Hospice of the Emerald Coast does not accept these patients. All three applicants will serve this population. United identified Hispanics as a population with unmet needs. Service Area 1 has the lowest percent of total population that is Hispanic of all of AHCA's service areas, although there is projected growth. In calendar year 2006, there were 59 Hispanic deaths out of 5,821 deaths in Service Area 1 or approximately one percent. In Santa Rosa County, where United plans to initially open its sole office, there were approximately seven Hispanic deaths in 2006. It was estimated that a little more than 20 Hispanics would use hospice services in the service area per year. Regency and Odyssey deserve preference under this subsection and United to a lesser degree. The second preference shall be given to an applicant who proposes to provide the inpatient care component of the hospice program through contractual arrangements with existing health care facilities, unless the applicant demonstrates a more cost-effective alternative. Each of the applicants proposes to serve inpatients through contractual arrangements. No applicant is proposing a freestanding inpatient unit. Through its related skilled nursing facility in Santa Rosa County, United has an existing relationship with a health care facility that will be used to provide inpatient care. United did not include all of the room and board expenses for Medicaid nursing home patients in its financial projections. United provided unauthenticated letters of support to demonstrate that it will be able to offer inpatient services in Santa Rosa, Okaloosa, and Walton Counties. United expects to offer only one office (primary headquarters) in Santa Rosa County that would serve the four- county service area. United expects to establish working teams in the other counties. Regency does not have any directly affiliated inpatient providers. However, Regency has commitments to enter inpatient contracts with, among other facilities, three nursing homes operated by Sea Crest Management through mutual investors. These nursing homes are located in Destin and Crestview in Okaloosa County, and Pensacola in Escambia County. Regency also has a commitment from Healthmark Hospital in De Funiak Springs, Walton County. Although Odyssey did not include any letters of support from any potential inpatient service locations in its original CON application, it stated that it will contract with acute care providers and skilled nursing home facilities in the service area. (Odyssey's CON applications have general letters of support of its application.) At hearing, Odyssey provided letters of support from area nursing homes, including a memorandum of understanding from the administrator of Southern Oaks Nursing Home in Pensacola, a 210-bed facility, indicating a willingness to provide inpatient services for Odyssey patients. Each applicant can be expected to contract for inpatient services and satisfy this preference. The third preference shall be given to an applicant who has a commitment to service patients who do not have primary caregivers at home; the homeless; and patients with AIDS. Each of the applicants presented evidence demonstrating a history and commitment to serve such patients and have in place programs and policies to ensure that such services are provided. The fourth preference provides: "In the case of proposals for a hospice service area comprised of three or more counties, preference shall be given to an applicant who has a commitment to establish a physical presence in an underserved county or counties." The two Service Area 1 existing hospice providers have their headquarter offices in Escambia County and there are currently satellite offices in Santa Rosa and Okaloosa Counties. There are no offices in Walton County, which is the smallest county of the four by population, 56,900 or approximately eight percent in 2006, but with the highest projected growth, 16,299, by percent, approximately 40 percent. Regency plans to open an office in Escambia and Walton Counties and an additional office in Fort Walton Beach along the Okaloosa County coastal area where neither existing providers have a current office location. Regency proposes the widest geographic coverage of offices of the three applicants, although the Escambia County office would add little. Its Walton County office would make it the only service provider with an office in that county. Odyssey plans to initially open an office in Escambia County and open an additional office in Okaloosa County starting toward the end of the second year of operation. Odyssey plans to open an office in Walton County in its third year of operation and a fourth office in Santa Rosa County six months thereafter. United proposes to open an office initially in Milton, Santa Rosa County. United proposes to have a dedicated hospice team in Walton County. No persuasive evidence was presented that residents of Walton County (or any other county in the service area) do not have access to hospice services or are actually underserved. The fifth and final preference provides: "Preference shall be given to an applicant who proposes to provide services that are not specifically covered by private insurance, Medicaid, or Medicare." All of the applicants meet this preference. Odyssey identifies several proposed services such as bereavement, pet, message, aroma, and music therapy, dialysis, palliative radiation, and palliative chemotherapy. United identifies similar services, although United provides bereavement coordination through either a social worker or chaplains. United does not allocate a specific position exclusively for bereavement. Regency identifies similar services such as bereavement following death, chaplain services, recruitment and training of volunteers, flower and music ministries, and assistance with utility bills, food, clothing, and other necessities. (The bereavement services offered, as well as policies and procedures used by RHG's hospice programs, are similar.) Bereavement and volunteer services are not specifically reimbursed by Medicare, but they are conditions of participation. The State of Florida requires all hospice providers to serve indigent patients and the applicants agree to provide hospice services to all regardless of their ability to pay. § 400.6095(1), Fla. Stat. The applicants have established charitable foundations to provide assistance to the medically needy for services that Medicare does not reimburse. Consistency with Plans; Letters of Support Florida Administrative Code Rule 59C-1.0355(5) requires consideration of the applications in light of the local and state health plans. The local health council plans are no longer a factor in this proceeding. Each applicant provided letters of support ranging from three for Regency; approximately 20 for Odyssey; and 161 for United. Statutory Review Criteria Section 408.035(2), Florida Statutes - availability, quality of care, accessibility, and extent of Utilization The Agency published a fixed need for one additional hospice in the service area. See § 408.035(1), Fla. Stat. There is no persuasive evidence to rebut the presumption of need and all parties concur there is a need for one new hospice. The service area is served by two hospice providers: Hospice of the Emerald Coast with a market share of 14 percent and Covenant Hospice with a market share of 86 percent. The extent of utilization of the two providers results in the projection for unmet need of 450 hospice admissions in 2008 growing to an unmet need of 507 admissions in 2009. Regency, United, and Odyssey projected the following admissions for their respective second year or operation (2009): 496, 454, and 411. Each applicant can reasonably meet the projected need in conjunction with the existing providers. Neither of the current providers has offices located in Walton County or in the Fort Walton Beach coastal communities. Regency plans to locate offices in these areas, which may improve accessibility. Odyssey proposes to serve Walton County from its Pensacola office until it opens a Walton County office. United proposes to meet the needs in Walton County by establishing a dedicated hospice team there and by establishing an inpatient treatment center at an existing nursing home. Aside from the numeric need projections, there is no persuasive evidence that any geographic portion of the service area or any discreet population category, such as African- Americans, Hispanic, or by age and cancer versus non-cancer groups, needing hospice services are truly underserved, although there is evidence that there are some gaps in services for the existing hospice providers when compared to statewide numbers of hospice use. Section 408.035(3), Florida Statutes - ability to provide quality of care and record of providing quality of care Each applicant has a history of providing quality hospice services. Each applicant has reported overall good responses on patient and family satisfaction surveys. Each applicant proposes to provide a broad array of hospice services to all persons regardless of their ability to pay. It is expected that each applicant will continue to provide quality of hospice services as they have in their existing programs. Each applicant will staff its hospice programs according to national guidelines. Regency proposes to staff its program with nurses on a ratio of one nurse for every ten patients as opposed to the ratio of one nurse for every 12 patients (the National Hospice and Palliative Care Organization [NHPCO] standard) proposed by Odyssey and United. Regency proposes more home visits per week (five-to- six hours per week) and more direct care hours as a percent of total staff hours than Odyssey and United. (The national average is four visits per week.) Regency and Odyssey have developed service standards. All of the applicants propose to offer similar hospice services that are discussed herein. There is evidence that Regency, in its Birmingham program, accepts medically complex patients when other providers may not. There is no evidence that any Regency or United hospice program has been cited for conditional level deficiencies, whereas Odyssey has been cited in approximately three programs, although the specifics and severity of each deficiency is unclear. It appears the deficiencies have been cleared. T 1244-1252. Odyssey also operates under a CIA, unrelated to any quality of care concerns. RHG has a Doctor of Pharmacy (Pharm. D.) on staff who is experienced in hospice and palliative care pharmacy issues. Dr. Blodgett makes regular visits to the offices in Alabama and at least quarterly visits to each of RHG hospice programs in Georgia and South Carolina; participates in IDT meetings, quarterly in South Carolina and Georgia and on a regular basis in Alabama; and is available for consultations on a regular basis. Dr. Blodgett averages between four to five home visits while working for New Beacon in Alabama. She has not made house calls yet in Georgia and South Carolina, although she consults with nurses in those areas and provides training for the hospice staff. Having a Pharm. D. on staff is advantageous for a hospice program. Dr. Blodgett recounted several representative events when she was able to directly assist a patient in dire straits. Dr. Blodgett currently oversees all of Regency's local hospice operations in Alabama, Georgia, and South Carolina with a combined average daily census of 900 to 1,000 patients, roughly 600 at New Beacon and 350 at Regency Hospice. RHG contracts for pharmacy services when Dr. Blodgett is unavailable. Odyssey provides pharmacy services through a consulting contract arrangement with a specialized pharmacy that is co-located with odyssey at its Dallas, Texas, headquarters. The consulting pharmacy has a Pharm. D. and a pharmacist on staff to provide consulting services to Odyssey's programs. The Pharm D. does not provide home visits. UHS-Pruitt has a subsidiary company, United Pharmacy Services, headed by a Pharm. D., which provides pharmacy services to the company's long term nursing home facilities, including its affiliated nursing home in Santa Rosa County. Fifty percent of United Pharmacy Services business is unrelated to UHS. The Pharm. D. is not responsible for oversight of the hospice operations. There are two licensed pharmacists who are not Pharm. D.'s within United Pharmacy Services who provide training for hospice staff and provide consulting services as needed 24/7. As a normal practice, they do not provide medications for hospice patients who at home. They consult on every hospice admission. Odyssey Healthcare has operational experience in Florida with two hospice programs, beginning in 2004. No confirmed complaints have been reported by the Agency. (Regency and United do not operate hospice programs in Florida.) Odyssey also has contiguous hospice program across Perdido Bay in Alabama. Odyssey Healthcare operates 76 Medicare certified hospice programs (or seeking certification) in 30 states. Odyssey will adopt Odyssey Healthcare's quality and improvement plans and its operational policies and procedures. United has an existing relationships with related party providers, particularly its Milton nursing home in Service Area 1. The United family of health companies located there includes a skilled nursing home, pharmacy, durable medical equipment provider, and a therapy provider. These shared resources may increase efficiency for United's hospice program. It also provides United with local contacts with physicians, hospitals, and nursing homes. Of course, in time, it is reasonable that Regency and Odyssey would develop similar relationships, although having existing relationships is a plus for United. An issue was raised regarding the applicant's commitment to provide continuous care. For the second year of operation, Regency proposes 1.46 percent; Odyssey, 1.33 percent; and United, a negligible amount, although United expects to provide continuous care days as needed by its patients. Given its existing nursing home as a component of its corporate family, United naturally provides more services to patients in its nursing homes and nursing homes owned by others. Section 408.035(4), Florida Statutes - availability of resources, including health personnel, management personnel, and funds for project accomplishment and operation Each of the applicants is a start-up company, relying on its parent organizations for financial and management strength. Each applicant has demonstrated sufficient resources to fund the start-up of a new hospice program. Controversies arose regarding when Regency and Odyssey would actually start-up operations following issuance of a CON and the amount each applicant allocated for start-up costs. Odyssey provided a start-up timeline in its application. The timeline assumes approximately six months from CON approval until Medicare certification. The timeline provides for approximately 60 days between licensure and Medicare certification. The timing of licensure and Medicare certification is imprecise at best. A provider is not entitled to reimbursement from Medicare until after certification. Operational expenses for treatment of patients between state licensure and Medicare certification would generally fall under start-up costs. Approximately three months prior to state licensure, Odyssey intends to hires a general manager who begins interviewing and hiring key staff. Other staff including the admission coordinator, RN, home health aide, dietician, social worker, and chaplain are hired in the third month. Odyssey projected its total project cost of $464,720 and total start-up costs of $350,000, with $240,000 allocated for salaries/benefits/taxes, over the six-month period from licensure approval until Medicare certification. (Odyssey exhibit 39 projects start-up expenses of $343,191.) Regency projected on Schedule 1 that its total project costs would be $195,745, with pre-opening staffing and recruitment costs of $36,500. Total start-up costs are projected at $60,000 for three offices. Mr. Morris joined RHG in February 2006. He is currently CEO for RHG and has experience with hospice programs. Subsequent to RHG's acquisitions, RHG started three hospice programs, one of which is a Medicare certified program in Augusta, Georgia, and two satellite offices. T 47, 50, 59-60, 62, 95-96. United projected on Schedule 1 that its total project costs would be $336,467, with total start-up costs at $57,257. According to Dr. Luke, if Odyssey's start-up model and time line is applied to Regency, i.e., month one is actual Medicare certification rather than licensure, Regency would need $543,408 in pre-opening expenses for the three offices it plans to open instead of $60,000 listed by Regency on Schedule 1. Odyssey also criticized United's projected start-up costs as too low based on Odyssey's six month start-up time line. United proposed it would hire most of its staff 30 days prior to licensure. United's vice president in charge of development who has started 15 to 20 hospice operations stated that it is a reasonable approach to hire, orient, and train staff one month prior to licensure. According to Dr. Luke, if Odyssey's start-up model and time line is applied to United, United would need $201,482 rather than $57,257 projected by United on Schedule 1. If month one is the month when United achieves licensure, then the start- up expenses would be $115,846 according to Dr. Luke. The persuasive evidence shows that Regency and United do not use the Odyssey start-up model and time line. Regency's pre-opening costs on Schedule 1 include only the pre-opening salaries prior to initial state licensure of the hospice rather than Odyssey's approach. The salary and wage expenses for Regency after initial licensure are included on its Schedule 8A projection of expenses, whereas it appears Odyssey started its Schedule 8A expenses on the date of Medicare certification. Dr. Luke agreed that this difference in approach would reduce his estimate of pre-opening expenses from $543,408 to $297,792. In other words, if Regency's month one, year one is licensure not certification, according to Dr. Luke, Regency's start-up expenses would be $297,792. Unlike Odyssey, Regency proposes to hire its local executive director one month prior to licensure. All of the additional patient care staff necessary to care for the low initial patient census in the first month of operation would also be hired and undergo training 30 days prior to licensure. Additional staff would be hired and start on day one of licensure and undergo training during the first month of operation while the patient census is in the ramp up stage. While Odyssey and Regency propose differing start-up models and time lines with differing hiring schedules and Regency's time line appears to be quite concentrated, both applicants have sophisticated parent company's who have experience with hospice operations, albeit that Odyssey has more experience than Regency or United with start-up hospice programs, especially in Florida where Regency and United have no experience and Odyssey has experience with two start-up hospice programs. (Regency has not done any start-up hospice programs in a state where either Regency or New Beacon had no presence, although it was noted by a witness that the markets were similar except for the CON process in Florida.) Like, Odyssey, United has start-up experience and given its time-line, its projected start-up costs are reasonable. The start-up costs and expenses projected by the applicants are reasonable, although it would appear the Regency's projected start-up costs may be overly optimistic. In any event, the parent organizations have sufficient funds to cover projected start-up costs and expenses. All of the applicants demonstrated they can recruit staff to adequately provide hospice services. Section 408.035(5), Florida Statutes - extent to which proposed services will enhance access to health care for residents of the service district There is a projected need for one additional hospice program in the service area. Approval of any of the applicants would enhance access to some degree and it is difficult to predict which applicant would enhance access the best. Regency proposes to open three offices immediately in Escambia, Okaloosa, and Walton Counties. Regency would have the only office offering hospice services located in Walton County. Covenant has an office in Niceville in Okaloosa County and not far from Fort Walton Beach, also a site proposed for a Regency office. The existing providers have their headquarters in Escambia County, also the location of Odyssey's headquarters and initial office. Thereafter, Odyssey plans to open offices in Okaloosa, Walton, and Santa Rosa Counties in this order. United plans to open its initial office in Santa Rosa County where its related nursing home is located. United plans to have dedicated hospice team in Walton County and perhaps a second office located there in the future. Of the three applicants, United would enhance access the least. The proposed office locations for Regency and to a lesser extent Odyssey would probably favor Regency rather than Odyssey, although it is one of degree. Some of the factors that favor Regency and Odyssey over United are: Regency and Odyssey expect to provide a specific percent of continuous care, 1.46 and 1.33, respectively; both project to serve more patients (by patient census) than United; both will focus efforts more on a service area wide basis than related nursing home patients in the case of United; and both will devote more FTEs for community hospice/education representatives and information materials than United. Section 408.035(6), Florida Statutes - immediate and long-term financial feasibility Short-term financial feasibility is considered to be the ability of an applicant to finance the start-up of operations. Each of the parent entities of the applicants has sufficient funds to finance the start-up of operations and, as a result, each applicant demonstrated immediate or short-term financial feasibility. Each of the financial projections relating to long- term financial feasibility submitted by the applicants has problems. There is no rule or statute that expressly defines long-term financial feasibility, notwithstanding the requirement that an applicant provide the Agency with detailed financial projections, including a statement of the projected revenues and expenses for the first two years of operation after completion of the proposed project. § 408.037(1)(b)3., Fla. Stat. The applicants provided financial projections for two years of operation. Thus, as identified by the applicants, long-term financial feasibility relates to whether an applicant has the ability to break even or show a profit by the end of the second year of operations. See generally T 1412, 1533. Regency's errors including typographical errors, admittedly small (the inclusion of Medicare revenue that would not be received for the first 45 days to two months of operation while the hospice program would not yet have Medicare certification), would not affect the projected long-term financial feasibility of its project. The errors affect the year one projections only and resulted in a projected write-off of approximately $31,000 or an increase to the projected loss of approximately $31,000. Regency shows a profit in year two. Also, regardless of whether Regency's projection of pre-opening expenses is reasonable or not, which it appears to be, Regency has adequate cash on hand to open its three proposed offices and the pre-opening expense if greater than projected is not likely to affect long-term financial feasibility. United's financial schedules contained an error by omitting the room and board expenses for Medicaid nursing home residents who receive hospice care. This failure to include the full cost of inpatient care would result in a shortfall in the pro forma of between $50,000 to $150,000 and potentially $373,000 in year two of operation. United also explained that it used a conservative number of patient days on its financial schedules. It is likely that if United had used a mean average length of stay rather than a median length of stay, the projected revenues would likely have increased although offset by increasing expenses. In other words, it would have increased the average daily census and thereby increased the revenues. Mr. Shull testified that he expected that the United proposal would be financially feasible in the long-term based on the experience in its other hospice programs. Odyssey's financial projections were the subject of focus by the applicants. See, e.g., Odyssey's PRO at paragraphs 53-55; Regency's PRO at paragraphs 203-210; and United's PRO at 43-45. On Schedule 6, an applicant sets forth its projected staffing for the project. When reporting full time equivalents (FTEs) for staffing, the Agency does not proscribe the specific format to be used. On its original Schedule 6 contained in the application, Odyssey set forth the number of year-end FTEs as opposed to using a weighted average of FTEs for the year. Regency suggested that, as a result of Odyssey's portrayal of staffing information, there was no link between Odyssey's Schedule 6A FTEs and salaries and the expense for staff's salaries and wages on Schedule 8A. Regency also contended that Odyssey did not account for staffing expenses associated with the provision of respite care and continuous care. Further, although Odyssey proposes to spend $25,000 in community outreach and marketing programs in its first two years of operation, that expense was not included in its pro forma projections. Odyssey prepared numerous exhibits, including revisions, that deal with these areas and various witnesses explained and offered rebuttal in response. Regarding the continuous care/respite issue, if appropriate revisions are made to Odyssey's pro forma, on paper, there is likely to be a projected net loss in year two of approximately $100,000. Odyssey proposes changing the 13.5 percent management fee that was included in the application to a seven percent management fee. Odyssey Healthcare's two not-for-profit Florida hospice entities are charged a seven percent management fee, similar to the fee it charges to other not-for-profit subsidiaries. Odyssey's proposed seven percent management fee is in line with the management fees proposed by Regency (7.2 percent) and United (6.3 percent). It appears reasonable to charge not-for-profit entities a lower fee because these entities would not be charged with the home office costs associated with various regulatory filings associated with being a publicly traded company. On the other hand, other than perhaps being a mistake, Odyssey's rationale for charging a different management fee for the applicant, a for-profit entity, T 1039, than other related for- profit entities is a departure from the norm. Changing the management fee and accounting for all of the adjustments to its financial schedules would result in Odyssey showing a year two profit of approximately $80,000. Section 408.035(7), Florida Statutes - extent to which proposal will foster competition that promotes quality and cost- effectiveness Approval of any of the applicants is likely to foster competition, thereby improving quality and cost-effectiveness in the service area, although there is no evidence that the current providers do not provide quality of care or are not cost- effective. Hospice services are not price competitive because Medicare pays a flat per diem rate to all providers in a given area and the vast majority of hospice patients are Medicare patients. Each provider has the ability to increase community awareness of available hospice services thus increasing the opportunity for increasing market penetration of all providers. United has existing linkages in the community that it serves through its related nursing home and other related companies. United's prospects of achieving cost-efficiencies and economies of scale are increased because of these relationships. Regency and Odyssey can also achieve similar efficiencies through their existing relationships with related entities. Having an office in a particular county such as Walton County, would most likely establish and promote a presence in the area that would be beneficial given its rural setting. However, it was not persuasively proven that opening more versus fewer offices in the short-term is more beneficial to the potential hospice patient pool from the standpoint of actually promoting cost-effectiveness and quality of care, although it does increase the physical presence of a hospice provider and give potential patients more choices. Section 408.035(8), Florida Statutes - costs and methods of construction, etc. None of the applicants are proposing construction as part of their hospice programs, thus, this criterion is not applicable. (Section 408.035(10), Florida Statutes, is also not applicable.) Section 408.035(9), Florida Statutes - the applicant's past and proposed provision of health care services to Medicaid patients and the medically indigent All of the applicants propose to serve all eligible patients without regard to ability to pay and have a history of providing patient care to the medically indigent. All of the applicants have allocated patient days to serving, e.g., Medicaid patients. Regency offered to provide 2.5 percent of patient days to the medically indigent as a condition on the CON. Odyssey and United did not offer a similar condition. However, the Agency states in the SAAR that "[b]ecause hospice programs are required to provide services to anyone seeking them, CON conditions are not necessary to ensure such care is given." AHCA 1 at 6. Ultimate findings of fact The Agency determined that there is a numeric need for one additional hospice program in the service area. On balance, each of the applicants satisfies the applicable statutory and rule criteria, although the projected long-term financial feasibility by year two on paper of United's proposal was not proven. This proceeding involves a close question. The Agency preliminarily approved Regency's application. The only evidence of the Agency's rationale for its position is stated in the SAAR, which does not include consideration of the facts presented in this de novo hearing. Each of the applicant's related entities has experience starting-up, owning, and operating hospice programs with Odyssey related entities operating two programs in Florida unlike Regency and United. Each applicant's related hospice entities provide a broad array of hospice services to all persons regardless of their ability to pay, race, severity of illness, or setting where hospice services need to be provided. Each applicant demonstrated a history of service, by related entities, to Medicaid and medically indigent patients. The residents of the service area would benefit regardless of which applicant is approved. The applicants are committed to community outreach and can be expected to heavily market their services. All of the applicants demonstrated that they will actively recruit needed personnel. United's presence in the service area may give United an edge with regard to recruitment, but if so, the edge is slight. Consistent with NHPCO standards, Odyssey and United propose a ratio of one nurse for every twelve patients. Regency proposes a better ratio: one nurse for every ten patients. Regency's Pharm. D., although spread thin given the number of hospice programs served by Regency's related entities in three states, is a positive feature. Despite correcting errors in its financial projections, Regency demonstrated financial feasibility in year two of operations and should receive a comparative advantage. Odyssey and United had problems with proving long-term financial feasibility. Odyssey, after revisions to its financial schedules and reducing the proposed management fee, demonstrated financial feasibility by year two. United can expect to have a loss in year 2, but like Odyssey, its parent organization has a strong financial position and is committed to the project such that it is likely to be financially feasible beyond year two. Regency expects to initially open three offices and, in particular, one in rural Walton County. Odyssey plans to open an office in each county within the service area, although staggered. United plans to open one office initially and takes a wait and see approach regarding opening other offices. The approach of United and to a much lesser extent Odyssey, require less overhead expense but is not necessarily appropriate given the need for an additional hospice services over a four-county area, although the need projection does not indicate which portion or portions of the service area need the additional program the most or where underserved persons may be located, although there are gaps in service. Regency should receive a slight advantage for proposing to offer slightly more continuous care than Odyssey and a greater advantage over United, which expects to provide the service, but did not allocate a specific percentage of care. United receives an edge given its established relationships in the service area by and through its related service providers. The United family includes a nursing home, pharmacy, durable medical equipment provider, and a therapy provider. It gives United the opportunity to share resources among programs to increase efficiency. Odyssey receives a plus given current operations in Florida and contiguous operations across Perdido Bay in Alabama. Odyssey Healthcare's prior problems with the federal government, Medicare cap issues, and unfavorable surveys detract from the overall positive features of Odyssey's proposal. Regency has had one Medicare cap issue. United does not share these problems. Overall, and in a tight comparative review hearing, the persuasive evidence favors Regency followed by Odyssey with United closely behind Odyssey.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered approving of Regency's CON No. 9971 and denying United's CON No. 9955 and Odyssey's CON No. 9954. DONE AND ENTERED this 30th day of April, 2008, 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 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 30th day of April, 2008.
The Issue Which of two applications for a Certificate of Need (CON) to operate a hospice in Service Area 8B, Collier County, Florida, should be granted: CON 9967 filed by Hope Hospice and Community Services, Inc., or CON 9969 filed by VITAS Healthcare Corporation of Florida?
Findings Of Fact The Parties AHCA The Agency for Health Care Administration is responsible for the administration of the Certificate of Need (CON) Program in Florida and for carrying out Florida's CON Law. See § 408.031, Fla. Stat., et seq. The Agency is designated both "as the state health planning agency for purposes of federal law . . . [and as] the single state agency to issue, revoke, or deny certificates of need . . . in accordance with present and future federal and state statutes." § 408.034(1), Fla. Stat. HON Hospice of Naples, Inc. (HON), a not-for-profit corporation qualified as a "501(c)(3)" charitable organization under the Internal Revenue Service Code, is a community-based full service hospice. Founded in 1983 by a group of volunteers who wanted to improve care for those suffering terminal illnesses in Collier County, HON is governed today by community representatives that comprise a 19-member board of directors. HON is the only hospice currently licensed to provide hospice services in Service Area 8B, Collier County. It is licensed to provide hospice program services and to operate a freestanding general inpatient program facility in the county. Since 1988, HON has been continuously Medicare and Medicaid certified. It has been accredited by the Joint Commission for Accreditation of Health Care Organizations since 2001. HON accepts all Collier County patients, regardless of religious beliefs, sexual orientation, and circumstances, including how the patient may be challenged physically or mentally. HON provides its services wherever the Collier County patient resides: in their own homes (approximately 50%); in skilled nursing facilities and assisted living facilities (45%); in jails, shelters and the Georgeson Hospice House (5%); and in a small fraction of cases in hospitals. Patients are also accepted regardless of ability to pay. In 2006, HON provided $344,000 in charity care to those who did not have the resources to pay for hospice care. HON's principal office is located on the same campus with the Frances Georgeson Hospice House (the "Georgeson House"), HON's 16-bed freestanding hospice general inpatient facility. The main office and Georgeson House are centrally located and geographically accessible in relation to the most populated portions of the county. HON has four branch offices placed where the greatest number of hospice patients reside in the county. The offices are in Marco Island, Immokalee, North Naples (near the Collier-Lee County line), and South Naples. HON consistently relies on donations from the community to cover shortfalls from operations. From 2002-2006, HON lost between $1.5 million and $4.5 million annually on operations, before contributions were considered. Contributions over the same period ranged from $1.5 million to $4.4 million. HON relies on contributions to allow it to continue to provide a wide array of enhanced core, non-core and community services beyond what reimbursement covers. Collier County has been well served by HON, an available, accessible, high quality, not-for-profit community-based hospice. VITAS VITAS is a for-profit Florida corporation licensed to provide hospice services in Florida. It is a wholly-owned subsidiary of VITAS Healthcare Corporation ("VITAS Healthcare") which operates more than 40 hospice programs in the nation and is the largest hospice provider in the country. VITAS has a sister corporation, VITAS of Central Florida, Inc. The two operate hospice programs in Hospice Service Areas 4B, 7A, 7B, 7C, 9C, 10, and 11 that include Orange, Osceola, Seminole, Brevard, Volusia, Flagler, Miami-Dade, Monroe, Broward, and Palm Beach Counties. VITAS and its predecessor entities have provided comprehensive hospice services throughout South Florida in excess of 28 years. It has a storied history that commenced in the mid-seventies with the organization of a group of hospice volunteers by Hugh Westbrook, an ordained United Methodist minister, and Esther Colliflower. These initial efforts led to the incorporation of Hospice Care, Inc., in Miami as one of the nation's first hospice programs. Reverend Westbrook and Ms. Colliflower continued their pioneering endeavors in hospice as leaders in the successful effort to create a federal payment system for hospice. In the early 1990's Hospice Care, Inc., was converted into a for-profit entity. The term VITAS, derived from the Latin word for "lives," was incorporated into the name of the corporation to symbolize the mission of VITAS Healthcare: the preservation of the quality of life for those who have a limited time to live. VITAS Healthcare is a wholly owned subsidiary of Chem-Ed, a for-profit corporation. Chem-Ed has had an interest in VITAS Healthcare at least since 1991 when it was an owner of 25% of VITAS Healthcare stock and one of its executives, Tim O'Toole took a seat on the VITAS Healthcare board of directors. In 2004, the majority ownership of VITAS Healthcare was sold to Chem-Ed and Tim O'Toole became VITAS Healthcare's Chief Executive Officer. Most of the senior management stayed intact after the acquisition by Chem-Ed. Among the reasons for retaining senior management was to continue VITAS Healthcare's values in the wake of the acquisition. The main value is "putting patients and their families first." Hope Hope Hospice and Community Services, Inc. (Hope), is a not-for-profit community-based hospice organization incorporated as a 501(c)(3) charitable corporation under the Internal Revenue Code. Hope is governed by a board of directors, all of whom are residents of Hope's service area. As business and community leaders in Southwest Florida, Hope's Board members know the Hope service area well. Their in depth knowledge of the community enhances their sensitivities to the needs of the communities served by Hope. Founded in 1979 by a group of clergy, nurses, and other volunteers in Lee County, Hope became a Medicare certified hospice in 1984. Since 1991, Samira Beckwith has served as Hope's President and CEO. Ms. Beckwith has been actively involved in hospice since 1976, and has received numerous state and national awards for her work in hospice and end-of-life issues. Originally licensed to serve Service Area 8C (Lee, Hendry, and Glades Counties), Hope has been licensed since 2006 to serve Service Area 6B (Polk, Hardee, and Highlands Counties) as well. Hospice Care Hospice care may be provided in any location where a patient has lived or is temporarily residing such as a private home, family member's home, assisted living facility (ALF), nursing home, hospital or other institution. There are four levels of hospice care: routine home care, general inpatient care (GIP), continuous care and respite care. The majority of hospice patients receive routine home care. This level of care may be provided in the patient's home, a family member's home, a nursing home or an ALF. Routine care comprises the bulk of hospice patient days. Continuous care is also provided in the patient's home. Unlike routine home care, continuous care is nursing assistance at a time of crisis for the patient. Typically, it is for control of acute care pain or symptom management on a short-term basis. Continuous care is usually intermittent. The use of the term "continuous" as a descriptive adjective to describe this type of hospice care, therefore, makes "continuous care" a misnomer. Continuous care requires a minimum of 8 hours of one-on-one care in a 24-hour period with at least 50% of the care provided by a nurse. The other half of the care may be provided by personal care assistants or nurses' aids. General inpatient care or GIP refers to the care a hospice patient receives in an inpatient setting such as a hospital, a Medicare-certified nursing home or in a freestanding hospice unit. This type of care involves increased nursing and physician care for patients with symptoms temporarily out of control and in need of round- the-clock nursing to manage complications. The least used level of hospice care, respite care is provided to patients in an institutional setting such as a nursing home, ALF or freestanding hospice unit in order to allow care givers at home, such as family members, a short break or "respite" from the demands of caring for a terminally ill patient. Penetration Rates An objective measure of accessibility of a hospice program is the penetration rate ("P-rate") in the hospice's service area. P-rate is the ratio of hospice admissions to total deaths in a service area. It is a basis for planning for hospice programs in the state of Florida. Hope touts its P-rate in Service Area 8C as a basis for its superiority over VITAS. Its P-rate in Service Area 8C has always exceeded the state-wide average. For the June 2006 reporting period, its P-rate was 62% when the statewide average was 56%. Hope has continually increased its P-rate at a rate higher than the rate of increase of the statewide average. The Fixed Need Pool and the SAAR On October 6, 2006, AHCA published a fixed need pool for one new hospice program in Service Area 8A for the second batching cycle of 2006. On October 27, 2006, HON filed a challenge to the fixed need pool. The challenge was denied by final order. HON appealed. The appeal was dismissed. In the meantime, five hospice organizations submitted letters of intent and CON applications for a new hospice in Service Area 8A: VITAS, Hope, HCR Manor Care Services of Florida (HCR), Evercare Hospice of Collier County (Evercare), and Odyssey Healthcare of Collier County, Inc. AHCA issued its State Agency Action Report (SAAR) on February 23, 2007. The SAAR approved VITAS' application and denied the others. Notice of AHCA's decision was published in the March 9, 2007, edition of the Florida Administrative Weekly. Between March 12, 2007 and March 29, 2007, HON and three of the denied applicants (Hope, Odyssey, and HCR) filed petitions challenging the approval of VITAS' application. The petitions of Hope, Odyssey, and HCR also challenged the denials of their respective applications. Evercare did not challenge any of the Agency's decision. On March 23, 2007, VITAS filed a petition supporting the decisions of the Agency and requesting comparative review of its application with the applications of the other applicants that had challenged AHCA's decision. In their applications, VITAS and Hope aspire to meet the need published for a single new hospice in Service Area 8A. They also contend in their applications that "special circumstances" demonstrate need for an additional hospice program in Collier County. The need formula in Florida Administrative Code Rule 59C-1.0355 (the "Hospice Programs Rule"), produces a fixed need pool for "1" or "0." The Agency's position is that the formula can never generate a fixed need pool in excess of 1. See Fla. Admin. Code R. 59C-1.0355(4)(a): Numeric Need for a New Hospice Program. Numeric need for an additional hospice program is demonstrated if the projected number of unserved patients who would elect a hospice program is 350 or greater. The net need for a new hospice program in a service area is calculated as follows . . . . (Emphasis supplied). The existence of a fixed need pool of "1," alone, does not prove there are gaps in service if there is an existing hospice provider in the service area. HON's expert, Mr. Davidson elaborated on this point at hearing: The purpose of the rule is not to identify service areas where existing providers are not getting the job done now . . . it's a temptation to interpret a fixed-need pool that way but it's an incorrect temptation. [T]he rule . . . identifies service areas where the growth in hospice admissions is projected to be sufficiently large to enable a new program to be approved without digging into the level of service of the existing provider. Tr. 3708-3709. In this case, the fixed need pool of 1 was attributable more to projection of service area deaths than the use of penetration values used in the formula for calculating fixed need. When a fixed need pool of "1" has been published, and an applicant responds to the numeric need and also alleges that special circumstances exist to justify approval of a new hospice, the Agency views the special circumstance allegation, even if proved, to be a potential preference for the applicant in the context of comparative review. The existence of a special circumstance is not a basis for the approval of more than one applicant in a batching cycle. The Hospice Programs Rule is interpreted by AHCA to permit the approval of only one hospice program in any one batching cycle. This interpretation stands so that only the superior application may be approved even in cases where: a.) there are two hospice organizations qualified to meet numeric need and b.) coincidentally there are special circumstances that would otherwise justify the inferior application's approval. Adverse Impact to HON if Two Programs Approved If the applications of both VITAS and Hope were to be simultaneously approved, HON would experience a significant reduction in average daily census (ADC). By 2009, it is reasonably projected that its census would be reduced to 180 patients, a decrease from 2007 of about 61 patients in the second year of operation for the two new programs. Net income (including donations) for HON in the second year of operation for two new programs, if ADC were decreased by 61 patients, would likely be reduced by approximately $1.2 million. Historically, HON has a net operating loss before contributions ranging from $1.5 million to $4.5 million. The likely reduction in net income would be significant. Reduction in HON's programs would be necessary to make up for the lost revenue. A number of community programs would have to be eliminated. Core and non-core services would have to be reduced. It is possible that there would an indirect adverse impact to HON as well: a breach of trust perceived by the community and donors when community services which have come to be expected are reduced or withdrawn. Service Area 8B: Collier County Service Area 8B, located in Southwest Florida along the coast of the Gulf of Mexico, consists of one county. Collier County is relatively large in area. Its population of around 360,000 is most dense along the coast in the county's westerly parts. Service Area 8A borders Service Area 8C to the north and Service Area 10 and 11. The more populated communities in Collier County are more congruent with communities in adjacent Service Area 8C, where Hope operates. Service Areas 10 and 11, where VITAS operates, on the other hand, are separated from the densely populated areas of Collier County by wide expanses of relatively unpopulated borderlands. Service Areas 8A and 8C have some similar demographics. For example, both are less densely populated than the state as a whole. Both service areas are growing at a rate that is faster than the rate of growth of the state as a whole. The percentage of the two service areas in the 65+ age cohort is the same and is higher than the statewide average for that age cohort. The two have a similarity in the percentage of Hispanic population. The median household net worth in both service areas is higher than the statewide average, considerably so in the case of Collier County. The two service areas have similar mortality rates and a similar array of causes of death for their residents. Proximity of Hope to Collier County Health Care Facilities Collier County has four hospitals, two within each local health care system. NCH Health System (NCH) operates Naples Community Hospital and, less than 10 miles from the Lee County line, North Naples Hospital. Health Management Associates (HMA) operates Physicians' Regional Hospital at Pine Ridge Road and at Collier Boulevard. The two NCH hospitals have 681 beds, while the HMA hospitals have approximately 180 beds. Collier County has many skilled nursing facilities. Collier County hospitals serve some residents of Service Area 8C. The import of the proximity of Hope's current operations in Lee County and Service Area 8C to Service Area 8A was summed up at hearing by Hope's expert planner, Jay Cushman: Because of Hope's proximity to the proposed service area, it has relationships that already exist between important providers of health services in service area 8B including hospitals. From time to time, residents of Hope's service area are hospitalized in Collier County, and Hope's staff visits them if they are going to be referred back to Lee County or other counties in service area 8C as hospice patients. Hope Hospice also operates a long-term care diversion program ["LTCD Program"] which includes services to residents of Collier County. So Hope Hospice is already engaged in providing social and health services to service area 8B in a way that puts them in a natural position to identify patients who are in need of hospice care and to see that their admission to hospice care is accessible and a matter of continuity of care between their participation in the [LTCD Program] and potential admission to hospice. Tr. 2899-2900. Furthermore, of Collier County residents requiring hospitalization, six percent are admitted to hospitals in Lee County. In contrast, the relationship between Collier County residents and admissions to Miami- Dade or Broward County hospitals is insignificant. Having a presence in an adjacent service area does not guarantee success for Hope. When Hope sought to expand to Service Area 6B (Polk, Highland, and Hardee Counties), it made arguments of "contiguous" communities and "established referral networks." Yet, Hope only achieved approximately one-third of its projected first year admissions in Service Area 6B. If Hope is approved as a result of this proceeding and Hope continues its management of the LTCD program in Collier, moreover, it is likely to have an adverse impact on HON with regard to certain referrals. If VITAS is approved, the potential for a hospice operated LTCD program to facilitate referral advantages will not exist. VITAS will not start an LTCD program if its application is approved. The differing impact that co-batched applicants might have on an existing provider is considered by AHCA to be relevant to comparative review. COMPARATIVE REVIEW Relative Impact on HON; Donations Unlike VITAS, which has an affiliated foundation that accepts memorials, bequests and unsolicited donations, Hope and HON actively solicit and depend on donations to cover operating losses annually. HON's only source of revenues are Medicare, Medicaid, and Insurance (combined 82%); Contributions and fundraising (16%); and thrift shop revenue (2%). From 2002-2006 inclusive, HON lost between $1.5 million and $4.5 million on operations, before contributions were considered. Contributions over the same period ranged from $1.5 million to $4.4 million. HON relies heavily on contributions to make up annual shortfalls in revenue and to allow it to continue providing a wide array of core, non-core and community services beyond what reimbursement covers. HON's operational expenses annually exceed revenue, because of HON expenses incurred to ensure quality and accessible care. For example, HON employs highly trained clinicians and deploys them on specialty teams. In addition to its regular home care teams, HON has a Float Team, to ensure there are no service gaps. It also has a Central Facilities Team, comprised of RNs and Aides, experienced with the unique needs of nursing home based hospice patients who exclusively serve HON's patients in nursing homes and assisted living facilities. It also has an On-Call/After Hours Team, a special Weekend Home Care Team, an Admissions and Intake Team, and complementary therapies. Besides the RNs assigned to direct patient care, HON also employs RNs for all key managerial positions. At HON the CEO, Director of Compliance, Clinical Services Directory, Quality Manager, Clinical Education Director, General Inpatient Care (GIP) Clinical Manager and all team managers are all experienced RNs. This depth in personnel allows more clinicians to spend more time with patients and families and to deliver high quality specialized care. It is expensive. It involves hiring and retaining the most experienced, specialized and certified clinicians available. HON has one of the lowest nurse to patient ratios in Collier County: 1 nurse to every 11 patients in home care and 1 nurse to every 4 patients in GIP. These lower ratios mean more care at the bedside and more support for the patient and family. HON uses certified home health aides and nurses assistants rather than homemakers to perform homemaker services for patients. HON has placed certified RNs in all of its key management and care giver positions, with high concentrations of certified RNs on the specialty teams. The certification of hospice and palliative care nurses and home health aides signifies the highest level of competency and specialization in the end of life clinical care. Charitable contributions received by HON, to offset operational losses are broadly categorized as "solicited" and "unsolicited." Solicited funds are monies that HON raises through newsletters, direct solicitation, special events, and individual and corporate underwriting. Unsolicited money comes from memorial gifts and bequests, primarily from patients and patient families. Although Naples may be the one of the wealthiest communities in Florida in terms of disposable wealth, it does not mean there is an inexhaustible pool of money for charitable contributions. The window of opportunity to sponsor a well attended charitable fundraising event in Collier County is January through April. A Naples Charity Register is published annually, to confirm for the donors and event sponsors how the limited space on the calendar of charitable events has been allocated. Each year, there are over 300 not-for-profit organizations in Collier County competing for a weekend, between January and April, to schedule their fundraiser. Solicited funds received from special events are the result of relationship HON nurtures with other organizations in the community. Special event funding is not limited to HON; the market for fundraising in Collier County is highly competitive. Each new fundraising season requires that HON renew relationships, which can be preempted at any time by another charity. HON's historical relationships simply do not guarantee that a community organization will in the future choose to give charitable dollars to HON. HON's ability to maintain these relationships with donors is enhanced by the fact that it is currently the only not-for-profit hospice in Collier County. Like HON, Hope is also heavily dependent on donations and charitable contributions to cover Hope's annual operating losses, which historically range from $1 million to $5.1 million annually. As in the case of HON, Hope is a 501(c)(3) charitable organization, authorized to solicit donations from the general public and to provide receipts for those donations, so that donors can take tax deductions for their donations. The amount of contributions Hope solicits is impressive. In 2006, when all contributions and net assets released from restrictions/satisfaction of donor requirements were considered, Hope raised $4.3 million in charitable contributions. Hope is more successful than the average hospice at raising charitable donations for its hospice program. It has a track record of being committed to raising substantial amounts of money in its own service area through special events. Hope solicits its larger donations from the same sort of activities (tennis and golf charity events) as does HON. Hope's enthusiasm for special event soliciting is exemplified by Hope's decision to include a notice of the "Hope Gala" in the 2006-2007 Naples Charity Register, to directly solicit funds from the Naples area in which Hope is not licensed as a hospice, to fund a Hospice House that Hope had already built in its own service area. It is reasonable to expect that if awarded a CON, Hope would solicit contributions by sponsoring special events in Collier that would directly compete with HON for a seasonally limited pool of solicited special event and corporate donations. It is also reasonable to expect that corporate and individual donors with a history of giving to HON would instead split hospice donations between Hope and HON. In CY/FY 2006, 71% of the charitable contributions received by HON were from solicited sources. Solicited sources can be divided into three broad categories. Special events accounted for 18% of charitable contributions, solicited corporate underwriting 19%, and direct mail and newsletters 34%. Unsolicited bequests and memorials accounted for the remaining 29% of charitable contributions. Solicited contributions from special events and corporate donations exceeded $750,000. If Hope is awarded a CON, HON's fundraising expert project Hope will reduce solicited donations from special events and corporations, which HON would have otherwise received, by at least one half the first year and potentially more than one half in successive years. While the projection may overstate the immediate reduction in HON's share of solicited donations, it is reasonable to project that HON's share of all solicited donations will be reduced roughly by half at some point not long after Hope received a CON were it to do so. It is logical also to conclude that Hope would compete for and reduce HON's receipts from direct mail and newsletter solicitations. VITAS is a for-profit corporation. It is not likely to compete with Hospice of Naples for charitable contributions from the community. Nor does VITAS' charitable Foundation receive contributions on the scale of Hope. VITAS raises approximately $1 to 1.5 million per year nationwide from its hospice programs, most of which is the result of memorial gifts, rather than community fundraising. It is virtually certain that VITAS' entry into the community will have minimal impact on HON's fundraising efforts. VITAS has committed to working collaboratively with HON to limit the impact VITAS would have on HON's donations. VITAS has agreed, as a condition subsequent to approval of its CON, to provide HON's charitable donation solicitation materials and brochures to VITAS patients and families. VITAS' charitable foundation primarily helps fund and support end of life research, such as the Duke Institute for End-of-Life Care, which benefits all hospices. It is reasonable to expect that if VITAS was awarded a CON, HON would continue to receive much needed solicited donations from direct mail, newsletters, corporations, and special events, in an amount approximating HON's historical solicitations. In sum, an approved VITAS program will have significantly less adverse impact on donations to HON than will an approved Hope program. VITAS' offer to accept as a condition on its CON a requirement that VITAS make HON donation solicitation literature available to VITAS' patients is significant. It confirms a collaborative approach to informing the community. It also gives potential donors a choice: donate to a hospice that uses its donated dollars locally or to one that funds end of life care research and improvement. Different Models of Care VITAS offers a model of care different than that provided by HON or that would be provided in Collier County by Hope. The difference flows from the nature of VITAS' organization as a business. It is a wholly-owned subsidiary of a large, for-profit corporation with national resources, VITAS Healthcare Corporation. VITAS Healthcare Corporation, in turn, is a wholly-owned subsidiary of Chem-Ed, a for-profit corporation that is publicly traded and that engages in business unrelated to hospice with nation-wide scope. Chem-Ed, operates under a business model that seeks to maximize shareholder value and returns. Publicly traded companies often make strategic decisions based upon the stock's performance rather than the business' viability or services provided. Chem-Ed provides its executives at VITAS with performance-based compensation incentives that reward them with bonuses premised upon performance. Chem-Ed monitors the financial performance of its hospice programs with respect to the Medicare spending limit (the "Medicare Cap"). The Medicare Cap is a limit on the total annual payments Medicare makes to a hospice based on the number of first time hospice beneficiaries served by the hospice. The Medicare Cap is intended to ensure that Medicare does not spend more for hospice patients, on average, than for conventional medical care patients at the end-of-life. From Chem-Ed's perspective, hospice programs that operate just below or just above the Medicare Cap optimize profitability. A Medicare provider that exceeds its Medicare Cap must pay back to the government the money it was paid by the government above the cap. In the event that VITAS Healthcare determines that one of its subsidiary programs is going to exceed its cap, there is incentive, especially under a business model of delivering hospice care, to take corrective action. Corrective action could be directed at patient mix and patient admissions. This potential was described at hearing by Hope's expert health planner as: [M]anaging patient mix and admissions from the highest levels of the company for a local program in order to protect the bottom line. And this is without regard . . . to whether or not the needs of the community are being met; whether or not changing the patient mix would enhance or deny access to groups of patients; whether the admission discharge rate and length of stay are appropriate or not. It's all regard to whether the [hospice] program is exposing the [parent] company to a financial risk. Tr. 3034. The business organization context within which VITAS Healthcare operates will provide VITAS with the benefits of economies of scale in a number of its activities. In stark contrast, HON and Hope are two local, not-for-profit, community-based hospice providers. Hope employs a model of care called the Open Access Model because it emphasizes the elimination of barriers to access to hospice care. These barriers may include costliness and the difficulty posed for a patient having to choose between parenteral nutrition and hospice care as described in Hope Ex. 27. The exhibit is an article described by Mr. Cushman as: [S]uggest[ing] that the financial exposure that a hospice assumes when it adopts an open access model of care may be too great to bear for hospice programs that are less than an average daily census of 200. [The article] also discusses some of the issues facing patient and physician who want to refer patients to hospice, as they transition between curative and palliative care, and how open access programs, by providing an easier transition . . . assume a greater cost . . . provide more access to hospice services and lengthen the hospice stay. Tr. 3005-3006. Other barriers include a primary language of the patient other than English, cultural traditions, remote location of the patient's home, lack of access to basic social and health services, lack of information about hospice care, and the reluctance of the attending physician to deal with end-of-life issues. An example of Hope's use of the Open Access Model is its willingness to pay for necessary palliative chemotherapy and radiation therapy when there are no other resources available to a hospice patient to cover such care. Hope's related social and health services such as the Long Term Care Diversion Program enhance access to hospice services in Hope's service area. Employment of the model is reflected in Hope's higher than average hospice penetration rates for Service Area 8C. There are other differences between the approaches to hospice care taken by VITAS and Hope. For example, Hope favors Freestanding Hospice Houses for inpatient care whereas VITAS favors Hospital Dedicated Inpatient Units. Freestanding Hospice Houses vs. Hospital Dedicated Inpatient Units Both freestanding hospice houses and hospital dedicated inpatient units have advantages and disadvantages. See VITAS Ex. 57, Ch. 2, p. 35. VITAS sees Hospital Dedicated Inpatient Units as superior particularly from the viewpoint of doctors and ancillary services. VITAS frequently contracts for dedicated hospital inpatient units. It has never built a freestanding hospice house and does not intend to build one in Collier County. VITAS proposes, instead, to begin providing care in scatter beds in hospitals and then would seek to establish dedicated units when the census justified it. Two Collier County hospitals have indicated intention to enter contracts with VITAS if its application is approved. Naples Community Hospital has done the same. Hope prefers freestanding hospice houses because with a homelike environment they provide a secure and comfortable place for those who prefer not to die at home or who may not have a caregiver at home. Furthermore, consistent with the nature of Hope as a community-based hospice, freestanding hospice houses provide community identity and visibility. Hope operates three freestanding hospice houses to provide GIP and residential hospice services. They are HealthPark (16 GIP beds), Cape Coral (24 GIP beds and 12 residential beds) and Joanne's House/Bonita Springs (16 GIP and 8 residential beds). They are staffed by on-site nurses social workers, aides, therapists, and physicians. Medications and other supplies are available on site. Hospice houses are Hope's primary mechanism for providing inpatient care but it also provides GIP services in a dedicated unit at Shell Point, a SNF/CCRC located in Lee County. Hope developed the polices and procedures in place in the unit and is responsible for managing patient care. The unit is jointly staffed by Hope and Shell Point employees with Shell Point providing the routine nursing care. Even though the unit is dedicated for use by Hope, Hope pays a per diem only for the beds actually occupied by its hospice patients. No costs were incurred by Hope to renovate the space for use as a hospice unit. Hope also provides GIP through a "scatter bed" arrangement with other nursing homes and hospitals within Service Areas 8C and 6B. Hope staff provide daily visits to Hope patients in the hospital setting and regular visits in the nursing homes. Hope staff attend team meetings in nursing homes and ALFs for purposes of reviewing care plans and participating in joint care planning with facility staff. Hope staff also regularly meet with the facility administrators and nurses to obtain feedback on the quality of services provided by Hope. For Collier County, Hope's CON application proposed a mixture of scatter beds in hospitals and nursing homes and to use Joanne's house in Bonita Springs. Just as VITAS intends to resort to its primary mechanism for the delivery of inpatient services once its census in Collier County justifies it, Hope intends to build a freestanding hospice house in Collier County when its census reaches 100 patients. It projects that it will reach such a census in Year 4 of operation. HON operates a freestanding hospice house in Collier County. While it has some scatter beds, most of HON's inpatient care is provided in its hospice house. Hope, in its current operations, builds and utilizes hospice houses as its main mechanism for providing inpatient service. VITAS does not. VITAS provides inpatient service in dedicated units in hospitals. The criteria for a patient to receive GIP are substantially the same as the criteria for continuous care: emergency care or control of acute pain or symptom management. The big difference between the two is where GIP is provided. Inpatient care, for the most part, is provided by VITAS in the hospital. The patient's home is generally the site of where the hospice patient receives continuous care. Aside from the different models of care and approaches to GIP care, there are other differences between Hope and Vitas. VITAS CON Conditions In its application, VITAS offered to condition its CON in the following ways: Conditions of the Application Core Services Provide palliative radiation, chemotherapy and transfusions as appropriate for treating symptoms: It is VITAS Healthcare Corporation's position that these services are a core service as appropriately provided palliative care is a requirement of Medicare conditions of participation. This will be measured via a signed declaratory statement by VHCF which may be supported via review of patient medical records. Provision of hospice services 24 hours a day, seven days a week as indicated by the patient's medical condition: It is VHCF's position this is a requirement of Medicare conditions of participation. This will be measured by VHCF's continued Medicare certification. VHCF will admit all eligible patients without regard to their ability to pay: It is VHCF's position this is a requirement of Medicare conditions of participation. This will be measured by VHCF's continued Medicare certification. Non-Core Services Commit to having every patient being assessed by a physician upon admission to the hospice: This will be measured via a signed declaratory statement by VHCF which may be supported via review of patient medical records. A physician will serve as a member on every care team and provide patient visits as required: This will be measured via a signed declaratory statement by VHCF which may be supported via review of patient medical records. On the first day of hospice care responsive patients will be asked to rate their pain on the 1-10 World Health Organization pain scale (severe pain to worst pain imaginable). A pain history will be created for each patient. These measures will be recorded in Vx via a telephone call using the telephone keypad for data entry. These outcome measures will include greater than 60 percent of patients who report severe pain on a 7-10 scale will report a reduction to 5 or less within 48 hours. Implement a Pet Therapy program to begin immediately: This will be measured via a signed declaratory statement by VHCF. Operational/Programmatic Conditions Establish satellite hospice offices in Immokalee and Marco Island during the first year of operation: This will be measured via submission of the office address and location to AHCA and publication of such addresses in the provider's collateral material. Implement a TeleCare Program to begin immediately: This will be measured via publication of the relevant collateral materials for the provider and patient community. Establish a Local Ethics Committee to begin upon certification: This will be measured via publication of the names and relevant information of the Ethics Committee members and the related scheduled of meetings. Implementation of CarePlanIT, a handheld bedside clinical information system, by the end second year of operation: This is measured by identification of the CarePlanIT budget on Schedule 2 of this application and will be measured at the time of implementation via a signed declaratory statement by VHCF. See VITAS Ex. 1, Tab 5, Summary of Conditions attached to Schedule C of CON 9969. In its PRO, the Agency lists five other conditions1 provided by VITAS: Offer VHCF educational programs to Hospice of Naples staff, physicians and patients. Provide Hospice of Naples Foundation information to VHCF patients and their families seeking to donate funds to hospice services. Upon certification of VHCF Collier, its parent entity - VITAS Healthcare Corporation - will make a $20,000 charitable contribution to Hospice of Naples. 