The Issue Does Certificate of Need (CON) Application 10065 of VITAS Healthcare Corporation of Florida (VITAS) or CON Application 10064 of United Hospice of Florida, Inc. (United), or both, best meet the CON criteria to establish a new hospice program in Service Area 4A (Area 4A), consisting of Duval, Clay, Baker, Nassau, and St. Johns Counties?
Findings Of Fact The Parties AHCA AHCA is the state agency responsible for the administration of Florida's Certificate of Need (CON) Program. It is the only state agency with authority to issue, revoke, or deny certificates of need. VITAS VITAS is a for-profit Florida corporation presently licensed and Medicare/Medicaid certified. It is the oldest, largest, and most experienced hospice service provider in Florida. VITAS is a wholly-owned subsidiary of VITAS Healthcare Corporation (VHC). VHC is headquartered in Miami. It operates over 40 hospice programs nationwide. VHC has approximately 10,000 employees and cares for about 12,000 terminally ill patients each day. VITAS and its predecessor entities date back to the mid-seventies when Hugh Westbrook, an ordained United Methodist minister, and Esther Colliflower, a registered nurse, organized a group of hospice volunteers. In order to raise capital to expand its operations, VHC converted to for-profit status in 1992. At that time Chemed Corporation purchased a minority interest. VHC expanded greatly during the 1990s. Chemed largely funded this period of expansion. Chemed acquired 100% of VHC n 2004. The acquisition did not cause operational changes. Most of the senior management remained after the acquisition. VHC is a hospice industry leader and a socially responsible company. It has been largely focused on hospice care since its start in the late 1970s. VHC's core values are: Patients and families come first; We take care of each other; and We pledge to do our best today and even better tomorrow. VITAS’ significant involvement with the National Hospice and Palliative Care Organization’s and local ethics committees manifests its social responsibility. VITAS is also involved with Certified Pastoral Education programs. United United is a wholly-owned subsidiary of UHS-Pruitt Corporation (UHS-Pruitt), a family-owned, for-profit corporation. United provides long-term care, hospice, home health, and community based services for the elderly. United is also a socially responsible company. UHS-Pruitt, through its affiliates in United Hospice, successfully operates 25 hospice programs in Georgia, South Carolina, and North Carolina. All of the programs were start- ups as opposed to acquisitions. UHS-Pruitt is the largest provider of community nursing home services in Georgia. It is one of the largest providers of hospice services in the southeastern United States. In the early 1990s, Neil Pruitt, Sr., the founder of UHS Pruitt, determined that community nursing home services would not be the model of care delivery for the elderly in the future. He concluded that home and community-based programs such as hospice, home heath, durable medical equipment, and other alternatives to institutional care should be the company's direction. UHS-Pruitt's emphasis on home and community-based services has succeeded. Today, it provides a full continuum of health care services for the elderly, including 71 long-term care facilities, 25 hospice programs, 13 home health agencies, five pharmacies, a healthcare management company, a nutritional services company, a clinical service company, and 14 Medicaid diversion and case management programs. UHS-Pruitt subsidiaries and divisions support United's hospice operations. The subsidiaries and divisions include: (a) United Clinical, which provides clinical consultants and expertise and support services for a full range of health care professions; (b) United Pharmacy, with Doctor of Pharmacy consultants that review each hospice patient's medication regimen; (c) United Rehab, which provides physical and occupational therapies to end of life patients to improve quality of life; (d) United Medical, a full service Durable Medical Equipment and home equipment company; (e) United Home Care, offering a full range of home health services; (f) United Community Services, which provides services such as meals, outdoor activities and monthly field trips; and (g) United Care Management, which operates Medicaid nursing home diversion programs. United offers specialized programs for specific end- of-life patients and their families. Camp Cocoon, a children's grief camp open to any child who has lost a loved one, is one example. United is also the largest provider of post-acute services to veterans in the Southeast. United Veterans Services provides specialized services to veterans participating in all United Hospice programs. It also operates nine specifically certified Veterans Nursing Homes, five in Georgia and four in North Carolina. The Georgia facilities partner with the Veterans Administration to provide hospice services. Community Community is a Florida, private, non-profit corporation. Community is also a socially responsible company. It operates a full service hospice in Area 4A. Community employs approximately 800 people who provide hospice care to an average daily census of 1,100 patients and their families. Community's annual operating budget is $70,000,000. Community has one or more offices located in each of the 5 counties in Area 4A, except for Baker County. Community is Medicare and Medicaid certified. Approximately 80% of Community’s patients are Medicare patients. Medicare pays a fixed rate per day for each of the four levels of care that Medicare requires a certified hospice to deliver. During its 20-plus years of existence, Community and its volunteer board and foundation have reinvested all revenues in excess of expenses, including donations, back into patient care and serving the community in Area 4A. Community’s main office and a 38-bed hospice general inpatient and residential facility, the Hadlow Center, are located on a campus in southern Duval County to serve the most densely populated area of consolidated Jacksonville/Duval County. Community's Acosta Rua Center is a freestanding inpatient and residential facility on the West side of Duval County. Acosta Rua has 16 general inpatient beds that can also be used as residential beds. Community selected the location for Acosta Rua because it is accessible to patients from rural Baker and western Clay County and is in an area heavily populated with lower income elderly persons and African- Americans. Community located its McGraw Center for Caring, a freestanding general inpatient and residential bed facility, on the Mayo Clinic campus. This location facilitates access for patients in east Duval, northern St. John’s, and southern and southeastern Nassau Counties. Community also operates a dedicated hospice general inpatient and residential bed facility in the Pavilion at Shands Hospital in Jacksonville. Community located the facility at Shands to make it available to a large population of inner city, lower income residents who use Shands. In 2011, Community will open a dedicated general inpatient and residential bed unit at Flagler Hospital. The unit will serve patients and families in the southern part of the Service Area, southern St Johns, and south and east Clay Counties. The unit will be like all of Community’s freestanding facilities and units — homelike and designed to provide end of life care with dignity. In addition to its freestanding and dedicated inpatient and residential units, Community contracts with local hospitals for available acute care beds in the hospital, if needed. Community operates a variety of programs that provide services beyond the required minimum standards and levels of care. Examples of its programs include Community Peds Care, enhanced and extended bereavement services, veterans outreach, Camp Healing Powers for children, advanced care planning, and community professional education on end of life issues. Community operates the Neviaser Institute, on its Hadlow campus. The Institute provides professional end of life, health care, and community education to Community's staff and residents of Area 4A. Outreach programs and freestanding facilities, like Community’s, take years to develop. They involve partnerships built on trust, over the long term, with other community health care providers in Area 4A and the community. One example is the "Community Peds Care" program. The program currently serves 117 children facing end of life and their families. Community partners with the State, Nemours Children’s Clinic, the University of Florida, and Shands Hospital Jacksonville for this program. Its services go beyond hospice care. It includes perinatal planning for women at risk. The interdisciplinary, multi-provider "Community Peds Care" program is not restricted to insured or Medicaid patients. "Peds Care" in its present form took three iterations and a decade to succeed. Community spends $640,000 a year in connection with its participation in the Community Peds Care partnership. Community is the only hospice provider in Area 4A that operates freestanding hospice inpatient and residential facilities and dedicated units on hospital campuses, staffed exclusively by hospice personnel. Community’s inpatient and residential facilities and units also provide homelike accommodations (residential beds), on a sliding fee scale, for hospice patients who are temporarily or permanently homeless and are receiving the routine home care level of hospice care. Community has put its financial capital at risk to create program enhancements with an understanding that competition in the market, for the finite set of hospice patients in Area 4A, would increase every time a new provider is added. Community was aware that CON regulations permitted approval of new hospice providers when application of the regulations resulted in the "need" for a new provider. Community was also aware that the regulations permitted approval of a new provider in "not normal" circumstances, even if the "need" rule did not project the need for a new provider. Overview of Hospice Services Florida and federal laws and rules require hospice programs to provide a continuum of palliative and supportive care for terminally ill patients and their families. Palliative care generally refers to services or interventions that are not curative but are provided for the reduction or abatement of pain and suffering. Under Florida law, a terminally ill patient may qualify for hospice care if his or 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 Benefit if the patient's life expectancy is six months or less. A provider must make hospice services available 24 hours a day, seven days a week. The services provided must include nursing, social work, pastoral care or spiritual counseling, dietary counseling, and bereavement counseling. A hospice may provide physician services directly or through contract. Hospices must provide four levels of hospice care: routine, continuous, in-patient and respite. A hospice provides services to a patient and family either directly or by others under contractual arrangements with a hospice. A hospice may provide services in a patient's temporary or permanent residence. If the patient needs short-term institutionalization, the hospice provides services in cooperation with contracted institutions or in a hospice inpatient facility. Routine home care makes up 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 practical 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 nondomestic 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. The hospice program is responsible for coordinating and ensuring the delivery of hospice care and services to the person consistent with statutory and rule requirements. The inpatient level of hospice care provides an intensive level of care within a hospital setting, a skilled nursing unit, or in a freestanding hospice inpatient facility. Inpatient care is a short-term adjunct to hospice home care and home residential care. It should only be used for pain control, symptom management, or respite care in a limited manner. In Florida, the total number of inpatient days for all hospice patients in any 12-month period may not exceed 20% of the total number of hospice days for all the hospice patients of the licensed hospice. Continuous care is basically emergency room or crisis care. It may be provided in a home care setting or in any setting where the patient resides. Continuous care, like inpatient care, was designed to be provided for short periods of time, usually when symptoms become severe and skilled and individual interventions are needed for pain and symptom management. Continuous care is the costliest care for payors and has the lowest profit margin for providers. Respite care is for caregiver relief. It allows patients to stay in hospice facilities for brief periods to provide breaks for their caregivers. Respite care is typically a minor percentage of overall patient days. Medicare reimburses the different levels of care at different rates. The highest level of reimbursement is for continuous care. Medicare covers payment for approximately 85% to 90% of hospice care. The goal of hospice is to provide physical, emotional, psychological, and spiritual comfort and support to a terminally ill patient and the patient's family. Hospice care focuses on palliative care and comfort measures. Hospices provide services according to a plan of care developed by an interdisciplinary group of physicians consisting of nurses, social workers, and various counselors, including chaplains. Individual hospice patients sometimes benefit from services that are not 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 helpful for severe pain control and symptom control. Community provides, and both VITAS and United propose to provide, all of the core hospice services and many of the other services mentioned above to patients. Fixed Need Pool AHCA'S hospice rule includes a numeric need formula for determining the need for an additional hospice program in a Service Area. See, Fla. Admin. Code R. 59C-1.0355(4)(a). The Agency's formula uses an average three-year historical death rate. It applies this average to an area's forecasted population for a two-year planning horizon to project the number of deaths in the area. Then the formula uses a statewide hospice use penetration rate. This is the number of hospice admissions divided by current total 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. By applying the penetration rates to the projected numbers of death in each category in an area, the rule formula projects hospice admissions (based on death rate and projected population growth) in each category. The most recent published actual admissions are subtracted from the projections 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 "needed," unless there is a recently approved hospice in the service area or a new hospice provider has not been operational for two years. In this case, application of the numeric need rule projected a "need" for one additional hospice in Area 4A. Subtracting the most recently reported published hospice admissions in Area 4A from the projected number of likely hospice admissions calculated by applying the penetration rates to the projected deaths in Area 4A indicated that there would be 925 more projected admissions than there had been for the period for which the admissions were published. The hospice service use rate in Area 4A has consistently been below the statewide average use rate for the past ten years. Area 4A Area 4A consists of five counties. The central and most heavily populated county is Duval. It includes the urban center of Jacksonville and its population of approximately 860,000 people. Clay and St. Johns County each have approximately 186,000 residents. Nassau County is north of Duval. Part of Nassau County is considered part of the Jacksonville metropolitan area. There are resort and retirement communities along the east coast of Nassau County. The western part of Nassau County is less densely populated and rural. The fifth county, Baker County, is west of Duval County. It is the only state-designated rural area in Area 4A. Baker County's small population is largely concentrated in the southeast quadrant of the county. A large part of the county is part of the Okefenokee Wildlife Refuge. Baker County has the lowest hospice admission rate of any county in Area 4A. None of the existing providers have an office in Baker County. Approximately 72% of Area 4A's population is Caucasian. Approximately 22% of the area's population is African-American. Community has served Area 4A for approximately 30 years. It accounts for approximately 90% of all hospice admissions in the area. In the most recent year for which figures are published, Community had 5,216 admissions. Haven Hospice began operating in Area 4A in 2001. It has an approximately 8% market share and 481 admissions annually. Heartland Hospice opened in 2007. In the most recent 12 month period for which there are published figures, Heartland served 108 patients. The Proposals VITAS and United propose to provide hospice patients in Area 4A with all of the core services and many of the other services mentioned above. The proposals are similar in many respects. Both will provide quality services and propose financially feasible programs. Either applicant could serve Area 4A well if approved. Either applicant would serve the "need" projected by AHCA. Both applicants emphasize what they describe as "underserved" African-American populations and rural populations. Each applicant maintains that its plan for serving these populations is a primary reason to approve its application. "Underserved" is not an accurate description. There is no persuasive evidence that African-American or rural patients in Area 4A who desire hospice services do not have timely access to them. The populations each use hospice services at a lesser rate than Caucasian or urban and suburban populations. But nothing indicates that this is because the services are not available. African-American utilization of hospice services in Area 4A is lower than utilization by the Caucasian population. This is not unique to Area 4A. Lower hospice utilization by African-Americans is common throughout the nation. Nothing indicates that the lower hospice utilization by African- Americans in Area 4A is not normal. To the contrary, the credible evidence establishes that this is the normal state of affairs. Each applicant also identifies a need to serve more non-cancer patients and serve more patients in need of continuous care. There is no persuasive evidence that non- cancer patients or patients needing continuous care in Area 4A who desire hospice services do not have timely access to hospice services. United also maintained that homeless persons with terminal illnesses were individuals who needed more hospice services. There is no persuasive evidence that homeless individuals in Area 4A who desire hospice services do not have timely access to them. Each applicant advances secondary arguments about features of its operations that make it superior to the other. Each applicant acknowledges, as the evidence established, the quality of the other applicant. The applicants make limited criticisms of the reasonableness of each other's proposals. The distinctions between the applicants' proposals are relatively fine and are discussed later. The VITAS Proposal VITAS proposes to establish a main office in Duval County with satellite offices in Baker and Nassau counties. It will open the Baker County office the first year of operation. VITAS projects equipment costs of $170,000 and start- up costs of $83,500. The projections are reasonable. VITAS projects 162 admissions in Year 1 and 297 admissions in Year 2. The projections are conservative and reasonable, especially in light of the market dominance of Community. VITAS' own start-up experience in Brevard, Collier, Volusia, and Flagler counties also supports the reasonableness of the utilization projections. VITAS is able to recruit staff. Its proposed staffing levels and salaries are reasonable. Factors considered in assessing reasonableness include ratios of census to discipline and the number of core employees that will be needed. The proposal of VITAS budgets sufficient funding for physician services and contracted services. VITAS's total projected costs for the proposal are $338,353. This projection is reasonable. VITAS's proposal satisfies both the Local Health Planning Council's general preferences and its hospice specific preferences. VITAS complied with all applicable AHCA rules and preferences. VITAS has well-developed and effective information technology systems that help it deliver hospice services efficiently over large geographic areas. It will use these systems in its proposed Area 4A hospice. VITAS made a number of enforceable commitments in the proposed conditions for the Area 4A hospice. VITAS commits to the following: -Minimum of 3% total patient days to persons in need of continuous care -Minimum of 65% patients with non- cancer diagnoses -Exceed statutory pain control outcome measures -Death attendance of at least 90% of deaths -Patient-family satisfaction score of 90% or greater -Discipline specific satisfaction of 90% or greater -Provide pet therapy -Establish satellite offices in Baker and Nassau Counties -Implement TeleCare Program with 24/7 nurse availability -Establish Local Ethics Committee -Implement CarePlanIT a handheld bedside clinical information system -Provide palliative radiation, chemotherapy, and transfusions where appropriate -Provide hospice services 24/7 as indicated by patient’s medical condition -Patient assessment by physician upon admission -Medical Directors must be board certified in Hospice or Palliative Care medicine within 5 years of employment -RNs encouraged to become certified in Hospice and Palliative Care nursing; with 50% of all supervisory nurses attaining such certification by second year of operation -Chaplains will be Masters of Divinity, from accredited CPE program -Social workers will be Master’s level or Licensed Clinical Social Workers -Designate hospice representative to provide community outreach, promote hospice awareness, and enhance access to African- American individuals in Service Area 4A -A Physician will serve as member of every care team -VITAS will provide bereavement services beyond the normal one year after death of patient, if needed -VITAS will not solicit or accept donations from hospice patients, their families, or the general community -Immediately establish a Clinical Pastoral Education program In addition, VHC (the parent of VITAS) will provide: -A charitable contribution of $300,000 to Florida State College of Jacksonville to fund an Endowed Teaching Chair, Scholarships and the Northeast Florida Initiative for Nursing Workforce Diversity; -A charitable contribution of up to $500,000 to the United Way of Northeast Florida, during the first three years of licensure; -A charitable contribution of $50,000 to the Jacksonville Urban League to expand health and quality-of-life initiatives in the greater Jacksonville area. Florida State College of Jacksonville is the second largest state college in Florida. It has a full array of health programs from entry level to bachelor’s degree. The college produces more nursing graduates than all other colleges and universities in the region combined. The fundraising arm of Florida State College is the Florida State College Foundation. Its sole purpose is supporting the college by raising money to support academic programs and help develop facilities. One component of the VITAS/Florida State College Foundation Hospice Care Partnership Proposal is linked to factors that affect African-American utilization of hospice care. That is the $130,000 contribution to support Florida State College's operation of a Northeast Florida Initiate for Nursing Workforce Diversity. The initiative strives to increase the number of registered nurses from disadvantaged or under represented backgrounds and ensure all citizens have access to culturally, ethically and linguistically appropriate health services. This addresses two factors identified as contributing to lower utilization of hospice services by African-Americans. The remaining components of the $300,000 VITAS proposal are not directly related to factors affecting African- American hospice utilization. VITAS's proposed measure of fulfillment of this commitment is only a signed statement by VITAS and evidence of funds transferred. VITAS proposes a donation of $500,000 to the United Way of Northeast Florida. United Way’s mission is to identify critical issues in the community, perform a needs assessment, and then raise the dollars to address those issues. The organization serves Duval, Clay, Nassau, Baker, and northern St. Johns Counties. The United Way partners with two area hospitals, Baptist Medical Center and Shands of Jacksonville. Shands has a contract with the City of Jacksonville to provide care for indigent and low income persons. It is the largest provider of health services to the indigent in the area. The United Way will use VITAS's donation to expand its elder care advocacy program and to develop better support for caregivers. Through the United Way’s partnership with Shands, donations by VITAS will reach the community’s homeless population. VITAS’ funding would also support United Way’s ?Life: Act 2.? This is a seniors initiative focused on assisting working caregivers, predominantly minority families with low and moderate incomes, to access information and support services, including end of life services. The mission of the Jacksonville Urban League is to assist African-Americans and others achieve social and economic equality. It serves Duval, Nassau, Baker, and Clay Counties, as well as a portion of South Georgia. VITAS commits to a $50,000 grant to the Jacksonville Urban League if approved. The grant addresses the fact that African-Americans utilize hospice services at a lower rate than Caucasians. The Jacksonville Urban League committed to spend $15,000 of the $50,000 grant on expanding community health and end-of-life awareness initiatives offered under the League's African-American Health Network. It also committed that $3,500 would provide educational components about end-of-life care and advance directives as part of quarterly Health and Quality of Life seminars and workshops. The remaining $31,500 is earmarked as follows: $10,000 -- four quarterly community education workshops conducted by a nutritionist focusing on healthy cooking and healthy eating; $12,000 -- sponsorship of the Jacksonville Urban League Centennial Celebration Walk-A-Thon community fund-raiser; $5,000 -- promotion for an employee/community walking program with a goal of each participant walking at least 100 miles during the year as part of the Urban League Centennial Celebration; and $4,500 -- individual incentives for people who sign up for various programs and meet specific goals. VITAS proposes only a signed statement by a VITAS representative and evidence of payment to the Jacksonville Urban League as measurement of fulfillment of the condition. VITAS has been actively involved in the Foundation for Hospices in Sub-Saharan Africa (FHSSA) since 1998. The FHSSA is a national initiative of the National Hospice and Palliate Care Organizations (NHPCO). VITAS is its leading participant, providing both monetary and clinical support over the years. Robin Fiorelli, Senior Director of Bereavement Volunteers for VHC, sits on the FHSSA Board. VITAS participates in FHSSA because that is part of its philanthropic mission. The United Proposal Like VITAS, United relied in its application upon AHCA's projected need for a hospice in Area 4A. United's letter of intent and its application did not propose approval of two programs, one based on the need projection and one based upon special or "not normal" circumstances. United advanced that proposal for the first time in this proceeding. United proposes to establish a main office in Jacksonville and satellite offices in rural Baker and Nassau Counties. United projects admissions of 222 in its first year of operations and 702 in its second year of operations. United's projected increase in second year admissions relies upon its plan to develop home health services in the area if it obtains the certificate of need. United plans to bring its allied services and programs to the area if approved. But none are presently provided in the area. United's second year projections are aggressive but not unreasonable in light of AHCA's projected 925 additional hospice admissions. In any event, United can be reasonably expected to achieve or exceed the same utilization as that projected by VITAS. United projects equipment costs of $170,000, project development costs of $84,853, and start up costs of $83,500. These are reasonable projections. United's total projected costs of $338,353 are reasonable. United's proposal will be financially feasible. It will be financially feasible even with lower utilization than projected. This is because the costs of operation are primarily staffing, which is a variable expense directly related to utilization. The ?break even? point for United is 360 admissions. Thus, even if admissions were reduced dramatically from United’s Year 2 projections, the United proposal remains financially feasible. UHS Pruitt will fund the proposed United project. United, with the support of UHS Pruitt, has the financial resources to fund, accomplish, and operate its proposed hospice program at the cost stated in its CON Application. UHS Pruitt has well-developed recruitment, training and education programs. It operates the Pruitt Online University, with numerous education modules available for each specific discipline in a patient care team. Additionally, United’s parent organization operates a state-of-the-art training and education center at its corporate headquarters in Norcross, Georgia, where it routinely conducts orientation and continuing education classes. The facility is equipped with video conferencing capabilities, multiple classrooms and lecture halls. United will use these resources to establish and operate its proposed hospice program. United will be able to appropriately staff and operate its proposed hospice program. Like VITAS, United is an established provider of high- quality hospice services. United also conditions its CON on becoming accredited by the Community Healthcare Accreditation Program (CHAP), an