07-003404RP Select Specialty Hospital-Orlando, Inc. vs. Agency For Health Care Administration
 Status: Closed
DOAH Final Order on Tuesday, September 23, 2008.


View Dockets  
Summary: Petitioners proved that the proposed rule to include long-term care hospitals within the definition of tertiary health service is an invalid exercise of delegated legislative authority.

1STATE OF FLORIDA

4DIVISION OF ADMINISTRATIVE HEARINGS

8PROMISE HEALTHCARE, INC., )

12)

13Petitioner, )

15)

16and )

18)

19SELECT SPECIALTY HOSPITAL- )

23ORLANDO, INC., )

26)

27Intervenor, )

29)

30vs. ) Case No. 07-3403RP

35)

36AGENCY FOR HEALTH CARE ADMINISTRATION, )

42)

43)

44Respondent. )

46)

47SELECT SPECIALTY HOSPITAL- )

51ORLANDO, INC., )

54)

55Petitioner, )

57)

58vs. ) Case No. 07-3404RP

63)

64AGENCY FOR HEALTH CARE ADMINISTRATION, )

70)

71)

72Respondent. )

74)

75SUMMARY FINAL ORDER

78This case involves a challenge to a proposed rule and is

89resolved based upon consideration of motions for summary final

98order filed on behalf of Petitioners, Promise Healthcare, Inc.

107(Promise) and Select Specialty Hospital-Orlando, Inc. (Select)

114and the Agency for Health Care Administration (Agency or AHCA).

124Petitioners contend that proposed rule 59C-1.002(41)(i)

130(proposed rule) is an invalid exercise of delegated legislative

139authority because the proposed rule enlarges and contravenes the

148specific provisions of the law implemented and the services

157provided by long-term care hospitals (LTCHs) are not the types

167of services which can be reasonably considered to be tertiary

177health services as defined in Section 408.032(17), Florida

185Statutes. The Agency contends that long-term care hospital

193services provided within long-term care hospitals are tertiary

201health services and, as a result, the proposed rule is valid.

212The parties agree there are no genuine issues as to any

223material fact for resolution and that entry of a summary final

234order is appropriate. See § 120.57(1)(h), Fla. Stat.

242APPEARANCES

243For Petitioner Promise Healthcare, Inc.:

248F. Philip Blank, Esquire

252Blank & Meenan, P.A.

256204 South Monroe Street

260Tallahassee, Florida 32301

263For Petitioner/Intervenor Select Specialty Hospital-

268Orlando, Inc.:

270Mark A. Emanuele, Esquire

274Panza, Maurer & Maynard, P.A.

279Bank of America Building, Third Floor

2853600 North Federal Highway

289Fort Lauderdale, Florida 33308

293For Respondent Agency for Health Care Administration:

300Bart O. Moore, Esquire

304Shaddrick A. Haston, Esquire

308Agency for Health Care Administration

313Fort Knox Building III, Mail Stop 3

3202727 Mahan Drive, Suite 3431

325Tallahassee, Florida 32308

328PRELIMINARY STATEMENT

330The proposed rule was published in the June 8, 2007,

340edition of the Florida Administrative Weekly in Volume 33,

349Number 23. The proposed rule is numbered 59C-1.002(41)(i) and

358includes "Long-term care hospitals" within the definition of

"366tertiary health service."

369On July 23, 2007, Promise filed a Petition to Determine

379Invalidity of Proposed Rule. On July 24, 2007, Select filed a

390Petition to Determine Invalidity of Proposed Rule.

397On August 23, 2007, Select filed a Petition to Intervene in

408Case No. 07-3403RP, which was granted.

414After an unopposed continuance was granted, the final

422hearing was scheduled for January 9-10, 2008, and then re-

432scheduled without objection for January 10-11, 2008.

439Thereafter, the matter was placed in abeyance by agreement of

449the parties until the parties advised that the matter should be

460re-scheduled for final hearing. The final hearing was re-

469scheduled to commence on November 5, 2008.