65% Non-Cancer patients. Establish a Clinical Pastoral Education program to begin immediately. Core services are required to be offered by hospice programs. The three conditions in VITAS' application related to "Core Services," therefore, cover services that are not typically subject to conditions since they must be provided whether the application is conditioned upon them or not. The advantage to making them subject to a condition, however, is that the CON holder can be fined for not meeting the condition. The Agency approved the VITAS application and denied the others because in its estimation the VITAS application was clearly superior. See VITAS Ex. 274, Deposition of Jeffrey Gregg, at 16. The decision was described as an "easy call," id., at 17 because no other applicant proposed conditions that were close to the significance of the conditions proposed by VITAS. In its PRO, the Agency continues to maintain that the VITAS' conditions are far superior to those offered by Hope: Hope's conditions, by contrast [to those offered by VITAS], were less impressive: Hope Hospice will open an office in Naples and an office in Immokalee during the first year of operation. Hope Hospice will conduct education and outreach programs in Collier County aimed at enhancing access to the population under 65 and to cancer patients who require palliative therapies. Hope Hospice will implement an emergency preparedness plan capable of maintaining the hospice admissions function during hurricane emergencies. To show conformance with the condition related to office locations, Hope Hospice will forward to the Agency copies of the business licenses and/or certificates of occupancy that who that Hope Hospice has occupied office space in Naples and in Immokalee in Service Area 8B during the first year of operation. Hope Hospice will also forward to the Agency copies of educational and outreach programs and attendance sheets that document efforts to enhance access to the population under 65 and to cancer patients who require palliative therapies. Hope Hospice will also forward to the Agency copies of its emergency preparedness plan for Service Area 8B. Recommended Order Proposed by the Agency for Health Care Administration, at 8, paragraph 26. Experienced Staff/Industry Leaders Many VITAS employees have 15-20 years of hospice experience, including employees in positions of leadership. VITAS' management team consists of recognized leaders in the hospice industry. Its founders were founding members of the National Hospice and Palliative Care Organization (NHPCO). VITAS has maintained an active leadership within the organization. VITAS' employees serve on a number of significant NHPCO committees. They have actively participated in shaping NHPCO's guidelines on a multitude of topics and are frequent lecturers at NHPCO conferences. The size of VITAS allows it to attract and recruit high caliber physicians, RNs, social workers and chaplains. Ability to grow within the company allows VITAS to retain its best employees. Extensive Education and Training Resources VITAS' economies of scale have allowed it to amass extensive hospice internal and external education materials. VITAS has developed unique training materials for staff. It has also developed specific physician and easy to understand community educational materials for patients and families. Many educational materials are translated into other languages including Spanish. All of VITAS materials are easily accessible on VITAS Intranet Service. VITAS, because of size, is able to dedicate significantly more resources to staff education and training than most hospices. VITAS has a significant distance learning program, as well as ongoing dedicated corporate personnel that visit local programs for training. It also maintains teaching affiliates with universities and community colleges for residency and fellowship training of RNs, physicians, and other healthcare professions. Among its training and education efforts is the coordination of specialized training. For example, Dr. Kinzbrunner has dedicated substantial time to writing the Jewish Hospice Manual and traveling to various programs to help educate them to become certified by the National Institute for Jewish Hospices. Similarly, Colonel Jaracz's full-time responsibility is to formulate VITAS' Choices for Veterans initiatives and visit local programs to ensure they are carrying out these initiatives. VITAS places a great deal of emphasis on educational materials for the patient and family. Hope has a different philosophy, at least at the time of admission. On some occasions Hope might provide brochures related to specific therapies if the patient will be receiving them at home. Usually, however, Hope limits the educational materials it provides at admission to a single brochure about Hope Hospice in general. As Toni Granchi, Professional Relations Coordinator for Hope Hospice, explained in her deposition: "I don't want to inundate them with a bunch of brochures . . . . I don't want to give them everything on the first visit. It's very overwhelming." Hope Ex. 152, at 9-10. In contrast to Hope's approach at the difficult moment of admission to hospice, VITAS sees "reinvesting in the materials that will improve [VITAS'] care and educate the family [as] critical." Tr. 116. Whichever approach is superior, the extent of VITAS' educational materials that would be available in Service Area 8 if VITAS is approved will add a new dimension to hospice education in Collier County. Dedicated New Start Team VITAS has had a dedicated start up team since 2002. This group is headed by Executive Vice President Deirdre Law, an RN with more than 20 years of hospice experience. The team includes several RNs with extensive hospice experience. They train clinical managers, ride with new hire nurses and provide patient care until the new nurses demonstrate competency. An example of the work of the VITAS start up team was offered at hearing by Kathy Laporte, VITAS' Senior General Manager for the Brevard and Volusia County programs. When VITAS' program started in Brevard County, a patient care administrator helped Ms. Laporte learn VITAS' policies, procedures and support tools. Support was offered to the business manager and in managing continuous care. The start-up team stayed with the Brevard Program until the program could be sustained without them, for "about a year." Tr. 1224. The success of the VITAS start- up team is demonstrated by VITAS' growth in five years to become the largest provider in the Brevard market despite competition from three exiting providers, two affiliated with hospitals. In addition to the full-time dedicated start-up team, VITAS uses specialized personnel who are active in new start programs. Among them are Sarah McKinnon who provides start-up services in general staff education, Dr. Kinzbrunner in Jewish hospice training and certification and medical directorship, Colonel Jaracz in Veteran training and outreach, Robin Fiorelli in bereavement and volunteer services and Mike Hansen in IT services. VITAS start up teams and specialized start-up services have had significant new start experience in opening hospices in a number of competitive environments. It has opened 20 programs in the last five years, three in Florida. VITAS has never had a start-up program fail. As a community-based hospice much smaller relative to VITAS, Hope has not had start-up experience comparable to that of VITAS. Its one new start is in Service Area 6B. In its CON application, Hope had projected 321 admissions in Year 1. In its first year of operation, Hope achieved 92 admissions. Service Area 6B is Hope's only experience in a competitive market because it is the only provider of hospice services in Service Area 6C. Advanced Information Technology Because of the strength of its financial resources, VITAS has been able to invest $10 million into its customer computer system called Vx or "VITAS Exchange." The system allows it to perform patient analysis and research studies that improve hospice care. After testing in the Fall of 2007, VITAS will begin to roll out VxNext to make Vx more user friendly allow the gathering of more detailed patient information. A technology refresher to Vx, VxNext requires an investment of $13 million. The latest VITAS Information Technology (IT) project is CarePlanIT, a customized care planning system and electronic medical record. Currently 14 hospice programs, about one in three VITAS programs, are operational on CarePlanIT. The rollout of CarePlanIT has been going on for about three years. Increase in the percentage of VITAS hospice programs over those years has been slowed by the addition of so many new VITAS programs in the past five years. VITAS reasonably conditioned its CON on having CarePlanIT operational in Collier County by Year 2. Hope uses an "off-the-shelf" system, Misys, for its medical records. Unlike CarePlanIT customized for VITAS, Misys was not customized for Hope; nor is it specifically designed for hospice. Put simply, Hope's system is not "leading edge" information technology like CarePlanIT. Customized, leading edge, information technology is too expensive for Hope, as one would expect for a community-based hospice. Telecare VITAS' Telecare system is a centralized call center that answers the telephone calls for VITAS' programs after hours. There are several advantages to Telecare. Clinicians are available to answer questions immediately. The system uses defined criteria to determine if an after hours visit should be made. It divides responsibility between the decision-maker as to whether an after hours visit is needed and the RN who actually makes the visit. This division is advantageous because after hours care occurs at a time that is regarded by many as inconvenient. When the decision is made to undertake a visit, the local on-call RN is dispatched immediately. Many of VITAS' clinicians at the call center are fluent in Spanish and other languages minimizing the barrier that language can be at a moment of stress. Disaster Capability VITAS' IT systems have built-in redundancy. The main site is in a bunker in Miami above the 100 year floodplain in a facility that had been an AT&T switching center. The walls are three feet thick concrete. In addition, VITAS is running concurrent dual systems in Chicago and has 100% redundancy for all systems in a bunker in Phoenix, Arizona. The Miami site has generator capacity to run for two weeks without power but could be switched to Phoenix with little to no down time in the event of a disaster. VITAS' size gives it the advantage of the ability to bring in clinical personnel from other parts of the country should there be a disaster that displaces some staff. Outreach Programs There are no existing hospice outreach programs for the Jewish population in Collier County, but the special needs of Collier County Jewish hospice patients are being served by HON. Dr. Kinzbrunner championed the Jewish hospice initiative for VITAS. At hearing, he offered reasons why some Jewish people might be less likely to utilize hospice service than non-Jewish people. Through its educational and training programs, VITAS teaches staff to be sensitive to Jewish cultural and religious issues including understanding specific Jewish customs and traditions. VITAS also makes an effort to reach the Hispanic populations in the areas it serves. It has a significant number of Spanish speaking staff. Its experience in South Florida and Texas consists of work with highly concentrated Hispanic populations. Furthermore, VITAS offers all of its standard hospice forms and much of its educational materials in Spanish. The African American population in Collier County is not as high as other parts of the state; it constitutes 20,000, just less than 7% of the population. VITAS' efforts to educate and reach into minority communities is significant. Its staff is recognized in the industry as providing substantial resources to increase minority access to hospice. Collier County has a significant population of Veterans. The Department of Veteran Affairs has determined that in recent years the number of Veterans' deaths in the county has been approximately 1550 annually. Veterans have special needs at the end of life. These include unique psychosocial needs related to military service, retrieval and obtaining military awards and medals and coordination of military benefits to which patients and families may be entitled. VITAS has a well-developed, detailed program targeted to meet the special needs of veterans. Hope makes an effort to recognize and serve the special needs of Veterans as well. Its psychosocial staff must participate in a special training program designed to educate the staff on the needs of Veterans. Its "Wounded Warrior" program sensitizes Hope staff to the special needs of combat veterans as opposed to those who did not experience combat, the psychosocial needs of veterans of different wars, the special needs of women veterans and special needs of veterans suffering from post-traumatic stress disorder. Hope staff and volunteers, many of them veterans themselves, are trained to build a rapport with Veterans and to help them deal with guilt, anger and anxiety when associated with the Veteran patient's service. Hope regularly reaches out to the Veteran population through local veterans organizations such as the Veterans of Foreign Wars. The special needs of its patients who are Veterans are provided for in a number of other ways as well by Hope. HOPE Required Services Hope provides all of the required Medicare core services directly through its employees, including physicians. It also provides all of the required Medicare non-core services. Unlike some hospices, Hope provides home health aide services and homemaker services directly through its employees in order to better assist its patients and their families. Complementary Therapies Hope offers complementary therapies that enhance the quality of care and the quality of life for hospice patients. Hope offers music therapy through its six licensed music therapists. Other complementary therapies offered by Hope are art therapy, pet therapy and aromatherapy. Hope also offers massage therapy as part of its holistic approach to the care of its patients. Massage therapy can reduce the amount of pain medication that a patient requires and can help alleviate other symptoms as well. Non-required Services In addition to the required core and non-core services, Hope provides non-required services to its patients. They include residential care, a caregiver program for patients who do not have a caregiver at home or whose caregiver at home is not able to provide necessary home care services, and grief services beyond the scope of hospice bereavement services. Other non-required services offered by Hope include the "Dream a Dream" Program. Through this program, Hope patients with a final wish are assisted in making it a reality. Examples include fishing in a private fishing pond, providing plane tickets for far away loved ones to visit the hospice patient, and holding a wedding in the hospice house chapel to enable the Hope patient to attend. Hope has also provided funds for home improvements to make a patient's home more comfortable, providing memorial services conducted by a Hope chaplain at a Hope chapel free of charge to the family of a Hope patient. Hope exceeds the Medicare COP requirement that volunteers provide 5% of patient care. It has done so through special volunteer programs that include "vigil volunteers" sitting at the bedside of the patient, "video volunteers" who make video and audio remembrances for the family and "personal treasure volunteers" who make keepsake items for the family from an article of the patients clothing. Hope offers classes in Continuing Education (CEUs) to all nurses and social workers in the community. It has conducted workshops on coping with grief and loss during the holidays and presentations by Rabbi Kushner on loss and issues related to death and dying. Since 1990 Hope has offered an annual bereavement camp for children aged 6 to 16. The weekend camp is attended by about 70 children from across southwest Florida. Hope sponsors numerous programs designed to educate the physician community about hospice and special programs to help the community deal with specific tragedies or life events. These have included programs for families of service men and women deployed to the Middle East, a 9/11 support group and programs for persons dealing with stress and loss caused by hurricanes. Community Services and Programs Hope provides other community services not required for Medicare certification that are also not provided by HON or VITAS. Hope Life Care is a long term care diversion Medicaid-waiver program Hope provides together with AHCA and the Florida Department of Elder Affairs. PACC is a program for all-inclusive care for children who have a life-limiting illness but may not be eligible yet for hospice. Located in central Lee County, the HOPE Adult Day Health Center is available for elders who cannot be at home by themselves during the day and require a setting with limited supervision. Funded through the Area Agency on Aging, HOPE Connections is a continuing care for the elderly program designed to help frail elderly continue to live in their homes and avoid being admitted to a nursing home or hospital. These community-based non-hospice programs are consistent with Hope's mission of assisting all in need, especially the frail and the elderly who may not qualify for hospice services, across different levels of care that best meet their needs. They also enhance continuity of care for the those who ultimately qualify for hospice care and receive it from Hope. Hope's Clinical Services Hope has received numerous awards in recognition of the excellent quality of care it provides. There are other outward signs of the excellence of its quality of care. For example, it completed its most recent Medicare/Medicaid certification survey with no deficiencies. Hope is accredited by the Community Health Accreditation Program (CHAP) although not by JCAHO. CMS relies upon CHAP certification for participation in Medicare and Medicaid programs. Hope chose to seek accreditation through CHAP rather than JCAHO because of its view that CHAP's accreditation process is more stringent and comprehensive. Hope exceeds the voluntary standards established by NHPCO. It is also a participant in the NHPCO Quality Initiative, which requires a self-assessment as well as other activities related to quality assurance. Hope places emphasis on an individualized approach to every patient and family members over making printed materials available. Hope staff spends time with patients and family in order to establish an individualized plan of care. Hope's Admission Process Hope's Care Resources Department has a staff of 16 who handle the intake of patient referrals to hospice. The Department handles initial inquiries and coordinates the collection of medical records and the physician's order that certifies the patient's condition as terminal. This admission process ensures that the patient meets Medicare eligibility guidelines. All calls pertaining to patient referrals are taken by Hope immediately. Staff typically responds to a referral within 24 hours of request for services. After normal working hours and on weekends and holidays, the After Hours Triage Staff of local registered nurses responds to a referral as well as answering questions of families and dispatching staff, including on-call physicians, as needed. The referred patient is assigned to an inter- disciplinary care team (the "IDT Team") that will provide care for the admission visits, development of the patient's plan of care, and care thereafter. Having the IDT Team conduct admission visits provides the advantage of continuity of care. It fosters early development of a relationship between the IDT and the patient and family and promotes arrangements for the unique and special needs that a patient and family may have. Hope's Medical Team Hope's Medical Director, Mary Stegman, M.D., is board-certified in Hospice and Palliative Medicine, Pain Management and Internal Medicine. She is board-eligible in Hematology-Oncology. Hope employs five physicians other than Dr. Stegman including Dr.Guercio who is board- certified in internal medicine. Dr. Guercio is also board- eligible in pulmonary medicine and serves as the medical director of Joanne's House and the physician on one of Hope's IDT teams. Hope employs ten part-time physicians, including a surgical and pediatric specialist. Dr. Lipschutz is board certified in Hospice and Palliative Care Medicine. A liaison as needed to facilitate patient care discussions between Hope staff and community physicians, Dr. Lipschutz has been involved with Hope since 1992. Hope provides several different types of therapies not provided by other hospices. It has developed evidence-based algorithms for the care of its patients. They include specific clinical pathways or protocols for dealing with specific diseases or symptoms. Veteran Care All of Hope's psychosocial staff must participate in a special training program designed to educate them on the special needs of veterans. The "Wounded Warrior" program sensitizes Hope staff to the special needs of combat vs. non-combat veterans, the psychosocial needs of veterans of the different wars, women veterans, and veterans suffering the effects of post- traumatic stress disorder ("PTSD"). Hope staff and volunteers (many of whom are themselves Veterans) are trained to build a rapport with these veterans and to help them address the feelings of guilt, anger, and anxiety they may have. In addition, Hope nurses are trained to recognize the physical symptoms of patients with PTSD (such as terminal restlessness) and in effective methods to treat such symptoms. All of Hope's veteran patients are presented with a personalized certificate of appreciation and "Thank You letter" from Hope's CEO in a formal ceremony honoring their service to our country. Hope regularly reaches out to local veterans organizations such as the VFW and Knights of Columbus, and provides speakers to educate their members about hospice. Hope is successful in providing for the special needs of its veteran patients. Hope's Pastoral Counseling/Chaplaincy Program Hope employs 15 chaplains who provide spiritual support and counseling to patients and their families. As members of the IDT, Hope chaplains participate in the team meetings, provide resources to patients and families, and serve as an advocate for the patient. Team chaplains regularly consult with other members of the IDT as spiritual issues arise with individual patients or family members. When requested, Hope chaplains also perform memorial or funeral services for Hope patients. Hope chaplains serve as liaisons with community clergy and community leaders, and attend ministerial association meetings. Finally, Hope chaplains provide in-service training for other Hope staff, as well as for community clergy interested in learning about hospice care. All of Hope's chaplains have Masters of Divinity or masters degrees in religious training. All are ordained and certified by their faith group, and all must complete Hope's orientation, clinical training, and mentoring programs. In addition, many of Hope's chaplains have undergone CPE training. Following admission, every patient and the patient's family are visited by the IDT chaplain unless they decline such a visit. The chaplain assesses the spiritual care needs of the patient and family. Hope chaplains do not approach spiritual care in a "cookie cutter" fashion, since even persons of the same faith may have different spiritual needs. Rather, Hope addresses each patient's needs on an individual basis, and strives to meet those specific needs. For example, depending on the patient, Hope chaplains may provide active or passive counseling, life reviews, facilitate the resolution of problems among family members, join in prayer or read scripture. Spiritual care is available to Hope patients on a 24-hour/7-day per week. If a patient requests clergy of a particular faith, the IDT chaplain serves as a liaison to community clergy to ensure that the appropriate clergy visits the patient. Hope's interdenominational chaplains have successfully met the spiritual care needs of patients of a variety of faiths including Buddhism. All of Hope's chaplains are educated and trained in different faiths, including the Jewish faith. When a Hope patient wishes to be attended by a rabbi, those arrangements are made by Hope. Hope has a good relationship with all of the rabbis in its service area and provides excellent care to its Jewish patients. Many local rabbis serve on Hope committees, and some have provided training to Hope staff. Local rabbis also have participated in educational programs which Hope has presented or sponsored which touch upon grieving and mourning in a Jewish context, including lectures by authorities like Rabbi Grolman and Rabbi Kushner. Although Hope at one time sponsored a CPE Program, Hope now sponsors and participates in programs leading to certification by the Association of Death Educators and Counselors ("ADEC"). Persons completing the ADEC program are certified in thanatology (the study of death, dying, grief, and bereavement). Unlike CPE, ADEC certification is not restricted to chaplains, but rather is open to other IDT members, social workers, private therapists, school counselors and other professionals. For these reasons the ADEC curriculum is preferred by Hope over CPE. Hope's Bereavement Services Hope provides a comprehensive array of bereavement and grief counseling services. Each of Hope's IDT's includes a master's level social worker or bereavement counselor trained to assist the patient and family in addressing issues of grief and providing bereavement support. Volunteers who have received special training in helping persons cope with grief and loss are also involved in providing bereavement support. All patients receive a psychosocial assessment at the time of admission, which includes a bereavement assessment. That information is then provided to the IDT, and a determination made as to whether an "anticipatory grief referral" requiring immediate attention is necessary. If so, a counselor will visit with the patient and family within 24 hours to begin assisting the patient and family. Once the patient dies, another assessment is done of the patient's family and loved ones to determine whether early bereavement counseling is required, or whether the normal bereavement process will be followed. Ordinarily, three weeks following death, Hope counselors will contact all persons who have been identified by the IDT as significant in the patient's life to determine whether they would like to receive bereavement counseling, on either an individual or group basis. Letters are sent to family and significant others at 3 weeks, 3 months, 6 months, 12 months, and 15 months following the patient's death. Each of the letters includes an invitation to attend one of the many support group meetings offered by Hope, or to arrange for individual counseling if desired. About 800 persons attend one or more of the Hope-sponsored group sessions each month. Although Medicare guidelines require that bereavement support be provided for up to 13 months following the patient's death, Hope provides bereavement counseling for a minimum of 15 months and for as long as an individual chooses. Hope offers bereavement counseling and grief support to the community at large. This includes the Rainbow Trails Program, a camp for children ages 6 to 16 who have suffered a loss. Hope also offers a Healing Hearts Program which is specifically geared to persons whose loss is the result of a suicide, and another program for persons who have lost a same-sex partner, among others. Hope also offers special crisis response counseling for persons dealing with deaths in school or the workplace. If approved, Hope will provide excellent quality chaplaincy and bereavement programs for its patients in Collier County. Hope's Success in Staff Recruitment and Retention Hope has in its management several people who have obtained certification as Senior Professionals in Human Resources ("SPHR"). SPHR certification assures that these individuals have demonstrated expertise in the core principals of human resource practices such as staff training, development, performance management and assessing current as well as future workforce needs. Hope provides a benefits package which actually attracts new staff to seek employment with Hope. Hope provides quality education to its staff and has supervisory staff certified to assist new staff in achieving accreditation and certification, including certified hospice and palliative care nurses (CHPN). Hope provides cross-training, assistance, and management to avoid burn- out. Hope has considerable experience in recruitment in Southwest Florida. Hope recruits staff through advertising, job fairs and on-site recruiting at local schools. Hope has partnerships with Hi-Tech, Lorenzo Walker, Edison College and Florida Gulf Coast University (FGCU) for developing new nurses and social workers. Hope serves as a clinical site for student interns, who participate in rotations at Hope. These are primarily nursing students, but health care administration, social work and music therapy students also participate. Both Edison and FGCU have campuses in Lee and Collier Counties. HON and Hope currently compete for staff. Healthcare providers in Lee and Collier advertise and compete in both counties to recruit new staff. Hope has some staff living in Collier County. Numbers of staff members have worked for one of the two at one time and the other hospice at another time. The competition would intensify and the overlap increase if Hope's application is approved. Hope also has many employees living in the Bonita Springs area, close to Collier County. One is Dr. Guercio, the IDT physician for Team 100, which would help serve Collier County. He lives in Bonita Springs. Before joining Hope he practiced medicine in Collier County for over 20 years. Hope has not had any difficulties maintaining staff. Hope's salaries are in-line with other local healthcare providers, and Hope could successfully recruit the staff needed for its Collier County program. Hope's Proposed Program for SA 8B Hope will use contract facilities in Collier County for most of the GIP and respite services required by its patients in Service Area 8B. Hope plans to open at least one dedicated GIP unit in a nursing home within Collier County soon after approval of its application. Hope will also be able to enter into contracts for GIP with all four local hospitals. Hope's three hospice houses, moreover, will be available to meet some of the needs of the residents of Service Area 8B for GIP, respite and residential services. Hope has commitments in writing from two hospitals and two SNFs. These contracts will provide for coordinated care whenever a hospice patient is also a nursing home resident or a hospital patient. Hope has inpatient, nursing facility, and ambulatory care service contracts in areas accessible to patients in both Service Areas 8B and 8C. Hope's proposed Service Area 8B hospice program will provide a comprehensive range of hospice services, including physician services, nursing services, home health aide services, social services, and all other services required by state and federal law. Hope will provide services that are not reimbursed by Medicare or other insurance, such as bereavement and chaplain services, massage, music, art, and pet therapies. If approved, Hope will provide the required core and non-core services in its Collier County program as well as the non-required services it now offers in 8C and 6B. Hope currently operates in conformance with Medicare COPs and will do so should its Collier County program be approved. If approved, Hope will establish team offices in Bonita Springs, South Naples, and Immokalee. These locations will provide visibility for Hope's program and increase access to hospice services throughout Collier county. Joanne's House is located in Bonita Springs, less than two miles from the Lee/Collier County line. This new facility will be available and convenient to most northern Collier County patients requiring GIP, residential, and respite care. The IDT assigned to Hope's Immokalee office will serve the entire eastern region of Collier County. This office will be approximately 25 miles from Hope's Lehigh office and therefore convenient if staff are needed to travel between those offices. In addition to servicing the IDT, the Immokalee location will also be available for volunteer training, bereavement support meetings and providing information about hospice. Like Service Area 8C, Service Area 8B is also culturally diverse. As with its Service Area 8C program, Hope will also be successful in addressing the special needs of the culturally diverse communities of Service Area 8B. Hope's startup experience in Collier County will differ from the startup of its Service Area 6B program, where Hope served the more rural areas first. As noted, Lee and Collier counties are contiguous and continuous and Hope already has a substantial presence in Collier County, including its long term care diversion program, staff and volunteers who live there, and the numerous existing relationships with physicians, hospitals, nursing homes, and ALFs. Hope will be even more successful in expanding its hospice program into Collier County. Since they are frequently in Collier County on a regular basis, Hope's key leadership staff are familiar with Collier County and will be available to assist with Hope's Collier startup. If approved, Hope will be successful in implementing its proposed hospice program. Hope has the manpower, expertise and know-how to successfully implement a quality program in Collier County. Community Support for Hope Hope's application is supported by at least 133 local letters of support submitted to AHCA. A number of the letter writers testified by deposition in support of the application. They include hospital CEOs; the CEOs of SNFs, ALFs and other elder services; heads of regional businesses; and other involved in Collier County community organizations. The Lee and Collier County communities are related. The business and residential corridor is continuous between the two counties and there is no visible demarcation between them. Many businesses that operate in Lee also operate in Collier. Over the years, Hope has developed relationships with community leaders whose business serve both counties. Hope has volunteers who live in Collier County and has identified others who would volunteer for Hope if its application is approved. There are several physician group practices with offices and hospital practices in both Lee and Collier County. Hope has relationships with physicians located in Bonita Springs and northern Collier County whose practices include residents of both Lee and Collier counties. These physicians include oncologists, cardiologists, pulmonologists, gerontologists, and family practitioners, many of whom refer patients to Hope. Hope staff are familiar with Collier County health care providers and it enjoys a good reputation in Collier County. Through the Hope Life Care Program, Hope has contracts with two SNFs and seven ALFs in Collier County. A number of Collier County SNFs have transferred patients to Joanne's House. Naples Community Hospital and two HMA hospitals in Collier County have indicated intention to enter contracts for GIP with Hope if its application is approved. Underserved Groups? In its CON Application, Hope identified four groups in Service Area 8B it claims to be underserved. One of the groups is "patients under the age of 65." Hope's proof that the group is underserved consists of a comparison between historical deaths for the group to projected admissions for the group. Although the Hospice Program Rule uses this approach in its formula for calculating the Fixed Need Pool, the approach does not support the conclusion that existing providers have not historically been accessible to a particular demographic cohort or that the group suffers due to a gap in service. As Mr. Davidson opined at hearing, the approach: could suggest that there is [a gap in service]. But the data [relied on by Hope]. . . do not provide any kind of a reliable basis for . . . substantial levels of underservice . . . with rare exceptions. And this case is not one of those exceptions. (Tr. 3698). In order to establish the existence of a service gap using a penetration rate as the measure, it is necessary to compare historical deaths to historical admissions. Hope did not do so. Its comparison of historical deaths to projected admissions renders unpersuasive its claim that patients under the age of 65 are underserved in Collier County. Hope claims there are other underserved groups: (1) cancer patients in need of palliative chemotherapy and/or palliative radiation (PC/PR); (2) residents of the Immokalee area, and (3) patients needing access to hospice services during periods before and after hurricanes. Patients in Need of PC/PR The claim that there is an underserved group of patients in need of PC/PR in Collier County is problematic. The Agency does not have a standard for evaluating the appropriateness of PC/PR; nor is there a standard universally accepted in the hospice industry. In the absence of a standard, the propriety of using PC/PR in any one case, therefore, is up to the clinician. Whether it goes forward, too, is additionally dependent on patient choice. Patient choice requires adequate information and understanding on the part of the patient and family, in other words, "fully informed choice." Hope relies on its level of spending on PC/PR compared to levels of spending elsewhere to support its claim that there is a gap in PC/PR service in Collier County. Hope has spending on PC/PR that is high compared to other hospice programs. Hope attributes the high levels to its Open Access Model of Care, a model that reveals, in its view, need for PC/PR that might not be discovered in service areas without a provider that follows the Open Access Model. Comparing PC/PR delivered in different service areas on the basis of dollars spent or volume of patients receiving PC/PR, however, is not sufficient to show that PC/PR is required more often in service areas in which less is spent on PC/PR. The record in this proceeding does not show that Hope patients were inappropriately provided PC/PR. Nonetheless, it does not support the level of PC/PR service provided to Hope patients either. Hope did not provide case-by-case clinical evidence that its PC/PR service were required. Furthermore, and most significantly, Hope did not submit clinical evidence that patients in need of PC/PR in Collier County did not receive it. Both applicants indicate they will provide PC/PR to patients in need of such service. Only VITAS, however, agreed to a condition of its CON to have patient records audited to determine that receipt of the service was supported by fully informed choice. Immokalee The Immokalee area is a low income migrant community. Predominantly Hispanic, Immokalee also has a Haitian Creole community. Much of the population lacks education. Hope proposes to establish an office in the Immokalee area. It would serve the entire eastern Collier County area and will be a center where people can come for volunteer training, for bereavement support meetings, and for getting information about hospice care. Hope plans to locate an IDT in Immokalee. The IDT will serve the county's eastern region. From a service perspective, HON views Immokalee as part of North Collier County. North Collier County includes north Naples, portions of Bonita Springs located in Collier County, Immokalee, Golden Gate, and adjacent rural areas. North Collier County is served by HON's Central and North Teams. The Central team is a specialty team that sees only patients residing in nursing homes or ALFs. The North Team sees patients receiving home care and who are residing in their homes, halfway houses or anywhere else their home may be. HON has two offices to serve North Collier County; the North Branch Office located about 1/2 miles from the Collier/Lee County line, and an office located in Immokalee. HON's presence in Immokalee, however, has not been constant since it was first initiated. The office had been opened and then closed before being opened again. HON opened the North Branch Office in 2003. It accommodates the North Interdisciplinary Team. The office has two suites, appropriate signage, and ample space to accommodate the IDT and various groups who meet there for bereavement and other events. The geographic location of the North Branch Office is appropriate to allow the team members to reach Immokalee. But it would be a service improvement for an IDT to be located in Immokalee as proposed by Hope. HON's office in Immokalee is located in the Career and Service Center, also known as the "One Stop." The One Stop consists of approximately nine different social service organizations located in one building. The One Stop is considered a key location in Immokalee. Immokalee residents can access the services of the Department of Children and Families, as well as food stamps, Medicaid, employment and vocational-rehabilitation services. By having its office located in the One Stop, people are easily able to access information on end-of-life care services. As a tenant of the One Stop, HON's hospice office has use of the One Stop conferences rooms, which have capacity for over 200 people. HON uses the conferences rooms to hold different functions, such as volunteer training or seminars on coping with the holidays. HON's ADC for the north Collier area is 50-60 patients, and of those, the Immokalee area has an ADC of approximately 6-7 patients. The North Team is staffed and organized to deliver direct hands-on hospice care to Immokalee and adjacent rural areas, especially to the Hispanic population. The North Team includes 5 RNs, two social workers, a chaplain, four home health aides, a volunteer coordinator, a physician, a bereavement counselor, an RN clinical manager, and a clinical assistant. Staffing ratios are 10 patients per RN, which is a more intense level of staffing and patient care than the prevailing NHPCO guidelines of 12 patients per RN. The Team includes an additional RN who is a pediatric nurse specialist and who speaks Creole and Spanish. Seven of the IDT members of the North Team are bilingual. Fluency in Spanish, French, and Creole allows North Team clinicians serving this area to directly communicate with patients, a better alternative than resort to non-clinician employees or telephonic language services. When not deployed in the field visiting patients, the Team uses the north branch office and the Immokalee branch office. Three of the nurses and two of the certified home health aides on the North Team are certified in Hospice and Palliative Care. The sparse populations in large portions of the North Team's service area has not justified in HON's view the addition of a third branch office in North Collier County. All HON patients and families receive a Caregivers Guide, either in a Spanish or English version. In addition to general patient care information, which is reviewed and re-reviewed with the patients and families by IDT members, the Guide includes a number where hospice clinicians can be reached 24 hours a day, 7 days a week. HON's Immokalee office is staffed with a full time community resource coordinator, whose primary function is to support the communities in Immokalee. HON's resource coordinator is the contact person for education, referrals and access to HON's services in Immokalee. She speaks English and Spanish. Another role of the resource coordinator is to provide bereavement support to the community. The resource coordinator facilities a monthly bereavement community support group for grief and loss in Immokalee. She also recruits volunteers from Immokalee. Immokalee residents primarily get their information by word of mouth. HON has been successfully involved in Immokalee social service events, not only to support the community, but also to provide education and information to the different social service organizations and the participants of the programs. HON's presence in Immokalee has made it easier for people to develop a rapport and dialogue regarding the end-of-life care issue. HON's community resource coordinator in Immokalee is an active member of the Immokalee Interagency Council, the Weed and Seed initiative, and the HIV and AIDS Network Coalition for Collier County. The Immokalee Interagency Council consists of over 90 different agencies, which provide services in the Immokalee Community. The Council meets monthly. Their general purpose is to inform the community and the other organizations of their individual services. The Immokalee Weed and Seed initiative is a federal government, juvenile justice initiative that was provided to the Immokalee community to better establish relations between community residents and law enforcement. It is in its fifth and final year. The HIV and AIDS Network Coalition for Collier County is a committee comprised of individuals that come together from different medical and social service organizations to better understand and meet the needs of the Immokalee community. The involvement by HON's community resource coordinator in these important organizations promotes awareness of hospice services. When an emergency such as a hurricane is declared in Immokalee, HON's community resource coordinator reports to the hurricane shelter in Immokalee. Seventy-two hours before a hurricane, she is provided with a list of HON patients. Her role is to maintain contact with HON home care staff, and if they are unable to make contact with a hospice patient during that time, she will physically check on the patient and report back to the main office. All services provided by HON are available to the residents of Immokalee. HON provides information on hospice services to the library, for distribution to the public, on a regular basis. The Immokalee Friendship House is a temporary emergency homeless shelter in Immokalee that serves as a referral source for the community. Annually it assists approximately 1,000 homeless families and individuals. Friendship House has 8 to 15 residents per year who are HON hospice patients. HON has never declined to see a hospice patient at Friendship House or declined to deliver care there. Immokalee Friendship House is completely satisfied with Hospice of Naples. Their clients are well taken care of by HON. From Friendship House's perspective, HON is one of the stronger agencies in Immokalee. HON's community resource coordinator comes to the Immokalee Friendship House for individual and group bereavement counseling. She has also provides bereavement training to the Friendship House staff. Despite HON's efforts toward serving residents of the Immokalee area, they have less access to hospice than do residents of the more urban portions of Collier County. Hope would be able to serve Immokalee through its new local office, through the use of contracted inpatient beds in Lehigh and their planned new hospice house. These locations would provide a real option to hospice patients from Immokalee as evidenced, for example, by travel patterns from the Immokalee area. They trend toward Lehigh and Fort Myers rather than to Naples. Collier Health Services is a not-for-profit primary care provider with multiple locations throughout Collier County. It operates a primary care clinic in Immokalee, provides about half of all services provided AIDS/HIV patients in the county and is part of a program to bring Florida State University medical students to Immokalee for training in rural family medicine. Collier Health Services has indicated a willingness to coordinate care with Hope in the Immokalee community and believes it would be a good relationship based upon past experience with Hope. Hope criticizes HON's commitment to Immokalee because of the lack of a continuous presence there as shown by the opening, closing and the re-opening of its office. But a continuous presence by Hope is not guaranteed either. It conditioned its application on opening "an office in the first year of operation." Hope Ex. 1, Schedule C. To show conformance with the condition, as a special feature of the condition, Hope promised to forward to the Agency copies of the business license and/or certificate of occupancy that show occupation of office space in Immokalee during the first year of operation. Neither the condition nor the special feature of the condition guarantees that Hope's office in Immokalee will be present after the first year of operation. Nonetheless, Hope's presence if continuous, would aid and enhance effective service of the Immokalee community's hospice needs. Hope conditioned its application on having an office in Immokalee but so did VITAS. Unlike VITAS, Hope has a history of serving rural areas in Florida. However much Hope's presence would enhance service to the Immokalee area, the evidence is unpersuasive that the Immokalee area is underserved. HON efforts to serve the Immokalee area are effective. Patients in Need of Service When Disaster Strikes Hope's claim that there have been underserved patients in Collier County in times of disaster is based on events associated with Hurricane Wilma. The eye of Hurricane Wilma made landfall just south of Naples in Collier County on October 24, 2005. The impact of the storm was greater in Collier County than it was in Lee County. More services were interrupted and more people were without power and transportation in Collier County than in Lee County. In Collier County, "all of the government services and most community agencies, physicians' offices, . . . were shut down and . . . went into lockdown mode." Tr. 3462. During the hurricane and in its wake, HON continuously operated the Georgeson House. It accommodated the needs of 23 patients who were relocated to the House right before the arrival of the storm. The Georgeson House is rated to withstand a Category 4 hurricane and can accommodate up to 32 patients with all the equipment, supplies and staff to support those patients in an emergency. In the event of evacuation, HON has an agreement with Physicians Regional Hospital, about 1/8th of a mile from Georgeson House to relocate the patients to hospital beds. For a five-day period, two days before the arrival of the hurricane, the day of the storm and the two days after, HON received no referrals. Consequently, it admitted no patients from October 22 through October 26, 2005. Had it received referrals during the five days, HON was accessible and had the ability to admit patients. On the day the hurricane made landfall and for the two days afterward, in addition to the service provided at the Georgeson House, HON contacted its patients by telephone. As soon as the authorities allowed road travel, HON was able to visit its patients. It visited the majority within 48 hours of the storm event. Hope admitted approximately 20 patients during the same five-day period. In Lee County, there was only a short time that Hope was not able to admit or visit patients. It ended shortly after Hurricane Wilma made landfall when the emergency operations center announced that road travel was safe. Hope has a detailed Disaster Management Plan. See Hope Ex. 1, CON 9967 Vol. 2, Supplementary Appendices, Tab 22. In the event of a Disaster Watch, the plan dictates, "Admissions to Hope Hospice and Hospice Houses will be discontinued." Id., I. Disaster Watch, 1. e. iii. There is no persuasive evidence that had Lee County suffered the same impact that Collier County did from Hurricane Wilma that it would have been able to respond any better than HON did in October of 2005. There is, in short, no evidence that there has been unmet need for hospice services by disaster victims in Collier County. Utilization Projections and Financial Feasibility Each Applicant's projected utilization appears reasonable and achievable. Each applicant demonstrated short-term and long- term financial feasibility. Medicaid Patients and the Medically Indigent Both Hope and VITAS have documented a history of service to Medicaid and medically indigent patients. Hope will serve Medicaid patients and the medically indigent if its application is approved. So will VITAS.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Agency for Health Care Administration approve CON 9969, an application for a new hospice program in Service Area 8B filed by VITAS Healthcare Corporation of Florida, and deny CON 9967, an application for a similar program filed by Hope Hospice and Community Services, Inc. DONE AND ENTERED this 3rd day of March, 2008, in Tallahassee, Leon County, Florida. S DAVID M. MALONEY 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 March, 2008
The Issue Whether there is “an error in the Fixed Need Pool numbers” for hospice as calculated by the Agency for Health Care Administration (“AHCA”) pursuant to Florida Administrative Code Rule 59C-1.0355(4)(a), and as published by AHCA on February 5, 2021, pursuant to rule 59C-1.008(2)(a).
Findings Of Fact Based upon the credibility of the witnesses and evidence presented at the final hearing and on the entire record of this proceeding, the following Findings of Fact are made: The Parties AHCA is designated as the single state agency for the issuance, denial and revocation of certificates of need (“CONs”), including exemptions and exceptions in accordance with present and future federal and state statutes. Suncoast is a licensed hospice program serving HSA 5B, which is comprised entirely of Pinellas County. As an existing hospice provider in HSA 5B, Suncoast is substantially affected by the publication of the FNP at issue in this proceeding and has standing to challenge “an error in the Fixed Need Pool numbers” as set forth in rule 59C-1.008(2)(a)2. Seasons is also a licensed hospice program serving HSA 5B. As an existing hospice provider in HSA 5B, Seasons is substantially affected by the publication of the FNP at issue in this proceeding and has standing to challenge “an error in the Fixed Need Pool numbers” as set forth in rule 59C- 1.008(2)(a)2. Cornerstone is an applicant for a CON for a new hospice program in HSA 5B predicated, at least in part, on the publication of the FNP under challenge in this proceeding. Cornerstone is substantially and adversely affected by the potential change of the FNP from a determination of need for a new hospice program to no need for a new hospice program in HSA 5B, and therefore has standing to intervene in this proceeding. HPH is an applicant for a CON for a new hospice program in HSA 5B predicated, at least in part, on the publication of the FNP under challenge in this proceeding. HPH is substantially and adversely affected by the potential change of the FNP from a determination of need for a new hospice program to no need for a new hospice program in HSA 5B, and therefore has standing to intervene in this proceeding. VITAS is an applicant for a CON for a new hospice program in HSA 5B predicated, at least in part, on the publication of the FNP under challenge in this proceeding. VITAS is substantially and adversely affected by the potential change of the FNP from a determination of need for a new hospice program to no need for a new hospice program in HSA 5B, and therefore has standing to intervene in this proceeding. AHCA’s Calculation and Publication of the Fixed Need Pool As part of its responsibilities under the CON laws, AHCA is required to establish, by rule, uniform need methodologies for CON-regulated health facilities and services. Those need methodologies must take into account “the demographic characteristics of the population, the health status of the population, service use patterns, standards and trends, geographic accessibility, and market economics.” § 408.034(3), Fla. Stat. Rule 59C-1.0355 codifies the uniform need methodology that applies to hospice programs. The rule defines twenty-seven (27) service areas, and AHCA uses the need methodology in rule 59C-1.0355(4)(a) to calculate numeric need for hospice programs for each of the 27 HSAs. The results of those calculations determine whether there is an FNP of one, or zero, in each of the 27 HSAs. Typically, AHCA publishes need projections for hospice programs twice per year in “batching cycles.” See Fla. Admin. Code R. 59C-1.008(1)(g), (2)(a).1,2 Rule 59C-1.008(2)(a) allows parties to identify purported “errors” in the FNP numbers published by AHCA: Any person who identifies an error in the Fixed Need Pool numbers must advise the Agency of the error within 10 days of the date the Fixed Need 1 As explained below, AHCA cancelled the CON Hospital Facilities and Hospice 2nd Batching Cycle for 2020. 2 Although AHCA typically publishes need projections for hospice programs twice per year, Florida law requires only one FNP publication per year. See § 408.039(1), Fla. Stat. (“The agency by rule shall provide for applications to be submitted on a timetable or cycle basis; provide for review on a timely basis; and provide for all completed applications pertaining to similar types of services or facilities affecting the same service district to be considered in relation to each other no less often than annually.”). (emphasis added). Pool was published in the Florida Administrative Register. If the Agency concurs in the error, the Fixed Need Pool number will be adjusted and re- published in the first available edition of the Florida Administrative Register. Failure to notify the Agency of the error during this time period will result in no adjustment to the Fixed Need Pool number for that batching cycle. Except as provided in subparagraph 2. above, the batching cycle specific Fixed Need Pools shall not be changed or adjusted in the future regardless of any future changes in need methodologies, population estimates, bed inventories, or other factors which would lead to different projections of need, if retroactively applied. Fla. Admin. Code R. 59C-1.008(2)(a)2. and 3. It is undisputed that AHCA’s rules do not define “error” as that term is used in rule 59C-1.008(2)(a)2. Although there is no definition of the word “error,” AHCA limits its interpretation of the word to only “mathematical” errors or late-filed hospice admissions by Florida licensed hospice programs pursuant to rule 59C-1.0355(8). Petitioners’ Fixed Need Pool Challenge On February 5, 2021, AHCA published an FNP for one new hospice program in HSA 5B. Suncoast timely advised AHCA in writing of two purported errors it had identified in the FNP. Specifically, Suncoast asserted that: (1) AHCA’s calculations incorrectly predict future need based upon a spike in admissions caused by the COVID-19 pandemic that will not exist when the planning horizon arrives3; and (2) AHCA has not accounted for actual hospice admissions by VA hospitals that provide hospice care in Pinellas County. 3 Even before AHCA’s publication on February 5, 2021, Suncoast requested that AHCA suspend the Hospital Facilities and Hospice 1st Batching Cycle for 2021, citing the COVID-19 pandemic. Seasons Pinellas also timely advised AHCA in writing of the same two purported errors in the FNP. On February 17, 2021, AHCA issued separate but identical responses to Suncoast and Seasons Pinellas, stating that “the published need is correct and a revision to the fixed need pool is not warranted.” The Hospice Need Methodology Under AHCA’s hospice need methodology, numeric need for an additional hospice program is demonstrated if the projected number of unserved patients who would elect a hospice program is 350 or greater. The net need for a new hospice program in an HSA is calculated as follows: Numeric Need for a New Hospice Program. Numeric need for an additional Hospice program is demonstrated if the projected number of unserved patients who would elect a Hospice program is 350 or greater. The net need for a new Hospice program in a service area is calculated as follows: (HPH) -- (HP) = 350 where: (HPH) is the projected number of patients electing a Hospice program in the service area during the 12-month period beginning at the planning horizon. (HPH) is the sum of (U65C x P1) + (65C x P2) + (U65NC x P3) + (65NC x P4) where: U65C is the projected number of service area resident cancer deaths under age 65, and P1 is the projected proportion of U65C electing a Hospice program. 65C is the projected number of service area resident cancer deaths age 65 and over, and P2 is the projected proportion of 65C electing a Hospice program. U65NC is the projected number of service area resident deaths under age 65 from all causes except cancer, and P3 is the projected proportion of U65NC electing a Hospice program. 65NC is the projected number of service area resident deaths age 65 and over from all causes except cancer, and P4 is the projected proportion of 65NC electing a Hospice program. The projections of U65C, 65C, U65NC, and 65NC for a service area are calculated as follows: U65C = (u65c/CT) x PT 65C = (65c/CT) x PT U65NC = (u65nc/CT) x PT 65NC = (65nc/CT) x PT where: u65c, 65c, u65nc, and 65nc are the service area's current number of resident cancer deaths under age 65, cancer deaths age 65 and over, deaths under age 65 from all causes except cancer, and deaths age 65 and over from all causes except cancer. CT is the service area's current total of resident deaths, excluding deaths with age unknown, and is the sum of u65c, 65c, u65nc, and 65nc. PT is the service area's projected total of resident deaths for the 12-month period beginning at the planning horizon. “Current” deaths means the number of deaths during the most recent calendar year for which data are available from the Department of Health, Office of Vital Statistics at least 3 months prior to publication of the Fixed Need Pool. “Projected” deaths means the number derived by first calculating a 3-year average resident death rate, which is the sum of the service area resident deaths for the three most recent calendar years available from the Department of Health, Office of Vital Statistics at least 3 months prior to publication of the Fixed Need Pool, divided by the sum of the July 1 estimates of the service area population for the same 3 years. The resulting average death rate is then multiplied by the projected total population for the service area at the mid-point of the 12-month period which begins with the applicable planning horizon. Population estimates for each year will be the most recent population estimates from the Office of the Governor at least 3 months prior to publication of the Fixed Need Pool. The projected values of P1, P2, P3, and P4 are equal to current statewide proportions calculated as follows: P1 = (Hu65c/Tu65c) P2 = (H65c/T65c) P3 = (Hu65nc/Tu65nc) P4 = (H65nc/T65nc) where: Hu65c, H65c, Hu65nc, and H65nc are the current 12-month statewide total admissions of Hospice cancer patients under age 65, Hospice cancer patients age 65 and over, Hospice patients under age 65 admitted with all other diagnoses, and Hospice patients age 65 and over admitted with all other diagnoses. The current totals are derived from reports submitted under subsection (8) of this rule. Tu65c, T65c, Tu65nc, and T65nc are the current 12-month statewide total resident deaths for the four categories used above. (HP) is the number of patients admitted to Hospice programs serving an area during the most recent 12-month period ending on June 30 or December 31. The number is derived from reports submitted under subsection (8) of this rule. 350 is the targeted minimum 12-month total of patients admitted to a Hospice program. (Fla. Admin. Code R. 59C-1.0355(4)(a)). While daunting in its length and complexity, the methodology can succinctly be summarized as follows: AHCA makes a projection of future hospice need in an HSA which is abbreviated as “(HPH)”; AHCA then subtracts from that projection the actual number of hospice admissions in the HSA, which is abbreviated “(HP).” If the result of that subtraction is 350 or greater, AHCA publishes an FNP for an additional program for that HSA. (HPH) is calculated by determining the projected number of deaths in four categories—(1) cancer, 65 and older; (2) cancer, under 65; (3) non-cancer, 65 and older; and (4) non-cancer, under 65. The methodology then projects the percentage of people within those four categories that would elect hospice care, which is calculated by employing the statewide penetration rate for those four categories to a service area’s community. These penetration rates or, P-values, are calculated by using the entire state’s admissions in each of the four categories divided by the entire state’s deaths in each of those four categories. In calculating the number of deaths for (HPH), the rule calls for AHCA to use data from the most recent calendar year for which data are available from the Department of Health, Office of Vital Statistics, at least three months prior to publication of the FNP. (HP) is calculated by using semi-annual utilization reports that are required to be completed by each licensed hospice program in the state on or before July 20 of each year and January 20 of the following year. “The July report shall indicate the number of new patients admitted during the 6-month period composed of the first and second quarters of the current year” and the “January report shall indicate the number of new patients admitted during the 6-month period composed of the third and fourth quarters of the prior year.” Using this need methodology, the net need for HSA 5B for the July 2022 hospice planning horizon was 414, resulting in a need of one (1) new hospice program in the service area. Because the rule requires death data from the most recent calendar year that was available at least three months prior to the publication of the FNP, AHCA used the final death reports from 2019 in calculating need for the July 2022 hospice planning horizon. However, because the rule requires admissions data from the most recent 12-month period ending on June 30 or December 31, AHCA used admissions from 2020 in calculating need for the July 2022 hospice planning horizon. As pointed out by Petitioners, just 65 more hospice admissions in HSA 5B in 2020 would have resulted in a net need of zero (0) new hospice programs in that HSA for the July 2022 planning horizon. Legal Presumption Created by FNP Determination A positive FNP determination will establish a rebuttable presumption of need. Balsam v. Dep’t of HRS, 486 So. 2d 1341, 1349 (Fla. 1st DCA 1986); VITAS Healthcare Corp. of Cent. Fla., Inc. v. Ag. for Health Care Admin., Case No. 04-3858CON (Fla. DOAH June 14, 2005; Fla. AHCA July 7, 2005). The converse is also true that “[a] lack of numeric need under the rule formula establishes a rebuttable presumption of no need.” Beverly Enter.- Fla., Inc. v. Ag. for Health Care Admin., Case Nos. 92-6656, 92-6659-6662, 92-6669 (Fla. DOAH July 24, 1994; Fla. AHCA Oct. 17, 1994). In a hospice CON case, the absence of numeric need prohibits the approval of a new hospice program unless special circumstances found in the hospice need rule are present, or applicable criteria outweigh the lack of need. See Fla. Admin. Code R. 59C-1.0355(3)(b), (4)(d); Compassionate Care Hospice of the Gulf Coast, Inc. v. State, Ag. for Health Care Admin., 247 So. 3d 99, 101-02 (Fla. 1st DCA 2018). In most cases, the establishment of a positive FNP nearly always results in the approval of a new hospice program, and the determination of zero need results in a denial of all applications. Thus, AHCA’s calculation of hospice need as reflected in its FNP determination will substantially affect each of the parties in this case. Suncoast and Seasons Pinellas have identified two purported errors in AHCA’s need determination: (1) the challenged FNP is based on data that was skewed by the COVID-19 pandemic; and (2) the FNP numbers fail to account for hospice admissions to Bay Pines. Petitioners contend that, in light of these factors, AHCA’s calculation of a net need for one new hospice program in HSA 5B for the July 2022 planning horizon is not accurate. While both of these arguments are cognizable within an FNP challenge, neither is persuasive in this instance, as explained below. Does the Impact of the Pandemic Warrant Use of Updated Deaths Data? In March 2020, a worldwide pandemic erupted due to the outbreak of the novel coronavirus (“COVID-19”). (Office of the Governor, Executive Order No. 20-52 (“E.O. 20-52”)). COVID-19 is “a severe acute respiratory illness that can spread among humans through respiratory transmission and presents with symptoms similar to those of influenza.” E.O. 20-52. On March 9, 2020, Florida Governor Ron DeSantis declared a state of emergency due to the outbreak of COVID-19. E.O. 20-52. The Governor noted that, as of March 9, 2020, “eight counties in Florida have positive cases for COVID-19, and COVID-19 poses a risk to the entire state of Florida.” Id. Upon the Governor’s direction, on March 1, 2020, the State Surgeon General “declared a Public Health Emergency exists in the State of Florida as a result of COVID-19.” E.O. 20-52. The World Health Organization also “declared COVID-19 a Public Health Emergency of International Concern.” Id. On March 15, 2020, the Florida Division of Emergency Management issued an Emergency Order “prohibiting all individuals from visiting facilities within the State of Florida,” including nursing homes, long-term care hospitals, and assisted living facilities. (Div. of Emerg. Mgmt., In Re: Suspension of Statutes, Rules, and Orders, Pursuant to Executive Order Number 20-52, Made Necessary By the COVID-19 Public Health Emergency, DEM Order. No. 20-006 (Mar. 15, 2020)). The CON Hospital Facilities and Hospice 2nd Batching Cycle was scheduled to begin on the third Friday in July 2020. (Fla. Admin. Code R. 59C-1.008(1)(g) (2019).4 However, due to the outbreak of the COVID-19 pandemic, and under the authority of the Governor’s Executive Order, AHCA issued an Emergency Order cancelling the Hospital Facilities and Hospice 2nd Batching Cycle. (AHCA, In Re: Temporary Suspension of Certificate of Need Batching Cycle, AHCA 20-004 (July 17, 2020)). In that Emergency Order, AHCA noted that “all counties in Florida have confirmed cases of COVID-19 that are growing in number daily and straining virtually every health care resource available within the State.” Id. AHCA also considered cancelling the Hospital Facilities and Hospice 1st Batching Cycle – 2021 (the batching cycle at issue here). Although the 4 In December 2020, the Agency issued a new Final Rule changing the dates of the hospice batching cycles. (See Fla. Admin. Code R. 59C-1.008(1)(g) (2020). Under the new Rule, the Hospital Facilities and Hospice 2nd Batching Cycle will begin on the first Friday in August. State of Florida was still under a state of emergency when AHCA announced need for an additional hospice program in HSA 5B, AHCA decided to move forward with the batch because, according to AHCA’s representative, James McLemore, it was “trying to get to a normal.” In deciding not to change or adjust the FNP at issue, AHCA did not compare hospice penetration rates from this batch with any other batch. In other words, AHCA did not compare previous hospice penetration rates to see if the need predictions made in this batching cycle were unusual in any way. Suncoast’s health planning expert, Armand Balsano, testified that if AHCA had examined the hospice penetration rates for this batching cycle with previous batching cycles, it would have noticed a significant anomaly in the FNP numbers used to calculate hospice need for the July 2022 planning horizon for HSA 5B. According to Mr. Balsano, typically, overall hospice penetration rates are very consistent year over year, hovering around .67 or .68 (meaning that 67% - 68% of recorded deaths received hospice care before passing). However, for the February 2021 batching cycle, AHCA calculated that the overall penetration rate had dramatically increased to .727, which Mr. Balsano considered to have a “profound” effect on the FNP calculation. According to Petitioners, because AHCA’s need projections relied on 2020 hospice admissions, which included COVID-19-related hospice admissions, and 2019 deaths, which necessarily excluded COVID-19-related deaths, the data showed a larger spike in hospice admissions than deaths, which caused the overall penetration rate to increase dramatically from prior years. To illustrate the effect caused by using hospice admissions during a year in which Florida (and the rest of the world) was battling a highly contagious virus (2020) and deaths from a year in which the world was not (2019), Mr. Balsano recast the overall penetration rates using 2020 hospice admissions and 2020 deaths. According to Mr. Balsano, when using 2020 hospice admissions and 2020 hospice deaths, the penetration rate actually decreases from AHCA’s overall penetration rate of .727 to .629. When 2020 deaths were substituted for 2019 deaths, and AHCA’s calculated penetration rate of .727 was substituted with the recast penetration rate of .629, the rule need methodology would result in a negative numeric need, and thus, no need for an additional hospice program, according to Mr. Balsano. Mr. Balsano acknowledged that AHCA’s use of deaths from one year and hospice admissions from another year to predict need is not inherently unreliable in projecting future need. Petitioners also conceded that AHCA complied with its rules when it used 2019 death data to calculate the FNP numbers at issue. The parties stipulated that when performing its FNP calculation at issue, AHCA used the number of “current deaths” as defined in, and required by, rule 59C-1.0355(4)(a). The parties further stipulated that when performing the FNP calculation, AHCA used the number of patients admitted to hospice programs serving HSA 5B during the most recent 12-month period ending December 31, 2020, as derived from the reports submitted under rule 59C-1.0355(8), as required by rule 59C-1.0355(4)(a). Petitioners’ alternative FNP calculation is not permitted by rule 59C- 1.0355(4). Rather, it is uncontroverted that when performing its FNP calculations, AHCA used the number of “current deaths” as defined in and required by rule 59C-1.0355(4)(a). Likewise, AHCA used the number of patients admitted to Hospice Programs serving HSA 5B during the most recent 12-month period ending December 31, 2020, as derived from the reports submitted under rule 59C-1.0355(8), as required by rule 59C- 1.0355(4)(a). Moreover, Petitioners’ alternative need calculation is based on provisional death data for calendar year 2020 from the Office of Vital Statistics as of April 3, 2021. This data could not have been available three months prior to the February 5, 2021, publication of the FNP numbers, since calendar year 2020 did not conclude three months prior to February 5, 2021. Despite advocating for the use of 2020 death data, Suncoast’s expert witness did not know whether any 2020 death data, even provisional data, were available from the Office of Vital Statistics by February 5, 2021. Additionally, Mr. Balsano conceded that he did not know if the provisional data he used for his alternative FNP calculation were different from any death data available from the Office of Vital Statistics as of the date of the final hearing. Had AHCA used the provisional death data used by Suncoast’s expert witness in creating Suncoast Exhibits 11 through 20, then AHCA would have violated rule 59C-1.0355(4), and its calculation of the FNP numbers would have been erroneous. While the impacts of the COVID-19 pandemic have been profound and devastating, particularly in the number of individuals who have succumbed to the disease, the effects of the pandemic will, fortunately, be transitory. As of the time of the final hearing, a number of vaccines had become available to protect individuals from COVID-19. AHCA’s witness acknowledged that vaccines developed by Pfizer and Moderna (as well as Johnson and Johnson) have been reported to be very effective in reducing the number of deaths among individuals who have been vaccinated. AHCA further acknowledged that, in part, due to the availability of these vaccines, Florida has seen a significant decline in COVID-19 deaths. Inclusion of VA Hospital Hospice Admissions in the FNP Calculation? Petitioners further argue that AHCA’s failure to consider hospice admissions to VA hospitals has led to an incorrect projection of need under the rule formula. In making FNP calculations for hospice, AHCA only considers admissions to hospice programs licensed by AHCA. Thus, VA admissions are not considered because AHCA does not license VA facilities or programs. However, all deaths are factored into the FNP calculation, including deaths in a VA facility. Petitioners argue that this is an additional error, and created a flawed and unreliable calculation of need in HSA 5B, where there is a significant population of veterans. There are multiple VA hospitals in Florida that operate inpatient hospice units, including Bay Pines. The main facility of the Bay Pines VA system is the C.W. Bill Young Department of Veterans Affairs Medical Center (“CWBY VA Medical Center”) located in Bay Pines, Pinellas County, Florida. The CWBY VA Medical Center is part of the Department of Veterans Affairs, a federal agency. The CWBY VA Medical Center holds no type of health care facility or health services license issued by the State of Florida. The CWBY VA Medical Center is not a “Hospice Program” as that term is defined in rule 59C-1.0355(2)(f). The CWBY VA Medical Center does not report utilization information to AHCA pursuant to rule 59C-1.0355(8). Nor is it required to do so. At hearing, AHCA’s representative confirmed that AHCA lacks jurisdiction over the CWBY VA Medical Center to require it to submit any report to AHCA. It was not clear from the testimony at final hearing what hospice services the CWBY VA Medical Center provides. At most, the facility only provides inpatient end of life services. For example, Suncoast’s Exhibit 6 purported to depict Suncoast discharges to CWBY VA Medical Center during 2020. But Suncoast’s Care Navigator was asked whether she knew “what services specifically any of these patients received while they were at the VA” and she admitted, “I do not.” For “outpatient” or “community” hospice services, the CWBY VA Medical Center refers veterans to a local hospice for admission for hospice services. Although Suncoast tracks patient referrals from the CWBY VA Medical Center, Suncoast did not present any evidence demonstrating that those patients received hospice care at the VA. Suncoast’s expert witness conceded that AHCA followed the requirements of rule 59C-1.0355, by not including VA patient data, and that including such data would be contrary to the rule. Suncoast’s expert witness stated that Suncoast’s argument that AHCA should include any patients receiving hospice services at the VA in the FNP calculation was simply a “conceptual issue,” and that he could not obtain useable data from other VA centers in Florida to create an exhibit that could be introduced into evidence. This “conceptual issue,” which forms a significant part of Suncoast’s allegation that there is an error in the FNP numbers, is essentially the claim that hospice admissions at VA facilities were not counted, while deaths of patients in VA facilities under the VA’s inpatient hospice care were being counted as Florida resident deaths. Suncoast’s expert conceded that he did not know whether these patients had been reported to AHCA as hospice admissions as a result of care they may have received at a state-licensed hospice program, or whether the patients admitted to VA facilities actually died, much less whether they were counted as Florida resident deaths. Indeed, Suncoast’s evidence made clear that it admits patients referred from the CWBY VA Medical Center, and that those patients are included in utilization reports submitted to AHCA under rule 59C-1.0355(8). Suncoast also presented evidence that its hospice patients are frequently discharged for acute care services at the CWBY VA Medical Center, and that Suncoast reports such patients as separate admissions if the patient returns to Suncoast. Suncoast’s witness acknowledged that this results in a single patient being counted as multiple admissions in its utilization reports. Suncoast’s witnesses acknowledged that this discharge and re- admission pattern only occurred with VA patients and would not be the case for patients who were placed on inpatient hospice care in a Suncoast hospice house, or in a hospital or skilled nursing facility. Suncoast’s expert acknowledged that accounting for any VA admissions would change the penetration rate statewide, and as a result, any VA admissions identified in HSA 5B could not simply be subtracted from the total number of projected hospice admissions to recalculate the FNP for HSA 5B. Ultimately, Mr. Balsano could not opine on what the correct need number would have been, and had no idea what the calculated result would have been if the purported VA admissions were counted. Absent reliable data in this regard, there is no basis to deviate from the data source utilized by AHCA in its FNP calculation, even if such deviation was permissible by rule. The existence of potential alternatives to the FNP calculation in rule 59C-1.0355, and in particular the use of different death and admissions data than that used by AHCA, as advocated by Petitioners, is not warranted for the reasons discussed above. Petitioners have failed to carry their burden to establish that the FNP calculations that AHCA made using the rule- required data was in error.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered determining that there is no error in the Fixed Need Pool numbers for Hospice Service Area 5B and that there is a calculated net need for one additional hospice program in Hospice Service Area 5B as published by AHCA on February 5, 2021. DONE AND ENTERED this 16th day of June, 2021, in Tallahassee, Leon County, Florida. S W. DAVID WATKINS Administrative Law Judge 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 16th day of June, 2021. COPIES FURNISHED: Stephen C. Emmanuel, Esquire Ausley & McMullen 123 South Calhoun Street Tallahassee, Florida 32301 D. Ty Jackson, Esquire GrayRobinson, P.A. 301 South Bronough Street, Suite 600 Post Office Box 11189 Tallahassee, Florida 32302 Julia Elizabeth Smith, Esquire Agency for Health Care Administration Mail Stop 3 2727 Mahan Drive Tallahassee, Florida 32308 Eugene Dylan Rivers, Esquire Ausley & McMullen, P.A. 123 South Calhoun Street Tallahassee, Florida 32301 Gabriel F.V. Warren, Esquire Rutledge Ecenia, P.A. 119 South Monroe Street, Suite 202 Post Office Box 551 Tallahassee, Florida 32301 David C. Ashburn, Esquire Greenberg Traurig, P.A. 101 East College Avenue Post Office Drawer 1838 Tallahassee, Florida 32301 Kristen Bond Dobson, Esquire Parker, Hudson, Rainer & Dobbs, LLP Suite 750 215 South Monroe Street Tallahassee, Florida 32301 Karl David Acuff, Esquire Law Offices of Karl David Acuff, P.A. Suite 2 1615 Village Square Boulevard Tallahassee, Florida 32309-2770 Amanda Marci Hessein, Esquire Rutledge Ecenia, P.A. Suite 202 119 South Monroe Street Tallahassee, Florida 32301 Simone Marstiller, Secretary Agency for Health Care Administration 2727 Mahan Drive, Building 3 Tallahassee, Florida 32308-5407 Shena L. Grantham, Esquire Agency for Health Care Administration Building 3, Room 3407B 2727 Mahan Drive Tallahassee, Florida 32308 Michael J. Cherniga, Esquire Greenberg Traurig, P.A. 101 East College Avenue Post Office Drawer 1838 Tallahassee, Florida 32301 Marc Ito, Esquire Law Office of Marc Ito, PLLC 411 Wilson Ave. Tallahassee, Florida 32303 Seann M. Frazier, Esquire Parker, Hudson, Rainer & Dobbs, LLP Suite 750 215 South Monroe Street Tallahassee, Florida 32301 Christoper E. Gottfried, Esquire Greenberg Traurig 101 East College Avenue Tallahassee, Florida 32301 Richard J. Shoop, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 Stephen A. Ecenia, Esquire Rutledge Ecenia, P.A. 119 South Monroe Street, Suite 202 Post Office Box 551 Tallahassee, Florida 32301 James D. Varnado, General Counsel Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 Thomas M. Hoeler, Esquire Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308
The Issue Whether the certificate of need (“CON”) applications filed by Cornerstone Hospice & Palliative Care, Inc. (“Cornerstone”); Suncoast Hospice of Hillsborough, LLC (“Suncoast”); and VITAS Healthcare Corporation of Florida (“VITAS”), for a new hospice program in Agency for Health Care Administration (“AHCA” or the “Agency”) Service Area 6A (Hillsborough County), satisfy the applicable statutory and rule review criteria sufficiently to warrant approval, and, if so, which of the three applications, on balance, best meets the applicable criteria for approval.