outside accreditation body. This will help United ensure that it provides high quality care. United commits to several conditions upon its CON. They are: -UHS Pruitt will make all of the services that it provides available to any hospice provider that wishes to contract for the services. This includes services from United Home Care, United Medical, United Pharmacy Services, and United Clinical Services. -A staff member will be responsible for outreach initiatives to the African-American community. -Form an African-American Community planning and outreach team -United will host listening sessions with African-American leaders, African- American clergy and other members of the African-American community -Based on the listening sessions United will develop message, presentation, and marketing materials addressed to the African-American community -Continually assess existing tools and obtain or develop new resources to provide culturally meaningful and appropriate educational opportunities for the African- American community -Provide ongoing comprehensive training for staff and volunteers involved in the outreach program -Develop and maintain a calendar of events that address, support, and celebrate African-American issues, heritage, and healthcare concerns. Staff members will attend the events -Develop a tool to track referrals generated by the outreach program to measure its effectiveness. -Report admissions annually by race to AHCA -Continue active membership in the Emergency Services and Homeless Coalition (ESHC) of Jacksonville, Inc., a non-for- profit alliance of organizations dealing with homeless issues. -Provide hospice services to the homeless in shelters and help with placement -Provide health screening by a registered nurse once a month at a local social service organization chosen in collaboration with the ESHC -Open a centrally located Baker County office immediately upon licensure -Open a centrally located Nassau County office by the end of the second year of operation -Join the St. Johns Rural Health Network -Provide a minimum of 2.5 % of patient days in continuous care by the end of year two -Obtain CHAP accreditation -Join Florida Hospice and Palliative Care, Jacksonville Regional Chamber of Commerce, St. Johns County Chamber of Commerce, Clay County Chamber of Commerce, and Baker County Chamber of Commerce -Make the four annual $2,000 scholarships offered by United Hospice Foundation available to Florida residents. -Meet or exceed all NHPCO Guidelines for qualifications and staffing ratios of patient care staff -Implement rapid pain management protocols to ensure 75% of patients who report severe pain will report a reduction to 5 or less by the end of the second day of care. Statutory and Rule Review Criteria Rule Preferences AHCA 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. Commitment to serve populations with unmet need Both applicants propose to serve populations that they maintain have an unmet need for hospice services. Those populations are African-Americans, rural residents, and the homeless. The evidence does not establish an unmet need for hospice services for these populations in the sense of people desiring hospice services not being able to obtain them. The evidence establishes that these populations use hospice services at a lower rate than other populations. What the applicants really propose is outreach and marketing of various sorts to increase utilization by these groups. AHCA's apparent health policy and planning goal is to increase utilization by these groups. VITAS and United proposed offices in rural areas. Their plans to increase utilization by rural residents are comparable. One is not better than the other. Both proposals include efforts to improve utilization by the homeless. Neither is superior to the other. Similarly both applicants make plausible and equivalent proposals to increase hospice utilization by non- cancer patients and people needing continuous care (3% for VITAS and 2.5% for United). Neither is superior to the other. Both applicants commit to outreach to the African- American population. Both have a history of serving African- Americans and plans to reach out to the African-American Community. VITAS also has a history of working with the community to increase awareness of end of life options. Finally, VITAS has a more concrete and expansive plan to increase African-American utilization. VITAS's commitments to make donations to the Jacksonville Urban League, the United Way, and Florida State College are specifically linked to activities that designed to increase awareness of hospice services and improve comfort with the idea of hospice in the African-American Community. This specificity and VITAS's history of engagement in the issue of hospice services for African-Americans make its proposal the better one for increasing African-American utilization of hospice services. Commitment to provide in-patient care through contracts with existing health care facilities VITAS and United intend to use scatter beds to provide in-patient care. Both intend to contract with existing health care providers. Commitment to serve patients who do not have primary caregivers at home; the homeless; and patients with AIDS The applicants make equivalent commitments to serve these patients. Commitment to provide services not covered by insurance, Medicare or Medicaid VITAS and United each have a history of providing services not covered by insurance, Medicare, or Medicaid. Both propose to do so in their applications. There proposals on this subject are equivalent. Consistency with plans; letters of support Both applicants provided letters of support demonstrating their outreach to the community and sufficient support within the community. Neither is superior in this factor. Similarly, both applicants demonstrated that their proposals are consistent with the needs of the community and other criteria contained in local and state health plans. Required Program Description VITAS and United provide detailed program descriptions in their CON applications. Both establish reasonable staffing, referral sources, projected admissions, volunteer recruitment, community education, and bereavement services. Although there are differences between the proposals, there is no significant distinction between the two in the quality or feasibility of the proposed programs. Section 408.035(1)(a), Florida statutes -- The need for the health care facilities and health services being provided AHCA projected a need for one new hospice program in Area 4A. There are no special circumstances in Area 4A that would justify adding a new program in the absence of a calculated need. Section 408.035(1)(b), Florida Statutes -- availability, quality of care, accessibility, and extent of utilization Existing providers offer quality and accessible hospice care to the residents of Area 4A. Each applicant can serve the need projected by AHCA. VITAS and United each would provide quality care to the area. It is unlikely, given the utilization rate in Area 4A and the market dominance of Community, that all of the hospice admissions projected will go to the new provider. However, each applicant is capable of satisfying the projected need. Section 408.035(1)(c), Florida Statutes -- ability to provide quality of care and record of providing quality of care VITAS uses over 40 Quality Assurance Performance Improvement measures and reports from them that help it provide high quality care. VITAS has and uses guidelines for intensive palliative care for both internal and external use. The guidelines outline how to approach and manage symptoms pharmacologically and non-pharmacologically. VITAS's medical director will be a direct employee of VITAS. In March of 2010, AHCA cited VITAS's Palm Beach hospice for deficiencies related to, but not causing or hastening, a patient's death. This was an isolated error. Because of a time lag in updating the patient records, the patient was discharged when she should not have been. AHCA made a finding of immediate jeopardy. VITAS responded promptly and correctly with a plan of correction that AHCA accepted. Since then the Palm Beach VITAS program has passed its bi-annual licensure survey. AHCA has also accepted other corrective action plans for unrelated VITAS deficiencies. Given the size of VITAS's operations, the number of people it serves, and VITAS's prompt attention to the deficiency, this incident does not indicate material problems with VITAS's quality of care. United has extensive internal quality assurance and performance improvement programs. United Clinical Services provides consulting services to all of United's hospices from an interdisciplinary care team. United also conducts surveys and audits of United's hospice program. That is one way United ensures quality care for its patients. United also conditioned its Certificate of Need on becoming accredited by the Community Healthcare Accreditation Program. This is an outside accreditation body. United will employ Medical Director services by engaging a physician under contract. Both applicants have a history of providing quality hospice services. Each demonstrated the ability to provide high quality care. VITAS and United each employ qualified people and provide them all needed training. Both applicants proposed appropriate staffing for their programs and good quality control and review practices. Neither applicant's proposed quality of care is superior to the others. They are equivalent. Section 408.035(1)(d), Florida Statutes -- availability of resources, including health personnel, management personnel, and funds for project accomplishment and operation United has adequate financial resources to establish and operate its proposed hospice program. Its parent company is committed to providing the full amount of project costs and is able to fulfill that commitment. VITAS also has adequate financial resources to establish and operate its proposed hospice program. Its parent company is committed to funding the community contributions that VITAS includes in its proffered conditions. Both applicants have the necessary personnell resources available to start and operate their programs. Section 408.035(1)(e), Florida Statutes -- extent to which proposed services will enhance access to health care for residents of the service district None of the existing providers have an office in Baker County. VITAS and United propose to establish an office in Baker County. This will improve the availability of hospice services to rural residents. Between the two applicants, neither proposal to increase availability to rural residents is superior to the other. The applicants and AHCA agree that increasing the low African-American utilization rate is an important goal. There is no persuasive evidence, however, that the lower rate is due to a lack of access to hospice services. The low rate results from a combination of historical distrust of the medical system; reliance upon family, church, and community during a patient's final days on earth; and difficulties with access to health care in general. Both applicants commit to reach out to African- Americans and work with leaders in the community to increase utilization of hospice served. Their commitments include making outreach a primary responsibility of a designated employee. VITAS, through its parent company, has a substantial record of working closely with and supporting the African- American community. Diane Deese, Director of Community Affairs for VHC, works with all minority communities. She works predominately with African-American and Hispanic organizations. Ms. Deese works with the boards and executive leadership of groups and organizations such as the National Medical Association, the largest African-American physician organization in the U.S.; the National Federation of Licensed Practical Nurses; Rainbow/PUSH; the Samuel DeWitt Proctor Conference; and the Full Gospel Baptist Church Fellowship International. The New Orleans Chapter of the National Black Nurses Association asked VHC to help in providing education and support for its nurses, although VITAS has no licensed program in the area. VITAS helped. Since 2003, VITAS has been the only hospice provider actively involved with the National Medical Association. On behalf of VITAS, Ms. Deese works closely with the president of the National Black Nurses Association, as well as with the organization’s Daytona Beach Chapter. Both wrote letters of support for the VITAS proposal. The National Black Nurses Association has a chapter in Jacksonville. For many years VITAS has supported informing African- Americans about hospice care through its engagement with The Duke Institute on Care at the End of Life, a program of the Duke Divinity School. The program was established with a founding gift from Hugh Westbrook (VITAS founder), VHC, and the End of Life Foundation. Crossing Over Jordan is one of the educational programs of the Duke Institute. The Institute created the program to focus on the role of African-American churches in supporting terminally ill members of their congregations. The Full Gospel Baptist Church Fellowship International is a group of predominantly African-American clergy who have worked with the Crossing Over Jordan conferences to educate communities, particularly African-American communities, about hospice and end-of-life care. The Full Gospel Baptist Church Fellowship International has several ministries in Jacksonville, Florida. It has worked with VITAS to educate African-American church congregations about the benefits of hospice and to encourage members to volunteer. The Samuel DeWitt Proctor Conference is a group of African-American pastors. The group leads a number of large and influential churches around the country that have entered into a partnership with the Duke Institute on Care at the End of Life to help it spread the word about the need for African-Americans to know more about hospice and palliative care options for end- of-life care. United has a record of providing hospice services to African-Americans. Overall in 2009, United provided 26% of its hospice patient days to African-Americans in 2009. In communities with large African-American populations similar to Duval, United provided in excess of 46% of its patient days to African-Americans. In 16 of its 25 hospice programs, 26% or more of United’s hospice admissions were persons of African-American descent. In five of United's hospice programs, African- Americans accounted for more than 40% of admissions. United is committed to increasing access to hospice services for African-Americans. Claudia Warren-Wheat is a Clinical Social Worker with United Clinical. She assists the United Hospice programs in the social work and community outreach functions. Ms. Warren Wheat coauthored an article published in the Journal of the National Association of Social Workers examining barriers to access for hospice use by African- Americans entitled "Hospice Access and Use by African-Americans: Addressing Cultural and Institutional Barriers through Participatory Action Research" (Nov. 1999). This Article includes recommendations for dismantling barriers to access to hospice care for African-Americans. United's plan to increase African-American utilization of hospice services includes developing a census tracking tool to routinely track referrals generated by the outreach program to measure its success. Section 408.035(1)(f), Florida Statutes -- immediate and long-term financial feasibility VITAS’s operating cash flow will fund the proposed project cost of $338,000. It is more than adequate to cover the VITAS's project costs. VITAS is an existing hospice provider in Florida and in sound financial condition. VITAS's parent, VHC, will fund the project's charitable contribution commitments. The VITAS proposal is financially feasible in the short-term and long-term. The VITAS pro forma was derived from the same financial model it has used successfully for years. The assumptions used by VITAS for revenues and expenses are reasonable and achievable. Its existing operations in Florida provide sufficient net income and cash flow to ensure the project’s financial success. VITAS’ projected utilization is conservative and is both reasonable and achievable. United has a successful history of establishing new hospice programs. It too has the resources to establish and operate the proposed program. If United does not achieve its projected utilization and linked revenue in the second year of operation, that will not impair its financial feasibility. United can adjust staffing as needed. And United is likely to achieve the utilization needed to "break even. The United project is financially feasible in the short and long term. Section 408.035(1)(g), Florida Statutes -- extent to which proposal will foster competition that promotes quality and cost- effectiveness Both applicants are capable, established hospice service providers with the backing of experience and committed parent companies. Either applicant will foster competition with the existing providers in all arenas including quality and cost effectiveness. Section 408.035(1)(h), Florida Statutes -- costs and methods of construction, etc. Neither applicant proposes construction as part of its proposal. Section 408.035(1)(i), Florida Statutes -- the applicant's past and proposed provision of health care services to Medicaid patients and the medically indigent The applicants present comparable records of providing services to Medicaid and medically indigent patients. VI. Ultimate Findings of Fact Both applicants would provide quality care to their patients. Neither is demonstrably superior to the other. Both applicants will improve access of rural and homeless residents of Area 4A. Neither is demonstrably likely to improve access more than the other. Both applicants propose financially feasible projects. There are no "not normal" or "special" circumstances related to the need for hospice services in Area 4A. Both applicants are committed to and capable of providing care to non-cancer patients. Neither has a demonstrably superior plan for doing this. Both applicants are committed to and capable of providing continuous care to those who need it. Neither has a demonstrably superior plan for doing this. VITAS's plans for increasing utilization by African- Americans, in light of its conditions, are more likely than those of United to improve African-American utilization.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law it is, RECOMMENDED that the Agency for Health Care Administration issue a Final Order denying the application of United Hospice of Florida, Inc., and granting VITAS Healthcare Corporation of Florida, Inc., a Certificate of Need to establish a hospice program in AHCA Service Area 4A with the conditions stated in VITAS's Certificate of Need Application. DONE AND ENTERED this 22nd day of March, 2011, in Tallahassee, Leon County, Florida. S John D. C. Newton, II 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 22nd day of March, 2011.
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 In the first batching cycle of 2006, Hospice of the Palm Coast, Inc. ("Palm Coast") and Catholic Hospice, Inc. ("Catholic Hospice"), applied to the Agency for Health Care Administration ("AHCA" or the "Agency") for a certificate of need to establish a new hospice program in Broward County. Palm Coast's application number is CON 9931; Catholic Hospice's is CON 9928. The issues in this case are whether either, both or neither of the applications should be approved.
Findings Of Fact The Parties AHCA "[D]esignated as the state health planning agency for purposes of federal law," Section 408.034(1), Florida Statutes, AHCA is responsible for the administration of the CON program and laws in Florida. See § 408.031, Fla. Stat., et seq. As such, it is also designated 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. Catholic Hospice Catholic Hospice, Inc., has been a licensed provider of hospice services in Miami-Dade and Monroe Counties (Hospice Service Area 11 which adjoins Service Area 10 along the Broward/Miami-Dade County line) since 1988. It is faith-based and mission-driven; in keeping with its nature as such, it is a section 501(c)(3) not-for-profit corporation. Catholic Hospice has two corporate members: the Archdiocese of Miami and Mercy Hospital, a part of Catholic Health East. Neither of its two members provide it with funding. Catholic Hospice is governed by a board of directors with autonomous authority to govern its activities. The members of its board live and work in the local community. Palm Coast Palm Coast is a not-for-profit Florida corporation currently licensed to operate hospice programs in Hospice Service Area 4B and, like Catholic Hospice, in Hospice Service Area 11 (Miami-Dade and Monroe Counties). Palm Coast's provision of hospice services in Service Area 11 is new relative to Catholic Hospice's service for nearly 20 years in the service area. Palm Coast has been licensed as a hospice in Service Area 11 since March 2006. Palm Coast is a wholly-owned subsidiary of a its management affiliate and parent organization, Odyssey HealthCare, Inc. ("Odyssey"), which is a for-profit national chain of hospices. The sole member of Palm Coast is Odyssey HealthCare Holding Company, Inc., a wholly-owned subsidiary of Odyssey. Palm Coast's Board of Directors are managers of Odyssey all of whom live and work in or near Dallas, Texas. Numeric Need for a Service Area 10 Hospice Program Hospice Service Area 10 Hospice Service Area 10 consists of Broward County. Referred interchangeably by the parties at hearing as either Service Area 10 or Broward County, Hospice Service Area 10 will also be referred to in this Order as either Service Area 10 or Broward County. AHCA's Determination of Numeric Need To determine need in Service Area 10 in the "Other Beds and Programs" First Batching Cycle 2006, AHCA employed the numeric need methodology found in Florida Administrative Code Rule 59C-1.0355 (the "Hospice Programs Rule"). The Agency's methodology calculates need using a number of factors. Among the factors are four categories of deaths in the service area: U65C, 65C, U65NC, and 65NC, described by the rule as follows: (a) Numeric Need for a New Hospice Program * * * U65C is the projected number of service are resident cancer deaths under 65 . . . 65C is the projected number of service area resident cancer deaths age 65 and over . . . U65NC is the projected number of service area resident deaths under age 65 from all causes except cancer . . . 65NC is the projected number of service area resident deaths age 65 and over from all causes except cancer . . . Fla. Admin. Code R. 59C-1.0355(4). (Consistent with these four factors, data was introduced at hearing that is discussed further in this order that relates to four categories of patients grouped by diagnosis and age in much the same way: "65 and Over Cancer," "65 and Over Non-cancer," "Under 65 Cancer," and "Under 65 Non-cancer." See paragraph 16, below.) According to the Hospice Programs Rule, "[n]umeric 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." Id. Application of the Agency's methodology to the factors relative to Service Area 10 yielded more than 400 projected unserved patients who would elect a hospice program ("Net Need"). Palm Coast presented a hybrid methodology that yielded a Net Need of 1,340. In Palm Coast's view, the Net Need produced by its hybrid methodology demonstrated need for at least two new hospice programs. The Agency, however, interprets the Hospice Programs Rule to allow only one new hospice program to be added in any one batching cycle no matter what number is yielded by its methodology. True to its calculation of numeric need and its interpretation of the rule, the Agency duly published its fixed need pool of one. The fixed need pool was not challenged. In response to the published need, Catholic Hospice and Palm Coast submitted timely applications for approval of a new hospice in Broward County. In its State Agency Action Report ("SAAR"), AHCA approved Catholic Hospice's application and denied Palm Coast's. Overview and Approaches of the Applications The applications of Catholic Hospice and Palm Coast comply with the application content and review requirements in statute and rule. Both applications include information related to "special circumstances" that would justify approval of a hospice program in the absence of numeric need. Catholic Hospice, however, did not attempt to demonstrate the existence of "special circumstances" at hearing. Palm Coast, on the other hand, attempted to show that more than one new hospice program could be approved in Broward County. Palm Coast's case for approval of more than one hospice program has two bases. The first is justification under the Special Circumstances provisions art of the Hospice Programs Rule found in Subsection (4)(d) of the rule. The special circumstances advanced by Palm Coast are discussed below in paragraphs 138 to 140. The second base is the "hybrid need methodology" discussed above and developed by its expert health planner. Palm Coast's Hybrid Need Methodology Palm Coast's hybrid methodology follows the assumptions of AHCA's methodology in three categories based on age and diagnosis: "Under 65 Cancer," "Under 65 Non-cancer," and "65 and Older Cancer." It differs from AHCA's methodology in that it assumes that penetration in the "65 and Older Non- cancer" population will remain stable. Palm Coast's "hybrid" need methodology suggests that the need in Service Area 10 is greater than the need forecast by AHCA's approved methodology. The hybrid methodology yields a net need of 1,320 admissions rather than the 441 projected by the Agency's methodology. Stipulated Facts Prior to hearing, the parties filed a joint pre- hearing stipulation.1 In Section E.,2 of the document, entitled "Statement of Facts Which Require No Proof," the parties stipulated to following facts: [a.] Section 408.035, Florida Statutes (2005) sets forth the statutory CON review criteria at issue in these proceedings. The parties agree that the following subparagraphs of Section 408.035, Florida Statutes (2005) are either not applicable or not at issue to consideration of the application: (8) and (10); [b.] The Parties agree that the CON review criteria and standards applicable in this proceeding are set forth in Section 408.035, Florida Statutes (2005), and Rules 59C- 1.0355 and 59C-1.030, Florida Administrative Code. The parties agree that the following criteria in Rule 59C-1.0355, Florida Administrative Code, are either not applicable or not at issue to consideration of the application: (7), (8), (9), and (10); [c.] The parties agree that CATHOLIC HOSPICE and PALM COAST's Letter of Intent (hereinafter referred to as "LOI") and CON applications were timely filed with the Agency. [d.] The CON Applications filed by CATHOLIC HOSPICE and PALM COAST comply with the Application content and review process requirements of Sections 408.037 and 408.039, Florida Statutes (2005) and Rule 59C-1.0355, Florida Administrative Code, and the Agency's review of the Application complied with the review process requirements of the above-referenced Statutes and Rule. [e.] A FNP of one (1) was projected and published for Hospice Service Area 10 for the 2006 - 1st Batching Cycle in the Florida Administrative Weekly, Volume 32, No. 14. [f.] The FNP publication of one (1) was not challenged. [g.] The parties agree that Schedules 1 through 10, contained in each of the two CON applications (Nos. 9928 and 9931), may be admitted into evidence as reasonable projections without a sponsoring witness. [h.] The parties agree that the audited financial statements of the two applicants and parent entities, presented in the CON applications are true and accurate copies of the respective entity's audited financial statements and may be admitted into evidence without a sponsoring witness. [i.] As to Schedule 5, the parties agree that the figures presented by both Applicants are reasonable, and each applicant is likely to meet their respective utilization projections presented in Schedule 5. * * * [j.] As to Schedule 6, the parties agree that each applicant can provide hospice services with the staffing positions and volumes presented in Schedule 6, and that the staffing and salaries proposed are reasonable for the services proposed by each applicant. [k.] The stipulations, referenced in paragraphs 8 through 11 above, shall not preclude the parties from presenting comparative evidence about any aspect of the information presented or assumptions contained in Schedules 1 through 10 of either of the two remaining applications. [l.] Section 408.035(1), Florida Statutes (2005) provides in pertinent part as follows: "The need for the healthcare facilities and health services being proposed." Pursuant to AHCA's Florida Need Projections for the hospice program, background information for use in conjunction with the April 2006 Batching Cycle for the July 2007 Hospice Planning Horizon, a need was identified for one (1) additional hospice program in AHCA Service Area 10. Thus, CATHOLIC HOSPICE, PALM COAST, and the Agency agree there is a need for one (1) program. * * * [m.] Section 408.035(3) provides in pertinent part as follows: "The ability of the applicant to provide quality of care and the applicant's record of providing quality of care." Section 408.035 is not at issue with respect to either CATHOLIC HOSPICE or PALM COAST's compliance with the above-referenced statutory criteria. The parties agree that both of the proposed programs can provide quality care and satisfy the criterion in Section 408.035(3), Florida Statutes. [n.] Section 408.035(4) provides in pertinent part as follows: "The availability of resources, including health personnel, management personnel, and funds for capital and operating expenditures, for project accomplishment and operation." [o.] Section 408.035(5), Florida Statutes (2005) provides in pertinent part as follows: "The extent to which the proposed services will enhance access to healthcare for residents of the service district." The parties agree, that to the extent there is a published need, approval of either CATHOLIC HOSPICE or PALM COAST would enhance access to healthcare for residents of the Service Area. Notwithstanding the fact that both CATHOLIC HOSPICE and PALM COAST believe that approval of either program will enhance access to healthcare for residents of the Service Area, nothing herein shall preclude the parties from presenting comparative evidence as to which program would provide better access. [p.] Section 