476During a pre-hearing conference held on June 3, 2008, the

486parties suggested that the proposed rule should be read to mean

497long-term care hospital services within long-term care hospitals

505for the purpose of determining whether the proposed rule is

515invalid. The parties advised that they would be offering

524evidence during the final hearing on the issue of whether long-

535term care hospital services within long-term care hospitals are

544a tertiary health service.

548By Order dated July 11, 2008, the parties were requested to

559respond in writing to the following issues: "In this proceeding

569involving a facial challenge to the proposed rule, are the

579parties and the undersigned restricted to consideration of the

588written language in the proposed rule or, as suggested, not so

599restricted? Is an evidentiary hearing required if consideration

607is limited to the proposed rule? If an evidentiary hearing is

618not required, can the issues raised in the petitions be

628determined on cross-motions for summary final order pursuant to

637Section 120.57(1)(h), Florida Statutes, see generally Board of

645Trustees of the Internal Improvement Trust Fund v. Day Cruise

655Association, Inc. , 794 So. 2d 696 (Fla. 1st DCA 2001)?"

665On July 28, 2008, the Agency responded, advising in part,

675that an evidentiary hearing was not required given the

684Petitioners facial challenge to the proposed rule. The Agency

693requested leave to file a motion for summary final order.

703On July 28, 2008, Petitioners filed a response to the

713July 11, 2008, Order; a Motion for Summary Final Order, with

724attachments; and a Notice of Filing, with a copy of the

735deposition of Jeffrey N. Gregg taken December 18, 2007, and an

746affidavit of Michael J. Kornblatt dated July 18, 2008.

755Petitioners also requested that judicial notice (official

762recognition) be taken of Chapter 2004-383, Laws of Florida, and

772a House of Representatives Staff Analysis, February 17, 2004.

781On August 27, 1008, the parties filed a document entitled

791Joint Stipulated Facts setting forth stipulated undisputed

798facts. On September 2, 2008, the parties filed an Amended Joint

809Stipulation of Facts (AJSF), which included the party's

817positions. The stipulated facts have been incorporated in the

826Findings of Fact.

829On September 5, 2008, the Agency filed a Motion for Summary

840Final Order, which included an affidavit of Jeffrey N. Gregg,

850the Bureau Chief of the Health Facility Regulation Bureau,

859Health Quality Assurance Division, of AHCA. Several exhibits

867are attached to the affidavit, which "summarize the research,

876the rationale, and the reasoning used by the Agency in

886promulgating" the proposed rule.

890On September 12, 2008, the Agency filed a response to

900Petitioners' Motion for Summary Final Order and on September 18,

9102008, Petitioners filed a response to the Agency's Motion for

920Summary Final Order.

923Official recognition is taken of the two documents attached

932to Petitioners' motion. See §§ 120.569(2)(i) and 120.57(1)(f),

940Fla. Stat.

942FINDINGS OF FACT

945Parties

9461. The Agency is statutorily responsible for administering

954the Certificate of Need (CON) program and the promulgation of

964rules pertaining to tertiary health services.

9702. Promise Healthcare, Inc., is located at 999 Yamato

979Road, Third Floor, Boca Raton, Florida. Promise's wholly-owned

987subsidiary, Promise Healthcare of Florida III, Inc., has

995received approval to construct and operate an LTCH in AHCA

1005Health Service Planning District (District) 3. See Promise

1013Healthcare of Florida III, Inc. v. State of Florida, Agency for

1024Health Care Administration , Case No. 06-0568CON (DOAH April 10,

10332008; AHCA May 16, 2008).

10383. Select owns and operates an LTCH in Orlando, Florida,

1048within District 7.

10514. Petitioners related corporations are currently and have

1059been applicants in proceedings before the Division of

1067Administrative Hearings (DOAH) seeking to establish LTCHs in the

1076State of Florida. Id. See also Select Specialty Hospital -

1086Marion, Inc. v. State of Florida, Agency for Health Care

1096Administration , Case No. 04-3150CON (DOAH July 11, 2006; AHCA

1105Sept. 23, 2006); Select Specialty Hospital - Broward, Inc. v.

1115Agency for Health Care Administration , Case No. 07-0597CON and

1124Promise Healthcare of Florida X, Inc. v. Agency for Health Care

1135Administration , Case No. 07-0598CON (Consolidated).