Findings Of Fact Based upon the credibility of the witnesses and evidence presented at the final hearing, and on the entire record of this proceeding, the following Findings of Fact are made: The Parties AHCA AHCA is designated as the single state agency for the issuance, denial, and revocation of CONs, including exemptions and exceptions in accordance with present and future federal and state statutes. AHCA is also the state health planning agency. See §§ 408.034(1) and 408.036, Fla. Stat. In addition, AHCA is the agency designated as responsible for licensure and deficient practice surveys for health facilities, including hospices. See ch. 408, Part II and § 400.6005-.611, Fla. Stat. Pursuant to Florida Administrative Code Rule 59C-1.0355(4)(a), the Agency established a numeric formula for determining when an additional hospice program is needed in a service area. The Agency's need formula determined a need for one new hospice program in SA 6A in the application cycle at issue. That determination is unchallenged. None of the applicants argued that more than one new hospice program should be approved for Hillsborough in this cycle. Suncoast The Hospice of the Florida Suncoast (“Suncoast Pinellas”) was founded in 1977, and was one of the first hospices in Florida, and in the nation. Although it operates only in Pinellas County, Suncoast Pinellas has grown to become one of the largest nonprofit hospices in the country. Suncoast Pinellas is a subsidiary of Empath Health (“Empath”), which also provides a number of non-hospice services. As discussed further below, Empath is currently undergoing a merger with Stratum Health System (“Stratum”), which operates Tidewell Hospice in Sarasota and Manatee Counties. The Chief Executive Officer (“CEO”) of Empath and Suncoast Pinellas is Rafael Sciullo. Mr. Sciullo was recruited to be CEO of Suncoast Pinellas in 2013, where he has served ever since. When Mr. Sciullo arrived at Suncoast Pinellas, the company operated a human immunodeficiency virus (“HIV”) testing and treatment program, a PACE program, a home health program, and a palliative care program. Mr. Sciullo became concerned that patients in the HIV, PACE, and home health programs were not comfortable hearing the word “hospice,” as those patients did not view themselves as hospice patients. Mr. Sciullo reorganized Suncoast Pinellas by creating Empath in order to alleviate this concern with a more inclusive and mission directed organization. Empath is an administrative services provider that provides support to its affiliates, which include Suncoast Pinellas, Empath Partners in Care (“EPIC”),2 Suncoast PACE, Suncoast Hospice Foundation, and programs for palliative care, pharmacy, durable medical equipment (“DME”), and infusion services. Through its affiliates, Empath already provides several services within Hillsborough, including EPIC HIV services and support, and palliative care. The federal definition of hospice care requires a prognosis of a six- month or less life expectancy. However, Florida’s definition permits patients with a 12-month prognosis. Under its supportive care program, Suncoast Pinellas offers hospice services to patients with a prognosis of six to 12 months. As one of the largest not-for-profit hospices in the nation, Suncoast Pinellas offers specialized programs for veterans, the Jewish population, African Americans, the Hispanic population, and disease groups such as heart failure, Alzheimer’s, and COPD. The applicant entity for the CON is Suncoast Hospice of Hillsborough, LLC. If approved, Suncoast will appear beside Suncoast Pinellas in Empath’s organizational chart, operating as a subsidiary under the Empath Health, Inc., family of companies. Empath has entered into a Memorandum of Understanding with Stratum to merge the two organizations. The merger has not yet been accomplished; the companies are currently in the process of conducting due 2 Empath’s EPIC program provides programs and services to persons impacted by HIV and AIDS throughout the Tampa Bay area. diligence. However, the two companies have already agreed that if the merger is consummated, Mr. Sciullo will serve as the CEO of the merged entity, and will be in charge of both original entities after the merger. According to Mr. Sciullo, the merger will not distract or otherwise serve as an impediment to Suncoast’s plans to implement its new hospice program in Hillsborough. Cornerstone Cornerstone is a 501(c)(3) community-based, not-for-profit entity, founded in 1981 by compassionate nurses in Eustis, Florida, to care for patients during their last days of life. Licensed in 1984, Cornerstone (formerly, Hospice of Lake and Sumter, Inc.) has since grown to serve three hospice service areas (3E, 6B, and 7B) which encompass seven central Florida counties, including Polk County, which is contiguous to Hillsborough. Cornerstone has spent more than 35 years serving tens of thousands of patients and their loved ones in the Central Florida region. As a local, not-for-profit hospice, Cornerstone’s governing body is comprised of leaders from the communities it serves, and its board would be expanded to include new members from Hillsborough. This fosters local accountability to the populations Cornerstone serves. Due to its not-for-profit status, Cornerstone is also legally and ethically bound to benefit its communities, and its earnings are reinvested locally rather than inuring to the benefit of private owners. The Cornerstone Hospice Foundation is an independent, 501(c)(3), nonprofit foundation led by community volunteers. The purpose of the Foundation is to raise money for Cornerstone’s community programs, hospice houses, and for people with no method of paying for hospice. Cornerstone Health Services, LLC, is an affiliated entity which provides non-hospice palliative care services to patients. Cornerstone also includes Care Partners, LLC, which is a consulting and group purchasing organization that provides information and materials to other hospices and group purchasing options. Cornerstone leadership has extensive experience in hospice, including development and expansion of new programs in Florida and elsewhere. Cornerstone has achieved significant growth and expansion within its existing service areas in recent years, led largely by the team that would lead Cornerstone’s expansion into Hillsborough. Cornerstone serves all patients in need regardless of race, creed, color, gender, sexual orientation, national origin, age, disability, military status, marital status, pregnancy, or other protected status. Hospice and palliative care are the only healthcare services Cornerstone provides. This focus assures that Cornerstone is committed to providing high quality care to meet the needs of hospice patients and their families. VITAS VITAS Healthcare Corporation (“VITAS Healthcare”), the corporate parent of VITAS, is the largest provider of end-of-life care in the nation. VITAS Healthcare was initially founded in 1978 in South Florida. At that time, its leaders helped organize bipartisan legislative efforts to establish the state and federal regulatory mechanisms that guide the provision of hospice services today. Upon its inception, VITAS programs in Dade and Broward Counties participated in a federal demonstration project that resulted in the development of model clinical protocols and procedures used by hospice programs across the country. In 2018, VITAS Healthcare served 85,095 patients and maintained an average daily census of 17,743 patients among its 47 hospice programs in 14 states and the District of Columbia. As of 2018, VITAS Healthcare employed 12,176 staff members, including over 4,700 nurses nationwide. VITAS currently serves 46 of Florida’s 67 counties, which covers about 72% of Florida’s population. VITAS serves 16 of AHCA’s 27 hospice service areas under three separate licenses. VITAS successfully operates 34 satellite offices in Florida and provides facility-based care through freestanding inpatient units as well as its contracts with hospitals and nursing homes. In Florida in 2018, VITAS served over 36,000 patients, providing 3.3 million days of care with an average daily census of 9,028 patients. This was no aberration—at the time of the filing of its 6A CON application, VITAS had admitted over 35,000 patients in Florida during 2019. In addition to providing the four required levels of hospice care (see ¶ 35), VITAS also provides a full continuum of palliative and supportive care, and additional unreimbursed services that are beneficial to the hospice population it serves. VITAS has over 40 years of experience as a hospice provider, and has developed comprehensive outreach, education, and staff training programs and resources designed specifically to address the unique needs of a wide range of patient types, communities, and clinical settings. Similarly, VITAS recognizes that the needs of Florida patients vary between service areas, and it has endeavored to provide programs and services tailored to meet the needs of each community. In its Florida programs, VITAS provides complete hospice care, including medications, equipment and supplies, expert nursing care, personal care, housekeeping assistance, emotional counseling, spiritual support, caregiver education and support, grief counseling, dietary, physical, occupational and speech therapy, and volunteer support. VITAS has a long history of providing significant levels of care to all patients without regard to the ability to pay, as well as a demonstrated commitment to underserved populations such as the homeless, veterans, AIDS population, and minorities. VITAS provided almost $7 million in charity care in Florida in 2018, and $7.25 million in 2019 at the time it submitted its CON application. VITAS ensures that anyone who is appropriate for hospice services has the right to access them. VITAS is committed to giving back to the communities it serves through meaningful donations. It accomplishes this goal through VITAS Community Connections, a nonprofit organization, which makes donations and grants to local organizations and families. In 2018, VITAS made over $161,000 in charitable contributions to organizations in Florida. In that same year, VITAS contributed over $700,000 to sponsoring Florida community events. At the time of filing its Hillsborough application, VITAS employed nearly 5,500 persons in Florida, 2,235 of which are nurses. VITAS encourages and assists its nurses in obtaining board certification in hospice and palliative care through training, compensation incentives, and support. Due to VITAS Healthcare’s multi-state operations, VITAS can readily recruit staff to Florida from other markets. VITAS also relies on volunteers in a variety of roles to enhance patient care. In 2018, VITAS used 1,165 active volunteers in Florida, who provided over 145,054 volunteer hours. VITAS is led by an extremely experienced and highly qualified leadership team, many of which have long and successful tenures with the company. Hospice Care Generally Hospice refers both to care provided to terminally ill patients and the entities that provide the care. Hospice care is palliative care. Palliative care relieves or eliminates a patient's pain and suffering and helps patients remain at home. It differs from curative care, which seeks to cure a patient's illness or injury. 42 C.F.R. § 418.24(d); §§ 400.6005 and 400.601(6), Fla. Stat. Hospices provide physical, emotional, psychological, and spiritual comfort and support to patients facing death and to their families. The Medicare and Medicaid programs pay for the vast majority of hospice care. The services those programs require hospices to offer and the services the programs will pay for have become, de facto, the default definition of hospice care, the arbiter of hospice services, and the decider of when a patient is terminally ill. Florida requires a CON to establish a hospice program and regulates hospices through licensure. §§ 400.602 and 408.036(1)(d), Fla. Stat. Florida considers a patient with a life expectancy of one year or less to be terminally ill and eligible for Medicaid payment for hospice care. § 400.601(10), Fla. Stat. To be eligible for Medicare payment for hospice services, a patient must have a life expectancy of six months or less. 42 C.F.R. § 418.20; 42 C.F.R. § 418.22(b)(1). A hospice must provide a continuum of services tailored to the needs and preferences of the patient and the patient’s family delivered by an interdisciplinary team of professionals and volunteers. §§ 400.601(4) and 400.609, Fla. Stat. Hospice programs must provide physical, emotional, psychological, and spiritual support to their patients. A hospice must provide physician care, nursing care, social work services, bereavement counseling, dietary counseling, and spiritual counseling. 42 C.F.R. § 418.64; § 400.609(1)(a), Fla. Stat. In Florida, hospices must also provide, or arrange for, additional services including, but not limited to, “physical therapy, occupational therapy, speech therapy, massage therapy, home health aide services, infusion therapy, provision of medical supplies and durable medical equipment [DME], day care, homemaker and chore services, and funeral services.” § 400.609(1)(b), Fla. Stat. Federal requirements are similar. 42 C.F.R. § 418.70. Hospices are required to provide four levels of care. The levels are routine home care, general inpatient care, crisis care (also called continuous care), and respite care. Since hospice’s goal is to support a patient remaining at home, hospices provide the majority of their services in a patient’s home. Routine home care is the predominant form of hospice care. Routine care is for patients who do not need constant bedside support. A hospice may provide routine care wherever the patient lives. The location could be a residence, a skilled nursing facility (SNF), an assisted living facility (ALF), some other residential facility, or a homeless camp. Continuous care, sometimes called crisis care, may also be provided wherever the patient resides. It is more intense services for a short period of time. Continuous care supports a patient whose pain and symptoms are peaking and need quick management. With continuous care, unlike routine care, a nurse may be at a patient’s bedside 24 hours a day, seven days a week. Continuous care is an option allowing a patient to avoid admission to an inpatient facility. Hospices provide general inpatient care in a hospital, a dedicated nursing unit, or a freestanding hospice inpatient facility. To qualify for inpatient care, a patient must be acutely ill and need immediate assistance and daily monitoring to the extent that they cannot be cared for at home. Hospices must offer around-the-clock skilled nursing coverage for patients receiving general inpatient care. Respite care is caregiver relief. It allows patients to stay in an inpatient setting for up to five days in order to provide caregivers respite. Florida law requires hospices to accept all medically eligible patients. Each hospice must make its services available to all terminally ill persons and their families without regard to age, gender, national origin, sexual orientation, disability, diagnosis, cost of therapy, ability to pay, or life circumstances. A hospice may not impose any value or belief system on its patients or their families, and must respect the values and belief systems of its patients and their families. § 400.6095(1), Fla. Stat. Hospices frequently offer additional, uncompensated services that are not required by Florida licensure laws or federal Medicare requirements. Pre- hospice care and community counseling are two examples. Hospices often establish programs to meet the needs of particular populations, such as the Hispanic, African American, Jewish, veteran, and HIV/AIDS communities. Cornerstone, Suncoast Pinellas, and VITAS provide the hospice services required by state laws and funded by the Medicare benefit. All three providers also offer services beyond those required by, or paid for by, government programs. The Fixed Need Pool and Preliminary Agency Decision Pursuant to its rule-based numeric need methodology, AHCA determined and published a fixed need for one new hospice program in SA 6A, Hillsborough, in the second batching cycle of 2019. Under the Agency's need methodology, numeric need for an additional hospice program exists when the difference between projected hospice admissions and the current admissions in a service area is equal to or greater than 350. In this instance, the difference between projected hospice admissions and current admissions in SA 6A was 863, and therefore a numeric need for an additional hospice program exists in Hillsborough.3 In addition to the three litigant applicants, three other entities filed applications seeking approval for the new program. Those three applications have been deemed abandoned and are not at issue herein. On February 21, 2020, the Agency published its preliminary decision to award the hospice CON to Suncoast, and to deny the remaining applications. Thereafter, Cornerstone and VITAS both filed timely petitions for formal administrative hearing contesting the Agency’s preliminary decision. On April 1, 2020, Suncoast filed a “Cross Petition, Notice of Related Cases and Notice of Appearance” in support of the Agency decision on the competitively reviewed applications. None of the applicants petitioning for 3 According to AHCA’s need methodology, absent a showing of “not normal” circumstances, only one new hospice program may be approved for a SA at a time, regardless of the multiples of 350 “need” that may be shown. Fla. Admin. Code R. 59C-1.0355(4)(c). hearing alleged “special circumstances” or “not normal” circumstances in their application. Service Area 6A: Hillsborough County As can be seen by the map below, Hillsborough is located on the west coast of Florida along Tampa Bay. It includes 1,048 square miles of land area and 24 square miles of inland water area. Hillsborough is home to three incorporated cities: Tampa, Temple Terrace, and Plant City, with Tampa being the largest and serving as the county seat. The county is bordered by Pasco County to the north, Polk County to the east, Manatee County to the south, and Pinellas County to the west. (Source: Google Maps) According to AHCA’s Florida Population Estimates 2010-2030, published February 2015, Hillsborough’s total population as of January 2020 was estimated to be 1,439,041. Hillsborough’s total population is expected to grow to 1,557,830 by January 2025, or 8.25% over that five-year period. In 2020, 14% of Hillsborough’s population was aged 65 and older. According to the 2010 U.S. Census, 35.4% of the county population age 65 and older has a disability, and 17.2% of the county population is below the poverty level, compared to 12.2% statewide. The Hillsborough County Department of Health (“HCDOH”) reports that the county has a diverse mix of residents, with 52% White, 16% African American, 26% Hispanic, and 5% other races. Of the Hillsborough households living below the poverty level, 23.73% are Hispanic/Latino and 31.07% are African American. Nearly 10% of Hillsborough residents report not speaking English “very well.” The most recent U.S. Census indicates that the median income for households in Hillsborough is $54,742, considerably below the national average, with 17.2% reported below poverty level. A larger percentage of the county’s residents (3.3%) received cash assistance than did the state’s residents (2.2%), and a larger percentage (15.7%) received food stamp benefits than is the case for the state overall (14.3%), as reported by HCDOH. Hillsborough is currently served by two hospice providers: Lifepath Hospice (“Lifepath”); and Seasons Hospice and Palliative Care of Tampa, LLC (“Seasons”), a for-profit company. Following approval after an administrative hearing, Seasons was newly licensed to begin operations in Hillsborough in December 2016. Florida’s hospice CON rule prevents need for a new program from being shown for a period of two years following the addition of a new program to a service area. The purpose of the two-year forbearance is to allow new programs to gain a foothold in the market, and to potentially avoid a repeated need determination in future batching cycles. Hospice admissions at Lifepath for the period of July 1, 2018, through June 30, 2019, were 6,195, and for Seasons were 601. The addition of Seasons to the service area was not successful in deterring the need for yet another new program in Hillsborough. The Application Proposals and CON Conditions Suncoast Suncoast recently applied for approval for a hospice program in neighboring Pasco County, but, after a DOAH hearing, that application was denied in favor of another applicant. From that experience, Suncoast determined to better identify local needs before applying for approval in Hillsborough. Upon learning that a fixed need pool would be announced for Hillsborough, Mr. Sciullo directed his team of executives and staff over a series of strategy meetings to conduct an independent community needs assessment of Hillsborough. Mr. Sciullo tasked Kathy Rabon to oversee the development of a community needs assessment of Hillsborough to identify potential needs of Hillsborough residents, based on key informant surveys and other assessment tools. Ms. Rabon has significant experience in conducting feasibility studies for capital projects funded by the Suncoast Hospice Foundation, which she leads. Ms. Rabon began by reviewing existing community needs assessments of the county. Those assessments identified the health needs of Hillsborough’s underserved patients, and identified community leaders that informed the assessments. Ms. Rabon then contacted many of those key informants. At hearing, Ms. Rabon described the process she used to develop a community needs assessment for Hillsborough as follows: Q. When tasked with doing an assessment for Hillsborough's hospice, where did you start? What documents did you first review? A. A community needs assessment can take quite a while when you engage focus groups and need to meet with stakeholders. We didn't have the luxury of a lot of time. We also had the luxury of knowledge that other hospitals in Hillsborough County that are not-for-profit have to periodically do a community needs assessment. So rather than start from a blank piece of paper, I turned to those community needs assessments and I began compiling and gathering as many as I could that I felt were relevant to, A, the geographic boundaries of the entire county, which some did not, but B, also were timely. And I found that the Department of Health had done a very comprehensive community needs assessment in 2015-16 that had been updated in March of 2019 that I felt would provide a lot of good information. * * * I was responsible for identifying need and, if possible, identifying perhaps solutions that could be developed as a result of a partnership or a relationship or an engagement or a future plan that we could put together that would help solve a need in Hillsborough County relative to chronic and advanced illness. In addition to the HCDOH needs assessment and update, Ms. Rabon also obtained quantitative information for her assessment from the following sources: Community Health Improvement Plan 2016- 2020, Florida Department of Health in Hillsborough County, Revised January, 2018; Moffitt Cancer Center Community Health Needs Assessment Report 2016; Florida Hospital Tampa Community Needs Assessment Report 2016; Florida Hospital Carrollwood Community Needs Assessment Report 2016; South Florida Baptist Hospital 2016 Community Needs Assessment Report; Tampa General Hospital; Community Health Needs Assessment 2016; and Community Needs Assessment St. Joseph’s Hospitals Service Area 2016. Ms. Rabon also developed a key informant survey tool to elicit qualitative information regarding the healthcare needs of Hillsborough residents. The survey specifically asked about the strengths and weaknesses of the community for treatment of persons with chronic or advanced illness, and other pressing issues relating to end of life care. Those survey questions included, among others: What is your role, and responsibilities within your organization? What do you consider to be the strengths and assets of the Hillsborough community that can help improve chronic and advanced illness? What do you believe are the three most pressing issues facing those with chronic or advanced illness in Hillsborough County? From your experience, what are the greatest barriers to care for those with chronic or advanced illness? What are the strategies that could be implemented to address these barriers? Once meetings with key informants were complete, and 25 key informant surveys were returned, Ms. Rabon summarized her findings in a final Community Needs Assessment Summary. Ms. Rabon’s findings were consistent with assessments conducted by other organizations, including HCDOH, and local hospitals. The results of the Community Health Needs Assessments, Suncoast Key Informant Surveys, and detailed letters of support, identified the following gaps in end-of-life care for residents of Hillsborough: Need for Disease-Specific Programming: High cardiovascular disease mortality rates (higher than the state average and the highest of the six most populous counties in Florida) and low percentage of patients served by existing hospice providers. Other areas where there appears to be a gap in specific end-of-life programming and a large need in terms of Hillsborough resident deaths include: Alzheimer's Disease and Chronic Lower Respiratory Disease, both of which are in the top 5 leading causes of death in the county. Need for Ethnic Community-Specific Programming Nearly 30 percent of the Hillsborough population is Hispanic, with 19 percent of the county's 65+ population falling into the Hispanic ethnic category. The concentration of 65+ Hispanic residents in Hillsborough is higher than the state average. Surveys and assessments indicate a lack of knowledge in the Hispanic/Latinx[4] community in Hillsborough regarding end-of-life care. Many of these residents speak Spanish at home and/or have limited English proficiency. Hillsborough Hispanic population has low utilization of hospice due to factors including lack of regular physician and medical care, lack of information and cultural barriers. Lack of Available Resources for Homeless and Low-lncome Populations With the 5th largest homeless population in the state, Hillsborough has 1,650 homeless residents as of a Point in Time Count conducted in February 2019. Nearly 60 percent of the area’s homeless population is considered ‘sheltered’, yet there are no resources for end-of-life care for these patients where they live, whether it be an emergency shelter, safe haven or transitional housing. Additionally, 17.2 percent of the Hillsborough population lives below the poverty level and has limited access to coordinated care, including end-of- life services. Largest Veteran Population in Florida Requires Special Programming and Large Number of Resources More than 93,000 veterans currently reside in Hillsborough, with more than one-third over the age of 65. 4 Latinx is a gender-neutral neologism, sometimes used to refer to people of Latin American cultural or ethnic identity in the United States. The ?-x? suffix replaces the ?-o/-a? ending of Latino and Latina that are typical of grammatical gender in Spanish. See “Latinx,” Wikipedia (last visited March 19, 2021). While most hospice programs provide special services for veterans, Suncoast Pinellas has obtained Partner Level 4 certification by We Honor Veterans, a program of the National Hospice and Palliative Care Organization (“NHPCO”) in collaboration with the Department of Veterans Affairs (“VA”). Lack of Specialized Pediatric Hospice Program in the Area Pediatric hospice programming in Hillsborough is limited, as there are no specialized pediatric hospice providers in the county. Hillsborough is home to approximately 338,000 residents ages 0-17 in 2020, and is projected to increase to more than 368,000 by 2025. The pediatric utilization rate of hospice services in Hillsborough is low compared to the general population. For the year ended March 31, 2019, there were only five pediatric patients discharged from the hospital setting to home hospice or an inpatient hospice facility, while 106 pediatric patients died in the hospital. Absence of Continuum of Care Navigation Navigation of the healthcare system was highlighted as a key driver that will bring positive improvements to overall continuum of care in Hillsborough. Hillsborough residents are not accessing hospice services at a rate consistent with the rest of the state, and either access hospice programs very late in the disease process, or not at all. Transportation Challenges for Rural Areas of the County Transportation challenges as a deterrent to seeking medical care, particularly in rural areas of Hillsborough. Approximately one-third of the Hillsborough population is considered “transportation disadvantaged” meaning they are unable to transport themselves due to disability, older age, low income or being a high-risk minor/child. Suncoast retained David Levitt and his firm as its healthcare consultant and primary drafter of its CON application. To develop Suncoast’s application, Mr. Levitt utilized numerous reliable data sources and worked with Suncoast Pinellas’s staff. Mr. Levitt credibly confirmed the need for an additional hospice program in Hillsborough based on reliable healthcare planning data. AHCA’s CON application form, adopted by rule, requires applicants to submit letters of support with their CON applications. Suncoast complied with this requirement and included numerous letters of support from the Hillsborough community. One of the key informants identified by Ms. Rabon was Dr. Douglas Holt of the HCDOH. Dr. Holt agreed to meet with Mr. Sciullo and ultimately agreed to provide a letter of support, which was included with the Suncoast application. Mr. Sciullo also personally met with Dr. Larry Fineman, the regional medical director of HCA West Florida, who provided a letter of support. HCA West Florida hospitals are key referral sources of Suncoast Pinellas’s current hospice admissions. In addition to HCA West Florida, Suncoast Pinellas has an existing relationship with other Hillsborough hospitals: St. Joseph’s, Moffitt Cancer Center and Tampa General Hospital. Suncoast received letters of support from St. Joseph’s and Tampa General. The Agency’s witness, James McLemore, testified that letters from such referral sources were highly persuasive to the Agency, as they indicate the likelihood of successful operations. Suncoast’s witness, Dr. Larry Kay, credibly testified that he obtained letters of support from Dr. Howard Tuch, Director of Palliative Medicine at Tampa General Hospital; Dr. Larry Feinman, Chief Medical Officer at HCA West Florida; and Dr. Harmatz, the Chief Medical Officer at Brandon Regional Hospital, an HCA hospital within HCA West Florida. Those letters were included with the Suncoast application. Suncoast Pinellas currently has working relationships with BayCare, HCA, AdventHealth West Florida, Tampa General, and Moffitt hospital systems. Suncoast submitted letters from BayCare and HCA, which were included with its application. Suncoast received letters specifically related to partnering with Suncoast for inpatient services from St. Joseph’s (BayCare) and Brandon Regional (HCA). Suncoast also received a letter of support related to partnering with Suncoast for inpatient services from the Inn at University Village, a long- term care facility in Hillsborough; and support from a pediatric hospitalist who provides care to terminally ill and medically fragile children at St. Joseph’s Children’s Hospital and Johns Hopkins All Children’s Hospital. Suncoast also received letters of support from numerous community organizations, including Balance Tampa Bay and The AIDS Institute. Also included with the Suncoast application were several letters of support from [Remainder of page intentionally blank] the veterans’ community, including one from the Military Order of the World Wars.5 After considering Ms. Rabon’s Community Needs Assessment, and input from key informants, Suncoast developed programs and plans to meet each of the needs identified above. Suncoast conditioned the approval of its CON on the provision of those services. In all, Suncoast offered 19 conditions in its CON application intended to meet the unique needs of Hillsborough. Condition 1: Development of Disease Specific Programing: Suncoast is committed to providing disease-specific programming in Hillsborough: Empath Cardiac CareConnections, Empath Alzheimer’s CareConnections, and Empath Pulmonary CareConnections. Dr. Larry Kay and Dr. Janet Roman credibly testified that Suncoast will fulfill Condition 1 for disease specific programming. To fulfill Condition 1, Suncoast will provide Empath Cardiac CareConnections in Hillsborough. Dr. Roman designed and currently runs the CardiacCare Connections program in Pinellas County. Dr. Roman is a national expert in developing programs across the continuum of care to assist heart failure patients. Although Suncoast Pinellas has always treated patients with heart failure, since Dr. Roman’s arrival, cardiologists have been referring patients to Suncoast Pinellas earlier than before. Dr. Roman has trained Suncoast Pinellas’s nurses in all advanced heart failure therapies, including IV inotropes, and mechanical circulatory 5 As correctly noted by Cornerstone in its Proposed Recommended Order, letters of support included in the three applications, unless adopted by the sponsoring author at hearing or in sworn deposition received in evidence, are uncorroborated hearsay, and the contents therein may not form the basis of a finding of fact. However, the letters are not being received for the truth of the matters set forth therein, but rather the number and types of support letters included in the applications are relevant generally as a gauge of the level of community support for the proposals. The Hospice of the Fla. Suncoast, Inc. v. AHCA and Seasons Hospice and Palliative Care of Pasco Cty., DOAH Case No. 18-4986 (Fla. DOAH Sept. 5, 2019; Fla. AHCA Oct. 15, 2019) (“In a broad sense, comparison of each applicant's letters of support illuminates the differences between each applicant's engagement with the community.” FOF No. 127.). supports such as left ventricular assist devices (“LVAD”) and artificial hearts. Dr. Roman’s program has been successful at reducing hospital readmissions. Suncoast’s application provided significantly more detail about the operations of its heart program than either Cornerstone or VITAS. Cornerstone and VITAS’s descriptions of their heart programs do not reach the level of specificity of operation as Suncoast’s and are not backed up with a measure of success such as a reduction in readmissions. In furtherance of Condition 1, Suncoast will also offer Empath Alzheimer’s CareConnections. Suncoast Pinellas has already created the foundation for Empath Alzheimer’s CareConnections in Pinellas County, but has not yet been marketing the program under the brand of CareConnections. As part of Empath Alzheimer’s CareConnections, Suncoast will deploy a Music in Caregiving program for Hillsborough hospice patients, including those suffering from Alzheimer’s Disease. Suncoast will also offer Empath Pulmonary CareConnections in Hillsborough. Suncoast Pinellas has already created the foundation for Empath Pulmonary CareConnections in Pinellas County, but has not yet been marketing the program under the brand of CareConnections. Suncoast Pinellas already has several respiratory therapists full time caring for COPD and asthma patients. In Hillsborough, Suncoast plans to engage a pulmonologist as a consultant and to hire dedicated respiratory therapists as volume increases in Hillsborough. Condition 2: Development of Ethnic Community-Specific Programming Suncoast conditioned its CON application on the purchase of a mobile van staffed by a full-time bilingual LPN and a full-time bilingual social worker to discuss advanced care planning and education, and increase access to care to diverse populations. The van will operate eight hours a day, five days a week, and drive to areas in Hillsborough that have a need for the services offered by Suncoast and Empath. This outreach is intended to enhance access to care to diverse communities. The van will spend time at the HCDOH and its satellite clinics, and use Metropolitan Ministries as a resource for identifying additional locations that could benefit. The van will also visit key Latinx community locations within Hillsborough and offer Spanish language assistance. The van will be equipped with telehealth technology capabilities to link the LPN and social worker to the care navigation office to further enhance the care navigation function of the mobile van. The purpose of the mobile outreach van is to build relationships with, and trust in, the community, enhance visibility, and bring care navigation to areas of Hillsborough that may not typically access it. Suncoast Pinellas’s EPIC program has significant experience operating a mobile outreach unit. EPIC currently operates a mobile outreach and testing unit that provides HIV testing and sexually transmitted infection testing in the community. Condition 3: Development of Resources for Homeless and Low-Income Populations Suncoast conditioned its application on the development of resources for homeless and low-income populations. Under this condition, Suncoast will provide up to $25,000 annually for five years to Metropolitan Ministries. Metropolitan Ministries is a leading community-based organization in Hillsborough that serves homeless and low-income individuals. Christine Long, Chief Programs Officer for Metropolitan Ministries, provided a letter of support which was included in Suncoast’s CON application. Condition 4: Development of Specialized Veterans Program Suncoast conditioned its CON application on the development of a specialized veterans program, which includes a dedicated Veterans Professional Relations Liaison to collaborate with the local VA hospital, outpatient clinics, and veterans organizations. Suncoast Pinellas provides a wide range of specialized care for veterans, through its Empath Honors program, including Honor Flight and pinning ceremonies. Additionally, Suncoast Pinellas holds a Level 4 Certification from We Honor Veterans, a national program through the National Hospice and Palliative Care Organization (“NHPCO”) whose mission is to honor military veterans in hospice care. The NHPCO recently added a new Level 5 Partnership, for which Suncoast Pinellas has already applied for its Pinellas hospice program. Suncoast will also pursue a Level 5 Certification in Hillsborough, if awarded the CON. Condition 5: Development of Specialized Pediatric Hospice Program in Hillsborough County Suncoast will also develop a specialized pediatric hospice program in Hillsborough. Dr. Stacy Orloff started the Children’s Hospice Program at Suncoast Pinellas in 1990 and has been with Suncoast Pinellas for 30 years. Dr. Orloff helped draft the first waiver that the State of Florida submitted to CMS for approval to operate a PIC/TFK program. Once the PIC/TFK waiver was approved, Ms. Orloff led Florida’s PIC/TFK steering committee for 12 years. PIC/TFK is a Medicaid waiver program that provides palliative care services for children with a risk of a death event by age 21, and also provides counseling support for family members who lived at the child’s home, such as parents, siblings, and grandparents. A PIC/TFK provider must be a licensed hospice provider in the service area. Suncoast Pinellas has operated a PIC/TFK program in Pinellas since 2004, utilizing a pediatric interdisciplinary team to provide its PIC/TFK services. Suncoast Pinellas’s PIC/TFK program averages a census of approximately 40 children. Combining the PIC/TFK patients with pediatric patients, Suncoast Pinellas’s census averages approximately 50 children. Suncoast Pinellas has already received acknowledgment from Children’s Medical Services to permit it to operate a PIC/TFK program in Hillsborough if awarded the hospice CON. Initially, pediatric patients will be serviced by the Suncoast Pinellas pediatric staff. Suncoast Pinellas currently has sufficient staff availability to service Hillsborough at the commencement of the program. Suncoast anticipates that by the second year, the Hillsborough pediatric program will have a sufficient census to have a staff that serves only Hillsborough. VITAS’s regional Medical Director, Dr. Leyva, acknowledged that a pediatric patient will receive better care from a care team with pediatric expertise than with an adults-only team. Of the three applicants, Suncoast has demonstrated the most experience providing care to pediatric patients.6 In addition, Suncoast Pinellas has longstanding relationships with the local children’s hospitals, St. Joseph’s Children’s Hospital, and Johns Hopkins All Children’s Hospital. Concurrent care is a benefit created as part of the Affordable Care Act that allows children admitted to hospice care to continue to receive their curative care. Although all applicants have proposed providing concurrent care, only Suncoast has proposed a PIC/TFK program. Suncoast is the only applicant currently operating a perinatal loss program and miscarriage at home program. Dr. Orloff credibly confirmed that Suncoast will implement the perinatal loss program if approved in Hillsborough. Condition 6: Development of Continuum of Care Navigation Program Suncoast’s Community Needs Assessment identified that Hillsborough lacks effective access to the full continuum of healthcare services. Suncoast 6 AHCA’s witness, James McLemore, credibly testified that this is an area where Suncoast enjoys an advantage over the other applicants because “Suncoast went with an entire pediatric program.” Pinellas operates an entire care navigation department that can address any inquiry or referral regarding hospice and Empath’s other services, in order to direct that patient to the right care at the right time. All services offered by Empath, including hospice, palliative care, home health, EPIC, and PACE are available to individuals who call the Care Navigation Center. Care Navigation staff can also assist existing patients with questions involving, for example, DME. Suncoast Pinellas’s care navigation center is available 24 hours a day, 7 days a week, 365 days a year. If its application is approved, Suncoast will also offer its Care Navigation Department in Hillsborough. Condition 7: Development of a Program to Address Transportation Challenges for Rural Areas Suncoast has conditioned its application on developing a program to address transportation challenges for rural areas in Hillsborough. As part of this condition, Suncoast will provide up to $25,000 annually in bus vouchers for the first five years to current hospice patients and their families, as well as non-hospice patients. Critics of Suncoast’s plans to offer bus vouchers claimed that Hillsborough’s bus system does not reach all areas within the county. However, Suncoast has also conditioned its application on the provision of funds that may be used to purchase transportation, including ridesharing providers such as Uber. Condition 8: Interdisciplinary Palliative Care Consult Partnerships Suncoast will implement interdisciplinary palliative care partnerships with hospitals, ALFs, and nursing homes located in Hillsborough. Suncoast has already identified potential partnerships, including with Dr. Harmatz at Brandon Regional Medical Center, to launch the program. Condition 9: Dedicated Quality-of-Life Funds for Patients and Families Suncoast is committed to providing quality of life funds as described in Condition 9 in Suncoast’s CON application. Suncoast Pinellas has extensive experience with providing each interdisciplinary team with $1,200 of quality of life funds to be used to facilitate a safe environment for its patients, such as paying rent, getting rid of bedbugs, paying utilities such as electricity for air conditioning, and to power specialized medical equipment. On occasion these funds are also used to provide meaningful patient experiences, similar to the Make-a-Wish programs. Conditions 10 – 13: Development of Advisory Committees and Councils Suncoast has committed to establishing care councils and advisory committees to learn firsthand the needs and concerns of the community. A care council is made up of members from a particular community who provide input regarding the needs of the community. Suncoast Pinellas offers similar councils and committees in Pinellas County. These groups are critical to the success of Suncoast Pinellas’s mission. Condition 14: Development of Open Access Model of Care Suncoast has committed to implementing an open access model of care in Hillsborough. This condition recognizes that while some patients may be receiving complex medical treatments that may lead some to question whether the patient is terminal, those treatments are actually required for palliation and the patient’s comfort. Under this condition, Suncoast promises to admit these patients and provide coverage for their treatments. Condition 15: SAGECare Platinum Level Certification Joy Winheim testified at the final hearing regarding the HIV positive community and the LGBTQ community. Over her many years working with the HIV/AIDS community, Ms. Winheim has built lasting relationships with community partners in the Tampa Bay area, including HCDOH and the Pinellas County Health Department. Empath’s EPIC program has a permanent staff member housed within the HCDOH, and the HCDOH has physicians housed in EPIC’s Tampa office to provide medical care to EPIC’s clients. Ms. Winheim has built lasting relationships with community partners in the Tampa Bay LGBTQ community, including Metropolitan Community Church, an LGBTQ friendly church; the Tampa Bay Gay and Lesbian Chamber of Commerce; and Balance Tampa Bay. SAGE is a national organization dedicated to improving the rights of LGBTQ seniors by providing education and training to businesses and non- profits. The platinum level of SAGECare certification is the highest level and indicates that 80% of an organization’s employees and 100% of its leadership have been trained by SAGE. Leadership training is in the form of a four-hour in-person training. Employee training is in the form of a one-hour training conducted either in person or web-based. All of Empath’s entities are SAGECare certified at the platinum level. Although the platinum level certification requires only 80% of its employees to receive training, Empath Health required that 100% of its employees attend the training. SAGECare certification makes a difference to members of the LGBTQ community choosing a healthcare provider. Suncoast is committed to fulfilling this condition. Condition 16: Jewish Hospice Certification Suncoast Pinellas has a specialized Jewish Hospice Program and holds a Jewish Hospice Certification from the National Institute of Jewish Hospices. Suncoast has conditioned its CON application on achieving this same certification in Hillsborough by the end of year one. Condition 17: Joint Commission Accreditation The Joint Commission on Accreditation of Healthcare Organizations (“Joint Commission”) accreditation is the “gold standard” for hospitals, nursing homes, hospices, and other healthcare providers. Suncoast is currently accredited by the Joint Commission, and if approved, is committed to achieving Joint Commission accreditation for its Hillsborough program. Condition 18: Provision of Value-Added Services Beyond Medicare Hospice Benefit Suncoast has committed to provide its integrative medicine program in Hillsborough. Suncoast Pinellas’s existing integrative medicine program is staffed by an APRN who is also certified in acupuncture. Suncoast Pinellas’s integrative medicine program is a holistic approach for helping patients manage their symptoms with such therapies as acupuncture, Reiki,7 and aromatherapy. Suncoast Pinellas recently established a Wound, Ostomy, and Continence Nurse Program in Pinellas County to provide expertise in end-of- life wounds and incontinence issues in long-term care settings, particularly smaller ALFs that may not have the necessary staffing. Suncoast will also offer this program in Hillsborough. [Remainder of page intentionally blank] 7 Reiki (??, /'re?ki/) is a Japanese form of alternative medicine called energy healing. Reiki practitioners use a technique called palm healing or hands-on healing through which a “universal energy” is said to be transferred through the palms of the practitioner to the patient in order to encourage emotional or physical healing. Condition 19 – Limited Fundraising in Hillsborough County Suncoast has committed to limiting fundraising activities in Hillsborough. Ms. Rabon credibly testified that Suncoast can, and will, fulfill this condition.8 Suncoast’s PACE Program In addition to its conditions, Suncoast’s proposal also includes several other non-hospice services that will be made available in Hillsborough. For example, Suncoast Pinellas operates a PACE program. The PACE program provides everything from medical care to transportation for medical needs and adult daycare services, as well as respite services for caregivers. The overall goal of the PACE program is to reduce unnecessary hospital visits and nursing home placement and keep elderly participants at home. Suncoast Pinellas’s PACE program currently operates at capacity, with 325 participants enrolled. Over the last four years, Suncoast Pinellas PACE has referred 175 people to Suncoast Pinellas. And although there are approximately 14,000 eligible PACE participants in Hillsborough, there is not a PACE provider in the county. In recognition of this unmet need, Suncoast Pinellas is currently in the process of expanding PACE services to residents of Hillsborough. Suncoast’s PACE program distinguishes Suncoast from Cornerstone and VITAS, neither of which currently operates a PACE program in any of their service areas. Suncoast’s Volunteer Program Under the Medicare Conditions of Participation, hospice programs must use volunteers “in an amount that, at a minimum, equals 5 percent of 8 Both Suncoast and Vitas condition their applications on eschewing fundraising activities in SA 6A, apparently in an effort to minimize adverse impact on the two existing providers in the service area. However, neither Lifepath nor Seasons participated as a party to this litigation, or presented evidence at hearing as to revenues received through their fundraising activities. Thus, it is impossible to determine whether the conditions proposed by Suncoast and VITAS would have a material impact on either of the existing providers. the total patient care hours of all paid hospice employees and contract staff.” 42 C.F.R. § 418.78(e). Suncoast Pinellas regularly exceeds that 5% requirement and, in fact, reached 12% in the last fiscal year. Suncoast Pinellas currently has over 1,000 volunteers who support the hospice program by assisting with palliative arts, including Reiki and aromatherapy, Lifetime Legacies, pediatric patients, and transportation. Suncoast Pinellas’s volunteers also assist with Suncoast’s Pet Peace of Mind Program, for which Suncoast Pinellas won the inaugural award for program of the year in 2019. Suncoast is the only applicant that operates a teen volunteer program. Suncoast Pinellas’s teen volunteer program was established in 1994 and was the first of its kind in the entire country. In 1998, it was awarded the Presidential Point of Light award. Suncoast Pinellas’s Volunteer Services Director, Melissa More, regularly consults with hospices across the country on the development of teen volunteer programs. Ninety of Suncoast Pinellas’s 1,000 volunteers currently live in Hillsborough, but travel to Pinellas to volunteer at Suncoast Pinellas. Nine of those volunteers submitted letters of support for Suncoast’s CON application to serve Hillsborough. Doctor Direct Program Suncoast Pinellas’s existing Doctor Direct Program enables physicians in the community and their ancillary referral partners to contact a Suncoast Pinellas physician 24/7, who can answer any questions about a patient they think might be eligible for hospice, and questions related to other Suncoast Pinellas programs. Suncoast will provide its Doctor Direct Program in Hillsborough. Plan for Inpatient Services Suncoast received letters of support from hospitals and a nursing home indicating a willingness to enter into a contract for inpatient services with Suncoast. Suncoast intends to offer both inpatient units and “scatter- bed” arrangements with these providers. Suncoast received letters specifically related to potential partnerships with St. Joseph’s (BayCare) and Brandon Regional (HCA) for the provision of inpatient hospice services. Suncoast also received a letter related to a potential partnership with the Inn at University Village, a long-term care facility in Hillsborough, for the provision of inpatient services. Telehealth Suncoast Pinellas offers telehealth services using CMS and HIPAA- approved software so that patients can keep meaningful connections with their family and friends, regardless of ability to travel. In Hillsborough, Suncoast will provide nurses, social workers, and chaplains with traveling technology for use in the patient’s home to connect with family and friends. Utilizing telehealth in this way will help to minimize emergency room visits and hospitalizations. Suncoast will be prepared to implement its telehealth program in Hillsborough on day one of operation if awarded the CON. Outreach Efforts to Diverse Communities Suncoast is committed to, and has a proven track record of, community outreach efforts to diverse communities. As part of its outreach efforts in Hillsborough, Empath’s Vice President of Access and Inclusion, Karen Davis-Pritchett, met with the Executive Director of the Hispanic Service Council, Maria Pinzon, to discuss the organization’s outreach efforts and gain insight into the Hispanic community in Hillsborough. Ms. Davis- Pritchett learned that the Hispanic community in Hillsborough differs from the Hispanic community in Pinellas, in that Hillsborough has a large and spread out migrant population. Ms. Davis-Pritchett and Ms. Pinzon also discussed the transportation issues facing residents of Hillsborough. To address these transportation issues, Suncoast conditioned its CON application on the purchase and use of a mobile outreach van with bilingual staff to conduct outreach to the Hispanic and other diverse communities. Suncoast also conditioned its application on the provision of vouchers that may be used for buses or ride-sharing services. Ultimately, Suncoast obtained a letter of support from Ms. Pinzon, which was submitted with its CON application. Additionally, Suncoast conditioned its application on recruiting four community partnership specialists, who will conduct outreach to the African American community, the Hispanic community, the Veterans community, and the Jewish community, and six professional liaisons who will conduct outreach to clinical partners in Hillsborough. All of these positions will be dedicated to Hillsborough and be filled by individuals who are connected to these communities, and understand the importance of access to hospice care. Suncoast’s proposal includes a bilingual medical director, Dr. Jerez- Marte, for its Hillsborough program. Dr. Jerez-Marte regularly speaks Spanish with patients and staff, which would be a benefit to Hispanic patients in Hillsborough. Mr. Sciullo credibly testified that Suncoast will offer high quality hospice services in SA 6A, and will fulfill the 19 conditions proposed in its application. Cornerstone Based on its review of data and analytics that Cornerstone relies upon and conducts as part of its ongoing operations in Florida, Cornerstone recognized in the second quarter of 2019, long before AHCA published its need projections, that there was need for an additional hospice program to enhance access to hospice services in Hillsborough. Regardless of the service area, Cornerstone offers quality hospice care through consistent policies, protocols, and programs to ensure that patients are getting the highest quality care possible. Cornerstone will bring all aspects of its existing hospice programs and services to Hillsborough, including all of the programs and services described throughout its application. However, Cornerstone recognizes each service area is different in terms of the needs and access issues patients face, whether based on demographics, geography, infrastructure, a lack of information about hospice, or other factors. When looking to enter a market, Cornerstone conducts a detailed community-oriented needs assessment to determine the specific needs of the community with regard to hospice to best understand how to enhance access to quality hospice services. Cornerstone explores each potential new area to identify the cultural, ethnic, and religious makeup of the community, the current providers of end- of-life care in the community, and the unmet needs and gaps in care, which is critical to understanding where issues may lie. This allows Cornerstone to build and develop an appropriate operational plan to meet the needs identified in a particular market. Cornerstone conducted this type of analysis for its recent successful expansion in Marietta, Georgia, and has had success expanding access to hospice in its existing markets through ongoing similar analyses. Cornerstone conducted an analysis of Hillsborough similar to those it conducts in its existing markets and in expansion efforts outside its existing markets. In its assessment of Hillsborough, Cornerstone relied, in part, on the extensive knowledge of its senior leaders and outreach personnel, many of whom live and previously worked in Hillsborough, with regard to the population characteristics and needs of the Hillsborough area. This experience in the target service area affords Cornerstone’s team a detailed knowledge of the hospice-related needs of the county. Mr. D’Auria, who conducted much of the analytics internally for Cornerstone, also oversaw a team of Cornerstone staff who spent several weeks canvassing Hillsborough at a grassroots level. The Cornerstone team spoke to residents, medical professionals, community leaders, SNFs, ALFs, and hospitals, among others, on the local experience of hospice care, to identify any areas of concern regarding unmet needs or perceived improvements necessary relative to the provision of hospice care by the current providers. Cornerstone’s retained health planning experts, Mr. Roy Brady and Mr. Gene Nelson, further undertook an extensive data-driven analysis of Hillsborough’s health-related needs to explore the access issues and service gaps identified in Cornerstone’s analytics, knowledge of and discussions in the local community, as well as the issues raised in community health needs assessments,9 letters of support, and other resources. Together, the team concluded that quality hospice services are available in Hillsborough County through existing providers LifePath and Seasons Hospice. That care is available to patients of all ages and demographic groups with virtually any end-stage disease process. Yet some patients simply are not accessing hospice services at the expected rate in Hillsborough. For example, Cornerstone’s analyses identified specific unmet community need among particular geographic areas, as well as among persons with a diagnosis other than cancer, particularly those under age 65, persons with end-stage respiratory disease, the Hispanic and African American communities, migrant communities, residents of smaller ALFs, and veterans. Based upon its analysis of the healthcare needs of Hillsborough, Cornerstone included multiple conditions intended to address those needs. In 9 Cornerstone considered the health needs assessments released by Tampa General Hospital and the Moffitt Cancer Center, both published in 2019. Cornerstone also considered the health needs assessment prepared by HCDOH issued on April 1, 2016, as updated, including the March 2019 update. all, Cornerstone proposed 10 conditions in its CON application targeted to meet the hospice needs of Hillsborough: Licensure of the Hospice Program: Cornerstone commits to apply for licensure within 5 days of receipt of the CON to ensure that its service delivery begins as soon as practicable to enhance and expand hospice and community education and bereavement services in SA 6A; Hispanic Outreach: Cornerstone commits to provide two full-time salaried positions for bilingual staff as part of its Community Education Team. These Community Education Team members will be responsible for the development, implementation, coordination and evaluation of programs to increase community knowledge and access to hospice services, particularly designed to reach the Hispanic community in Spanish. Bilingual Volunteers: Cornerstone commits to recruit bilingual volunteers. Patients’ demographic information, including other languages spoken, is already routinely collected so that the most compatible volunteer can be assigned to fill each patient’s visiting request. Offices: Cornerstone commits to establish its first program office in the Brandon area (zip code 33511 or 33584) during the first year of operation. Cornerstone commits to establish a satellite office in the Town & Country area (zip code 33615 or 33634) during the second year of operations. Complimentary Therapies: Cornerstone conditions its application on offering alternative therapies to patients that may include massage therapy, music therapy, play therapy, and holistic (non-drug) pain therapy. These complimentary therapies are not generally considered to be part of the hospice's core services, but are enhancements to the patient’s care which often have a marked impact on the quality of life during their last days. Veterans: Cornerstone commits to providing services tailored to the military veterans in the community. Cornerstone will immediately upon licensure expand its existing We Honor Veterans Level 4 program to serve Hillsborough and will provide the same broad range of programs and services to veterans in Hillsborough as it currently provides in its existing service areas. Bereavement Counseling for Parents: Cornerstone will implement a program in its second year of operation which will provide outreach for bereavement and anticipatory grief counseling for parents of infants who have died. The Tampa area has several hospitals which provide high-level newborn and infant services such as Level III NICU and other programs, consequently there is a higher than average infant mortality rate due to this concentration of high-level services. Cornerstone will work with the local hospitals which provide high-level neonatal intensive care to develop and carry out this program. Cooperation with Local Community Organizations: Cornerstone commits to donate at least $25,000.00 for four years to non-profit community organizations focused upon providing greater healthcare access, disease advocacy groups and professional associations located in SA 6A. These donations will be to assist with their core missions, which foster access to care, and in collaboration with Cornerstone to provide educational content on end-of-life care. Separate Foundation Account: Cornerstone will donate $25,000.00 to a segregated account for SA 6A maintained and controlled by the Cornerstone Hospice Foundation. Additionally, all donations made to Cornerstone or the Foundation from SA 6A, or identified as a gift in honor of a patient served in the 6A program, shall be maintained in this segregated account and only used for the benefit of patients and services in Hillsborough. This account will be used to meet the special needs of patients in Hillsborough which are not covered under the Medicare hospice benefit and cannot be met through insurance, private resources, or community organization services or programs. Continuing Education Programming (CEUs): Cornerstone will commit to extending free CEU in- services to the healthcare community in Hillsborough. Topics will cover a wide range of both required and pertinent subjects and will include information on appropriate conditions and diagnoses for hospice admission, particularly for non-cancer patients. A minimum of 10 in-services will be offered in a variety of healthcare settings during each of the first five years. Additional CEU will be provided on an ongoing basis. In addition to formulating CON conditions, Cornerstone used information gleaned from its community exploration to develop an operational plan detailing the number and type of staff to hire, which programs to offer, and how to tailor its outreach and education to best enhance access to hospice services in Hillsborough to meet the unmet need. Given Cornerstone’s existing outreach to area providers in Hillsborough, such as Moffitt, Tampa General Hospital, and the VA, which already discharge patients to Cornerstone in neighboring service areas, Cornerstone fully expects that it will receive referrals to its hospice from providers throughout Hillsborough upon the initiation of operations in the county. Cornerstone will provide hospice services to those and any other patients throughout Hillsborough from day one. However, when seeking to expand access in new or existing markets, Cornerstone focuses not on taking patients from existing providers but on enhancing access to groups and populations that have been overlooked, or whose needs are not otherwise being met by existing hospices. Cornerstone therefore developed a phased operational plan to focus its outreach and education efforts on areas where there are barriers to access, rather than simply scattering their efforts haphazardly or concentrating on areas that already have a heavy hospice presence. Phase One of Cornerstone’s operational plan will begin immediately upon licensure and continue through the first six months of operation. During this time, Cornerstone will focus outreach and education efforts heavily on the underserved southeast portion of Hillsborough, including Plant City, Valrico, Brandon, Riverview, Mango, and Sun City Center. Phase One includes 68 ALFs, six SNFs, and four hospitals. Almost one-third of the population of Hillsborough resides in this area, and an estimated 28 percent of the residents are Hispanic, and 14 percent are African American. There is also a large, underserved migrant population in this area. Cornerstone conditioned its application on opening an office in Brandon during this initial phase in the first year of operation. Phase Two will expand Cornerstone’s targeted outreach efforts into the southwest quadrant of Hillsborough, including the Apollo Beach, Ruskin, Gibsonton, Progress Village, and Palm River areas. While the population of this phase is smaller than Phase One, the two areas combined make up almost a third of the county’s Hispanic population, and a fourth of the county’s African American population. Phase Three will reach into the broader Tampa area, including towns such as Temple Terrace, Pebble Creek, University, Ybor City, and Carrollwood. This is the largest and most populated of the four phases; however, it is also currently the most hospice-penetrated area of the county as the two existing providers, LifePath and Seasons, each have offices in Phase Three. There is also a hospice house and two hospice inpatient units in the area as well. Because this area already has better hospice visibility and access, and to avoid siphoning patients from existing providers, Cornerstone will focus on this area after Phases One and Two. Cornerstone will ramp up its outreach staffing consistent with the increased area, facilities, and population added during Phase Three. Combined, the first three phases of the operational plan will offer enhanced outreach and education to 90% of the Hillsborough population starting at the beginning of year two operations. Phase Four will encompass the remainder of the county to the west of Tampa in the Town ‘n’ Country area. While this area represents only about 10% of the county’s population, Phase Four has no hospice visibility currently in the form of hospice offices, hospice houses, or hospice inpatient units. Cornerstone has conditioned its application on establishing an office in the Town ‘n’ Country area within project year two to enhance hospice visibility and access in this area of the county. Upon implementation of Phase Four, Cornerstone’s targeted outreach and education will be fully integrated throughout the county. Cornerstone’s application included more than 174 letters of support for its proposal. The letters of support are from a broad range of individuals and facilities located within and outside Hillsborough, including families, SNFs, ALFs, hospitals, vendors, and local charitable organizations, among others. Cornerstone presented testimony from three authors of letters of support, Andrea Kowalski, Eric Luetkemeyer, and Colonel (Ret.) Gary Clark. Ms. Kowalski is an employee benefits coordinator for USI Insurance Representatives in Tampa who works with Cornerstone to build benefits programs for its employees. In addition to authoring her own letter of support, Ms. Kowalski also assisted in gathering approximately 40 additional letters of support for Cornerstone from her colleagues in Hillsborough. Ms. Kowalski strongly supports Cornerstone’s approval and indicated the community would benefit not only from enhanced access to Cornerstone’s excellence and expertise in caring for those with advanced illness, but also from the addition of a highly-regarded employer, which will provide additional options for healthcare workers and financial benefits as Cornerstone reinvests in the community. Mr. Leutkemeyer is the COO for Spectrum Medical Partners (“Spectrum”), the largest privately-held hospitalist group in Florida. Spectrum manages roughly 400 providers across the state, the majority of which (85%) are medical doctors or doctors of osteopathic medicine, either in hospital or post-acute settings, and sees roughly 2,000 patients per day. Spectrum’s footprint includes coverage in Hillsborough for entities such as Simply or Humana with which Spectrum contracts statewide. Spectrum is looking to expand its footprint and services in Hillsborough in the near future. As detailed in his letter, Mr. Luetkemeyer supports Cornerstone’s efforts to establish a hospice program in Hillsborough, indicated a desire to work with Cornerstone in the county if awarded, and believes the community would benefit from the additional resources and quality care that Cornerstone would provide. Colonel Clark, who retired from the United States Air Force in 1993, is co-founder and current Chairman of the Polk County Veterans Council, a volunteer organization of individuals interested in assisting veterans. Colonel Clark is also affiliated with, and participates in, a number of veterans organizations in Hillsborough, including as an adviser to the Mission United Suncoast Chapter in Hillsborough, which primarily assists veterans in transitioning from service to the civilian world. He also serves on the management advisory committee of James A. Haley Veterans’ Hospital in Tampa, which provides a broad spectrum of hospital-based care to area veterans. Colonel Clark has significant experience with Cornerstone through its participation in the Polk County Veterans Council, including on the Council’s committee for the Flight to Honor program, which provides veterans a flight to Washington D.C. to visit war memorials. If a veteran is unable to make the flight, a virtual flight and tour, as well as ceremonies or presentations, are provided by Cornerstone to veterans enrolled in hospice. Cornerstone is heavily involved in the Council’s Flight to Honor program— participating on the committee, recruiting volunteers, working with local schools to gather letters for the veterans on the flights, arranging for orientation prior to the flights, and putting on the virtual flights for those Veterans unable to make the flight due to various disabilities. Colonel Clark is also familiar with Cornerstone’s efforts to support veterans at James A. Haley Veterans’ Hospital in Tampa. Colonel Clark described Cornerstone’s support not only for veterans but for the community overall as “magnificent,” and detailed his support for Cornerstone’s application in a letter of support that is included in Cornerstone’s application. Cornerstone is well-positioned to quickly establish a successful hospice program to enhance access in Hillsborough, and its proposal is a carefully considered, long range plan that would bring its established and proven processes, procedures, and programs to the residents of the county. Cornerstone also posits that its existing presence nearby in Lakeland will enhance its ability to topple barriers to care and serve patients in adjacent SA 6A immediately. For example, Cornerstone has existing relationships with veterans groups that serve both Polk and Hillsborough, and will utilize those relationships to enhance access to the large veteran population in Hillsborough, as highlighted through Cornerstone’s condition to provide services tailored to the veteran community. VITAS VITAS, which operates a hospice program in adjacent SA 6B, proposes to expand into SA 6A under its existing license. This will allow VITAS to begin serving patients quickly without creating an entirely new administrative infrastructure for the opening. Although VITAS provides many of the same core programs in each of its service areas, it also recognizes that each community is different. VITAS performed a qualitative and quantitative assessment that examined the specific needs of Hillsborough regarding hospice care and services. Through its consultants and internal team, VITAS identified several communities, patient types, and clinical settings that are underserved in SA 6A. These include: the African American, Hispanic, and migrant communities, particularly those age 65 and older; impoverished, food insecure and homeless communities; patients with non-cancer diagnoses such as pulmonary disease, cardiac disease, Alzheimer’s Disease, and patients with sepsis; cancer patients in need of palliative care; high acuity patients in need of complex services and those needing admissions during evenings and weekends; patients requiring admission after hours and on weekends; and patients who reside in nursing homes and small ALFs. To understand the hospice needs within Hillsborough, VITAS conducted a two-step review—(1) analyzing data from a wide variety of sources including Medicare, AHCA, Florida Department of Elder Affairs, Florida CHARTS, and demographic and socioeconomic data; and (2) meeting with some healthcare and social service providers in Hillsborough. Key members of VITAS’s leadership team, including Patty Husted, Mark Hayes, and Dr. Shega, conducted an assessment in Hillsborough to identify the unmet need within the community and underserved populations. VITAS’s needs assessment team physically went into Hillsborough to visit nursing homes, ALFs, hospitals, and physicians to determine the unmet need and how to achieve greater access to hospice services for the residents of Hillsborough. VITAS’s team spent a significant amount of time conducting hospice outreach and education in Hillsborough in furtherance of the needs assessment. Specifically, VITAS’s team met with hospitals including H. Lee Moffitt Cancer Center, Baptist Health, BayCare, St. Joseph’s, and Brandon Regional; nursing homes, such as Hudson Manor, Ybor Health and Rehabilitation Center; and physician and nurse practitioner groups. VITAS’s needs assessment team also participated in physician advisory council meetings as part of its needs assessment for Hillsborough. During these meetings, VITAS gained perspective from these local physicians regarding the challenges faced by patients in need of hospice services in SA 6A, as well as insight as to what VITAS could bring from its existing programs to fill the unmet needs. VITAS also drew on the knowledge of the 18 VITAS employees currently living in Hillsborough. To address the needs it identified in SA 6A, VITAS proposes a broad array of programs and services to be offered in Hillsborough which are specifically targeted to increase the availability and accessibility of hospice services for underserved groups and Hillsborough residents more broadly. To demonstrate its commitment, VITAS conditioned its CON application on providing the following 20 programs and services in SA 6A: VITAS Pulmonary Care Program. VITAS Cardiac Care Program. Clinical research and support for caregivers of patients with Alzheimer’s and dementia. VITAS Sepsis Care Program. Veterans programs, including achieving Level 4 commitment to the We Honor Veterans program within the first two years of operation in SA 6A. Bridging-the-Gap Program and Medical/Spiritual Toolkit, which is an outreach and end-of-life education tool for African American and other minority communities. ALF Outreach and CORE Training Program. Palliative care resources and access to complex and high acuity services, including engaging area residents with serious illness in advance care planning and goals of care conversations, as well as offering palliative chemotherapy, inotrope drips and radiation to optimize pain and symptom management as appropriate. Provider clinical education programs for physicians, nurses, chaplains, HHA’s and social workers. Quality and Patient Satisfaction Program, including hiring a full-time Performance Improvement Specialist within the first six months of operation dedicated to supporting quality and performance improvement programs for the 6A hospice program. VITAS staff training and qualification, ensuring the medical director covering SA 6A will be board-certified in hospice and palliative care medicine. Hospice office locations. Deployment of a mobile van to increase access and outreach to rural counties. VITAS will not solicit donations. Outreach and end-of-life education for 6A residents experiencing homelessness, food insecurity, and limited access to healthcare, including advanced care planning for area homeless shelter residents and a partnership to provide a grant for housing and food assistance with a community organization. $5,000 will be distributed during the first two years to the Hispanic Services Coalition or similar qualified organization for promoting academics, healthy communities and engagement of Latinos. Outreach program for underserved residents of SA 6A. Educational grant, to the University of South Florida Foundation including $250,000 for fellowships, scholarships, education and workforce development as well as $20,000 for diversity initiatives. Inpatient hospice house and shelter for natural disasters and hurricanes. Medicaid Managed Care education Services beyond the hospice benefit, including, among others: 24/7 Telecare Program and access to admission on evenings and weekends, including outreach and end-of-life education for residents experiencing poverty, food insecurity, homelessness and/or food insecurity, including nutrition services, advanced care planning for shelter residents, and housing assistance. Hospice Education and Low Literacy (HELLO) Program. Multilingual education materials in several languages including Spanish, Chinese, Korean, Portuguese, Russian, Vietnamese and Creole. CAHPS Ambassador Program to generate interest, awareness and encourage ownership by team members of their team’s performance on CAHPS survey results. Community outreach and education programs. Partnership with a local college for fellowships, scholarships, education and workforce development and diversity initiatives. VITAS’s application contains approximately 50 letters supporting its proposed program, the vast majority of which are from hospitals, nursing homes, ALFs, physicians, and community organizations in Hillsborough County with direct hospice experience. VITAS obtained these letters of support as part of its community-oriented needs assessment, and they attest to the community’s confidence in VITAS’s ability to meet hospice care needs in Hillsborough. Included are letters of support from Cynthia Chavez, Executive Director at Hudson Manor Assisted Living; Brian Pollett, Administrator at Ybor Health and Rehabilitation Center; and Dr. Jorge Alfonso, Regional Chief Medical Officer at Dedicated Senior Medical Center. All three providers expressed a local need to address high acuity patients, including greater access to continuous home care. Statutory and Rule Review Criteria The review criteria are found in sections 408.035, 408.037, and 408.039, and rules 59C-1.008 and 59C-1.0355. (Prehearing Stipulation). Section 408.035(1) - Need for the health care facilities being proposed There are currently two licensed hospice programs in hospice SA 6A, and a need for one additional hospice program, as calculated using the need methodology found in rule 59C-1.0355(4), and published by AHCA, without challenge. AHCA’s need calculation compares reported hospice admissions during the base year with projected admissions in the horizon year and finds need if the difference between base and horizon year admissions exceeds 350, assuming there are no recently-licensed or CON-approved hospice programs in the service area. In this case, AHCA’s calculation revealed a net need of 863 hospice admissions for the January 2021 planning horizon. Each Applicant has put forth a proposal to meet the calculated need for one additional hospice program in Hillsborough. None of the applicants are advocating the approval of more than one new program. Section 408.035(2) – Availability, quality of care, accessibility, and extent of utilization of existing health care facilities and health services in the service district. It is undisputed that quality hospice services are available in Hillsborough today through existing providers LifePath and Seasons, including for patients of all ages and with essentially all end-stage disease processes, as well as for patients of all demographic groups. Relevant data demonstrates discharges to hospice in Hillsborough for a wide range of diagnoses and demographic groups, including African American and Hispanic patients, non-cancer and cancer patients, both over and under age 65; patients with end-stage cardiac disease; end-stage pulmonary disease and dementia, including Alzheimer’s disease, among others. However, despite the availability of quality hospice services, some patients simply are not accessing hospice services at the rate expected in SA 6A, as reflected by low penetration rates and low discharge-to-hospice rates, particularly within certain major disease categories and demographic groups, including Hispanic and African American residents. All three applicants agreed that the underutilization is concentrated among certain patient populations, including demographic groups and disease groups. Generally, all three applicants agreed that the Hispanic, African- American, veteran, and homeless populations are currently underserved in Hillsborough. In addition, Suncoast points to the need for a specialized pediatric hospice program in SA 6A; Cornerstone argues that non-cancer patients younger than age 65 are in need of enhanced access, as are residents of smaller ALF’s; and VITAS asserts that patients with respiratory, sepsis, cardiac, and Alzheimer’s diseases are underserved, as are patients requiring continuous care and high acuity services, such as high-flow oxygen. VITAS’s argument is based largely on a claim that the existing providers are not providing “any measurable continuous care,” as well as hearsay reports from area hospitals indicating a lack of high-acuity services available through existing hospice providers. However, VITAS’s health planning expert conceded that, in fact, existing providers are offering continuous care, and she was unable to quantify any purported dearth of continuous care in Hillsborough as compared to other providers or the statewide average. The record establishes that continuous care is part-and- parcel of the hospice benefit, and there was no evidence presented at final hearing to support the claimed lack of availability of that service from existing providers. Based on the foregoing, the evidence tended to show quality hospice care is available in SA 6A, that it is underutilized, and that the underutilization is driven by accessibility challenges among particular patient groups, and supports AHCA’s determination that another hospice program is needed in Hillsborough. Section 408.035(3) - Ability of the applicant to provide quality ofcare and the applicant’s record of providing quality of care Cornerstone is the only applicant accredited by the Joint Commission, which is a national symbol of quality that reflects its commitment to meeting high quality performance standards. Cornerstone’s Joint Commission accreditation, which was just recertified in 2020, and the accompanying high standards of quality care, will carry over to its new SA 6A program. As a new entity, Suncoast is not Joint Commission accredited, but conditions its application on achieving such accreditation by the end of year two. Suncoast Pinellas is Joint Commission accredited, and indeed, is one of only a handful of hospices nationwide, along with Cornerstone, to hold Joint Commission accreditation and/or certification. While VITAS represents that some affiliated VITAS hospice programs are Joint Commission accredited, VITAS, the applicant here, is not accredited by the Joint Commission, and makes no representation that it will seek or attain such accreditation for its new hospice program in SA 6A. There are two universal metrics codified in federal law that are used as a proxy for assessing the quality of care offered by hospice programs— Hospice Item Set (“HIS”) scores and Consumer Assessment of Healthcare Providers and Systems (“CAHPS”) survey scores. See 42 C.F.R. § 418.312; see also § 400.60501, Fla. Stat. (2020). CAHPS surveys are a subjective metric sent to family members and other caregivers months after a patient's death. The survey asks respondents to provide ratings like: “would definitely recommend,” “would probably recommend,” “would probably not recommend,” and “would definitely not recommend.” It also seeks yes or no responses to statements like: the hospice team “always communicated well,” “always provided timely help,” “always treated the patient with respect,” and “provided the right amount of emotional and spiritual support.” It also asks if the patient always got the help they needed for pain and symptoms, and if “they” received the training they needed. The CAHPS survey was created by CMS in conjunction with the Agency for Healthcare Research and Quality to measure and assess the care experience provided by a hospice. The purpose of the Hospice Compare Website is to allow the public to compare quality scores for CAHPS among different hospice providers. CAHPS scores are one measure of quality that is intended to allow for comparison across hospice programs. Significant time at final hearing was dedicated, through multiple witnesses, to discussing the strengths and weaknesses of CAHPS scores as a measure of quality. Ultimately, the greater weight of the evidence supports that CAHPS scores are an indicator of quality, but are not the only consideration, and suffer from limitations that prohibit drawing distinctions from minor differences in scores. The three applicants’ CAHPS scores are summarized in this chart: (Suncoast Ex. 42, BS p. 12203) While it is true that Suncoast Pinellas’s scores on all CAHPS measures are higher than those of Cornerstone, the slight difference between Suncoast Pinellas and Cornerstone is not significant given the subjective nature of the survey instrument. However, both Suncoast Pinellas and Cornerstone do score significantly higher than VITAS on most measures. Cornerstone’s CAHPS scores meet or exceed state averages on six of the eight measures, are within one to three points of the state average on the remaining two measures, and its average CAHPS score exceeds the state average. As a new entity, Suncoast does not have CAHPS scores. Suncoast Pinellas’s CAHPS scores meet or exceed state averages on six of the eight measures, are within one to two points of the state average on the remaining two measures, and its average CAHPS score exceeds the state average. In contrast, VITAS’s CAHPS scores fall below the state average on all eight metrics, fall five to seven points below the state average on seven of the eight metrics, and its average CAHPS score for all measures combined falls five points below the state average. Cornerstone and Suncoast Pinellas are within one to three points of each other on every CAHPS metric. The difference in scores between Cornerstone and Suncoast Pinellas is not statistically significant or meaningful, particularly given the shortcomings of CAHPS scoring. VITAS’s CAHPS scores are below both Cornerstone and Suncoast Pinellas, falling six and eight points below Cornerstone and Suncoast Pinellas, respectively, on the average of all CAHPS metrics. This difference is meaningful, particularly when viewed in the context of VITAS’s history of substantiated complaints discussed below. HIS scores, which assess documentation of various items, are more a process or compliance measure than a quality measure. Suncoast Pinellas’s HIS scores exceed the state and national average on all metrics, albeit most scores are within two points of the state average. Cornerstone’s HIS scores are on par with state averages on most metrics and meet or exceed the national average on every metric, except Pain Assessment. Cornerstone has worked to substantially improve its Pain Assessment score through better documentation protocols, raising its score from 52.1 to 89.1 in the last few years, and is implementing a new Electronic Records Management system to further improve its scores. VITAS’s HIS scores are on par with state averages on most metrics, and meet or exceed the national average on all metrics except Visits When Death Imminent. VITAS scores 68.4 on Visits When Death Imminent compared to the state and national averages of 83.2 and 82.4, respectively. As measured by the HIS scores, there was no credible, persuasive testimony establishing a meaningful difference among the three applicants. In contrast to CAHPS and HIS scores, the number and substance of complaints substantiated against each applicant by AHCA is a more direct indicator of quality of care. Suncoast has no prior hospice operations history, and therefore no prior substantiated complaints. Suncoast Pinellas has had only three substantiated complaints since 2008, and none since 2013. Cornerstone has only two substantiated complaints since 2008, and only one since Mr. Lee took over as CEO of Cornerstone in late 2012. VITAS has 73 substantiated complaints since 2008, including 10 substantiated complaints in the three years ending November 20, 2019, just prior to submission of the CON application at issue here. Between November 20, 2019, and June 17, 2020, VITAS had five additional substantiated complaints. VITAS’s health planning expert, Ms. Platt, also considered all AHCA survey deficiencies, whether based upon a complaint, life safety survey, or otherwise. Ms. Platt’s analysis demonstrates that VITAS had 80 such surveys with deficiencies since 2012, including 26 between January 2018 and June 2020. VITAS argues that its greater number of substantiated complaints are the consequence of higher patient volumes than Suncoast and Cornerstone. However, even taking into consideration the greater number of patient days provided by VITAS, VITAS had infinitely more surveys with deficiencies in 2019 than Cornerstone, which had zero. And VITAS had five times as many surveys with deficiencies for 2018 and 2019 as Cornerstone. A comparison of VITAS to Suncoast Pinellas yields similar results, with VITAS having significantly more surveys with deficiencies than Suncoast Pinellas, even when taking into consideration the greater number of patient days provided by VITAS. Complaints substantiated against VITAS demonstrate failures in many areas of patient care, including some of the specific aspects of hospice care at which VITAS claims to excel beyond other providers, such as after- hours care, the provision of continuous care, and care to patients wherever they live, including smaller ALFs. For example, a substantiated complaint against VITAS in November 2019 included a finding of “immediate jeopardy”—the most severe level of deficiency possible—for a patient who failed to receive proper care after-hours at end-of-life, resulting in a particularly painful death for the patient, and an excruciating experience for the patient’s daughter who witnessed her mother’s painful death, unaccompanied by hospice personnel. Two additional substantiated complaints from January and February 2020 found deficiencies in VITAS’s care to patients on continuous care, including one where the VITAS nurse had headphones in and was not paying attention when the patient fell. Indeed, VITAS’s own internal review of the substantiated complaint involving the patient who fell confirmed an upward trend in falls among VITAS patients. And, as recently as June 2020, a separate substantiated complaint found that VITAS abandoned a patient on continuous care, requiring the patient to be transferred to the hospital rather than continue to receive care in the “small ALF” where the patient resided. VITAS acknowledged the patients at issue in the substantiated complaints discussed at final hearing did not receive quality hospice care. Those five examples are only a sampling of the complaints substantiated against VITAS, and the others demonstrate similar quality deficiencies. The number of substantiated complaints weighs in favor of Cornerstone and Suncoast, and heavily against VITAS with regard to record of providing quality of care. There is no meaningful difference between Cornerstone and Suncoast in regard to substantiated complaints, and neither is entitled to preference in this regard. On balance, among the three applicants, the quality of care provided by Suncoast and Cornerstone is on equal footing, with both having a distinct advantage over VITAS. Section 408.035(4) - Availability of resources, including health personnel, management personnel, and funds for capital and operating expenditures, for project accomplishment and operation; and Section 408.035(6): The immediate and long-term financial feasibility of the project The parties stipulated that each of the applicants have available funds for capital and operating expenditures in the short term for purposes of project accomplishment and operation. Suncoast demonstrated that it has the resources to accomplish its proposed project. Suncoast provided detailed descriptions of the personnel that would be required to successfully implement its proposed program. Suncoast has reasonably projected the types of staff necessary to operate Suncoast in year 1 and 2 of operation. At hearing, Suncoast witnesses credibly described the roles of the staff contained in Suncoast’s Schedule 6, including the roles of administrator, care team manager, administrative assistant, regional hospice scheduler, business development liaisons, physicians, program director, nurses, hospice aides, respiratory therapists, staff for the mobile van in Condition 2 of its application, community partnership specialists, social workers, patient social team lead, chaplain, volunteer coordinator, and senior staff nurse. Suncoast’s financial expert, Armand Balsano, testified that part of his role in preparing Suncoast’s CON application was working with Suncoast Pinellas’s Chief Financial Officer, Mitch Morel, to develop Suncoast’s financial projections that were included on Schedules 1 through 8 of the application. Mr. Balsano, in collaboration with Mr. Morel, utilized Suncoast Pinellas’s internal financial modeling system to develop the financial schedules and financial narrative for the application. Mr. Balsano credibly testified that financial Schedules 1 through 8 are accurate and reasonable. Suncoast projects admissions of 460 patients for project year one and 701 patients for project year two. Suncoast’s health planner, David Levitt, developed Suncoast’s projected admissions based on experience of other providers entering a market with two existing providers. Suncoast’s projected number of admissions for years one and two are reasonable projections of admissions for a new hospice program in Hillsborough. Suncoast was criticized as having a lackluster record for admissions in its existing Pinellas hospice. While it is true that Suncoast Pinellas’s admissions declined slightly from 2013 to 2014, the overall trend has been one of increasing admissions. For example, based on Medicare claims data, from 2005 to 2019, Suncoast Pinellas’s admissions grew from 4,679 to 6,534.10 Financial feasibility may be proven by demonstrating the expected revenues and expenses upon service initiation, and determining whether a shortfall or excess revenue results. The projection of revenue is not complicated for hospice services. The vast majority of hospice care, more than 90%, is funded by the Medicare Program which pays uniform rates to all hospice providers. Mr. Balsano testified that Suncoast’s projected revenues in Schedule 7 are based on the revenues that are currently realized for the various payer categories, including Medicare, Medicaid, Commercial, and self-pay. Mr. Balsano credibly testified that the assumptions reflected on Schedule 7 of Suncoast’s CON application are reasonable and appropriate. 