408.035(6) provides in pertinent part as follows: "The immediate and long-term financial feasibility of the proposal." Section 408.035(6) is not at issue in these proceedings. The parties agree that both proposed hospice programs are financially feasible in the short- and long-term, and satisfy the criteria in Section 408.035(6), Florida Statutes. [q.] Section 408.035(8), Florida Statutes (2005), provides in pertinent part as follows: "The costs and methods of the proposed construction, including the costs and methods of energy provision and the availability of alternative, less costly, or more effective methods of construction." Section 408.035(8) is not at issue with respect to a review of the CON applications filed by CATHOLIC HOSPICE or PALM COAST. [r.] AHCA is the state agency responsible for issuance of licenses to hospice providers, and is the sole state agency authorized to make Certificate of Need ("CON") determinations. [s.] North Broward Hospital District is a special hospital taxing district created by Special Act of the Florida Legislature, chapter 27438, Laws of Florida (1951), and operates in the northern geographical area of Broward County. GOLD COAST is an operating unit of North Broward Hospital District. [t.] CATHOLIC HOSPICE is a not-for-profit Florida corporation and existing provider of hospice services in Florida. [u.] PALM COAST is a not-for-profit Florida corporation and existing provider of hospice services in Florida. [v.] CATHOLIC HOSPICE and PALM COAST are each currently providing services through licensed hospice programs in Hospice Service Area 11 (Miami - Dade and Monroe Counties). [w.] Hospice Service Area 10 is Broward County, Florida. [x.] The current hospice providers in Hospice Service Area 10 are VITAS Healthcare Corporation of Florida, Hospice By the Sea, Inc., HospiceCare of Southeast Florida, Inc., and GOLD COAST. Joint Prehearing Stipulation, filed May 9, 2007. The Applicants in Other Service Areas; Existing Providers in Service Area 10 Catholic Hospice is currently licensed and operating in Service Area 11, Dade and Monroe Counties. Palm Coast has programs that are currently licensed and operating in Service Area 4B, comprising of Flagler and Volusia Counties and, like Catholic Hospice, in Service Area 11. Service Area 10 has four existing providers of hospice services. Vitas Healthcare Corporation of Florida (Vitas) is a for-profit hospice. The other three, Hospice By the Sea, Inc., HospiceCare of Southeast Florida, Inc., and Gold Coast, are all community-based not-for-profit hospices. Of the four existing providers, Vitas is by far the dominant provider of hospice services in the service area. Affiliations and Sponsors Palm Coast Affiliation with Odyssey Palm Coast is affiliated with Odyssey Healthcare, Inc., a for-profit corporation. Despite the affiliation, Palm Coast is a distinct entity in accordance with Florida law. It has its own Articles of Incorporation and By-Laws, its own audited financial statements and its own local governing board. It complies, moreover, with all state and federal requirements for AHCA and Medicare licensure and certification. Additionally, each of the individual Palm Coast programs has its own bank account into which all of its revenues are deposited and out of which all of its expenses are paid. If the proposed Palm Coast hospice program in Broward County exhibits a positive cash flow from its operations, those fund will remain with the program to be used for patient care and operations. This is the practice followed by Palm Coast at its existing programs in Service Areas 4B and 11. The Palm Coast model, therefore, which Palm Coast will follow should it be approved in Broward County, will be to act and operate as a community-based hospice. While it will "act locally," it will also benefit from its affiliation with Odyssey. It will be able to take advantage of Odyssey's resources, experience and successful management tactics. These benefits include economies of scale based on Odyssey's buying power and operation of 80 programs in 26 states, Odyssey's experience with a multitude of startup programs, identification and treatment of minority population and non-cancer patients, treatment of cancer patients (traditionally served by hospices), extensive educational tools developed over 10 years of operation, continuing education for all staff members, accessibility to a large clinical database, and access to centralized services such as billing and foundation funds. Through its affiliation with Odyssey and with the assistance Odyssey is reasonably expected to provide, Palm Coast possesses the necessary management and clinical experience, operational systems and corporate resources to efficiently, effectively and successfully implement a new hospice program in Service Area 10. Indeed, the benefit of combining local resources and knowledge with Odyssey's nationwide experience, assets, buying power and success has been demonstrated with the successful establishment of Palm Coast programs in Service Area 4B and Service Area 11, the service area in which Palm Coast's rival in this proceeding gathers its own support and sponsorship. b. Catholic Hospice's Corporate Sponsors in Service Area 11 Catholic Hospice has two corporate sponsors in Service Area 11: the Archdiocese of Miami and Mercy Hospital. The Archdiocese consists of Broward, Dade and Monroe Counties. It places a priority on health care as a large part of its mission. The Archdiocese is the sole corporate sponsor of a substantial network of post-acute health care facilities in Dade and Broward Counties, including rehabilitation hospitals, nursing homes, assisted living facilities, HUD elderly housing facilities and cemeteries. This health care network is managed from its headquarters in Broward County by Catholic Health Services (“CHS”), and extends throughout the geographic boundaries of the Archdiocese. Founded in 1988, Catholic Hospice is the realization of the aspirations of the Archdiocese's Monsignor Walsh. At the time, the hope was for Catholic Hospice to serve the entire geographic area of the Archdiocese; a CON, however, could only be secured for Service Area 11. Hospice services in Broward County is missing from the continuum of care in which the Archdiocese is engaged. There will be a benefit to the patients in the CHS network of care because continuum of care increases continuity of care and is better for patients. The gap in the Archdiocese's continuum of care is therefore significant to the patients it serves. Mercy Hospital, the second corporate sponsor of Catholic Hospice in Dade County, is an acute care hospital managed by Catholic Health East. Catholic Health East is a Catholic network of over 35 acute care hospitals that extends along the east coast of the United States from Maine to Florida. The network includes Holy Cross Hospital in Broward County. Support for Catholic Hospice by Catholic Health and Elder Care Entities The Archdiocese of Miami, Mercy Hospital, Holy Cross Hospital in Broward County and Catholic Health East all share a common identity as faith-based, not-for-profit organizations with the mission of demonstrating reverence for the human body and spirit by bringing the healing and comfort of the Lord to those in need throughout their respective communities. The common mission and identity that Catholic Hospice and the related Catholic health care entities share naturally cultivates collaboration among them. These collaborations within an extended network of health and elder care services are significant. They will allow Catholic Hospice to expand into Broward County quickly and efficiently. Palm Coast's Benefits from Affiliation with Odyssey Palm Coast has available to it through its management agreement with Odyssey, all the resources of the two existing Palm Coast programs as well as the nationwide resources of Odyssey. Due to its experience with new market development, Odyssey has the ability to enter the market rapidly; programs, policies, and operations are already in place, and the strong support resources provide the wherewithal for Hospice Palm Coast to do their job of rapidly, efficiently, and appropriately upon entering the Broward County marketplace. Odyssey has started over thirty hospice programs since 1995, with five new programs established in the 2006 calendar year, evidence of experience in development of new hospice programs, in addition to their experience with hospice acquisitions. The proof of likely success in Broward County as the result of Palm Coast's affiliation with Odyssey can be seen, moreover, in the success of Palm Coast's programs in District 4A and 11, implemented under the guidance and direction of Odyssey. In the marketplaces where Odyssey and Palm Coast have historically initiated new hospice programs, they have become proficient at determining the traditional or existing core of business for the existing providers, and utilized their experience and success to come in and fill the gaps, otherwise known as providing "Hospice Services Beyond the Traditional Model." The addition of Hospice of the Palm Coast in Broward County will allow for the expansion of the Odyssey way of life, through its not-for-profit affiliate, utilizing its successful operational philosophy and Fourteen Service Standards. Odyssey has a dedicated start-up team that, upon CON approval, plans to work with the local providers and other individuals or entities within the local market, to guide the Palm Coast's Broward program from the CON approval, up through Medicare certification. Operationally, based on its size in terms of programs and economies of scale, there are significant benefits to Palm Coast's proposed program in Broward; the ability to contract on a national level for corporate wide benefits including a variety of medical equipment, medical supplies, and pharmacy supplies, due to the operation of over 80 hospice programs nationwide, which yields significant economies of scale. The Odyssey Support Center provides the Palm Coast start-up programs with policies and procedures, forms, educational materials, and training, in addition to centralized services efficiently operated for all the Odyssey programs from the Dallas corporate headquarters. Specifically, Odyssey supports each individual hospice location by providing coordination, centralized resources, and corporate services, including, but not limited to: Financial accounting systems, including billing, accounts receivable, accounts payable, and payroll; Information and telecommunications systems; Clinical support services; Human resource administration; Regulatory compliance and quality assurance; Marketing and educational materials; Training and development; and Start-up licensure and certification. In return for these services provided by Odyssey, the Palm Coast programs pay a management fee, which is calculated as seven percent of the local hospice's net revenue. The same arrangement will be implemented upon Palm Coast's approval for the CON in Broward. These resources allow each local office to focus on Odyssey's primary mission to provide responsive, quality care to patients and their families. Once the Palm Coast entities, including the proposed Broward program, become "cash positive," a separate and distinct bank account will be opened to ensure the funds of the not-for- profit Palm Coast entities are not co-mingled with that of its management affiliate Odyssey. Broward County Diversity and Need The population of Broward County is becoming increasingly diverse. The population that is dying is also becoming more diverse. For example, from 1996 to 2004, Hispanic deaths in Broward County increased by 50 percent whereas deaths of the non-Hispanic population declined. At the same time, African-Americans and non-Caucasians had significant increases in deaths while Caucasian deaths declined. Since 2000, existing providers have not met the needs of all of the age and diagnosis groups in the District. "[P]art of the reason for that is that the underlying nature of the service area has been changing, becoming more diverse … [and] younger, with a growing ethnic population." Tr. 620. While Service Area 10 has been changing, the existing providers have not been able to adapt to the changes in the population. Catholic Hospice's History of Dealing with Diversity For almost 20 years, Catholic Hospice has refined its expertise in ascertaining and meeting the needs of the diverse, multi-cultural population within Dade County, including Hispanics, Haitians, Caribbeans, Jamaicans and African Americans. This history demonstrates Catholic Hospice's ability to ascertain and meet the needs of the diverse population in Broward County if approved. One of the strengths of Catholic Hospice is its culturally and ethnically diverse staff, many of whom are bilingual. Having bilingual staff is significant. For example, Catholic Hospice’s Medical Director, Dr. Kiedrowski speaks Spanish fluently and has seen only one patient whose primary language was English in the year and a half he has been on staff. In fact, seventy to eighty percent of Catholic Hospice’s patients in Service Area 11 are Hispanic. Catholic Hospice is particularly sensitive and responsive to the needs of the Hispanic community – the majority of which identify themselves as Catholic. Palm Coast's History of Dealing with Diversity Palm Coast does not have Catholic Hospice's multi- decade experience of dealing with diversity in Service Area 11 that will be of such benefit in Service Area 10. In contrast to Catholic Hospice in Service Area 11, Palm Coast is a start up that has only been in existence for about a year. Palm Coast is not lacking in the ability to deal with diverse populations, however, because of its affiliation with Odyssey and experience in Service Areas 4B and 11. This ability is demonstrated by Palm Coast's practice while its programs have been in a start-up phase in these service areas. Upon entering a new community, Palm Coast hires caregivers and administrative personnel for the hospice office from the community. These new employees reflect different local cultures, whether Hispanic, African American or other. In Service Area 11, for example, Palm Coast's new employees include Haitian employees to reflect the Haitian component of the diverse local culture in the area. In addition to diversity in hiring practices, cultural diversity training is offered to Palm Coast employees by Odyssey. The training involves education with regard to local cultures, religions, and customs unique to the area. Palm Coast's intent, therefore, is to hire and train a diverse group of individual from the same locale as the patients in order to facilitate the service to patients and increase the patients' comfort levels. Palm Coast makes an effort to recruit a staff that mirrors the racial and ethnic make-up of the community it serves. The effort and experience that Palm Coast has had in Service Area 11 in particular will serve Palm Coast well in Service Area 10 should its application be approved. But Catholic Hospice’s long history with serving the multicultural needs in Dade County is predictive of better capability to deal with Broward County's diversity than Palm Coast's one-year experience in the County and its intent to follow in the footsteps of that experience in Broward County should its application be approved. Hospice Services and Programs Hospice is both a philosophy and method of care for terminally ill patients, their families and loved ones. Hospice services provide palliative care for pain and management of symptoms of a terminal disease process or processes, as well as supportive care to ease the psychological and social strains of a patient and his or her family confronting mortality. Palliative medicine focuses on relieving suffering and symptoms, not curing a patient. Usually provided in the home, hospice services are required to be capable of being tailored based on individual need and are required to be available twenty-four hours a day, seven days a week, including holidays. Catholic Hospice meets these requirements. Palm Coast meets the requirements as well. Palm Coast's Program Palm Coast's program is reflective of a spirit and idea of caring that emphasizes comfort and dignity for the dying, making it possible for them to remain independent for as long as possible and in familiar surroundings. Palm Coast utilizes an interdisciplinary team approach of physicians, nurses, social workers, and others to provide services including palliative care in the home, short-term inpatient services, mobilization and coordination of ancillary services and bereavement support. The patient's plan of care is developed and regularly modified by the interdisciplinary team: a physician, nurse, social worker, chaplain, and bereavement coordinator. The team may include a volunteer coordinator, volunteers, nursing assistants and home health aides. The Palm Coast interdisciplinary team meets on a specific timetable. Paula Toole, an Odyssey Healthcare regional vice president who covers Odyssey's south region described the timetable at hearing and the content of the meetings: "Generally its every two weeks. If [the patient] is on a higher level of care, it may be every week or . . . day." Tr. 962. The interdisciplinary team discusses the patient and the family to determine what services are being provided and whether they are appropriate to provide the patient and the family with the best hospice care. Catholic Hospice’s Continuum of Quality Services There are four levels of hospice care: continuous care, general inpatient care, routine home care, and inpatient respite care. Continuous care and general inpatient care are considered “intensive” services as they involve the most complex, medically unstable patients and a higher level of services. Continuous care is often used when a patient is in crisis and requires more frequent physician visits. A key factor that has improved availability of hospice care is the Medicare Hospice benefit. To be eligible for the Medicare hospice benefit, a patient must be certified by two physicians to have a life expectancy of less than six months if the patient’s disease process runs its normal course. Statutory standards require that a hospice implement home care within three months after licensure and inpatient care within twelve months. Catholic Hospice will be able to make routine and continuous home care visits immediately upon licensure in Broward County. Catholic Hospice can manage operations from its existing office in Miami Lakes and a new office to be almost immediately established in Lauderdale Lakes through a lease with CHS. Catholic Hospice reasonably expects to enter contracts for the provision of inpatient hospice care with existing hospitals and nursing homes immediately upon licensure –- making inpatient hospice immediately available. In addition, Broward residents may choose to access a freestanding inpatient hospice unit in northwest Dade County for which Catholic Hospice has been approved and plans to open in 2008. Upon approval and licensure of Catholic Hospice’s proposed Broward County program, CHS will contract with Catholic Hospice to provide hospice services to persons in its Broward facilities as it does currently for its Dade County facilities. The plans for Broward County will not be the first collaboration between Catholic Hospice and CHS. Catholic Hospice has an approved CON for a 13-bed free-standing inpatient hospice facility in Dade County. The inpatient hospice facility will be on the third floor of a building that will also house a rehabilitation hospital for CHS. That facility is located so that it will be accessible to persons in southern Broward County that require an inpatient level of care, or lack a caregiver or are homeless and require residential care. Catholic Hospice will employ existing policies and procedures to administer its offices and direct patient care. Hospice services are typically provided through the use of an interdisciplinary team that provides, at a minimum, core services, including physician services, nursing services, nutrition services, social services, pastoral care or chaplain services, volunteer services, and bereavement services. In addition, services such as physical therapy, occupational therapy, speech therapy, home health aide services, infusion therapy, medical supplies and equipment, and homemaker services should be provided as needed. Catholic Hospice complies and provides core services as well as additional services such as radiation therapy and chemotherapy as each patient requires. Catholic Hospice has divided its current service area into four sections and provides a full spectrum of hospice services through four interdisciplinary teams that provide high quality care. Each team is responsible for one section of the county. The number of visits a patient receives from members of the interdisciplinary team is determined by the plan of care. Once a patient enters the program, they are admitted by an admissions nurse who collaborates with the physician and family to develop the plan of care. As a patient’s health declines, the patient will receive visits by the interdisciplinary team members, including nurses and physicians as needed. Catholic Hospice has no limitation or hard rules on the number of visits -– it is based on patient need. The interdisciplinary teams have regular meetings to re-evaluate patients’ plans of care. Physician Services Physician services are a strength of Catholic Hospice -– ensuring that any patient that needs to see a physician does, and promptly. Catholic Hospice has four staff physicians who work in the community making house calls and seeing patients at nursing homes and assisted living facilities. In addition, Catholic hospice has contracted physicians at hospitals within its service area to cover patients in its contract hospitals. Patient care and particularly physician services at Catholic Hospice are overseen by Dr. Brian Kiedrowski, a Certified Medical Director, board-certified in geriatric medicine and a diplomat of the American Board of Hospice and Palliative Medicine. Catholic Hospice has policies for the credentialing of its physicians to verify education and experience, ensuring the continued quality of Catholic Hospices’ physician services. A physician is assigned to each interdisciplinary team at Catholic Hospice, including Dr. Kiedrowski, the Medical Director. This has added to his credibility with the facilities in Service Area 11 and improved collaboration with community providers. At a minimum, each Catholic Hospice patient is seen by a physician within three days of coming into the program because hospice is urgent. Following that, patients are seen at least once a month, but it depends on the needs of the patient and may be more often. Nothing substitutes for a physician’s presence with the patient while performing an examination to determine appropriate treatment. For example, if a patient is short of breath, the physician needs to see the patient to determine what is happening and appropriate treatment. Catholic Hospice also has protocols for the communication among its physicians and between its physicians and attending physicians, should an attending physician want to continue to follow the patient. This improves quality of care by increasing communication and ensuring that patients are not in limbo if an attending physician cannot be reached at a time of crisis. Physicians, like other Catholic Hospice employees, participate in orientation which facilitates team-building and increases physicians’ sensitivity to the various cultures and religions in South Florida. In addition, Dr. Kiedrowski will go into the field with nurses or other staff physicians to exchange training and provide monitoring or proctoring of clinical skills. In contrast, most of Palm Coast’s clinical education is performed through standardized self-directed online training modules through its parent corporation in Dallas, Texas. Nursing Services Catholic Hospice provides high quality nursing services and has policies in place to ensure that quality continues, including such clinical details as the care of central venous access (“CVA”) devices and subcutaneous infusions. Catholic Hospice can immediately implement its comprehensive nursing policies in Broward County upon approval. Nutrition Services Catholic Hospice provides nutrition services to its patients through two pooled dieticians, one for the northern part of Service Area 11 and one for the southern portion. The dieticians perform nutritional risk assessments on all non- cancer patients and patients under eighteen who are having total parenteral nutrition -- meaning they are being fed intravenously. The dieticians are a great asset and comfort to patients and families. Catholic Hospice cares about nutrition for its patients eating. It provides patients and their families with nutrition education and prepares them for what to expect as the patient’s disease progresses. Nutrition, as with many areas within hospice services, requires particular sensitivity to cultures, including Hispanics and others. Catholic Hospice has successfully accommodated the nutritional needs of the various cultures it serves. Catholic Hospice will implement these same policies for providing nutrition services in Broward County upon approval. Social Services Social Services at Catholic Hospice are provided by a group of graduate level social workers which is a requirement of Catholic Hospice. The services are broad in scope, including everything from family counseling to coordinating for caregivers and facilitating the securing of other resource needs of the patient and family. Catholic Hospice has policies in place for the provision of these services that can be immediately implemented in Broward County. Catholic Hospice has written and received a caregiver grant in the amount of one hundred thousand dollars that is renewed annually and administered locally through Dade County. The grant targets individuals and families that are facing the choice of having to place a loved one in a nursing home to be able to hold a job or attend appointments because they cannot financially afford a private caregiver and, in part counteracts caregiver fatigue. Volunteers can provide respite for caregivers as well. Catholic Hospice will seek similar opportunities in Broward County if approved. State and local regulations require hospices have emergency management plans. These plans are submitted to the Agency and local government. The plans are required to have certain elements to ensure that patients and families will not experience interruptions in hospice service in the event of a natural disaster or other emergency. Catholic Hospice is capable of successfully developing and implementing a similarly comprehensive plan in Broward County if approved. Serving All Faiths -- Pastoral Care or Chaplain Services Catholic Hospice serves persons regardless of religion or lack thereof. Patients include those who are Catholics (as expected), Buddhists, Seventh-day Adventists, Santerians, Jewish, Baptists, and Pentecostals. The staff of Catholic Hospice reflects a diversity of religious beliefs as well. Ms. Murray, for example, the Vice President for Nursing Services is of the Jewish faith. All of the staff are comfortable, however, with the Catholic identity and mission of Catholic hospice as a faith-based organization. Catholic Hospice has six chaplains who take care of persons of all faiths or no faith according to each patient’s needs and desires. In fact, the very first patient ever cared for by Catholic Hospice was Jewish. The chaplains are not all Roman Catholic. Chaplains are required to complete Clinical Pastoral Education (“CPE”) training, which is chaplaincy training. CPE training assists clergy with providing spiritual direction to persons of all faiths, independent of that clergy member’s own religious identity or affiliation. It helps them view spirituality from a universal standpoint to provide pastoral care and spiritual direction. At Catholic Hospice, chaplains also provide a connection to patients’ own faith communities -– mobilizing those relationships for the benefit of the patient and family. Additionally, each orientation includes a component of general spiritual care training to enable employees to reach out and connect with patients and families whatever their religious beliefs may be. One of Catholic Hospice’s chaplains is a Rabbi who provides particular assistance with Catholic Hospice’s L’Chaim program. The L’Chaim Program is a Jewish Hospice program emphasizing sensitivity to Jewish beliefs, customs and holiday traditions. Developed in response to community need, the L’Chaim program has its own mission statement and brochures geared to persons of the Jewish faith. Catholic Hospice’s orientation similarly includes a segment on L’Chaim. Catholic Hospice can successfully implement its current chaplain services policies upon approval of its proposed Broward program. Volunteer Services Catholic Hospice has a comprehensive program for the recruitment and training of volunteers. Volunteers provide respite services within the home setting –- often allowing a caregiver the opportunity to go to appointments and uphold other obligations they otherwise could not do. Catholic Hospice also has an “Angel Program” of volunteers that accompany patients during their final hours of life. These volunteers provide companionship to patients without family, and comfort to patients and families who are together in those final hours. Volunteers undergo comprehensive training similar to an employee orientation. Training is 16 hours long and is provided over two consecutive Saturdays. The training provides an overview of the organizational structure, the culture of Catholic Hospice and provides a breakdown of each volunteer’s role in the interdisciplinary team to ensure a complete understanding of the volunteer’s function and the limits that each works within. Catholic Hospice has developed training manuals for volunteers and because Catholic Hospice has volunteers fluent in both English and Spanish, training can be presented in either language, including the training manuals. Catholic Hospice has volunteers in its Dade program that are residents of Broward County. A condition of participation in the Medicare program for hospices requires that volunteer service match at least five percent of the overall care hours provided by hospice employees. Catholic Hospice surpassed that last fiscal year as ten percent of direct care hours were matched by volunteer hours. Catholic