1140The Proposed Rule

11435. In December 2005 and September 2006, the Agency

1152published separate notices of proposed rule development

1159proposing to include long-term care hospitals within the rule

1168definition of tertiary health service.

11736. On June 8, 2007, the Agency published a copy of the

1185proposed rule at issue in this proceeding in the Florida

1195Administrative Weekly . The proposed rule is one of several

1205proposed changes to Florida Administrative Code Rule 59C-1.002,

1213providing definitions. The stated purpose and effect of the

1222entire proposed rule changes to Rule 59C-1.002 is "to amend the

1233rule that defines terms in Chapter 59C-1, F.A.C. due to recent

1244statutory changes "

12467. On July 13, 2007, a public hearing was held.

12568. Proposed rule 59C-1.002(41)(i) provides: "'Tertiary

1262health service' means a health service. . . . .The types of

1274tertiary services to be regulated under the Certificate of Need

1284Program in addition to those listed in Florida Statutes include:

1294. . . (i) Long-term care hospitals.

13019. The Agency relies on Sections 408.034(6) and 408.15(8),

1310Florida Statutes, as the specific authority for all of the

1320changes to Rule 59C-1.002, including subsection(41)(i). All of

1328the proposed rule changes implement Sections 408.033(1)(a),

1335408.036(1)-(3), 408.037(1), 408.039(1) and (2), and 651.118,

1342Florida Statutes. See also endnote 3. ("'Law implemented'

1351means the language of the enabling statute being carried out or

1362interpreted by an agency through rulemaking." Ch. 2008-104,

1370§ 2, Laws of Fla.)

137510. Section 408.034(6) authorizes the Agency to adopt

1383rules necessary to implement Sections 408.031-408.045, known as

1391the "Health Facility and Services Development Act." See also

1400§ 408.15(8), Fla. Stat., providing similar authority.

140711. Section 408.033(1)(a) pertains to Local Health

1414Councils.

141512. Section 408.036(1)-(3) include projects that are

1422subject to CON review, including expedited review, and projects

1431that are exempt from CON review. (The new construction or

1441establishment of additional health care facilities, which

1448includes long-term care hospitals by definition, see Section

1456408.032(8), Florida Statutes, are subject to CON review.)

146413. Section 408.037(1) pertains to CON application

1471content.

147214. Section 408.039(1) and (2) pertains to CON review

1481cycles and letters of intent, respectively.

148715. Section 651.118 pertains generally to the Agency's

1495authority regarding nursing home beds and sheltered nursing home

1504beds.

1505Statutory Definitions

150716. "'Health services' means inpatient diagnostic,

1513curative, or comprehensive medical rehabilitative services and

1520includes mental health services. Obstetric services are not

1528health services for purposes of ss. 408.031-408.045."

1535§ 408.032(9), Fla. Stat.

153917. In 2004, the Legislature amended the definition of

"1548health services" as follows: "'Health services' means inpatient

1556diagnostic, curative, or comprehensive medical rehabilitative

1562services and includes mental health services. Obstetrical

1569services are not health services for purposes of ss. 408.031-

1579408.045." Ch. 2004-383, § 2, Laws of Fla. (emphasis in

1589original).

159018. "'Health care facility' means a hospital, long-term

1598care hospital. . . ." § 408.032(8), Fla. Stat.

160719. "'Hospital' means a health care facility licensed

1615under chapter 395." § 408.032(11), Fla. Stat.

162220. "Hospital" is defined in Section 395.002(12), Florida

1630Statutes. "'Hospital' means any establishment that" offers

"1637services more intensive than those required for room, board,

1646personal services, and general nursing care, and offers

1654facilities and beds for use beyond 24 hours by individuals

1664requiring diagnosis, treatment, or care for illness, injury,

1672deformity, infirmity, abnormality, disease, or pregnancy. . . ."

1681§ 395.002(12)(a)-(b), Fla. Stat.

168521. The parties stipulated that the Agency licenses LTCH

1694facilities as Class 1 general hospitals.