10 Suggestions by VITAS and Cornerstone that Suncoast’s internal data indicate a history of low utilization or inaccurate reports to AHCA are without merit. Mr. Sciullo credibly testified that the data reported to AHCA is the most accurate admissions data. Mr. Sciullo further credibly testified that the Utilization Trend Reports contained in Cornerstone’s exhibits 82 through 88, relied on by VITAS and Cornerstone, contain duplicate hospice admissions and admissions from non-hospice programs such as Suncoast’s home health program. Mr. Sciullo also credibly testified that the most accurate admissions numbers reported to AHCA are not generated from the Utilization Trend Reports. Rather, the admissions numbers reported to AHCA are produced by Suncoast’s reimbursement department. Mr. Sciullo’s testimony under cross examination demonstrated a confident and credible understanding of the nuances of the Utilization Trend Reports. Additionally, the suggestion that Suncoast would intentionally under-report admissions to AHCA lacks credibility because hospice providers in Florida are incentivized to report higher numbers of admissions. In Year 2, Suncoast projects net operating revenue of $7,138,000, which breaks down to approximately $172 per day of overall net revenue per patient day. Mr. Balsano’s credibly testified that this is a reasonable forecast of net operating revenue. Projected expenses were also reasonably projected by Suncoast. Mr. Balsano testified that Suncoast’s projected income and expenses in Schedule 8A includes salaries and wages, fringe benefits, medical supplies and ancillary services, and approximately 1.5% of inpatient days. Suncoast also included a separate allowance for administrative and overhead cost. Suncoast also allocated $752,000 in management fees to account for “back office services” and other support services that would be provided to the Hillsborough program through the Empath home office. Mr. Balsano arrived at this number by determining that a reasonable assessment would be the cost per patient day of $18, as reflected on Schedule 8 for year two. Mr. Balsano credibly testified that, for a startup program, it is appropriate to include the costs associated with services provided by the corporate office because one must be cognizant of what services are provided locally, and what services will be provided through the corporate office. Mr. Balsano further testified that it would not be reasonable to assume that 100% of the costs associated with corporate services to a new hospice program would be fixed. As Mr. Balsano explained, the variable costs must be accounted for as well. Mr. Balsano credibly testified that Suncoast’s net profit in year two as reflected in Schedule 8A is $615,416. It is found that Suncoast has reasonably projected the revenues and expenses associated with its proposed hospice, and that Suncoast’s proposal is financially feasible in the long term. Cornerstone projected admissions of 448 patients in year one, and 819 patients in year two, for the highest year two admissions of the three applicants. In comparison, Suncoast projected admissions of 460 patients in year one and 701 in year two, while VITAS projected 491 patients in year one and just 593 in year two. Cornerstone’s projected admissions were developed by health planning experts Roy Brady and Gene Nelson based on the experience of recent new hospice programs in the state of Florida, were discussed and confirmed by Cornerstone personnel prior to being finalized, and are a reasonable projection of admissions for years one and two of operations in Hillsborough. Despite the highest anticipated year two admissions, Cornerstone’s projection still fell below the SA 6A service gap of 863 patients and therefore did not, standing alone, establish any greater adverse impact on area providers than Suncoast or VITAS. Cornerstone emphasized its mission as an organization, and intent for this proposal, to expand penetration by resolving unmet need as opposed to capturing patients already served by existing providers. The adverse impact analysis in Cornerstone’s application therefore represents a worst-case scenario by assuming all of its patients otherwise would be served by existing providers, a premise undercut by the substantial published need. Using this approach, Cornerstone anticipated that LifePath would bear the overwhelming burden of its entry into Hillsborough, with a projected adverse impact on LifePath of 408 patients in year one, and 747 in year two. Cornerstone anticipated adverse impact to Seasons of 39 patients for year one, and 72 patients for year two. Even in this worst-case scenario, existing [Remainder of page intentionally blank] providers’ volumes in Cornerstone project years one and two exceed their historical volumes.11 Cornerstone has available health personnel and management personnel for project accomplishment and operation. Cornerstone’s existing staff, as well as its projected incremental staff for the new program, is reflected in schedule 6A of its application. The projected incremental staff shown in schedule 6A is based on established ratios and methodologies Cornerstone uses in its existing hospice programs. The projected incremental staff is all the incremental staff Cornerstone will need to establish the new program in Hillsborough, and combined with its existing personnel, are sufficient to achieve program implementation as proposed in the application. Both Suncoast and VITAS criticized Cornerstone’s financial projections as flawed because they did not present the fully allocated costs of the project. According to Mr. Balsano, Cornerstone’s projected profit margin is unreasonable and, in fact, is “an extreme outlier.” As he explained, Cornerstone’s financial schedules make no allocation of shared service costs for critical services to be provided by the home office. According to Suncoast and VITAS, this omission is unreasonable when viewed in context with Cornerstone’s Schedule 6, which does not allocate any FTEs to back office support services. Not shown are the expenses Cornerstone will incur for finance, billing, revenue cycle, accounts receivable, payroll, human resources, 11 Relative adverse impact on existing hospice programs of competing applicants has been used as a dispositive factor for favoring one applicant over another. See, Hospice of Naples, Inc. v. Ag. for Health Care Admin., DOAH Case No. 07-1264, ¶ 274 (Fla. DOAH Mar. 3, 2008; Fla. AHCA Jan. 22, 2009) (“One factor outweighs all others, however, in favor of VITAS. VITAS's application will have much less impact on HON and its fundraising efforts and in turn on the high-quality services that HON presently provides in Service Area 8B.”). However, as noted here, neither of the existing providers presented evidence as to the relative impact that any of the applicants would potentially have on its existing operations, or whether such impacts would be material. Accordingly, there is no evidentiary basis for providing an advantage to one or another of the applicants based upon consideration of adverse impact. and contract negotiations, among others. Notably, hospice providers include home office costs as part of their Medicare cost reports filed with CMS.12 Because Cornerstone did not allocate home office costs in its application, its profit margins are substantially higher than all other applicants for the October 2019 Batching Cycle. While most applicants fall within the $100,000 – $500,000 range, Cornerstone projected a staggering $4.9 million profit margin. There is nothing in the CON application form or instructions that require that financial projections be presented on a “fully allocated” basis. Notably, in its review of the financial projections, AHCA determined that each applicant’s proposed program appeared to be financially feasible in the long-term. Cornerstone’s financial feasibility analysis included consideration of payer mix, level of service mix, admissions, average lengths of stay, patient days and incremental staffing needs, among others, and focused on the resulting incremental revenues and expenses generated by addition of the new program in Hillsborough. Cornerstone’s projected admissions are reasonable and appropriate for the proposed new program in Hillsborough. Cornerstone’s proposed incremental staff, combined with its existing staff, is sufficient for project accomplishment and operation. Cornerstone’s projected payer mix is based upon consideration of Cornerstone’s own historic experience, the demographics and recent hospice payer characteristics of Hillsborough, and consideration of Cornerstone’s goal to serve the non-cancer under-65 population, which may reduce Medicare 12 In terms of its budgeting process, Cornerstone has one “bucket” for its administrative overhead/home office expenses and then separate buckets for each of its hospice programs. Home office expenses include human resources, IT, compliance, and facility maintenance. Cornerstone does not allocate its home office expenses to each of its hospice programs within its internal books. However, when an audit is performed, the performances of each hospice program and the home office expenses are all included, and the home office expenses are allocated to each of its hospice programs. levels slightly from what they otherwise may be, and is reasonable and appropriate for its proposed hospice program in Hillsborough. Cornerstone’s projected level of service mix and average length of stay are based upon Cornerstone’s historical experience, and are reasonable and appropriate for the proposed hospice program in Hillsborough. Likewise, Cornerstone’s projected revenues as set forth in schedule 7A are based upon the projected volumes, service level mix, payer mix projections, and Medicare service level specific rates, and are a reasonable projection of revenues for the proposed project in Hillsborough. Cornerstone has established the long-term financial feasibility of its proposed SA 6A program. VITAS’s financial projections were prepared through the work of an internal team led by Lou Tamburro, Vice President of Development for VITAS. VITAS reasonably based these projections on the successful opening and ramp up of new hospice programs in Service Areas 1, 3E, 4A, 6B, 7A, 8B, and 9B, and other Florida communities. VITAS has a clear understanding of what startup costs will be, and it was appropriate for VITAS to rely on its past history of success in developing these projections. VITAS projects admissions of 492 patients for project year one and 593 patients for project year two. Mr. Tamburro developed the projected admissions using an internal model based upon VITAS’s prior experience. While Mr. Tamburro is an expert in health finance, not health planning, Ms. Platt reviewed VITAS’s projections and credibly concluded they are reasonable. VITAS proposes to dedicate more resources to SA 6A than the other two applicants in the second year of operations; 74% of that expense is focused on direct patient care, with only 23% associated with administrative and overhead, and 2% property costs. In contrast, Suncoast and Cornerstone only dedicate 54% and 56%, respectively, of their expenses on direct patient care and 41% and 42%, respectively, on administrative and overhead. However, VITAS’s higher direct patient care costs are at least partially explained by the larger number of clinical and ancillary FTE’s associated with the higher levels of continuous care projected by VITAS than either Suncoast or Cornerstone. As would be expected, VITAS also projects to admit a larger number of high acuity patients than Suncoast or Cornerstone. Given VITAS’s vast experience in the start-up and operation of hospice programs, including 16 within Florida, there is no reason to doubt that the VITAS Hillsborough program would be financially feasible in the long term. The following table summarizes the three applications’ financial metrics: Cornerstone Suncoast Vitas Total Project Costs $286,080 $703,005 $1,134,149 Operating Costs Yr.2 $6 million $5.7 million $8.6 million Net Profit Yr.2 $4,972,346[13] $615,416 $154,913 Proj. Admits Yr. 2 819 701 593 Routine Home Care 95.4% 97.5% 94% General Inpatient 3.5% 1.5% 2.5% Continuous Care 0.3% 0.5% 3.5% Respite 0.8% 0.5% 0% Section 408.035(5) The extent to which the proposed services will enhance access to health care for residents of the service district; and Section 408.035(7) The extent to which the proposal will foster competition that promotes quality and cost-effectiveness. Rule 59C-1.0355 and the criteria for determination of need for a new hospice program found within that rule, is predicated upon the notion that, 13 As noted, Cornerstone’s relatively large profit margin is a function of its incremental cost, versus fully allocated cost, financial projections. when need exists, approval of an additional program will foster competition beneficial to potential and prospective hospice patients in the service area. As between the three applicants, Suncoast did the most thorough and extensive analysis of the current needs of the Hillsborough population. This effort was driven by the fact that Suncoast had recently applied for a new hospice program in neighboring Pasco County, and was denied in favor of a competing applicant. In that case, Administrative Law Judge Newton specifically faulted Suncoast for failing to carefully evaluate the hospice needs of Pasco County residents: Suncoast, in effect, proposes a branch operation for Pasco County. Suncoast did not conduct the focused, individualized inquiry into the needs of Pasco County that Seasons did. Nor did it begin developing targeted ways to serve the needs or begin establishing relationships to further that service. The Hospice of the Fla. Suncoast v. Ag. For Health Care Admin., Case No. 18- 4986, ¶ 126 (Fla. DOAH Sept. 5, 2019; Fla. AHCA Oct. 16, 2019). As explained by Mr. Sciullo at hearing, Suncoast took the above criticism to heart, and determined to conduct an exhaustive evaluation of the hospice needs in SA 6A, and to formulate a strategy for addressing those needs. Specifically, Suncoast’s intent was to identify issues and gaps in services facing residents of Hillsborough, and to enable a dialogue with existing community partners and providers in order to create shared solutions. As part of this comprehensive effort, Suncoast met with more than 50 key individuals and organizations, representing a broad range of general and special populations within the county. This effort resulted in the development of collaborative strategies and action plans to fill the gaps and meet the unmet need for additional hospice services in Hillsborough, as reflected in the Suncoast application conditions. In contrast to Suncoast, Cornerstone did not conduct its own needs assessment, but rather relied on the community needs assessments prepared by the HCDOH and two area hospitals. Moreover, rather than reaching out to the Department of Health and to the area hospitals that prepared those assessments to conduct further research or seek their support of its CON application, Cornerstone simply “verified that their documentation was thorough enough.” Cornerstone’s limited outreach effort in Hillsborough is further demonstrated by the letters of support submitted with its CON application. While Suncoast obtained letters of support from the HCDOH and numerous hospitals and community organizations in Hillsborough, Cornerstone failed to obtain a single letter of support from any hospital in Hillsborough. Despite submitting approximately 150 letters of support (many of which were form letters, and letters from Cornerstone employees), Cornerstone failed to obtain any letters from the Hispanic community, the African American community, the HIV community, the migrant community, or organizations that assist the homeless, unlike Suncoast. As Mr. McLemore testified, “a large part” of the review criteria is “hav[ing] the commitment from the organizations in the service area. I think that’s where – a little bit where Cornerstone was a little off base. They did have a bunch of letters of support, but again, they were not specific to the service area.” Mr. McLemore further testified that, rather than a large pile of letters, he was looking for letters “that are definitely from hospitals, nursing homes and civic organizations, healthcare organizations in the area.” Cornerstone’s failure to conduct meaningful and thorough outreach efforts in Hillsborough is also demonstrated by its generic list of CON application conditions. As multiple Cornerstone witnesses acknowledged, the services Cornerstone is proposing to offer in Hillsborough are identical to the services Cornerstone already offers in its existing service areas. Specifically, Cornerstone conditions its application on Hispanic outreach, bilingual volunteers, multiple office locations within a service area, complementary therapies, veterans-specific programming, bereavement counseling for parents, cooperation with local community organizations, a separate foundation account for the specific service area, and continuing education programming, all of which are services that Cornerstone already offers in its existing service areas. Thus, unlike Suncoast, which used the existing community health needs assessments as a starting point for its own comprehensive needs assessment, and proposed conditions that are reflective of the unique needs of Hillsborough, the conditions proposed by Cornerstone are almost identical to the services Cornerstone currently provides elsewhere. Cornerstone’s plan to serve Hillsborough in phases does not immediately address the unmet need for hospice services countywide. Cornerstone will not send its marketing team to facilities and other referral sources in those phased areas until Cornerstone has completed each phase of its plan. Although Cornerstone’s witnesses testified that Cornerstone will not turn away referrals from parts of the county before Cornerstone begins operations in those areas, they also confirmed that Cornerstone will not actively seek referrals from other phased areas until it is ready to move into those areas. Unlike Suncoast, and to a lesser extent VITAS, there is no evidence that Cornerstone conducted a thorough needs assessment of SA 6A before developing its phased implementation plan. Cornerstone simply looked at a map of where existing providers have offices and decided to start elsewhere. Likewise, Cornerstone did not conduct any independent assessment of the needs of the four different geographic areas of its plan to determine whether Cornerstone will be capable of serving all of the county’s residents immediately upon CON approval. Further, Cornerstone did not conduct any review or analysis of comparable start-ups in Florida when preparing its SA 6A CON application. VITAS undertook an analysis of information from a variety of sources, including meetings with various individuals within Hillsborough regarding the perceived gaps in care. Based on this review, VITAS identified a number of patient groups with purported unmet needs: African American and Hispanic populations; migrant workers; patients residing in the eastern and southern parts of the county who are not accessing hospice at the same rate as other parts of the subdistrict; patients with respiratory, sepsis, cardiac, and Alzheimer’s diagnoses; patients requiring continuous care and high acuity services such as Hi-Flow oxygen; patients requiring admission in the evening or on weekends; and patients residing in small, less than 10-bed, ALFs. VITAS proposed a number of solutions to address the purported needs identified in Hillsborough, and largely included those proposed solutions as conditions of its application. However, VITAS failed to identify a specific operational plan for Hillsborough. The purported gaps in care and solutions identified in VITAS’s application for Hillsborough largely mirror those identified in its application for Service Area 2A that was submitted during the same cycle, despite significant differences between the makeups of those two service areas. VITAS’s application included 47 letters of support. Many of the letters are from persons and organizations outside Hillsborough, and even include a letter from one of VITAS’s employees, Kellie Newman, and two letters in support of its 2A application. At hearing, VITAS offered testimony from letter of support authors Mary Donovan and Margaret Duggar. Ms. Donovan lives in Miami and is VP for Caregiver Services, Inc., a nurse staffing agency that contracts with VITAS in other areas of the state and hopes to do so in Hillsborough. Ms. Duggar is the President of MLD & Associates, Inc., located in Tallahassee, which is a management firm that serves as executive staff for a number of entities. Neither of these letters is probative of VITAS’s ability to meet the hospice needs of Hillsborough residents. Ultimately, the applicants all agreed that the unmet need in SA 6A is not purely numeric: it is concentrated among certain patient populations, including Hispanic and migrant communities; non-cancer patients under age 65, including those with dementia, Alzheimer’s, respiratory, and cardiac disease; and lower income groups. Each applicant tailored their proposal to address the perceived, underlying access barriers accordingly. Two primary theories concerning the source of access barriers in Hillsborough developed at final hearing: (a) that access barriers, and hence, unmet need in the service area stem from a lack of access to relevant hospice services through existing providers once a patient has entered hospice care; and (b) that access barriers, and hence, unmet need in Hillsborough, stem from a lack of outreach and education necessary to bring awareness of hospice services to Hillsborough residents so that they access hospice services in the first place. All three applicants proposed to tailor their hospice services and programming to the particular residents of Hillsborough. But Suncoast’s proposal and conditions focused more heavily on outreach and education to bring geographically and culturally-driven awareness of the hospice benefit to patients appropriate for hospice. As noted, Suncoast also did a more comprehensive needs analysis, which allowed Suncoast to focus its CON conditions on those segments of the Hillsborough population most in need of improved access to hospice services. Among the applicants, Suncoast alone proposes to implement a dedicated pediatric hospice program, which is not currently offered in Hillsborough. Dr. Stacy Orloff, accepted as an expert in pediatric hospice care, confirmed in her testimony the following: Suncoast's pediatric hospice program includes a dedicated integrated care team comprised of a fulltime pediatric nurse with more than 25 years’ hospice experience, a pediatric medical director, a full-time licensed social worker, a team assistant, a volunteer coordinator and a pediatric team leader. Additionally, there are part-time staff members including LPNs and CNAs with dedicated pediatric hospice experience. This is an important distinction, as many hospice programs claim to provide pediatric hospice services, but oftentimes they utilize the same care teams that provide care for adult patients. Suncoast's longstanding expertise and network of community partners for its pediatric program will ensure that the proposed pediatric hospice program fits the specific needs of the pediatric patient and family. Suncoast will use a combination of existing staff and PRN assistance until the pediatric caseload is large enough to warrant addition of new team members in Hillsborough County. Suncoast's existing pediatric hospice team has a strong relationship with St. Joseph's Children's Hospital, which it will utilize to expand its network of pediatric providers to increase hospice awareness and utilization in Hillsborough. Suncoast conditions its application on purchasing a $350,000 mobile van, the “Empath Mobile Access to Care,” to conduct mobile outreach activities in Hillsborough for ethnic-specific programming and outreach to homeless. VITAS also conditioned its application on a “Mobile Hospice Education Unit” van, and included photos of similar vans that it operates in other service areas. The Suncoast van will be staffed by a full-time bilingual LPN and a full-time social worker prepared to discuss advanced care planning and education, and will be equipped with telehealth technology capable of linking with the Empath Care Navigation Office. In contrast, VITAS did not explain how its van will be staffed, or whether any of the staff will be clinicians. Indeed, from the photos included in the application, the van appears to be more of a mobile advertisement for VITAS, than it does a tool for hospice education and outreach. VITAS attempted to differentiate its proposal by pointing to disease- specific programming for patients with pulmonary and cardiac conditions, Alzheimer’s, and sepsis. But, Cornerstone and Suncoast are also capable of caring for patients with those conditions. And, specific to sepsis programming—a feature of VITAS’s presentation at final hearing— septicemia is not usually the primary reason a patient enrolls in hospice. Instead, sepsis is a complication of another terminal condition for which a patient is admitted to hospice, and therefore does not represent a need unto itself. VITAS further attempted to differentiate its program by pointing to its comparatively longer average length of stay, arguing that longer average lengths of stay are indicative of greater access and quality. However, this notion was countered by credible testimony that longer lengths of stay, along with a higher percentage of live discharges and higher 30-day readmission rate, may, alternatively, represent targeting of patients unlikely to experience the types of access barriers at which CON is aimed, and may be indicative of lower quality and higher costs. And VITAS’s healthcare planning expert did not conduct an analysis, and offered no opinion, as to the specific cause of VITAS’s comparatively longer length of stay. Taken together, the evidence was inconclusive as to whether longer lengths of stay reflect access enhancements generally, or as applied to VITAS’s proposal. Section 408.035(9) - The applicants’ past and proposed provision of health care services to Medicaid patients and the medically indigent. Rule 59C-1.0355(2)(f) provides that hospice services must be available “to all terminally ill persons and their families without regard to age, gender, . . . cost of therapy, ability to pay, or life circumstances.” Consistent with rule, hospice providers must provide care to Medicaid patients. Medicaid pays essentially the same for hospice care as does Medicare. As such, there is no financial disincentive to accept Medicaid hospice patients. VITAS and Cornerstone both have a history of providing Medicare, Medicaid, and medically-indigent care; Suncoast’s affiliated entity, Suncoast Pinellas, has a similar history, and all three applicants propose to provide care to Medicare, Medicaid, and the medically indigent. While the three applicants project that they will experience different payor mixes for Medicaid and indigent patients, there is no evidence in this record that any of the applicants have discriminated against such patients in the past, or would do so in their Hillsborough program. Cornerstone argues that it is entitled to preference over Suncoast because Cornerstone’s projected percentage of Medicaid and medically indigent admissions (6%) is almost double that of Suncoast (3.3%). However, Cornerstone’s projection is exactly that: a projection of the payor mix it may experience in its new program. Significantly, Cornerstone did not commit to a 6% Medicaid/indigent payor mix within its CON conditions, and therefore that level of Medicaid/indigent admissions is unenforceable. Rather than the applicants’ projected payor mixes, what is significant are plans to reach out to the Medicaid and charity care population to improve their knowledge about, and use of, hospice services. Suncoast’s application presents a specific plan for doing exactly that. All of the applicants have proposed programs for outreach to financially disadvantaged communities within Hillsborough, and none of the applicants are entitled to preference under this criterion. Rule 59C-1.0355(4)(e) – Preferences for a New Hospice Program.Preference shall be given to an applicant who has a commitment to serve populations with unmet needs. Each applicant expressed a commitment to provide hospice services to populations with unmet needs. And to a greater or lesser extent, each applicant conducted an analysis of the specific populations with unmet needs in Hillsborough. No evidence was presented to establish that care for hospice patients with the varying identified conditions or within the various demographic groups is not available in Hillsborough. Rather, the evidence demonstrates that patients are not accessing hospice services, despite their availability to residents of Hillsborough. Among the three applicants, Suncoast best demonstrated a plan for enhancing access to quality hospice care for these populations, as well as a track record of past experience with enhancing access to quality hospice services for these populations. Preference shall be given to an applicant who proposes to provide the inpatient care component of the Hospice program through contractual arrangements. Each of the applicants propose to provide the inpatient care component of the hospice program through contractual arrangements, and presented testimony regarding their ability to do so. Likewise, all three applicants presented letters from entities in Hillsborough regarding their purported willingness to contract for the inpatient care component of the hospice program. However, no applicant presented non-hearsay evidence from any entity within Hillsborough regarding a willingness to contract for the inpatient care component of the hospice program. The applicants are on equal footing in terms of the ability to contract for inpatient care. Notwithstanding its intention to provide the inpatient component of the hospice program through contractual arrangements, VITAS conditioned its application on applying for a CON to construct an inpatient hospice house within the first two years of operation. However, VITAS presented no evidence to establish the need for an additional inpatient hospice house in SA 6A, and no evidence was presented to demonstrate that an inpatient hospice house is a more cost-effective alternative to contracted beds. The proposals by Cornerstone and Suncoast to contract for the inpatient component of the hospice program represent a better use of existing resources than that of VITAS, which will incur the expense of a freestanding hospice house for its proposed program. On balance, this preference weighs equally in favor of Cornerstone and Suncoast, and against VITAS. Preference shall be given to an applicant who has a commitment to serve patients who do not have primary caregivers at home; the homeless; and patients with AIDS. Each applicant presented evidence of a commitment to serve patients who do not have primary caregivers at home; the homeless; and patients with AIDS. However, the programs proposed by Suncoast to address the needs of these populations are more precisely targeted than those of the other applicants, and Suncoast is therefore entitled to preference. Proposals for a Hospice service area comprised of three or more counties. SA 6A is comprised of a single county, Hillsborough. This preference is therefore not applicable in this case. Preference shall be given to an applicant who proposes to provide services that are not specifically covered by private insurance, Medicaid, or Medicare. All three applicants propose to provide services in Hillsborough that are not specifically required or paid for by private insurance, Medicaid, or Medicare. The added services beyond those covered by private insurance, Medicaid, or Medicare as proposed by the applicants differ slightly, but on balance, weigh equally in favor of approval of each applicant. Rule 59C-1.0355(5) – Consistency with Plans. Each of the applicants conducted an analysis of the needs of Hillsborough residents and included evidence within their applications and through testimony at final hearing regarding the consistency of their respective plans with the needs of the community. However, Suncoast’s evaluation of the needs specific to Hillsborough was more thorough, and its application is best targeted at meeting the identified needs. Rule 59C-1.0355(6) – Required Program Description. Each applicant provided a detailed program description in its CON application. The elements of the program descriptions are discussed above in the context of the various statutory and rule criteria. Ultimate Findings Regarding Comparative Review Suncoast conducted the most comprehensive evaluation of the end of life care needs of Hillsborough residents, and developed targeted programs and services to address those needs. Those programs and services are identified as CON conditions, and are enforceable by AHCA. The depth and breadth of Suncoast’s commitments to the residents of Hillsborough exceed those of Cornerstone and VITAS. Unlike the other applicants, Suncoast offers needed programs which are not currently available in Hillsborough, including a dedicated pediatric hospice program, and enhanced transportation options for persons living in rural areas of the county. Suncoast and Cornerstone are comparable in terms of history of providing quality care. VITAS is inferior in this regard, as evidenced by the numerous confirmed deficiencies in recent years. Undoubtedly, VITAS has redoubled its efforts to improve quality in response to the numerous confirmed deficiencies and complaints, but based upon the record in this case, Suncoast and Cornerstone have a better history of providing quality care. Suncoast would be able to commence operations in SA 6A more quickly than Cornerstone or VITAS. It has connections with other healthcare providers in Hillsborough and could easily transition to that adjacent geographic area. All three proposals would enhance access to hospice services in the county, but Suncoast’s program would be the most effective at enhancing access. A careful weighing and balancing of the statutory review criteria and rule preferences favors approval of the Suncoast application, and denial of the Cornerstone and VITAS applications. Upon consideration of all the facts in this case, Suncoast’s application, on balance, is the most appropriate for approval.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered approving Suncoast Hospice of Hillsborough, LLC’s, CON No. 10605 and denying Cornerstone Hospice and Palliative Care, Inc.’s, CON No. 10602 and VITAS Healthcare Corporation of Florida’s, CON No. 10606. DONE AND ENTERED this 26th day of March, 2021, in Tallahassee, Leon County, Florida. COPIES FURNISHED: D. Ty Jackson, Esquire GrayRobinson, P.A. 301 South Bronough Street, Suite 600 Post Office Box 11189 Tallahassee, Florida 32302 Seann M. Frazier, Esquire Parker, Hudson, Rainer & Dobbs, LLP Suite 750 215 South Monroe Street Tallahassee, Florida 32301 Kristen Bond Dobson, Esquire Suite 750 215 South Monroe Street Tallahassee, Florida 32301 Marc Ito, Esquire Parker Hudson Rainer & Dobbs, LLP 215 South Monroe Street, Suite 750 Tallahassee, Florida 32301 S W. DAVID WATKINS Administrative Law Judge 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 26th day of March, 2021. Julia Elizabeth Smith, Esquire Agency for Health Care Administration Mail Stop 3 2727 Mahan Drive Tallahassee, Florida 32308 Stephen A. Ecenia, Esquire Rutledge, Ecenia & Purnell, P.A. Suite 202 119 South Monroe Street Tallahassee, Florida 32301 Gabriel F.V. Warren, Esquire Rutledge Ecenia, P.A. 119 South Monroe Street, Suite 202 Post Office Box 551 Tallahassee, Florida 32301 Elina Gonikberg Valentine, Esquire Agency for Health Care Administration Mail Stop 7 2727 Mahan Drive Tallahassee, Florida 32308 Amanda Marci Hessein, Esquire Rutledge Ecenia, P.A. Suite 202 119 South Monroe Street Tallahassee, Florida 32301 Allison Goodson, Esquire GrayRobinson, P.A. Post Office Box 11189 Tallahassee, Florida 32302 Maurice Thomas Boetger, Esquire Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 Richard J. Shoop, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 James D. Varnado, General Counsel Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 Thomas M. Hoeler, Esquire Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 Jonathan L. Rue, Esquire Parker, Hudson, Rainer and Dobbs, LLC Suite 3600 303 Peachtree Street Northeast Atlanta, Georgia 30308 D. Carlton Enfinger, Esquire Agency for Health Care Administration Mail Stop 7 2727 Mahan Drive Tallahassee, Florida 32308 Simone Marstiller, Secretary Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 1 Tallahassee, Florida 32308 Shena L. Grantham, Esquire Agency for Health Care Administration Building 3, Room 3407B 2727 Mahan Drive Tallahassee, Florida 32308
The Issue The issue is whether Respondent properly determined that there is a numeric need for one additional hospice program in health planning Service Area 2B for the January 2003 planning horizon pursuant to a revised fixed need pool projection.
Findings Of Fact AHCA is the state agency that is responsible for administering the CON program and laws in Florida. In conjunction with these duties, AHCA determines, on a semi-annual basis, the net numeric need for new hospice programs pursuant to Rule 59C-1.0355(4), Florida Administrative Code (the Rule). AHCA then publishes such need in the Florida Administrative Weekly. Community volunteers began organizing BBH in 1981. After its incorporation in 1983 as a not-for-profit community organization, BBH commenced operation under a license that authorized it to provide hospice services only in SA 2B, consisting of the following eight counties: Franklin, Gadsden, Jefferson, Leon, Liberty, Madison, Taylor, and Wakulla. On average, BBH serves 162 patients per day. Its main office is located in Tallahassee, Florida, but it operates the following branch offices and/or community centers: Franklin County at Carrabelle, Florida; Gadsden County at Quincy, Florida; Jefferson County at Monticello, Florida; Madison County at Madison, Florida; and Taylor County at Perry, Florida. BBH also operates a twelve-bed inpatient facility, The Hospice House, located in Tallahassee, Florida. Covenant, formerly known as Hospice of Northwest Florida, is a not-for-profit community organization that was founded by a committee in 1982. Covenant began treating its first patients in 1984 and is currently licensed to provide hospice services in SA 1 and SA 2A. The following counties are located in SA 1: Escambia, Santa Rosa, Okaloosa, and Walton. The following counties are located in SA 2A: Holmes, Washington, Jackson, Calhoun, Bay and Gulf. Covenant also is licensed to provide hospice services in 26 southern Alabama counties. On average, Covenant serves 429 Florida hospice patients per day. Its main office and its eight-bed inpatient facility are located in Pensacola, Florida. Covenant operates the following Florida branch offices: Okaloosa County at Niceville, Florida; Jackson County at Marianna, Florida, and Bay County at Panama City, Florida. Covenant operates Florida community centers in Okaloosa County at Crestview, Florida, and in Walton County at Destin, Florida. The Hospice CON Rule and Need Methodology The Rule establishes criteria and standards for assessing the need for new hospice programs. The Rule includes a numeric need formula for determining whether a new hospice is needed in a particular SA. In this case, AHCA used the following data sources to produce need projections: (a) population projections from the Executive Office of the Governor; (b) mortality data as reported in the applicable Florida Vital Statistics Annual Report from the Department of Health's Office of Vital Statistics; and (c) utilization data based on the number of hospice patients served by all licensed hospice programs in the SA as reported by licensed hospice programs. Under the Rule, numeric need is demonstrated if the projected number of unserved patients who would elect a hospice program is 350 or greater. The Rule targets 350 as the minimum number of patients that should be admitted to a hospice program in a 12-month period. Pursuant to the Rule, AHCA calculates need for additional facilities and services every six months or twice annually. The numeric need formula contained in the Rule is a conditional formula, which works as follows: If HPH minus HP is equal to or greater than 350, then a net numeric need exists. HPH is the projected number of patients who will elect hospice services in a particular SA during the 12-month period beginning in the planning horizon. Specifically, HPH is the sum of (U65C X P1) + (65C X P2) + (U65NC X P3) + (65NC X P4). U65C is the projected number of SA resident cancer deaths under age 65. U65C is calculated by dividing the current annual number of cancer deaths under age 65 by the current annual total of resident deaths, and multiplying the result by the SA's projected annual total of resident deaths at the planning horizon. P1 is the projected proportion of U65C who will be hospice patients. P1 is calculated by dividing the current 12-month statewide total of hospice admissions under age 65 with cancer by the current statewide total of deaths under age 65 from cancer. 65C is the projected number of SA resident cancer deaths age 65 and over. 65C is calculated by dividing the current annual number of cancer deaths age 65 and over by the current annual total of resident deaths, and multiplying the result by the SA's projected annual total of resident deaths at the planning horizon. P2 is the projected proportion of 65C who will be hospice patients. P2 is calculated by dividing the current 12-month statewide total of hospice admissions age 65 and over with cancer by the current statewide total of deaths age 65 and over from cancer. U65NC is the projected number of SA resident deaths under age 65 from all causes except cancer. U65NC is calculated by dividing the current annual number of deaths under age 65 from all causes except cancer by the current annual total of resident deaths, and multiplying the result by the SA's projected annual total of resident deaths at the planning horizon. P3 is the projected proportion of U65NC who will be hospice patients. P3 is calculated by dividing the current 12-month total of hospice admissions under age 65 with diagnoses other than cancer by the current statewide total of deaths under age 65 from causes other than cancer. 65NC is the projected number of SA resident deaths age 65 and over from all causes except cancer. 65NC is calculated by dividing the current annual number of deaths age 65 and over from all causes except cancer by the current annual total of resident deaths, and multiplying the result by the SA's projected annual total of resident deaths at the planning horizon. P4 is the projected proportion of 65NC who will be hospice patients. P4 is calculated by dividing the current 12-month statewide total of hospice admissions age 65 and over with diagnoses other than cancer by the current statewide total of deaths age 65 and over from causes other than cancer. In other words, HPH is a projection of the number of persons who will elect hospice care in a particular SA, irrespective of their normal place of residence. It is a compilation of projected hospice usage for four age and diagnostic classes. Thus, the need methodology and need projection is specific to the particular demographics and diagnostic experiences of a SA. HP represents the number of admissions to hospice programs serving a SA during the most recent 12-month period ending on June 30 or December 31. The number is derived from reports on standardized forms submitted to AHCA by licensed hospice programs every six months. The Rule uses a statewide use rate as a normative standard for each age and diagnostic category. The use rate is a ratio of the hospice admissions in a particular age and diagnostic class to deaths in the same age and diagnostic class for the state as a whole. When applied to any particular hospice SA, the use rate projects what the hospice admissions should be in that SA, based upon the performance of the state as a whole, rather than the actual historical penetration rate in the SA. The need methodology thus provides that the hospice penetration rate in a SA should equal the state average penetration rate. The need methodology does not assume that the level of hospice services being provided in a particular area is sufficient to meet the needs of the area. This is appropriate because hospice is a fast-growing and relatively new service that has been widely available only since the early 1980s. Not only has there been a rapid increase in hospice penetration rates but also there is a wide variation in hospice penetration from SA to SA. The numeric need formula set forth in the Rule provides a reasonable and appropriate methodology to project need for additional hospice services. In this case, AHCA's procedures for collecting and analyzing data and for calculating numeric need were consistent with the Rule. Publication of the Fixed Need Pools AHCA initially published the "Florida Need Projections for Hospice Programs: Background for Use in Conjunction with the July 2001 Batching Cycle for the January 2003 Hospice Planning Horizon." The initial publication resulted a numeric need in SA 2B of 340. In other words, there was no net numeric need for an additional hospice program in SA 2B. AHCA subsequently published a revision to the fixed need pool after it was notified of some errors in the data used in the numeric need calculation. The errors principally involved AHCA's failure to update the population data from a previous batching cycle. The necessity of a revised publication created an opportunity for hospices to submit revised admissions data, which was then incorporated into the second computations of the need methodology. Several hospices took advantage of this opportunity. Using the revised data, AHCA determined that the projected number of hospice admissions in SA 2B would be 1209 patients (HPH = 1209). AHCA also determined that the number of patients served by SA 2B's licensed provider, BBH, for the relevant period was 858 patients (HP = 858). The difference between these calculations was 351, indicating a need for an additional hospice program in SA 2B. AHCA published the revised fixed need pool determination on August 17, 2001. Counting Admissions At issue here is the definition and use of the term "admissions" on AHCA's semiannual utilization report form (report form). Item 1 on the report form indicates that hospice providers should show the "[n]umber of patients admitted to your program (unduplicated) for the following categories " The reporting block also indicates that the data to be included are "New Patients Admitted." The term "unduplicated" means admissions in the reporting period, exclusive of those from a prior reporting period. In other words, the same admission is not counted and reported twice. For example, a patient initially admitted in one reporting period, subsequently discharged, and readmitted in the following reporting period should be reported as an admission in the prior reporting period and as an admission in the following reporting period. Likewise, a patient who initially is admitted, discharged, and subsequently readmitted in the same reporting period is counted as two admissions. This is true whether the second admission occurs in the same SA or in a different SA and whether the second admission is to the same or a different hospice provider. The second admission relates to the same patient but is counted as a "new patient admitted" each time the patient is admitted as long as the same admission is not counted twice on a report form. The counting of unduplicated admissions is consistent with the language of the Rule, which requires hospice providers to "indicate the number of new patients admitted during the six- month period . . . ." It also is consistent with the language of the Rule that requires the report form to show "[t]he number of admissions during each of the six months covered by the report by service area of residence." The "service area of residence" is not defined by the Rule. AHCA interprets the term to mean the location of patients when they are admitted regardless of the place that they consider their permanent residence. AHCA's interpretation of the term "service area of residence" is reasonable and appropriate. The fact that admissions are counted for each SA regardless of a patient's normal place of residence, while resident death data is derived from information contained in death certificates showing the deceased person's permanent residence (no matter where the death occurred) does not change this result or improperly skew the hospice use rates. In the course of treatment, a hospice patient may account for two or more admissions to the same or another hospice, in the same or another service area, during a period of time that covers two reporting periods. This could happen for a number of reasons, including but not limited to the following: (a) a patient may temporarily decide that he or she no longer desires hospice services resulting in an admission, a discharge, and second admission to the same or another hospice in the same or another SA; (b) a patient may decide to relocate and receive services in another SA with the same or another hospice resulting in separate admissions in both SAs; and (c) a patient may elect to transfer from one hospice to another hospice in the same SA resulting in a separate admission for each hospice. All Florida hospices, including BBH, count a patient as having generated two admissions when the patient is admitted, discharged, and readmitted to the same hospice in the same SA. They also count a patient as having generated a second admission when the patient transfers or relocates to their hospice from another hospice in the same or another SA. AHCA's report form requires hospices that serve multiple SAs to separate their admissions by SA to enhance the verisimilitude of the counts. Twelve hospice providers, including Covenant, serve multiple SAs in Florida. Under the Rule, multiple SA providers, like Covenant and unlike BBH, count admissions when a patient transfers from the provider's program in one SA to the same provider's program in another SA. The ability to count an admission in both SAs when a patient transfers from one SA to another SA but continues to receive services from the same hospice, does not result in impermissible "double counting" or give multiple SA providers a competitive edge. To the contrary, it is consistent with AHCA's interpretation of an unduplicated admission. More importantly, AHCA's methodology of counting of such admissions is consistent with the method that Medicare uses to count admissions and with the way AHCA counts admissions in determining numeric need for nursing homes, hospitals, and open-heart programs. For the reporting period at issue here, Covenant reported zero admissions based on transfers of its patients between SA 1 and SA 2A. Moreover, there is no persuasive evidence that allowing any multiple SA provider to count transfers of its patients from one of its SAs to another of its SAs as two separate admissions has adversely impacted the fixed need pool determination in this case. Covenant is not the only hospice provider in SA 1 and SA 2A. No doubt, some patients in one of Covenant's SAs transferred to and from Covenant and the alternate providers in SA 1 and SA 2A or other Florida SAs with no corresponding death being recorded in one of Covenant's SAs. Covenant surely served some Alabama patients who sought hospice care in Florida but whose deaths were not counted as resident deaths in any Florida SA. At least for the calendar years 1999 and 2000, Covenant experienced a net in-migration of patients while BBH experienced a net out-migration of patients for the same periods. Even so, there is no persuasive evidence that in- migration and out-migration of patients has affected the validity of the numeric need at issue in this proceeding. AHCA consistently has counted admissions in this manner since the Rule was adopted and implemented. Counting admissions by "service area of residence" as interpreted by AHCA ensures that all patients served are counted, even those who are homeless or have a permanent residence in another state. AHCA's interpretation of an admission based on "service area of residence" also is consistent with Section 400.601(6), Florida Statutes, which provides that hospice services may be provided in "a place of temporary or permanent residence used as the patient's home . . . ." Thus, a patient's residence could be a private home, an assisted living facility, a nursing home, or a hospital regardless of the location of the patient's legal or permanent residence. The State of Florida has an interest in knowing how much hospice care is provided in each SA. The application of the Rule promotes that interest because HPH projects the number of patients in a particular SA who will choose hospice care in the applicable time frame. HP is the number of patients admitted to hospice programs during the most recent 12-month period. HPH and HP measure the utilization of hospice care in a SA and not the number of residents of an SA who will elect hospice care or who are admitted to hospice care. In calculating the numeric need in this case, the number of admissions was based on data for the year ending June 2001. The resident deaths were based on data for the period ending December 2000. The time periods do not match because the Rule requires AHCA to use the most recent mortality data from the Department of Health's Office of Vital Statistics. The time periods are never the same and can differ from six months to one year. Thus, there is no intent under the Rule to have a one-to-one correspondence between the deaths that are used in determining the P factors and the admissions that are multiplied by the factors. Every SA in the state is treated consistently. No SA is disadvantaged by this characteristic of the Rule's need methodology. The batching cycle at issue here is the only one since the Rule was implemented that showed a fixed need for another hospice program in SA 2B. Until now, AHCA has never preliminarily approved any applicant where the net numeric need was only 351. The numeric need projection made in April 2002 showed no fixed need in SA 2B for another hospice program. None of these facts serve to undermine the validity of AHCA's determination of numeric need in this case. The Revised Fixed Need Pool Determination The initial fixed need pool projection published by AHCA did not indicate that there was a numeric need for an additional hospice in SA 2B. However, the initial publication was based on incorrect population projections. AHCA published a revised fixed need pool projection based, in part, on the updated and most current population data. That revision alone would have resulted in a numeric need for an additional hospice program in SA 2B, i.e. HPH - HP equaled 350. However, other corrections also were made based on revisions to semiannual utilization reports of several hospices. BBH's revised report form increased its HP number by four. Another hospice, Hospice of Southwest Florida, reported a substantial revision. The total revisions resulted in a numeric need for one additional hospice program in SA 2B because HPH - HP equaled 351. The revised fixed need pool determination was correctly calculated in accordance with AHCA's application and interpretation of all rules relating to fixed need pool determination. AHCA's interpretation and application of the rules is reasonable and appropriate. Therefore, the fixed need pool projection at issue here is valid and correct. As discussed below, there is no persuasive evidence that BBH over-reported its admissions. BBH's Reported Admissions An admission consists of several components: (a) a physician's diagnosis and prognosis of a terminal illness; (b) a patient's expressed request for hospice care; (c) the informed consent of the patient; (d) the provision of information regarding advance directives to the patient; and (e) performance of an initial professional assessment of the patient. At that point, the patient is considered admitted. A patient does not have to sign an election of Medicare benefits form for hospice care prior to being deemed admitted. BBH reported 858 admissions for the July 2000 through June 2001 reporting period. These admissions included patients who had completed the admission process outlined above. For accounting and billing purposes only, BBH separates its admissions into patients who have authorized the election of Medicare benefits and those who have not made that election. For the latter group, BBH uses the acronym WAP as a billing code. BBH provides WAP patients with services but does not bill them for those services because BBH is unable to report them to Medicare for reimbursement. BBH does not bill patients for services that it has no intention of collecting. In fact, BBH's billing department initially logs all patients in as WAPs. BBH's admission policy states that patients who will not be accepting services immediately should be entered as a WAP with reasons and follow-up dates to initiate regular services. The admission specialist at BBH enters a patient as a WAP then gets the attending physician's signature on the interdisciplinary care plan and certification of terminal illness. The admission specialist also requests the patient's medical record and completes the other admission steps. The WAP designation is not removed until the admission process is complete and the patient has elected the Medicare benefit. The WAP patient is not counted as an admission for purposes of reporting to AHCA until the admission process is complete. Occasionally, a WAP patient dies before the admission process is complete. In that case, the patient is not counted as an admission. Sometimes a WAP patient dies after completing the admissions process but before electing the Medicare benefit or receiving any additional hospice services. It is not necessary for a hospice to develop a plan of care in order for a patient to be considered admitted. An admitted patient has a right to choose or refuse additional services. In such a case, the patient is still counted as an admission for purposes of reporting to AHCA. BBH's practice of including WAP patients who have completed the admission process in its count of admissions is consistent with AHCA's interpretation of the Rule. AHCA's interpretation of the Rule is reasonable and appropriate in this regard. The fact that 10 percent of BBH's admissions are WAP patients while Covenant has no such patients does not change this result. BBH's financial department also is responsible for submitting reports to the Department of Elder Affairs (DEA). Therefore, BBH has filed reports with DEA consistent with its Medicare reports and has not included the WAP patients.
Recommendation Based on the foregoing Findings of Facts and Conclusions of Law, it is RECOMMENDED: That AHCA enter a final order determining the fixed need pool for SA 2B for the January 2003 planning horizon to be one. DONE AND ENTERED this 7th day of November, 2002, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD 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 7th day of November, 2002. COPIES FURNISHED: J. Robert Griffin, Esquire J. Robert Griffin, P.A. 2559 Shiloh Way Tallahassee, Florida 32308 Michael O. Mathis, Esquire Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building Three, Suite 3431 Tallahassee, Florida 32308-5403 W. David Watkins, Esquire R. L. Caleen, Jr., Esquire Watkins & Caleen, P.A. 1725 Mahan Drive, Suite 201 Post Office Box 15828 Tallahassee, Florida 32317-5828 Lealand McCharen, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 Valda Clark Christian, General Counsel Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building, Suite 3431 Tallahassee, Florida 32308
The Issue Whether Petitioner is entitled to recover certain Medicaid funds paid to Respondent pursuant to section 409.923(1), Florida Statutes, for hospice services Respondent provided through three program locations (Melbourne, Boynton Beach, and Dade) during the audit period between September 1, 2009, and December 31, 2012; and the amount of sanctions, if any, that should be imposed pursuant to Florida Administrative Code Rule 59G-9.070(7)(e).