Hospice can adopt the same strategy and policies to successfully implement its volunteer program in Broward County. Bereavement Services Medicare guidelines require that some form of contact be maintained with families of hospice patients for up to 13 months following the death of their loved one. Catholic Hospice far surpasses that minimum. Catholic Hospice has a corps of graduate level clinicians specializing in grief work and each is assigned to a team. All of Catholic Hospice’s bereavement counselors are affiliated with the Association of Death Education and Counseling. Bereavement counselors preside over all bereavement activities and all family members are invited to establish a clinical relationship with that counselor to address his or her grief. Many hospice families experience what is called “complicated grief” -- grief that is particularly emotionally or spiritually complex due to the relationship with the patient, and much of the counseling work addresses those issues so that a survivor is not carrying regrets or guilt. Often a family member experiencing complicated grief will continue to work with the clinician over the course of several months. Catholic Hospice also provides bereavement services and support groups to the community. Such support groups are in parishes, nursing homes, and various community and institutional settings. The groups are open to members of the community as well as family members of patients and meet for a set period of time, usually 10 to 12 weeks. This allows Catholic Hospice to spread its resources throughout the community for maximum accessibility and responsiveness. On other occasions, bereavement counselors have visited local schools following student suicide. There the counselors not only intervened with the children trying to understand that loss, but provided education to school staff on responding to the children’s needs. A memorable example involved a group of accountants at the Loews Hotel in Miami Beach who were attending a workshop during the 911 attacks and lost many of their colleagues. Counselors were rotated to provide blocks of time over a two-day period to help those accountants with their grief. Catholic Hospice has conditioned its CON on providing community bereavement support groups at senior housing facilities in Broward county and is prepared to successfully provide those programs. CHS and Holy Cross have already volunteered its facilities for such programs. Catholic Hospice provides “Camp Hope” an annual bereavement camp for children who have experienced the loss of a family member, usually a parent. Camp Hope is volunteer-driven and provided free of charge to children throughout the community, not just children of hospice patients. The camp receives many referrals through the Dade County School system. The children are taken to a local camping facility and are provided a variety of therapeutic activities and recreation –- all presided over by professionals in their respective specialization. In the past, people from Broward have participated in the camp as a result of requests from within the community. Catholic Hospice has bereavement services policies that can be implemented in Broward County upon approval. Education Education is a strength of Catholic Hospice, including education of its own employees, its contract facilities, physicians and other health care providers, as well as the community at large. Catholic Hospice has a full-time nurse educator who is certified in hospice and palliative care nursing. Each employee participates in a week-long orientation familiarizing himself or herself with Catholic Hospice and the diverse ethnic and religious community he or she is about to serve. Clinical staff may be oriented for an additional week or more. Following orientation, there is a new employee follow-up and periodic additional training. As part of the orientation process and thereafter in continuing education presentations, the employees demonstrate competency with various skills. The competency packet also contains a post-test and, if an individual has a particularly low post-test score, a copy is sent to that person’s supervisor for follow-up. The goal is for employees to feel comfortable training patients and families about hospice. During the orientation, employees are trained on how to perform a cultural assessment for any patient who chooses Catholic Hospice’s Services. This includes general information on tendencies within certain ethnic groups and leaving one’s assumptions and beliefs “at the door” so that each individual patient may express his or her beliefs. The goal of Catholic Hospice is for each employee to be able to engage in active listening to help differentiate the needs of individuals within the Hispanic population or any other population. The education manager is also responsible for two hours of continuing education for the interdisciplinary staff every month. The education manager holds a provider number issued through the Board of Health, Division of Medical Quality Assurance for providing education for nurses, social workers and mental health workers; accordingly, all presentations at Catholic Hospice are geared toward allowing professional staff to accumulate medical education credit. Medical education is likewise offered to contract and non-contract facilities in the community for their staff. The nurse educator oversees university students who come to Catholic Hospice as part of their medical education training. Catholic Hospice has enjoyed long-standing relationships with various universities, including the University of Miami, Florida International University, and Barry University. Catholic Hospice has contracts with each university for nursing students and other health and counseling program interns for rotations with Catholic Hospice as part of the students’ community experience and training in end-of-life care. Working with the students provides Catholic Hospice valuable information on how it is perceived within the community it serves. Outreach Catholic Hospice recognizes that cultural factors can prevent access to hospice care and is organizationally sensitive to those factors providing employee education to counteract them -– such as the cultural assessments described earlier, through facility education with its contracted facilities and insurance providers, and through community outreach to the general population. Catholic Hospice’s goal is to reduce barriers to hospice care overall. For example, Catholic Hospice is part of a pilot program, “Partners in Care,” to provide palliative care services for children with life-limiting illnesses. Catholic Hospice has two community liaisons who conduct community outreach with hospitals, nursing homes, physicians and various civic organizations to provide presentations on hospice. As a condition to its CON, Catholic Hospice has agreed to provide outreach to Hispanics and persons under 65 and to provide bereavement support groups and has a proven ability to do so. Much of Catholic Hospice’s outreach includes persons under 65 years old and Hispanics. The composition of participants in facility education, insurance provider in- services, caregiver education initiatives, support groups, community health fairs, parish and community bereavement groups are attended by persons under 65. Catholic Hospice has also provided care outreach and training for lay ministers within the parishes to increase sensitivity to specific needs of patients facing illness. Brochures and other materials are available in English and Spanish. Providing outreach in existing community facilities increases Catholic Hospice’s visibility in the community. Most of Catholic Hospice’s patients are Hispanic and the majority of those persons are Roman Catholic. As an organization of the Archdiocese, the individual parishes throughout Dade County have been opened for Catholic Hospice to visit Mass or smaller groups to provide education on end of life care and hospice. Catholic Hospice has a radio show on Radio Paz, the Archdiocese’ radio station. Called “Caminando Contigo” or “Walking with You,” the show is presented in Spanish each Monday from 2:30 p.m. to 3:00 p.m. The program is an educational presentation on hospice services broadcast throughout Miami-Dade and Broward County into West Palm Beach. In addition, Catholic Hospice’s community relations manager regularly appears on public television shows to speak about hospice services. Catholic Hospice engages in modest fundraising to supplement its mission of caring for all those in need. Catholic Hospice’s two main fundraisers are an annual golf tournament and the Tree of Hope where people contribute by purchasing or sponsoring memorial holiday ornaments. Catholic Hospice can successfully duplicate its outreach and fundraising programs in Broward County upon approval. Different Orientations Catholic Hospice's organization is "faith based." “Faith based” is not just providing chaplain services. All hospices are required to do so. Rather, "faith based" is the spirit of mission that drives every decision at Catholic Hospice from the top of the organization down. Catholic Hospice’s stakeholders are the community it serves and its employees. Palm Coast's affiliation with Odyssey gives it different orientation from Catholic Hospice's. A for-profit company such as Odyssey Health Care has a fiduciary duty to increase profits for its shareholders and will be motivated by that fiduciary duty or “mission” of profitability. Although organized as a not-for-profit, Palm Coast nevertheless shares that mission of profitability acting like a for-profit company. For example, Palm Coast offers stock options to its employees. Palm Coast’s billing and banking are done at the Dallas headquarters, consolidated with the ledger for Odyssey Healthcare. Palm Coast pays a management fee to Odyssey because that is the only way for the cash to flow upstream under Florida law and Palm Coast’s assets, along with those of other Odyssey programs, secures a 20-million dollar line of credit for Odyssey. Odyssey assesses a management fee of seven percent of net revenue monthly therefore the higher net revenue to Palm Coast the greater the contribution to Odyssey's profitability. Currently, the profits from Palm Coast are used to develop additional hospices in Florida. In contrast, Catholic Hospice is likely to spend more on patient care and provide the choice of faith-based hospice services that currently do not exist in Service Area 10. Palm Coast's Community and Employee Education When entering a community, Palm Coast hires a team of community education representatives ("CERs"), along with the program's general manager, their function is to primarily provide day-to-day education to the community at large. It is not unusual to find people in the community who are completely unfamiliar with hospice and its benefits. The CERs concentrate on educating referral sources, not just on the availability of hospice services, but also patient eligibility and provide information not only on cancer but the numerous non-cancer terminal diseases for which hospice care is potentially appropriate. The Palm Coast CERs seek to educate the members of the medical profession at hospitals, nursing homes, and assisted living facilities, doctors offices, professional buildings, as well as educating those within the community, by speaking at churches, community organizations, Kiwanis clubs, rotary clubs, Chambers of Commerce and other community activities. The CERs utilize any opportunity to educate about hospice in general (not necessarily regarding Odyssey or Palm Coast), because as evidenced by the increasing number of patients accessing hospice care and current penetration rates, the service is still underutilized and to some degree misunderstood. Palm Coast - Broward plans to initially hire a minimum of three CERs to concentrate its efforts on community education in Broward before it serves its first patient. The CERs travel throughout the community and evaluate the areas in which the existing providers are providing sufficient hospice education, and where they may be lacking, seeking to find the holes in the system or gaps in the network, in which to offer their services. Palm Coast provides education to employees of nursing homes, hospitals, and assisted living those facilities, many of whom require bereavement counseling following the death of patients. The CERs have also proven to be a resource to grief stricken individuals seeking hospice care; if a patient or family calls and inquiries, the CERs help walk them through the process of how one is admitted to hospice care. The Palm Coast educational team is comprised of an array of individuals, including the receptionist, nurse, social worker, chaplain, home health aides, and volunteers, along with the CERs; everybody involved talks about hospice and educates those in the community. With respect to Palm Coast's interdisciplinary team members, there is ongoing follow-up training in each office by the Quality Improvement Manager, in addition to monthly educational sessions company-wide. As one educational tool, Odyssey and Palm Coast have developed pocket-sized "Slim Jims," which are clinical indicators or educational reference material that detail various disease processes and the criteria that would make an individual hospice appropriate. The front of each individual "Slim Jim" details the clinical indicators for each terminal disease, and the flip slide illustrates the benefits hospice care through Odyssey or Palm Coast could provide. These clinical indicators, incorporating CMS guidelines, have been successful in determining when hospice is appropriate for patients. The clinical indicators are regularly updated, along with any new guidelines published through CMS. Palm Coast in Miami has used the "Slip Jims" in helping to educate families on disease progression, what to expect, and the general characteristics of hospice care. In order to meet the cultural needs of the community, the laminated cards are currently being translated into Spanish, for use with Hispanic patients and families in Miami-Dade, Broward, and any other Palm Coast or Odyssey location with a significant Hispanic population. All hospice disciplines, including the members of the interdisciplinary team and the CERs utilize the "Slim Jims" to educate the community on various levels. As an educational tool to assist in the orientation and continual education of its employees, Palm Coast has access to "Odyssey University," as online program created by Odyssey that allows employees to participate in various educational courses and nursing modules, specifically tailored to each individual hospice professional (i.e., nursing manager, chaplain, social worker, etc.). There are a multitude of different modules, spanning the realm of topics from clinical to management. Palm Coast's Affiliation with Nova Southeastern University Palm Coast has executed a memorandum of understanding with Nova Southeastern University ("NSU"), by which it will be a partner with NSU's college of osteopathic medicine, geriatric program, dental program, and law program. The purpose of the partnership will be to develop ways for NSU's students to rotate through or to work with Palm Coast's patients and families. As the largest independent institution of higher education in Florida, and the seventh largest nationally, NSU educates its students using non-traditional methods, including, but not limited to utilizing external clinical settings to supplement what is taught in the classroom with real life settings and situations. The affiliation will create clinical settings for NSU's students that will afford benefits to Palm Coast, NSU, and the community at large. The program will offer the College of Osteopathic Medicine student clinical rotations with Palm Coast's patients; it will offer a Mental Health Counseling Program with NSU's Center for Psychological Studies; it will provide College of Pharmacy students experience with elderly patients; it will provide College of Dental Medicine with the opportunity to ease oral pain of a patient exacerbated by tooth decay, gum disease, or other "ortho-ailments;" and it will allow the Shepard Broad Law Center student to work with Palm Coast patients, reviewing forms and policies for legal sufficiency and accuracy. Patient benefits from the affiliation between Palm Coast and NSU include, but are not limited to: relief of symptom distress, understanding of the plan of care, assistance in coordination and control of care options, simultaneous palliation of suffering along with continued disease modifying treatments, ease of transition to hospice, and providing practical and emotional support for exhausted family caregivers. Odyssey, and specifically Ms. Toole, Odyssey Regional Vice President of the Southeastern Region, has established similar beneficial relationships with universities such as University of Alabama Birmingham, working together and involving them in certain aspects of the patient's care; a similar arrangement will be developed in Broward County upon approval. Ms. Toole, the expert witness in the fields of hospice operations and hospice administration, has observed a significant benefit to not just the hospice program, but to the students as well, providing an experience of dealing with patients with terminal illness and dying in the hospice setting. Odyssey and Palm Coast Charity Funds and Foundations As hospice staff cares for their patients, non- hospice needs are frequently identified; Odyssey has established the "Special Needs Fund" to assist their patients or families with extraordinary requests and needs. As an affiliate of Odyssey, Palm Coast has access to Odyssey's Special Needs Fund, from which it can request money for use to benefit patients in each local program. The fund is designed to provide assistance situations, for example, when it is cold and a patient is unable to pay his/her heating bill, or when the patient has no money available to purchase groceries. In those situations, Palm Coast request funds from the company, along with the justification, and that money will be provided, as needed. In 2005, over $60,000 in Special Needs Funding was use to meet the needs of 278 families. Palm Coast Bereavement Groups The Palm Coast team continues to care for the family even after the patient's death. In actuality, this program begins with an assessment upon admission of the patients into hospice. During the initial assessment, the registered nurse assess the grief of the family, and provides anticipatory "pre- bereavement" services based on need. Palm Coast seeks to identify people early on who are likely going to have a more difficult time in grieving the inevitable loss, so a plan for the family unit is initiated and included in the patient's plan of care. A bereavement plan of care is initiated within 72 hours of a patient's death. The bereavement coordinators offer support groups and memorial services for those who have had a loss, regardless of whether their loved ones were on hospice with Palm Coast, or never admitted to hospice at all. Support groups and memorial services offered by Palm Coast are held in nursing homes and ALFs, both for the facility as a whole and anyone who has had a loss, including staff members or residents, regardless of whether they were on hospice; it is not only those involved in hospice but for people in the community as a whole who may benefit from bereavement. Odyssey operates, "SKY Camp," a weekend camp in Amarillo for children who have experienced a loss, and is open to families of all Odyssey patients, as well as any other individuals who may inquire. Funded by the Odyssey Healthcare Foundation, SKY Camp is a free weekend camp for children ages seven to seventeen grieving the death of a loved one. The camp provides the children an opportunity to feel safe, nurtured, and most importantly, not alone, as many do in their time of grieving. Three Offices vs. One CHS will contract with Catholic Hospice for office space in Broward County at a fair market rate allowing Catholic Hospice to rapidly and efficiently establish an office centrally located within Broward County. This contrasts with Palm Coast’s plans for three offices. "[H]ospice care is primarily a home-based service, so the number of offices is not of particular importance[;] . . . [the number of] offices can be as many or as few as the provider would like . . . as long as they have at least one." Tr. 1409. The number of offices may play a part in rural areas in a multi- county service area. But Broward County is densely populated making more than one office an insignificant factor. Furthermore, because hospice services are provided in the home and hospice education can occur in any community facility, additional offices are not only not necessarily beneficial, they may be inefficient. For example, Palm Coast proposes to spend substantially more on rent and administrative costs than on patient care, whereas Catholic hospice spends on patient care and has low rent and administrative costs –- providing more benefit to the community consistent with its mission. Access: A Difference in Emphasis Catholic Hospice fulfills its mission to all patients regardless of age, sex, ethnicity, religious belief or lack of belief, ability to pay or level of need for care. While Catholic Hospice has an undeniable appeal to the Hispanic population that is predominantly Roman Catholic and an appeal to other Roman Catholics eligible for hospice services in Service Area 10, on the bases of age and diagnosis, Catholic Hospice does not emphasize service to "65 and over non-cancer" patients as does Palm Coast. In contrast to Palm Coast, Catholic Hospice outreach efforts are directed at persons under 65 and Hispanics. Consistent with conditions of Medicare participation that require hospice providers to accept all patients who meet eligibility requirements regardless of disease or ability to pay, Palm Coast also treats all patients. But Palm Coast emphasizes serving non-cancer patients 65 and older and seeks to emphasize penetration of the market segment represented by the population seeing it as underserved. Many non-cancer patients 65 and older in need of hospice service are recipients of care in long-term care settings such as assisted living facilities, supportive housing type programs and nursing homes. Odyssey has had great success in developing these programs. Such development as a goal for Palm Coast is consistent with Palm Coast's belief that non- cancer patients 65 and older are underserved. Yet, patients in Broward who are non-cancer patients 65 and older appear to be served as well as patients in other hospice-typical groups based on age and diagnosis. It is apparent that Vitas Healthcare-Broward, an existing hospice provider in Broward County, for example, already places an emphasis on serving the "65 and over non-cancer" patient that Palm Coast targets as underserved. Furthermore, Vitas has had greater success in serving this population relative to other hospice-typical groups than the three other existing providers in Broward County. This is illustrated by the chart at page 37 (Bate-stamped 00038) of Catholic's application proved up by the testimony at hearing of Mr. Cushman. The 2005 data on the chart shows Vitas Healthcare- Broward, a for-profit hospice organization like Palm Coast's parent, to be the dominant hospice provider in Service Area 10. Its market share for calendar year 2005 is 74 percent, dwarfing the market shares of the three other providers led by Hospice by the Sea at 13 percent with less than one-fifth of total market share enjoyed by Vitas. Dividing market share by age ("Under 65" and "65 and Over") and diagnosis (Cancer and Non-cancer), as is done by the Hospice Programs Rule, the highest market share for Vitas is in the "Non-cancer 65 and Over" category" at 77 percent. As Mr. Cushman explained: [Market share]'s nine percentage points less for those who have diagnoses other than cancer who are under 65; it's seven percentage points less for cancer diagnosis for elderly patients; and again, nine percentage points less for the patients with cancer under 65. . . . [T]he significance … is that the patients who are … the least costly to care for are the noncancer patients who are elderly. And that is the area where the for-profit program in Broward County [Vitas] Tr. 647. has sought and obtained the highest market share. Palm Coast's Claim of Special Circumstances Palm Coast claims that the "65 and Over Non-cancer" population in Service Area 10 is underserved. With regard to Special Circumstances to support approval of hospices, AHCA's rule provides: (4) Criteria for Determination of Need for a New Hospice Program. * * * (d) Approval Under Special Circumstances. In the absences of numeric need identified in paragraph (4)(a), the applicant must demonstrate that circumstances exist to justify approval of a new hospice. Evidence submitted by the applicant must document one or more of the following: 1. That a specific terminally ill population is not being served. Fla. Admin. Code R. 59C-1.0355. Palm Coast did not demonstrate that the "65 and Over Non-cancer" population in Service Area 10 is not being served. To the contrary, Catholic Hospice showed that it is being served by existing providers. Palm Coast's Affiliation with a For-profit Parent Palm Coast's emphasis on the "65 and Over Non-cancer" population in Broward County is consistent with the nature of its affiliation with its for-profit parent, Odyssey. If a hospice can spend less per patient day on patient care, it can be more profitable. Non-cancer patients tend to be less costly. Further, hospice care is generally more expensive at the beginning of care -– when the patient is being set up on a plan of care including medications, equipment and the like, and at the end of care when the patient and family may require additional visits and medications. Therefore, a hospice can increase its profits by increasing the number of patients with longer lengths of stay. Non-cancer patients over 65 tend to have longer lengths of stay. Thus, by heavily marketing to non-cancer patients over 65, Palm Coast can maximize its profitability. It will do so, however, to the detriment of other providers in its service area at the same time that the dominant provider in the service area is already doing so. Since Medicare reimbursement for hospice services is based on the assumption that all hospices will accept all patients, hospice programs will be able to redistribute costs from costly patients by having a balance between the more costly and less costly patients. When a hospice takes a disproportionate number of profitable patients, however, it leaves only the more costly patients for other providers who are not able to distribute costs over a full spectrum of expensive and less expensive patients. The effect is magnified because for-profits tend to be larger than not for profits. Indeed, Palm Coast’s new Dade program has ramped up quickly and doubled its budget projections. Palm Coast’s focus on profitability will negatively impact existing providers within the service areas it operates. Catholic Hospice, on the other hand, is likely to serve populations in the four categories of "under 65 non- cancer," "under 65 cancer," "65 and over non-cancer," and "65 and over cancer" without an emphasis on the more profitable "65 and over non-cancer" population segment, the group that Palm Coast will emphasize serving in order to maximize profits for its parent, a for-profit organization. Community Support for Catholic Hospice Letters of support demonstrates deep support for Catholic Hospice' application. One hundred twenty-five of them were received, a "high number . . . for a hospice program." Tr. 1406. Five were from physicians who indicated a willingness to refer patients to Catholic Hospice; two were from hospitals and one from a skilled nursing facility. In addition, Vitas recommended that if an additional hospice program for Broward County were to be approved that it should be Catholic Hospice, an "unusual" letter of support in Mr. Gregg's view. See id. CHS, itself, has received numerous requests for Catholic Hospice in its Broward facilities and has had to make other arrangements for those in its nursing homes, ALFs, and other facilities in Broward County since Catholic Hospice is not available in Broward County. Due to this recognized need, CHS has openly supported Catholic Hospice’s application and, through administrators of its various Broward health and elder care facilities, has provided letters of support, including letters from the administrator of St. John’s Nursing Center, the administrator of St. Joseph’s Residence, an ALF, the administrator of St. Anthony’s Rehabilitation Hospital, and an administrator at the HUD elderly housing facilities for CHS, including the five in Broward County. Similarly, Holy Cross Hospital is highly supportive of Catholic Hospice’s application and the need for a faith-based option for hospice in Broward County. Like CHS, Holy Cross intends to contract with Catholic hospice for inpatient hospice beds if Catholic Hospice’s Broward program is approved. Holy Cross has the capacity to provide more hospice inpatient beds without having to disrupt contracts and relationships it currently has for hospice beds; thus, relationships with existing providers will not be impacted. Physicians at Holy Cross support Catholic Hospice’s application, noting in particular Catholic Hospice’s sensitivity to the needs of Hispanic patients,--a growing segment of the population in Broward County-- and will refer patients to Catholic Hospice if it is approved. Memorial Healthcare System, a group of five hospitals that comprise the South Broward Hospital District, supports Catholic Hospice’s application noting that it will provide patients with a choice for a faith-based provider and emphasizing Catholic Hospice’s sensitivity to the needs of the Hispanic community and the growing Hispanic population in southern Broward County. Of the existing hospice providers in Broward County, one supports Catholic Hospice’s application and two others prefer Catholic Hospice if a new program is approved. In sum, Catholic Hospice is a diverse, long-term provider with a proven record of quality services and community responsiveness that fits within a continuum of care offered through the Archdiocese. Accordingly, Catholic Hospice can quickly move into Broward County with outstanding community support and improve the situation for residents of Service Area 10 with minimal impact to existing providers.