170022. Generally, a Class 1 general hospital is a "basic

1710multipurpose hospital." Like Class 1 general hospitals, LTCHs

1718are subject to CON review and approval prior to offering those

1729services. Unlike a Class 1 general hospital, a Class I LTCH

1740seeks exclusion from the acute care Medicare prospective payment

1749system for inpatient services.

175323. "'General hospital' means any facility which meets the

1762provisions of subsection (12) and which regularly makes its

1771facilities and service available to the general population."

1779§ 395.002(10), Fla. Stat. See also § 395.002(28), Fla. Stat.

1789for a definition of "specialty hospital." For example, a

1798freestanding children's hospital is classified as a Class 3

1807specialty hospital because it provides services to a specialized

1816population related to gender or age. Comprehensive

1823rehabilitation hospitals are classified as Class 2 specialty

1831hospitals. Gregg deposition at 35-39.

183624. If a Class 1 general hospital desires to add a

1847tertiary health service, such as pediatric cardiac

1854catheterization, the hospital would need to obtain a CON.

186325. Aside from LTCHs and perhaps some referral hospitals,

1872the Agency believes a comprehensive inpatient rehabilitation

1879facility is an example of a facility providing services that are

1890high in intensity, complexity, or a specialized or limited

1899application at a high cost associated with the Medicare program.

1909Gregg deposition at 36-37.

191326. The new construction or establishment of additional

1921health care facilities, including an LTCH, is subject to CON

1931review. § 408.036(1)(b), Fla. Stat. 1

193727. Conversions from one type of health care facility to

1947another, including the conversion from a general hospital, a

1956specialty hospital, or a long-term care hospital are also

1965subject to CON review. § 408.036(1)(c), Fla. Stat. See endnote

19755.

197628. Also, unless exempt, all health care-related projects

1984requesting "[t]he establishment of tertiary health services,

1991including inpatient comprehensive rehabilitation services" are

1997subject to CON review. § 408.036(1)(f), Fla. Stat.

200529. An LTCH desiring to offer a tertiary health service is

2016required to obtain a CON in order to provide the service.

202730. LTCHs, like other general hospitals, can add

2035additional beds without CON review by filing an appropriate

2044notice with the Agency.

204831. "'Long-term care hospital' means a hospital licensed

2056under chapter 395 which meets the requirements of 42 C.F.R.

2066s. 412.23(e) [ 2 ] and seeks exclusion from the acute care Medicare

2079prospective payment system for inpatient hospital services."

2086§ 408.032(13), Fla. Stat. See also Fla. Admin. Code R. 59C-

20971.002(28), as amended, which mirrors the statutory definition.

210532. In 2004, the Legislature amended the definition of

2114long-term care hospital in Section 408.032(13), adding the terms

"2123acute care" before "Medicare." Ch. 2004-383, § 2, Laws of Fla. 3

213533. "'Tertiary health service' means a health service

2143which, due to its high level of intensity, complexity,

2152specialized or limited applicability, and cost, should be

2160limited to, and concentrated in, a limited number of hospitals

2170to ensure the quality, availability, and cost-effectiveness of

2178such service. Examples of such service include, but are not

2188limited to, pediatric cardiac catheterization, pediatric open-

2195heart surgery, organ transplantation, neonatal intensive care

2202units, comprehensive rehabilitation, and medical or surgical

2209services which are experimental or developmental in nature to

2218the extent that the provision of such services is not yet

2229contemplated within the commonly accepted course of diagnosis or

2238treatment for the condition addressed by a given service. The

2248agency shall establish by rule a list of all tertiary health

2259services. § 408.032(17), Fla. Stat.(emphasis added). 4

226634. In 2004, the Legislature added "pediatric cardiac

2274catheterization" and "pediatric open-heart surgery" to the

2281statutory list of tertiary health services and deleted

"2289specialty burn units". Ch. 2004-383, § 2, Laws of

2299Fla.(emphasis in original). 5

230335. By its terms, the statutory list of tertiary health

2313services is not exhaustive. The Agency reviews this list

2322periodically.

232336. To accomplish the legislative purpose stated in the

2332statutory definition of tertiary health service, the Agency

2340includes a list of tertiary health services in Florida

2349Administrative Code Rule 59C-1.002(41)(a)-(j).