Findings Of Fact Parties AHCA is the state agency responsible for administering the Florida Medicaid Program. § 409.902, Fla. Stat. (2018). Medicaid is a joint federal and state partnership to provide health care and related services to certain qualified individuals. Vitas is a provider of hospice and end-of-life services in Florida. During the relevant periods, Vitas maintained hospice programs headquartered in Melbourne, Dade, and Boynton Beach, each enrolled as a Medicaid provider with a valid Medicaid provider agreement with AHCA. Hospice Services Hospice is a form of palliative care. However, hospice care is focused upon patients at the end-of-life-stage, while palliative care is for any patient with an advanced illness. Both hospice and palliative care patients are generally among the sickest patients. Hospice is focused upon serving the patient and family to provide symptom management, supportive care, and emotional and spiritual support during this difficult period when the patients are approaching their end-of-life. Hospice care, as with Vitas, uses an interdisciplinary team ("IDT") to provide comfort, symptom management, and support to allow patients and their families to come to terms with the patient's terminal condition, i.e., that the patient is expected to die. Each patient is reviewed in a meeting of the IDT no less than every two weeks. For hospice, a terminally ill patient must choose to elect hospice and to give up seeking curative care and aggressive treatments. At all times relevant to this proceeding, Vitas was authorized to provide hospice services to Medicaid recipients. As an enrolled Medicaid provider, Vitas was subject to federal and state statutes, regulations, rules, policy guidelines, and Medicaid handbooks incorporated by reference into rule, which were in effect during the audit period. Medicaid Hospice Benefit Medicaid recipients are eligible to have their hospice services covered by Medicaid if a physician, using his/her clinical judgment, determines and certifies that the patient is terminally ill with a life expectancy of six months or less if the disease runs its normal course. See 42 C.F.R. §§ 418.3 and 418.22. The Florida Medicaid Hospice Services Coverage and Limitations Handbook, the January 2007 edition ("Handbook"), governs whether a service is medically necessary and meets certification criteria for hospice services. Pages 2 through 4 of the Handbook identify six areas of documentation (often referred to throughout this proceeding as "the six bullet points") for a physician to consider when making a determination regarding a patient's initial certification for hospice eligibility. These include: Terminal diagnosis with life expectancy of six months or less if the terminal illness progresses at its normal course; Serial physician assessments, laboratory, radiological, or other studies; Clinical progression of the terminal disease; Recent impaired nutritional status related to the terminal process; Recent decline in functional status; and Specific documentation that indicates that the recipient has entered an endstage of a chronic disease. The Medicaid hospice provider must provide written certification of eligibility for hospice services for each patient. The Handbook also provides certification of terminal illness requirements as follows: For each period of hospice coverage, the hospice must obtain written certification from a physician indicating that the recipient is terminally ill and has a life expectancy of six months or less if the terminal illness progresses at its normal course. The initial certification must be signed by the medical director of the hospice or a physician member of the hospice team and the recipient's attending physician (if the recipient has an attending physician). For the second and subsequent election periods, the certification is required to be signed by either the hospice medical director or the physician member of the hospice team. Certification is required for each election period. A patient may elect to receive hospice services for one or more of the election periods. The election periods include: an initial 90-day period; a subsequent 90-day period; and subsequent 60-day time periods. The Handbook provides guidance regarding the election periods as follows: The first 90 days of hospice care is considered the initial hospice election period. For the initial period, the hospice must obtain written certification statements from a hospice physician and the recipient's attending physician, if the recipient has an attending physician, no later than two calendar days after the period begins. An exception is if the hospice is unable to obtain written certification, the hospice must obtain verbal certification within two days following initiation of hospice care, with a written certification obtained before billing for hospice care. If these requirements are not met, Medicaid will not reimburse for the days prior to the certification. Instead, reimbursement will begin with the date verbal certification is obtained . . . . For the subsequent election periods, written certification from the hospice medical director or physician member of the interdisciplinary group is required. If written certification is not obtained before the new election period begins, the hospice must obtain a verbal certification statement no later than two calendar days after the first day of each period from the hospice medical director or physician member of the hospice's interdisciplinary group. A written certification must be on file in the recipient's record prior to billing hospice services. Supporting medical documentation must be maintained by the hospice in the recipient's medical record. AHCA's Audit Florida law obligates AHCA to oversee the activities of Florida Medicaid recipients and providers in order to ensure that fraudulent and abusive behavior occur to the minimum extent possible and, when appropriate, to recover overpayments and impose sanctions on providers. § 409.913, Fla. Stat. Among other duties, AHCA is required to conduct (or cause to be conducted) audits to determine possible fraud, abuse, and overpayments in the Medicaid program. § 409.913(2), Fla. Stat. The statutes define "overpayment" as "any amount that is not authorized to be paid by the Medicaid program whether paid as a result of inaccurate or improper cost reporting, improper claiming, unacceptable practices, fraud, abuse, or mistake." § 409.913(1)(e), Fla. Stat. When an overpayment is identified, AHCA is required to recover the overpayment and impose sanctions as appropriate. § 409.913, Fla. Stat. When making a determination that an overpayment has occurred, the agency shall prepare and issue an audit report to the provider showing the calculation of overpayments. § 409.913(21), Fla. Stat. The Department of Health & Human Services, Centers for Medicare and Medicaid Services ("CMS"), contracted with HI to perform an audit of Vitas on AHCA's behalf. HI, in turn, retained a PRO, Advanced Medical Reviews ("AMR") to provide physician reviews of claims during the audit process in order to determine whether an audited claim was eligible for payment. HI is an approved Medicaid Integrity Contractor that is assigned by CMS to Florida and was instructed to perform audits of Florida hospice providers who had been paid with Medicaid funds for the audit period. HI received the Medicaid billing information from AHCA and developed an audit plan in conjunction with AHCA MPI staff. Per Vitas' Medicaid Provider Agreements, Vitas agreed "to comply with local, state, and federal laws, as well as rules, regulations and statements of policy applicable to the Medicaid program, including Medicaid Provider Handbooks issued by AHCA." To that end, Vitas also agreed to maintain its records for at least five years to satisfy all necessary inquiries by AHCA. The stated objective of the audit, as reflected in the FARs, was "to determine whether the recipients met eligibility for hospice services and payments were in accordance with applicable Federal and State Medicaid laws, regulations, and policies." For the purpose of the audit, the recipient files to be reviewed were selected using the following criteria: The recipient was not dually eligible (eligible for both Medicaid and Medicare); and The hospice coverage was greater than or equal to 182 days based on the recipient's first and last date of service within the audit period. In addition, HI excluded recipients who had at least one malignancy (cancer) primary diagnosis and had a date of death less than one year from the first date of service with this provider. HI, in its capacity as an authorized contractor of CMS, contacted Vitas and requested medical files for those 250 recipients who met HI's selection criteria for the audit. HI then forwarded the 250 recipients' medical files to HI nurse claims analysts for initial detailed review. If, after review of Vitas' medical records, the HI claims analyst determined that a recipient was eligible for Medicaid hospice services, the analyst would clear the file and remove it from further consideration. As a result, 63 files were determined to have sufficient documentation to support approval of the claim. If, however, based upon the initial review, the analyst had any questions or concerns about a particular file, he or she would set it aside for later peer review by an independent physician who would make the ultimate determination with regard to hospice eligibility. In this case, 187 recipients' medical records were peer-reviewed by a physician who made a determination concerning whether the medical records supported the recipient's eligibility for Medicaid hospice. Of the 187 files, 118 were determined to be ineligible in whole or part for Medicaid hospice. HI contracts with PROs, which provide physicians to perform the peer review. Initially, HI contracted with AMR to provide peer review services. Section 409.9131(2)(c), provides that a "peer" is "a Florida physician who is, to the maximum extent possible, of the same specialty or sub-specialty, licensed under the same chapter, and in active practice." Often recipients in hospice care see multiple physicians. HI staff, therefore, reviewed the recipients' medical records to determine the names of Respondent's physicians treating the recipients whose medical records were being audited. Thereafter, HI staff obtained the specialty or subspecialty of Respondent's physicians from the Florida Department of Health, Board of Medicine, website. The most common specialties were Internal Medicine and Family Medicine. HI instructed AMR to appoint peers who are: (1) licensed in Florida, (2) in active practice, and (3) to the maximum extent possible have a specialty in Internal Medicine or Family Medicine. In this case, HI, through AMR, initially employed the services of five Florida physicians who reviewed the 187 recipient files at issue. The findings of the peer reviewers were presented in the Draft Audit Reports ("DARs"). Physicians Tania Velez, M.D. (specializing in family medicine), Terese Taylor, M.D. (specializing in family medicine), and Anita Arnold, D.O. (specializing in cardiovascular disease, interventional cardiology, and internal medicine), discontinued providing services as peers following the publication of their opinions in the DARs. These physicians were initially responsible for reviewing 25 recipient files. Todd Eisner, M.D. (specializing in internal medicine and gastroenterology), reviewed and rendered his opinion as to the hospice eligibility of five recipients in the DARs. Ankush Bansal, M.D. (specializing in internal medicine), reviewed the hospice eligibility of 88 recipients. Subsequent to the petitions being filed in this matter, Dr. Bansal opted to no longer participate in this matter. AHCA, therefore, requested HI to have all of Dr. Bansal's cases re- reviewed by another peer physician. AMR could not provide peer physicians who could complete the re-reviews in the desired time frame, so HI sent the re-reviews to another PRO, Network Medical Review ("NMR"). HI gave NMR the same instructions it gave to AMR with respect to how to select peers. HI, through NMR, selected Dr. Kelly Komatz (specializing in pediatrics, and hospice and palliative Care) and Dr. Charles Talakkottur (specializing in internal medicine) to perform the re-reviews of Dr. Bansal's claims. Dr. Komatz reviewed one patient file in dispute. Dr. Talakkottur reviewed 76 recipient files in dispute. Audit Methodology There is no statutory definition of "terminal illness" and no guidelines for the term are provided by rule or in the Handbook. In performing their respective peer reviews, the peer physicians were instructed to use their clinical experience, generally accepted medical standards, and the Handbook. Two peer reviewers with similar experience could review the same record and come to different conclusions as to a terminal diagnosis. The same goes for a determination as to a life expectancy of six months or less. Both are subjective by nature. Similarly, there are no AHCA guidelines to determine when the criteria of serial physician assessments, laboratory, radiological or other studies, have been met. The same is true for what constitutes sufficient documentation of clinical progression of the terminal disease, recent impaired nutritional status, recent decline in functional status, and specific documentation that a recipient has entered the end-stage of a chronic disease. Local Coverage Determinations ("LCDs") are Medicare guidelines that are disease specific and nationally recognized tools used to assist physicians in determining hospice eligibility. Florida does not use LCDs with respect to Medicaid. However, HI developed a document, titled the "Summary Lead Sheet—Medical Review Methodology Documentation/LCD's," which was approved by CMS. This documentation was then provided to AHCA and sent to the claims analysts and initial peer reviewers to perform their review of Medicaid reviews in this audit. To evaluate the likely terminality of a recipient's condition for benefit eligibility, LCDs direct physician reviewers to use certain clinical indicators including: Palliative Performance Scale ("PPS") scores; Functional Assessment Staging ("FAST") scores; Activities of Daily Living ("ADL") scores, which measure the patient's abilities in bathing, dressing, feeding, transferring, continence, and ambulation; Body Mass Index ("BMI"); and New York Heart Association ("NYHA") classifications. The Handbook makes no reference to LCDs or these clinical indicators. Nor does it prohibit their use. In fact, these clinical indicators are part of the "generally accepted standard of medical practice" to be considered in the context of "medical necessity" as defined by sections 409.913 and 409.9131. LCDs are not all-inclusive of all the different conditions for which a person may be eligible for hospice. Resultantly, LCDs are an appropriate tool to use in prognosticating whether a patient has a terminal illness with a life expectancy of six months or less. However, a patient's failure to meet the LCD for a specific disease does not per se disqualify the patient from Medicaid hospice eligibility. The peer reviewers were instructed, "Please do not break up a certification period with partial approved and partial denied dates." Pursuant to this instruction, if a patient meets hospice eligibility for any portion of a certification period, they should be approved for the entire period. None of the doctors involved in this case, from either side, actually examined the patients. All of the doctors conducted essentially a desk audit review of the medical records. Issuance of the DARs and FARs Based upon the peer reviews, DARs were prepared by HI, which identified overpayment of Medicaid claims totaling $6,943,664.74, relating to 118 recipients. The DARs were transmitted to Vitas. Vitas, through its medical directors, provided a response to the DARs. Vitas contested every alleged overpayment and maintained that all recipients in question were eligible for the Medicaid hospice benefit at all times. After receiving Respondent's responses, HI forwarded the responses to AMR so that the AMR peer review physicians could evaluate the responses and amend any of their conclusions, as appropriate. While the peer review physicians agreed with Vitas' responses in certain limited instances, the peer review physicians mostly disagreed, and, as a result, HI prepared the FARs. The FARs were then submitted to, and approved by, CMS. CMS provided the FARs to AHCA with instructions that Florida was responsible for furnishing the FARs to Vitas and initiating any state recovery process needed to collect the overpayment. The FARs prepared by HI contain the determinations of the peer review physicians concerning whether each of the recipients at issue had a terminal diagnosis with a life expectancy of six months or less if their disease progressed at its normal course. The FARs concluded that 92 recipients were ineligible for at least a portion of their stay with a cumulative overpayment of $5,401,615.18. Vitas timely filed three petitions, one for each location, with AHCA's agency clerk. On or about February 6, 2017, AHCA referred the three cases to DOAH. On February 14, 2017, the undersigned entered an Order of Consolidation, and the three cases are now proceeding under DOAH Case number 17-0792MPI. During the course of the underlying proceeding, the parties first stipulated that 67 of the original 92 recipients identified in the FARs were at issue. Throughout the course of these proceedings, however, the parties have moved closer and disputed less ineligibility determinations. As a result, of the original 250 recipients' medical files reviewed, only 61 remain in dispute. AHCA now seeks the revised overpayment of $3,847,755.95, with a corresponding reduction in the fines of $906,715.29 for a grand total of $4,754,471.24. The Experts Due to the nature of the review and "re-review" process, the vast majority of the final hearing was comprised of the testimony of each parties' experts regarding whether particular recipients met the criteria of Medicaid hospice benefit eligibility. For each recipient, an AHCA and a Vitas expert reviewed the medical records and provided an opinion as to whether the six bullet points of the Handbook were satisfied to determine whether the recipient was "terminally ill with a life expectancy of six months or less if the disease runs its normal course." The following physician experts were tendered and accepted for AHCA: Dr. Talakkottur, Dr. Eisner, and Dr. Komatz.1/ The following physician experts were tendered and accepted for Vitas: Dr. Shega and Dr. Vermette. Because the determinations of whether a recipient met the applicable criteria are highly subjective, it is important to distinguish between the relative qualifications of the experts. AHCA's Experts Dr. Talakkottur Dr. Charles Talakkottur was presented by AHCA as an expert in internal medicine. He has maintained an active practice in Florida for over nine years and reviewed and issued his opinion as to the hospice eligibility of 76 recipient files in dispute. Of those 76 recipient files, Dr. Talakkottur initially determined that 59 recipients were ineligible for at least a portion of the period that Vitas billed for hospice Medicaid services. In subsequent reviews, Dr. Talakkottur overturned two more files, leaving 57 recipients ineligible for at least a portion of the Medicaid services billed by Respondent. As discussed above, negotiations continued between the parties during the course of the final hearing. This resulted in Dr. Talakkottur testifying about 48 of the remaining disputed recipients' Medicaid hospice eligibility. Dr. Talakkottur admits patients to hospice from his practice, which requires him to make the type of prognosis determination, such as those at issue in this proceeding. However, Dr. Talakkottur is not now nor ever has been board- certified in hospice and palliative medicine. He has never been a Certified Hospice Medical Director. He has never signed a certification for hospice eligibility nor worked for a hospice. Dr. Talakkottur's practice is named TLC Medical, Aesthetics & Pain Management. The website for his practice shows that he provides Botox, IPL Photofacial, Juvederm/Dermal Fillers, Laser Hair Removal, Medical Marijuana, Medical Services, Medical Weight Loss, Medicare Doctor in Tampa, and Pain Management. Although advertised on his website, Dr. Talakkottur acknowledged he is not certified to provide medical marijuana treatment. Neither Dr. Talakkottur's practice website nor his practice YouTube page advertise hospice or end-of-life care services. Dr. Talakkottur never discussed the Handbook with anyone at AHCA. He did not receive any training from AHCA, CMS, HI, or NMR on how to perform the audit. Dr. Talakkottur was provided certain instructions from NMR on how to perform his reviews. The instructions state, "Please do not break up a certification period with partially approved/partially denied dates (i.e. if certification period is 01/01/2015 through 02/01/2015, and any dates within that period are deemed medically necessary, please approve the entire certification period)." Dr. Talakkottur acknowledged, however, that he did not follow this instruction. Dr. Talakkottur's testimony regarding the many patients he reviewed clarifies that he applied the six bullet points from the Handbook to his reviews of both certification and recertification decisions. However, the six bullet points are prefaced with a paragraph beginning: "Documentation to support the terminal prognosis must accompany the initial certification of terminal illness." In other words, the six bullet points are not applicable to recertification decisions. A patient must still have a prognosis of less than six months to be recertified, but the six bullet points no longer represent the appropriate factors. In fact, the Handbook clarifies that "[f]or subsequent election periods, written certification from the hospice medical director or physician member of the interdisciplinary group is required." In light of this clear distinction, deference to the clinical judgment of the hospice physicians becomes more significant for recertification periods. Dr. Talakkottur did not lend any credence to the "real-time" decisions of the hospice physicians. Instead, Dr. Talakkottur sought out ways to deny coverage and frequently based his decisions on bullet points that the patient was not required to satisfy to support eligibility. Dr. Talakkottur opined that he would not want to consider a patient's severity of comorbidities when prognosticating six months life expectancy or less. He often reviewed patients myopically, considering only the primary diagnosis. By way of explanation, he opined that in his professional opinion taking into account comorbidities was wrong because a condition such as an "ant bite" or a scratch is a comorbidity. In contrast, the other experts in this proceeding convincingly testified that the patient's whole condition should be evaluated in determining the prognosis of life expectancy of six months or less, including the presence and severity of comorbidities. Although Dr. Talakkottur was properly selected as a peer reviewer and qualified as an expert in internal medicine, his testimony was deemed less credible than that of the Vitas medical experts, Dr. Shega and Dr. Vermette. Dr. Eisner Dr. Eisner performed the peer review for 13 recipients, 12 of whom remain in dispute. Dr. Eisner's background is in internal medicine and gastroenterology. He held a board certification in internal medicine between 1993 and 2003. In 1995, Dr. Eisner was board-certified in gastroenterology, a board certification that he continues to maintain. At some point around 2003, the certification standards changed such that Dr. Eisner was no longer required to maintain his board certification in internal medicine in order to remain board- certified in gastroenterology. Since 1995, 100 percent of Dr. Eisner's practice has been focused on gastroenterology. Dr. Eisner routinely makes life expectancy prognostications for his patients. Further, Dr. Eisner also refers patients to hospice on a regular basis. In so doing, Dr. Eisner is called upon to make the type of prognosis determination similar to those at issue in this proceeding. Dr. Eisner does not treat patients for the following specific diseases: diabetes, hypertension, Chronic Obstructive Pulmonary Disease ("COPD"), HIV/AIDS, cerebral degeneration, cerebral vascular disease, cardiovascular disease, malignant neoplasm of the brain, heart disease, dementia, Alzheimer's, adult failure to thrive, or debility. He was only familiar with those diseases as comorbidities to a principal diagnosis related to a gastroenterological disease and does not treat those primary diseases. While cardiology, critical care, geriatric, infectious disease, medical oncology, and pulmonary disease are also subspecialties of internal medicine, Dr. Eisner has not done a fellowship in any subspecialty other than gastroenterology and does not hold himself out as an expert in any internal medicine subspecialty other than gastroenterology. Dr. Eisner did not recall receiving any instructions other than the Handbook but acknowledged he did not read the entire Handbook to perform his review. Dr. Eisner was not aware of what documentation must accompany the initial certification for a terminal disease for Medicaid hospice purposes or what documentation must accompany a subsequent certification for Medicaid hospice purposes. Contrary to the testimony of Dr. Talakkottur, Dr. Eisner acknowledged that the presence and severity of comorbidities should be considered when making a clinical determination of life expectancy of six months or more. Although Dr. Eisner was qualified both as a peer reviewer and an expert in this proceeding, his lack of any recent experience in a practice area other than gastroenterology diminished the weight given to his testimony concerning non- gastroenterology related illnesses and conditions. Dr. Komatz Dr. Komatz re-reviewed the records of one recipient that remains in dispute. Dr. Komatz holds an active Florida medical license and is board-certified in pediatrics and hospice and palliative medicine. She has been board-certified in hospice and palliative medicine since 2010. As part of her practice, Dr. Komatz currently cares for hospice patients, refers patients to hospice, and certifies patients for hospice care. According to Dr. Komatz, when determining the eligibility of a patient for hospice, a practitioner must look at the patient's overall level of function, medications, and needs regarding such things as the use of oxygen and equipment to assist with daily living. The determination is then made taking into account these and other factors regarding the patient's current state. In her professional opinion, it is not uncommon to see a patient who has a prognosis of six months or less actually live for longer than six months. Significantly, Dr. Komatz opined as an expert for AHCA that it is important for a physician to be board-certified in hospice and palliative care in order to be competent to review a hospice record because the hospice training teaches the practitioner more about disease trajectory, the interdisciplinary team and how that works in conjunction with the patient. It also provides experience as to how hospice operates in general. In addition, she noted that the person best able to determine hospice eligibility is someone who has been trained in hospice care and/or practices in that field on a regular basis. Dr. Komatz acknowledged that it is possible that two physicians could review the same medical records and reach different conclusions about the hospice eligibility of a patient. When reviewing the initial certification requirements, Dr. Komatz stated that most hospice beneficiaries forego further laboratory or radiologic studies. She also opined that the condition of hospice patients can plateau or improve due to the hospice care being received. Likewise, it would not be fair to look for a progression of functional decline in a patient if the patient was already at the lowest functional level. She stated that "specific documentation that indicates the recipient has entered an end-stage of a chronic disease" is vague and is merely a summary of the other specific initial certification requirements. Consequently, most of the six bullet points are rarely applicable. Dr. Komatz stated that to be eligible for hospice services, a patient need not meet all the initial certification six bullet points, but instead it is a "totality of circumstances" standard based on the medical record of the patient. Dr. Komatz worked as a subcontractor for NMR. She only communicated with NMR personnel regarding the audit. She had no contact with HI or AHCA. Dr. Komatz was provided the NMR instruction sheet, which instructs reviewers not to break up certification periods to perform her review. Dr. Komatz was qualified both as a peer reviewer and an expert in this case. Due to her regular and direct experience in hospice and palliative care, her testimony, particularly as to prognostication of life expectancy and the practice of hospice and palliative care generally, was given great weight. Vitas' Experts Dr. Shega Dr. Shega was accepted as an expert in hospice and palliative care and geriatric medicine. He is the National Medical Director for Vitas. In that role, he oversees the four regional directors, as well as the medical directors that report to them, and also oversees physician services. Dr. Shega testified regarding the disputed recipients in the Melbourne and Boynton Beach programs. Dr. Shega attended Northwestern University Medical School, performed his residency and internship at the University of Pittsburgh, and performed a two-year academic fellowship in geriatric medicine at the University of Chicago. He is board- certified in geriatrics and hospice and palliative medicine. He is licensed to practice medicine in Florida and Illinois and actively treats hospice patients roughly six to eight weeks per year. Dr. Shega is currently an associate professor of medicine at the University of Central Florida. Prior to that, he has held positions as an associate professor of medicine at the University of Chicago, an assistant professor of medicine at Northwestern, an assistant professor of medicine at the University of Chicago, and an instructor of medicine at the University of Chicago. While at Northwestern, he was the director of its hospice program for several years and also worked in a hospice as a team physician for the University of Chicago. Dr. Shega was part of the University of Chicago leadership committee in geriatrics and palliative medicine where he helped to oversee its clinical operations. He has also served on numerous geriatric and hospice-related committees. Dr. Shega is a member of the American Geriatric Society and the American Academy of Hospice and Palliative Medicine, and through being an associate editor for the "Pain and Aging" section of Pain Medicine, has a membership to the American Pain Society. He currently performs one to two teaching presentations a week across the country and has published over 40 peer-reviewed articles on topics related to hospice and palliative care. Dr. Shega was recently the co-managing editor of a nine-book series that discusses the background of hospice and palliative care, pain management, non-pain symptoms, psychological and social symptoms, pediatric care, and chronic illnesses and end- of-life illnesses, congenital hyperinsulinism ("CHI"), COPD, dementia, renal disease, and neurologic disorders. Dr. Shega was qualified as an expert in this case. Due to his regular and direct experience in hospice and palliative care, his testimony, particularly as to prognostication of life expectancy, and the practice of hospice and palliative care generally, was given great weight. However, the credibility given to Dr. Shega's testimony was tempered by the fact that he is directly employed by Vitas and was involved in overseeing or facilitating Vitas' response to the DARs, wherein Vitas contested every finding and sought reimbursement for every alleged overpayment. Dr. Vermette Dr. Vermette was accepted as an expert in hospice and palliative care, and family medicine. During the final hearing, he testified regarding the disputed recipients in the Dade program. Dr. Vermette is the Vitas Medical Director for the Claims Review Group. In that capacity, his duties are to review charts and perform support and training of other medical directors and physicians throughout the country in how to review charts and documentation. Dr. Vermette attended medical school at the University of Texas, Southwestern Medical School in Dallas. He then attended a three-year residency program in family medicine at the University of Texas Health Science Center in Houston followed by service in the military as a medical doctor, achieving the rank of Major. Dr. Vermette is licensed to practice medicine in a number of states, including Florida. He is board-certified in family medicine and hospice and palliative medicine. He is also certified as a Hospice Medical Director, which is designed to recognize expertise in hospice and palliative medicine. Dr. Vermette is certified as a registered medical auditor. Dr. Vermette has held faculty positions as a clinical instructor at the University of Texas Health Science Center, an associate professor of medicine at the University of Nebraska, a clinical preceptor for Texas A&M University and the University of North Texas, and currently serves as a volunteer faculty member at the Drexel School of Medicine and a voluntary clinical instructor at the Mercy Health System in Philadelphia. Dr. Vermette currently has staff privileges to provide hospice and palliative care medicine at Mercy Fitzgerald Hospital, Mercy Hospital, and Methodist Hospital in Philadelphia. In 1998, Dr. Vermette began referring patients to hospice and following them as their attending physician. In 2009, Dr. Vermette began working part-time for Vitas and routinely followed patients in the inpatient units ("IPUs") in Fort Worth. He would spend two out of every four weeks rounding and seeing hospice patients in the IPU. He then began doing some of the call activities, some home team visits, and participating in interdisciplinary care team meetings. He moved to Philadelphia in 2012 and continued treating Vitas hospice patients. At that time, he also began performing chart reviews for Vitas. Dr. Vermette sought licensure to practice in Florida shortly after Vitas became aware of this audit and that his pursuit of licensure in Florida was intended to facilitate his provision of expert witness services in this case. Dr. Vermette admitted that, even though he is licensed in Florida, he has never treated nor evaluated a single patient in Florida. In fact, the first time that Dr. Vermette read the Handbook was as part of his preparation to testify in this case. Dr. Vermette was qualified as an expert in this case. However, like the testimony of Dr. Shega, the credibility given to Dr. Vermette's testimony was tempered by the fact that he is directly employed by Vitas and was involved in overseeing or facilitating Vitas' response to the DARs, wherein Vitas contested every finding and sought reimbursement for every alleged overpayment. SPECIFIC CLAIMS FOR RECIPIENTS AT ISSUE Patient 2, D.A.2/ Melbourne Recipients Patient D.A. was a 48-year-old female, admitted to hospice on 07/15/09, with a terminal diagnosis of end-stage HIV/AIDS. The claim periods at issue are 09/01/09 to 09/12/09 and 02/15/10 to 05/31/10. D.A. was evaluated face-to-face by Dr. Peterson, the Associate Medical Director for Vitas, on 07/14/09, the day before her admission. Based on his clinical assessment, he determined the patient was hospice appropriate because she had HIV/AIDS, debility, and failure to thrive, with significant recent weight loss, and dysphagia, secondary to esophageal candidiasis.3/ D.A. was admitted to hospice with two active infections, profound weight loss over the previous two- to three-month period (per her self-reporting), peripheral neuropathy, lethargy, and fatigue; she spent most of her time in bed. She had discontinued her antiretroviral HIV-targeted treatment. She was noted to have a BMI of 18 at the time, which is considered severe malnutrition and which negatively impacted her prognosis. On admission, D.A. reported 10 of 10 pain in both legs from her HIV-related peripheral neuropathy. She was described as thin, cachectic (physical wasting with loss of weight and muscle mass due to disease), and had difficulty ambulating. D.A. was also noted to have a medical history of syncope (fainting), urinary tract infections ("UTIs"), and fractures. D.A. was started on medications for the infections, Mycelex for thrush, and Bactrim double-strength for her lung infection. D.A.'s blood work was done on 07/16/09, which showed the patient had a CD4 count of 89. Dr. Shega testified that while her CD4 count was above 25, given D.A.'s clinical status, hospice care was appropriate because the patient was more than likely at end-stage HIV/AIDS. After her July admission, D.A. started gaining weight with the support of the Vitas interdisciplinary team. She had no recurrent refractory infection and the status of her fractures improved as well. D.A.'s clinical status improved such that at the end of the first 90-day period, she no longer could be evaluated with a prognosis of six months or less, and was discharged on 09/12/09. D.A. was readmitted to hospice on 02/15/10 with a diagnosis of end-stage HIV/ADIS. At that time, D.A. was lethargic, weak, had a flat affect and responded with one-word answers. She required assistance with bathing and ambulating, and had a PPS score of 50 percent.4/ On 02/26/10, D.A. was noted to have some secretions and dyspnea (shortness of breath) with exertion. She was believed to have a recurrence of thrush and was started on Mycelex troches. On a 03/02/10 physician visit, the patient was noted to have difficulty swallowing, decreased ability to ambulate, was slightly confused, and displayed white patches on her oral pharynx, suggestive of candidiasis. A subsequent physician evaluation on 03/19/10 noted D.A. was suffering from a severe sore throat, weighed 96 pounds, and had a poor appetite, low blood pressure, and ongoing significant loss of muscle mass. On 05/17/10, D.A. was noted to have a temperature of 99.7, shortness of breath, thrush, and was placed on medication to help with her discomfort. On 05/31/10, a nurse saw D.A. and noted her weight had dropped to 94 pounds, her PPS declined to 40 percent. A hospital bed was ordered because the patient was spending 90 percent of the time in bed, due to fatigue and weakness. Dr. Eisner testified that this patient was not Medicaid hospice eligible because her candidal esophagitis is a treatable condition, it was treated, and her PPS score improved and she gained weight. Further, Dr. Eisner pointed out some likely inaccuracies in the recorded weights of D.A. However, Dr. Eisner provided an opinion regarding this patient outside his expertise as shown by his inability to provide any specific indicators with regard to prognosticating if an HIV/AIDS patient had six months or less to live. AHCA has not met its burden by the greater weight of the evidence that D.A. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 3, D.G. Patient D.G. was a 48-year-old female who was admitted to hospice with a terminal diagnosis of debility unspecified. Debility is a condition similar to "failure to thrive," which usually denotes a patient with poor conditioning due to multiple medical problems. The dates at issue are 09/30/09 to 10/20/09 and 11/12/09 to 12/25/09. D.G. was hospitalized on three occasions within several months of her initial hospice admission. At the second hospital admission on 09/15/09, she experienced respiratory failure requiring intubation and a tracheostomy and was placed on a ventilator, secondary to influenza and pneumonia. She experienced a myocardial infarction (heart attack or "MI"), acute renal failure requiring dialysis, and had multiple infections. She required a percutaneous endoscopic gastrostomy ("PEG") tube for feeding and a dialysis catheter. D.G. was placed in a skilled nursing facility upon the second hospital discharge, but soon signed out against medical advice and refused further dialysis. On 09/23/09, she was readmitted to the hospital with bacteremia, secondary to her dialysis catheter being infected. In addition, she had a UTI and a skin infection on her abdomen. While hospitalized, D.G. displayed an extremely high potassium level, which could trigger ventricular arrhythmia (irregular heartbeat). Her hospital physician deemed her to be hospice appropriate and referred her to hospice. Upon initial evaluation, the admitting nurse was unsure how to most appropriately list D.G.'s terminal diagnosis, as her multiple comorbidities included a left leg amputation above the knee due to severe peripheral vascular disease; ongoing dry gangrene on her right leg and foot; coronary artery disease resulting in a recent heart attack; renal failure requiring dialysis; COPD with recent respiratory failure from pneumonia; and Crohn's disease, requiring multiple surgeries. The terminal diagnosis of debility unspecified was deemed the most appropriate. When admitted to hospice on 09/30/09, Patient D.G. was very ill and in substantial pain, requiring increased pain medication. Shortly after admission, D.G. developed a change in level of consciousness. Patient D.G. suffered a seizure on 10/20/09. Her family revoked hospice care, and D.G. was transferred back to the hospital for more aggressive treatment. On 11/10/09, D.G. again presented to the hospital emergency room ("ER"), this time with abdominal pain and right lower extremity pain, confusion, and a low albumin of 3.0. D.G. was supposed to follow up with hospice, but did not do so. She was found to have a PPS of 40 percent, was disoriented, and was at risk of aspiration. She also had an ongoing ulcer on her right leg from the peripheral vascular disease with gangrene. D.G. returned to the ER the following day, 11/11/09, and at that time, was admitted to the hospital. Upon hospital admission, D.G. had a PPS of 30 percent and a BMI of 23. She was disoriented, lethargic, had shortness of breath at rest or minimal exertion, and had lower extremity edema on the right side with a foot ulcer. She was now on oxygen, two to three liters. On 11/12/09, D.G. was transferred from the hospital to the Vitas IPU for symptom management of uncontrolled pain, agitation, anxiety, and wound care. D.G. was diagnosed with debility and failure to thrive due to the multitude of medical conditions noted above. During the months prior to this second hospice admission, she had undergone serial physician assessments and laboratory and radiologic studies. She had also had multiple admissions to the hospital and ER. Over the course of the second hospice period, D.G. had a PPS of 40 percent, then a PPS score of less than 40 percent, and finally, a PPS score of 30 percent. Dr. Shega testified that a patient's PPS score of 30 or 40 percent is supportive of a prognosis of six months or less, if the illness runs its normal course. After a brief stay in the Vitas IPU, D.G. returned home for care. On 12/04/09, she was dependent in 5 of 6 ADLs. On 12/11/09, her dry gangrene converted to wet gangrene and additional medication was started. She became lethargic and was given antibiotics, but her condition worsened, and she was transferred back to the IPU with a 10 of 10 pain, and low-grade fever. D.G. met specific indicators of "rapid decline and disease progression" from the LCD for debility. She exhibited dependence in more than 3 of 6 ADLs, a PPS below 70 percent, recurrent infections, worsening pressure wounds, increased pain, increased respiratory symptoms, and changes in lucidity. At final hearing, Dr. Eisner testified that D.G. "improved to the point that hospice was revoked on 12/25/09." Dr. Eisner was incorrect, however, because the record reflects D.G. was placed back in hospice IPU on 12/24/09, as she continued to deteriorate, refused evaluation by staff and threatened to call the police if wound care was attempted. The following day, D.G. revoked hospice a second time and went back to the hospital to seek aggressive treatment. Dr. Eisner concluded that D.G. did not meet the standard of six or less months to live; rather, D.G. suffered from a chronic condition, Crohn's Disease. However, this does not account for D.G.'s multitude of significant comorbidities. AHCA has not met its burden by the greater weight of the evidence that D.G. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 6, J.R. Patient J.R. was a 58-year-old male with a terminal diagnosis of end-stage heart failure. The claim period at issue is only one week, 01/24/11 to 01/31/11. During the period at issue, J.R. suffered NYHA Class IV heart failure. Class IV is the worst classification and supportive of hospice appropriateness. J.R. had a PPS of 50 percent and had active symptoms that supported a life expectancy of six months or less if the illness ran its normal course. Dr. Eisner credibly testified that by 01/24/11, J.R. had improved to a point that his life expectancy was greater than six months. J.R.'s disease was no longer progressing to the point of impairment, and his functional capacity had improved. However, AHCA approved benefits for Patient J.R. for the time frame 04/19/10 through 01/23/11. The one-week time frame at issue fell within the last 60-day benefit period approved by AHCA, which began on 12/15/10. According to the instruction provided to the reviewers, this week must be approved. AHCA has not met its burden by the greater weight of the evidence that J.R. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 7, R.A. Patient R.A. was a 59-year-old male with a terminal diagnosis of COPD who was admitted to Respondent's care on 03/21/11. The dates at issue are less than two months, from 03/21/11 to 05/01/11 and 05/04/11 to 05/16/11. R.A. had a medical history of non-small cell lung cancer, which had been treated with chemotherapy and radiation. He also had a history of hypertension, depression, peripheral vascular disease, arthritis, chronic back pain, gastroesophageal reflux, and seizures. The precipitating event leading to his hospice admission was a hospitalization for pneumonia. At the time of discharge from the hospital, the original plan was for R.A. to be discharged to a skilled nursing facility. The hospital had trouble finding a skilled nursing facility willing to take the recipient because of his social problems, so it appears the hospice placement was a placement of convenience as indicated in a physician's visit note dated 03/28/11, where it was noted, "Case manager is involved in the case to help him out and for possible placement. We will continue with the present medications at this point." In fact, R.A. told Vitas' staff that he would like to have an aid to help him with ADLs and his medications until he gets better, and Vitas' staff suggested R.A. should be referred for home care services. R.A. lived alone. Instead, R.A. entered hospice care. The initial certification documentation incorrectly indicated that R.A. had end-stage lung cancer; however, he had previously been diagnosed with lung cancer, which was in remission at the time of his hospice admission. R.A. revoked hospice care to return to the hospital for aggressive treatment of pneumonia. The certification documentation for R.A.'s second admission again incorrectly listed R.A. as having an end-stage diagnosis of lung cancer, despite the recipient telling Respondent that he was negative for cancer during his first admission. Respondent's certifying physician stated there was a new finding of mediastinal lymphadenopathy, a swelling of the lymph glands in the chest areas, which could be consistent with a reoccurrence of his primary process. Dr. Talakkottur, however, explained that R.A.'s lymph glands could have been enlarged for a number of reasons, such as if he had a cold, a blockage of lymph fluid, or pneumonia. Because R.A. had been suffering from bouts with pneumonia, enlarged lymph glands was not conclusive evidence of a reoccurrence of lung cancer. The initial nursing assessment prepared 05/04/11, notes that R.A. had been diagnosed during his last hospitalization with pneumonia and was complaining of cough and congestion. A nurse noted in her assessment that the recipient continued to express his desire to live alone, but she noted he may need a higher level of care. Dr. Talakkottur credibly testified that this recipient did not suffer from a terminal illness; rather, R.A. suffered from a chronic disease-—COPD. He had been diagnosed with COPD five years prior to his first hospice admission. R.A. was sick, but he was not likely to expire within the next six months. He just needed assistance with minor care, housekeeping, and occasionally with ADLs. He was not hospice appropriate and could have been served in a home health setting. The medical records contained in this recipient's file do not support a finding that the Medicaid hospice eligibility standard was met. Based upon the greater weight of evidence in this case, it is determined that this recipient was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $20,467.42.5/ Patient 8, T.F.C. Patient T.F.C. was a 57-year-old female with a terminal diagnosis of malignant neoplasm of the corpus uteri. The dates at issue are 06/16/11 to 02/21/12. T.F.C. was diagnosed on 04/25/11 with high-grade serous adenocarcinoma by her treating oncologist. Her uterus and one of her fallopian tubes were removed due to cancer. After surgery, she was seen as an oncology outpatient during May 2011. On 06/12/11, T.F.C. presented to the ER with low back pain, which was not relieved with morphine. Her computed tomography ("CT") scan revealed severe left-side hydronephrosis, hydroureter, left pelvis and a spiculated soft tissue, whose density measured 3 x 2 centimeters. During the dates at issue, her PPS ranged from 40 to 60 percent, although she required increased pain medication and experienced three infections. She had a series of physician assessments and lab work, both while in the hospital and on outpatient visits. Dr. Shega testified that an oncologist from MD Anderson Cancer Center referred T.F.C. to hospice. There is, however, no file evidence to support this testimony, and it is difficult to understand how Dr. Shega knew this fact to be true. The only certification was that of the written certification prepared by Vitas' physician. Dr. Rebecca Moroose of MD Anderson Cancer Center of Orlando saw T.F.C. on 11/02/11. In her progress note, Dr. Moroose reflected upon the T.F.C's severe left hydronephrosis while hospitalized in June, which was believed to be associated with a mass "suspicious for recurrence." Dr. Moroose further reported that since being on hospice care, T.F.C. had excellent symptom control and that most of her pain was associated with her midline abdominal surgical scar and an associated mass found. Dr. Moroose planned to contact Vitas for clearance to obtain a CT imaging of the abdomen to reassess T.F.C.'s disease. On 11/07/11, a CT of her abdomen and pelvis with contrast, was performed and a comparison made to CT of June 2011. Two masses were discussed and compared to the earlier study. The seroma in the anterior abdominal wall of her vertical midline surgical incision was stable and felt not to represent a malignancy but rather a benign fluid collection. The second mass was much less conspicuous in the current study and represented a significant reduction in size compared to the previous study and was believed to possibly represent fibrotic tissue or residual disease. No clear evidence exists from the hospital records and/or MD Anderson Cancer Center that either mass is a definite recurrence of the disease. T.F.C.'s functional status remained static during her first admission. She was able to feed herself, her BMI was consistent with obesity, she could make her needs known, and when the nursing notes assessed her cognitive function, the recipient was consistently reported to be alert and oriented "times three." T.F.C. often reported her pain as zero, on a scale of zero to ten, and her PPS was between 40 and 60 percent. T.F.C. had no inpatient or continuous care stays while in hospice. T.F.C.'s need for increased pain medication appears to be related to issues she was having with her bladder, including kidney stones. She revoked hospice care on 02/21/12, to go to the hospital, to be treated for pain in her abdomen, which was related to kidney stones. Additionally, while in the hospital, she underwent a procedure to insert a stent to facilitate urination. Although T.F.C. had a history of bladder and UTIs, none of Vitas' recertifications or addenda to the recertifications report the recipient having either a bladder or UTI during the disputed period. Although T.F.C. suffered from a terminal illness, the medical records for this recipient do not support a diagnosis of six months or less if the disease runs its normal course. As Dr. Talakkottur testified, the medical records do not demonstrate a clinical progression of the terminal illness. During the period in dispute, T.F.C.'s condition overall remained static. Based upon the greater weight of evidence in this case, it is determined that this patient was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $36,221.03. Patient 9, A.J. Patient A.J. was a 74-year-old female with end-stage cerebral degeneration, with two recent hospitalizations prior to hospice admission. The dates at issue are 09/01/10 to 04/22/12. Upon admission to Vitas hospice, A.J. had a PPS of 30 percent and was dependent for 6 of 6 ADLs, with a FAST score of 7c. A.J. had an altered level of consciousness and was at high risk of aspiration. A.J. had a history of strokes and transient ischemic attacks ("TIA" or "mini-strokes"), with encephalomalacia in the left frontal and right thalamus, hypertension, coronary artery disease, increased lipids, dementia, psychosis with hallucinations, anemia, diabetes, chronic renal insufficiency, a history of gastrointestinal ("GI") bleed, and peripheral vascular disease. In terms of her functional state at initial certification, A.J. was bedbound, not fully capable of following commands, had sarcopenia (muscle wasting) in all four extremities, was very feeble, lethargic and oriented times zero, which meant she did not know who she was, where she was, or when it was. During the period at issue, A.J.'s PPS remained at 30 percent, she was dependent in 6 of 6 ADLs, her FAST score was always above 7, she was oriented to zero or one, and she was incontinent. A.J. had several infections during this time frame. A FAST score above 7 in a dementia patient is consistent with a terminal prognosis, according to the LCDs. Dr. Talakkottur testified that, in his opinion, A.J.'s condition was chronic, not end-stage. His opinion was based on his evaluation that A.J. did not decline during her stay in hospice. Dr. Shega, with ten years' experience as co-director of the Memory Disorders Clinic at the University of Chicago, strongly disagreed, opining that based on her medical history, including two recent hospitalizations, and the evaluation upon admission, A.J.'s dementia was end-stage. During her hospice stay, she continued to lose weight, had temporal wasting and muscle loss, began to experience contractures, and was sleeping more. Furthermore, citing the medical literature, Dr. Shega opined that A.J.'s health did decline in light of her three infections. Two weeks after her initial admission to hospice, A.J. was placed on continuous care due to nausea and vomiting, with no oral intake for two days. Later that same month, she was admitted to a hospital while remaining on hospice. A.J. met the disease specific criteria from the LCD for dementia and related disorders. As noted above, she had a FAST score of 7c, which indicates she was speaking six words or fewer, was 6 of 6 ADLs, and was incontinent. While A.J.'s time in hospice stay was certainly longer than anticipated, a review of her complete medical history presented a dementia patient with a prognosis of six months or less should the disease run its normal course, and she continued to decline. A.J. clearly met the criteria for admission to hospice for the dates at issue. AHCA has not met its burden by the greater weight of the evidence that A.J. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 10, M.A. Patient M.A. was a 56-year-old male with end-stage liver disease and end-stage COPD. The period in dispute is 10/10/10 to 04/30/11. M.A. had been hospitalized twice just prior to hospice admission, the first for 13 days beginning 08/03/10, with a second admission on 08/30/10. M.A. was hospitalized the second time with chest pain and dyspnea. M.A. remained in the hospital (almost six weeks) until referred to hospice by his hospital physician due to abdominal pain and ascites. Ascites, the accumulation of fluid in the peritoneal cavity, causing abdominal swelling, can occur as a result of liver failure. M.A.'s medical history included end-stage liver cirrhosis, chronic COPD, a history of GI bleed, esophageal varices, portal hypertension, alcohol abuse, diabetes, chronic renal insufficiency, anemia, coronary artery disease, and a left frontal cerebrovascular accident ("CVA" or stroke). In Dr. Talakkottur's opinion, Patient M.A. did not have end-stage liver disease because, in part, there was no report of blood in the stool or of vomiting blood. Although Dr. Talakkottur asserted ascites was not present in this patient, on cross-examination, he acknowledged ascites was noted in January 2011. In fact, M.A. was referred to hospice directly from an extended hospital stay for abdominal pain and ascites. Dr. Talakkottur also testified that M.A. had not been prescribed Lasix or Aldactone for ascites during his hospice stay. Dr. Shega, however, testified to the patient's substantial ascites, despite his being given a very high dose of diuretics, including Aldactone. Contrary to Dr. Talakkottur's testimony, the draft audit report acknowledges M.A. also had ascites on 12/29/10 and in March and April 2011. Dr. Shega opined that although M.A. did not specifically meet the LCDs for end-stage liver disease alone, the fact that he also had end- stage COPD, in combination with his substantial symptom burden, refractory ascites, and encephalopathy with forgetfulness, which worsened over the patient's stay, made the patient appropriate for hospice. M.A. exhibited shortness of breath at rest and with activity and was on 3.5L oxygen per nasal cannula. Over the course of the period at issue, M.A.'s dependency for ADLs generally trended higher, as did his level of pain, while his cognitive status worsened. The recertification signed on 03/24/11 reported cachexia and muscle wasting. While upon admission M.A. could walk a handful of steps by himself, by the end of the period, he was essentially bedbound. M.A.'s health clearly declined over the period at issue. Given his history of recent, lengthy hospitalizations, his numerous comorbidities with significant symptom burden, and his decline in functional status, M.A. clearly met the criteria for admission to hospice for the dates at issue. AHCA has not met its burden by the greater weight of the evidence that M.A. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 11, D.C. Patient D.C. was a 47-year-old female with a terminal diagnosis of adult failure to thrive. The three claim periods at issue are 12/21/10 to 02/10/11; 04/25/12 to 07/16/12; and 10/04/12 to 12/29/12. D.C. had a longstanding diagnosis of refractory Crohn's disease. At the time of her appropriateness evaluation in December 2010, she resided in a nursing home, which would have required a physician's order to agree that the patient was hospice appropriate. She had a PPS of 40 percent, was dependent in 2 of 6 ADLs, weighed 103 pounds, and suffered from alopecia (loss of hair). Her pain level was 7 of 10. Prior to admission to hospice, D.C. had been hospitalized twice in 2010, the first time in March for sepsis and endocarditis, and the second time on 07/30/10, for GI surgery, with complications of three fistulas, which placed her at high risk for infection. D.C.'s comorbidities included protein-calorie malnutrition, ongoing abdominal pain, anemia, reactive airway disease, neuropathy, peptic ulcer, a history of duodenal ulcer and GI bleed, ileostomy, depression, peripheral vascular disease, coronary artery disease, and cellulitis. The patient was very hesitant to eat, as food equaled pain. During the course of her first certification period, D.C.'s medical condition stabilized, and she was discharged on 02/10/11 due to an extended prognosis. Upon D.C.'s second hospice admission, her PPS was 40 percent, she was dependent on 5 of 6 ADLs, with a recent loss of weight and a BMI of 21.6. Her pain was recorded at 7 of 10 and she had developed a stage 2 sacral wound, in addition to two wounds on her abdomen. Her comorbidities remained the same as at the first admission, with the exception of a benign tumor above her heart, which was removed. During the course of her second certification period, Patient D.C.'s medical condition again stabilized and she was discharged on 07/16/12 due to an extended prognosis. Upon admission to hospice the third time, D.C.'s comorbidities remained the same. Her PPS score was 40 percent. In early December 2012, however, D.C. began to develop paranoia, was agitated and anxious, and required continuous care to have her antipsychotic medication titrated. On 12/15/12, D.C. fell and again was placed on continuous care for her paranoia and the fall. On 12/25/12, D.C. was involuntarily committed to the Halifax Hospital psychiatric unit. Her mother requested she be returned to the Halifax ER on 12/29/12 for a worsening altered mental state, at which time she was described as unresponsive. Her family revoked the hospice benefit, and D.C. was transferred to an inpatient hospice house in another program closer to the family's home. Dr. Talakkottur testified Crohn's Disease is a chronic disease and one could live for 20 to 30 years or more. Crohn's Disease is characterized by periods of dormancy or being well- controlled and periods of exacerbation. It should be noted, however, that at the time of the first admission, D.C. had already lived 39 years with the disease. Dr. Shega testified he believed that D.C. was hospice appropriate for each of the three periods in dispute due to her chronic condition, coupled with recent infections and weight loss. However, Dr. Shega admitted that it is common for a person suffering from Crohn's Disease to have weight fluctuations. Moreover, Dr. Shega admitted that many of the weight measurements in D.C.'s medical records were unreliable. D.C. met all applicable criteria for admission to hospice for the first period in dispute. However, as to the second and third periods in dispute, Dr. Talakkottur more credibly testified that D.C.'s medical records did not support an end-stage progression of any kind of disease; rather, she experienced exacerbations of her chronic illness, which she has had for the preceding 39 years prior to her hospice admission. Based upon the greater weight of evidence in this case, it is determined that this recipient was not eligible for Medicaid hospice services during the second and third periods in dispute and that AHCA is entitled to recover an overpayment in an amount to be determined. Patient 12, C.W. Patient C.W. was a 42-year-old male with a history of stroke in 2003 and a terminal diagnosis of end-stage cerebrovascular disease. The dates at issue are 02/17/10 to 01/05/11 and 01/31/11 to 05/23/11. In 2003, seven years prior to his hospice admission, C.W. experienced a stroke. Additionally, since 2006, C.W. had cardiomyopathy, which is a disease of the heart reflective of an ejection fraction ("EF") of 35 percent or less. Dr. Shega opined that although the stroke was in 2003, it "could have left him extremely debilitated." Furthermore, C.W. also suffered from HIV, heart failure, and had been recently hospitalized for the removal of skin lesions in his groin area prior to his first admission. C.W. was discharged from his first admission for extended prognosis. For the second admission, Dr. Shega testified that C.W. had experienced a urinary tract infection ("UTI") precipitating his readmission to hospice. Ultimately, C.W. was discharged for extended prognosis, and Dr. Shega stated C.W. was appropriate for discharge because although C.W. had a couple of acute conditions during this stay, his weight and functional status stabilized, he did not have another infection, and he did not show any other decline. Dr. Talakkottur credibly opined that C.W. experienced issues related to his stroke and cardiomyopathy for quite some time prior to his admission to hospice. Therefore, C.W. had not experienced any change in health to warrant admission to hospice. While C.W. suffered from HIV, Dr. Talakkottur testified his HIV viral load was undetectable, meaning the viruses in his bloodstream were very low. Furthermore, Dr. Talakkottur opined that C.W.'s comorbidity of HIV was of no concern because the recipient also continued to receive his highly active antiretroviral therapy. Dr. Talakkottur further opined with respect to C.W.'s second admission that a UTI is not an indicator of end-stage cerebrovascular disease. C.W. had a Foley catheter, and it is common for recipients with a Foley catheter to develop UTIs. The medical records contained in this patient's file do not support a finding that the Medicaid hospice eligibility standard was met. Based upon the greater weight of evidence in this case, it is determined that C.W. was not eligible for Medicaid hospice services during either period in dispute and that AHCA is entitled to recover an overpayment of $61,721.28. Patient 13, J.M. Patient J.M. was a 59-year-old male with a longstanding history of medical noncompliance with treatment plans and substance abuse, who was admitted with a terminal diagnosis of end-stage COPD after six ER visits or hospitalizations in just over six months. The dates at issue are 03/29/12 to 06/15/12 and 08/31/12 to 12/31/12. J.M.'s PPS upon admission was 50 percent, and he had shortness of breath at rest and exertion. His comorbidities included known fatty liver with history of ascites, CVA times two, UTIs, diabetes type 2, gastritis, hypertension, gastroesophageal reflux disease, heart failure with diastolic dysfunction in left ventricular with amyloidosis, myocardial infarction ("MI" or "heart attack") times two, pulmonary embolism, obesity, and bipolar disorder. J.M. suffered from COPD for many years preceding his hospice admission. He used oxygen on an as-needed basis, preceding and during his hospice stay. J.M. was also a polysubstance abuser. Dr. Talakkottur opined that J.M.'s issues were not the result of a progression of his terminal illness; rather, his decline was associated with his substance abuse. When J.M. was not abusing drugs and was compliant with his medication for his COPD, he had a good quality of life. Conversely, when he abused drugs and was noncompliant with his medication for COPD, he seemed to decline more. Dr. Shega testified that J.M.'s six ER visits/hospitalizations factored into his opinion that the recipient's COPD was end-stage. The nurse completing the Appropriateness Evaluation form noted under hospitalizations that the recipient visits a hospital at least monthly. The recipient tested positive for cocaine during those hospitalizations. The hospital attributed J.M.'s abdominal pain to cocaine use during the latter visit. Dr. Shega testified it was known that J.M. was a controlled substance abuser, particularly cocaine. Although J.M. suffered from a chronic illness, the medical records do not support a diagnosis of six months or less if the disease ran its normal course. Instead, as Dr. Talakkottur testified, the medical records demonstrate J.M. had an issue with medication compliance. For instance, nurses routinely had to remind J.M. to take his nebulizer treatment. However, when he took his medication, he appeared to have no respiratory distress and the intervention was effective. The medical records contained in J.M.'s file do not support a finding that the Medicaid hospice eligibility standard was met. Based upon the greater weight of evidence in this case, it is determined that J.M. was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $31,736.82. Patient 16, M.W. Patient M.W. was a 61-year-old female diagnosed with multiple sclerosis ("MS"). The claim periods at issue are 08/26/11 to 08/14/12 and 12/16/12 to 12/31/12. The patient's comorbidities included multiple basal cancer cell removals, arthritis, a history of gallstones, ileus, depression, osteoporosis, COPD, and glaucoma. MS is a condition that affects the neurological system. There are different kinds of MS, yet the most common type is called relapsing-remitting MS, which affects 80 percent of MS recipients. A patient with relapsing-remitting MS is similar to patients with other chronic illnesses in that a patient will have events or flare-ups that may occur roughly every 12 to 18 months or more. MS affects the quality of life more than it affects the quantity of life. M.W. suffered from MS since she was 34 years old, so she had dealt with the effects of MS for 27 years. Dr. Shega opined that this recipient was hospice eligible because of the recent decline in her functional status and nutritional decline. Dr. Shega stated his recollection was this patient could ambulate prior to her hospice admission. However, he later admitted M.W. was unable to walk for the past three to four years and had used a wheelchair for the past five to six years. Furthermore, on cross-examination, Dr. Shega admitted that the BMI for M.W. was miscalculated, and her BMI was in the normal range (22.8). In contrast, Dr. Talakkottur testified this patient was merely experiencing flare-ups of her chronic condition. Dr. Talakkottur opined that patients with terminal MS experience deteriorating respiratory function, which is evidence of the final decline. Dr. Talakkottur also noted that Respondent's month-to-month reports demonstrated unexplained discrepancies in M.W.'s reported scores for PPS, MMA, and ADLs. Furthermore, the medical records did not demonstrate M.W. had any deterioration in her respiratory function or any other terminal progression. If anything, as Dr. Talakkottur testified, the medical records show improvement for dependence with ADLs and her PPS score remained static. The medical records contained in this recipient's file do not support a finding that the Medicaid hospice eligibility standard was met. Based upon the greater weight of evidence in this case, it is determined that this recipient was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $54,133.32. Patient 17, T.D. Patient T.D. was a 45-year-old female with a terminal diagnosis of end-stage heart disease. The claim period at issue is 04/14/11 to 12/23/11. The patient was diagnosed with NYHA Class IV heart failure as evidenced by shortness of breath at rest, worsening with exertion, and three and a half liters of oxygen via nasal cannula. Her PPS was 50 percent. She requested hospice and was referred to hospice by her primary physician because she required increased support and only wanted palliative treatments. Prior to her admission to hospice, T.D. had multiple encounters requiring physician management and an ER visit on 02/02/11 for a respiratory infection. She also suffered from ischemic cardiomyopathy, had a defibrillator placed in 2008, and suffered from diabetes requiring an insulin pump, peripheral neuropathy, COPD, sleep apnea, arthritis, spinal stenosis, gastroesophageal reflux disease, and history of TIAs. She was on 13 different medications. Dr. Shega opined that the NYHA classification is the predictor most tightly correlated with patient mortality. In this case, while T.D.'s EF changed, her symptom burden did not change. Dr. Talakkottur acknowledged that throughout the claim period at issue, the patient was a Class IV. Dr. Talakkottur testified that in his opinion hospice eligibility was not established, in part because the patient had no jugular venous distention ("JVD") on physical exam. Dr. Shega opined that in hospice care, forced expiratory volume in one second ("FEV1s") are done to characterize the patient's underlying pulmonary status. While outside hospice total volume tests are frequently done to establish a diagnosis, in this case diagnosis had been established and Vitas was prognosticating, not diagnosing. Between 04/29/11 and 11/08/11, T.D. had an abdominal infection requiring antibiotics; she had an episode of thrush; she had a titration of her pain medication due to discomfort; she had another episode of cellulitis in the abdomen; her PPS dropped to 40 percent and her ADLs were 4 of 6; she experienced a respiratory infection requiring antibiotics; she required antibiotics for a vaginal boil; she had an abdominal wound; methadone was prescribed for increased pain; methadone dosage was increased due to swelling; and methadone was again increased because of worsening pain. T.D. was discharged on 12/23/11 for extended prognosis. Dr. Shega testified that while he understood why that call was made, he offered the opinion that the patient still had a prognosis of six months or less. In addition to the reasons set forth above, during the course of the admission period, her PPS went from 50 to 40 percent, back up to 50 percent and, then declined again to 40 percent. She also experienced poor intake and chest pains during this time. T.D. was evaluated as a NYHA Class IV throughout her hospice admission. She had had multiple physician encounters in the months prior to her admission and was referred to hospice by her primary care physician. She continued to have multiple episodes of infection and wounds while in hospice care. For these reasons, this patient met the hospice admission guidelines for the claim period at issue. AHCA has not met its burden by the greater weight of the evidence that T.D. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 18, R.J. Patient R.J. was a 52-year-old male with terminal COPD. The claim dates at issue are 11/18/10 to 01/11/11. Immediately prior to admission to hospice, R.J. had been hospitalized for 12 days (from 11/06/10 to 11/18/10) for COPD exacerbation. He had hypercapnic, hypoxic respiratory failure and was unable to breathe on his own. He was on oxygen and placed on a BiPAP. Upon hospice admission, in addition to having disabling dyspnea at rest, R.J. was poorly responsive to bronchodilators and had an enlarged right atrium. His PPS was 40 percent, a BMI of 20, a very low weight of 114, and was dependent 4 of 6 ADLs. The patient was referred to hospice while in the hospital by his treating physician. His comorbidities included HIV, history of substance and alcohol abuse, arthritis, thrush, and bladder infections. Upon admission, R.J. was prescribed treatment of three liters of oxygen via cannula, continuous. A nebulizer treatment was used, using aerosolized medication to penetrate into the pulmonary system. On 12/03/10, the patient experienced a respiratory rate of 20, had an 8 of 10 abdominal pain, and was noted to be confused and agitated. On 12/09/10, R.J. had a pulmonary function test with an FEV1 of 0.42, which was 18 percent of predicted. An FEV1 less than 30 percent of predicted is associated with a severe airflow obstruction, supportive of a prognosis of six months or less. R.J. continued to have confusion and agitation through 12/14/10, when he was oriented times two. While it was true that R.J. did not suffer a COPD exacerbation or infection during the months at issue, Dr. Shega testified he had declined in respiratory status since admission, noting a second, severely reduced FEV1 to 10 percent. On 12/31/10, R.J. had elevated blood pressure, and continued to exhibit confusion, agitation and cognitive loss. He also continued to have dyspnea with low activity tolerance. R.J. exhibited specific indicators of "progression of end stage pulmonary disease" and "severe chronic lung disease" from the LCD for pulmonary disease. As noted above, he had hospitalizations due to his COPD immediately prior to admission to hospice and an FEV1 of less than 30 percent. His 12-day hospitalization, his poor nutritional status, his comorbidities and decline in respiratory status during the eight weeks at issue all support a finding that Patient R.J. was hospice appropriate during the claim period at issue. AHCA has not met its burden by the greater weight of the evidence that R.J. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 21, W.C. Patient W.C. was a 55-year-old female with congestive heart failure. She had ischemic cardiomyopathy, suggesting poor blood flow in her coronary arteries, impacting how well it pumps. The claim periods at issue are 10/06/11 to 10/25/11 and 11/30/11 to 11/27/12. W.C. was hospitalized for a cardiac catheterization on 08/29/11, and then hospitalized in September 2011 and again on 10/02/11 with heart failure exacerbation, the latter hospital stay being immediately prior to her first admission to hospice. She presented with chest pain and shortness of breath and had a low EF of 20 percent. W.C. also had an extremely low albumin of 2.2 indicating malnutrition, which was a factor in her refractory and recurrent edema. Both the hospitalist and cardiologist who treated W.C. on her most recent hospitalization referred her for hospice care. W.C. previously had cardiac bypass surgery, a history of chronic renal insufficiency, anemia, hypertension, bipolar disorder and was an insulin dependent diabetic. She had a defibrillator implanted twice, but it had to be removed each time due to infection. She also suffered from chronic lung disease. Likely due to her underlying mental health issues, W.C. had a longstanding history of noncompliance with her medication regimen. Despite W.C.'s multiple clinical issues, on 10/11/11 W.C.'s history and physical raised a question whether she was too functional for hospice services. Given her recent clinical history, W.C. was monitored for two weeks to evaluate and her case was forwarded to medical review to determine hospice appropriateness. On 10/16/11, W.C. complained of chest pain, her BMI had declined from 27.2 to 22.5, and she was experiencing edema. W.C. also experienced paroxysmal nocturnal dyspnea, and required three pillows at night for comfort and dyspnea. On 10/25/11, W.C. revoked the hospice benefit to return to the hospital for aggressive treatment for shortness of breath. During that stay she experienced a MI (heart attack), and ongoing ischemic cardiomyopathy with a low EF of 20 percent. W.C. was readmitted to hospice on 11/30/11, following discharge after a five-day hospitalization. Dr. Shega admitted this recipient was a challenge to diagnose for disease progression because she had good days and bad days, and that one of Respondent's physicians, who treated her struggled with whether she was chronic or end-stage. Dr. Talakkottur opined this patient did not appear to be end-stage. W.C. had a normal volume status with sporadic periods of edema (swelling in the legs). W.C. had no heart arrhythmia, no tachycardia (fast heart rate), no hypotension (low blood pressure), and no hemodynamic instability (unstable blood pressure to support normal organ function). If anything, the problems experienced by W.C. were the result of her noncompliance with her medications and not that her disease had reached a terminal state. In fact, when Vitas discharged this patient, they noted that she was noncompliant with her medications. W.C. was independent for ADLs, lived alone, drove herself, and was still active in the community. The medical records contained in W.C.'s file support a finding that the Medicaid hospice eligibility standard was met for the first period but not the second. Based upon the greater weight of evidence in this case, it is determined that this recipient was not eligible for Medicaid hospice services during the second period and that AHCA is entitled to recover an overpayment in an amount to be determined. Patient 22, B.A. Patient B.A. was a 51-year-old female diagnosed with end-stage cerebrovascular disease. The claim periods at issue are 05/01/12 to 09/19/12 and 09/24/12 to 12/31/12. Prior to her admission to hospice, B.A. had two recent hospitalizations due to complications from a stroke suffered in December 2011. A PEG was placed during the second hospitalization on 04/21/12, for dehydration and fever. Over a period of five months, B.A.'s weight declined from 180 to 123 pounds, with a BMI of 20.5. Upon initial admission to hospice, B.A. was thin and frail, lethargic, short of breath with minimal exertion, incontinent, and had a stage one ulcer on her coccyx. B.A. was nonverbal, dependent in 6 of 6 ADLs and had a PPS score of 30. Her comorbidities were severe dementia, diabetes, carotid artery disease, and hypertension. Patient B.A. suffered a change in consciousness (likely seizures) and revoked hospice on 09/19/12 when she was admitted to a hospital. An MRI was conducted in the hospital, which showed diffused cerebral atrophic changes and evidence of decreased blood flow/oxygen to the brain. B.A. was discharged from the hospital and readmitted to hospice on 09/24/12, at which time she was unresponsive, with a PPS of 10, a documented weight of 110, and a FAST score of 7f. Just after her second hospice admission, she had a temperature of 100 on 09/25/12. On 10/10/12, she developed a stage two sacral ulcer. During this second admission period, B.A.'s weight continued to decline and she showed signs of muscle wasting. Dr. Talakkottur's re-review and deposition testimony was that Patient B.A.'s "records did not support progression of end-stage pulmonary disease, as evidenced by increasing visits to the emergency department for pulmonary infections or respiratory failure." As pointed out by Dr. Shega, however, Patient B.A. was never admitted for end-stage pulmonary or respiratory disease, but rather for cerebrovascular disease and cerebral degeneration. Dr. Talakkottur did not offer final hearing testimony regarding Patient B.A. Instead, AHCA offered his deposition testimony. In his deposition, he acknowledged he had not made note of B.A.'s significant weight loss. B.A. met the disease specific criteria from the LCD for dementia and related disorders. As noted above, she had a FAST score of 7c or less, which indicates she was speaking six words or fewer, was dependent in 6 of 6 ADLs, and was incontinent. For the audit periods in question, it is undeniable that Patient B.A.'s prognosis of six months or less was correct, and she was Medicaid hospice eligible during all of the dates at issue. AHCA has not met its burden by the greater weight of the evidence that B.A. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment for either period. Patient 23, E.G.D. Patient E.G.D. was a 70-year-old female diagnosed with adult failure to thrive. The patient was initially admitted to hospice on 01/06/10 and deemed eligible for hospice through 03/23/10. The dates at issue are 03/24/10 to 4/16/10 and 5/20/10 to 12/21/10. On 03/23/10, E.G.D. was noted to weigh 95 pounds, with a BMI of 19.9. She also experienced dysphagia and increased agitation. She had edema on the lower extremities, a PPS of 40 percent, and her ADLs were 11 of 12.6/ Patient E.G.D. had been hospitalized during the prior year with a MI in June 2009. Her comorbidities also included diabetes mellitus, hypertension, advanced Alzheimer's disease, coronary artery disease, ischemic cardiomyopathy, a pacemaker, and recurrent falls. On 04/02/10, while the patient's weight had increased to 95 pounds while on hospice care, her PPS was 40 percent and her FAST score remained at 7b. E.G.D. had impaired communication, was confused, had edema in her periphery, and had an acute UTI requiring antibiotics. Although the patient's weight had increased, her BMI was still under 20. E.G.D. was discharged on 04/16/10 for extended prognosis. She was readmitted to hospice on 05/20/10, after having been hospitalized for an acute heart attack, with hypoxic respiratory failure, resulting in low oxygen and respiratory distress. She had also been diagnosed with pneumonia during her hospital stay and had shortness of breath with minimal exertion making her a NYHA Class III. Due to her recent MI and an injection fraction of 20 percent, upon readmission to hospice, E.G.D. was diagnosed with end-stage heart disease. E.G.D.'s FAST score was 7f, she was 6 of 6 ADLs, had a PPS of 20 percent, and her weight had declined in the preceding month from 99 to 92 pounds. She was nonverbal and continued to be an aspiration risk. Her skin turgor was noted as poor and she was incontinent. Dr. Talakkottur opined that while E.G.D. had suffered a second heart attack, it was an acute event and not a terminal prognosis. He further argued that this patient's condition was chronic because there were no signs of angina, no shortness of breath, and no extended neck veins in a JVD test. In response, Dr. Shega noted that in the plan of care review, E.G.D. exhibited dyspnea at rest, had a FAST score of 7f, had a decreased level of consciousness and was lethargic. In Dr. Shega's opinion, JVD does not define end-stage heart failure. Rather, it just defines whether a patient is having an acute heart failure exacerbation at that time. Furthermore, research has shown that physicians, other than cardiologists, are not necessarily good at assessing JVD. According to Dr. Shega, Dr. Talakkottur also failed to take into account this patient's comorbidities, including end- stage dementia, which was likely a contributing factor to her sleeping 18 to 20 hours a day during her second admission and affecting her prognosis. 215. On 05/25/10, 06/08/10, and 06/22/10, E.G.D.'s cardiovascular condition was NYHA Class IV, with dyspnea at rest. During the benefit period beginning 09/17/10, this patient continued to be described as NYHA Class IV. And, while her weight increased to 110 pounds, she was still sleeping up to 20 hours a day, dependent in all ADLs, and had a PPS of 30 percent. During the last benefit period at issue, Patient E.G.D. continued to be NYHA Class IV, and had worsening edema. By 12/21/10, she was essentially unresponsive and the family revoked hospice to seek aggressive care in the hospital related to decreased appetite and decreased responsiveness. Dr. Talakkottur opined that there was nothing in the record to support a diagnosis of NYHA Class IV or significant symptoms of heart failure. In response, Dr. Shega pointed out those portions of the medical record that supported the fact E.G.D. had NYHA Class IV symptoms. As far as alleged lack of reports of frequent ER visits or hospitalizations, this patient was hospitalized for an acute MI less than a year prior to her initial hospice admission, was hospitalized again for a second heart attack immediately prior to her second hospice admission, and the family revoked hospice on 12/21/10 to readmit her to the hospital at the end of the last benefit period. AHCA has not met its burden by the greater weight of the evidence that E.G.D. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment for either period. Patient 25, M.M. Patient M.M. was a 57-year-old male admitted to hospice with a primary diagnosis of systemic lupus erythematosus ("SLE"). The dates at issue are 02/01/12 to 12/31/12. M.M. was first diagnosed with lupus in 1974, and also had a history of vasculitis, which resulted in several fingers amputated secondary to necrosis. M.M. also suffered from glomerulonephritis, an autoimmune disease that attacks the kidney. Other comorbidities included multiple surgeries on his right knee, a left ankle surgery with ultimate fixation, neuropathy, hypertension, morbid obesity, umbilical hernia, Cushing syndrome, diabetes, and a history of gastric ulcers, hepatic steatosis, sleep apnea, peripheral vascular disease, coronary artery disease, and chronic renal insufficiency. In the six months prior to hospice admission, M.M. had been admitted to the hospital four times: to amputate several fingers; for ileus; for chest pain; and for shortness of breath. M.M.'s primary care physician referred him to Vitas for end-stage SLE. Patient M.M. was initially admitted to hospice on 02/01/12. At that time, his PPS was 30 percent and his pain registered 8 of 10. He also suffered multiple weeping wounds on his lower extremities from edema upon admission and throughout his stay in hospice. His long time primary care physician noted, "in the face of aggressive medical care, the patient's condition continues to deteriorate." Over the claim period at issue, M.M. required multiple increased levels of care for pain management and decline in his overall condition. M.M. required continuous care on 03/14/12 for increased pain; on 09/27/12 for pain and change in level of consciousness; and on 10/27/12 for confusion, agitation, delusion and falls. M.M. required hospice inpatient care on 08/23/12 for shortness of breath and fever; and on 10/01/12 for a fall, nausea, vomiting, and low blood pressure. After a fall, M.M. was taken to the ER in July 2012 for a laceration on his left foot. He required another trip to the ER in December 2012 for a fall. In November 2012, he became severely anemic, requiring three units of blood. On direct, Dr. Talakkottur acknowledged that anemia is one of the symptoms of SLE. In his re-review, Dr. Talakkottur opined that M.M.'s condition overall was static throughout the claim period and questioned whether the patient even had SLE. In response, Dr. Shega noted that M.M.'s primary treating physician's records documented he had SLE. In addition, he noted M.M.'s multiple infections requiring antibiotics, as well was requiring numerous IPU and continuous levels of care during the period at issue. Dr. Talakkottur's re-review acknowledged that Patient M.M.'s functional performance had declined during the hospice stay to a PPS of 30 percent on his last recertification, dated 11/21/12. Dr. Talakkottur also testified that M.M.'s recorded weight was inconsistent and that he was addicted to pain medication. While there are acknowledged weight inconsistencies in the record, it is clear the patient was obese and his weight was not a factor in his prognosis. As to whether M.M. was addicted to pain medication, Dr. Shega opined that this patient was in severe pain and needed multiple titrations of opioid treatment to manage the patient's pain and attempt to improve his quality of life at the end. While he was dependent on pain medication, there was no evidence M.M. was addicted. Patient M.M.'s terminal condition was documented by his primary care physician, as well as by four hospitalizations in the six months prior to hospice admission, the multiple times he was placed in the IPU or on continuous care during hospice care, his ongoing edema with infections, a hospital admission in July 2012, and a trip to the ER in December 2012. M.M.'s extensive, well-documented comorbidities supported a prognosis of six months or less. For the foregoing reasons, Patient M.M. was Medicaid hospice eligible during all of the dates at issue. AHCA has not met its burden by the greater weight of the evidence that M.M. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Boynton Beach Recipients Patient 2, H.P. Patient H.P. was a 51-year-old female admitted to hospice with a terminal diagnosis of end-stage HIV/AIDS. H.P. had two admissions to hospice: 01/03/11 to 05/16/11; and May 2011 to October 3, 2011. The period that is in dispute is the last eleven days of H.P's first admission: 05/05/11 to 05/16/11. H.P. was discharged for extended prognosis. At the time of admission on 01/03/11, H.P. exhibited pain, diarrhea, poor oral intake, a very low CD4 count, and was weak. She had a history of noncompliance with her plan of care, anemia, chronic pain which included neuropathy from her HIV/AIDS, and a history of blood clots to her leg and her lung. This patient also had a history of kidney stones, depression, seizures, insomnia, frequent UTIs, diabetes, and asthma. On 05/05/11, H.P. was transmitted to an IPU and was simultaneously evaluated for extended prognosis and determined that the patient, on that date, had a prognosis that more likely than not, she would live longer than six months. Vitas began working to discharge this patient on 05/05/11, but was unable to make appropriate accommodations for her until 05/16/11. The discharge of H.P. took longer because H.P. had very few financial resources, had HIV/AIDS, and was Haitian with an alien resident card, all of which complicated the placement process. None of H.P.'s family that was contacted by Vitas would accept H.P. in their home, including her daughter, niece, and sister. H.P. also refused to go to a nursing home. Vitas contacted multiple Assisted Living Facilities (ALFs) and made nine attempts to secure placement, but the ALFs were full or refused to accept H.P. Dr. Shega opined that during this time, the patient had a terminal illness with a life expectancy of six months or less if the terminal illness ran its normal course. Dr. Eisner did not know the specific indicators with regard to prognosticating whether an HIV/AIDS patient had six months or less to live despite being offered as an appropriate peer reviewer. The period at issue was during H.P.'s initial 90-day recertification period. According to the audit instructions provided to some peer reviewers, if any day during a certification period was approved by a peer reviewer, then the entire certification period was to be approved. Dr. Eisner claimed he was not provided this document to perform the audit. Drs. Talakkottur and Komatz, however, were provided such instructions. According to the audit instructions, the period at issue is required to be approved. H.P. was Medicaid hospice eligible during all of the dates at issue. AHCA has not met its burden by the greater weight of the evidence that H.P. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 3, G.L. Patient G.L. was a 54-year-old male, admitted to hospice initially with a terminal diagnosis of adult failure to thrive and later, prostate cancer. The claim period at issue is 02/01/2012 to 12/31/2012. Dr. Komatz testified that during the disputed period, G.L.'s medical records demonstrated the recipient was stable on consecutive visits and exams and was not showing progression of his hospice diagnosis. Dr. Komatz testified that G.L.'s PPS score remained consistently at 50 percent, which, to her, showed the patient was stable at that point in time and was not showing further decline. Dr. Komatz's opinion was also based upon the fact that G.L. was independent with respect to his ADLs. Dr. Shega opined that during this time, the patient had a terminal illness with a life expectancy of six months or less if the terminal illness ran its normal course. Although G.L.'s PPS was stagnant at 50 percent, when coupled with G.L.'s increasing pain and other symptoms, cancer literature indicates that G.L.'s life expectancy was six months or less. Dr. Shega testified that it was his belief that Dr. Komatz did not take into account G.L.'s disease progression as indicated by the ever- increasing pain and increasing dosage of oxycodone given to treat the increasing pain. AHCA demonstrated that the medical records regarding this patient's weight were inaccurate. However, the patient's weight appears to have increased or remained relatively stable. Furthermore, Dr. Shega testified that he could not find any documentation to support the proposition that G.L.'s cancer had metastasized or to support that his prostate cancer had metastasized to the pancreas. The medical records contained in G.L.'s file do not support a finding that the Medicaid hospice eligibility standard was met during the disputed period. Based upon the greater weight of evidence in this case, it is determined that G.L. was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $51,686.51. Patient 5, G.R. Patient G.R. was a 41-year-old female admitted to hospice with a terminal diagnosis of debility unspecified. The claim periods at issue are 02/26/10 to 08/19/11 and 09/28/11 to 12/31/12. At 40 days old, G.R. contracted a measles infection, with a high fever, which had essentially left her disabled for her entire life. She had been nonambulatory and nonverbal for many years prior to her entering hospice care. G.R. was initially admitted to Vitas on 02/26/10. At the time of admission, G.R. had a PPS of 20 percent, was dependent in 6 of 6 ADLs, and had a FAST score of 7f. She exhibited muscle wasting and was nonverbal, disoriented, and drowsy. She had shortness of breath at rest, a Stage I ulcer on her foot, and had a PEG tube due to her high risk for aspiration. Just prior to admission, she had a UTI and was hospitalized. However, those hospital records were not provided to support her initial admission. G.R. also had a history of recurrent pneumonia. She presented extremely contracted, stiff, and weak. Dr. Shega admitted that although a physician's note indicated G.R. had been in a steady decline as she had been previously ambulatory and interactive, G.R., in fact, had been nonambulatory for 15 years prior to her hospice admission. During the first disputed period, shortly after admission, G.R. developed cellulitis around the PEG tube site that required antibiotics. Also, during the first admission, she developed pneumonia, a lower respiratory tract infection, and required Levaquin for ten days. G.R. was discharged for extended prognosis on 08/19/11. She was then seen by Dr. Patrick Kavanaugh, a non- Vitas treating physician, who re-referred G.R. back to Vitas hospice because he believed the patient was hospice appropriate. G.R. was readmitted on 09/28/11 with a terminal diagnosis of cerebral degeneration. She had a PPS of 20 percent, was dependent in all ADLs, had a FAST of 7f, was in a fetal position, contracted and unresponsive, was a very high aspiration risk, had difficulty swallowing, and was noted to have increased congestion. She was on Xanax, Tylenol, Benadryl, and nebulizers. During the second admission period, G.R. had skin breakdown on her left and right heels, had problems with congestion and aspiration, had worsening shortness of breath, and became more unresponsive such that by the end of the second period, she could not track people with her eyes. Skin breakdowns are specific indicators of nutritional impairment. Her condition also worsened such that by the end of the second period, G.R.'s secretion treatment had gone from medication only to also requiring manual suction to prevent aspiration. Dr. Talakkottur stated, in his rationale for denying the dates at issue, that G.R.'s skin was intact, which is inaccurate. Dr. Talakkottur also indicated that the patient's aspiration and congestion was chronic, but failed to take into account that those symptoms worsened over G.R.'s second period of hospice care. AHCA has not met its burden by the greater weight of the evidence that G.R. was not eligible for Medicaid hospice services during the second period in dispute, and it is not entitled to recover an overpayment for that period. The medical records contained in G.R.'s file do not support a finding that the Medicaid hospice eligibility standard was met for the first period in dispute. Based upon the greater weight of evidence in this case, it is determined that this recipient was not eligible for Medicaid hospice services for the first disputed period and that AHCA is entitled to recover an overpayment in an amount to be determined. Patient 6, S.B. Patient S.B. was a 30-year-old male admitted to hospice with a terminal diagnosis of cirrhosis of the liver. The claim period at issue is 10/06/11 to 01/03/12. S.B. was admitted directly to hospice from Broward Health Medical Center where he was hospitalized for liver failure and delirium tremens secondary to alcohol use. Liver failure was exhibited by an international normalized ratio ("INR") of 1.52 and an albumin of 2.2, a total bilirubin up to 28.5, ammonia of 86, and elevated liver function tests. S.B. had an altered level of consciousness and was disoriented. S.B. had a PPS initially of 30 percent that increased to 50 percent shortly thereafter with some ADL difficulty. S.B. had encephalopathy, decreased oral intake, and anemia. Both Dr. Talakkottur and Dr. Shega agree that this patient suffered from delirium tremens, which is basically a severe condition associated with alcohol withdrawal. Patients with liver disease often develop ascites. If the patient's condition is severe, a paracentesis procedure can be performed to remove the fluid. While the recipient was in the hospital, a paracentesis was attempted. S.B.'s paracentesis, however, was unsuccessful because there was no fluid to actually remove. Additionally, Dr. Shega admitted there was no evidence of ascites refractory to treatment in the medical records. Patients with liver disease often develop variceal bleeding, which are enlarged blood vessels in the gastrointestinal tract. If left untreated, the enlarged blood vessels can rupture and cause a patient to bleed to death. A patient with variceal bleeding has an increased risk of a poor prognosis and a more limited life expectancy. Dr. Shega admitted he could not recall evidence of variceal bleeding in the medical records for S.B. Dr. Talakkottur credibly testified that soon after S.B.'s acute episode of delirium tremens for alcohol withdrawal, he returned to being alert and oriented times three. In Dr. Talakkottur's opinion, S.B. could have been more appropriately served in an outpatient setting for his delirium tremens, which, in essence, was episodic. The medical records contained in this patient's file do not support a finding that the Medicaid hospice eligibility standard was met during the disputed period. Based upon the greater weight of evidence in this case, it is determined that this recipient was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $40,025.67. Patient 8, J.F. Patient J.F. was a 60-year-old male, admitted to hospice on 04/15/11, with a terminal diagnosis of cerebrovascular disease. The claim period at issue is 04/15/11 to 09/28/12. J.F. suffered a severe stroke and was hospitalized in March 2011, about a month prior to hospice admission. An MRI showed multiple infarcts that resulted in dysphagia, shortness of breath, confusion with disorientation, and poor oral intake. The patient was then readmitted to the hospital for a gallbladder- related acute infection and, at that point, the patient was referred by a hospitalist for evaluation of hospice services. On admission, J.F. had a PPS of 20 percent with comorbidities of diabetes, hypertension, depression, bipolar disorder, increased lipids, atrial fibrillation, and coronary artery disease. J.F. was extremely overweight. J.F.'s terminal diagnosis of cerebrovascular disease was evidenced by the severe stroke, poor functional status, significant dysphagia, and high risk for aspiration that is known to be associated with a poor prognosis, and two recent hospitalizations. A physician assessment indicated the patient was hospice appropriate and referred J.F. to Vitas indicating that the patient had a terminal disease. Upon admission, J.F. was extremely ill and required continuous care until 05/02/11, with recurrent fevers, shortness of breath, cough, and poor oral intake that ultimately resolved. In September 2011, he was noted to be incontinent, dependent in 6 of 6 ADLs, with a FAST score of 7d. J.F. continued to have issues with the shortness of breath and coughing with meals. In October 2011, he had increased weakness and cough, and his family called 911; and J.F. went to the ER where he was found to have severe bradycardia with a pulse of 48. There was concern the patient might be having a heart attack. The ER physician indicated that the chest x-ray showed cardiomegaly, or an enlarged heart, and also noted that the patient had mild heart failure at the time of admission to the hospital. The patient also had low-grade fever and an albumin of 2.6, documenting very poor nutritional status. From November through December 2011, the patient transitioned from the hospital to home on continuous care to further manage his dyspnea and lethargy. During that time, J.F. continued to have difficulty swallowing and had episodes of apnea for 10 to 20 seconds. From January through April 2012, J.F. had severe depression, was emotionally labile and weak, and still had problems coughing. Dr. Shega testified that depression is a complication of stroke and associated with a higher mortality. J.F. was put on an antidepressant, which improved his agitation and aggression, and he became more compliant with the medication regimen, but continued to have dysphagia. J.F. had high blood pressure and, given the labile hypertension, Vitas was concerned that it would precipitate a stroke. J.F.'s prognosis remained six months or less, so his blood pressure medications were continually adjusted. By the end of August 2012, J.F. demonstrated significant improvement by going from dependent for care in 6 of 6 ADLs, which he was the whole stay, to having the ability to feed himself; he also had improvement in dysphagia at that time. Consequently, Patient J.F. was discharged from Vitas for extended prognosis. J.F. met all applicable criteria for admission to hospice for the disputed period. Dr. Talakkottur also acknowledged that J.F. was acutely ill at admission to Vitas, was dependent in 6 of 6 ADLs until he was discharged, was confined to bed and chair and transferred from bed to chair with a Hoyer lift throughout his hospice stay, was incontinent of bladder and bowel throughout his stay, and had a FAST score that did not improve to better than 7a throughout his stay. AHCA has not met its burden by the greater weight of the evidence that J.F. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 10, A.R. Patient A.R. was an 83-year-old female, admitted to hospice on 1/10/11, with a terminal diagnosis of adult failure to thrive. The claim period at issue is 01/10/11 to 07/02/12. Upon admission, Patient A.R. had a recent ER visit in December 2010 at Columbia Hospital for mental status changes and a UTI, she had a PPS of 30 percent, was bedbound, and required assistance with 6 of 6 ADLs. Also at admission, A.R. had two right foot wounds and was disoriented. She was a nursing home resident in Palm Beach. An order was obtained from the physician for a hospice evaluation and services. A.R.'s comorbidities were mixed dementia of Alzheimer's and vascular disease, with history of stroke, hypertension, hip fracture with repair, coronary artery disease, UTI, pneumonia, diabetes, and increased lipids. A.R.'s weight over the previous five to six months, obtained from the medical record, dropped from 117 to 103 pounds (about a 12 percent loss) with a BMI of 20.5, reduced oral intake along with dysphagia and risk for aspiration on a pureed diet. A.R. had unstageable wounds on her heels in April 2011. She continued to lose weight in May 2011 (as of 5/16/11, she had a weight of 97.5 pounds with poor oral intake) and by July 2011, she continued to have a poor appetite and was known to be pocketing her food. Dr. Shega testified this meant her dementia was so severe that she would forget to swallow, which not only impacted her food intake, but also increased her risk of aspiration. Patient A.R.'s weight continued to decline and then, after her weight got to about 95 pounds, multiple interventions were put in place at the end of September to improve her nutritional status, including increasing her resource supplements to three times a day, and increasing her dosage of Remeron, a known appetite stimulant, as well as an antidepressant. A.R.'s weight increased to 102 pounds in December with a fair appetite, but still noted dysphagia and pocketing food. By January 2012, A.R.'s weight increased slightly, then decreased to 100 pounds, before increasing back to 103 pounds. Her weight then decreased to 97 pounds in February 2012, documenting A.R.'s extremely unstable condition. In April 2012, A.R. continued to have dysphagia on a pureed diet and a poor appetite. By June and July 2012, A.R.'s weight stabilized around 100 pounds, and she did not appear to be declining; consequently, she was discharged from Vitas for extended prognosis. Dr. Shega testified that Patient A.R. also had progressive contractures due to her severely debilitated condition. Dr. Shega noted that at each recertification period, A.R.'s prognosis was six months or less if her illness ran its usual course. A.R.'s fluctuating weight, as much as three to five percent per month at times, created a poor prognosis and put her at high risk of death, and she met Medicaid hospice eligibility without having documented ongoing infections or fevers. Dr. Talakkottur acknowledged that, during her entire hospice stay, Patient A.R. was on a pureed diet and required crushed pills due to dysphagia; and as a precaution against aspiration, was dependent in 6 of 6 ADLs, was confined to bed and chair, was incontinent of bladder and bowel, had a FAST level of no better than 7a, and had a PPS never higher than 40 percent. AHCA has not met its burden by the greater weight of the evidence that A.R. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 13, W.G. Patient W.G. was a 61-year-old male, admitted to hospice on 10/19/09, with a terminal diagnosis of end-stage cerebrovascular disease. The claim period at issue is 10/19/09 to 06/12/12. W.G. suffered a stroke in his 50s. Between 07/29/09, and 10/19/09, his nursing home requested he be evaluated for admission to hospice care. Vitas completed two Appropriateness Evaluation forms during this period for W.G. and, on both occasions, Vitas concluded that he was not eligible to receive the hospice benefit because his condition simply was not terminal. Ultimately, on 10/19/09, W.G. was admitted to hospice care with a reported terminal diagnosis of end-stage cerebrovascular disease. Respondent altered his terminal diagnosis to debility on 10/20/09. Dr. Shega opined that W.G. was eligible for hospice services because the patient had an ER visit prior to admission, became wheelchair bound, and had worsening dysphasia requiring an endoscopy. However, Dr. Shega admitted that the hospital visit and the endoscopy procedure both preceded the two Appropriateness Evaluations where Respondent failed to certify W.G. as eligible for hospice care. Moreover, the two Appropriateness Evaluation forms where Respondent declined to certify W.G. as eligible list his PPS score as 40 percent, yet the third Appropriateness Evaluation by which Vitas certified W.G. as eligible for hospice lists his PPS score as 30 percent. Notably, however, the next time W.G.'s PPS score is recorded in Vitas' records, it is back up to 40 percent. In this case, it is clear from W.G.'s medical records that he did not evidence deterioration in his nutritional status, pain control, breathing, or complication of his cardiovascular condition. Although W.G. received continuous care (a higher level of hospice medical attention) on occasion, W.G. returned back to his baseline status after each time of heightened care. Dr. Talakkottur credibly testified that patients who experience a stroke can have residual deficits, i.e., they may not be able to move an entire side of their body or walk, yet they live with the deficits for 20 or 30 years. In Dr. Talakkottur's opinion, W.G. was such a recipient who experienced deficits, yet he did not have a terminal diagnosis with a life expectancy of six months or less to live. Based upon the greater weight of evidence in this case, it is determined that this recipient was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $169,928.96. Patient 14, A.G. Patient A.G. was a 58-year-old male, admitted to hospice on 05/31/12, with a terminal diagnosis of end-stage liver disease. There are two claim periods at issue: 05/31/12 to 08/20/12 and 08/28/12 to 12/31/12. Patient A.G. was hospitalized at Broward Health on 05/18/12 with abdominal pain, imaging documenting cirrhosis with splenomegaly, no ascites, but significant liver dysfunction evidenced by a low platelet count, which supported portal hypertension associated with cirrhosis, elevated ammonia of 127, an INR of 1.4, albumin of 2.6, and a total bilirubin of 1.5. Chronic pancreatitis was also present and the patient had an elevated lipase of 392. A.G. had an altered level of consciousness with lethargy, and was at risk for aspiration. At admission A.G. was oriented times zero and only minimal arousal to painful stimuli. A.G. demonstrated a significant decline in liver function with encephalopathy, and the patient's primary care physician, who knew the patient very well, indicated that he thought A.G. had deteriorated and was hospice appropriate. Dr. Shega further testified that A.G. was Medicaid hospice appropriate at the time of admission to Vitas because the patient's laboratory values indicated severe liver dysfunction, including the INR and the albumin, along with elevated ammonia to corroborate the patient's confused mental status. A.G.'s clinical progression was documented by the primary care provider noting that the disease had taken a turn for the worse. Although the patient's weight was 188, he had an albumin of 2.5, which is very low, and demonstrated a decline in functional status with a PPS of 50 percent and some ADL impairment, which supported Dr. Shega's opinion that the patient had a prognosis of six months or less if the illness ran its normal course. During A.G.'s initial stay in hospice from 05/31/12 to 08/20/12, he had changes in mental status and lethargy indicative of hepatic encephalopathy. He also had dyspnea. Patient A.G. had two continuous care episodes: the first for lethargy and the second for pain and shortness of breath. He also required an IPU stay. Just prior to A.G. coming off service, he had an episode of thrush on 08/07/12 that required treatment with nystatin. Thereafter, A.G. went missing and was subsequently noted to be incarcerated. Being incarcerated does not disqualify a patient from Medicaid hospice eligibility. A.G. was readmitted to Vitas hospice on 08/28/12. Dr. Shega testified that A.G. was Medicaid hospice eligible at that time because he had lost weight from 188 to 180, continued to have abdominal pain rated 8 of 10, had shortness of breath with minimal exertion, had ascites, abdominal distension, and lower extremity edema. From 08/28/12 to 12/31/12, A.G. was dependent in 3 of 6 ADLs, his PPS score decreased to 40 percent, then to 30 percent, he had a poor appetite, and while his weight increased to 185 pounds, he continued to have lethargy, occasionally having shortness of breath with activity. By 12/31/12, his weight had decreased to 170 pounds. Dr. Shega testified that A.G. was eligible for Medicaid hospice services during the second admission period. On 11/17/12, the patient was receiving methadone at ten milligrams every eight hours for pain, which is a high dose, and he continued to need breakthrough medication for pain. A.G. continued to have shortness of breath with activity and continued to have weakness, nausea and vomiting, 3 of 6 ADL dependency, and a PPS of 40 percent. A.G.'s treating physician believed the patient was still hospice appropriate because of the ongoing pain requiring methadone for management, the shortness of breath with oxygen, and the nausea and vomiting which required an inpatient stay. Dr. Talakkottur acknowledged that while A.G. presented with an INR of 1.4 and an albumin of 2.6, a normal INR is 1.1 or below and a normal albumin is 3.5 or above. Consequently, A.G.'s INR and albumin levels were well outside of normal. Dr. Talakkottur also acknowledged A.G. had an altered mental status and lethargy, dysphagia, chronic pancreatitis, and comorbidities of congestive heart failure, COPD, diabetes, cirrhosis, hepatitis C, gallbladder disease, depression, schizophrenia, drug and alcohol abuse, a history of suicide attempts, and needed assistance with bathing and toileting. Dr. Talakkottur agreed that a patient is not disqualified from Medicaid hospice eligibility because of a past incarceration or for being a drug addict. Talakkottur acknowledged that A.G. also had ascites, edema, a PPS score that declined to 40 percent, and required oxygen. AHCA has not met its burden by the greater weight of the evidence that A.G. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 15, L.C. Patient L.C. was a 50-year-old female, admitted to hospice on 09/15/10, with a terminal diagnosis of stomach cancer (malignant neoplasm of the stomach). The four claim periods at issue are 09/15/10 to 10/26/10; 11/07/10 to 02/09/11; 03/11/11 to 03/24/11; and 03/23/12 to 04/05/12. Patient L.C. had a rare type of stomach cancer. Dr. Shega testified that in patients who have a more diffuse disease that is inoperable, the five-year survival rate is about 40 percent with treatment--if they pursue treatment--but the survival rate is unknown if the patient does not pursue treatment because most patients elect to pursue treatment. However, L.C.'s cancer was inoperable, which, by definition, means it was already diffuse. Patient L.C. had chemotherapy treatment on 09/06/10, prior to the first admission, and thereafter elected comfort care over more anti-tumor treatment. At the appropriateness evaluation, her PPS was 50 percent. Her previous weight four to five months prior to the first admission was 160 pounds and her weight at admission was 145 pounds, or a 9.4 percent weight loss. Patient L.C.'s BMI was 23.4. She reported 10 of 10 pain and had presented to the North Broward Medical Center ER with severe pain and was directly admitted to the Vitas IPU from the ER. In addition to pain, Patient L.C. reported poor oral intake and unintentional weight loss. L.C.'s primary care physician signed the oral certification of a prognosis of six months or less and was the attending physician for the patient. The Vitas medical director approved the admission, and given her underlying mental health, recommended a psychology consult and the use of methadone as the long-acting opioid to try to manage her pain. L.C. was seen by her primary oncologist, who referred the patient for hospice services and agreed with the admission. Patient L.C. had a history of Hepatitis C; hypothyroidism; schizoaffective disorder; bipolar disorder; a longstanding history of substance abuse; including crack cocaine; multiple suicide attempts; hypertension; tobacco use; and COPD. During the first period at issue, 09/15/10 to 10/26/10, Patient L.C. developed abdominal symptomatology, including pain, nausea, vomiting, cramping, and had underlying psychological/psychosocial challenges. L.C. was in the IPU for pain control for several days and then transitioned home, continued to have pain and titration of some of the medications, was switched from methadone to a Fentanyl patch due to some concerns in the home with possible diversion and abuse. L.C. then went to the IPU for an extremely high heart rate. Her PPS fluctuated, going as high as 80 percent. However, Dr. Shega testified that studies show that a high PPS score is still supportive of a terminal prognosis in cancer patients not receiving antitumor therapy. On 10/26/10, L.C. revoked services to pursue more aggressive treatment in the hospital, no longer wishing to follow the hospice plan of care. Patient L.C.'s second admission in Vitas hospice began on 11/07/10. Just prior to that, she was in the hospital and then readmitted to hospice service in her home. Her PPS was back down to 50 percent. Her previous weight had been 145 pounds and was now reported to be 130 pounds, with a BMI of 22, or a ten percent weight loss. L.C. reported 10 of 10 pain. While L.C. was in the hospital, she received one treatment with Gleevec, an antitumor treatment, and was then sent back for hospice services. Her case was discussed with her oncologist who agreed with the readmission to hospice. During the second period, 11/07/10 to 02/09/11, Patient L.C. was admitted to the IPU for pain, continued to have cachexia, her weight fluctuated, and she needed more Fentanyl to control her pain. She had substantial symptoms, including weight loss, muscle wasting, pain, shortness of breath with activity, agitation, depression, anxiety, early satiety, and nausea. Although L.C.'s PPS rose to 80 percent, she had a substantial symptom burden and was hospice appropriate. L.C. was discharged from Vitas hospice for not following the plan of care on 02/09/11. Patient L.C. began her third admission in Vitas hospice on 03/11/11, which lasted until 03/24/11. At the time of admission, L.C. was at home, had a PPS of 60 percent, her weight had decreased to 110 pounds, with a BMI of 18, reported 10 of 10 pain, and decreased oral intake. During the third admission, L.C. was admitted to the IPU. After the IPU admission, the patient was home for a very short period of time and came back to the IPU, but, ultimately, was discharged again for not being compliant with the plan of care. L.C. was readmitted to Vitas hospice for the fourth time on 03/23/12, until she was discharged again on 04/05/12, for not following the plan of care. Just prior to this fourth admission to Vitas, L.C. was on Heartland Hospice, and had been hospitalized at Holy Cross Hospital. At that time, when she ultimately revoked services from Heartland and transitioned to Vitas hospice, she had a PPS of 30 percent. Her weight was 110 pounds. A CT scan dated 03/21/12 noted that the patient had a large heterogeneous necrotic mass, which meant the mass was so big it outgrew its blood supply and the tumor cells died. It measured 20.5 by 20.5 by 20 centimeters (which is the size of two grapefruits) in the upper abdomen, compatible with malignancy or metastasis, origin uncertain. The mass encased portions of the stomach. Obstruction could not be excluded. L.C. had lost significant body weight, but her tumor's growth was leaving her weight the same. She also lost significant muscle mass. Dr. Shega testified that he had seen that occur several times in patients with this type of tumor. L.C.'s cancer was metastatic and the Vitas admission nurse noted on 03/22/12 that her treating physician in the hospital found that she had a days to a week prognosis that was very grim. During the brief fourth admission, L.C. had a large symptom burden and struggled while in the Vitas IPU trying to control her pain. Contrary to the opinion expressed by Dr. Talakkottur, the fact that L.C. may have been a drug addict had no bearing on whether she was terminally ill or her prognosis. AHCA has not met its burden by the greater weight of the evidence that L.C. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment for the four periods in dispute. Patient 17, D.D. Patient D.D. was an 84-year-old female initially admitted to hospice with a terminal diagnosis of adult failure to thrive. The three claim periods at issue are 09/27/10 to 03/21/11; 05/20/11 to 12/12/12; and 12/15/12 to 12/31/12. On 09/20/10, D.D. was admitted to the hospital for upper abdominal pain, nausea, vomiting, and was diagnosed with pancreatitis, complicated by a pseudocyst. Pseudocysts are associated as a complication of pancreatitis and associated with a significant mortality, particularly in older adults. Upon her initial admission to hospice, D.D. had a PPS of 30 percent, was dependent in 6 of 6 ADLs, bilateral lower extremity contractures, a weight decrease of 190 to 170 pounds, and an albumin of 2.1, which was consistent with severe protein calorie malnutrition. She also exhibited muscle wasting with a Stage II ulcer on her coccyx/sacrum that was open and draining. She had symptoms of abdominal pain, shortness of breath with exertion, decreased appetite, and bilateral lower extremity edema. She was considered at risk for aspiration, had a history of pneumonia, and had a UTI within the six months preceding admission. Patient D.D. also had a history of dementia, cholelithiasis with increased liver function tests, diabetes, arthritis, osteoporosis, reflux, and hypertension. D.D. was incontinent and confused. D.D. left hospice care on 03/21/11. She was experiencing a life-defining condition of a small bowel obstruction and a UTI that, if not treated at an acute care hospital, would have caused her death. Instead, her family elected to revoke the hospice benefit and pursue aggressive treatment. D.D. returned to Vitas hospice care on 05/20/11. She had again been admitted to the hospital with the small bowel obstruction, secondary to recurrent pancreatitis, along with complications from a COPD exacerbation that required IV steroids, bacteremia that required IV antibiotics, and anemia requiring a blood transfusion. At the second admission date, she had a PPS of 30 percent, was dependent in 6 of 6 ADLs, had contractures, and weighed 150 pounds. Her albumin was noted during her hospital stays at 1.9 to 2.1, again documenting severe protein calorie malnutrition. She had two right leg wounds, was a high risk for aspiration and had a very poor appetite with little oral intake. She had hypotension and was noted to have been in a steady decline for the past year. On 07/26/11, D.D. developed an acute infection that required antibiotics with Keflex. On 12/15/11, D.D. experienced shortness of breath requiring oxygen and pedal bilateral edema at two to three. On 04/09/12, three days after D.D. had a UTI, she experienced difficulty swallowing, profound muscle wasting, and was at grave risk of infection and skin breakdown. Her muscle wasting had progressed to bilateral temporal wasting. The Vitas physician noted that "[t]he patient is only alive today due to the excellent care given by her family as her debilitated state continues to put her at grave risk of infection and skin breakdown." On 07/11/12, D.D. was again seen by a Vitas physician. On this date, it was noted D.D. was becoming weaker with unexplained weight loss. On 08/22/2012, D.D. was seen by a Vitas physician who noted she continued to lose weight, was bedridden, and continued to decline. The patient was eating less, needed total care with ADLs, and had a history of UTIs. The Vitas physician stated: "[t]he patient is getting weaker. I saw the patient because the patient was weaker, and the patient, according to the daughter, is more lethargic all the time." In October 2012, D.D. had intermittent wounds including Stage II wounds on her back and right foot. During that month, the family also requested additional assistance taking care of D.D. at home, which is a service Vitas provides and is required to provide by statute. She then had another wound develop on 11/19/12. On 12/12/12, the family again revoked hospice. At that time D.D. developed a life-defining episode of diverticulitis. She had blood in her stool and was put on IV antibiotics in the hospital. She had an electrocardiogram ("EKG") which showed an atrial arrhythmia. Her hemoglobin was all the way down to 7.2--the normal range is 11 to 12. A hemoglobin of 7.2 is a severe level indicative of needing transfusions to prevent cardiac damage. Without an aggressive level of care, she most likely would have died. D.D. returned to hospice care on 12/15/12. At this time her terminal diagnosis was debility. She continued to be bedbound, contracted, dependent in all of her ADLs, with a PPS of 30 percent. Her albumin drawn from her latest hospitalization was still low at 2.7. She also had slightly worsening dysphagia. AHCA has not met its burden by the greater weight of the evidence that D.D. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment for the periods in dispute. Patient 18, M.S.V. Patient M.S.V. was a 77-year-old female admitted to hospice with a terminal diagnosis of respiratory failure. The three claim periods at issue are 06/28/11 to 08/10/11; 03/22/12 to 05/03/12; and 05/11/12 to 07/03/12. On 05/21/11, M.S.V. was admitted to the hospital with respiratory failure secondary to chronic obstructive pulmonary disease and interstitial lung disease, resulting in a very prolonged ICU stay. She had a tracheostomy and a PEG tube placed at that time. Her albumin was below normal at 2.7. She also had a pH of 7.11, which means her blood level was acidic instead of normal, which put her tissues at increased risk of death, such as heart arrhythmias. She also had a UTI and was on a ventilator. Her carbon dioxide level was 193--normal is 40--and her oxygen level was low at 64. Dr. Shega stated that studies show that when a carbon dioxide level ("PCO2") is over 75, the patient is admitted for acute exacerbations, sent to the ICU, and put on a ventilator, the six-month survival rate is 33 percent. In the months leading up to this hospitalization, M.S.V. had a GI issue that led to her having a colostomy. The colostomy was reversed during that hospital stay. The patient also had a history of tuberculosis, hypertension, and anemia. On 06/29/11, a non-Vitas physician certified M.S.V. had a life expectancy of six months or less. This was her primary care physician and attended the patient while in hospice. Her PPS was 30 percent at admission. A PPS below 70 percent is appropriate for hospice admission according to HI's instructions. During the first dates at issue, M.S.V. was admitted to the IPU and had challenges with secretions and choking and needed suctioning. She also had low-grade fevers during her IPU stay and episodes of tachypnea. She subsequently improved and was discharged for extended prognosis. M.S.V was readmitted to Vitas on 03/22/12. Prior to this, M.S.V. was admitted to the hospital with severe respiratory distress, was in the ICU again, was on a ventilator with a pseudomonas pneumonia that was complicated by a clostridium difficile colitis, a very severe infection of the large colon. On 03/31/12, M.S.V. needed five liters of oxygen on the trach collar, which is a substantial amount of oxygen, continued to have cough, secretions, congestion, and needed to be suctioned three times a day to remove green secretions. On 04/14/12, M.S.V. had confusion, was forgetful, and had dyspnea. She had rhonchi, cough, secretions, congestion with dyspnea, was still on five liters of oxygen, had abnormal lung findings and still required suctioning. She was on continuous care at that time. Continuous care is provided when a hospice patient has substantial skilled needs to manage their symptoms. Therefore, the hospice placed a nurse in the patient's home up to 24 hours a day to manage those symptoms. On 04/16/12, M.S.V. experienced shortness of breath and was very dyspneic with any type of exertion. She had weakness and required assistance with all ADLs. On 05/03/12, M.S.V. revoked hospice care. She had been in the IPU with a severe exacerbation of her respiratory symptoms requiring a seven-day course of Levaquin to help treat the increased secretions. She was also started on Prednisone for COPD exacerbation. She continued to struggle with secretions and near the end of the stay, she was having more lethargy, confusion and congestion. She revoked hospice care to seek aggressive care in the hospital. On 06/19/12, M.S.V. was seen at an acute care hospital and was diagnosed by a non-Vitas physician with end-stage pulmonary fibrosis. M.S.V.'s terminal diagnosis during the third period at issue was end-stage pulmonary fibrosis. On 06/20/12, M.S.V. had a heart rate of 124, which was markedly elevated with 100 being the upper limit of normal. She also had an elevated respiratory rate, was confused, agitated, somnolent, trying to take off her oxygen, and required Thorazine and Ativan to help control her symptoms. She had orthopnea, wheezing, cough, secretions, congestion, diminished breath sounds, required suctioning times four of thick yellow mucus, and was on continuous care and five liters of oxygen. M.S.V. developed respiratory infections during both the second and third claim periods in dispute. On 07/03/12, M.S.V. developed a temperature of 100.5, had agitation, anxiety, shortness of breath, increased congestion and increased lethargy. Her PPS was 30 percent at that time. She also was on Ativan and Thorazine and on eight liters of oxygen. She was congested with rhonchi, wheezes, rales, and dyspnea. She had shortness of breath at rest. She needed suctioning and was started on antibiotics. M.S.V.'s family then revoked hospice care for aggressive treatment. Dr. Talakkottur opined that because M.S.V. did not have increased ER visits, she was not showing evidence of decline. However, M.S.V. was hospitalized three times surrounding the dates at issue, had multiple instances of IPU and continuous care during hospice, and experienced multiple infections. Dr. Talakkottur also did not follow the standard of the Florida Handbook in that he denied a period due to no "significant" deterioration in the patient's condition. This is not a guideline for hospice eligibility--clinical progression of the terminal disease is a guideline. That progression is not required to be "significant" by any metric. AHCA has not met its burden by the greater weight of the evidence that M.S.V. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment for the periods in dispute. Patient 29, R.S. Patient R.S. was a 62-year-old male initially admitted to hospice with a terminal diagnosis of cerebral degeneration. The claim period at issue is 06/21/11 to 07/08/11. During the lead up to the dates at issue, R.S.'s status began to improve and Vitas was undertaking a review to determine if discharge was appropriate. On 06/21/11, R.S. suffered a fracture of the right clavicle while in an assisted living home. Fractures alone are associated with subsequent increased mortality in older adults (over age 60). In older adults, the fracture alters their homeostasis because they have homeostenosis. Any small change in the person's condition can lead to dramatic subsequent outcomes that increase the risk of mortality. The cause of death after the fall is variable, but it is often related to conditions, such as R.S.'s underlying condition. R.S. suffered from comorbidities of dementia, hypertension, paranoid schizophrenia, a history of seizures, benign prostatic hypertrophy of the prostate, a history of dysphagia, history of substance abuse, increased lipids, reflux, and a history of coronary heart disease. R.S. was also confused, nonverbal, and on oxygen. On 06/30/11, R.S. was a fall risk, was supervised at all times, and his mobility had substantially declined. R.S. was on Ativan to treat his anxiety and agitation, which also increased the fall risk and the risk of aspiration. Ativan was a new medication for R.S. prescribed to treat the anxiety and agitation and increased the risk of subsequent aspiration. Dr. Shega testified that agitation is a known manifestation of pain in persons with dementia. Particularly in a nonverbal patient who cannot say it hurts, he/she has to express himself/herself other ways. The American Academy of Neurology Guidelines for care of persons with dementia state that clinicians need to assess patients for pain and that includes agitation and dementia. R.S. was on morphine and Tylenol and then also on the Ativan to help control the agitation; however, all those medications can increase risk of aspiration. On 07/08/2011, R.S. was transferred to the ER for choking. He was in respiratory failure when he arrived and died shortly thereafter. Dr. Shega opined that the cause of death was related to his terminal diagnosis as fractures in patients with advanced dementia often change the trajectory of their illness and dramatically increases their likelihood of dying within six months. Dr. Talakkottur acknowledged that dementia patients can progress to the point that they can no longer swallow. It was undisputed that R.S. died of choking. Dr. Talakkottur inaccurately saw no correlation between R.S.'s fracture and his demise the following month. Dr. Shega's testimony was more credible than that of Dr. Tallakottur. AHCA has not met its burden by the greater weight of the evidence that R.S. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 21, A.D. Patient A.D. was a 63-year-old male admitted to hospice with a terminal diagnosis of adult failure to thrive. The claim periods at issue are 10/21/09 to 03/24/10 and 05/13/10 to 02/28/11. Just prior to hospice admission, A.D. had been hospitalized for heart failure which required a BiPAP. At admission to hospice, A.D. had a PPS of 30 percent, weight that had decreased from 150 to 140 pounds, a BMI of 22.2, shortness of breath at rest and with minimal exertion, lower abdominal pain, weakness, and difficulty ambulating. A.D. had comorbidities of COPD; polysubstance abuse including cocaine; marijuana; alcohol; and tobacco; hypertension; atrial fibrillation; coronary artery disease with stents being placed; gastroesophageal reflux disease; medical noncompliance; increased lipids; and depression. A.D. was certified to have a prognosis for a life expectancy of six months or less if the terminal illness ran its normal course by the independent third-party physician who treated A.D. in the hospital. On 10/22/09, A.D. was noted to have an EF of 15 percent. EF alone is not a predictor of reduced life- expectancy. Dr. Shega noted that it is the relationship between the EF and the patient's symptom burden that predicts increased mortality and hospice appropriateness. Dr. Talakkottur testified that a normal EF is above 55 percent. On 10/23/09, A.D.'s respiratory rate was elevated at 24. He was hypotensive with a blood pressure of 90 over 60, required morphine for pain, was lethargic but arousable, had chest pain, was on oxygen, and was short of breath with exertion. On 12/08/09, A.D. was placed on continuous care. He experienced dizziness when he sat up, which Dr. Shega opined was probably related to the patient's low blood pressure of 80 over 50, consistent with a severe NYHA Class. On 03/24/10, A.D.'s terminal diagnosis was changed to end-stage heart disease. He had chest pains and an extremely low heart rate of 40. A.D. revoked hospice care and was admitted to the acute care hospital with a severe life-defining infection in the defibrillator pocket. An infection of a pacemaker is a rare occurrence. A.D. required a transesophageal echo on 14/15/10. A transesophageal echo is a probe down the patient's esophagus to determine how the heart is functioning. Usually, a transesophageal echo is done when there is concern about endocarditis or infection of the heart valves. On 05/13/10, A.D. was readmitted to Vitas. His EF was again 15 percent and his PPS was 30 percent. He was drowsy, was an aspiration risk, and was NYHA Class IV with chest pain and dyspnea at rest and exertion. Symptoms of heart disease are not just shortness of breath. They also include chest pain, fatigue, weakness, or palpitations. At the second admission, A.D. was again certified to have a prognosis for a life expectancy of six months or less if the terminal illness ran its normal course by the independent third-party hospital physician. He received morphine for shortness of breath and still had shortness of breath with exertion. During the second period at issue, A.D. had a trajectory very consistent with end-stage heart disease with intermittent periods of shortness of breath or chest pain at rest or with minimal exertion. At times, he would show minor improvement in cardiac status, then decline. He did gain weight during this period but continued to exhibit NYHA Class III and Class IV disease status. He became weaker and spent more time in bed. His nutritional status improved, but other parameters fluctuated or remained end-stage, particularly the NYHA Class. He also experienced hypotension. A.D. ultimately passed away in hospice during an approved period. A study done by Joan Lunny published in the Journal of the American Medical Association("JAMA") on heart failure and end-stage lung disease patients showed that the patients have exacerbations, get worse, then improve. They may plateau. They may improve a little, but will then get worse again. This is visually displayed in the HI presentation "The Role and Function of Hospice Reviewers, "which depicts via a line graph the saw- tooth nature of the progression of the diseases. (Vitas Ex. 4). A.D. disease trajectory followed this chart. Dr. Talakkottur stated that A.D. showed no signs of acute cardiac disease at either admission, which is contrary to the medical records showing he had NYHA Class III or IV symptoms at both admissions. Dr. Talakkottur also stated that a low EF was not concerning in this patient because it could rebound in six months. However, as indicated above, A.D.'s EF was at 15 percent on the date of each admission, 10/21/09 and 05/13/10. Dr. Talakkottur also stated that this patient was not terminal as evidenced by a lack of increased utilization of health care, such as ER visits and hospitalizations. However, the patient had been hospitalized just prior to each admission to hospice. AHCA has not met its burden by the greater weight of the evidence that A.D. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment for the periods in dispute. Patient 23, S.V.D. Patient S.V.D. was a 44-year-old female admitted to hospice with a terminal diagnosis of end-stage liver disease with cirrhosis. The claim period at issue is 12/03/10 to 07/30/11. Just prior to hospice admission, S.V.D. had been hospitalized for vaginal bleeding, with a hemoglobin down to 2.5, which caused her to be admitted to the coronary care unit where she had a procedure in the hospital to help mitigate future bleeding, including an ablation and a dilation and curettage. She had an INR of 1.5 and an albumin of 2.1. She was jaundiced and had a bilirubin of 6. The upper range of normal for bilirubin is 1.1. She had a history of encephalopathy and multiple paracentesis. A paracentesis performed 11/29/10 removed five liters of fluid and a subsequent paracentesis on 12/03/10 removed four liters. Dr. Talakkottur opined that J.V.D. was not hospice appropriate because she failed to display signs of a terminal prognosis. Her PPS scores were between 30 and 50 percent, she was alert and oriented on the order of two to three, and she was able to ambulate throughout the period. Moreover, her albumin rose to 3.4, which was an improvement and marker of liver function. She had no recurrent or intractable infections, no respiratory problems, and her nutritional status remained good. However, upon admission, S.V.D. had an extremely elevated ammonia level, progressive malnutrition, and continued to use alcohol. She had a PPS of 40 percent, a BMI of 21.5, muscle wasting, weakness, shortness of breath, and a poor appetite. While the normal range for ammonia is 20 or less, S.V.D.'s ammonia level was 74. A BMI of 22 or less is considered significant nutritional impairment. On 12/03/10, a non-Vitas physician certified that S.V.D. had a life expectancy of six months or less if the terminal illness ran its normal course. On 12/08/10, S.V.D. had an INR of 1.53. This was drawn because S.V.D. needed another paracentesis, which occurred in the Vitas IPU on 12/09/10, and removed 1.5 liters of fluid. During the period at issue, S.V.D. exhibited impaired nutritional status with weight loss and muscle wasting, including bilateral temporal wasting. She also had jaundice, fatigue, periods of confusion, and encephalopathy. On 05/18/11, S.V.D.'s weight had decreased to 104 pounds with continued muscle wasting and bilateral temporal wasting with a poor appetite. She may have been abusing alcohol and was having worsening leg pain, probably from peripheral neuropathy related to alcohol. She had shortness of breath with minimal activity, was sometimes sleepy, alert and oriented, times two, with periods of confusion, which supported a diagnosis of encephalopathy. She required more assistance with ADLs and her PPS was 30 percent. S.V.D. had progression of her disease and was more easily fatigued, lost muscle mass, ascites, decreased appetite and weight loss, was sleeping sometimes for a whole day, and at times was too tired to eat. Dr. Talakkottur testified that S.V.D.'s nutritional status improved. Although her appetite did improve after the dates at issue, during the dates at issue, it was severely compromised. He also stated that he could not find any evidence of a compromised nutritional status. This statement was patently refuted by the record. Dr. Talakkottur argued as a reason for denying eligibility that the patient did not have further paracentesis. However, when the third paracentesis was drawn on 12/09/10, after admission to hospice, the fact that no future paracentesis would be drawn was not known. This is the type of revisionist review that is improper and cannot be used to deny eligibility after the fact. AHCA has not met its burden by the greater weight of the evidence that S.V.D. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 24, S.K. Patient S.K. was an 86-year-old female, admitted to hospice with a terminal diagnosis of end-stage cerebral degeneration. The claim period at issue is just over seven months, from 05/10/12 to 12/31/12. Patient S.K. had two recent hospitalizations to Northwest Medical Center for lower extremity cellulitis on 02/20/12 and on 05/04/12, just prior to admission. The patient had functional decline. In the hospital, her PPS was noted to be 20 percent. She became bedbound within the previous nine months. Before that, she was ambulatory. She had upper and lower contractures. She was described as lethargic with a FAST at that time of 7d. She was dependent in 6 of 6 ADLs, with a weight of 78 pounds and a BMI of 14.2. She had muscle wasting, along with anorexia, incontinence, cachexia, and poor appetite. S.K. also had dysphagia, was on a pureed diet, and was at risk for aspiration. The patient had Stage II pressure wounds to the right hip, right toe, and knee. Patient S.K.'s past medical history included dementia, hypertension, DVT of the right lower extremity, and a pressure ulcer of the right hip. Dr. Shega testified that Patient S.K. met the criteria for Medicaid hospice because she had two recent hospitalizations for infections; progression of her disease; functional decline with wounds; impaired nutritional status; with BMI markedly low at 14.2; a PPS at admission of 20 percent likely related to lethargy; and documentation that nine months prior, the patient essentially became bedbound. All of that documentation together indicated that she went from a chronic illness to end-of-life. Patient S.K.'s non-Vitas attending physician signed the oral certification that concurred the patient had a terminal illness with a life expectancy of six months or less if the illness ran its normal course and authorized Vitas to evaluate and admit the patient to the program. After S.K. was admitted to Vitas hospice, she experienced lethargy and low-grade fevers consistent with likely aspiration that slightly improved, and then she developed thrush in the first benefit period, which impacted her ability to swallow and eat. The thrush was appropriately treated. Thrush only happens in usually severely immunocompromised patients. She would cough when she ate, indicating her high risk of aspiration. In July 2012, S.K. was dependent in all ADLs. Her PPS was 30 percent, her FAST level was 7f, she had a Stage III wound, was nonverbal, was eating 50 to 60 percent of small meals, and had visible weight loss. She was in pain when being moved. She developed a wound on the right foot that had bloody drainage, so she had a hip wound and a foot wound. Her caregiver reported she slept most of the day, stared at the ceiling, and continued to document end-stage cerebral degeneration. S.K.'s hip wound resolved in August 2012. In October 2012, the patient developed another episode of thrush, again documenting her poor status. S.K. had dysphagia and coughed when getting liquids, which meant that when the patient was drinking, she was coughing, which dramatically increased her risk of aspiration because she was having a hard time controlling the texture; and at any time, it could get into her lungs and cause pneumonia or asphyxiation. S.K. was recertified as Medicaid hospice eligible on 10/27/2012. S.K.'s MMA had decreased, she remained bedbound with cachexia and muscle wasting, she was eating about 50 percent, she continued to need to be fed, she was given Percocet for pain as needed, had shortness of breath with oxygen as needed, her wounds had resolved, and she was at very high risk for infection given her bedbound status, severe malnutrition, and inability to care for herself. S.K.'s PPS remained at 30 percent, and she was dependent in 6 of 6 ADLs. Her home health aide visits had to be increased to seven times a week to help support the patient and family. Dr. Talakkottur acknowledged that Patient S.K. remained at a FAST level above 7, a PPS score of 30 percent or below, was incontinent of bladder and bowel, had dysphagia and was bedbound, and was 6 of 6 ADLs during the entirety of the dates at issue. S.K. met the disease specific criteria from the LCD for dementia and related disorders. As noted above, she had a FAST score above 7c, which indicates she was speaking six words or fewer, was 6 of 6 ADLs, and was incontinent. AHCA has not met its burden by the greater weight of the evidence that S.K. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 26, E.E. Patient E.E. was a 59-year-old male, admitted to hospice with a terminal diagnosis of end-stage liver disease. The claim period at issue is 09/01/09 to 04/30/10. E.E. had two hospitalizations for ascites and paracentesis prior to his stay in Vitas hospice. Upon admission, E.E. had a distended abdomen with 8 of 10 pain. E.E.'s skin was slightly jaundiced, he had a very poor appetite, and reportedly had not eaten in three days. The family and patient also reported issues with bloody noses and periodic bloody stool. At that time, the patient had a reported weight loss from 180 to 160 pounds or 11 percent of his body weight. E.E. was dependent in 5 of 6 ADLs, a PPS of 40 percent, dyspnea with rest and exertion, and confusion On 09/02/09, E.E. had two plus edema noted in his feet. As of 09/17/09, Patient E.E. had shortness of breath with activity and at rest. From a cognitive perspective, E.E. was confused at times and forgetful. He had bilateral edema in the extremities, was incontinent, under fall precautions, needed help setting up his food, and had very poor skin turgor with easy bruising indicating challenges with coagulation. Patient E.E. was extremely anxious, needed to be placed on an antibiotic for cellulitis, and was started on Aldactone for worsening edema. As of 11/30/09, while E.E.'s weight from admission in June increased from 160 to 180, his PPS remained at 40 percent, and he was having more pain in the abdomen related to ascites. The abdomen was described as distended. He continued to have confusion, forgetfulness, and agitation at times. E.E. also had lower extremity edema and now shortness of breath. E.E. was now on Lasix in addition to the Aldactone to try to control his edema. He continued to have a poor appetite. He was on lactulose to help manage his encephalopathy, which would not be expected in a 59-year-old without a dementia diagnosis, and he had confusion and forgetfulness; consequently, Dr. Shega concluded that was related to the end-stage liver disease. Dr. Shega testified that Patient E.E. was Medicaid hospice eligible at that time because he had ongoing manifestations of end-stage liver disease with worsening ascites, weight gain from the edema, a poor appetite, and required medication for encephalopathy. In February 2010, E.E.'s long-acting morphine was increased from 30 to 45 every 12 hours, he had pain, confusion and cognitive loss, was incontinent, had difficulty with ADLs, was eating about 25 percent of meals with anorexia, and had additional skin tears on his arms. E.E. had confusion, needed reorientation, and required a bed alarm on the bed because he might get up and fall. E.E. was prescribed an antipsychotic, Risperdal, at one milligram twice a day in March 2010 and had episodes of dyspnea requiring oxygen treatment. His PPS was 40 percent, pulse was 102, and had ongoing pain 8 of 10. He remained agitated with confusion and had aggression for which the antipsychotic was started. His Lasix dose was twice a day to try to manage the edema, and he continued to have intermittent dyspnea, ADL dependency, decreased appetite, easy bruising, and skin tears on both arms. In April 2010, E.E. continued to decline with increased confusion and weakness. He had new skin tears on both arms indicative of poor nutritional status. He had ascites along with his liver being able to be palpated. His weight was 165 pounds. He was lethargic, lying in bed with altered mental status; he remained on the lactulose and diuretics. His skin was jaundiced. Patient E.E. was Medicaid hospice eligible during all of the dates at issue. Dr. Talakkottur acknowledged that in March 2010, Patient E.E. became a fall risk, was dependent in 6 of 6 ADLs, and had periods of aggression and was very confused, which was possibly caused by encephalopathy. Dr. Talakkottur further acknowledged in final hearing that in April 2010, Patient E.E. had severe low back and abdominal pain, was on two liters of oxygen, required assistance with 5 of 6 ADLs, had skin tears, signs of ascites, and jaundiced skin. AHCA has not met its burden by the greater weight of the evidence that E.E. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 28, D.M. Patient D.M. was a 59-year-old male, admitted to hospice with a terminal diagnosis of malignant neoplasm of the prostate. The claim period at issue is just over seven months, from 05/26/12 to 12/31/2012. D.M. was admitted to Vitas on 05/26/12 with a terminal diagnosis of malignant neoplasm of the prostate (cancer). He died on service on 5/07/13. The "Scope" of the audit, as included in the FARs, states, "In addition, HI excluded recipients who had at least one malignancy (cancer) primary diagnosis and had a date of death less than one year from the first date of service with this provider." The undisputed evidence shows that D.M. had a terminal diagnosis of cancer and died less than one year after first receiving hospice care from Vitas. AHCA has the burden to prove compliance with the audit scope. It has not in this case. According to the scope of the audit, this claim must be excluded. Even if the scope of the audit did not preclude disputing this patient's benefits, AHCA failed to show this patient was not eligible. Just prior to admission in May 2012, Patient D.M. sustained a fall for which he had imaging that demonstrated diffuse metastatic blastic lesions and an elevated PSA to 302 nanograms per milliliter. D.M. also had left hydronephrosis, an enlarged bladder secondary to the prostate cancer that required Foley catheter placement. A CT scan demonstrated widespread blastic bony metastasis diagnosed as prostate cancer. The patient had substantial physical disability with a noted PPS of 40 percent, a reported weight loss from 150 to 140 pounds, and a BMI of 20. The patient had 6 of 10 groin pain and bilateral lower extremity edema. D.M.'s non-Vitas physician, Dr. Richard Mastrole, signed the certification attesting that the patient had a prognosis of six months or less if the illness ran its normal course and authorized Vitas to evaluate the patient for hospice services and admit him to the Vitas hospice program (signed and dated on 06/07/2012). D.M. also had a hematology consultation by Dr. David Drew. Dr. Drew noted D.M. developed weight loss of more than 20 pounds, close to 15 percent of his body weight, in the previous four to five months. He also noted that D.M.'s pain was so severe it interfered with his sleeping and eating. Dr. Shega testified that D.M.'s imaging demonstrated the blastic disease (prostate cancer) growing and invading into the bone. Dr. Shega further testified that the patient's alkaline phosphatase was markedly elevated to 600, which demonstrated the cancer was eating into the bone. The blastic lesions suggested that the tumor was actively growing and metabolizing the bone, destroying the bone, which is what was contributing to the pain. Within the bone, there are nerve fibers, and those nerve fibers were being stimulated by the cancer, which was destroying the environment. Dr. Shega testified that patients who have bony metastatic disease are at marked increase risk of subsequent fracture. D.M. was Medicaid hospice eligible at the time of initial certification because he had a terminal diagnosis of metastatic prostate cancer with known bony metastatic lesions that were blastic in nature, and a prognosis of six months or less if the disease ran its normal course. There were serial physician assessments of a hospitalization with all the physicians, including the patient's primary care doctor, documenting the patient had a prognosis of six months or less. D.M. had impaired nutritional status as documented in the appropriateness evaluation and in the medical record in the hospital. He had functional decline demonstrated by a PPS of 40 percent, which is markedly impaired. On 05/25/12, the day prior to admission, Patient D.M. met with the Vitas admission nurse and discussed that he had Stage IV prostate cancer and the Vitas hospice philosophy. The patient stated that he would be seeking aggressive care and would be seeing an oncologist in one to two weeks for chemotherapy and that he might also have an orchiectomy in two to three weeks per the urologist. However, D.M. did not follow through with aggressive care. In June 2012, Patient D.M. suffered a fall. X-rays did not document a fracture, but the fall indicated his overall weakness. In July 2012, Patient D.M. had a Stage I ulcer on the left leg that subsequently healed, but demonstrated that his nutritional status had not improved despite the weight gain. As of 08/10/12, D.M. was distressed and not getting adequate pain relief. He had pain in his pelvis, hips, and back relating to bone metastasis. On exam, palpation of different areas of his body exacerbated the pain; he had edema; and his appetite was declining, although he did not appear to be losing weight (due to the steroid treatment). He was also lethargic. Patient D.M. continued to have worsening pain during his stay in Vitas hospice, requiring more aggressive pain management. He was started on methadone, which is one of the most potent opioid analgesics, which was increased as the patient was on Vitas service. The increased pain and titration of opioids supported that the cancer was progressing and worsening. D.M. met the disease specific criteria from the LCD for cancer. As noted above, he had both metastases and a PPS below 70 percent. AHCA has not met its burden by the greater weight of the evidence that D.M. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 29, R.S. Patient R.S. was a 59-year-old male, admitted to hospice with a terminal diagnosis of debility. The claim periods at issue are 04/20/11 to 05/23/11 and 06/03/11 to 10/16/12. Prior to admission, R.S. was hospitalized for almost three weeks beginning on 03/02/11 for joint pain. At that time, the patient had severe electrolyte abnormalities, hyponatremia, along with a hemoglobin of 7.7. He was a known alcohol abuser and had an EGD that found gastritis in the stomach, along with a duodenal ulcer. He also had a UTI during that hospital stay and pneumonia. The patient was not safe to live independently and was placed in an ALF. Patient R.S. had a recent significant decline in functional status and became totally dependent in ADLs resulting in a PPS of 30 percent. R.S. had a poor appetite and an extremely low albumin level of 2.1. The patient became more confused, forgetful and developed extremity edema. He had a wound on his right foot. R.S. had peripheral vascular disease contributing to his diagnosis of debility, with severe functional disability. His prognosis in part was related to severe functional disability. This patient's comorbidities included dementia, atrial fibrillation, alcohol abuse for over 30 years, and a history of delirium tremens ("DTs"), gout, high blood pressure, COPD, anemia, and depression. R.S.'s primary care, non-Vitas physician, certified the patient for hospice and that the patient's prognosis was six months or less. After admission, R.S. developed a lesion on the outer aspect of the right foot that became necrotic due to poor circulation. Ultimately, R.S. had to be transferred to the IPU for management. Patient R.S. decided that due to the pain, he wanted an amputation and revoked hospice services to receive that amputation. R.S. was readmitted to Vitas hospice on 06/03/11 after his above-the-knee amputation at Columbia Hospital and was quickly thereafter admitted to Vitas' IPU for pain control. At that time, the patient's PPS was 40 percent. R.S. had ongoing 9 of 10 stump pain, which is common after an amputation, but he developed necrosis of the left heel, and he was admitted to the IPU for pain management. R.S. was Medicaid hospice eligible at readmission because he had the same terminal diagnosis of debility with the same clinical manifestations, but now had a left heel ulcer; the patient had just come out of the hospital after a life-defining condition and was referred to hospice services from that hospitalization; and, functionally, the patient had a PPS of 30 percent. Those indicators together demonstrated that Patient R.S. continued to have a prognosis of six months or less if the illness ran its usual and normal course. As of 06/11/11, Patient R.S. continued to have pain and had a new necrotic area on the left heel, cachexia and muscle wasting, a poor appetite, and was increasingly confused at times with increasing dementia. As of 08/20/11, R.S. had ongoing cachexia, muscle wasting, continued pain, progressive dementia, and continued to have the wound on the left heel, which was necrotic, and was having regular wound care and needed to be debrided, which was a systemic manifestation of the peripheral vascular disease. In December 2011, R.S. was noted to have poor skin turgor, was at high risk of developing additional skin breakdown, and his skin temperature was cold due to the peripheral vascular disease. The patient had an open coccyx wound, along with a wound to the left outer knee. The ongoing wounds suggested that the patient's nutritional status had not improved and that he continued to be hospice appropriate. The wound tissue was dead and not healing very well and Santyl, a chemical debrider, was administered to remove the dead tissue, indicating a severe wound. R.S. was steadily declining as evidenced by increased weakness and skin breakdown. In May 2012, R.S. had urinary symptoms along with increased lethargy and forgetfulness. He was started on an antibiotic for UTI. His condition was steadily declining, requiring frequent repositioning in bed and had poor balance. R.S. had an active infection. In his debilitated stated, it was considered a life-defining infection making R.S. hospice appropriate with a prognosis of six months or less if the illness ran its usual and normal course. In July 2012, R.S. needed increased pain medication to help manage his symptoms and was transitioned from morphine to methadone for the neuropathic pain he was experiencing. He remained bedbound, incontinent, and dependent in all ADLs. He had persistent sleepiness throughout the morning and difficulty staying awake, a sign of end-stage disease. He had shortness of breath along with anorexia, anxiety and depression, and a PPS of 30 percent. R.S. continued to have poor blood flow to the leg with decreasing sensation and decreased pulses in the left leg, putting it at very high risk for subsequent skin breakdown and the risk of an additional ulcer was very high. He had decreased breath sounds and scattered rhonchi. R.S. was also complaining of urinary symptoms and was started on another antibiotic for a UTI. As of 08/27/12, R.S. continued to demonstrate severe physical disability, with a fair appetite, poor skin turgor, and a right shoulder wound that was open and draining, consistent with an infection. His right shoulder had a raised area with redness, hard, moderate drainage, and he was started on an antibiotic to treat the infection. Patient R.S. was discharged from Vitas hospice in October 2012. The patient was presented to the Vitas medical director review for a possible extended prognosis. The patient's pain was much better controlled with titration of medications. The patient's weight had increased and his appetite had improved. The patient currently did not have any wounds, and previous wounds had healed. The infection in August 2012 had resolved. Patient R.S. did not need a higher level of care. At that time, the medical director believed that the patient had a prognosis greater than six months if the illness ran its usual course. At final hearing, Dr. Talakkottur acknowledged that R.S., at initial certification, had a history of dementia, was incontinent, required full assistance with ADLs, had a necrotic toe, was bedbound and wheelchair-bound. He revoked hospice on 05/23/11, and shortly thereafter had his necrotic and gangrenous foot amputated above the knee. Dr. Talakkottur further acknowledged that during R.S.'s stay in hospice, he did not have a PPS score above 40 percent, his condition was slowly declining, evidenced by delayed wound healing and increased weakness. R.S. had muscle wasting, severe low back pain, became anorexic, continued to be incontinent of bowel and bladder, was too weak to get out of bed, developed a Stage III decubitus ulcer, and had a UTI and cellulitis. AHCA has not met its burden by the greater weight of the evidence that R.S. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment for the two periods at issue. DADE RECIPIENTS Patient 1, A.B. Patient A.B. was a 34-year-old female admitted to hospice with a terminal diagnosis of end-stage AIDS. The claim periods at issue are 02/12/11 to 07/18/11 and 10/18/11 to 12/30/11. A.B. was hospitalized just prior to hospice admission on 02/04/11 for shortness of breath, cough, weakness, and pneumonia. On admission to hospice, A.B.'s weight had decreased from 189 pounds to 160 pounds in the previous five to six months. She also had a CD4 count of less than four. She was having difficulty chewing and was on a mechanically soft diet. A.B. had a history of several pneumocystis pneumonias, which Dr. Vermette stated is one of the sentinel opportunistic infections that define a patient as having AIDS, instead of HIV, and is a very serious type of pneumonia that is difficult to treat and eradicate. She had a PPS of 40 percent. A.B. had numerous admissions to Vitas continuous care and IPU. She was admitted to continuous care at the time of admission. On 02/17/11, she was admitted to the IPU. She was again placed on continuous care on 02/19/11. She was admitted back to the IPU on 03/23/11 for difficulty breathing and a respiratory infection. A.B. was re-admitted to the IPU on 04/11/11 for pain, and admitted again on 04/21/11 due to vomiting and pain. She was admitted to the IPU on 05/12/11 for abdominal pain and diarrhea. She was again admitted to the IPU for chest pain on 05/19/11. She was placed on continuous care for pain management on 06/10/11. A.B. was again transferred to the IPU on 07/04/11 for vomiting and abdominal cramping. On 05/10/11, A.B.'s weight had decreased to 157 pounds, she was cachectic, had shortness of breath managed with oxygen and bronchodilators, had a PPS of 40 percent, had increased episodes of confusion, agitation and forgetfulness, and was recently treated for oral candiasis. A.B. was discharged on 07/18/11 when arrested. On 10/18/11, A.B. was readmitted to Vitas hospice. Between the two hospice admissions, A.B. was again seen at the Magic Johnson Healthcare Center. In August 2011, her CD4 count was less than six. On 09/19/11, her weight was 151 pounds. She was taking her AIDS and heart medications without improvement and with periods of noncompliance, which are both indicators of worsening prognosis. At admission, A.B. had a PPS of 40 percent, a weight of 150 pounds, was having significant pain, shortness of breath at exertion and rest, ulcers and lesions on both legs, a history of recurrent infections, and had been discontinued for antiretroviral medications. On 10/19/11, A.B.'s attending physician certified her as having a life expectancy of six months or less if her terminal illness ran its normal course. On 11/12/11, A.B. was admitted to the IPU for pain management, at which point her PPS had decreased to 30 percent. On 11/20/11, A.B. was again admitted to the IPU for shortness of breath and chest pain. Her respiratory rate was extremely high at 28 and her pain medications had been changed from Percocet to morphine. On 12/01/11, A.B. had a CD4 count of 20, which was still in the terminal stage. She also had decreased appetite, increased weakness, and a PPS of 40 percent. On 12/30/11, A.B. revoked hospice care to seek surgery for recurrent diarrhea and gastrointestinal issues. Dr. Talakkottur stated as his rationale for denying eligibility that there was a lack of CD4 labs during the first admission, that her PPS remained at 40 percent, that she had no frequent hospitalizations, and that she had no recurrent infections. These statements are all contrary to the evidence. Dr. Talakkottur admitted A.B. had multiple hospitalizations leading up to hospice, serial assessments and lab work in the two years leading up to hospice, ten higher levels of care during her first admission, a CD4 count of less than 4 at admission, a PPS that dropped to 30 percent, and documented recurrent infections (pneumocystis pneumonia and thrush, which are opportunistic infections). At hearing, Dr. Talakkottur relied on the study "Mortality and Well Controlled HIV and the Continuous Antiretroviral Therapy Arms of the SMART and ESPRIT Trials Compared with the General Population" dated 03/27/13, by A.J. Rodger. The study, published after the end of the audit period, was not available to Vitas in 2011 when physicians were making real time prognoses regarding patient A.B. In addition, the patients examined in the study were only those with a CD4 count of greater than or equal to 350. With CD4 counts always at or below 20, A.B.'s condition would exclude her from the parameters of this study. Dr. Talakkottur acknowledged that the lower the CD4 count, the more susceptible a person is to infections and that these infections can increase the risk of morbidity and mortality. He also acknowledged that not taking AIDS medication increases the patient's chances of getting opportunistic infections. Patient A.B. was not compliant with medication. AHCA has not met its burden by the greater weight of the evidence that A.B. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment for the two periods at issue. Patient 4, E.M. Patient E.M. was a 70-year-old male, admitted to hospice with a terminal diagnosis of end-stage COPD. The claim periods at issue are 12/21/11 to 05/13/12 and 05/15/12 to 12/31/12. Patient E.M. was hospitalized on 11/30/11 through to his initial admission to Vitas. He had shortness of breath and a pulse oxygen reading of 88. He responded poorly to treatment with bronchodilators and had a wound on his sacrum. He had a carbon dioxide pressure of 67, which was very high and implied the patient was not able to flush the carbon dioxide out of his lungs because of his disease. He had acidosis in his bloodstream of 7.32. Acidosis in the bloodstream can be extremely life- threatening it if drops below 7.25 or 7.2. An acidosis level of 7.32 shows that despite E.M.'s body's best effort to compensate for the retained carbon dioxide that his lung disease was causing, he was not able to maintain homeostasis. During the 11/30/11 hospital stay, Patient E.M. was placed on BiPAP, which at the time was the most aggressive nonintubation treatment available. He remained on BiPAP for about 22 days, despite efforts to ween him off before being referred to hospice. At the time of discharge from the hospital, E.M. was informed that he did not have many options to improve his condition. E.M. was certified hospice appropriate by his non- Vitas attending physician. He was admitted with evidence of extensive disease as identified above and a BMI of less than 19. At admission, E.M. was placed on continuous care while on eight medications to treat his respiratory symptoms. In January 2012, E.M. lost consciousness and was sent to the ER. On 03/09/12, E.M. had cough, congestion, and secretions, and had to be started on another antibiotic. On 03/15/12, E.M. had a PPS of 40 percent, was short of breath and on oxygen 24 hours a day. He could stand with assistance but could not walk freely. He had a poor appetite and slept day and night, which was evidence of progression as end-stage COPD patients require increased sleep and rest. E.M. had crackles in his lungs which were consistent with end-stage lung disease. He also had apnea during the first benefit period, which is more significant in COPD patients, because there is a chance they never start breathing again. Most COPD patients, who do not die of some other cause, die of acute respiratory arrest. Apnea in an end-stage COPD patient is a significant indicator of a poor prognosis. E.M. revoked hospice care on 05/13/12 and was treated at Baptist Hospital of Miami for intractable shortness of breath. He was discharged from the hospital on 05/15/12 and re-admitted to hospice that same day. At the second admission to hospice on 05/15/12, E.M. had shortness of breath, was coming off the recent hospitalization, had decreased weight from 121 pounds to 109.5 pounds, was chair-bound, had chronic kidney disease, bronchial asthma, and a PPS of 40 percent. He was placed on continuous care on admission. Upon readmission on 05/15/12, E.M. had muscle wasting, was unable to be weighed, had shortness of breath with continuous oxygen usage, and had decreased tolerance to activity and increased weakness. Dr. Talakkottur relied on the Global Initiative for Obstructive Lung Disease ("GOLD") Criteria for COPD for denying eligibility during the periods at issue. However, the GOLD criteria were developed to standardize what treatments are started when in a step-by-step organized fashion for COPD patients. GOLD is designed to treat patients to keep them out of the hospital. Dr. Vermette stated that the GOLD criterion has no relevance to a patient in E.M.'s condition who is already on eight medications, which is far beyond the GOLD criteria. Dr. Talakkottur's reliance on a spirometry test for prognosis is similarly misguided. A spirometry test is helpful to determine treatment and medication. Dr. Vermette stated that once a patient's COPD has progressed to the severity of E.M.'s, spirometry is inconsequential. The six-minute walk test is also irrelevant for a patient who has an illness as advanced as E.M. That test is to determine how many breathing treatments a patient needs and has no impact on prognosticating life expectancy. Dr. Talakkottur believed E.M. should have performed a six-minute walk test to determine the severity of his COPD, despite being unable to walk for six minutes (mainly bed and chair-bound). On 08/13/13, E.M. was forced to sit in a tripod position, trying to actually push air in and out of his lungs, not just with his diaphragm. He also exhibited global muscle atrophy, which meant all the muscles in his body were shriveling. This was evidence of both functional and nutritional impairment. COPD, by definition, is a chronic disease from the time of diagnosis. It does, however, enter an end-stage as evidenced by symptoms such as having shortness of breath at rest, being in and out of the hospital with intractable shortness of breath, being oxygen-dependent, and being on eight medications. E.M. exhibited specific indicators of "progression of end stage pulmonary disease" for the LCD for pulmonary disease. As noted above, he had hospitalizations due to his COPD both immediately prior to admission and during his stay in hospice. AHCA has not met its burden by the greater weight of the evidence that E.M. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment for the two periods at issue. Patient 6, G.O. Patient G.O. was a 90-year-old male admitted to hospice with a terminal diagnosis of end-stage heart disease. The claim period at issue is under three months, from 05/21/12 to 08/18/12. Just prior to being admitted to hospice, G.O. had been hospitalized for multiple complex problems, including sepsis, left lower lobe pneumonia, severe anemia, and had a heart attack while in the hospital. He was referred to and certified for hospice by his attending physician. Dr. Vermette opined that G.O. was terminally ill with a prognosis of six months or less to live and his condition and symptoms were indicative of a NYHA Class IV because he suffered from shortness of breath at rest. NYHA Class III and Class IV patients will present with shortness of breath, chest pain, fatigue or palpations at rest; any of those symptoms occurring at rest would stage a person at Class IV and be considered an indicator of a poor prognosis. However, Vitas's file for G.O. seems to belie a finding that he met the standards for NYHA Class IV or Class III. The Plan of Care Review documents during the disputed timeframe fail to indicate that G.O. ever suffered from shortness of breath at rest--the hallmark for NYHA Class IV. One plan in the disputed timeframe remarks upon the recipient's respiratory system, but all other plans have no comment for the recipient's respiratory status. The plan dated 08/30/12, indicated the recipient had shortness of breath and received oxygen. Not all plans are indicative of the recipient having dyspnea. Those that are checked to indicate the recipient had dyspnea do not all suggest it was with exertion. Not one indicated dyspnea at rest. In the initial nursing note following G.O.'s hospice admission, a nurse assessed the recipient and checked that no problems were identified with the patient's neurosensory, cardiovascular, or respiratory systems. The patient was in no pain. G.O.'s vital signs in the cardiovascular section were reported within normal limits. Subsequent nursing notes reported G.O. having no shortness of breath, having no level of concern with his respiratory status, reporting oxygen was used "as needed" or "PRN" and that G.O. reported no level of concern with his respiratory system. In the cardiovascular system of the same notes, G.O. was reported to have no dyspnea at rest. Many notes were not checked for dyspnea and most reported the recipient had a "0" level of concern with his cardiovascular system. Further, the Appropriateness Evaluation form failed to support the patient being NYHA Class IV. The form notes that the recipient had shortness of breath with minimal exertion and not at rest. The respiratory system section of the evaluation is marked not applicable and the cardiovascular section does not indicate that the patient had dyspnea at rest, but instead noted only that the patient had dyspnea on exertion. Based upon the greater weight of evidence in this case, it is determined that this patient was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $38,253.17. Patient 9, L.B. Patient L.B. was a 70-year-old female, admitted to hospice with a terminal diagnosis of end-stage vascular dementia. The claim period at issue is 11/12/10 to 03/05/12. L.B. had been hospitalized for a stroke just prior to hospice admission. Dr. Talakkottur acknowledged the stroke was severe. At admission, L.B. was on a PEG tube, had quadriparesis, breast cancer, hypertension, and contractures in her lower extremities caused by brain damage. She was total care, 6 of 6 ADLs, and incontinent, with a FAST of 7f. She had a PPS of 30 percent. L.B. also had renal insufficiency, dysphagia, malnutrition, and required oxygen supplementation. Patient L.B.'s FAST score of 7f demonstrated functional impairment, along with quadriparesis and constrictors, which indicated that her disease process was advanced. On 11/15/10, L.B.'s non-Vitas attending physician certified that the patient was appropriate for hospice and had a terminal diagnosis. Dr. Vermette testified that once a dementia patient reaches the equivalent debility of a FAST 7a, has functional decline, and has other significant comorbidities, then the patient is considered to have a terminally ill prognosis. L.B. had those conditions at admission. On 12/29/10, L.B. had an albumin on the lower end of normal at 3.6, had an abnormal lung exam with decreased breath sounds and rhonchi, and had dysphagia. Dr. Vermette testified that abnormal breath sounds and rhonchi in a patient with a PEG tube was a sign the tube feeding was not tolerated and placed the patient at a higher risk of aspiration. On 01/24/11, L.B. had a fever of 100 degrees. Her blood pressure medication was also increased. Dr. Vermette testified that stroke patients have an increased risk of stroke when their blood pressure is high. L.B. remained incontinent during the first certification period. On 02/10/11, L.B. had a PPS of 30 percent, was dependent in 6 of 6 ADLs, had a FAST score between 7d and 7e, had contractures, weakness, high blood pressure, a lesion on her lower lip, and incontinence. Dr. Talakkottur opined that he saw no progression of the terminal illness. He opined the recipient's clinical state was static. Dr. Vermette explained that with these indicators, L.B. would not be able to decline significantly until her actual death, and so it would be expected for her PPS, ADLs, and FAST scores to remain static. Most patients in this condition die of an aspiration or respiratory event at some point in the course of their care. On 04/01/2011, L.B.'s PPS dropped to 20 percent before returning to 30 percent later that month. L.B. also developed a Stage II wound on her right buttock and sacrum, which persisted into May. On 05/09/11, L.B. had mild shortness of breath, had some congestion and excess secretions and was placed on atropine drops, an anticholinergic medicine used to dry up the oral/nasal secretions. Dr. Vermette testified that with dysphagia, the secretions would end up in the patient's lungs and she would have significant respiratory distress. On 06/24/11, L.B. was placed on Pro-Stat because her wounds were not healing with conventional treatment. Her PPS remained 30 percent, her FAST was 7d to 7e, and she still had decreased breath sounds and rhonchi. In August 2011, L.B. had wounds on her great toe and coccyx. On 09/08/11, L.B. was moaning and groaning at times and medicated with morphine for pain and still required ongoing wound care. On 09/24/11, L.B. still had a PPS of 30 percent, was 6 of 6 ADLs, had wounds, and increased secretions. The increased secretions increased L.B.'s risk of aspiration. On 10/27/11, L.B. had a FAST of 7f, was total care, and her PPS was 30 percent. L.B. had increased pain and increased secretions. She also had decreased tolerance to activity and decreased tolerance to being placed in a chair with a Hoyer lift. On 12/20/11, L.B.'s breast mass was increasing, her FAST was 7f and her PPS was 30 percent. She had contractures and chest congestion. Dr. Talakkottur stated a patient like L.B. could live for ten or 20 years. Dr. Vermette opined that L.B. was displaying the signs of the last six months of life if the disease progresses normally--advanced dementia with a FAST in the 7s, a PPS level in the 30s, recurrent problems with secretions, contractures, and wounds. In fact, L.B. did not live ten years but instead died on service at Vitas on 04/24/12. AHCA has not met its burden by the greater weight of the evidence that L.B. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 10, G.S. Patient G.S. was a 74-year-old female admitted to hospice with a terminal diagnosis of end-stage dementia. The claim period at issue is just under seven months, 09/01/09 to 03/26/10. Prior to admission to hospice, G.S. had aspiration pneumonia, a PEG tube, and ongoing dysphagia. In September 2009, G.S. had a PPS of 30 percent, a FAST of 7d, was incontinent, and weighed 107 pounds. She had gastroesophageal reflux disease as a comorbidity. G.S. was dependent in 12 of 12 ADLs, which is the same as 6 of 6, but on a different scale. She had episodes of congestion and cough related to dysphagia, which gave her a higher risk of aspiration, and she also had a recent UTI that required an antibiotic. Patients with dysphagia and gastroesophageal reflux disease who cannot swallow normally and are having liquid food pumped into their stomach have an increased risk for aspiration, making it a significant comorbidity. In October 2009, G.S. developed wounds on her left foot and left elbow. She was bedbound with contractures. Her wounds evidenced poor nutritional and functional status, as well as an increased risk of infection. In November 2009, G.S. remained total care, FAST 7d, and bedbound. She had impaired bed mobility--she could not reposition herself in bed by herself and her wounds had not healed. In January 2010, her left elbow wound was open, her FAST was 7d, she was total care, and she had an episode of vomiting. Dr. Vermette stated that G.S. was at an especially high risk of aspiration because when she vomited she could not lean over the bed or sit up to reposition herself but was forced to lie there and hope someone assisted her before she choked. G.S. began having shortness of breath at rest during January and February 2010. In March 2010, G.S. began tolerating placement in a chair better and her PPS increased to 40 percent. Vitas discharged her for extended prognosis on 03/25/10. Dr. Vermette stated that the patient's PPS and ADLs remained the same throughout the dates at issue, but she also had infections, wounds, and a risk of aspiration that evidenced a terminal prognosis of six months or less. He testified that G.S. was what a terminal dementia patient looks like. Dr. Talakkottur stated that G.S.'s wounds and UTI ultimately healed with appropriate treatment. He did not mention that it took nearly four months for the wounds to heal. Moreover, he could not have known in real time that those wounds would ultimately heal four months after they began. L.B. met the disease specific criteria from the LCD for dementia and related disorders. As noted above, she had a FAST score above 7c, which indicates she was speaking six words or fewer, was total care, and was incontinent. AHCA has not met its burden by the greater weight of the evidence that G.S. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 11, J.A. Patient J.A. was a 64-year-old male, admitted to hospice with a terminal diagnosis of end-stage heart disease. The claim period at issue is under three months, from 06/12/11 to 09/09/11. Prior to admission, J.A. had two significant hospitalizations. He was hospitalized from 05/10/11, to 06/02/11. During that hospitalization, he suffered a heart attack, respiratory failure, aspiration pneumonia, and encephalopathy. He had cardiomyopathy with an EF of ten percent and had congestive heart failure. He had several other comorbidities, including respiratory insufficiency, atrial fibrillation, diabetes, hypomagnesemia, which means low magnesium in the blood, and hypertension. J.A. was readmitted to the hospital on 06/04/11. He was in the hospital from 06/04/11 to 06/12/11, for altered mental status and was admitted directly to hospice from the hospital. At the time of his admission, J.A. was confused, had reduced ambulation, needed assistance with self-care, and had a PPS of 40 percent. He had a heart attack, which required intubation. He had an EF of 15 percent. He was jaundiced and was found to have cirrhosis with end-stage liver disease as a comorbidity. He had a JVD of three centimeters and diminished breath sounds. Dr. Vermette testified that J.A. had a prognosis of six months or less if the disease progressed at its expected rate because he had significant evidence of severe heart disease, multiple hospital admissions, and radiologic evidence of end- stage disease. He had a declining functional status, a PPS of 40 percent, and had just been intubated after a heart attack; consequently, it was very reasonable to assume that he had entered the terminal stage of the disease. Dr. Vermette testified that the prognosis is very limited for patients that have to be intubated and on a ventilator for five days after an acute heart attack, together with the other conditions affecting J.A., including the aspiration pneumonia. During June 2011, J.A. was admitted to the IPU. He continued to have significant symptoms of heart disease and more symptoms related to the liver disease, including encephalopathy. In July 2011, J.A.'s blood pressure became so low that he could not tolerate his medications; and, by August, his blood pressure medications had to be discontinued due his body's lack of tolerance. When Dr. Vermette was asked about plan of care reviews in the records for J.A. and whether those documents were inconsistent with a terminal prognosis of six months or less, Dr. Vermette testified that he focused his attention on the physician notes and nurse notes because those are notes that are being done, for the most part, at the bedside, in the presence of the patient, and the notes were a peer reviewers opinion of the patient at that point in time. In contrast, the plan of care reviews were produced as a result of discussing the case at an IDG meeting, with someone making notes of the comments that various people around the room were saying about the patient, and hoping to capture the discussion. Dr. Vermette pointed out that the plan of care reviews he was asked about contained a lot of information that corroborate J.A.'s terminal prognosis and condition, including shortness of breath on exertion, the extensive heart medications he was on, and dependent in 4 of 6 ADLs, which later worsened to 5 of 6 ADLs. Dr. Vermette testified that the plan of care reviews do not contradict the patient's eligibility for hospice. Dr. Eisner's testimony corroborated Dr. Vermette's that just prior to admission to hospice, J.A. suffered a cardiac event where his heart had stopped beating and he had an EF of 15 percent. Dr. Eisner further acknowledged that during J.A.'s stay in hospice, he lost 30 pounds of body weight, his dependency increased to 5 of 6 ADLs, his PPS score remained 40 percent, he had a decreased appetite and ambulation, had decreased tolerance to activity, had increased weakness, and was incontinent of bowel and bladder. AHCA has not met its burden by the greater weight of the evidence that J.A. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 12, N.D. Patient N.D. was an 87-year-old female, admitted to hospice with a terminal diagnosis of end-stage cerebrovascular disease. The claim period at issue is 11/07/09 to 02/24/12. At the time of admission, N.D. had had a history of strokes and her attending non-Vitas physician referred and certified her as hospice appropriate. N.D. had a history of cerebral vascular disease and extensive dementia as a result. At admission, she had a PPS of 30 percent, was completely bedbound, had a FAST score of 7d, was total care, and incontinent. The Appropriateness Evaluation notes show that N.D. was referred to hospice for weight loss and severe agitation. However, a psychosocial/spiritual note reflects that N.D. had previously been on services and was discharged for extended prognosis, and she was reported to be more confused and depressed according to her family. The Appropriateness Evaluation reported N.D.'s weight as 150 pounds, with a BMI of 25 according to chart and family, and no pressure ulcers or skin lesions. It reported the patient having recurrent infections over the last six months but no further information regarding the infections was included in the space provided on the form. The Appropriateness Evaluation finally indicated that N.D. was hypertensive with no other cardiovascular symptoms and indicated that she had no issues with the following systems: respiratory, genitourinary, gastrointestinal, neurological, HIV disease, debility, or adult failure to thrive. Vitas reported N.D. as having a history of CVA, but failed to reflect the number or dates of such occurrences. Dr. Talakkottur noted that there was no indication as to when the CVA occurred in the Appropriateness Evaluation, and there was nothing marked under the neurological section to reflect how that system had been impaired or to what degree. Under the section entitled stroke/coma, Dr. Talakkottur also noted that none of the pertinent assessments were checked for certifying that diagnosis. A physician, in his addendum to the initial certification, stated N.D. suffered a CVA, was hypertensive, diabetic and had been left weak with a poor caloric intake. However, there is no indication of the severity of her condition or notice as to when the CVA occurred in the physician's addendum. If anything, the file records demonstrate that the condition could have been ongoing for some time. Four years prior to the hospice stay at issue, N.D. was noted to be nonambulatory and bed and wheelchair bound. Dr. Talakkottur shed light on this issue and testified that the N.D.'s CVA or diagnosis of a CVA was recorded back in 2006. These facts and findings are further evidence in support of Dr. Talakkottur's testimony that patients who have strokes oftentimes have a chronic condition and can live for years. This patient's condition essentially remained stagnant. The medical file reflects that N.D. lived three years following her CVA before being admitted to hospice care during the disputed period. In N.D.'s 59 Plan of Care Review documents, her level of impairment was listed as one and two--mild to moderate except for seven occurrences where her gastrointestinal system was reported as a three (severe concern) for constipation (typically not a life-threatening condition). Her level of care and medication were not reported to have changed. While N.D. was reported at times to have dyspnea, the Plan of Care Reviews never reported dyspnea at rest. N.D. did not suffer from non-healing wounds or recurrent infection. The file did not show any recurrent infections, any aspirations, or any instances where the recipient was oriented times zero. Based upon the greater weight of evidence in this case, it is determined that this patient was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $126,209.70. Patient 14, M.G. Patient M.G. was an 83-year-old male, admitted to hospice with a terminal diagnosis of end-stage cerebrovascular disease. The claim period at issue is 09/01/09 to 07/14/10. At the beginning of the dates at issue, M.G. had comorbidities of vascular dementia, hypertension, and a history of aspiration pneumonia. He had a FAST of 7c, was dependent in 5 of 6 ADLs and had a PPS of 40 percent. During the first few weeks, the patient had significant pain, was having some shortness of breath with activity, was using oxygen, continued to have a 40 percent PPS, was bed to chair-bound and totally dependent on ADLs. Just getting from the bed to the chair required assistance. Dr. Vermette testified that the differences between 30 percent and 40 percent PPS in the patient at this point was moot because both of those scores describe a patient who is in a terminal phase of the disease process. The patient had increased weakness and worsening dysphagia. In October and November 2009, Patient M.G. had an episode of respiratory symptoms, a low-grade fever, a high respiratory rate, shortness of breath, rales, and was on oxygen. The patient was having excess secretions, cough and congestion, and began an inpatient level stay to manage those symptoms. According to Dr. Vermette, in a patient with dysphagia, secretions, cough, fever and congestion make up an aspiration event. Anytime food or secretion goes down the trachea and into the lungs, it causes congestion, causes a cough, can cause fever, and can become full-blown pneumonia. It can lead to airway compromise and death; there is no way of predicting when that event is going to happen. Through January 2010, M.G. had a PPS of 40 percent, a low FAST, and required assistance with 6 of 6 ADLs. He had an episode of chest pain, went to the hospital and was evaluated. He was recommended to have a cardiac catheterization, which he/his family refused to do. He did not appear to have had a heart attack, but the hospital believed he was at risk of a heart attack. Although it would have been M.G.'s right to have the catheterization and get that done outside the hospice benefit, he/his family refused, which demonstrated that he/his family recognized that he was not in any condition for an invasive procedure and they just wanted to keep him comfortable rather than pursue aggressive treatment. Through March of 2010, patient M.G. was bedbound, had dysphagia, aphasia, hemiplegia, and was at high risk for aspiration pneumonia and sudden death due to an aspiration attack. He had a FAST of 7d, a PPS of 40 percent, increased weakness, and decreased tolerance to activities. M.G. was not improving. He was, at best, staying the same and, at worst, declining. In May of 2010, M.G. had a PPS of 30 to 40 percent, dependent in 6 of 6 ADLs, incontinence, muscle wasting, and shortness of breath with minimal activity and at rest with chest pain off and on. M.G. qualified as a NYHA Class IV based upon the shortness of breath at rest and chest pain. M.G. had an albumin test in early June that came back in the normal range, at 4.5, which was high for the patient at that point. The patient was discharged in July 2010 for extended prognosis, before the patient was due for the next recertification. During the dates at issue, M.G.'s FAST level never improved to better than 7c, his PPS score never improved to greater than 40 percent and declined in March and June of 2010 to 30 percent, he was dependent for least 5 of 6 ADLs, and he had dysphagia. Dr. Talakkottur testified specifically that a patient with dysphagia is always at risk for aspiration. M.G. met the disease specific criteria from the LCD for dementia and related disorders. AHCA has not met its burden by the greater weight of the evidence that M.G. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 16, T.P. Patient T.P. was a 50-year-old female, admitted to hospice with a terminal diagnosis of advanced AIDS. The claim period at issue is 10/17/11 to 06/12/12. Just prior to her admission to Vitas, T.P. was hospitalized with an admitting diagnosis of advanced AIDS, an altered mental status, noncompliance and polysubstance abuse, and she was cachectic. The non-Vitas attending physician referred and certified the patient to hospice for end-stage AIDS. At initial certification, T.P. was mainly bedbound, had reduced oral intake, was total care, and her PPS was 40 percent. She only weighed 88 pounds, she had a significant amount of pain, rated as 7 of 10 pain after receiving pain medicine. She had comorbidities of cocaine use, kidney infections, latent syphilis, muscle wasting, shortness of breath with minimal exertion, and a UTI in the last six months. Dr. Eisner testified that between the dates of 10/17/11, and 06/12/12, T.P. had a continuous PPS of 40 percent, she was gaining weight, she was performing some of her ADLs and, as such, she was not an appropriate candidate for hospice. The Appropriateness Evaluation simply reported her date of diagnosis in the HIV Disease section but failed to give any other clinical evidence, such as the CD4 count, persistent elevated viral load, opportunistic infections or organ damage that would be related to HIV. The date of diagnosis was reported to be 2010 and the terminal diagnosis was reported to be AIDS. Dr. Eisner opined that T.P.'s condition while hospitalized--bedbound, requiring 100 percent dependence with ADLs, a PPS of 40 percent, dyspnea, lethargic, oriented to one, and incontinence of bowel and bladder--were conditions not related to her underlying HIV disease but instead were related to her drug abuse. Dr. Eisner testified that had it been her underlying end-stage HIV disease, T.P.'s condition would not have gotten better during her hospitalization. Dr. Eisner noted that the hospital did not find infection or organ damage that one would associate with someone who had end-stage AIDS. Laboratory data from while T.P. was in the hospital came back "essentially normal." Upon discharge from the hospital, the recipient was taken to Gramercy Park nursing home. Multiple face-to-face encounters were made between Vitas' physician(s) and T.P. at Gramercy Park nursing home. During many of those visits, she was reported to be alert, oriented, in no acute distress, denying pain except for one occasion, yet she could not rate or describe the pain. T.P. was also reported to ambulate mostly with a wheelchair, to have an adequate appetite, and to require some assistance with ADLs. During face-to-face encounters with Vitas' physician on 03/14/12, and 05/03/12, signs of weakness were noted but otherwise her condition was essentially the same as prior visits. Dr. Vermette agreed that Vitas' file lacked any CD4 count or viral load for this patient. Dr. Vermette nonetheless believed T.P. to be end-stage based upon a very low albumin level of 1.8 taken 10/09/11. T.P.'s albumin, however, was measured again on 04/17/12, and was 3.3, which is within the normal range. Dr. Vermette's opinion that T.P. was end-stage AIDS was also based upon a reported shortness of breath. Plan of Care Reviews, however, failed to report T.P. having dyspnea during the time in dispute. Quite the contrary, the plans often reported she had oxygen available to her on an as needed basis without reporting respiratory distress or shortness of breath. The lack of terminality is also supported by Vitas' signed recertification charts, all of which failed to report a single instance of non-healing wounds, recurrent infections, titrations in pain medications, or dyspnea during the dispute period. Based upon the greater weight of evidence in this case, it is determined that this recipient was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $40,711.85. Patient 17, Z.H. Patient Z.H. was a 63-year-old female admitted to hospice with a terminal diagnosis of end-stage heart disease. The claim period at issue is just over one month, from 09/01/09 to 10/06/09. Dr. Talakkottur testified that in a Plan of Care Review dated 09/12/09, covering the period 08/26/09 to 09/02/09, Z.H.'s PPS was reported as 60 percent, her weight was 85 pounds, and the recipient required assistance with 5 of 6 ADLs. No shortness of breath was indicated. Nursing notes prepared in the months of September (September 3, 10, 15, 22, 25 and 29) all reveal that a nurse assessed and reported no issues or concerns with Z.H.'s bodily systems and observed little to no pain. Little to no issues were reported again for the recipient's neurosensory system. Z.H. was reported oriented times two or three following 09/03/09, and there was but one occurrence on 09/25/09, where the nurse indicated some confusion and agitation but noted the recipient was oriented times two. There was never any indication of a problem or issue with this patient's cardiovascular system. With regard to Z.H.'s need for assistance with ADLs, a nurse reported in all but one note that the recipient required assistance in 3 of 6 (grooming and bathing) ADLs. On 09/10/09, the recipient was reported to require assistance in all ADLs without providing comment or evidence of change in the recipient's organ systems or pain level. Throughout the month of September 2009, oxygen was reported to be available as needed and there was no higher level of care administered to the recipient. Throughout the month of October, nurses similarly reported Z.H.'s condition as they did in September. She was oriented times two, no concerns, issues, or comments regarding the recipient's bodily systems or pain, and required assistance in 3 of 6 ADLs. Dr. Talakkottur testified that the patient did not have a terminal condition. Further, while physicians reported Z.H. to have cardiovascular problems in the recertification documents, there is no chest pain, no edema, no JVD, no dyspnea, no palpations, no arrhythmia, and no syncope reported. As such, Dr. Talakkottur testified he could not classify this patient as having a terminal condition related to heart disease. In support of the patient's eligibility for hospice, Dr. Vermette relied upon Z.H. having a comorbidity of ovarian cancer. Vitas initially admitted Z.H. to hospice with a terminal diagnosis of ovarian cancer. However, shortly after admission, a physician consult reported there was no evidence of metastatic ovarian cancer. Vitas changed Z.H.'s terminal diagnosis to heart disease, but continued to reflect upon the patient having a comorbidity of ovarian cancer in support of her hospice eligibility. On cross, Dr. Vermette testified that he did not review the entire file to determine Z.H.'s clinical status and relied upon the recertification note during the period in dispute. The medical records contained in this file do not support a finding that the Medicaid hospice eligibility standard was met during the disputed period. Based upon the greater weight of evidence in this case, it is determined that Z.H. was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $31,409.54. Patient 18, R.W. Patient R.W. was a 58-year-old male admitted to hospice with a terminal diagnosis of end-stage liver disease caused by alcoholic cirrhosis. The claim period at issue is 11/26/11 to 12/09/12. In the two months preceding the disputed period, R.W. had multiple open wounds on his legs, had evidence of persistent ascites, and had symptoms of hepatic encephalopathy. He also required two episodes of continuous care, one for change in mental status and the other for shortness of breath and anasarca. He suffered a fall the day before recertification for the dates at issue. In November 2011, R.W. was very lethargic, had a poor appetite, a decrease in verbal skills, respiratory distress with a rate of 24, and rhonchi with labored breathing. His ADLs varied between 5 of 6 and 6 of 6 due to his fluctuating encephalopathy. R.W. had comorbidities of cardiac disease, encephalopathy, and COPD. In early December 2011, R.W. had recurrent episodes of shortness of breath at rest and with exertion, which made him a NYHA Class IV. R.W. developed a respiratory infection with a moist productive cough and labored respirations. He was coughing up large amounts of yellow sputum and was placed on nebulizer treatments. He also began having tremors in his hands, known as asterixis, which Dr. Vermette stated was evidence of neurologic dysfunction caused by the ammonia and other toxins built up in the blood because of R.W.'s liver failure. R.W. also had episodes of apnea in December 2011. R.W. had anasarca, facial swelling, and tremors into January 2012, and he developed foul- smelling wounds on his legs. At the end of January 2012 and into February 2012, R.W. was on continuous care for a change in level of consciousness. He was dependent in 6 of 6 ADLs, PPS of 40 percent, and his abdomen was large. He had edema in all extremities and was weak and very lethargic. R.W. was placed on prednisone to help with breathing. In March 2012, R.W. had anasarca and significant lethargy. He spent most of his days slumped over in a wheelchair, and he was on oxygen most of the time. By May 2012, R.W. was on oxygen at three to four liters and exhibited shortness of breath. He developed edema with a swollen scrotal region, which Dr. Vermette stated occurs typically only in significant heart failure and liver failure patients. The time he spent in bed as opposed to a wheelchair had increased, as had his periods of lethargy and his ascites. He remained on lactulose for hepatic encephalopathy. He also had facial edema. In July 2012, R.W. was placed on methadone around the clock and Percocet as needed, especially before dressing changes. He also was no longer able to wheel himself in his wheelchair, which evidenced further functional decline. In September 2012, R.W. was having shortness of breath at rest and with activity, again demonstrating NYHA Class IV, which was evidence of end-stage liver disease according to Dr. Vermette. At the end of September and into early October 2012, R.W. was on continuous care for difficulty breathing, as well as a low-grade fever and change in level of consciousness. He developed respiratory distress, was having periods of apnea and was hypotensive. In the end of November 2012, R.W. was again on continuous care. He was lethargic and confused. His pain medications had increased again and he had diminished consciousness, hepatic encephalopathy, arrhythmia and respiratory distress with a high respiratory rate. He also had muscle wasting. R.W. was again on continuous care on 12/05/12. This was his third hospitalization-equivalent within the last 60 days. He was admitted for respiratory distress and he died on hospice service on 12/09/12. Dr. Talakkottur's rationale for his opinion that Patient R.W. was not Medicaid hospice was that lab work had not been done. However, lab work is rarely done in a hospice setting. Lab work is only done to adjust the patient's plan of care to better address his symptoms and keep him comfortable. Hospices do not take labs just to document a disease. Dr. Talakkottur used a visual aid that contained a list of symptoms that he believed should be present in an end-stage liver patient. Dr. Vermette opined that a patient with terminal cirrhosis of the liver would not have all of those symptoms. Dr. Vermette stated that the list appeared to simply be a list from a textbook of all symptoms that could possibly relate to liver disease of any sort. Most were not useful for prognostication whatsoever. Dr. Talakkottur reasoned that Patient R.W. was not hospice eligible because he did not have refractory ascites. Dr. Vermette stated this patient had ascites recurrently and frequently. Dr. Vermette also testified that in his experience working in and treating hospice patients, that the clear majority of end-stage liver patients on hospice do not receive repeated paracentesis because they do not tolerate them well. R.W. was on medication throughout his stay in hospice for his ascites. As part of Dr. Talakkottur's rationale for denying eligibility, he stated R.W. "did not show any signs of end-stage of his chronic disease." However, the LCD for liver disease specifically states that refractory ascites, alone, is evidence of the disease being end-stage. Dr. Talakkottur also reasoned that this patient was not hospice eligible because he did not have anasarca. Dr. Vermette noted that R.W. had severe edema, including edema of his face and scrotum, which was anasarca. Dr. Talakkottur also reasoned that R.W. was not hospice eligible because he did not have asterixis, which was directly refuted by the record. AHCA has not met its burden by the greater weight of the evidence that R.W. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 19, M.M. Patient M.M. was a 48-year-old male admitted to hospice with a terminal diagnosis of end-stage AIDS. The claim period at issue is just under eight months, 03/30/10 to 11/24/10. M.M. was admitted to an acute care hospital on 03/26/10 just prior to entering hospice with a history of fever, shaking, chills, and sweats, and he had a bacterial infection in his bloodstream of Enterobacter cloacae. He also had an infection in the wounds on his left leg of methicillin-resistant staph aureus ("MRSA"). He was anemic and was positive for cocaine and benzodiazepine. His CD4 count from the prior year was 70. M.M. was admitted directly from the hospital to hospice. At admission to hospice, M.M. was weak, bedbound, had dysphagia, was malnourished, severely immunocompromised, had failed treatment with antiretrovirals, had a PPS of 30 percent, and weighed 145 pounds, which indicated a five-pound loss from prior to admission. He had an ulcer on his left leg. M.M. was homeless, which according to Dr. Vermette impacted the patient's prognosis because he was not receiving adequate meals, shelter, and prior medical care. Dr. Vermette testified that the fact that the patient was homeless did not preclude him from being eligible for Medicaid hospice services, but made delivery of the services more challenging. In April 2010, M.M. was unable to ambulate and fell out of his wheelchair, further damaging the skin on his legs. M.M. did have improvement in his ADLs over the course of his stay in hospice, but he had a respiratory infection in July 2010 which required antibiotics and, by August 2010, had declined and was placed in a nursing home. His ADLs returned to 6 of 6 while in the nursing home. In September 2010, M.M. only had to be in the wheelchair for short intervals; however, he had muscle wasting at that time. On 09/14/10, M.M. was having generalized pain and shortness of breath with activity that required oxygen and occasional bronchodilators. He also had a respiratory infection and was incontinent. In November 2010, M.M. had a CD4 count of 29 from a prior level of 70. Dr. Talakkottur agreed that this lower CD4 count put the patient at higher risk for opportunistic infections. During the dates at issue, M.M.'s PPS increased to 40 percent, but decreased back to 30 by the fall of 2010. Dr. Vermette testified that M.M. had terminal AIDS because he was noted to have advanced HIV illness with wasting by the physician taking care of him in the hospital just prior to hospice admission. M.M. was also seen by an infectious disease expert who stated M.M. had advanced AIDS. M.M. was discharged from the hospital and referred to hospice by his doctors who stated that he had a poor prognosis and was hospice appropriate. Those doctors were not affiliated with Vitas. Dr. Vermette noted that although MRSA is not an opportunistic infection, it is a seriously harmful bacterium that is hard to eradicate even in a healthy patient with a normal immune system. Dr. Talakkottur believed, in part, that M.M. was not hospice appropriate because he did not have opportunistic infections. Dr. Vermette stated that Dr. Talakkottur did not properly take into account that an AIDS patient is usually not going to die from an opportunistic infection, and that most AIDS patients who die from an infection die from a regular infection that is more likely to kill an AIDS patient. M.M had two respiratory infections, a staph infection, and an infection in his blood. Any of those could be life-threatening to a healthy person, much less a person with AIDS. AHCA has not met its burden by the greater weight of the evidence that M.M. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 22, E.D. Patient E.D. was a 64-year-old male admitted to hospice with a terminal diagnosis of adult failure to thrive. The claim period at issue is eight months from 02/23/10 to 11/25/10. E.D. was hospitalized in February of 2010 prior to hospice admission with respiratory failure. He was intubated. He also had renal failure during the hospitalization and was diagnosed with a brain tumor. He was admitted directly from the hospital to Vitas. At admission to hospice, E.D. had a PPS of 20 percent, was 6 of 6 ADLs, had a BMI of 17.7, a Stage III ulcer on his hand, pulmonary edema, hypertension, a brain tumor, a PEG tube, and coronary artery disease. He was taking only minimal sips of fluid and had confusion. E.D.'s brain tumor was measured to be 4.9 by 4.9 centimeters, or about two inches in diameter. Shortly after admission to hospice, E.D. was placed in the IPU due to severe agitation. In March 2010, E.D. had an infection of his central line. He developed blood in his stool and had significant anemia and significant gastrointestinal bleeding with a hemoglobin of 9.6 and hematocrit of 29.6, which would have required a transfusion if E.D. was not in hospice. In May 2010, E.D. was transferred to the IPU unit because of aggressive behavior, including hitting caretakers. He continued to have wounds and significant functional and nutritional decline, as evidenced by a PPS that remained at 40 percent or less and a BMI that remained significantly below 20. In June 2010, E.D. had a low albumin of 2.93. He still had non-healing wounds and required another IPU stay for agitation and combativeness in late July 2010. All nonessential medications were stopped because of side effects, including agitation. He also had a UTI in the end of July. In August 2010, E.D. was having dark discoloration to his right foot, which was evidence of diabetic peripheral vascular disease. Dr. Vermette testified that this was a significant finding of progression of E.D.'s comorbidity of diabetes. In September 2010, E.D. had another UTI requiring antibiotics. In October 2010, E.D. had a respiratory infection with rhonchi, congestion, cough, and he was on respiratory nebulizer treatments. He still had a PEG tube for nutritional supplements. His ambulation was restricted from bed to wheelchair with assistance. He was on dexamethasone for intracranial swelling from the brain tumor and on seizure prophylaxes. In November 2010, E.D. developed respiratory distress with a respiratory rate of 38. He was placed on continuous care, became nonresponsive despite being on continuous care, and ultimately died on hospice care. Dr. Eisner opined that E.D. did not die because of his terminal illness; therefore, Dr. Eisner found E.D. ineligible for Medicaid hospice. Dr. Vermette testified that adult failure to thrive is a diagnosis that was, at the time of E.D.'s admission, one of the four most common diagnoses used in hospice nationwide. It was used for patients who had significant functional impairment, significant nutritional impairment, and was used for a patient who had multiple conditions that could result in his death. It is now called multiple morbidity. Dr. Vermette testified that typically a patient who has concurrent different illnesses is admitted for adult failure to thrive when they meet the criteria. All of E.D.'s comorbidities were part and parcel of the diagnosis of adult failure to thrive. The pneumonia or respiratory failure that he developed right before he died was extremely similar to the event that led to him being admitted to hospice. Dr. Eisner stated that E.D. did not have adult failure to thrive because he gained 12 pounds and, therefore, could not have nutritional impairment. Dr. Vermette testified that E.D.'s weight gain was not inconsistent with the terminal diagnosis and that factors, such as nutritional supplements, beginning to eat a soft diet, and use of the steroid dexamethasone, would cause a weight gain. Dr. Vermette noted that there was no indication that the weight gain coincided with increased muscle mass or strength. More importantly, the fact that the patient gained weight over the course of his stay in hospice could only be known at the end of the hospice stay and during a retrospective review. It could not be known when the initial certification was made on the date the patient was admitted with a BMI of 17. E.D. met the disease specific criteria from the LCD for failure to thrive. As noted above, he had a PPS of 40 percent or less, a BMI less than 22, and was not responding to nutritional support by way of his PEG tube at admission. AHCA has not met its burden by the greater weight of the evidence that M.M. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 23, J.L. Patient J.L. was a 59-year-old female admitted to hospice with a terminal diagnosis of end-stage COPD. The claim period at issue is just over four months, 03/14/11 to 07/27/11. J.L. was admitted to the hospital with an exacerbation of COPD on 03/09/11. She was found to have severe anemia during this stay and was treated by IV with hydration, antibiotics, and blood transfusions. At the time of admission to Vitas, J.L. had shortness of breath at exertion and at rest, was an aspiration risk, and had recurrent infections. Her PPS was 40 percent. She also had AIDS, acute renal failure, and a history of hepatitis. Her BMI was 19.9 and she had a glomerular filtration rate of 25 and an albumin of 2.5. She was immediately admitted to the IPU with shortness of breath, agitation, and altered mental status. In April 2011, J.L. was drinking heavily and was found vomiting after drinking, which put her at a risk of aspiration and affected her longevity. She had bitemporal wasting, which showed significant nutritional decline for a patient this young. Between admission and the end of June, J.L. had multiple hospitalizations for a viral illness, a UTI, and a psychiatric admission--she was hospitalized on 03/25/11, 05/16/11, and 06/17/11. In late June 2011, J.L. showed signs of improvement. She was dependent in 5 of 6 ADLs, but her PPS increased to 60 percent. She was still having shortness of breath, but it was intermittent as opposed to constant. She was still having agitation and gastrointestinal issues. Over the course of the next month, she stabilized enough to be discharged for extended prognosis. Dr. Vermette testified that J.L. followed the sawtooth pattern of decline. J.L. had a serious decline at admission and subsequently improved, but at the time of admission there was no way to know whether that decline was going to be the one that resulted in death or she would have a rebound in condition. When she rebounded enough to no longer support a prognosis of less than six months, she was appropriately discharged. Dr. Eisner noted in his review that J.L. was not hospice eligible because "she improved during her hospice admission." However, her improvement from her severe status exhibited at admission could not be realized until she was appropriately discharged at the end of the dates in dispute. AHCA has not met its burden by the greater weight of the evidence that J.L. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 24, F.F. Patient F.F. was an 84-year-old female, admitted to hospice with a terminal diagnosis of end-stage renal failure. The claim period at issue is just over four months, from 09/01/09 to 01/18/10. F.F. was referred to hospice for progressive decline in function. On her admission date, she was reported awake, alert, and oriented times two to three. In January 2009, a CT scan revealed that F.F. had a large renal cyst suggestive of Myeloma (a cancer of plasma cells in the bone marrow). Vitas admitted F.F. with a terminal diagnosis of end-stage chronic renal disease that had been diagnosed approximately four years earlier (2005). Evidence of F.F.'s renal disease was reported within the Appropriateness Evaluation's genitourinary section. One would therefore assume that Vitas would continue to track the status and/or progression of the disease under that system. Dr. Vermette, however, testified at the final hearing that end- stage renal disease did not produce genitourinary symptoms. End- stage renal disease caused symptoms systematically in other parts of the body because of the fact that the kidney's main function is to eliminate toxic metabolites from the body. When those toxins build up, they produce symptoms elsewhere in the body unrelated to genitourinary review of symptoms. A review of F.F.'s other systems reported in the Plan of Care Reviews suggest no terminal illness or progression of her renal disease. The Plan of Care Reviews reported no respiratory issues at all over the course of the disputed period. F.F. was reported to itch under the integumentary system. F.F. was neurologically sound. At best, she was reported to be forgetful at times, and her symptoms were reported mild from August through mid-October. Afterwards, Vitas failed to make further comment or score an impairment level for F.F.'s neurological system. The same was true for F.F's cardiovascular system except her impairment levels, when recorded between August and mid-October, fluctuated between mild and moderate. The plans reported no edema under cardiovascular. The plans reported F.F.'s musculoskeletal system to have a mild impairment level until 11/03/09, and thereafter, it went to moderate. As for her genitourinary system, there was no impairment level noted throughout the disputed period. Vitas also failed to report any concerns with F.F.'s genitourinary system in any nursing note, including the initial note prepared following admission (March 2009). Most nursing notes were checked that the genitourinary system had been "Assessed, no GU problems identified." The Plan of Care Reviews also fail to report F.F. enduring any pain above a mild impairment level. The only pain medication referred to in the plans is Tylenol 3 and it was used on an as needed basis. When marked in the Plan of Care Reviews, F.F.'s PPS was consistently 50 percent. F.F.'s weight was not always reported, despite the fact that she was ambulatory. However, when it was reported, the Plan of Care Reviews showed a steady increase. At admission she weighed 98 pounds, the first recorded weight in the Plan of Care Reviews was 100 and that was in October, and she was consistently reported to weigh 100 pounds until the latter part of December when her weight increased to 102 pounds and remained as such until the last Plan of Care Review in the disputed period. There were no labs to report F.F.'s albumin in the disputed period; however, labs were taken in October 2011, and it was reported at that time the recipient's albumin was 3.8 and 3.9 on 10/25/11 and 10/26/11. The medical records contained in this patient's file do not support a finding that the Medicaid hospice eligibility standard was met during the disputed period. Based upon the greater weight of evidence in this case, it is determined that F.F. was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $20,545.60. Patient 25, S.C. Patient S.C. was a 43-year-old female, admitted to hospice with a terminal diagnosis of end-stage SLE. The claim periods at issue are 02/02/12 to 02/24/12 and 05/14/12 to 12/31/12. SLE is an autoimmune disease where the body develops antibodies and attacks its own cells, damaging organ tissue all over the body. SLE can cause damage to the heart, to the lungs, to the liver, to the kidneys, and to the brain by damaging the blood vessels, leading to vasculitis. Most patients with SLE die from organ failure. In the time period leading up to the dates at issue, Patient S.C. was hospitalized with a stroke resulting from lupus. At the time of admission, she had a PPS of 30 percent, was drowsy, and required total care. Her family reported she had recently lost nine percent of her body weight. S.C. had significant comorbidities, including tuberculosis meningitis, four previous strokes, atrial fibrillation, and cardiac disease. She was an aspiration risk due to dementia and dysphagia. Her family sought hospice services. Patient S.C. met the criteria in the Florida Handbook at the beginning of the dates at issue because of her recent hospitalization with a stroke; the progression of her disease with multiple organs affected, including the brain, the heart, and immune system; nutritional decline; and significant functional impairment. During the first admission, Patient S.C. was on continuous care for numerous symptoms, including pain and respiratory symptoms. She came off continuous care but then was started on it again on 02/23/12, for agitation. Shortly thereafter, 911 was called, the patient was taken to the hospital, and hospice was revoked for aggressive treatment. At the time of her next admission beginning on 05/14/12, Patient S.C. had just been hospitalized again for altered mental status and possibly another stroke. The physician certification noted the patient was lethargic, had extensive evidence of disease, was bedbound, had reduced intake, required total care, had lost all intelligible vocabulary, was unable to sit independently, unable to smile, and unable to even hold her head up. Dr. Vermette testified that tuberculosis meningitis is a very rare condition. S.C. was exposed to tuberculosis while doing earthquake relief in Haiti about six months prior to her initial admission to hospice, which meant that, based on her status at admission to hospice, she had rapidly declined during those previous six months. With tuberculosis meningitis, instead of lodging in the lungs, it makes its way to the brain and affects the meninges. It is extremely difficult to treat. As of the initial certification on 05/14/12, Patient S.C. had a PPS of 30 percent, had a FAST of 7f, and had shortness of breath with minimal exertion. S.C. had contractures locking her limbs in a flexed position, as well as agitation and dysphagia. Her weight was 105 pounds, an additional 15-pound weight loss from the previous hospice admission three months earlier. S.C. showed evidence of progression of the terminal illness with worsening of the various organs that had been involved with lupus, further nutritional decline, and significant functional impairment. Over the next few months, S.C. continued to decline. She became aggressive and screamed when someone tried to bathe her, she tried to attack and claw nurse's aides, she began to develop skin breakdown on her ankle, and was only eating 30 percent of her pureed diet that had to be fed to her. S.C. was Medicaid hospice appropriate as of the recertification in August 2012. She had a fair appetite, was cachectic, had signs of muscle atrophy, needed total care, and had a PPS of 30 percent. In late August going into September, S.C. had fever and cough, and she was at increased risk of developing aspiration pneumonia. At the next recertification on 10/06/12, S.C. had to be fed, had an increasing appetite, and was eating 50 to 70 percent of her meals, but despite this, she was still very thin and cachectic. S.C. had atrophy of her leg muscles, so she was not able to stand on a scale. She was no longer able to tolerate being in a chair, even with a lift, so she was completely bedbound all the time. S.C. was recertified a final time during the period in dispute on 11/26/12. At that point, S.C. demonstrated functional decline, anorexia and weight loss, dysphagia, cardiac involvement of lupus, and had oral thrush, which further indicated the decline of her immune system and susceptibility to an infection. Following that recertification, S.C. continued to show evidence of significant decline. She developed a lung infection that required bronchodilators in the form of nebulizer treatments and antibiotics and had a fever of 102, which continued until 12/20/12. Whether S.C.'s PPS score was less than 30 percent, or whether it was 20 or 40 percent, did not change her eligibility for Medicaid hospice. Any number of 50 percent or less would have shown functional impairment to meet the expected functional decline. A PPS of 50 percent is generally considered compatible with a prognosis of six months or less in non-cancer hospice diagnoses. Even when a nurse note did not calculate a PPS number, they indicated the patient required total care, was bedbound, or was able to get in a wheelchair only with a Hoyer lift. Consequently, the description of the patient in the notes described the criteria that a physician would use to infer a PPS of 30 or 40 percent at any given time. There was no description of S.C. in the medical records that would lead to a PPS of 50 percent or greater. Dr. Vermette testified that once S.C. began developing cachexia and had a level of terminality to her disease process, she reached a tipping point at which even with good nutrition, she could not gain weight because her body was no longer capable of reversing the process. Where the records showed S.C. did eat 100 percent of her meal, she did not feed it to herself. She needed assistance with eating at those times. She was total care at those points and she was bedbound. Dr. Talakkottur testified that at the second admission, 05/14/12, Patient S.C. had been hospitalized for agitation and nasal bleeding, she had a PPS score of less than 30 percent, she was bedbound and had a FAST level of 7f, and she continued to be dependent in 6 of 6 ADLs. Dr. Talakkottur further testified that patient S.C.'s PPS score never rose above 40 percent, her FAST level never improved to better than 7c, and she was nonambulatory and incontinent during her entire length of stay. AHCA has not met its burden by the greater weight of the evidence that S.C. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 26, D.A. Patient D.A. was a 61-year-old female, admitted to hospice with a terminal diagnosis of end-stage cerebral degeneration. The claim period at issue is 10/17/11 to 12/31/12. At the time of admission, Patient D.A. had end-stage dementia. In addition, she had recurrent UTIs and had been hospitalized a little over a month prior to hospice admission with a serious UTI. D.A. also had hyperglycemia and had a malignant melanoma Stage IV on her leg. A Stage IV melanoma, by definition, means that it is in the bloodstream waiting to settle. D.A.'s secondary conditions due to her dementia included severe cognitive impairment, functional impairment, incontinent of bowel and bladder, FAST of 7d, PPS of 30 percent, bedbound, reduced intake, dysphagia, and dependent in 6 of 6 ADLs. Patient D.A. met the criteria for Medicaid hospice eligibility in the Florida Handbook at the beginning of the dates at issue because of her status at admission and terminal diagnosis, clear evidence that she had reached the terminal stage of her illness, a recent hospitalization, significant functional decline, and significant evidence of nutritional impairment. Dr. Vermette testified that the indicators of end-stage cerebral degeneration include a FAST of 7a or above and secondary or comorbid conditions which are significant and contribute to prognosis. D.A. portrayed these indicators by having a FAST of 7c or above throughout the dates at issue, a known malignancy that has a poor prognosis in general, significant dysphagia which puts the patient at high risk of aspiration--the most common cause of death in dementia patients. She continued to be severely declined, she remained bedbound during the entire period, and she had signs of decline throughout her course of her care. At the beginning of the dates at issue, D.A. had a pressure ulcer to her left foot that eventually resolved. However, she quickly developed another wound on her upper thigh. D.A. developed dyspnea on exertion, such as while trying to roll over in bed and trying to eat, even though she was bedbound. There were very few actions D.A. could perform at that point. Shortness of breath while rolling over or eating was significant and showed an aspect of respiratory involvement in her disease. In December 2011, D.A. developed tremors in her hands, which was a sign of further disease progression of D.A.'s end-stage cerebral degeneration. D.A. also had hydrocephalus, which means that the areas in her brain that are normally filled with fluid had expanded. This was evidence that she lost brain tissue. In May of 2012, D.A. required an IPU stay because of shortness of breath and vomiting, which was life-threatening because of D.A.'s dysphagia and aspiration risk. While she was in the IPU, she weighed 165 pounds, which was a five-pound weight loss. In July 2012, she was coughing more frequently while trying to eat, which was evidence of worsening dysphagia and increased risk of aspiration. In September 2012, she developed another wound on her elbow. In October of 2012, she had developed contractures, so her fingers were curling up on themselves and the pressure of one finger pushing against the skin of another finger caused wounds. This was a sign of further progression of her terminal disease of cerebral degeneration. At the end of the dates at issue, D.A. was in the IPU again for shortness of breath and fever, which could lead to an aspiration pneumonia. She was started on antibiotics during the last few days of December 2012. Dr. Vermette testified that the only improvement in D.A.'s condition during the dates at issue was that, except for the elbow wound that began in October 2012, her numerous wounds did eventually heal, albeit at a delayed pace. However, whether or when a wound resolves cannot be known at the time it occurs. In December 2012, D.A. developed decorticate posturing, which means that D.A.'s brain had declined to the point where her arms were stiffly held out at the sides with the palms up and were immobile. Decorticate posturing is incompatible with having tremors and is a worse decline than tremors. Patient D.A. had aspiration events when she was having shortness of breath, and coughing and choking while eating, even though such events did not end up leading to pneumonia. When asked whether a patient was hospice appropriate that had a PPS score of 30 percent, was bedbound, required assistance with 6 of 6 ADLs, was confused, had reduced intake, was unable to sit up on her own, was not ambulatory, was incontinent of bowel and bladder, and had a history of melanoma, hydrocephalus, diabetes, obesity and arterial hypertension, Dr. Talakkottur would not answer yes or no and was unpersuasive. D.A. met the disease specific criteria from the LCD for dementia and related disorders. As noted above, she had a FAST score of at least 7c, which indicates she was speaking six words or fewer, was dependent in 6 of 6 ADLs, and was incontinent. AHCA has not met its burden by the greater weight of the evidence that D.A. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 28, N.M. Patient N.M. was a 57-year-old female, admitted to hospice with a terminal diagnosis of end-stage heart disease. The claim period at issue is less than one year, from 05/25/11 to 04/06/12. N.M. had a long history of heart disease, as well as stroke. She was admitted to the hospital approximately six months prior to her hospice admission in November 2010 and was diagnosed with cardiogenic shock, as well as coronary artery disease and carotid stenosis. Cardiogenic shock means the heart has such an insult that it becomes stunned for a period of time and the blood pressure rapidly drops. The patient usually ends up on multiple medications in an attempt to keep the blood pressure high enough to stay alive. N.M. was hospitalized again on 05/20/11, approximately five days prior to her hospice admission, for an acute decompensation of congestive heart failure. N.M. was having orthopnea (shortness of breath lying down) and had progressive shortness of breath, but was not a candidate for bypass surgery or other modalities that would have corrected her issues because of her multiple comorbidities. N.M.'s comorbidities included a previous stroke, obesity, diabetes, hypertension, and carotid stenosis. During the 05/20/11, hospitalization, Patient N.M. was found to have an EF of 45 percent, which was between normal and abnormal. She also had a pulmonary artery pressure of 57 with moderate to severe mitral regurgitation. Normal is only 8 to 25, making this finding more significant to her prognosis than the EF. N.M. was referred to and admitted directly to hospice from the hospital. She was unable to do any work, she was mainly sitting and lying, she needed assistance with care, and her weight was 183 with a BMI of 36, which was in the obese range. She had shortness of breath, or dyspnea, at rest and with exertion, NYHA Class IV. She had residual issues from her prior stroke, including muscle weakness on the left side. She was immediately admitted to a higher level of hospice care. Patient N.M. met the criteria for Medicaid hospice eligibility at the beginning of the dates at issue because she had evidence of terminal diagnosis with a life expectancy of six months or less, she had multiple hospitalizations, and she had multiple physician assessments and radiologic assessments. N.M. further had progression of the disease, declining functional status with a PPS of 40 percent. She had gone from chronic heart disease to end-stage heart disease. In August 2011, N.M. had signs of muscle atrophy and wasting, she remained bedbound, and she had a skin abscess in her axilla, or armpit, in the previous month. She remained a NYHA Class IV, and she was on six medications to try to control her cardiac symptoms. N.M. was also on oxygen 24 hours a day and had nitroglycerin tablets for when she had chest pains. Between August and November of 2011, N.M. had another abscess under her arm and she continued to have shortness of breath at rest and was NYHA Class IV. In November 2011, N.M. continued to have an abscess, needed extensive care, and had a PPS of 40 percent. In January 2012, N.M. had yet another skin infection. She required multiple doses of sublingual nitroglycerin and she required oxygen continuously. Her PPS was down to 30 percent. She needed extensive assistance and she had another UTI in addition to the abscess. N.M. had shortness of breath at rest and she became incontinent and was wearing diapers. In February 2012, N.M. was having continuous episodes of chest pain and shortness of breath at rest. In March 2012, she had more episodes of abscesses in her sweat glands and axilla which had become a recurrent infection. She had increased episodes of pain, which required more doses of pain medication. She was having more psychosocial symptoms, anxiety and depression, because of her symptoms related to her end-stage heart disease and medication was started for those symptoms. She continued to be a NYHA Class IV and continued to need oxygen 24 hours a day. N.M. was appropriately recertified for Medicaid hospice at each point in time and had evidence of a prognosis of six months or less at each point in time. On 04/06/12, N.M. had a worsening of her symptoms, and her family called 911. She went to the hospital and revoked hospice and was admitted to the hospital with decompensating symptoms. N.M. did not have any significant improvement during the dates at issue. Even though the EF found on the echocardiogram at the time N.M. revoked hospice showed some improvement, other issues on the echocardiogram showed the patient remained Medicaid hospice eligible, such as pericardial effusion more related to her intrinsic heart disease than to heart failure per se. She also had evidence of valve disease and inoperable multivessel coronary artery disease. Although there were a few nursing notes in N.M.'s records where the orthopnea box was not checked, the nurses frequently noted the patient had dyspnea, and that the patient was bedbound or lying in bed, which is the definition of orthopnea. AHCA has not met its burden by the greater weight of the evidence that N.M. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 29, V.R. Patient V.R. was a 56-year-old female, admitted to hospice with a terminal diagnosis of end-stage cirrhosis of the liver. The claim period at issue is just over seven months, from 04/05/12 to 11/20/12. Rather than being referred to hospice from a hospital admission, V.R. was referred to hospice by her primary care physician. Dr. Eisner testified that V.R.'s liver disease was related to her chronic Hepatitis C. V.R. had suffered from liver disease since 1998. During the disputed period, Dr. Eisner opined that V.R. had a life expectancy of greater than six months because the file did not contain evidence to show her cirrhosis was progressing and her functional status did not change. Although she suffered from ascites, it did not worsen to the point of requiring a paracentesis. Dr. Vermette noted V.R. had a "declining functional status, including a PPS of 40 percent." However, her PPS score was 40 percent on admission and remained static at 40 percent until 09/20/12, when it rose to 50 percent. Dr. Vermette admitted that the most common markers for liver functionality are albumin scores and INR scores, which are assessed through a blood test. Vitas' training document, created by Dr. Shega, states that a patient must have an INR of greater than 1.5 and an albumin score of less than 2.5 AND other evidence of end-stage liver disease, such as ascites or encephalopathy. Dr. Vermette admitted that no blood tests were performed for V.R. during the disputed period. Therefore, V.R. did not have lab values which would lead a physician to conclude she had a life expectancy of less than six months. The medical records contained in this patient's file do not support a finding that the Medicaid hospice eligibility standard was met during the disputed period. Based upon the greater weight of evidence in this case, it is determined that V.R. was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $35,999.98. Patient 30, J.A. Patient J.A. was an 86-year-old male admitted to hospice with a terminal diagnosis of debility unspecified. The claim period at issue is less than one year, from 10/29/09 to 09/29/10. Patient J.A. was transferred to Vitas from a different hospice at the beginning of the dates at issue. The medical director from the prior hospice believed J.A. was still hospice eligible at the time of transfer and noted that J.A. had an increase in healthcare utilization as well as a fall causing a head injury. At admission to Vitas, J.A. had underlying organ systems insufficiency with significant cognitive and nutritional impairment, was dependent in 6 of 6 ADLs, and required maximum assistance in going from bed to chair. He had dysphagia with micro aspirations, end-stage dementia with a FAST greater than 7, lung disease which required nebulizers frequently, coronary artery disease, and his PPS was 40 percent. On 11/02/09, Patient J.A. was on a pureed diet and was using oxygen and bronchodilators for cough, congestion, and agitation. He had a recent respiratory infection requiring antibiotics. His FAST score was 7c, he was dependent in 6 of 6 ADLs, and he had a PPS of 40 percent. He required a Velcro support to keep him from falling out of his wheelchair. By December 2009, J.A. had lost a pound and a half more weight. He had another fall later that month, hit his head, and required a skull X-ray. In January 2010, J.A.'s PPS decreased to 30 percent while his FAST remained in the terminal stage. In April 2010, J.A.'s weight decreased to 123 pounds. He had chest congestion requiring nebulizer treatment, increased weakness, dysphagia, and needed to be fed. In June 2010, J.A. was incoherent in speech and his FAST score was 7c to 7d. His weight was between 122 and 123 pounds, he had decreased tolerance to activity and sitting in a wheelchair, he had increased weakness and confusion, and he remained on a pureed diet due to the risk of aspiration. In August 2010, J.A. had shortness of breath and chest congestion intermittently, increased weakness and agitation, and restlessness. He was dependent in 6 of 6 ADLs, had further decreased tolerance to sitting in a chair and increased mental confusion. On 09/27/10, Patient J.A. developed a sudden change in level of consciousness and respiratory distress. He was placed on continuous care and over the next two days, he had very rapid breathing and respiratory distress with a respiratory rate as high as 42. His skin became mottled as he was getting less oxygen to the tissues. He had apnea spells and ultimately died of respiratory distress on 09/29/10. Dr. Eisner testified that J.A. did not exhibit functional decline over the dates at issue. Dr. Vermette explained that this patient was dependent in 6 of 6 ADLs at admission requiring maximum assistance so there was no way to decline in functional status, although he did exhibit decline in his inability to tolerate just sitting in a chair. Dr. Eisner also stated that J.A.'s weight had been stable at admission at 128 pounds. However, J.A.'s weight declined by ten pounds in the months leading up to admission. AHCA has not met its burden by the greater weight of the evidence that J.A. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 31, A.J.M. Patient A.J.M. was a 77-year-old female admitted to hospice with a terminal diagnosis of end-stage heart disease. The three claim periods at issue total about six months: 03/13/12 to 03/15/12; 03/20/12 to 03/24/12; and 03/30/12 to 09/28/12. A.J.M. had a history of heart disease which required a defibrillator be placed three years prior to admission at Vitas. She was hospitalized in the days leading up to the first claim period with significant heart failure, diastolic dysfunction, and an EF of only 10 percent. She also had severe global hypokinesis of the left ventricle, which means heart tissue had died so the heart beat in an abnormal pattern with less strength than normal. A.J.M. was admitted directly from the hospital to Vitas. On admission on 03/13/12, A.J.M. had a PPS of 30 percent, was bedbound, had reduced intake, was NYHA Class IV, and had leg edema. She also had comorbidities of recurrent pneumonias and dementia. She was dependent in 6 of 6 ADLs. A.J.M. revoked hospice care less than three days after admission on 03/15/12. A.J.M. returned to the hospital on 03/16/12. She presented to the ER with a hypertensive emergency and pulmonary edema. Her EF was 10 percent. She was intubated during this hospitalization and her blood gas was monitored. A.J.M. was immediately readmitted to Vitas hospice from this hospitalization on 03/20/12. At this admission, she had a PPS of 30 percent, was total care, still had reduced intake, had edema in both legs, was short of breath at rest, and had a wound on her sacrum. More history was noted including that the patient had pneumonia and UTIs in the last six months. Given the hospitalization with respiratory failure requiring intubation between the first and second period, this patient's terminal prognosis had worsened since the initial admission to hospice. During the second admission, A.J.M. had chest pains which required nitroglycerin. Vitas was arranging to transfer A.J.M. to the IPU for pain management when her family instead elected to seek aggressive treatment in the hospital and revoked hospice care again on 03/24/12. Patient A.J.M. was again admitted to Vitas directly from a hospitalization on 03/30/12. On admission, A.J.M. had a PPS of 30 percent, shortness of breath, an EF of 10 percent, a FAST score of worse than 7, diabetes, anemia, and dysphagia. A.J.M.'s weight had decreased to 130 pounds and she was experiencing chest pains. In April 2012, A.J.M. required an IPU stay for shortness of breath and had chest pain which was treated with nitroglycerin. A.J.M. received four bursts of defibrillation because she had three episodes of ventricular tachycardia and one episode of ventricular fibrillation, requiring the automatic device to shock her. On 05/06/12, Patient A.J.M. required a stay in the IPU for chest pains. Her respiratory rate was high and she was tachycardic. A.J.M. was in significant distress at this time. On 05/21/12, A.J.M. again required care in the IPU, this time for a change in level of consciousness. She was hypotensive, and as a result, some of her blood pressure medications were withheld. On 06/22/12, A.J.M. again required IPU care due to pain and respiratory distress. Her weight decreased to 122 pounds. On 09/14/12, Patient A.J.M. had significant respiratory and cardiac symptoms, increased weakness, and muscle wasting. On 09/24/12, she again was transferred to the IPU for change in level consciousness and agitation. She was in respiratory distress with a respiratory rate of 26, was becoming more delirious, and experienced more shortness of breath. A.J.M. died on hospice care on 09/28/12. Dr. Vermette opined that each of the IPU stays would have resulted in another hospitalization if A.J.M. had not been on hospice at the time. Dr. Vermette also opined that this patient died of end-stage heart disease or end-stage congestive heart failure with respiratory arrest. Dr. Talakkottur stated A.J.M. was not hospice eligible because she did not have significant respiratory or cardiac symptoms, had no frequent hospitalizations, and had no recurrent infections. These statements are directly contrary to the evidence. A.J.M. was noted to have recurrent UTIs and pneumonia within the six months prior to hospice admission. She had three hospitalizations in March 2012 due to her cardiac and respiratory distress along with five other IPU stays. Dr. Talakkottur also stated that A.J.M.'s nutritional status was not compromised despite a decrease in weight from 175 pounds to 122 pounds from the time of initial admission until the patient's death. AHCA has not met its burden by the greater weight of the evidence that A.J.M. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 33, M.V. Patient M.V. was an 89-year-old female admitted to hospice with a terminal diagnosis of end-stage cardiovascular disease and also exhibited symptoms of end-stage cerebral degeneration. The claim period at issue is 12/14/10 to 03/25/12. On recertification for the period beginning 12/14/10, M.V. had shortness of breath, a PPS of 30 percent, was dependent in 6 of 6 ADLs, a comorbidity of end-stage dementia with a FAST of 7d, and had dysphagia which required a pureed diet, as well as the Thick-It compound added to her fluids. M.V. remained 6 of 6 ADLs during the dates in dispute with a PPS of 30 percent. In April 2011, M.V. suffered a respiratory infection requiring antibiotics. In June 2011, she had visible signs of cachexia and muscle wasting. On 08/12/11, M.V. had a significant infection. Similarly, on 08/25/11, M.V. had congestion, shortness of breath, cough, and secretions, which was consistent with an aspiration event in a patient such as this with severe dementia and dysphagia. On 08/31/11, M.V. required a suction machine to help with the secretions. In October 2011, Patient M.V. became hypotensive and had another upper respiratory infection. M.V. continued to experience brachycardia and hypotension in December 2011. Her FAST score also worsened to 7e. Dr. Talakkottur agreed that this progression of M.V.'s FAST score would be consistent with her comorbidity of Alzheimer's disease. On 03/23/12, Patient M.V. developed acute respiratory distress with a respiratory rate of 24. She had cyanosis and was placed on continuous care for respiratory distress. M.V. died on hospice services on 03/25/12. Dr. Vermette testified that each of M.V.'s episodes of infection where she developed respiratory distress and developed cough, congestion, and required antibiotics were likely aspiration events. As noted from the Mitchell study, an episode of pneumonia in the presence of advanced dementia results in a grave prognosis. Patient M.V. had three episodes of significant respiratory distress, the last one of which ended up killing her, and either of the other two could have done so. Dr. Talakkottur stated this patient was not hospice eligible because she did not have recurrent infections. However, the record shows that M.V. had three respiratory infections within a year. Dr. Talakkottur stated that this patient had a hip fracture but that such an injury would have no impact on her prognosis. This is directly refuted by the credible testimony of Dr. Shega in prior claims. Dr. Talakkottur admitted that the medical record on 03/25/12 immediately preceding M.V.'s death evidenced that M.V.'s life expectancy at that point was less than six months. According to the audit instructions, if any day during a certification period was approved by a peer reviewer, then the entire certification period was to be approved. Dr. Talakkottur agreed that M.V. was hospice appropriate on 03/25/12; accordingly, that entire period must be approved for reason of the instruction alone. AHCA has not met its burden by the greater weight of the evidence that M.V. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 34, L.S.L. Patient L.S.L. was an 85-year-old male admitted to hospice with a terminal diagnosis of end-stage cerebral vascular disease. The claim period at issue is 12/03/10 to 09/28/11. In 2008, L.S.L. suffered a significant stroke. Over time, he became increasingly debilitated. He was hospitalized prior to admission to repair and replace his PEG tube, but was noted by his daughter to have declined since that hospitalization, including that he required a Foley catheter. At the time of admission, he required a PEG tube for his feedings, had developed vascular dementia and was nonverbal. He had problems swallowing and had dysphagia. He had a seizure disorder and was on seizure medications. The medical records indicate that this patient was admitted to hospice for "agitation." Dr. Vermette testified that he thought it was "very likely" that the agitation experienced by L.S.L. was associated with the PEG tube reinsertion and Foley catheter insertion. Dr. Eisner opined that although L.S.L. was sick on presentation, it was the result of his stroke in 2008. He showed no change in his cerebral vascular disease and no progressive decline in his functional or nutritional status. Besides one brief inpatient overnight stay in June of 2011 to service his PEG tube, L.S.L. lived at home with his daughter. His daughter was a nurse who described herself as having experience working around patients like her father. In July 2011, a social worker noted the daughter stated her father was doing well, and he seemed like a chronic patient and had not declined since admission. The medical records show that discharge planning was discussed with L.S.L.'s daughter as early as 06/29/11; however, he was not discharged until 09/28/11, for extended prognosis. The medical records contained in this patient's file do not support a finding that the Medicaid hospice eligibility standard was met during the disputed period. Based upon the greater weight of evidence in this case, it is determined that L.S.L. was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $46,830.90. Patient 35, R.B. Patient R.B. was a 52-year-old male admitted to hospice with a terminal diagnosis of end-stage AIDS. The claim period at issue is just two weeks, from 01/14/11 to 01/28/11. R.B. was admitted to the hospital with pneumonia just prior to his hospice admission. The chest x-ray from that admission was consistent with pneumocystis carinii pneumonia ("PCP"), which is one of the defining opportunistic infections in AIDS patients. Patient R.B. was admitted to hospice directly from that hospitalization. He had a combined CD3 CD4 count of 88. At admission, R.B. had a PPS of 30 percent, was drowsy, was dependent in 6 of 6 ADLs, had weight loss from 125 to 110 pounds in the prior three months, and had a BMI of 18. In addition to AIDS, R.B. had thrush, a history of AIDS wasting, systemic lymphoma, non-small cell lung cancer, and COPD. He was placed in IPU for shortness of breath upon admission to hospice. He was also agitated and restless during that time. R.B. was going to be placed in a nursing home because he was homeless, but when the transfer to the nursing home was scheduled to occur, he became angry and belligerent and revoked hospice care. On the date R.B. revoked, his ADLs had improved to needing assistance with 1 of 6. However, Dr. Vermette stated it is not uncommon for a patient to show improvement in the first weeks after admission to hospice from an acute hospitalization. Dr. Vermette also stated that a combined CD3 CD4 count is very similar to a CD4 count. He stated a combined CD3 CD4 count below 200 would be AIDS-defining. During the dates at issue, R.B. required antipsychotic medications. He was also treated with oxygen and nebulizer treatments every four hours. He required two different narcotics for pain. Dr. Eisner found no evidence of decline during the two weeks R.B. was in hospice. However, this again shows the problematic nature of the retrospective review and does not take into account that at admission, this patient was hospice eligible. AHCA has not met its burden by the greater weight of the evidence that R.B. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment. Patient 36, J.D. Patient J.D. was a 79-year-old male, admitted to hospice with a terminal diagnosis of end-stage heart disease. The claim period at issue is just under six months, from 10/21/10 to 04/18/11. Leading up to and at the beginning of the dates at issue, Patient J.D. had been hospitalized because of gangrene in one of his legs, requiring amputation. He was referred to hospice from that hospitalization. In addition to his obvious peripheral vascular disease and anemia, J.D. had a history of stroke and dementia and a comorbidity of hypertension. He had a PPS of 30 percent, was bedbound, disoriented at times and required total care, had shortness of breath at rest and required frequent oxygen. J.D. was also having episodes of chest pain and having episodes of edema in his lower extremity. J.D. had experienced a MI (heart attack) ten years prior to admission to hospice. At admission the recipient's EF was 45 percent. Notably, J.D. was not suffering from shortness of breath or requiring oxygen after admission to hospice care. Moreover, starting with the nursing assessment on 11/16/10, Dr. Talakkottur noted that the nurses' notes fail to evidence anything of significance for either the cardiovascular or respiratory systems of J.D. which would lead him to believe J.D. had a prognosis of six months or less to live. Dr. Vermette opined that J.D. was hospice eligible because of his recent hospitalization and the progression of his terminal illness, specifically that he was a NYHA Class IV. However, in addition to the nurses' notes discussed during Dr. Talakkottur's testimony, the Plan of Care Reviews failed to report this recipient suffered from dyspnea at any time from admission until 04/12/11. Moreover, Dr. Vermette admitted that Respondent conceded a portion of J.D.'s hospice stay based upon concerns that certain Plan of Care Reviews had been merely photocopied with dates changed. Based upon the greater weight of evidence in this case, it is determined that this recipient was not eligible for Medicaid hospice services and that AHCA is entitled to recover an overpayment of $148,606.85. Patient 38, L.F.P. Patient L.F.P. was an 83-year-old female, admitted to hospice with a terminal diagnosis of end-stage Alzheimer's disease. The claim period at issue is just over four months, from 08/09/12 to 12/31/12. In July 2012, L.F.P. was a FAST of 7c to 7d, dependent in 6 of 6 ADLs, PPS of 30 percent, had muscle wasting, decreased oral intake, was having episodes of agitation, and had a recent UTI. Following that recertification, a week prior to the beginning of the denied period, L.F.P. was placed on continuous care because of a change of mental status with significant lethargy and she was also dehydrated and having shortness of breath. On the first day of the denied period, L.F.P. developed a tremor possibly due to medications. L.F.P. then had improvement since the continuous care began and was more awake and alert. Her altered mental status appeared to be improving. Patient L.F.P. displayed the indicators for end-stage Alzheimer's, such as high FAST score, functional impairment, nutritional impairment, and other comorbidities or secondary symptom burden. Dr. Vermette testified that L.F.P. was appropriate for Medicaid hospice at the beginning of the dates at issue because the factors that were present when the patient was appropriately recertified on 07/08/12 were still present one month later, and indeed the patient had shown a need for significantly more care during those two weeks just prior to the beginning of the denied period. Because the first month of the recertification period was approved, the second month, including the beginning of the denied period, must be approved in accordance with the audit instructions. In August 2012, L.F.P. developed blood in her urine and a UTI, requiring an antibiotic. In September 2012, L.F.P. developed a wound in the sacral region and it was a Stage II, over an inch in diameter in all directions. While a patient does not die specifically from a skin wound of this size, he/she can develop an infection which then can debilitate a patient such as this and lead to sepsis and ultimately death from the infection. More commonly, this type of a wound is a marker of nutritional impairment and a general functional decline. In October 2012, L.F.P. remained FAST 7d and remained bedbound, total care. The prior wound healed in October; however, later in the month and early November, she developed a new wound in that area. L.F.P. developed contractures, her muscles tightened up because of disuse and caused her joints to flex and be locked in that position. L.F.P. began receiving baclofen to help with her contractures. L.F.P. was also at risk for aspiration and was on aspiration precautions, requiring a pureed diet and thickened liquids. In December 2012, Patient L.F.P. had a FAST score of 7d, a PPS of 30 percent, dysphagia requiring a pureed diet with thickened liquids, still had contractures, and she had a sacral wound. Additionally, she had shortness of breath at rest, which was an additional symptom burden and additional organ system involvement in her symptom burden. L.F.P. displayed the indicators of end-stage Alzheimer's disease throughout the dates at issue. Dr. Talakkottur confirmed that throughout the dates at issue, L.F.P. was incontinent of bowel and bladder, her PPS score never ranged above 30 percent, her FAST level was never better than 7d, and she was dependent in 6 of 6 ADLs. AHCA has not met its burden by the greater weight of the evidence that L.F.P. was not eligible for Medicaid hospice services, and it is not entitled to recover an overpayment.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Agency for Health Care Administration enter a final order directing VITAS Healthcare Corporation of Florida to repay an overpayment to AHCA the sum of $954,488.60, plus the overpayments to be recalculated for Melbourne Patients 11 and 21, and Boynton Beach Patient 5. The undersigned reserves jurisdiction to the extent AHCA provides the revised sanctions, fines, and costs it is entitled to recover against VITAS and that amount is determined in a later proceeding. DONE AND ENTERED this 28th day of September, 2018, 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 28th day of September, 2018.
The Issue Whether the Certificate of Need (CON) applications filed by Odyssey Healthcare of Collier County, Inc., d/b/a Odyssey Healthcare of Northwest Florida, Inc. (Odyssey), and HPH South, Inc. (HPH), for a new hospice program in the Agency for Health Care Administration (AHCA or the Agency) Service Area 5B, satisfy, on balance, the applicable statutory and rule review criteria to warrant approval; and whether such applications establish a need for a new hospice based on special circumstances, and, if so, which of the two applications best meets the applicable criteria for approval. Holding: Neither applicant proved the existence of special circumstances warranting approval of an additional hospice program in Service Area 5B. Although neither application is recommended for approval in this Recommended Order, both applicants, on balance, satisfy the applicable statutory and rule criteria. Of the two, HPH best satisfies the criteria.