Recommendation Based on the foregoing Findings of Fact and Conclusion of Law it is RECOMMENDED that the Agency for Health Care Administration issue a final order that approves Catholic Hospice's CON application for a new hospice program in Service Area 10 and denies Palm Coast's CON application for a new hospice program in Service Area 10. DONE AND ENTERED this 26th day of October, 2007, 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 26th day of October, 2007.
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 The issue is whether certificate of need No. 4370 should be issued to the Visiting Nurse Association of Broward County to operate a hospice program, which will include five inpatient beds. STIPULATON CONCERNING APPLICABLE STATUTES The joint stipulation filed by the parties indicates that not all statutory criteria for evaluating certificate of need applications for hospices apply to this case. Section 381.494(6)(c)6, 10, and 11, Florida Statutes, do not apply. Section 400.601, et. seq. Florida Statutes, and Rules 10A- 5.001(1)(j), 10- 5.011(1)(b), and Rule 10A-12.001, et. seq., Florida Administrative Code, apply. There is a dispute over whether Section 381.494(6)(d), Florida Statutes, applies.
Findings Of Fact General Procedural Background The Visiting Nurse Association of Broward County, Inc. Community Hospital (VNA) applied on December 12, 1985, for a certificate of need to operate a hospice program, including five inpatient beds, in Broward County, Florida. A State Agency Action Report was issued by the Department of Health and Rehabilitative Services (HRS) preliminarily approving the application, which was published in Volume 12, No. 21 of the Florida Administrative Weekly on May 23, 1986, at page 1966. Hospice, Inc., Broward County (Hospice) and Hospice Care of Broward County, Inc. (Hospice Care) filed petitions to contest the preliminary approval of the application, and those petitions were consolidated for hearing. Brief Description of the Parties Visiting Nurse Association VNA is a not-for-profit charitable organization established in 1959. It is a Medicare and Medicaid certified home health agency which provides comprehensive home health services to residents of Broward County regardless of age, ability to pay, or payor source. VNA has a somewhat complex corporate structure. The parent corporation is Visiting Nurse Health Services, Inc. This corporation provides management, administrative support and consultative services to its subsidiary corporations which are: The Visiting Nurse Association of Broward County Foundation, Inc., a not-for-profit corporation which raises funds to fulfill VNA's goal of providing health care to the indigent. Visiting Nurse Home Care, Inc., a Florida not-for-profit corporation which provides private duty nursing care, physical therapy and other home health services, including homemaker services and personal care services to non-Medicare patients in Broward County. Visiting Nurse Association of Dade County, a not-for-profit Medicare and Medicaid certified home health agency which provides comprehensive home health services in Dade County. VNA Foundation, a not-for-profit corporation which raises funds for VNA's operations in Dade County. Visiting Home Services, Inc., a licensed home health agency which provides services to non-Medicare patients in Dade County, Florida. VNA is governed by a board made up of community members who serve voluntarily. VNA has provided service to indigents even before inception of the Medicare program. VNA has maintained long term relationships with publicly funded hospitals, with particular emphasis on providing continuity of care to patients and providing alternatives to hospital care. In fulfillment of its mission, VNA has contracted with the North Broward Hospital District to provide a full range of services to indigent Medicaid patients in the northern two-thirds of Broward County, where that District operates three hospitals, North Broward Medical Center, Broward General Medical Center and Imperial Point Medical Center. VNA employs nurses who work with the district hospitals to improve the accessibility of health care to indigents by assisting in planning care for indigents after discharge from the hospital. In 1985 and 1986 VNA served about 2,900 patients each year. VNA also receives referrals from other hospitals in Broward County, including hospitals operated by Humana Corporation; Memorial Hospital, which is operated by the South Broward Hospital District; and Pembroke Pines General Hospital. It receives referrals in Dade County from Jackson Memorial Hospital, the public hospital for Dade County operated by the Public Health Trust, and the Veterans Administration Medical Center. VNA operates special pediatric programs for children whose health care is covered by Medicaid. VNA also had assisted the Public Health Trust to develop in Dade County a comprehensive proposal seeking a grant from the Robert Woods Johnson Foundation for the treatment and prevention of Acquired Immune Deficiency Syndrome. VNA has operated a specialized subunit since 1984 which provides palliative care. This unit is staffed with registered nurses who are experienced in working in hospices, in symptom control for terminally ill patients and in providing supportive therapy for the patients and their families. In 1985 the palliative care unit provided services to about 129 patients; approximately 63 percent were Medicare patients and 10 percent were Medicaid patients. The program's average daily census was approximately 30 patients. In 1986 the palliative care unit provided service to approximately 134 patients; 68 percent Medicare patients and 14 percent Medicaid patients. The number of physicians referring patients to the palliative care unit has increased from fewer than 100 to more than 150 currently. Referring physicians include internists, surgeons, general practitioners and oncologists (physicians specializing in the treatment of cancer). After only three months of operation, the patient census reached 35 patients. The greatest concentration of the palliative care patients reside in the areas near North Broward Medical Center and Broward General Medical Center, which are also the areas with high indigent populations. VNA's palliative care unit will serve patients in Broward County who have physicians who are located in Dade County, and also will serve patients having no family members or others to serve as caretakers. It also has treated a number of terminally ill pediatric patients. The palliative care program is not as diverse a program as a hospice, in that it does not offer inpatient care or bereavement services to the families of the terminally ill, and the palliative care unit's access to funding from the government or third party payors is limited without a certificate of need to operate a hospice program. About 60 percent of the patients currently cared for in the palliative care unit would qualify for hospice services if VNA were authorized to provide those services. About 21 of VNA's home health patients chose to enter a hospice program out of the 263 patients seen during the first few years of operation of the palliative care unit. 2. Hospice, Inc. Hospice, Inc. is authorized to operate in Broward County, and has a 20-bed inpatient unit with an average daily census of 11 patients. About 10 percent of its services are inpatient services. Eleven percent of Hospice, Inc's patients are charity patients; that is, patients who are provided services without charge. Other patients have reimbursement sources which are not adequate to cover the cost of providing care. Hospice, Inc. does not discriminate on the basis of inability to pay. The two different kinds of indigent are those poor to start with and those who become medically indigent because they have paid all of their money to fight their disease. Hospice, Inc. has worked with AIDS patients since the early 1980's and has continually cared for AIDS patients, beginning with Haitian refugees. Hospice, Inc. has been called upon to write the policy and protocols for AIDS care for hospices nationally by the National Hospice Organization and is the only hospice in Florida with a specific contract to provide service to AIDS patients. That contract is with the State of Florida through Jackson Memorial Hospital and the Public Health Trust using State dollars. Hospice, Inc.'s programs in Dade and Broward Counties were selected as demonstration sites by the federal government to demonstrate the efficacy, including cost effectiveness, of hospice services, in a study conducted by the Health Care Financing Administration between 1980 and 1983. 3. Hospice Care Hospice Care is a not-for-profit hospice program licensed in Broward County which operates five inpatient beds. It does not have a parent company and is supported by donations raised in Broward County. It provides an array of nursing, pastoral and spiritual services to its patients and necessary medical care. The program has a Medical Director, Nurses Aides, Licensed Practical Nurses, a Coordinator of Education and Bereavement, a Director of Volunteers, and a Patient Care Coordinator. About 125 volunteers provide emotional support and assistance which a family might need while the patient is in the hospice program; the program offers the family ongoing bereavement support after the patient's death. Hospice Care also offers homemaker services, pharmaceutical services and occupational and physical therapists, at no extra cost to the patient. A pastor or minister provides spiritual assistance to the patient and family on request. Hospice Care accepts AIDS patients (it served approximately 17 in 1986) and provides support for families of those patients. Hospice Care also is developing a program to educate single people about AIDS. As is the case with other hospices, Hospice Care participates with the Robert Woods Johnson Foundation. Hospice Care provides educational materials regarding hospice programs throughout Broward County. Brochures are sent to physicians in Broward County four times a year. A newsletter is distributed quarterly. Hospice Care provides in service educational programs for its registered nurses and seminars for its social workers. Hospice Care accepts patients without regard to the patient's ability to pay, and places a patient in a program within 24 to 48 hours of referral. Hospice Care became Medicaid-certified in January of 1987 and accepts Medicaid patients. During fiscal year 1986, Hospice Care served 227 patients. It could serve additional patients without adding additional staff. During fiscal year 1986 approximately 25 patients treated by Hospice Care were referred to it from North Broward Hospital District hospitals. Based upon referral patterns, Hospice Care would probably lose some patients to VNA if VNA's application is approved. Hospice Care received at least one referral from VNA's palliative care unit last year. Hospice Care refers patients to other hospices in Broward and Palm Beach Counties based on the needs of those patients. 4. Hospice-By-The-Sea Another hospice operating in Broward County is Hospice-By-The-Sea. It has received a certificate of need and operates as a non-profit program. It was Medicare certified in January of 1987. Hospice-By-The-Sea accepts patients from Palm Beach and Broward counties, as it is authorized to do under its certificate of need. Its program is similar to that of Hospice Care and consists of nurses, social workers, clergy, volunteers, homemaker aides, home health aides, a clinical psychologist and a hospice physician. Its nurses receive specific training in the care of terminally ill children. Hospice-By-The-Sea has a bereavement program for family members for a minimum of one year following a patient's death. Hospice-By-The-Sea also offers the services of a dietician, a physical therapist, a speech therapist and an occupational therapist, as well as providing pharmacological and medical supplies and services. Pastoral counselors meet with patients and their families regularly. It has never denied a prospective patient admission to its program for inability to pay. The program accepts AIDS patients and works with the Robert Woods Johnson Foundation. During fiscal year 1986 Hospice-By-The-Sea served 263 patients, and had an average daily census of between 35 and 45 patients. It could increase the number of patients served without the increase in inpatient beds. Hospice-By-The-Sea does not have a waiting list and places new patients in its program within 24 to 48 hours after referral. Hospice-By-The-Sea refers patients to other hospices based upon the patient's need. Since about 1985 Hospice-By-The-Sea has had a program to educate the community about the availability of hospice services. The testimony of Ms. Webb, that the market for hospice services has leveled out, and now is saturated, is not accepted. In the Hospice-By-The-Sea program, inpatient beds play a minor role in its overall program. Only six patients since 1980 have used inpatient services. Volunteers are an important component of the Hospice-By-The-Sea program. About 25 to 30 percent of hospice volunteers reside in Broward County. Hospice-By-The Sea may experience some increase difficulty attracting volunteers if an additional hospice program is approved in Broward County but there is insufficient proof that it would not be able attract an adequate number of volunteers to continue a quality program. Hospice-By-The-Sea receives funds on an annual basis from Palm Beach and Broward county communities. About 30 percent of its fund raising monies comes from Broward County. The approval of the VNA hospice might make it somewhat more difficult for Hospice-By-The-Sea to attract funds. The Hearing Officer is not persuaded that competition for fund raising will result in either Hospice-By-The-Sea or VNA providing less than a quality program. 5. Hospice Of The Gold Coast Hospice Of The Gold Coast is another not-for-profit hospice which holds a certificate of need to serve Palm Beach and Broward counties which is Medicare certified. It has four licensed inpatient beds located at Holy Cross Hospital in Broward County. The hospice is licensed separately from its parent corporation, Gold Coast Home Health Services, a Broward County home health agency. As with the other hospices, the Gold Coast program offers a wide array of services to patients and their families. These include a medical director who serves as the consultant to the patient's primary care physician, who may assume total care for the patient when the primary physician chooses not to provide terminal care. Gold Coast has a team of nurses available 24 hours a day, seven days a week to meet the medical and psychological needs of patients. The nurses provide pain and symptom control, and are trained in providing psychological care to the patient and the patient's family. The Gold Coast home health aides provide personal and respite care to the patient. A psychologist provides counseling services to the patient and the family, while a bereavement specialist works under the direction of the hospice psychologist in a program which can last for a year or longer after the patient's death. Volunteers are trained to work with the terminally ill. Volunteers are an integral part of the hospice team. Gold Coast has 80 active volunteers. Clergymen on Gold Coast staff provide spiritual care to the patient and family. A medical social worker sees each family to be sure that community resources available to the patient and family are obtained. Gold Coast offers homemaker services which are used to maintain the patient's household. Physical therapy services are provided if required by a patient. Hyperalimentation can also be provided if needed. Hyperalimentation is a supplemental feeding done intravenously. The hospice may also provide morphine drips for pain control where required. Gold Coast accepts patients terminally ill from the AIDS virus, and has no policy which would discourage the admission of such patients. It participates in the activities funded to the Robert Woods Johnson Foundation in the southeast Florida area for AIDS patients. During calendar year 1986 Gold Coast received about 26 patient referrals from North Broward Hospital District hospitals. During calendar year 1986 Gold Coast served 304 patients and had an average daily census of between 50 to 55. A substantial number of additional patients could be served without adding additional inpatient beds, for only five percent of the patients served used inpatient beds. About 15 to 20 additional patients could be served without adding additional staff. Gold Coast does not experience a waiting list of patients and serves them within 24 hours after a physician's referral. Gold Coast will refer patients to other hospices in Broward and Palm Beach Counties if those hospices are closer and therefore could better meet the patient's needs. Gold Coast Home Health Agency provides administrative and other support to the Gold Coast hospice. The experience of Gold Coast in admission to its hospice program of those served by the home health agency is that many patients eligible for hospice services do not wish to obtain them. In 1986, of 139 patients the home health agency served with diagnoses which would make them eligible for hospice services, 39 chose the hospice program. Gold Coast makes efforts to educate the community about the availability of hospice services. Methods include lectures given by the hospice's executive director to local nursing college students and to psychology courses on death and dying. Gold Coast also publishes a newsletter distributed throughout the community and participates in health fairs, distributing brochures on hospice care. Factual Findings Concerning Rule Criteria Against Which The Application Must Be Evaluated Rule 10-5.011(1)(j), Florida Administrative Code, contains the rule methodology governing hospice services. It is the same methodology used by the U.S. Office of Management and Budget and other states in determining the appropriate level of hospice care in a community. All parties have stipulated that this methodology shows a need for five additional hospice beds in Broward County. The Broward Regional Health Planning Council calculates a need for 45.8 hospice beds in Broward County. With the current hospice beds of Hospice Care, Hospice-Of The Gold Coast, Hospice, Inc., and Hospice-By-The-Sea, there are 33 beds now licensed. The rule methodology understates the actual need for hospice services. It was developed before the increased number of terminally ill patients as a result of Acquired Immunity Deficiency Syndrome. Twenty percent of all AIDS patients in Florida are Broward County residents. The representatives of Hospice-By-The-Sea, Hospice Care and Hospice Of The Gold Coast all anticipate an increased need for hospice services for AIDS patients in Broward County. The incidence of cancer is substantially higher in Broward County than in Florida generally. Broward County's population is older than the national population. Twelve percent of the population nationwide is over age 65. Almost 24 percent of Broward County's population is over 65. The most current reliable data available demonstrates that the hospice-eligible population exceeds the population now being served. The rule methodology would indicate there should be at least 400 hospice-eligible patients more than are actually being served currently. Unlike rule methodologies for other health services, minimum utilization thresholds do not apply to hospice services. The inpatient component of the hospice program is used for acute care and respite care. The availability of the beds at times of peak demand is more important than the average daily census of inpatient hospice beds filled on a given day. Statutory Criteria For Evaluating The Application Under Section 381.494(6)(c), Florida Statutes. Consistency with the State Health Plan and the Local Health Plan. Section 381.494(6)(c)1., Florida Statutes. The State Health Plan does not address the need for hospice services. The testimony and cross-examination of Kurt Blair, the planning supervisor for the Broward Regional Health Planning Council, establishes that the VNA proposal is not inconsistent with the Local Health Plan. Availability, Utilization, Efficiency, Geographic And Economic Accessibility Of Facilities In The District. Section 381.494(6)(c)2., Florida Statutes. The utilization of hospice services in Broward County is less than the rule methodology would project. The first step of the methodology estimates a hospice eligible population, and that estimate is that between 1,400 and 1,450 people are hospice eligible. Currently, approximately 955 are being provided hospice care. Thus, under the rule methodology there are approximately 400 people in Broward County who are hospice eligible and who may be receptive to hospice services if appropriate additional education were provided. In addition, the second portion of the rule which determines hospice inpatient bed need shows the need for at least the five additional inpatient beds which this application proposes. The rule utilizes the assumption that about 20 percent of hospice patients will be inpatients. In Broward County, only about 10 percent are inpatients. Unlike rule methodologies for other health services, the hospice rule does not use minimum utilization thresholds as a proxy for quality, or for financial viability. The fact that current utilization of inpatient beds is less than the rule would predict does not mean there is not a need for additional programs in Broward County. The reason for the lower inpatient utilization in Broward is not clear but inpatient services are only a portion of the total continuum of services provided by a hospice, so that the lower inpatient utilization cannot be properly thought to show a lack of need. The VNA will operate hospice education for groups that are currently underserved, especially indigents. VNA provides a substantial amount of care to indigents, providing over $740,000 of free care in 1986. Physicians refer a substantial number of indigent patients to VNA for services. VNA's ability to provide care to indigents is enhanced by the array of services that VNA offers through the VNA network. Moreover, the indigent patient population has less awareness of the availability of hospice services, and increased education regarding these services for both patients and their physicians is likely to result in additional persons choosing hospice care. VNA's palliative care unit's physician referral base is highly concentrated in the geographic areas close to the North Broward Hospital and Broward General Medical Center, which are operated by the North Broward Hospital District. An unmet need for hospice services exists in the geographic area served by the North Broward Hospital District, especially in zip code area 33311, which has a high concentration of indigent persons. The VNA hospice would be more accessible because it will accept patients without an identified family member or care giver to assist in the program, while other hospices believe that such patients are not appropriate for hospice care. Other hospices also will not accept a patient whose physician is located in Dade County. When a physician refers a patient to VNA for care, options are discussed with the patient. If the VNA cannot give appropriate care and the patient chooses another community provider, the patient is referred to another provider of care. While other providers do exist in Broward County to serve the unmet need for hospice services in Broward County, VNA's existing relationships with the North Broward Hospital District and physicians serving indigent patients positions it especially well to serve that need. The Ability To Provide Quality Care, Section 381.494(6)(c)3., Florida Statutes. VNA employs several registered nurses with hospice experience who are well qualified to provide a hospice program. Registered nurses are the backbone of the hospice program because they are responsible for pain and symptom control, providing emotional support to patients and families, and education regarding medications. VNA therefore has an existing corps of nursing staff from which the hospice program could begin. Moreover, VNA's palliative care unit provides a quality program which is similar to (though more limited than) a hospice program, which also gives reason to believe it can provide a quality program. The VNA program will also foster a continuity of care because patients have ready access to other VNA programs, and all programs have uniform recordkeeping and assessment techniques. The VNA conducts inter-team conferences to ensure continuity of care between programs. This continuity is helpful because it avoids the dislocations which can occur when a patient and family begin to be served by a different provider after the decision to utilize hospice care has been made. Economies of Scale. Section 381.494(6)(c)5., Florida Statutes. The VNA network will help create an efficient hospice program since management services such as accounting, marketing, billing and collection, and administration are done by the parent organization which spreads the cost of these services across the subsidiaries while avoiding duplication of effort. The placement of the proposed hospice program within the VNA network allows it to benefit from the economies of scale that result from such organization. The presence of VNA community liaisons within the North Broward Hospital District facilities should also increase the efficiency by which VNA can guide patients appropriately into hospice programs earlier which should lower the overall cost of in-hospital care. Availability Of Resources For Project Accomplishment And Operation. Section 381.494(6)(c)8., Florida Statutes. The VNA has been very successful in obtaining grants and other forms of financial assistance from a variety of local, state and federal sources including the Area-wide Agency on Aging and the Community Care For the Elderly Program. The fundraising mechanism for the VNA, the VNA Foundation, raised $31,000 in private contributions in 1986, and it is projected that this amount will increase as a result of implementation of more aggressive fundraising activities. The Visiting Nurse Association movement in the United States has historically been heavily supported by the United Way. The VNA received $273,000 from the Broward County United Way in both 1985 and 1986 and anticipates receiving approximately $300,000 for 1988. Susan Telli, Executive Director of Hospice Care of Broward, acknowledged VNA's strong fundraising capacity. The VNA initially anticipates receiving funds for its hospice program from the United Way and the VNA Foundation. The VNA would be able to handle any unanticipated decrease in revenue or unanticipated increase in expenses through the solicitation of additional charitable contributions or renegotiations of its hospital contract. Financial Feasibility In The Short And Long Terms. Section 381.494(6)(c)9., Florida Statutes. The VNA hospice program is financially feasible in both the short term and long term. The project involves no capital expenditure. Mr. Robert Simione is an expert in health care financial planning and management, and is a principal with Simione and Simione, a certified public accounting firm. Many of the firm's clients are home health agency and hospices. Mr. Simione has extensive experience in the development of hospice programs including budgeting, financial feasibility analysis and financial management. He has recently completed an extensive survey of ten hospices nationwide. Subsequent to VNA's preparation and submission of its hospice certificate of need application, Simione and Simione merged with- the accounting firm of Holstein and Lechner, which therefore had not been involved in either the preparation or submission of the certificate of need application. In November, 1986, after Simione and Simione merged with Holstein and Lechner, the VNA asked Mr. Simione to conduct a feasibility analysis of its proposed hospice program in preparation for both the final hearing and implementation of the program, and to account for extrinsic changes that occurred subsequent to the preparation and submission of the application in October of 1985. The extrinsic changes included an increase in Medicare reimbursement rates for hospice services on or about April 1, 1986, and the availability of Medicaid reimbursement for hospice services in Florida as of January 1, 1987. 1. Patient Census Projections The VNA hospice application, filed with the Department in October of 1985, included a two-year financial projection. The projection was broken into two periods and assumed a projected patient census of 30 for the first six months of operation and 50 thereafter for the next 18 months. Mr. Simione's reliance at final hearing on an anticipated census of 40 during the second period of the analysis (rather than 50) was based on management decisions, and was not intended to reflect the availability of patients or need for hospice services. The proposed patient census in the application is reasonable as a result of the following: The VNA is not starting from "ground zero"; it has systems in place and existing resources and capabilities that would facilitate development of a high quality hospice program. The VNA has experience in implementing its palliative care unit, including community education. The VNA has existing ties and relationships with various charitable and other organizations in Broward County, as well as Dade County. Since 1952, the VNA has historically had large numbers of patient and family contacts throughout Broward County. The VNA has mature relationships with publicly funded entities such as the Public Health Department. Other hospices in Broward County have realized significant patient growth experience during the previous two years. Broward County's morbidity and mortality rates demonstrate demand for hospice services. 2. Outpatient-Inpatient Ratio The VNA hospice certificate of need application, filed with the Department in October of 1985, included financial projections assuming an 80 percent outpatient population and 20 percent inpatient population (80:20 ratio). Projected out-patient to inpatient care ratio of 80:20 reflects a Medicare-imposed ceiling for inpatient care. A 90:10 ratio is more likely in Broward County. The proposed 80:20 ratio is reasonable for planning purposes because: The VNA's existing palliative care unit's statistical experience reflects high inpatient utilization by these patients. The VNA's historical experience with the North Broward Hospital District, as a result of a demonstration project and otherwise, reflects longer hospitalization for Broward patients that come from low income families, often due to their overall poor health status, both nutritionally and physically. The federal government, based on the results of a Medicare demonstration project, has adopted regulations that allow for an 80:20 inpatient hospital ratio for hospice programs. Certificate of need applications recently submitted by other applicants for hospice programs in Broward County utilized an 80:20 ratio. Indeed, Hospice, Inc.'s certificate of need application filed in 1980 projected an outpatient-inpatient ratio of 80:20. The proposed 80:20 ratio had been commonly used by other hospices for financial planning at the time the VNA prepared its certificate of need application. The survey conducted by Mr. Simione revealed that the inpatient utilization component of a participating hospice was as high as 19 percent. 3. Revenue Projections The experience of the palliative care unit supports the VNA's projected payor mix for its hospice program as indicated by the 1986 VNA breakdown by payor source: Medicare 76.8 percent Medicaid 9.0 percent Private Insurance 6.1 percent Private Pay 5.6 percent (sliding scale used) Veteran's Administration 1.2 percent The payor mix projected by Mr. Simione for the VNA hospice is as follows: Medicare 75 percent Medicaid 7 percent Insurance and Private Pay 10 percent Indigent 8 percent Mr. Simione's projections regarding payor mix are not significantly different from those set forth in the VNA certificate of need application, and reflect the availability of Medicaid funding for hospice care. The VNA's projection that ten percent of its projected revenue will be "insurance and private pay" is reasonable because: The amount is supported by VNA's history and the projections of other visiting nurse associations that have recently established hospice programs. An increasing number of private and commercial insurance carriers, including carriers providing coverage in Broward County, are offering hospice benefits. Hospice, Inc. projected that 11 percent of revenue would be "insurance and private pay" in its application for hospice beds in Palm Beach County. As many as 35 percent of Hospice Care of Broward's patients are privately insured for hospice services. Ten percent of Hospice-By-The Sea patient census is composed of private pay patients. The VNA's projections regarding Medicare and Medicaid reimbursement are reasonable in light of the following: As testified by Ella Charland, Executive Director of Hospice Of The Gold Coast, 90 percent of its patients are Medicare reimbursable. Contractual adjustments are not normally considered for projected Medicare revenues since Medicare reimburses hospice on a prospective flat rate. A 2.5 percent Medicare and/or 5 percent Medicaid contractual allowance, if necessary, will not have a significant impact on the financial feasibility of the VNA's proposed hospice program. Use of a wage index of 1.11249 as opposed to 1.1105 in calculating Medicare or Medicaid rates amounts to a difference of .0079 percent of total revenue in Mr. Simione's financial feasibility study. The impact of a .0079 percent discrepancy in calculating Medicare and Medicaid rates for the VNA's proposed hospice program is insignificant. 4. Other Projections The projection of an average length of stay (ALOS) of either 45 or 50 days for a hospice program is consistent with the national average for hospices as stated by the National Hospice Organization and with a survey done by the CPA firm of Simione and Simione. Ambulance costs are not normally a "line item" in a hospice's budget, but if there were any, they would be insignificant in light of its overall operation. The VNA's projection of a .25 full-time equivalent (FTE) for an M.D. Consultant is consistent with projections relied on by other hospices and not violative of any state or federal requirements. The VNA's hospice program does not require an Inpatient RN Coordinator position or a full-time Admissions Assistant since responsibilities inherent in these positions could be assumed by employees budgeted for by the VNA. Impact of VNA Hospice Section 381.494((6)(c)12., Florida Statutes Reverend Westbrook does not believe "...that one single organization could do a good job of caring for all the hospice patients." The VNA will be a positive competitive force vis-a-vis quality, accessibility to indigents, public education, cost effectiveness, and training. Mr. Gates acknowledges that the entry of a new competitor will generally not have a negative effect on existing providers when the new competitor meets unmet needs or provides services the existing providers are not designed to meet. Competition and Regional Monopolies. Section 381.494(3), Florida Statutes. Statutory Intent The only health service for which the Florida statutes explicitly encourage competition and discourage regional monopolies is hospice care. Section 381.494(3), Florida Statutes, encourages competitive forces in the market. The statute provides that the state need methodology should discourage regional monopolies and promote competition. Existing Market Share Hospice, Inc., the largest of all existing hospice competitors in Broward, has captured 60 percent of the Broward County hospice market, and has a market share that is greater than all three existing competitors combined. Hospice Care of Broward retains 16.4 percent of the market share in Broward County. Hospice Gold Coast retains approximately 20.6 percent of the market share in Broward County. Hospice-By-The-Sea retains less than four percent of the market share in Broward County. Hospice, Inc. has obtained certificate of need approval for hospice programs in Broward, Dade and Monroe Counties. Hospice, Inc. is the only hospice in Dade County. Hospice, Inc. has filed a certificate of need application for two hospice beds in Palm Beach County. Hospice, Inc. intends to open and operate additional hospices. HCI, Hospice, Inc.'s management corporation, was capitalized in 1983 for $3.5 million. Venture capitalists who invested in HCI anticipate a reasonable return on their investment. Accordingy, there exists an expectation that profits are to be maximized by HCI, and its related entities, including Hospice, Inc. Hospice, Inc.'s Income Statement dated September 30, 1986, for Hospice, Inc.'s Broward division for fiscal year ending 9/30/85 reflects the following: Total Revenue $1,445,032.28 Total Operating Expenses 1,252,065.18 Division Income $ 192,967.10 Hospice, Inc.'s Income Statement dated September 30, 1986, for Hospice, Inc.'s Broward division fiscal year ending 9/30/86 reflects the following: Total Revenue $2,773,242.48 Total Operating Expenses 2,568,972.14 Division Income $204,270.34 Hospice, Inc. experienced a 92 percent increase in the total revenue from fiscal year ending 9/30/85 to fiscal year ending 9/30/86. In addition to management fees, Hospice, Inc. incurs substantial managerial and administrative costs relating to salaries and wages, director's fees, contract services, and consulting fees.