235337. Like its statutory counterpart, Section 408.032(17),

2360Florida Statutes, all of the items listed in Rule 59C-

23701.002(41(a)-(j) are health services, which, by definition,

"2377should be limited to, and concentrated in, a limited number of

2388hospitals to ensure the quality, availability, and cost-

2396effectiveness of such service." Fla. Admin. Code R. 59C-

24051.002(41).

240638. Over time, the Agency has added several tertiary

2415health services, such as heart, kidney, liver, bone marrow,

2424lung, pancreas, islet cells, and heart/lung transplantation, and

2432adult open heart surgery. The Agency proposes to delete

2441neonatal and pediatric cardiac and vascular surgery, and

2449pediatric oncology and hematology, from the list and add

2458pediatric cardiac catheterization and pediatric open-heart

2464surgery to the list, the latter reflecting the 2004 statutory

2474amendments. See proposed rule 59C-1.002(41)(a)-(j).

2479The Agency's Rationale for the Proposed Rule

248639. According to the Agency, Section 408.032(17) provides

2494a broad definition of tertiary health services and the Agency

2504has the authority to decide if certain services, due to their

2515complexity and cost, should be added to or deleted from the list

2527of tertiary health services.

253140. Notwithstanding the stated purpose and effect of the

2540proposed rule, see Finding of Fact 6, "[t]he Agency has proposed

2551to include long term care hospital (LTCH) services as a tertiary

2562service in the [CON] program because the services are intense,

2572complex, specialized and costly." See AHCA's Motion for Summary

2581Final Order, "Rationale for Proposing Long Term Care Hospital

2590Services as a Tertiary Service in the CON Program" at 1.

260141. In attachments to its Motion for Final Summary Order,

2611the Agency provided information that the Agency believes

2619demonstrates that LTCH services are tertiary health services.

2627The Agency contends that "[t]he undisputed evidence shows that a

2637long term care hospital is a tertiary health service" and

2647further asserts "[t]here are no genuine issues of material fact

2657present in this case." AHCA's Motion at 2, ¶¶ 2 and 3.

266942. For the Agency, "[t]here is really no such thing as a

2681tertiary hospital. Tertiary has to do with the services that

2691are provided." Within the Agency's framework, tertiary health

2699services are "a combination of specialized, complicated, complex

2707services that are a high cost." Further, "[t]hey are somewhat

2717unique. They are high-end services that are the most complex,

2727the most technologically advanced, the most difficult to

2735provide, the most resource intensive, and inherently limited as

2744a result." According to the Agency, LTCHs are health services

2754that provide a high level of intensity, treat complex patients,

2764and have a high cost associated with the services provided.

2774Gregg deposition at 30-33, 48-53.

277943. By the proposed rule, the Agency proposes to make

2789services that are provided in an LTCH a tertiary health service.

2800But, if those same services are provided in some other type of

2812facility, they are not LTCH services. Gregg deposition at 48-

282249. 6

282444. The Agency's approach is based in part on several

2834reports published by, for example, MedPAC, which characterize

2842the role of the LTCH to provide post-acute care to a small

2854number of medically complex patients at a high cost and for

2865relatively extended periods. Id. at 21-29, 67-68. (The MedPAC

2874reports relied on by the Agency do not define tertiary services.

2885Id. at 58.)

288845. The Agency's approach is also based on the experience

2898of the Agency in reviewing LTCH CON applications and developing

2908an understanding of the complex patient population treated at

2917LTCHs. Id. at 29, 68. See also AHCA's Motion at Gregg

2928affidavit and supporting information.

293246. The Agency's rationale for the proposed rule is

2941informative and thoughtful, but not material to the disposition

2950of this rule challenge in light of the facial challenge to the

2962proposed rule as written. See endnotes 7 and 13.

297147. If the case was resolved on the current record, none

2982of the parties would be entitled to entry of a final order as a

2996matter of law if the issue was whether LTCH services within an

3008LTCH are tertiary health services because whether LTCH services

3017provided within an LTCH are tertiary health services requires

3026the resolution of genuine issues of material fact. Compare ,

3035e.g. , Petitioners' Motion for Summary Final Order, Exhibit 9

3044(Kornblatt affidavit) with AHCA's Motion for Summary Final

3052Order, Gregg affidavit and supporting information. Rather, the

3060challenge is resolved based on an evaluation of the proposed

3070rule in light of the plain meaning of several statutory

3080provisions.