Findings Of Fact The Parties AHCA The Agency for Health Care Administration is the state agency authorized to evaluate and render final determinations on CON applications pursuant to Subsection 408.034(1), Florida Statutes. HPH HPH is a newly created not-for-profit corporation formed to initiate hospice services in Pinellas County. HPH is a wholly-owned subsidiary of Hernando-Pasco Hospice, Inc., d/b/a HPH Hospice and is one of the oldest, not-for-profit community hospices in Florida. HPH Hospice was incorporated in 1982 to serve terminally ill persons within Hernando and Pasco Counties. HPH was approved to expand its services north to Citrus County in 2004. HPH is a high-quality provider of hospice services in the service areas where it currently operates. It provides pain control and symptom management, spiritual care, bereavement, volunteer, social work, and other programs. HPH employs a physician-driven model of hospice care, with significant involvement of hospice and palliative care physicians who are physically present treating patients in their homes. The number of physician home visits provided to hospice patients by HPH physicians is larger than many hospices in Florida and throughout the United States. In 2009, HPH provided over 35,000 visits by physicians, advanced registered nurse practitioners, and licensed physician assistants to its hospice patients. The majority of these visits occurred in the patients' homes. HPH operates multiple facilities that allow for provision of services to patients in various settings and hospice levels of care. Among its facilities, HPH operates four buildings it calls Care Centers, at which patients can receive general in-patient care. Additionally, HPH operates four units which it calls Hospice Houses. Those units provide for residential care in a home-like environment for patients who do not have caregivers at home or who otherwise are in need of a home. HPH receives no reimbursement for room and board for the care provided at its Hospice Houses and expends over $1.4 million annually in charity care to operate these Hospice Houses for the benefit of its patients. HPH has an established record of providing all levels of hospice care and does not use its Care Centers as a substitute for providing continuous care in the patient's home when such care is needed. Annually, HPH provides approximately percent of its patient days for continuous care patients. HPH has well-developed staff education and training programs, including specialized protocols for care and treatment of patients by terminal disease type such as Alzheimer's, COPD, cancer, failure to thrive, and pulmonary diseases. Odyssey Odyssey is the entity applying for a new hospice program in Service Area 5B. The sole shareholder of Odyssey is Odyssey HealthCare Operating B, LP, which is a wholly-owned subsidiary of Odyssey HealthCare, Inc. (OHC), Odyssey's parent and management affiliate. Odyssey was formed for the purpose of filing for CON applications in Florida and, thereafter, for owning and operating hospice programs in Florida. OHC is a publicly-traded company founded in 1996 and focuses on caring for patients at the end of life's journey. OHC's sole line of business is hospice services. OHC's patient population consists of approximately 70 percent non-cancer and 30 percent cancer patients. OHC is one of the largest providers of hospice care in the United States. OHC has approximately 92 Medicare-certified programs in 29 states, including established programs in Miami-Dade (Service Area 11) and Volusia (Service Area 4B) Counties and a start-up program in Marion County (Service Area 3B), which was licensed in January 2010. Over four years ago, OHC was the subject of an investigation by the United States Department of Justice that ultimately resulted in a settlement and payment of $13 million to the federal government in July 2006. The settlement did not involve the admission of liability or acknowledgement of any wrongdoing by OHC. As part of the settlement, OHC entered into a corporate integrity agreement (CIA) with a term of five years. Odyssey is now in the final year of the CIA. The settlement and CIA allow OHC to self-audit to ensure compliance with the Medicare conditions of participation, which is the first and only time the OIG has allowed a provider to self audit. Suncoast Suncoast is a large and well-developed comprehensive hospice program serving Pinellas County, Service Area 5B. Suncoast is the sole provider of hospice services in Service Area 5B. According to data reported to the Department of Elder Affairs, Suncoast had 7,375 admissions and provided 795,102 patient days of care in 2009, more than any other Florida hospice. In that same year, Suncoast provided 115,247 patient days of care in assisted living facilities, the third highest total in Florida. Suncoast considers itself a model for hospice across the United States and the world. Suncoast has a large depth and breadth of programs, including community programs offered by its affiliate organizations, such as the AIDS Service Association of Pinellas County, the Suncoast Institute, and Project Grace. Suncoast is active in the national organization for hospices and interacts with programs that use it as a model and resource. Unlike the applicants, Suncoast does not use the Medicare conditions or definitions to limit or define the scope of services it provides. Under the Florida definition, hospice is provided to patients with a life expectancy of 12 months or less. HPH, by way of contrast, uses the Centers for Medicare and Medicaid Services definition for hospice, i.e., a prognosis of six months or less. Overview of Hospice Services In Florida, hospice programs are required to provide a continuum of palliative and supportive care for terminally ill patients and their families. Under Florida law, a terminally ill patient has a prognosis that his/her life expectancy is one year or less if the illness runs its normal course. Under Medicare, a terminally ill patient is eligible for the Medicare Hospice benefits if their life expectancy is six months or less. Hospice services must be available 24 hours a day, seven days a week, and must include certain core services, including nursing, social work, pastoral care or counseling, dietary counseling, and bereavement counseling. Physician services may be provided by the hospice directly or through contract. Hospices are required to provide four levels of hospice care: routine, continuous, in-patient, and respite. Hospice services are furnished to a patient and family either directly by a hospice or by others under contractual arrangements with a hospice. Services may be provided in a patient's temporary or permanent residence. If the patient needs short-term institutionalization, the services are furnished in cooperation with those contracted institutions or in a hospice in-patient facility. Routine home care comprises the vast majority of hospice patient days. Florida law states that hospice care and services provided in a private home shall be the primary form of care. Hospice care and services, to the extent practicable and compatible with the needs and preferences of the patient, may be provided by the hospice care team to a patient living in an assisted living facility (ALF), adult family-care home, nursing home, hospice residential unit or facility, or other non-domestic place of permanent or temporary residence. A resident or patient living in an ALF, nursing home, or other facility, who has been admitted to a hospice program, is considered a hospice patient, and the hospice program is responsible for coordinating and ensuring the delivery of hospice care and services to such person pursuant to the statutory and rule requirements. The in-patient level of care provides an intensive level of care within a hospital setting, a skilled nursing unit or in a freestanding hospice in-patient facility. The in- patient component of care is a short-term adjunct to hospice home care and home residential care and should only be used for pain control, symptom management, or respite care in a limited manner. In Florida, the total number of in-patient days for all hospice patients in any 12-month period may not exceed 20 percent of the total number of hospice days for all the hospice patients of the licensed hospice. Continuous care, similar to in-patient care, is basically emergency room or crisis care that can be provided in a home care setting or in any setting where the patient resides. Continuous care, like in-patient care, was designed to be provided for short amounts of time, usually when symptoms become severe and skilled and individual interventions are needed for pain and symptom management. Respite care is generally designed for caregiver relief. It allows patients to stay in hospice facilities for brief periods to provide breaks for the caregivers. Respite care is typically a very minor percentage of overall patient days and is generally designed for caregiver relief. Medicare reimburses the different levels of care at different rates. The highest level of reimbursement is for continuous care. Approximately 85 to 90 percent of hospice care is covered by Medicare. The goal of hospice is to provide physical, emotional, psychological, and spiritual comfort and support to a terminally ill patient and their family. Hospice care provides palliative care as opposed to curative care, with the focus of treatment centering on palliative care and comfort measures. There is no "bright line test" as to what constitutes palliative care and what constitutes curative care. The determination is made on a case-by-case basis depending upon the facts and circumstances of each such case. However, palliative care generally refers to services or interventions which are not curative, but are provided for the reduction or abatement of pain and suffering. Hospice care is provided pursuant to a plan of care that is developed by an interdisciplinary group consisting of physicians, nurses, social workers, and various counselors, including chaplains. There are certain services required by individual hospice patients that are not necessarily covered by Medicare and/or private or commercial insurance. These services may include music therapy, pet therapy, art therapy, massage therapy, and aromatherapy. There are also more complicated and expensive non-covered services, such as palliative chemotherapy and radiation that may be indicated for severe pain control and symptom control. Suncoast provides, and both Odyssey and HPH propose, to provide hospice patients with all of the core services and many of the other services mentioned above. Fixed Need Pool The Agency has a numeric need formula within its rule for determining the need for an additional hospice program in a service area. See Fla. Admin. Code R. 59C-1.0355(4)(a). When applying the formula in the present case, AHCA ultimately determined that the fixed need was zero for the second batching cycle of 2009. In the absence of numeric need, an applicant must document the existence of one of three delineated special circumstances set forth in Florida Administrative Code Rule 59C-1.0355(4)(d), i.e., (1) That a specific terminally ill population is not being served; (2) That a county or counties within the service area of a licensed hospice program are not being served; or (3) That there are persons referred to hospice programs who are not being admitted within 48 hours. Absent numeric need or one of the delineated special circumstances, there cannot be approval of a new hospice program. In forecasting need under the hospice rule's methodology, AHCA uses an average three-year historical death rate. It applies this average against the forecasted population for a two-year planning horizon. AHCA also uses a statewide penetration rate, which is the number of hospice admissions divided by hospice deaths. The statewide average penetration rate is subdivided into four categories: cancer over age 65, cancer under age 65, non-cancer over age 65, and non-cancer under age 65. The projected hospice admissions (based on death rate and projected population growth) in each category are then compared to the most recent published actual admissions to determine the number of projected un-met admissions in each category. If the total un-met admissions in all categories exceed 350, a new hospice is warranted, unless there is a recently approved hospice in the service area or a new hospice provider has not been operational for two years. In the instant case, AHCA's final projections showed the net un-met need for hospice's admissions in Service Area 5B was 318, i.e., below the threshold amount of 350 necessary to establish need for an additional hospice program. The fixed need pool for the purpose of this administrative hearing is zero. HPH is primarily basing its determination of need for a new hospice on its contention that there are three specific terminally ill population groups in Pinellas County that are not being served. Odyssey is primarily basing its determination of need for a new hospice on its contention that there are persons being referred to the existing hospice program in Pinellas County who are not being admitted within 48 hours. The Proposals HPH's Proposal HPH proposes to establish its new hospice program in Pinellas County, Service Area 5B. HPH is currently licensed to provide hospice care in three contiguous sub-districts north of Service Area 5B, i.e., in Hernando, Pasco, and Citrus counties. HPH's corporate headquarters is located in Pasco County, ten to 15 minutes from the Pinellas County border. HPH currently operates a home health agency in Pinellas County. HPH's CON application identifies special circumstances justifying approval of its proposal, including four sub-populations of terminally ill persons who are currently underserved in Service Area 5B: (1) patients living in ALFs; (2) patients requiring continuous care; (3) medically complex patients; and (4) patients not being admitted within 48-hours. Another circumstance identified by HPH to support approval of its application is the fact that Pinellas County is one of the most populous and most elderly service areas in the State, and yet, it only has a single hospice provider. HPH argues that the fact Suncoast is a sole hospice provider for the service area exacerbates and contributes to the problems of gaps in available hospice services to the specific terminally ill sub-populations identified in its CON application. HPH proposes a de-centralized model of hospice service delivery similar to its model in the three contiguous counties where HPH presently provides hospice services. HPH proposes contracting with existing nursing homes and hospitals for in-patient beds ("scatter beds") throughout Service Area 5B. HPH then projects that it could offer in-patient services in the local neighborhoods of patients and families where they live, as opposed to transferring patients to a single in-patient facility for the provider's convenience. As census increases, HPH commits to establish, by month seven of operation, a dedicated in-patient unit to provide in-patient level of care and Hospice House residential care to patients in a home-like environment. Like its hospice operations in Hernando, Pasco and Citrus Counties, HPH proposes to implement its "physician- driven" model of hospice care in Service Area 5B, allowing for greater involvement of physicians in the care and treatment of hospice patients, including physician home visits. Odyssey's Proposal Odyssey proposes to address lack of competition2 in Service Area 5B and the special circumstance of patients not being admitted within 48 hours of referral. Under AHCA's hospice rule, an applicant may demonstrate the need for a new hospice provider if there are persons referred to a hospice program who are not being admitted within 48 hours. However, the applicant must indicate the number of such persons. Odyssey relies upon referral of admission statistical information previously provided by Suncoast to a sister Odyssey entity in a 2005 hospice CON matter. Suncoast at that time provided three years of data that demonstrated between 1,700 (31 percent of admissions) and 2,300 (38 percent of admissions) of patients admitted to Suncoast were admitted 72 hours or more after referral. The definition of referral by Suncoast, however, differs from the definition of referral relied upon by Odyssey. (See Paragraph 56, herein.) Odyssey also provided letters of support from the community to further evidence the existence of the 48-hour special circumstance. However, the letters of support originally appeared in an application filed by Odyssey in 2007 and were not given any weight in the instant proceeding based on their staleness. Odyssey also contends that the existence of a sole provider in Service Area 5B has created a monopolistic situation in the service area. It further contends that the lack of competition has led to the existence of a 48-hour special circumstance in Service Area 5B. Approval of Odyssey's application will, it says, eliminate the monopoly currently existing in Service Area 5B and will address the lack of competition currently occurring in Service Area 5B. Subsection 408.045(2), Florida Statutes, speaks of a "regional monopoly," but there is no credible evidence in the record to suggest that Suncoast's position as a sole provider in Pinellas County constitutes a "regional monopoly." Facts Concerning Special Circumstances Arguments Service Area Demographics Hospice Service Area 5B, Pinellas County, is a single-county hospice service area with a population of approximately one million residents. Pinellas County is currently ranked as the fourth largest county in the State in total numbers of elderly persons over 65 years of age, as well as elderly persons over 75 years of age, behind only Miami-Dade, Broward and Palm Beach Counties. Pinellas County also experienced the fourth highest number of total deaths in the State in 2008--11,268. Pinellas County's mortality rate in recent years has slowed. However, even considering a slower growth rate in the number of deaths, Pinellas County likely will remain the fourth largest county in the State in both elderly population and number of deaths through 2015. Although it is the fourth largest service area in terms of likely hospice patients, Suncoast is the sole hospice provider in Service Area 5B. By contrast, the other three largest service areas all have multiple hospice programs to serve their large elderly populations with eight providers in Service Area 11 (Miami-Dade), five providers in Service Area 10 (Broward), and three providers in Service Area 9C (Palm Beach). In assessing the extent of utilization of hospice services in Service Area 5B, HPH through its health planner, Patricia Greenberg, noted that Suncoast appears to have over-stated its utilization rate in its semi-annual reports to AHCA. Ms. Greenberg testified that Suncoast's AHCA data includes patients who are not truly hospice patients and are, instead, patients who are participating in non-hospice programs operated by Suncoast, including palliative care programs known as "Suncoast Supportive Care" and "Hospital Support." The number of such patients was not quantified by Ms. Greenberg.3 Suncoast counters that it does not let the conditions of participation define the scope and breadth of hospice services it offers. Suncoast tries not to be defined by the Medicare conditions of participation and has programs that are not covered by the benefit, including but not limited to its residential care at Woodside and its caregiver services. Specific Terminally Ill Populations HPH identified as under-served in Service Area 5B medically complex patients with complex medical needs, including multiple IVs, wound vacs, ventilator, complex medications, or acutely uncontrolled symptoms in multiple domains. These are the same kinds of patients who would require continuous care within their homes. Hospice patients have become more highly acute in recent years. More patients are being discharged from hospitals with highly complex medical conditions, often directly from hospital intensive care units. Patients discharged directly from hospitals tend to have higher acuity levels. Ms. Greenberg reviewed Suncoast's data on hospital discharges and found Suncoast statistically lags behind HPH in caring for medically complex patients discharged from hospitals. Looking at a three-year average, HPH had 3.7 percent of its hospice discharges directly admitted from hospitals, compared to percent for Suncoast. This is more than a 50-percent deviation between hospital discharges to hospice for HPH versus Suncoast. However, a comparison of Suncoast to HPH does not establish that there is a specific underserved population in Service Area 5B which is not receiving services. One case manager testified to sometimes not being able to timely find hospice placements for medically complex patients. Such patients would then have to be transferred from the hospital to a nursing home or rehabilitation facility. However, she did not testify that this specific terminally ill population was not being served, only that they were being served somewhere other than in an in-patient hospice bed. Medically complex patients, including those needing continuous care, were another specific terminally ill population identified by HPH. At page 54 of her deposition, Deborah Casler, a case manager at Helen Ellis Hospital, addressed those populations, saying, "[w]hat I am going to say is if anybody needed continuous care through Suncoast, it would happen, but it wasn't always a quick and easy process." HPH compared its percentage of continuous care patient days with Suncoast, showing that HPH had more. That does not equate to an absence of service for any specific terminally ill population. HPH attempts to create a presumption that services are not being provided by conditioning its application on a certain percentage (3 percent) of days for continuous care patients. That is merely a projection of intent; it is not evidence that a certain population is not currently being served. Assisted Living Facility Residents HPH provided anecdotal evidence that some ALFs in Pinellas County were not pleased with the services being provided by Suncoast. One ALF administrator was dissatisfied that Suncoast took a long time to admit her resident (but the resident was ultimately admitted). Another was disappointed with Suncoast because it took a long time to get medications for her resident. Another felt like Suncoast's quality of care was inferior. HPH provides a greater percentage of hospice services to ALF residents in Pasco (12.7 percent), Hernando (26.5 percent), and Citrus (23.5) counties than Suncoast provides to ALF residents in Pinellas County. There are approximately 215 ALFs in Pinellas County of varying sizes, i.e., from three beds to almost 500 beds. Suncoast did not provide services to all of them. There was no showing, however, that any resident of an ALF who needed or requested hospice services was denied such care. None of the evidence presented by HPH establishes the existence of a group of ALF residents who were not being served in the service area; nor does the evidence prove that any specific ALF residents are, in fact, terminally ill. The 48-Hour Admission Provision Neither Suncoast, nor Odyssey presented any hard data on timeliness of admissions. In fact, none of the parties could agree as to what action constitutes an admission. Suncoast says an admission must include a physician order and a consent by the patient and family. Odyssey identifies a referral as a telephone call from a family member, even if the call is simply an inquiry as to what services might be available. Odyssey says that the majority of its patients are admitted within three hours of referral and at least 80 percent are admitted within 24 hours. During that three-hour time frame, Odyssey will contact the family, contact the physician in order to evaluate and admit, if appropriate, screen the patient to ensure he or she meets the eligibility guidelines, go out and meet with the family, and provide support while necessary information is being gathered. HPH candidly admits that the issue of admissions within 48 hours does not, in and of itself, justify the approval of a new hospice program in Service Area 5B. However, HPH argues, it is an element of hospice services that HPH would do better than the other parties. There is no credible evidence in the record that an identified number of persons in Pinellas County had not been admitted to hospice within 48 hours of referral. Statutory and Rule Review Criteria Rule Preferences The Agency is required to give preference to an applicant meeting one or more of the criteria specified in Florida Administrative Code Rule 59C-1.0355(4)(e)1 through 5: Commitment to serve populations with unmet need.-- There is no numeric need in this matter. Neither applicant proved the existence of a population with unmet need. Commitment to provide in-patient care through contract with existing health care facilities.-- Both HPH and Odyssey intend to use scatter beds and to contract with existing health care providers. Commitment to serve homeless and AIDS patients, as well as patients without caregivers.--Both applicants have shown a history of serving such groups and commit to do so in Pinellas County. Not Applicable. Commitment to provide services not covered by insurance, Medicare or Medicaid--Both applicants have a good history of providing indigent care and commit to do so in Pinellas County. Consistency with Plans; Letters of Support Florida Administrative Code Rule 59C-1.0355(5) requires consideration of the applications in light of the local and state health plans. The local health council plans are no longer a factor in this proceeding. The state health plan addresses the concept of letters of support. Again, as neither applicant proved special circumstances warranting approval of a new hospice program, this comparison is unnecessary. However, there was considerable testimony and argument at final hearing concerning letters of support and the issue deserves some discussion. Each applicant provided letters of support. In fact, HPH's application contained over 250 letters of support from a wide range of writers, including physicians, nurses, ALF and nursing home administrators, and others. AHCA even complimented HPH's letters of support in both quantity and quality. Such letters are, of course, hearsay and cannot be relied upon to make findings as to the statements made herein. However, the fact that HPH generated so many letters of support is a fact that lends additional credence to their application. Odyssey's letters of support, by comparison, were much fewer in number. The letters were also dated, having come from a CON application filed some three years prior to the application currently at issue. The content of those letters would also be hearsay. And in the present action, the age of the letters would reduce their significance as support for the Odyssey CON application at issue. Statutory Review Criteria The Agency reviews each CON application in context with the criteria set forth in Subsection 408.035(1)(a) through (j), Florida Statutes: Subsection 408.035(1)(a), Florida Statutes--The need for the health care facilities and health services being provided There was no need projected by AHCA under its need methodology. Neither party established the existence of special circumstances warranting approval of a new hospice program in Service Area 5B. Subsection 408.035(1)(b), Florida Statutes-- availability, quality of care, accessibility, and extent of utilization Suncoast is the sole provider of hospice services in Service Area 5B. This service area is one of the largest in the State. There are other service areas which have a single hospice provider, but Service Area 5B is the largest service area to be served by a single hospice provider. Service Area 5B experienced the fourth largest number of deaths in the State in 2008, an important factor in the provision of hospice care. Suncoast has 15 interdisciplinary care teams, each of which, lead by a patient-family care coordinator, includes RNs, home health aides, counselors, volunteers, and a chaplain. Suncoast has a north community service center in Palm Harbor that houses four patient care teams. On the back of that property is Brookside, Suncoast's newly built 30-bed in-patient facility. In central Pinellas County, Suncoast has its main service center with six patient care teams along with administrative and support offices. Suncoast has a pharmacy, as well as durable medical equipment and infusion departments, located in Largo. In central Pinellas County is Suncoast's ten-acre, 72-bed Woodside facility. Thirty-six of the beds are in-patient and 36 are residential. On the back of the property are 18 efficiency apartments called "Villas" with separate living, sleeping and kitchen areas. When patients become too ill to remain at home, their spouse may move into a villa until the patient dies. In the southern portion of the county is Suncoast's south community service area which houses five patient care teams, as well as "ASAP." ASAP is Suncoast's AIDS Service Association of Pinellas County which serves and provides support to patients with HIV and AIDS. Suncoast also has in-patient contracts with every hospital in Pinellas County and a number of contracts with nursing homes for in-patient care. Patients may receive continuous care in the home whether that is a residence, an ALF, or a nursing home or may receive care in the Suncoast in-patient unit. There is disagreement over whether Suncoast accurately reports its admissions and whether all reported admissions are actually hospice patients. Further, HPH points out that its penetration rate in counties where it operates is much higher than Suncoast's penetration rate in Pinellas County. However, the most credible evidence is that Suncoast is effectively serving the needs of hospice-eligible residents of Service Area 5B. Subsection 408.035(1)(c), Florida Statutes--ability to provide quality of care and record of providing quality of care Both applicants satisfy this criterion. Both applicants can provide a broad range of quality hospice services to all its patients. HPH touts its physician model, including physician home visits, as evidence of its commitment to quality care. Physician visits have been proven to help patients get pain under control more quickly, an important factor considering ten percent of hospice patients die within 48 hours of admission. Odyssey is a large company and has extensive operational policies and procedures concerning provision of quality care to its patients. Odyssey has a program called Care Beyond which it believes will enhance quality care in Service Area 5B. Odyssey has had some regulatory violations while HPH has not. However, Odyssey has resolved those violations favorably. Subsection 408.035(1)(d), Florida Statutes-- availability of resources, including health personnel, management personnel, and funds for project accomplishment and operation The parties stipulate that both applicants meet this criterion. Subsection 408.035(1)(e), Florida Statutes--extent to which proposed services will enhance access to health care for residents of the service district Both applicants satisfy this criterion. HPH is the existing provider of hospice services in the adjacent service area to Service Area 5B. HPH can use its existing contacts in Service Area 5B to extend its service to residents of that area. HPH has already established relationships with Airamed Corporation and its 11 nursing homes and ALF in Service Area 5B. HPH also commits to being more directly involved with smaller ALFs in Pinellas County. Odyssey is a large hospice with significant resources which can be utilized to enhance access for residents of Service Area 5B. It commits to bring quality personnel to Service Area 5B as part of its successful start-up procedures. Subsection 408.035(1)(f), Florida Statutes--immediate and long-term financial feasibility The parties stipulate that both applicants meet this criterion. Subsection 408.035(1)(g), Florida Statutes--extent to which proposal will foster competition that promotes quality and cost-effectiveness Both applicants are established providers of hospice services. The absence of any other hospice provider in Pinellas County means there is no effective competition. If either of the applicants was granted a CON for a new hospice in Service Area 5B, it would likely foster competition and promote quality and cost-effectiveness. Subsection 408.035(1)(h), Florida Statutes--costs and methods of construction, etc. This criterion is not applicable to the instant case. Subsection 408.035(1)(i), Florida Statutes--the applicant's past and proposed provision of health care services to Medicaid patients and the medically indigent Both applicants meet this criterion. HPH offers extensive services that go beyond the Medicare requirements of participation. It also operates "Hospice Houses" which provide room and board to homeless hospice patients. Odyssey's record of indigent care is evidenced by the fact that approximately 55 percent of its non-Medicare net revenue is from Medicaid, and 9.5 percent of its non-Medicare services are provided to indigent patients. Subsection 408.035(1)(j)--designation as a Gold Seal Program This criterion is not applicable to the instant case. Ultimate Findings of Fact The Agency determined that there is no need for an additional hospice in the service area based upon the fixed need pool formula. Neither applicant was able to establish the existence of special circumstances warranting approval of a new hospice in the service area. There is no specific terminally ill population which is not receiving hospice services that has been identified by the applicants. There is no persuasive evidence that there is an identifiable number of individuals who were referred to hospice, but were not admitted within 48 hours.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Agency for Health Care Administration denying the CON applications of HPH South, Inc. (No. 10066), and Odyssey Healthcare of Collier County d/b/a Odyssey Healthcare of Central Florida (No. 10068). DONE AND ENTERED this 30th day of November, 2010, in Tallahassee, Leon County, Florida. S R. BRUCE MCKIBBEN 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 30th day of November, 2010.
The Issue Whether the Certificate of Need (“CON”) applications filed by Seasons Hospice and Palliative Care, Inc. (“Seasons”); Gulfside Hospice and Pasco Palliative Care, Inc. (“Gulfside”); and West Florida Health, Inc. (“West Florida”); for a new hospice program in Agency for Health Care Administration (“AHCA” or the “Agency”) Service Area 6A/Hillsborough County, satisfy the applicable statutory and rule review criteria sufficiently to warrant approval, and, if so, which of the three applications best meets the applicable criteria, on balance, for approval.
Findings Of Fact Procedural History The Fixed Need Pool On October 3, 2014, the Agency published a need for one additional hospice program in Hospice Service Area 6A, Hillsborough County, for the January 2016 planning horizon. Under the Agency's need methodology, numeric need for an additional hospice program exists when the difference between projected hospice admissions and the current admissions in a service area is equal to or greater than 350. The need methodology promotes competition and access because numeric need exists under the methodology when the hospice use rate in a service area falls below the statewide average use rate. In a service area in which there is a sole hospice provider, as in the present case, the existing provider has an incentive to continually improve access to hospice services in the service area in order to avoid numeric need for an additional program under the formula. For the January 2016 planning horizon, the Agency determined that the difference between projected hospice admissions and current admissions in Hospice Service Area 6A was 759, and therefore a numeric need for an additional hospice program exists in Hillsborough County. AHCA is the state agency authorized to evaluate and render final determinations on CON applications pursuant to section 408.034(1), Florida Statutes. The Proposals and Preliminary Decision Nine applicants submitted CON applications seeking to establish a new hospice program in AHCA Service Area 6A, Hillsborough County, in response to the fixed need pool. LifePath, the only existing provider of hospice care in the service area, opposed the hospice application which was sponsored by a hospital system, i.e., West Florida’s. After reviewing the applications, the Agency preliminarily approved West Florida's CON Application No. 10302 and preliminarily denied the remainder of the applications, including Seasons’ CON Application No. 10298 and Gulfside's CON Application No. 10294. At the final hearing, Marisol Fitch, supervisor of AHCA's CON unit, testified that the Agency approved West Florida's CON application because it determined that West Florida's application best promotes increased access to hospice services for residents of Hillsborough County. The Agency concluded that Tampa General and Florida Hospital, West Florida's parent organizations, already have large infrastructures in place in Hillsborough County. Accordingly, the Agency determined that West Florida's proposed hospice program, if approved, would benefit from built-in access points that would enable West Florida to improve hospice accessibility. The Applicants, AHCA and Lifepath West Florida West Florida is a joint venture with 50-50 ownership and control by Tampa General and Florida Hospital, two acute care hospitals in Hillsborough County. The entity was created for the purpose of seeking the CON at issue in this proceeding for a new hospice in Service Area 6A. West Florida recently became the owner/operator of three home health agencies which had been operated for several years by the Florida Hospital System. Tampa General has not operated hospices in the past, while Florida Hospital has, and the CON application submitted by West Florida relied heavily upon the Florida Hospital-affiliated hospice’s programs and history. West Florida is the only applicant in this proceeding that is hospital affiliated. Seasons Seasons, the applicant, is a single purpose entity created for the purpose of seeking a CON to operate a new hospice in Service Area 6A. It is affiliated with Seasons Hospice and Palliative Care, a for-profit company (hereinafter referred to as “Seasons HPC”). Seasons HPC is the largest family-owned hospice organization in the country. The first Seasons HPC-affiliated hospice opened in Chicago, Illinois, in 1997. In 2003, Seasons HPC opened its second hospice in Milwaukee, Wisconsin, and in 2004, it acquired a third hospice in Baltimore, Maryland. Since 2004, Seasons HPC has continued to grow nationally by opening, or in some cases acquiring, hospices in new markets. Today, Seasons HPC is the fourth largest hospice company in the United States with 25 separate hospices operating in 18 different states. Each Seasons HPC-affiliated hospice is a separate entity, with its own license, executive director, and staff. However, each Seasons HPC hospice is connected via overlapping ownership and via contracts with Seasons Healthcare Management, its management company. Among the services that Seasons Healthcare Management provides to each Seasons HPC hospice are: education and training, quality management, financial planning support, management of payrolls, tax preparation, cost report preparation and coordination, IT services, corporate compliance policies and programs, marketing and development expertise, in- house legal services, and a wide variety of policies and consultations including, but not limited to, clinical support and physician oversight. Todd Stern is the CEO of Seasons Healthcare Management and is also the CEO of the 25 separate hospices that Seasons HPC operates throughout the country. Mr. Stern joined Seasons HPC in 2001, and was appointed CEO in 2008. Gulfside Gulfside is a 501(c)3 community-based, not-for-profit organization and is licensed by AHCA. Gulfside has been providing hospice services in Pasco County (which is contiguous to Hillsborough County) for more the 25 years. Gulfside provides service to all patients in need regardless of race, creed, color, gender, sexual orientation, national origin, age, qualified individual with a disability, military status, marital status, pregnancy, or other protected status. LifePath LifePath is the sole existing, licensed hospice provider in Hospice Service Area 6A, Hillsborough County. LifePath is a subsidiary of Chapters Health System. LifePath has provided hospice services in Hillsborough County since 1983. It was the first hospice program in the state to be accredited by The Joint Commission and has continuously maintained that accreditation. LifePath is also accredited by the National Institute for Jewish Hospices. In addition to providing routine, continuous, and respite care to residents of Hillsborough County, LifePath also provides inpatient hospice care in two, 24-bed hospice houses located in Temple Terrace and Sun City, Florida. Additionally, LifePath has scatter-bed contracts with all of the acute care hospitals in Hillsborough County to provide inpatient care. LifePath is an important part of the healthcare continuum in Hillsborough County and works collaboratively with other healthcare providers in the community, including hospitals, nursing homes, and assisted-living facilities. AHCA AHCA is the state agency responsible for administering the Florida CON program. Overview of Hospice Services In Florida, a hospice program is required to provide a continuum of palliative and supportive care for terminally ill patients and their families. A terminally ill patient has a medical prognosis that his or her life expectancy is one year or less if the illness runs its normal course. Under the Medicare program administered by the federal government, a terminally ill patient is one who has a life expectancy of six months or less. Hospice services must be available 24 hours a day, seven days a week, and must include certain core services, such as nursing services, social work services, pastoral or counseling services, dietary counseling, and bereavement counseling services. Physician services may be provided by the hospice directly or through contract. Hospice care and services provided in a private home shall be the primary form of care. Hospice care and services may also be provided by the hospice to a patient living in an assisted living facility, adult family-care home, nursing home, hospice residential unit or facility, or other non-domestic place of permanent or temporary residence. The inpatient component of care is a short-term adjunct to hospice home care and hospice residential care and shall be used only for pain control, symptom management, or respite care. The hospice bereavement program must be a comprehensive program, under professional supervision, that provides a continuum of formal and informal support services to the family for a minimum of one year after the patient's death. The goal of hospice is to provide physical, emotional, psychological, and spiritual comfort and support to a dying patient and their family. Hospice care provides palliative care as opposed to curative care, with the focus of treatment centering on palliative care and comfort measures. Hospice care is provided pursuant to a plan of care that is developed by an interdisciplinary team consisting of, e.g., physicians, nurses, social workers, counselors, chaplains, and other disciplines. There are four levels of service in hospice care: routine home care, continuous care, general inpatient care, and respite care. Generally, hospice routine home care comprises the vast majority of patient days and respite care is typically a very minor percentage of days. Continuous care is basically emergency room-like or crisis care that can be provided in a home care setting or in any setting where the patient resides. Continuous care is provided for short amounts of time usually when symptoms become severe and skilled and individual interventions are needed for pain and symptom management. The inpatient level of care provides the intensive level of care within a hospital setting, a skilled nursing unit, or in a free-standing hospice inpatient unit. Respite care is generally designed for caregiver relief. Medicare reimburses different levels of care at different rates. Approximately 85-to-90 percent of hospice care is paid for by Medicare. There are certain services required or desired by some patients that are not necessarily covered by Medicare and/or private or commercial insurance. These services include music therapy, pet therapy, art therapy, massage therapy, and aromatherapy, among others. There are other, more complicated and expensive non-covered services, such as palliative chemotherapy and radiation, that may be indicated for severe pain control and symptom control. Hospices which provide these additional services are said to have “open access” and foot the bill for such services. The Parties’ Proposals Each of the applicants- -as well as LifePath and the Agency– -agree that any one of the applicants could provide quality hospice services if approved. The following paragraphs set out some of each applicant’s attributes. Before each of the applicants’ proposals is discussed more fully below, it is clear that all of the applicants would likely be successful if approved. As stated by the parties themselves: “All three applicants . . . have the ability to operate a high quality hospice.” West Florida counsel, Tr., p. 12. “These are all excellent providers” and “There are no bad choices here.” AHCA counsel, Tr., pp. 1802 and 2009. “All [applicants] would be qualified; they all do good.” Lifepath counsel, Tr., p. 1980. “All applicants will undoubtedly provide the same level of quality care.” West Florida PRO, ¶ 59. The ultimate concern of AHCA regarding a new hospice provider in Hillsborough County is not the quality of care that the applicants can provide. All applicants will undoubtedly provide the same level of quality care. The real concern is costs, access, and availability. The Agency believes that West Florida will be best suited to promote cost effectiveness, as well as increase access and availability. A. West Florida West Florida is a collaborative effort by two existing, licensed hospitals in the service area. West Florida justifiably touts its connection to educational institutions. West Florida conditioned its approval on the funding of an additional palliative care fellowship at the University Of South Florida College of Medicine at an annual cost of roughly $80,000 and an additional CPE resident in Tampa General’s CPE program at an annual cost of $30,000. Having West Florida as part of the Tampa General “family” will expose not only the new palliative care fellow, but also medical students, medical interns and residents, other fellows, nurses, and a wide variety of allied health professionals, to hospice services and the benefits of hospice care. The new CPE resident could help to expand knowledge about end-of-life care and ultimately improve access to hospice services. West Florida will benefit the Tampa General pastoral care and CPE program by extending pastoral palliative care and end-of-life care training and experiences for all CPE students. Florida Hospital is a part of the Adventist Health System, which operates all types of healthcare facilities throughout the nation, including hospitals, rehab facilities, home health agencies, hospices, long term acute care hospitals, nursing homes, and more. In Florida, Adventist operates a range of facilities, including statutory teaching hospitals, quaternary-level service providers, critical-access hospitals, and safety net hospitals. In Hillsborough County, Florida Hospital operates Florida Hospital Tampa and Florida Hospital Carrollwood, both acute care facilities, in addition to a variety of outpatient facilities, physician practices, and the like. West Florida has proposed and is committed to opening a four-bed hospice inpatient unit at Florida Hospital Carrollwood, located in the northwestern portion of the county. Currently, there are two other inpatient hospice house units in Hillsborough County, one on the eastern side and one in the far south, both operated by LifePath. The unit would theoretically benefit hospice patients by increasing the number of inpatient beds and improving geographic distribution, thereby providing more access to hospice care. An inpatient unit may operate better than contracted “scatter beds” because hospice staff trained in end-of-life care and symptom management would be the medical personnel providing care to the patient rather than other hospital staff. Florida Hospital is an experienced provider of hospice services in the State of Florida, operating Florida Hospital Hospice Care in Volusia and Flagler Counties, as well as Hospice of the Comforter in Orange and Osceola Counties. Ms. Rema Cole is the administrator for Florida Hospital Hospice in Flagler and Volusia Counties. She has been responsible for opening two new hospice programs in the State of Florida. West Florida will provide a wide variety of unfunded “open access” services to its patients, such as: radiation and chemotherapy, caring for patients on ventilators, and training staff to provide these services. Combined, Florida Hospital and Tampa General touch tens of thousands of lives in Hillsborough County, totaling approximately 52,000 patients each year. Tampa General or Florida Hospital could tell its patients and their families about the goals and benefits of hospice care. It is likely West Florida would tend to promote its own hospice more prominently than it would promote its competitor’s (LifePath) services. West Florida suggests the possibility of a fully integrated electronic medical record. It would entail a long process, but steps have already been taken to begin the integration. The ability of the medical records of both Tampa General Hospital and Florida Hospital to “talk” to each other and all related ancillary providers, including its clinically integrated network, home health agency, and West Florida could improve the ability to reduce costs, as well as emergency room visits and unplanned admissions of hospice patients to hospitals. Having a streamlined system that communicates between the hospice, hospitals, and their ancillary providers could reduce workload, unnecessary paperwork, and increase the efficiency at which the hospice staff is able to operate. There is no such system in operation yet, but West Florida has plans to implement it once it is available. Florida Hospital Hospice Care provides a wide range of non-compensated programs, including a pet partner program called “HosPooch” that provides pet therapy to patients in inpatient units, nursing homes, ALFs, and even to non-hospice patients at their cancer centers. They also have a recording project called Project Storytellers that has a group of volunteers going into patients’ homes or wherever they may be to talk to the patient about their life, record things that were important to them, and give that recording to the families as a keepsake. Florida Hospital Hospice Care is involved with their local Veterans Administration nursing home and clinic, where volunteers perform pinnings of veterans. There is also music therapy, a group of quilters, and vigil volunteers, who sit at the bedside of patients to keep watch if the caregiver needs to take a break or run errands. West Florida can immediately tap into the existing connections that both Florida Hospital and Tampa General have in the community. These include relationships and connections with physicians, churches, civic groups, and other organizations, both healthcare and non-healthcare related. These existing relationships would serve not only as opportunities to market West Florida, but could also serve as educational opportunities to inform more individuals, groups, and organizations about the benefits of hospice care and the availability of the West Florida. West Florida agreed to condition approval of its CON application on the following eleven concepts: Annual funding for an additional palliative care fellowship at the University of South Florida; Annual funding for an additional CPE resident; Annual sponsorship of up to $5,000 for children’s bereavement camps; Up to $10,000 annually for a special wish fund; Operating a 4-bed inpatient unit at Florida Hospital Carrollwood; Programs which are not paid by Medicare; Offices on the campus of Tampa General and Florida Hospital; Using a licensed clinical social worker with at least a Master’s degree to lead the psychological department; 8) Establish an education program on hospice care accessible to medical staff; Programs for the Hispanic population; and Creation of a community resource information website. A. Seasons Seasons described its proposal for services through various key players within its parent organization. Dr. Balakrishana Natarjan is the chief medical officer for Seasons Healthcare Management. Dr. Natarjan plays an active role in recruiting the medical directors for each Seasons hospice, and the medical director of each hospice reports directly to him. Dr. Natarjan has developed a detailed list of the medical director’s qualifications and responsibilities, and a list of what he deems to be “non-negotiable company values” to which each medical director must agree. It is difficult to imagine how some of those values can be monitored (e.g., “The Medical Director must love holding the patient’s hand”; “The Medical Director must go to bed each night knowing they made a difference in the lives of specific dying patients,” etc.), but the idea of non-negotiables is recognized as positive. Seasons has also recently hired Daniel Maison, M.D., as the associate chief medical officer for the company. Dr. Russell Hilliard is Seasons’ vice-president for Patient Experience and Staff Development. He has a Ph.D. in music education, with an emphasis in music therapy and social work from Florida State University. His work is well-recognized in the hospice community. He was instrumental is starting the music therapy programs at Big Bend Hospice in Tallahassee, Florida, and at Hospice of Palm Beach County (Florida). His concept of music therapy is innovative, inclusive, and well- proven to achieve positive results. Dr. Hilliard will assist Seasons in doing a community-oriented needs assessment to ascertain what needs exist in Hillsborough County, examine how to meet those needs, and establish programs to be implemented upon approval as a hospice provider in the area. Seasons’ music therapies would then be implemented as necessary to meet the identified needs. Seasons has also assembled a team of national experts who are available to assist in various areas. One such expert is Mary Lynn McPherson, Pharm.D. Dr. McPherson has developed an online course entitled “Medication Management at the End of Life for Clinical, Supportive, Hospice and Palliative Care Practitioners,” that is offered through Seasons. Dr. McPherson is purportedly available 24 hours a day, seven days a week, to field numerous calls from Seasons physicians and other staff regarding complex medication management issues. Joyce Simard, a national expert in caring for people with dementia, developed for Seasons HPC hospices a specialized program for patients in the advanced stages of dementia. The program uses person-centered approaches to improve the quality of life for people suffering from dementia through meaningful sensory activities that stimulate the senses and promote comfort and serenity. Seasons Hospice Foundation (Foundation) is an independent 501(c)(3), non-profit foundation founded in 2011. The Foundation was established because Seasons was receiving unsolicited donations from grateful families and friends of patients, and it wanted these funds to go to a charitable purpose. Today the mission of the Foundation is to serve the needs of patients outside the hospice benefit. For example, the Foundation will assist patients who are unable to cover basic non-hospice needs, such as restoring electricity to a patient’s home or airfare so family members can travel to see a patient. Seasons does not rely on charitable contributions or other philanthropy to support its operations, nor does it rely on any other types of non-hospice revenue sources such as thrift shops. Unlike some new hospices which try to conserve resources and hire part-time staff when opening, Seasons invests 100 percent in new programs up front. All of the initial core staff is full-time, even when the hospice may be starting out with just a handful of patients. This allows the hospice team to develop trust among the group and to become familiar with Seasons’ policies, procedures and culture. Each Seasons HPC program and staff is reflective of the ethnic and cultural make-up of the area it serves. However, the mission statement, core values, service standards, operating practices, protocols, and policies are uniform in each Seasons HPC hospice. Seasons provides a large depth and breadth of programs in its hospices. Included among those services are music therapy, pet therapy (using certified pet therapy animals, as well as a specialized robotic seal for certain patients), Namaste (a specialized program for patients in the advanced states of dementia), Kangaroo Kids summer camp, Volunteer Vigil program, Leaving a Legacy, and Careflash. Seasons also participates in the We Honor Veterans program. Seasons would provide “open access” services in Hillsborough County. Seasons would provide these services for patients choosing to continue them so long as their prognosis remains six months or less, and the treatment is approved by the clinical leadership team for appropriateness. Such interventions may include IV antibiotics, blood transfusions, palliative cardiac drips, ventilator support, radiation therapy, heart therapy, dialysis and other palliative therapies. As discussed earlier, Seasons offers a very robust and highly professional music therapy program. But Seasons also provides music companions when simple entertainment is what is called for and Seasons makes sure the entire interdisciplinary staff is trained in this subject. Seasons actively works with hospitals in the markets it serves to educate physicians and allied health professionals in hospice and end-of-life care. Seasons hospices have affiliation agreements with several medical schools around the country to offer internships, fellowships, and other educational opportunities to pre-med students, medical students, and residents. Seasons hires experienced nurses who have previously worked in emergency rooms and intensive care units, and consequently is able to provide a much more clinically complex service than some other hospices. As a result, Seasons is able to serve patients that other organizations typically may not have served. Seasons utilizes a hospice-specific electronic medical record and is the largest hospice client of Cerner, a medical records provider. When a patient is admitted to a Seasons hospice, Seasons gathers the medical history of the patient, including hospital records if the patient has recently been in the hospital, and all relevant non-hospital medical records, including rehab notes, labs and other diagnostic testing results. This integrated electronic medical record is accessible to all Seasons hospice team members. Seasons has a centralized call center that takes calls from patients and their families 24 hours a day, seven days a week. At the call center, there are clinicians who are licensed in every state where Seasons operates who can respond to questions and provide consultation. The call center staff has full access to the patient’s electronic medical record in real time. Seasons also requires that all of its staff, including management at all levels, make calls to check on patients during the term of their treatment (i.e., not only when a patient calls or after the patient has died). In September 2010, Seasons acquired a controlling interest in a hospice in Miami-Dade County that was formerly known as Douglas Gardens Hospice. The hospice was acquired from the Miami Jewish Health System, which retains a 20-percent ownership in the hospice. At the time Seasons took over Douglas Gardens Hospice, the census was approximately 63 patients and the hospice was largely dependent upon referrals from the relatively small Miami Jewish Health System. Seasons retooled the makeup of the staff to better reflect the county’s Hispanic population and aggressively developed outreach efforts across the entire county. By the time of the final hearing, Douglas Gardens had grown to be the second largest hospice in Miami-Dade County with a census of 520 patients. When Seasons acquired its interest in the Miami-Dade County hospice, it diligently pursued referrals from assisted living facilities and nursing homes. In September 2010, Seasons had 13 admissions from ALFs; in September 2015, that number had risen to 154 admissions. Seasons’ hospice in Miami-Dade County has contracts with over 60 percent of the nursing homes in the county. In September 2015, the hospice admitted 110 patients from skilled nursing facilities. It has also pursued marketing to more than 30 acute care hospitals in the county. Today, approximately 40 to 45 percent of Seasons’ referrals in Miami-Dade County come from acute care hospitals. The majority of Seasons’ Miami-Dade County’s staff, including its executive director, is bilingual, and the hospice serves a large number of Hispanic patients. It also employs five to six chaplains, including non-denominational chaplains, a rabbi, and a Catholic priest who is able to deliver the sacrament of last rites. Seasons HPC requires all of its chaplains to be either board-certified or become board-certified within a year of being hired. Seasons HPC has developed a more formalized consulting arrangement with another national expert, Rabbi Elchonon Freedman from West Bloomfield, Michigan. Rabbi Freedman has been involved in the hospice field since the early 1990s and has four CPE units (equivalent to a master’s degree) and is board- certified. He heads the Jewish Hospice & Chaplaincy Network in Michigan which is heavily involved in hospice education across all denominations. Seasons participates in the “We Honor Veterans” program, and its Miami program has achieved Level 3 status. Seasons opened a new hospice in Broward County in late 2014, and it became Medicare certified in August 2015. The Broward hospice has achieved an average daily census of more than 50 patients as of the date of the final hearing. Seasons HPC has been successful in opening and growing new hospices in other large metropolitan markets throughout the country, most of which have no CON requirements and therefore present significantly higher hospice competition. Examples of large metropolitan markets where Seasons has successfully opened and grown the census of new hospices include: Phoenix, northern California, San Bernandino, and Houston. Seasons also agreed to condition its CON application approval on certain agreed services, including: Providing at least two continuing education units per year to registered nurses and licensed social workers at no charge; Offering internship experiences for various disciplines involved in hospice care; Donation of $25,000 per year to fund a wish fulfillment program for its patients and families; Provision of services outside the therapies paid for by Medicare; and Voluntary reporting of the Family Evaluation of Hospice Care survey to AHCA. Gulfside Gulfside is a 501(c)3 community-based, not-for-profit organization licensed by the AHCA as a hospice. Gulfside has been providing hospice services in Pasco County for more the 25 years. Gulfside provides care to all individuals eligible for care who meet the criteria of terminal illness and reside within the service area. Gulfside is accredited by the Joint Commission with Gold Seal status. Gulfside has grown in scope of services and in terms of census and coverage. In July 2004, it had 50 patients and roughly 30 staff members. It had a limited reach within Pasco County, primarily serving the community of New Port Richey. Hernando-Pasco Hospice, now known as HPH, was the dominant hospice provider in Pasco County. Gulfside grew, in part, through extensive community education to physicians and other healthcare and service providers, to its current average census of 360, which makes it the dominant hospice provider in Pasco County. The leadership at Gulfside has extensive experience in hospice, senior living, and Alzheimer’s care and management, including the management of senior living and SNF facilities, and developing new facilities and programs. Gulfside has a depth of experience in oncology care, social work, nursing, hospice and palliative medicine, health care administration, technical development, as well as program and project development. For example, Gulfside’s CEO and COO were both part of the team at LifePath’s Service Area 6B program (Polk, Highland and Hardee Counties) as the program was developing, growing from a census of 200 to 350 in one year. Each hospice patient at Gulfside meets with its interdisciplinary team (“IDT”) at least bi-weekly to discuss patients and to review their plan of care and any adjustments to the care plan. These meetings also include an educational component for IDT members. IDT meetings also take place when a patient requests a change in their care plan or should a change in the patient’s status trigger a new IDT review. Additionally, the physician member of the IDT will confer on a regular basis with the hospice medical director to obtain guidance and advice. The spiritual and pastoral care staff are also part of the IDT. Gulfside has extensive orientation and training for newly hired staff, requires that new staff must demonstrate core competencies before rendering services, and requires all staff to regularly demonstrate their competencies at Gulfside’s recurring “skills days.” Gulfside encourages all disciplines of its staff to maintain competencies, receive additional training, and earn continuing education units in their respective fields. Field staff use web-connected laptops and smartphones to assist with documentation and make live updates to the Electronic Medical Record (Allscripts) which Gulfside phased in over two years ago. Gulfside also has software programs which help to identify potential hospice referrals, allowing them to focus their outreach and education efforts to reach new patients. Gulfside has inpatient and other hospice service agreements with every hospital and nursing home in Pasco County. Gulfside has a very involved structure for internal improvement and regulatory compliance. There are a series of audits conducted by supervisors and others throughout its organization to ensure proper care, documentation and compliance. This type of review for performance improvement has been in place at Gulfside since 2005. Gulfside uses the services of DEYTA, a national organization, to assist it with the processing and data aggregation of its CHAPs results as part of its benchmarking for excellence. Gulfside’s commitment to quality and compliance was recognized in their last CMS and State Survey results, both of which were deficiency-free. Gulfside’s volunteer services are well-developed, allowing trained and supervised volunteers to work in administration, patient care, patient support, and even as part of the spiritual care team. Gulfside was awarded the Florida Hospices and Palliative Care Association’s Excellence Award in 2015 for its specialized Spiritual Care Volunteer Program. That program uses volunteers with spiritual or counseling training, including Stephen Ministers (lay-ministers) and retired clergy, to primarily serve patients with memory impairments, allowing the hospice chaplains to focus their efforts on patients with a more involved spiritual plan of care that might involve complicated unresolved relationships and life review. Community outreach and education and marketing efforts by hospices are important for a hospice to be part of the community. Gulfside has an extensive history of outreach programs that include educational programs for physicians and facility staff, programs to honor local veterans, and to provide education and support to caregivers, patients, and to others caring for family and loved ones with life limiting illnesses. Local fundraisers and events help keep Gulfside in touch with the community at large, in addition to raising funds which help support its mission. Gulfside’s Thrift Shop operations are part and parcel of this community presence. The thrift shop operations are a significant source of Gulfside’s operating revenues. If approved, Gulfside would focus its attention to end-stage heart disease patients, as its research showed that fewer patients with this diagnosis were currently being served in Hillsborough County. Gulfside has developed special program to serve these patients and their unique needs. The end-stage heart disease incidence rate in Hillsborough County for the Hispanic population was 25 percent, much higher than the incidence rate for the population at large of seven percent. Gulfside sees this fact as evidence of need for more focused services. Another unique trend Gulfside identified in Hillsborough County is a comparatively higher infant mortality rate when compared to the state average. In response to that identified trend, Gulfside proposed a program to meet the need for anticipatory grief and bereavement counseling for the parents and siblings of these infants and children. Gulfside currently has well-established relationships with providers in Hillsborough County, physicians, hospitals, SNFs, and conducts outreach and education as part of its mission to educate about hospice, as well as to serve the increasing number of patients its serves who are Hillsborough County residents. Gulfside agreed to a number of conditions for approval of its CON application: Condition 1 is for enhanced services to Veterans. Gulfside is a Level 4 We Honor Veterans provider. Condition 2 is for special bereavement programs and is consistent with Gulfside’s programs and includes the traumatic loss program. Condition 3 is for special programs not covered by Medicare, and these programs all compliment the patient and family hospice experience and are incorporated into how Gulfside provides care. These programs include: (a) Pet Peace of Mind program for ensuring patients and families are not burdened with additional stress worrying about the care of their pets. (b) Treasured Memories, an interactive craft-based activity to express feelings and to create a tangible reminder of the patient. (c) Heartstrings, a program using Reverie Harps to provide a soothing focus for patients and families, and include the patient playing the Harp. The Reverie Harp is a unique instrument which is auto-tuned and harmonizing; anyone can play it and make beautiful soothing music. Condition 4 provides for an Ethics Committee to assist with dilemmas and concerns for professionals and others when there is a question regarding cultural, religious, or clinical questions about the appropriateness or compatibility of a course of care or other decisions related to a patient. Condition 5 is for Gulfside’s Crisis Stabilization program which has become a significant program as troubled family dynamics and other at-risk situations seem to arise with more frequency. Condition 6 is for the Patient and Family Resource Navigator, a program already being used in Pasco County which assists patients and families to identify community and governmental benefits and resources which may be available to them and assisting them with applying or accessing the benefits or resources. Condition 7 is to provide programs for patients whose primary language is not English. This will include providing for translations and to recruit bilingual staff and volunteers. Condition 8 reflects that Gulfside is an “open access” hospice, providing complex therapies such as infusion therapies, dobutamine, special wound care, palliative chemotherapy and palliative radiation to its patients. Condition 9 was for Gulfside to offer non- cancer patient outreach and education. This includes the previously discussed end-stage heart disease and Alzheimer’s patients. Condition 10, Gift of Presence for the actively dying, will require the provision of specially trained volunteers to be present with patients and families during the last stages to assist and comfort them. Condition 11 is related to physician and clinician education, and networking programs to educate community practitioners and aligned professionals about hospice and palliative care and to provide peer-to-peer networks. Condition 12, provides for professional and physician internships and residencies, as well as the use of professional volunteers to educate about hospice and palliative care services. Condition 13 is for the development and implementation of the Patient and Family secure web-portal. Condition 14 provides that Gulfside will establish a separate foundation for Hillsborough County to help cover patient needs and expensive treatments. Gulfside will provide seed-money of $25,000 and donations will remain in Hillsborough County as part of this Condition. Condition 15 is for the rapid licensure of the new Gulfside program in Hillsborough County. Gulfside will file its licensure application to add Hillsborough County to its existing license within 5 days of receipt of the CON. Gulfside’s corporate office in Land O’Lakes and its freestanding hospice inpatient facility in Zephyrhills would be used to support the Hillsborough County program. Both are located just north of the county line. Gulfside will not need to add administrative capabilities or staff at its corporate office to initially support staff and the incremental additional patients served in Hillsborough County. The existing supports for the new program would allow it to enjoy improved economies of scale and efficiencies. Gulfside projects it will take approximately 45 days to receive a license from AHCA. During that time, existing staff will be canvassed to see which of them would like to work in the new Hillsborough County program. Gulfside would only need to assemble one additional IDT initially to begin serving the new service area. Gulfside would provide services in Hillsborough County through existing experienced staff now working in Pasco County. Travel requirements for the Hillsborough County staff would not differ much from what is commonly seen in Pasco County, because Pasco has many remote areas that Gulfside serves. Gulfside already has 25 current staff who reside in Hillsborough County. Because Gulfside is not creating a new Medicare provider or newly licensed entity in Florida, it could begin offering services as a fully-licensed and Medicare Certified provider as soon as it has a license from AHCA. All of Gulfside’s current ancillary services and supply contractors already serve Hillsborough (as well as Pasco) County and all of these contracts necessary for delivering hospice care can readily be expanded to include Hillsborough County. Gulfside will serve all of Hillsborough County through its extensive network of relationships throughout the county. Pasco and Hillsborough Counties are part of the same recognized healthcare market with patients flowing between the two counties. Gulfside expects its initial referrals will originate in the northern part of the county due to its strong referral relationships with providers in that area, and Gulfside’s assessments showed greater unmet need in that same area. It will later expand to cover the entire county. Gulfside’s operations in Hillsborough County would be more profitable on average than its current operations in Pasco County despite the allocation of administration and corporate overhead costs to the Hillsborough County program, and despite the assessment of a seven percent fee for corporate services and management from the Pasco home office. The cause of this difference is that the new program in Hillsborough County will benefit from economies of scale. Adding service volume does not require the duplication of costs and services for administrative and other support in place in Pasco County. Gulfside had a loss in fiscal year 2015 due to several significant non-recurring expenses. Gulfside’s projected budget for the 2016 fiscal year included a profit of $337,000, and Gulfside for the first four months of the new fiscal year was ahead of budget. The 2016 fiscal year budget did not include those items which Gulfside had identified as non-recurring, and yet they out-performed that conservative budget, corroborating that these were non-recurring expenses, and that Gulfside will be more profitable than projected in the 2016 fiscal year budget. Gulfside had a one-year loss for the 2015 fiscal year, but in that year, it also acquired a significant asset with the purchase of its corporate center office. Gulfside also maintained a good cash position and had significant additional credit available should it have needed to draw on those resources. LifePath’s Position vis-à-vis Competition Due to LifePath’s growth and its penetration rate within Service Area 6A, there has not been a need established by AHCA for another hospice in Hillsborough County until recently. The events leading to the newly established need are partially of LifePath’s own making, to wit: In May 2013, the Centers for Medicare and Medicaid Services (“CMS”) announced a decision to eliminate two categories of diagnosis often used for hospice care–“debility, undefined” and “failure to thrive.” The initial pronouncement from CMS indicated the change would take effect in approximately October 2013. LifePath decided to immediately stop accepting patients with those diagnoses so as to be in compliance with the new federal regulations when they took effect. LifePath also informed all its referring partners, physicians, hospitals, discharge planners, etc., that it would not be taking those types of patients any longer. Then CMS decided to delay implementation of the new policies for a year. By then, LifePath had already taken actions resulting in the loss of some 700 potential admissions. When AHCA did its hospice need calculations shortly thereafter, lo and behold, there was a “shortage” of some 700 cases in the use rate portion of the need calculation formula. As a result, AHCA determined there was a need for one additional hospice provider in Service Area 6A. LifePath had been hoisted on its own petard. LifePath does not challenge the Agency’s fixed need calculation or that another hospice should be approved for Hillsborough County Service Area 6A. Rather, LifePath is desirous that only the hospice with least potential for negative impact on LifePath should be approved. Based on the preponderance of evidence, West Florida would have the most negative impact on LifePath. Gulfside, due to its lower census development, would have the least impact. However, as Seasons would be more likely to completely meet the need projected by AHCA and would impact LifePath less than would West Florida, its proposal is the most acceptable. IV. Statutory and Rule Review Criteria The parties stipulate that: (1) All three applicants’ letters of intent and CON applications were timely and properly filed with required fees; (2) AHCA duly noticed its preliminary intent to approve West Florida’s CON application and to deny Seasons and Gulfside; (3) Seasons, Gulfside and LifePath timely filed Petitions for Formal Administrative Hearings challenging AHCA’s preliminary decision; and (4) Each application contains the minimum application content prescribed by sections 408.037 and 408.039, Florida Statutes. Also, Schedules A, D-1, and 10 in each CON application are acceptable and reasonable. Section 408.035(1) Criteria Stipulations (1)(a) “The need for the health care facilities and health services being proposed.”– -There is a need for one additional hospice program in Service Area 6A. (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.”- –A consideration of this criterion supports the need for one new hospice program in the service area. (1)(d) “The availability of resources, including health personnel, management personnel, and funds for capital and operating expenditures, for project accomplishment and operation.”– -Each applicant has adequately projected the availability of personnel. Each party’s Schedule 6 and staffing projections are reasonable. Each party’s audited financial statements present an adequate financial condition. (1)(f) “The immediate and long-term financial feasibility of the proposal.”– -Schedules 1, 2, and 3 in each application are reasonable and indicate that each applicant’s proposal is financially feasible in the short term and long term. (1)(h) –“The costs and methods of the proposed construction, including the costs and methods of energy provision and availability of alternative, less costly, or more efficient methods of construction.” - This criterion is not applicable. Florida Administrative Code Rule 59C-1.030 Stipulations: (2)(d) – “In determining the extent to which a proposed service will be accessible, the following will be considered: . . . The performance of the applicant in meeting any applicable Federal regulations.”- –This criterion would support approval of any of the three applicants. Florida Administrative Code Rule 59C-1.0355 Stipulations (6)“An applicant for a new hospice program shall provide a detailed program description in its certificate of need application . . . .”– -Each application contained adequate evidence regarding the applicants’ proposals. Factors Mitigating Against Approval of West Florida West Florida's proposal to establish a hospital-based hospice program in Service Area 6A materially differs from Seasons’ and Gulfside's proposals seeking to establish community- based hospice programs in the service area. There are key differences between a freestanding or community-based hospice, on the one hand, and a hospital-based hospice, on the other. Most significantly, in contrast to a community-based hospice, a hospital-based hospice has ready access to a patient population (i.e., acute care patients at its sponsoring hospital) from which it may receive referrals. Further, a hospital-based hospice primarily serves patients discharged from its sponsoring hospital and not the community at large, thereby creating a silo of care in which patients are funneled from the sponsoring hospital to the affiliated hospice. Nationally, for the period 2010 through 2014, hospital-based hospice programs obtained approximately 71 percent of their admissions from hospitals within their own health system and only six percent of admissions from out-of- system hospitals. Further, it is possible for a hospital-based hospice program to quickly obtain a large volume of admissions by virtue of its relationship with its sponsoring hospital. The census development for a community-based hospice program is more gradual. Hospital-based hospices do not tend to serve the broader community; once they have captured all of the admissions coming out of their own hospital or health system, they cease to continue to achieve significant market share growth. Moreover, hospital-based hospices tend to have shorter average lengths of stay and provide higher levels of inpatient care than community-based hospices because they tend to treat patients with a higher acuity and have easy access to inpatient beds where they can provide inpatient hospice care. Medicare reimbursement for general inpatient care is significantly higher than for some other types of hospice care. To the extent that a hospice provider provides more inpatient care, they will experience higher revenues. This would result in a concomitant reduction in revenues for a competing hospice in the same service area. Approximately 36 percent of patients discharged from an acute care hospital in Hillsborough County and admitted to a hospice program are discharged from one of West Florida's sponsoring hospitals. In 2014, approximately 46 percent of LifePath's admissions were referred from acute care hospitals. Accordingly, even if West Florida made no effort to obtain referrals to its program from sources other than its affiliate organizations, approximately 16.6 percent of LifePath's admissions could be at risk if West Florida's proposed project is approved. Mr. Michael Schultz, the CEO of Florida Hospital's West Florida Region, testified that the goal of Tampa General and Florida Hospital is to manage a patient's entire episode of care and that if West Florida's application were approved, both hospital organizations would "absolutely" prefer to have West Florida provide hospice care to patients discharged from its hospitals. LifePath's projection that it would lose 20 percent of its admissions if West Florida's application was approved is reasonable. Mr. Burkhart discussed West Florida’s desire to develop a “covered lives” strategy or network, where the hospital system can control how the dollars are spent and how the care is delivered. West Florida applied for a hospice CON for two reasons: 1) AHCA had published need; and 2) because “we wish to have more control over a piece of the hospice continuum so that when we’re doing things like narrow networks, we have that in our portfolio under our control.” Tr., p. 99. In a covered lives network, a hospice patient would pay less if they went to a West Florida affiliated hospice, and more if they went to Lifepath or another out-of-network hospice. West Florida plans to open satellite hospice offices in Tampa General and in the two Florida Hospitals located in Hillsborough County. There was no mention of the desire or possibility of opening satellite hospice offices in any of the non-West Florida affiliated hospitals located in Hillsborough County. From a practical perspective, it seems unlikely that competing hospital systems would welcome such involvement by a competitor. Seasons Seasons is the only applicant without a current connection to the healthcare community in Hillsborough County. It has, however, some experience in other Florida markets. Fewer of Seasons’ programmatic proposals are directly tied to a Condition of CON approval, but the programs are nonetheless generally universal in Seasons HPC operations. Gulfside Service Area 6A has a sizeable Hispanic population, but Gulfside has very limited experience in treating Hispanics. In fact, only 3.3 percent of its recent admissions are Hispanic. Gulfside’s COO did not know how many, if any, of Gulfside’s existing staff was bilingual. Today, Gulfside relies on interpreters who are accessed through a language line to communicate with Hispanic patients and family members. Since Gulfside plans to utilize existing staff to serve Hillsborough County, it will need to continue to rely upon interpreters to communicate with Hispanics in that county. To the extent the Hispanic population in Hillsborough County is underserved, or there is a need to ensure that these patients have a choice of hospice providers that are committed to meeting their needs, Seasons demonstrated far more experience and ability than Gulfside. Seasons projected 516 admissions in year two while Gulfside projected 276 admissions. Seasons has reasonably projected to achieve 240 more admissions in year 2 than Gulfside and thus will do a better job in meeting the unmet need. West Florida also projects more admissions than Gulfside. Ultimate Findings of Fact Each of the applicants, as advertised, could provide quality hospice services to the residents of AHCA Service Area 6A/Hillsborough County. The proposal by West Florida would be more likely to serve its own hospital patients than the community at large. This would have the effect of less penetration by West Florida in the service area as a whole. It would also likely result in West Florida retaining more of the most critically ill hospice patients (i.e., those with shorter lengths of stay), thereby benefitting from the new reimbursement rules to the exclusion of the competing hospice. Gulfside would be able to commence operations in Hillsborough County more quickly than Seasons or West Florida. It has connections with other healthcare providers in Hillsborough County and could easily transition to that geographic area. However, it proposes less growth and coverage than either Seasons or West Florida, thus will less likely meet the need which currently exists. Seasons has the financial and operational wherewithal to be successful in Hillsborough County. It has more experience (and success) in starting a new hospice than the other applicants. Its programs are well-established and conducted by experts in their fields. Seasons would meet the need for a new hospice provider in Service Area 6A better than the other applicants. Upon consideration of all the facts in this case, Seasons’ application, on balance, is the most appropriate for approval.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered approving Seasons Hospice and Palliative Care of Tampa, LLC’s, CON No. 10298 and denying West Florida Health, Inc.’s, CON No. 10302 and Gulfside Hospice & Palliative Care of Tampa, LLC’s, CON No. 10294. DONE AND ENTERED this 21st day of March, 2016, in Tallahassee, Leon County, Florida. S R. BRUCE MCKIBBEN 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 21st day of March, 2016. COPIES FURNISHED: Stephen K. Boone, Esquire Boone, Boone, Boone and Koda, P.A. 1001 Avenida Del Circo Post Office Box 1596 Venice, Florida 34284 (eServed) Lorraine Marie Novak, Esquire Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 (eServed) Seann M. Frazier, Esquire Parker, Hudson, Rainer and Dobbs, LLP Suite 750 215 South Monroe Street Tallahassee, Florida 32301 (eServed) Jonathan L. Rue, Esquire Parker, Hudson, Rainer and Dobbs, LLC 303 Peachtree Street Northeast, Suite 3600 Atlanta, Georgia 30308 (eServed) Karl David Acuff, Esquire Law Office of Karl David Acuff, P.A. Suite 2 1615 Village Square Boulevard Tallahassee, Florida 32309-2770 (eServed) Stephen C. Emmanuel, Esquire Michael J. Glazer, Esquire Ausley & McMullen 123 South Calhoun Street Post Office Box 391 Tallahassee, Florida 32301 (eServed) Richard J. Shoop, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 (eServed) Stuart Williams, General Counsel Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 (eServed) Elizabeth Dudek, Secretary Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 1 Tallahassee, Florida 32308 (eServed)