Recommendation It is RECOMMENDED that a certificate of need be granted to VNA to operate a hospice program in Broward County, which includes five inpatient beds. DONE AND ORDERED this 31st day of December, 1987, at Tallahassee, Florida. WILLIAM R. DORSEY, JR. Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 31st day of December, 1987. APPENDIX TO RECOMMENDED ORDER The following are my rulings on the proposed findings of fact submitted by the parties pursuant to Section 120.59(2) Florida Statutes (1985). As a preliminary matter I am constrained to point out that I generally found the testimony of the witnesses for VNA persuasive. While the testimony of the opponents was no doubt sincere, it was colored by undue pessimism about their ability to operate in a more competitive environment but the reasons stated for their fears about licensure of an additional competitor were unpersuasive. While initially the Hearing Officer had some doubt about the financial viability of the project, after a review of the testimony of Mr. Semeoni I am satisfied that the reasons he gave to support his opinion that the project is financially viable and the short and long term, and that the projections found in the application are reasonable, is credible, and should be accepted. In rulings on the proposals filed by VNA and HRS. Rejected as unnecessary. Covered in Finding of Fact 1 Covered in Finding of Fact 21. Covered in Finding of Fact 16. Covered in Finding of Fact 103. Covered in Finding of Fact 112. Rejected as unnecessary. 8-10. Covered in Finding of Fact 2. 11-13. Covered in Finding of Fact 3. Covered in Finding of Fact 4. Covered in Finding of Fact 5. Covered in Finding of Fact 6. Covered in Finding of Fact 7. Covered in Finding of Fact 8. Covered in Finding of Fact 9. 20-22. Covered in Finding of Fact 10. 23. Covered in Finding of Fact 11. 24-27. Covered in Finding of Fact 12. 28-29. Covered in Finding of Fact 13. Covered in Finding of Fact 14. Covered in Finding of Fact 15. Rejected as unnecessary. Covered in Finding of Fact 79. Rejected as subordinate to Finding of Fact 71. Covered in Finding of Fact 84. Rejected as subordinate to Finding of Fact 84. 37-40. Rejected as unnecessary. 41-42. Covered in Finding of Fact 53. 43. Covered in Finding of Fact 54. 44-45. Covered in Finding of Fact 55. 46-49. Covered in Finding of Fact 56. 50-52. Covered in Finding of Fact 57. 53-55. Covered in Finding of Fact 61. 56-57. Rejected as a recitation of testimony not a finding of fact. 58-59. Covered in Finding of Fact 59. 60. Rejected as unnecessary. 61-64. Covered in Finding of Fact 63. 65. Rejected as redundant. 66-67. Covered in Finding of Fact 63. 68-73. Rejected as unnecessary. 74-75. Covered in Finding of Fact 64. 76. Rejected as redundant. 77-80. Covered in Finding of Fact 65. Covered in Finding of Fact 66. Covered in Finding of Fact 60. 83-88. Covered in Finding of Fact 60. 89-91. Rejected as unnecessary. 92-103. Rejected because there are no adequate alternatives to hospice care for persons in need of hospice care. The findings are therefore unnecessary. See Conclusions of Law concerning section 381.494(6)(c)4. 104-105. Rejected as unnecessary. 106. Covered in Findings of Fact 10 and 68. 107-108. Covered in Finding of Fact 69. 109-119. Rejected as unnecessary. 120-122. Covered in Finding of Fact 70. 123-125. Rejected as unnecessary. Covered in Finding of Fact 72. Covered in Finding of Fact 71. Rejected as redundant. Covered in Finding of Fact 79. Covered in Finding of Fact 80. Covered in Finding of Fact 81. Covered in Finding of Fact 82. Rejected as unnecessary. Covered in Finding of Fact 83. 135-136. Covered in Finding of Fact 84. Rejected as cumulative to Finding of Fact 79. Covered in Finding of Fact 85. Covered in Finding of Fact 86. Covered in Finding of Fact 87. Rejected as unnecessary. Covered in Finding of Fact 88. Covered in Finding of Fact 89. Covered in Finding of Fact 90. Covered in Finding of Fact 91. Covered in Finding of Fact 92. Covered in Finding of Fact 93. Covered in Finding of Fact 94. Covered in Finding of Fact 95. Covered in Finding of Fact 96. 151-152. Covered in Finding of Fact 97. Covered in Finding of Fact 98. Covered in Finding of Fact 99. Covered in Finding of Fact 73. Covered in Finding of Fact 74. Covered in Finding of Fact 75. Covered in Finding of Fact 76. Rejected as unnecessary. Covered in Finding of Fact 76. Covered in Finding of Fact 77. Covered in Finding of Fact 78. Covered in Finding of Fact 103. Covered in Finding of Fact 104. Covered in Finding of Fact 105. Covered in Finding of Fact 106. Covered in Finding of Fact 107. Covered in Finding of Fact 108. Covered in Finding of Fact 109. Covered in Finding of Fact 110. Covered in Finding of Fact 111. Covered in Finding of Fact 112. Covered in Finding of Fact 113. Covered in Finding of Fact 114. 175-176. Rejected as unnecessary. Covered in Finding of Fact 115. Covered in Finding of Fact 100. Covered in Finding of Fact 101. Covered in Finding of Fact 102. Rulings on Finding of Fact proposed by Hospice Care of Broward County, Inc. Rejected as inapplicable. Covered in the Conclusions of Law. 3-4. Covered in Finding of Fact 40. 5-6. Rejected as unnecessary. Covered in Finding of Fact 41. Covered in Finding of Fact 42. Covered in Finding of Fact 43. Covered in Finding of Fact 44. Covered in Finding of Fact 45. Covered in Finding of Fact 45. Covered in Finding of Fact 46. Covered in Finding of Fact 47, to the extent necessary. Covered in Finding of Fact 48. Rejected as unnecessary. 17-18. Covered in Finding of Fact 49. Covered in Findings of Fact 50 and 51. Covered in Finding of Fact 52. Rejected because the new hospice, while in competition with hospice of the Gold Coast which necessarily means that its programs would duplicate those of Gold Coast. 22-24. Rejected as unnecessary. Covered in Finding of Fact 30. Covered in Finding of Fact 31. Covered in Finding of Fact 32. Covered in Finding of Fact 33. Covered in Finding of Fact 34. Covered in Finding of Fact 35. Covered in Finding of Fact 36. Covered in Finding of Fact 37. Covered in Finding of Fact 38. Covered in Finding of Fact 39. Rejected as unnecessary. 36-37. Covered in Finding of Fact 21. Covered in Findings of Fact 21, 22, and 23. Covered in Finding of Fact 24. Covered in Finding of Fact 25. Covered in Finding of Fact 26. Covered in Finding of Fact 27. Covered in Finding of Fact 28. Covered in Finding of Fact 29. Rulings on proposed findings of fact from Hospice, Inc. Rejected as unnecessary. Covered in Findings of Fact 2, 16, 21, 40, and 55. Rejected because whether Broward has fewer or more hospices than other counties, HRS service districts or more per person than any county is not relevant, the relevant considerations are those set forth in applicable statutes and rules. Covered in Finding of Fact 54 or rejected as unnecessary. Rejected because I have found the need for an additional hospice program. Rejected for the reasons stated in Finding of Fact Rejected inconsistent with my view of the evidence. Rejected as unnecessary. Rejected for the reasons stated in Finding of Fact Covered in Finding of Fact 49, to the extent necessary. 11-12. Covered in Finding of Fact 27, to the extent necessary. Rejected as argument, not a finding of fact. Rejected as inconsistent with my view of the testimony of Mr. Blair. The local plan does not state that there is a need for a hospice in South Broward, but that if there were two competing applications, preference would be given to the hospice proposing to locate in South Broward, which is not at issue here. Covered in Finding of Fact 60. Rejected as inconsistent with my view of the evidence. Rejected for the reasons given for rejecting finding of fact 3. Rejected as unnecessary. Rejected as unnecessary, the criteria for approving a new hospice is not that existing hospices must have waiting lists. Rejected as unnecessary. To the extent necessary covered in Finding of Fact 87(f). Rejected as unnecessary. To the extent that Broward presents a "not normal" situation, see Findings of Fact 56 and 57. Rejected as unnecessary. Rejected as a recitation of testimony not a finding of fact. Rejected as unnecessary. Covered in Finding of Fact 15. Rejected as recitation of testimony not a finding of fact. Rejected for the reasons stated in Findings of Fact 61 through 67. Rejected as unnecessary because I do not believe that the VNA application should be approved because of unique "high tech" care to be available from it alone. Rejected as unnecessary. To the extent necessary covered in Finding of Fact 17. Covered in Finding of Fact 18. Covered in Finding of Fact 19. 34a. Covered in Finding of Fact 20. Rejected as unnecessary. Rejected as cumulative to the Finding of Fact made in the description of the parties for each of the existing hospices. Rejected as inconsistent with my view of the evidence. Rejected as inconsistent with my view of the evidence. Rejected because hospices may be approved without evidence of "serious problems" seeking admission to hospice programs. Rejected as inconsistent with the evidence which I have credited. See Findings of Fact 73 through 78. Rejected because I do not accept Mr. Nelson's premise that approval of additional hospice means that that a new hospice will have to cut into the existing market share of current hospices. The rule methodology provides reason to believe that there is a substantial pool of unmet need from which patients may be drawn. Rejected as unnecessary. Rejected because I do not share Hospice Care's pessimistic view of the potential loss of revenue it would experience if the VNA hospice were granted. As a general matter, I found the testimony of Mr. Simeone on the reasonableness of the projections in the VNA more persuasive than the criticisms of the application by Reverend Westbrook. No useful purpose will be served by going through a line by line analysis of proposed findings 46 through 92 which generally relate to criticism of the financial projections made by VNA because I have resolved the disputes in favor of VNA's application and against the criticisms of the application raised by Hospice. Inc. The projections of VNA is financially feasible in the long and short terms. See Findings of Fact 79 through 99. COPIES FURNISHED: Howard Hochman, Esquire Gerald M. Cohen, Esquire Wood, Lucksinger & Epstein 200 South Biscayne Boulevard Suite 3700 Miami, Florida 33131-2359 Kenneth Hoffman, Esquire Martha Edenfield, Esquire OERTEL & HOFFMAN, P.A. 2700 Blair Stone Road Post Office Box 6507 Tallahassee, Florida 32314-6507 John Rodriguez, Esquire Department of Health and Rehabilitative Services 1323 Winewood Boulevard Building One, Room 407 Tallahassee, Florida 32399-0700 Sam Power, Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Building One, Room 407 Tallahassee, Florida 32399-0700 John Miller, Esquire Acting General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 Charles Stampelos, Esquire 215 South Monroe Street Suite 666 Tallahassee, Florida 32301 Gregory L. Coler, Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 =================================================================
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 The issues in this case are whether the Agency for Health Care Administration (AHCA) should grant Hospice Integrated’s Certificate of Need (CON) Application No. 8406 to establish a hospice program in AHCA Service Area 7B, CON Application No. 9407 filed by Wuesthoff, both applications, or neither application.
Findings Of Fact Hospice Hospice is a special way of caring for patients who are facing a terminal illness, generally with a prognosis of less than six months. Hospice provides a range of services available to the terminally ill and their families that includes physical, emotional, and spiritual support. Hospice is unique in that it serves both the patient and family as a unit of care, with care available 24 hours a day, seven days a week, for persons who are dying. Hospice provides palliative rather than curative or life- prolonging care. To be eligible for hospice care, a patient must have a prognosis of less than six months to live. When Medicare first recognized hospice care in 1983, more than 90% of hospice cases were oncology patients. At that time, there was more information available to establish a prognosis of six months or less for these patients. Since that time, the National Hospice Organization (“NHO”) has established medical guidelines which determine the prognosis for many non-cancer diseases. This tool may now be used by physicians and hospice staff to better predict which non- cancer patients are eligible for hospice care. There is no substitute for hospice. Nothing else does all that hospice does for the terminally ill patient and the patient’s family. Nothing else can be reimbursed by Medicare or Medicaid for all hospice services. However, hospice must be chosen by the patient, the patient’s family and the patient’s physician. Hospice is not chosen for all hospice-eligible patients. Palliative care may be rejected, at least for a time, in favor of aggressive curative treatment. Even when palliative care is accepted, hospice may be rejected in favor of home health agency or nursing home care, both of which do and get reimbursed for some but not all of what hospice does. Sometimes the choice of a home health agency or nursing home care represents the patient’s choice to continue with the same caregivers instead of switching to a new set of caregivers through a hospice program unrelated to the patient’s current caregivers. There also is evidence that sometimes the patient’s nursing home or home health agency caregivers are reluctant, unfortunately sometimes for financial reasons, to facilitate the initiation of hospice services provided by a program unrelated to the patient’s current caregivers. Existing Hospice in Service Area 7B There are two existing hospice providers in Service Area 7B, which covers Orange County and Osceola County: Vitas Healthcare Corporation of Central Florida (Vitas); and Hospice of the Comforter (Comforter). Vitas Vitas began providing services in Service Area 7B when it acquired substantially all of the assets of Hospice of Central Florida (HCF). HCF was founded in 1976 as a not-for-profit organization and became Medicare-certified in 1983. It remained not-for-profit until the acquisition by Vitas. In a prior batching cycle, HCF submitted an application for a CON for an additional hospice program in Service Area 7B under the name Tricare. While HCF also had other reasons for filing, the Tricare application recognized the desirability, if not need, to package hospice care for and make it more palatable and accessible to AIDS patients, the homeless and prisoners with AIDS. HCF later withdrew the Tricare application, but it continued to see the need to better address the needs of AIDS patients in Service Area 7B. In 1994, HCF began looking for a “partner” to help position it for future success. The process led to Vitas. Vitas is the largest provider of hospice in the United States. Nationwide, it serves approximately 4500 patients a day in 28 different locations. Vitas is a for-profit corporation. Under a statute grandfathering for-profit hospices in existence on or before July 1, 1978, Vitas is the only for-profit corporation authorized to provide hospice care in Florida. See Section 400.602(5), Fla. Stat. (1995). HCF evaluated Vitas for compatibility with HCF’s mission to provide quality hospice services to medically appropriate patients regardless of payor status, age, gender, national origin, religious affiliation, diagnosis or sexual orientation. Acquisition by Vitas also would benefit the community in ways desired by HCF. Acquisition by Vitas did not result in changes in policy or procedure that limit or delay access to hospice care. Vitas was able to implement staffing adjustments already contemplated by HCF to promote efficiencies while maintaining quality. Both HCF and Vitas have consistently received 97% satisfaction ratings from patients’ families, and 97% good-to- excellent ratings from physicians. Initially, Vitas’ volunteer relations were worse than the excellent volunteer relations that prevailed at HCF. Many volunteers were disappointed that Vitas was a for-profit organization, protested the proposed Vitas acquisition, and quit after the acquisition. Most of those who quit were not involved in direct patient care, and some have returned after seeing how Vitas operates. Vitas had approximately 1183 hospice admissions in Service Area 7B in 1994, and 1392 in 1995. Total admissions in Service Areas 7B and 7C (Seminole County) for 1995 were 1788. Comforter Hospice of the Comforter began providing hospice care in 1990. Comforter is not-for-profit. Like Vitas, it admits patients regardless of payor status. Comforter admitted approximately 100 patients from Service Area 7B in 1994, and 164 in 1995. Total admissions in Service Areas 7B and 7C for 1995 were 241. For 1996, Comforter was expected to approach 300 total admissions (in 7B and 7C), and total admissions may reach 350 admissions in the next year or two. As Comforter has grown, it has developed the ability to provide a broader spectrum of services and has improved programs. Comforter provides outreach and community education as actively as possible for a smaller hospice. Comforter does not have the financial strength of Vitas. It maintains only about a two-month fiscal reserve. Fixed Need Pool On February 2, 1996, AHCA published a fixed need pool (FNP) for hospice programs in the July 1997 planning horizon. Using the need methodology for hospice programs in Florida found in F.A.C. Rule 59C-1.0355 (“the FNP rule”), the AHCA determined that there was a net need for one additional hospice program in Service Area 7B. As a result of the dismissal of Vitas’ FNP challenge, there is no dispute as to the validity of the FNP determination. Other Need Considerations Despite the AHCA fixed need determination, Vitas continues to maintain that there is no need for an additional hospice program in Service Area 7B and that the addition of a hospice program would adversely impact the existing providers. Essentially, the FNP rule compares the projected need for hospice services in a district using district use rates with the projected need using statewide utilization rates. Using this rule method, it is expected that there will be a service “gap” of 470 hospice admissions for the applicable planning horizon (July, 1997, through June, 1988). That is, 470 more hospice admissions would be expected in Service Area 7B for the planning horizon using statewide utilization rates. The rule fixes the need for an additional hospice program when the service “gap” is 350 or above. It is not clear why 350 was chosen as the “gap” at which the need for a new hospice program would be fixed. The number was negotiated among AHCA and existing providers. However, the evidence was that 350 is more than enough admissions to allow a hospice program to benefit from the efficiencies of economy of scale enough to finance the provision for enhanced hospice services. These benefits begin to accrue at approximately 200 admissions. Due to population growth and the aging of the population in Service Area 7B, this “gap” is increasing; it already had grown to 624 when the FNP was applied to the next succeeding batching cycle. Vitas’ argument ignores the conservative nature of several aspects of the FNP rule. It uses a static death rate, whereas death rates in Service Area 7B actually are increasing. It also uses a static age mix, whereas the population actually is aging in Florida, especially in the 75+ age category. It does not take into account expected increases in the use of hospice as a result of an environment of increasing managed health care. It uses statewide conversion rates (percentage of dying patients who access hospice care), whereas conversion rates are higher in nearby Service Area 7A. Finally, the statewide conversions rates used in the rule are static, whereas conversion rates actually are increasing statewide. Vitas’ argument also glosses over the applicants’ evidence that the addition of a hospice program, by its mere presence, will increase awareness of the hospice option in 7B (regardless whether the new entrant improves upon the marketing efforts of the existing providers), and that increased awareness will result in higher conversion rates. It is not clear why utilization in Service Area 7B is below statewide utilization. Vitas argued that it shows the opposite of what the rule says it shows—i.e., that there is no need for another hospice program since the existing providers are servicing all patients who are choosing hospice in 7B. Besides being a thinly-veiled (and, in this proceeding, illegal) challenge to the validity of the FNP rule, Vitas’ argument serves to demonstrate the reality that, due to the nature of hospice, existing providers usually will be able to expand their programs as patients increasingly seek hospice so that, if consideration of the ability of existing providers to fill growing need for hospice could be used to overcome the determination of a FNP under the FNP rule, there may never be “need” for an additional program. Opting against such an anti-competitive rule, the Legislature has required and AHCA has crafted a rule that allows for the controlled addition of new entrants into the competitive arena. Vitas’ argument was based in part on the provision of “hospice-like” services by VNA Respite Care, Inc. (VNA), through its home health agency. Vitas argued that Service Area 7B patients who are eligible for hospice are choosing VNA’s Hope and Recovery Program. VNA’s program does not offer a choice from, or alternative to, hospice. Home health agencies do not provide the same services as hospice programs. Hospice care can be offered as the patient’s needs surface. A home health agency must bill on a cost per visit basis. If they exceed a projected number of visits, they must explain that deviation to Medicare. A home health agency, such as VNA, offers no grief or bereavement services to the family of a patient. In addition to direct care of the patient, hospice benefits are meant to extend to the care of the family. Hospice is specifically reimbursed for offering this important care. Hospice also receives reimbursement to provide medications relevant to terminal illnesses and durable medical equipment needed. Home health agencies do not get paid for, and therefore do not offer, these services. It is possible that VNA’s Hope and Recovery Program may be operating as a hospice program without a license. The marketing materials used by VNA inaccurately compare and contrast the medical benefits available for home health agencies to those available under a hospice program. The marketing material of VNA also inappropriately identify which patients are appropriate for hospice care. VNA’s Hope and Recovery Program may help explain lower hospice utilization in Service Area 7B. Indeed, the provision of hospice-like services by a non-hospice licensed provider can indicate an unmet need in Service Area 7B. The rule does not calculate an inventory of non-hospice care offered by non-hospice care providers. Instead, the rule only examines actual hospice care delivered by hospice programs. The fact that patients who would benefit from hospice services are instead receiving home health agency services may demonstrate that existing hospice providers are inadequately educating the public of the advantages of hospice care. Rather than detract from the fixed need pool, VNA’s provision of “hospice-like” services without a hospice license may be an indication that a new hospice provider is needed in Service Area 7B. Although a home-health agency cannot function as a hospice provider, the two can work in conjunction. They may serve as a referral base for one another. This works most effectively when both programs are operated by the same owner who understands the very different services each offers and who has no disincentive to refer a patient once their prognosis is appropriate for hospice. The Hospice Integrated Application Integrated Health Services, Inc. (IHS), was founded in the mid-1980’s to establish an alternative to expensive hospital care. Since that time it has grown to offer more than 200 long term care facilities throughout the country including home health agencies, rehabilitative agencies, pharmacy companies, durable medical equipment companies, respiratory therapy companies and skilled nursing facilities. To complete its continuum of care, IHS began to add hospice to offer appropriate care to patients who no longer have the ability to recover. IHS is committed to offering hospice care in all markets where it already has an established long-term care network. IHS entered the hospice arena by acquiring Samaritan Care, an established program in Illinois, in late 1994. Within a few months, IHS acquired an additional hospice program in Michigan. Each of these hospice programs had a census in the thirties at the time of the final hearing. In May of 1996, IHS acquired Hospice of the Great Lakes. Located in Chicago, this hospice program has a census range from 150 to 180. In combination, IHS served approximately 350 hospice patients in 1995. In Service Area 7B, IHS has three long-term care facilities: Central Park Village; IHS of Winter Park; and IHS of Central Park at Orlando. Together, they have 443 skilled nursing beds. One of these—Central Park Village—has established an HIV spectrum program, one of the only comprehensive HIV care programs in Florida. When the state determined that there was a need for an additional hospice program in Service Area 7B, IHS decided to seek to add hospice care to the nursing home and home health companies it already had in the area. Since Florida Statutes require all new hospice programs in Florida to be established by not-for-profit corporations (with Vitas being the only exception), IHS formed Hospice Integrated Health Services of District VII-B (Hospice Integrated), a not- for-profit corporation, to apply for a hospice certificate of need. IHS would be the management company for the hospice program and charge a 4% management fee to Hospice Integrated, although the industry standard is 6%-7%. Although a for-profit corporation, IHS plans for the 4% fee to just cover the costs of the providing management services. IHS believes that the benefits to its health care delivery system in Service Area 7B will justify not making a profit on the hospice operation. However, the management agreement will be reevaluated and possibly adjusted if costs exceed the management fee. In return for this management fee, IHS would offer Hospice Integrated its policy and procedure manuals, its programs for bereavement, volunteer programs, marketing tools, community and educational tools and record keeping. IHS would also provide accounting, billing, and human resource services. Perhaps the most crucial part of the management fee is the offer of the services of Regional Administrator, Marsha Norman. She oversees IHS’ programs in Illinois and Missouri. Ms. Norman took the hospice program at Hospice of the Great Lakes from a census of 40 to 140. This growth occurred in competition with 70 other hospices in the same marketplace. While at Hospice of the North Shore, Ms. Norman improved census from 12 to 65 in only eight months. Ms. Norman helped the Lincolnwood hospice program grow from start up to a census of 150. Ms. Norman has indicated her willingness and availability to serve in Florida if Hospice Integrated’s proposal is approved. IHS and Ms. Norman are experienced in establishing interdisciplinary teams, quality assurance programs, and on-going education necessary to provide state of the art hospice care. Ms. Norman also has experience establishing specialized programs such as drumming therapy, music therapy for Alzheimer patients and children’s bereavement groups. Ms. Norman has worked in pediatric care and understands the special needs of these patients. Ms. Norman’s previous experience also includes Alzheimer’s care research conducted in conjunction with the University of Chicago regarding the proper time to place an Alzheimer patient in hospice care. Through its skilled nursing facilities in Service Area 7B, IHS has an existing working relationship with a core group of physicians who are expected to refer patients to the proposed Hospice Integrated hospice. Although its skilled nursing homes account for only six percent of the total beds in Service Area 7B, marketing and community outreach efforts are planned to expand the existing referral sources if the application is approved. IHS’ hospices are members of the NHO. They are not accredited by the Joint Commission on the Accreditation of Health Care Organizations (JCAHO). Hospice Integrated would serve pediatric patients. However, IHS’ experience in this area is limited to a pilot program to offer pediatric hospice care in the Dallas/Ft. Worth area, and there is little reason to believe that Hospice Integrated would place a great deal of emphasis on this aspect of hospice care. The Hospice Integrated application proposes to provide required grief support but does not include any details for the provision of grief support groups, resocialization groups, grief support volunteers, or community grief support or education activities. In its application, Hospice Integrated has committed to five percent of its care for HIV patients, 40% for non-cancer patients, ten percent for Medicaid patients, and five percent indigent admissions. These commitments also are reflected in Hospice Integrated’s utilization projections. At the same time, it is only fair to note that IHS does not provide any charity care at any of its Service Area 7B nursing home facilities. The Hospice Integrated application includes provision for all four levels of hospice care—home care (the most common), continuous care, respite care and general inpatient. The latter would be provided in one of the IHS skilled nursing home facilities when possible. It would be necessary to contract with an inpatient facility for acute care inpatient services. The federal government requires that five percent of hospice care in a program be offered by volunteers. With a projected year one census of 30, Hospice Integrated would only require 3-4 volunteers to meet federal requirements, and its year one pro forma reflects this level of use of volunteers. However, Hospice Integrated hopes to exceed federally mandated minimum numbers of volunteers. The IHS hospice programs employ volunteers from all aspects of the community, including family of deceased former hospice patients. Contrary to possible implications in the wording of materials included in the Hospice Integrated application, IHS does not approach the latter potential volunteers until after their bereavement has ended. The Wuesthoff Application Wuesthoff Health Services, Inc. (Wuesthoff) is a not- for profit corporation whose sole corporate member is Wuesthoff Health Systems, Inc. (Wuesthoff Systems). Wuesthoff Systems also is the sole corporate member of Wuesthoff’s two sister corporations, Wuesthoff Memorial Hospital, Inc. (Wuesthoff Hospital) and Wuesthoff Health Systems Foundation, Inc. (Wuesthoff Foundation). Wuesthoff Hospital operates a 303-bed acute care hospital in Brevard County. Brevard County comprises AHCA Service Area 7A, and it is adjacent and to the east of Service Area 7B. Wuesthoff Hospital provides a full range of health care services including open heart surgical services, a Level II neonatal intensive care unit and two Medicare-certified home health agencies, one located in Brevard and the other in Indian River County, the county immediate to the south of Brevard. Wuesthoff Foundation serves as the fundraising entity for Wuesthoff Systems and its components. Wuesthoff currently operates a 114-bed skilled nursing facility which includes both long-term and short-term sub-acute beds, as well as a home medical equipment service. Wuesthoff also operates a hospice program, Brevard Hospice, which has served Brevard County residents since 1984. Over the years, it has grown to serve over 500 patients during 1995. Essentially, Wuesthoff’s application reflects an intention to duplicate its Brevard Hospice operation in Service Area 7B. It would utilize the expertise of seven Brevard Hospice personnel currently involved in the day-to-day provision of hospice services, including its Executive Director, Cynthia Harris Panning, to help establish its proposed new hospice in 7B. Wuesthoff has been a member of the NHO since the inception of its hospice program. It also had its Brevard Hospice accredited by JCAHO in 1987, in 1990 and in March, 1996. As a not-for-profit hospice, Wuesthoff has a tradition of engaging in non-compensated hospice services that benefit the Brevard community. Wuesthoff’s In-Touch Program provides uncompensated emotional support through telephone and in-person contacts for patients with a life-threatening illness who, for whatever reason, are not ready for hospice. (Of course, Wuesthoff is prepared to receive compensation for these patients when and if they choose hospice.) Wuesthoff’s Supportive Care program provides uncompensated nursing and psychosocial services by hospice personnel for patients with life-threatening illnesses with life expectancies of between six months and two years. (These services are rendered in conjunction with home health care, which may be compensated, and Wuesthoff is prepared to receive compensation for the provision of hospice services for these patients when they become eligible for and choose hospice.) Wuesthoff’s Companion Aid benefits hospice patients who lack a primary caregiver and are indigent, Medicaid-eligible or unable to pay privately for additional help in the home. If approved in Service Area 7B, Wuesthoff would hope to duplicate these kinds of outreach programs. For the Supportive Care program, that would require its new hospice program to enter into agreements with home health agencies operating in Service Area 7B. While more difficult an undertaking than the current all-Wuesthoff Supportive Care program, Wuesthoff probably will be able to persuade at least some Service Area 7B home health agencies to cooperate, since there would be benefits to them, too. Wuesthoff proposes to use 38 volunteers during its first year in operation. As a not-for-profit organization, Wuesthoff has had good success recruiting, training, using and retaining volunteers in Brevard County. Its experience and status as a not-for-profit organization will help it meet its goals in Service Area 7B; however, it probably will be more difficult to establish a volunteer base in Service Area 7B than in its home county of Brevard. Wuesthoff’s proposed affiliation with Florida Hospital will improve its chances of success in this area. Key to the overall success of Wuesthoff’s proposed hospice is its vision of an affiliation with Florida Hospital. With no existing presence in Service Area 7B, Wuesthoff has no existing relationship with community physicians and no existing inpatient facilities. Wuesthoff plans to fill these voids through a proposed affiliation with Florida Hospital. In existence and growing for decades, Florida Hospital now is a fully integrated health care system with multiple inpatient sites, including more than 1,450 hospital beds, in Service Area 7B. It provides a full range of pre-acute care through post-acute care services, including primary through tertiary services. Approximately 1,200 physicians are affiliated with Florida Hospital, which has a significant physician-hospital organization. Wuesthoff is relying on these physicians to refer patients to its proposed hospice. Florida Hospital and Wuesthoff have signed a letter of intent. The letter of intent only agreed to a forum for discussions; there was no definite agreement concerning admissions, and Florida Hospital has not committed to sending any particular number of hospice patients to Wuesthoff. However, there is no reason to think that Wuesthoff could not achieve a viable affiliation with Florida Hospital. Wuesthoff has recent experience successfully cooperating with other health care providers. It has entered into cooperative arrangements with Jess Parrish Hospital in Brevard County, with Sebastian River Medical Center in Indian River County, and with St. Joseph’s Hospital in Hillsborough County. Wuesthoff’s existing hospice provides support to children who are patients of its hospice, whose parents are in hospice or whose relatives are in hospice, as well as to other children in the community who are in need of bereavement support services. Wuesthoff employs a full-time experienced children’s specialist. Wuesthoff also provides crisis response services for Brevard County Schools System when there is a death at a school or if a student dies or if there is a death that affects the school community. Camp Hope is a bereavement camp for children which is operated by Wuesthoff annually for approximately 50 Brevard children who have been affected by death. Wuesthoff operates extensive grief support programs as part of its Brevard Hospice. At a minimum, Wuesthoff provides 13 months of grief support services following the death of a patient, and more as needed. It employs an experienced, full- time grief support coordinator to oversee two grief support specialists (each having Masters degree level training), as well as 40 grief support volunteers, who function in Wuesthoff’s many grief support groups. These include: Safe Place, an open grief support group which meets four times a month and usually is the first group attended by a grieving person; Pathways, a closed six-week grief workshop offered twice a year primarily for grieving persons three to four months following a death; Bridges, a group for widows under age 50, which is like Pathways but also includes sessions on helping grieving children and on resocialization; Just Us Guys and Gals, which concentrates on resocialization and is attended by 40 to 80 people a month; Family Night Out, an informal social opportunity for families with children aged six to twelve; Growing Through Grief, a closed six-week children’s grief group offered to the Brevard County School System. Wuesthoff also publishes a newsletter for families of deceased hospice patients for a minimum of 13 months following the death. Wuesthoff also participates in extensive speaking engagements and provides seminars on grief issues featuring nationally renowned speakers. Wuesthoff intends to use the expertise developed in its Brevard Hospice grief support program to establish a similar program in Service Area 7B. The Brevard Hospice coordinator will assist in implementing the Service Area 7B programs. In its utilization projections, Wuesthoff committed to seven percent of hospice patient days provided to indigent/charity patients and seven percent to Medicaid patients. Wuesthoff also committed to provide hospice services to AIDS patients, pediatric patients, patients in long-term care facilities and patients without a primary caregiver; however, no specific percentage committments were made. In its pro formas, Wuesthoff projects four percent hospice services to HIV/AIDS patients and approximately 40% to non-cancer patients. The narrative portions of its application, together with the testimony of its chief executive officer, confirm Wuesthoff’s willingness to condition its CON on those percentages. In recent years, the provision of Medicaid at Brevard Hospice has declined. However, during the same years, charity care provided by Brevard Hospice has increased. In the hospice arena, Medicaid hospice is essentially fully reimbursed. Likewise, the provision of hospice services to AIDS/HIV patients by Brevard Hospice has declined in recent years—from 4.9% in 1993 to 1.4% in 1995. However, this decline was influenced by the migration of many AIDS patients to another county, where a significant number of infectious disease physicians are located, and by the opening of Kashy Ranch, another not-for-profit organization that provides housing and services especially for HIV clients. Financial Feasibility Both applications are financially feasible in the immediate and long term. Immediate Financial Feasibility Free-standing hospice proposals like those of Hospice Integrated and Wuesthoff, which intend to contract for needed inpatient care, require relatively small amounts of capital, and both applications are financially feasible in the immediate term. Hospice Integrated is backed by a $100,000 donation and a commitment from IHS to donate the additional $300,000 needed to open the new hospice. IHS has hundreds of millions of dollars in lines of credit available meet this commitment. Wuesthoff questioned the short-term financial feasibility of the Hospice Integrated proposal in light of recent acquisitions of troubled organizations by IHS. It recently acquired an organization known as Coram at a cost of $655 million. Coram recently incurred heavy losses and was involved in litigation in which $1.5 billion was sought. IHS also recently acquired a home health care organization known as First American, whose founder is currently in prison for the conduct of affairs at First American. But none of these factors seriously jeopardize the short-term financial feasibility of the Hospice Integrated proposal. Wuesthoff also noted that the IHS commitment letter is conditioned on several “approvals” and that there is no written commitment from IHS to enter into a management contract with Hospice Integrated at a four percent fee. But these omissions do not seriously undermine the short-term financial feasibility of the Hospice Integrated proposal. Hospice Integrated, for its part, and AHCA question the short-term financial feasibility of the Wuesthoff proposal, essentially because the application does not include a commitment letter from with Wuesthoff Systems or Wuesthoff Hospital to fund the project costs. The omission of a commitment letter is comparable to the similar omissions from the Hospice Integrated application. It does not undermine the short-term financial feasibility of the proposal. Notwithstanding the absence of a commitment letter, the evidence is clear that the financial strength of Wuesthoff Systems and Wuesthoff Hospital support Wuesthoff’s hospice proposal. This financial strength includes the $38 to $40 million in cash and marketable securities reflected in the September 30, 1995, financial statements of Wuesthoff Systems, in addition to the resources of Wuesthoff Hospital. Hospice Integrated also questions the ability of Wuesthoff Systems to fund the hospice proposal in addition to other planned capital projects. The Wuesthoff application indicates an intention to fund $1.6 million of the needed capital from operations and states that $1.4 million of needed capital in “assured but not in hand.” But some of the projects listed have not and will not go forward. In addition, it is clear from the evidence that Wuesthoff Systems and Wuesthoff Hospital have enough cash on hand to fund all of the capital projects that will go forward, including the $290,000 needed to start up its hospice proposal. Long-Term Financial Feasibility Wuesthoff’s utilization projections are more aggressive than Hospice Integrated’s. Wuesthoff projects 186 admissions in year one and 380 in year two; Hospice Integrated projects 124 admissions in year one and 250 in year two. But both projections are reasonably achievable. Projected patient days, revenue and expenses also are reasonable for both proposals. Both applicants project an excess of revenues over expenses in year two of operation. Vitas criticized Hospice Integrated’s nursing salary expenses, durable medical equipment, continuous and inpatient care expenses, and other patient care expenses as being too low. But Vitas’ criticism was based on misapprehension of the facts. The testimony of Vitas’ expert that nursing salaries were too low was based on the misapprehension that Hospice Integrated’s nursing staffing reflected in the expenses for year two of operation was intended to care for the patient census projected at year end. Instead, it actually reflected the expenses of average staffing for the average patient census for the second year of operation. Vitas’ expert contended that Hospice Integrated’s projected expenses for durable medical equipment for year two of operation were understated by $27,975. But there is approximately enough overallocated in the line items “medical supplies” and “pharmacy” to cover the needs for durable medical equipment. Vitas’ expert contended that Hospice Integrated’s projected expenses for continuous and inpatient care were understated by $23,298. This criticism made the erroneous assumption that Hospice Integrated derived these expenses by taking 75% of its projected gross revenues from continuous and inpatient care. In fact, Hospice Integrated appropriately used 75% of projected collections (after deducting contractual allowances). In addition, as far as inpatient care is concerned, Hospice Integrated has contracts with the IHS nursing homes in Service Area 7B to provide inpatient care for Hospice Integrated’s patients at a cost below that reflected in Hospice Integrated’s Schedule 8A. Vitas’ expert contended that Hospice Integrated’s projected expenses for “other patient care” were understated by $19,250. This criticism assumed that fully half of Hospice Integrated’s patients would reside in nursing homes that would have to be paid room and board by the hospice out of federal reimbursement “passed through” the hospice program. However, most hospices have far fewer than half of their patients residing in nursing homes (only 17% of Comforter’s are nursing home residents), and Hospice Integrated made no such assumption in preparing its Schedule 8A projections. In addition, Hospice Integrated’s projections assumed that five percent of applicants for Medicaid pass-through reimbursement would be rejected and that two percent of total revenue would be lost to bad debt write-offs. Notwithstanding Vitas’ attempts to criticize individual line items of Hospice Integrated’s Schedule 8A projections, Hospice Integrated’s total average costs per patient day were approximately the same as Wuesthoff’s--$19 per patient day. Vitas did not criticize Wuesthoff’s projections. On the revenue side, Hospice Integrated’s projections were conservative in several respects. Projected patients days (6,800 in year one, and 16,368 in year two) were well within service volumes already achieved in hospices IHS recently has started in other states (which themselves exceeded their projections). Medicaid and Medicare reimbursement rates used in Hospice Integrated’s projections were low. Hospice Integrated projects that 85% of its patients will be Medicare patients and that ten percent will be Medicaid. Using more realistic and reasonable reimbursement for these patients would add up to an additional $74,000 to projected excess of revenue over expenses in year two. Wuesthoff also raised its own additional questions regarding the long-term financial feasibility of the Hospice Integrated proposal. Mostly, Wuesthoff questioned the inexperience of the Hospice Integrated entity, as well as IHS’ short track record. It is true that the hospices started by IHS were in operation for only 12-14 months at the time of the final hearing and that, on a consolidated basis, IHS’ hospices lost money in 1995. But financial problems in one hospice inherited when IHS acquired it skewed the aggregate performance of the hospices in 1995. Two of them did have revenues in excess of expenses for the year. In addition, Hospice of the Great Lakes, which was not acquired until 1996, also is making money. On the whole, IHS’ experience in the hospice arena does not undermine the financial feasibility of the Hospice Integrated application. Wuesthoff also questioned Hospice Integrated’s assumption that the average length of stay (ALOS) of its hospice patients will increase from 55 to 65 days from year one to year two of operation. Wuesthoff contended that this assumption is counter to the recent trend of decreasing ALOS’s, and that assuming a flat ALOS would decrease projected revenues by $262,000. But increasing ALOS from year one to year two is consistent with IHS’ recent experience starting up new hospices. In part, it is reasonably explained by the way in which patient census “ramps up” in the start up phase of a new hospice. As a program starts up, often more than average numbers of patients are admitted near the end of the disease process and die before the ALOS; also, as patient census continues to ramp up, often more than average numbers of patients who still are in the program at the end of year one will have been admitted close to the end of the year and will have been in the program for less than the ALOS. Finally, while pointing to possible revenue shortfalls of $262,000, Wuesthoff overlooked the corresponding expense reductions that would result from lower average daily patient census. It is found that both proposals also are financially feasible in the long term. State and Local Plan Preferences Local Health Plan Preference Number One Preference shall be given to applicants which provide a comprehensive assessment of the impact of their proposed new service on existing hospice providers in the proposed service areas. Such assessment shall include but not be limited to: A projection of the number of Medicare/Medicaid patients to be drawn away from existing hospice providers versus the projected number of new patients in the service area. A projection of area hospice costs increases/decreases to occur due to the addition of another hospice provider. A projection of the ratio of administrative expenses to patient care expenses. Identification of sources, private donations, and fund-raising activities and their affect on current providers. Projection of the number of volunteers to be drawn away from the available pool for existing hospice providers. Both applicants provided an assessment of the impact of their proposed new service on existing hospice providers in the proposed service areas (although both applicants could have provided an assessment that better met the intent of the Local Health Plan Preference One.) There was no testimony that, and it is not clear from the evidence that, one assessment is markedly superior to the other. There also was no evidence as to how the assessments are supposed to be used to compare competing applicants. Both applicants essentially stated that they would not have an adverse impact on the existing providers. The basis for this assessment was that there is enough underserved need in Service Area 7B to support an additional hospice with no adverse impact on the existing providers. Vitas disputed the applicants’ assessment. Vitas presented evidence that it and Comforter have been unable, despite diligent marketing efforts, to achieve statewide average hospice use rates in Service Area 7B, especially for non-cancer and under 65 hospice eligible patients, that the existing hospices can meet the needs of the hospice-eligible patients who are choosing hospice, and that other health care alternatives are available to meet the needs of hospice-eligible patients who are not choosing hospice. Vitas also contended that the applicants will not be able to improve much on the marketing and community outreach efforts of the existing providers. In so doing, Vitas glossed over considerable evidence in the record that the addition of a hospice program, by its mere presence, will increase awareness of the hospice option in 7B regardless whether the new entrant improves upon the marketing efforts of the existing providers, and that increased awareness will result in higher conversion rates. Vitas’ counter-assessment also made several other invalid assumptions. First, it is clear from the application of the FNP rule that, regardless of the conversion rate in Service Area 7B, the size of the pool of potential hospice patients clearly is increasing. Second, it is clear that the FNP rule is inherently conservative, at least in some respects. See Finding 24, supra. The Vitas assessment also made the assumption that the existing providers are entitled to their current market share (87% for Vitas and 13% for Comforter) of anticipated increases in hospice use in Service Area 7B and that the impact of a new provider should be measured against this entitlement. But to the extent that anticipated increased hospice use in Service Area 7B accommodates the new entrant, there will be no impact on the current finances or operations of Vitas and Comforter. Finally, in attempting to quantify the alleged financial impact of an additional hospice program, Vitas failed to reduce variable expenses in proportion to the projected reduction in patient census. Since most hospice expenses are variable, this was an error that greatly increased the perceived financial impact on the existing providers. While approval of either hospice program probably will not cause an existing provider to suffer a significant adverse impact, it seems clear that the impact of Wuesthoff’s proposal would be greater than that of Hospice Integrated. Wuesthoff seeks essentially to duplicate its Brevard Hospice operation in Service Area 7B. Wuesthoff projects higher utilization (186 admissions in year one and 380 admissions in year two, as compared to the 124 and 250 projected by Hospice Integrated). In addition, Wuesthoff’s primary referral source for hospice patients—Florida Hospital—also is the primary referral source of Vitas, which gets 38% of its referrals from Florida Hospital. In contrast, while also marketing in competition with the existing providers, Hospice Integrated will rely primarily on the physicians in Orange and Osceola Counties with whom IHS already has working relationships through its home health agencies and skilled nursing facilities. Hospice Integrated’s conservative utilization projections (124 admissions in year one and 250 in year two) will not nearly approach the service gap identified by the rule (407 admissions). In total, Hospice Integrated only projected obtaining 6% of the total market share in year one and 12% in year two, leaving considerable room for continued growth of the existing providers in the district. The hospice industry has estimated that 10% of patients in long-term care facilities are appropriate for hospice care. IHS regularly uses an estimate of five percent. Common ownership of skilled nursing facilities and hospice programs allows better identification of persons with proper prognosis for hospice. These patients would not be drawn away from existing hospice providers. In addition to the difference in overall utilization projections between the applicants, there also is a difference in focus as to the kinds of patients targeted by the two applicants. The Hospice Integrated proposal focuses more on and made a greater commitment to non-cancer admissions. In addition, IHS has a good record of increasing hospice use by non-cancer patients. In contrast, Wuesthoff’s proposal focuses more on cancer admissions (projecting service to more cancer patients than represented by the underserved need for hospice for those patients, according to the FNP rule) and did not commit to a percentage of non-cancer use in its application. For these reasons, Wuesthoff’s proposal would be expected to have a greater impact and be more detrimental to existing providers than Hospice Integrated. Hospice Integrated also is uniquely positioned to increase hospice use by AIDS/HIV patients in Service Area 7B due to its HIV spectrum program at Central Park Village. It focused more on and made a greater commitment to this service in its application that Wuesthoff did it its application. To the extent that Hospice Integrated does a better job of increasing hospice use by AIDS/HIV patients, it is more likely to draw patients from currently underutilized segments of the pool of hospice-eligible patients in Service Area 7B and have less impact on existing providers than Wuesthoff. Vitas makes a better case that its pediatric hospice program will be impacted by the applicants, especially Wuesthoff. Vitas’ census of pediatric hospice patients ranges between seven and 14. A reduction in Vitas’ already small number of pediatric hospice patients could reduce the effectiveness of its pediatric team and impair its viability. Wuesthoff proposes to duplicate the Brevard Hospice pediatric program, creating a pediatric program with a specialized pediatric team and extensive pediatric programs, similar to Vitas’ program. On the other hand, Hospice Integrated proposes a pediatric program but not a specialized team, and it would not be expected to compete as vigorously as Wuesthoff for pediatric hospice patients. The evidence was not clear as to whether area hospice costs would increase or decrease as a result of the addition of either applicant in Service Area 7B. Vitas, in its case-in- chief, provided an analysis of projected impacts from the addition of either hospice provider. As already indicated, Vitas’ analysis incorporated certain invalid assumptions regarding the fixed/variable nature of hospice costs. However, Vitas’ analysis supported the view that Wuesthoff’s impact would be greater. Wuesthoff’s ratio of administrative expenses to patient care expenses (24% to 76% in year one, dropping to 22% to 78% in year two) is lower than Hospice Integrated’s (26% to 71%). Wuesthoff also appears more likely to compete more directly and more vigorously with the existing providers than Hospice Integrated for private donations, in fund-raising activities, and for volunteers. Local Health Plan Preference Number Two Preference shall be given to an applicant who will serve an area where hospice care is not available or where patients must wait more than 48 hours for admission, following physician approval, for a hospice program. Documentation shall include the number of patients who have been identified by providers of medical care and the reasons resulting in their delay of obtaining hospice care. There was no direct evidence of patients who were referred for hospice services but failed to receive them. Local Health Plan Preference Number Three Preference shall be given to an applicant who will serve in addition to the normal hospice population, an additional population not currently serviced by an existing hospice (i.e., pediatrics, AIDS patients, minorities, nursing home residents, and persons without primary caregivers.) State Health Plan Factor Four Preference shall be given to applicants which propose to serve specific populations with unmet needs, such as children. State Health Plan Preference Number Five Preference shall be given to an applicant who proposes a residential component to serve patients with no at- home support. When Medicare first recognized hospice care in 1983, more than 90% of hospice cases were oncology patients. Although use of hospice by non-cancer patients has increased to 40% statewide, it lags behind in Service Area 7B, at only 27%. Both applicants will serve non-cancer patients. But Hospice Integrated has made a formal commitment to 40% non-cancer patient days and has placed greater emphasis on expanding the provision of hospice services for non-cancer patients. The clinical background of employees of IHS and Hospice Integrated can effectively employ NHO guidelines to identify the needs of AIDS patients and other populations. In its other hospice programs, IHS has succeeded in achieving percentages of non-cancer hospice use of 60% and higher. Wuesthoff projects over 40% non-cancer patient days, and is willing to accept a CON condition of 40% non-cancer patient days, but it did not commit to a percentage in its application. In Service Area 7B, there are 1,200 people living with AIDS and 10,000 who are HIV positive. Both applicants would serve AIDS/HIV patients, but Hospice Integrated has demonstrated a greater commitment to this service. Not only does IHS have its HIV spectrum program at Central Park Village, it also has committed to five percent of its care for HIV patients. Wuesthoff has agreed to serve AIDS/HIV patients, projects that about four percent of its patient days will be provided to AIDS/HIV patients, and would be willing to condition its CON on the provision of four percent of its care to AIDS/HIV patients. But Wuesthoff did not commit to a percentage in its application. Both applicants will serve children, but Wuesthoff has demonstrated greater commitment and ability to provide these services. Ironically, Wuesthoff’s advantage in the area of pediatric hospice carries with it the disadvantage of causing a greater impact on Vitas than Hospice Integrated’s proposal. See Findings 101-102, supra. While neither applicant specifically addressed the provision of services to minorities, both made commitments to provide services for Medicaid patients and the indigent. Hospice Integrated’s commitment to Medicaid patients is higher (ten percent as compared to seven percent for Wuesthoff). But the commitment to Medicaid patients is less significant in the hospice arena because Medicaid essentially fully reimburses hospice care. Meanwhile, Wuesthoff committed seven percent to indigent/charity patients, as compared a five percent commitment to the indigent for Hospice Integrated. But there was some question as to whether Wuesthoff was including bad debt in the seven percent. Both applicants will provide care for patients without primary caregivers. Earlier in its short history of providing hospice, IHS required patients to have a primary caregiver. However, that policy has been changed, and IHS now accepts such patients. Wuesthoff has long provided care for patients without primary caregivers. Local Health Plan Preference Number Four Preference shall be given to an applicant who will commit to contracting for existing inpatient acute care beds rather than build a free-standing facility. State Health Plan Preference Number Six Preference shall be given to applicants proposing additional hospice beds in existing facilities rather than the construction of freestanding facilities. Neither applicant plans to build a free-standing facility for the provision of inpatient care. Both plan to contract for needed inpatient acute care beds, to the extent necessary. IHS’ common ownership of existing skilled nursing facilities in Service Area 7B allows Hospice Integrated access to subacute care at any time. However, not all physicians will be willing to admit all hospice patients to skilled nursing facilities for inpatient care, and Hospice Integrated also will have to contract with acute care facilities to cover those instances. Wuesthoff relies on its proposed affiliation with Florida Hospital for needed inpatient care for its proposed Service Area 7B hospice. State Health Plan Preference Number Two Preference shall be given to an applicant who provides assurances in its application that it will adhere to the standards and become a member of the National Hospice Organization or will seek accreditation by the JCAHO. Both applicants meet this preference. Wuesthoff’s Brevard Hospice has JCAHO as well as membership in the National Hospice Organization (NHO). IHS’s hospices are NHO members, and Hospice Integrated’s application states that it will become a member of the NHO. Wuesthoff’s JCAHO accreditation does not give it an advantage under this preference. Other Points of Comparison In addition to the facts directly pertinent to the State and Local Health Plan Preference, other points of comparison are worthy of consideration. General Hospice Experience Wuesthoff went to great lengths to make the case that its experience in the hospice field is superior to that of Hospice Integrated and IHS. Wuesthoff criticized the experience of its opponent as being short in length and allegedly long on failures. It is true that IHS was new to the field of hospice when it acquired its first hospice in December, 1994, and that it has had to deal with difficulties in venturing into a new field and starting up new programs. Immediately after IHS acquired Samaritan Care of Illinois, Martha Nickel assumed the role of Vice-President of Hospice Services for IHS. After several weeks in charge of the new acquisition, and pending the closing of the purchase of Samaritan Care of Michigan from the same owner set for later in 1995, Nickel uncovered billing improprieties not discovered during IHS’ due diligence investigations. As a result, IHS was required to reimburse the Health Care Financing Administration (HCFA) approximately $3.5 million, and the purchase price for Samaritan Care of Michigan was adjusted. After this rocky start, IHS’ hospice operation settled down. Hospice Integrated’s teams have completed five to seven start up operations and understand what it takes to enter a new market, increase community awareness, and achieve hospice market penetration. Personnel who would implement Hospice Integrated’s approved hospice program have significant experience establishing new hospice programs, having them licensed and receiving accreditation. Without question, IHS’ Marsha Norman has the ability to start up a new hospice program. In contrast, Wuesthoff has operated its hospice in Brevard County since 1984. It is true that Wuesthoff’s Brevard Hospice appears to have been highly successful and, compared to the IHS experience, relatively stable in recent years. But, at the same time, Wuesthoff personnel have not had recent experience starting up a new hospice operation in a new market. Policies and Procedures A related point of comparison is the status of the policies and procedures to be followed by the proposed hospices. Wuesthoff essentially proposes to duplicate its Brevard Hospice in Service Area 7B and simply proposes to use the same policies and procedures. In contrast, IHS still is developing its policies and procedures and is adapting them to new regulatory and market settings as it enters new markets. As a result, the policies and procedures included in the Hospice Integrated application serve as guidelines for the new hospice and more of them are subject to modification than Wuesthoff’s. Regulatory Compliance A related point of comparison is compliance with regulations. Wuesthoff contends that it will be better able to comply with Florida’s hospice regulations since it already operates a hospice in Florida. In some respects, IHS’ staffing projections were slightly out of compliance with NHO staffing guidelines. However, Ms. Norman persuasively gave her assurance that Hospice Integrated would be operated so as to meet all NHO guidelines. One of IHS’ hospice programs was found to have deficiencies in a recent Medicare certification survey, but those deficiencies were “paper documentation” problems that were quickly remedied, and the program timely received Medicare certification. In several respects, the policies and procedures included in Hospice Integrated’s application are out of compliance with Florida regulations and will have to be changed. For example, the provision in Hospice Integrated’s policies and procedures for coordination of patient/family care by a social worker will have to be changed since Florida requires a registered nurse to fill this role. Similarly, allowance in the policies and procedures for hiring a lay person in the job of pastoral care professional (said to be there to accommodate the use of shamans or medicine men for Native American patients) is counter to Florida’s requirement that the pastoral care professional hold a bachelor’s degree in pastoral care, counseling or psychology. Likewise, the job description of social worker in the policies and procedures falls below Florida’s standards by requiring only a bachelor’s degree (whereas Florida requires a master’s degree). Although IHS does not yet operate a hospice in Florida, it has three long-term care facilities and two home health agencies in Service Area 7B, as well as 25 other skilled nursing facilities and several other new home health care acquisitions in Florida. Nationwide, IHS has nursing homes in 41 different states, home health care in 31 different states, and approximately 120 different rehabilitation service sites. Through its experiences facing the difficulties of entering the hospice field through acquisitions, IHS well knows federal regulatory requirements and is quite capable of complying with them. IHS also has had experience with the hospice regulations of several other states. There is no reason to think that Hospice Integrated will not comply with all federal and state requirements. Wuesthoff now knows how to operate a hospice in compliance with federal and state regulatory requirements. But, while Wuesthoff’s intent was to simply duplicate its Brevard Hospice in Service Area 7B, that intention leads to the problem that its board of directors does not have the requisite number of residents of Service Area 7B. Measures will have to be taken to insure appropriate composition of its board of directors. 140. On balance, these items of non-compliance are relatively minor and relatively easily cured. There is no reason to think that either applicant will refuse or be unable to comply with regulatory requirements. Not-for-Profit Experience Wuesthoff clearly has more experience as a not-for- profit entity. This includes extensive experience in fund- raising and in activities which benefit the community. It also gives Wuesthoff an edge in the ability to recruit volunteers. See Findings 56-58, supra. Ironically, Wuesthoff’s advantages over Hospice Integrated in these areas probably would increase its impact on the existing providers. See Finding 105, supra. Presence and Linkages in Service Area 7B Presently, Wuesthoff has no presence in Service Area 7B. As one relatively minor but telling indication of this, Wuesthoff’s lack of familiarity with local salary levels caused it to underestimate its Schedule 8A projected salaries for its administrator, patient coordinator, nursing aides and office manager. IHS has an established presence in Service Area 7B. This gives Hospice Integrated an advantage over Wuesthoff. For example, its projected salary levels were accurate. Besides learning from experience, Wuesthoff proposes to counter Hospice Integrated’s advantage through its proposed affiliation with Florida Hospital. While IHS’ presence and linkages in Service Area 7B is not insignificant, it pales in comparison to Florida Hospital’s. To the extent that Wuesthoff can developed the proposed affiliation, Wuesthoff would be able to overcome its disadvantage in this area. Wuesthoff also enjoys a linkage with the Service Area 7B market through its affiliate membership in the Central Florida Health Care Coalition (CFHCC). The CFHCC includes large and small businesses, as well as Central Florida health care providers. Its goal is to promote the provision of quality health care services. Quality Hospice Services Both applicants deliver quality hospice services through their existing hospices and can be expected to do so in their proposed hospices. As an established and larger hospice than most of IHS’ hospices, Brevard Hospice can provide more enhanced services than most of IHS’. On the other hand, IHS has been impressive in its abilty to expand services to non-cancer patients, and it also is in a better position to provide services to AIDS/HIV patients, whereas Wuesthoff is better able to provide quality pediatric services. Wuesthoff attempted to distinguish itself in quality of services through its JCAHO accreditation. Although Hospice Integrated’s application states that it will get JCAHO accreditation, it actually does not intend to seek JCAHO accreditation until problems with the program are overcome and cured. Not a great deal of significance can be attached to JCAHO hospice accreditation. The JCAHO hospice accreditation program was suspended from 1990 until 1996 due to problems with the program. Standards were vague, and it was not clear that they complied with NHO requirements. Most hospices consider NHO membership to be more significant. None of IHS’s new hospices are even eligible for JCAHO accreditation because they have not been in existence long enough. Bereavement Programs Wuesthoff’s bereavement programs appear to be superior to IHS’. Cf. Findings 44, and 63-64, supra. To some extent, Wuesthoff’s apparent superiority in this area (as in some others) may be a function of the size of Brevard Hospice and the 14-year length of its existence. The provisions in the policies and procedures included in the Hospice Integrated application relating to bereavement are cursory and sparse. IHS relies on individual programs to develop their own bereavement policies and procedures. The provisions in the policies and procedures included in the Hospice Integrated application relating to bereavement include a statement that a visit with the patient’s family would be conducted “if desired by the family and as indicated by the needs of the family.” In fact, as Hospice Integrated concedes, such a visit should occur unless the family expresses a desire not to have one. Continuum of Care One of IHS’ purposes in forming Hospice Integrated to apply for a hospice CON is to improve the continuum of care it provides in Service Area 7B. The goal of providing a continuum of care is to enable case managers to learn a patient’s needs and refer them to the appropriate care and services as the patient’s needs change. While IHS already has an integrated delivery system in Service Area 7B, it lacks hospice. Adding hospice will promote the IHS continuum of care. Since it lacks any existing presence in Service Area 7B, granting the Wuesthoff application will not improve on an existing delivery system in the service area. I. Continuous and Respite Care Though small components of the total hospice program, continuous or respite hospice care should be offered by every quality provider of hospice and will be available in IHS’ program. Wuesthoff’s application failed to provide for continuous or respite hospice care. However, Wuesthoff clearly is capable of remedying this omission. Result of Comparison Both applicants have made worthy proposals for hospice in Service Area 7B. Each has advantages over the other. Balancing all of the statutory and rule criteria, and considering the State and Local Health Plan preferences, as well as the other pertinent points of comparison, it is found that the Hospice Integrated application is superior in this case. Primary advantages of the Hospice Integrated proposal include: IHS’ presence in Service Area 7B, especially its HIV spectrum program at Central Park Village; its recent experience and success in starting up new hospice programs; its success in expanding hospice to non-cancer patients elsewhere; Hospice Integrated’s greater commitment to extend services to the underserved non- cancer and AIDS/HIV segments of the hospice-eligible population; and IHS’ ability to complete its continuum of care in Service Area 7B through the addition of hospice. These and other advantages are enough to overcome Wuesthoff’s strengths. Ironically, some of Wuesthoff’s strengths, including its strong pediatric program and its ability (in part by virtue of its not- for-profit status) and intention generally to compete more vigorously with the existing providers on all fronts, do not serve it so well in this case, as they lead to greater impacts on the existing providers.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the AHCA enter a final order approving CON application number 8406 so that Hospice Integrated may establish a hospice program in the AHCA Service Service Area 7B but denying CON application number 8407 filed by Wuesthoff. RECOMMENDED this 6th day of May, 1997, at Tallahassee, Florida. J. LAWRENCE JOHNSTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 SUNCOM 278-9675 Fax FILING (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 6th day of May, 1997. COPIES FURNISHED: J. Robert Griffin, Esquire 2559 Shiloh Way Tallahassee, Florida 32308 Thomas F. Panza, Esquire Seann M. Frazier, Esquire Panza, Maurer, Maynard & Neel, P.A. NationsBank Building, Third Floor 3600 North Federal Highway Fort Lauderdale, Florida 33308 David C. Ashburn, Esquire Gunster, Yoakley, Valdes-Fauli & Stewart, P.A. 215 South Monroe Street, Suite 830 Tallahassee, Florida 32301 Richard Patterson Senior Attorney Agency for Health Care Administration Fort Knox Building 3, Suite 3431 2727 Mahan Drive Tallahassee, Florida 32308-5403 Sam Power, Agency Clerk Agency for Health Care Administration Fort Knox Building 3, Suite 3431 2727 Mahan Drive Tallahassee, Florida 32308-5403 Jerome W. Hoffman General Counsel Agency for Health Care Administration 2727 Mahan Drive Tallahassee, Florida 32308-5403
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.