3081CONCLUSIONS OF LAW

3084Jurisdiction

308548. The Division of Administrative Hearings has

3092jurisdiction over the parties to and the subject matter of this

3103Fla. Stat.

3105Standing

310649. No issue is raised regarding the standing of Promise

3116and Select. Nevertheless, Promise and Select have standing to

3125participate as parties in this proceeding.

3131Invalid Exercise of Delegated Legislative Authority

313750. Any substantially affected person may seek an

3145administrative determination of the invalidity of any proposed

3153rule by filing a petition seeking such a determination with the

3164Division of Administrative Hearings within the time set forth in

3174Section 120.56(2)(a), Florida Statutes. In this proceeding,

3181Promise and Select have the burden of going forward and the

3192Agency then has the burden to prove by a preponderance of the

3204evidence that the proposed rule is not an invalid exercise of

3215delegated legislative authority as to the objections raised.

3223be valid or invalid. § 120.56(2)(c), Fla. Stat. 7

323251. "'Invalid exercise of delegated legislative authority'

3239means action that goes beyond the powers, functions, and duties

3249delegated by the Legislature. A proposed or existing rule is an

3260invalid exercise of delegated legislative authority if,"

3267material here, the rule "enlarges, modifies, or contravenes the

3276specific provisions of law implemented, citation to which is

3285required by s. 120.54(3)(a)1," [ 8 ] or is "arbitrary or

3296capricious." § 120.52(8)(c) and (e), Fla. Stat., as amended,

3305see Ch. 2008-104, § 2, Laws of Fla. "A rule is arbitrary if it

3319is not supported by logic or the necessary facts; a rule is

3331capricious if it is adopted without thought or reason or is

3342irrational." § 120.52(8)(e), Fla. Stat.

334752. Pursuant to Section 120.536(1), Florida Statutes,

"3354[a]n agency may adopt only rules that implement or interpret

3364the specific powers and duties granted by the enabling statute."

3374See also Bd. of Trustees of the Internal Improvement Trust Fund

3385v. Day Cruise Association, Inc. , 794 So. 2d 696, 700 (Fla. 1st

3397DCA 2001) (agency may adopt rules "only where the Legislature

3407has enacted a specific statute, and authorized the agency to

3417implement it, and then only if the (proposed) rule implements or

3428interprets specific powers or duties").

343453. "Tertiary health service" is defined by statute and

3443several tertiary health services are listed. 9 By its terms, the

3454statutory definition is not exhaustive. 10 The Legislature

3462granted the Agency the express authority and discretion to add,

3472by rule, tertiary health services to the statutory list and

3482thereby implement this specific statutory power and duty.

349054. The issue is whether the Agency exceeded its authority

3500by proposing to include "long-term care hospitals" as a

"3509tertiary health service" in light of the statutory definition

3518and other statutes implemented by the proposed rule? 11 Stated

3528otherwise, does the inclusion of "long-term care hospitals"

3536within the rule definition of "tertiary health service" enlarge,

3545modify, or contravene the specific laws implemented, citation to

3554which is required by Section 120.54(3)(a)1., Florida Statutes? 12

3563Statutory Interpretation

356555. The guiding purpose in construing a statute is to give

3576effect to the Legislature's intent. State v. J.M. , 824 So. 2d

3587105, 109 (Fla. 2002). A determination of legislative intent "is

3597derived primarily from the language of the statute." State v.

3607Bodden , 877 So. 2d 680, 685 (Fla. 2004), cert. denied , 125 S.

3619Ct. 628 (2004). Further, when construing a statute, courts

"3628look first at the statute's plain meaning." Moonlit Waters

3637Apartments, Inc. v. Cauley , 666 So. 2d 898, 900 (Fla. 1996). If

3649the intent is unclear from the plain language of the statute,

3660only then are rules of statutory construction and legislative

3669history used to determine legislative intent. BellSouth

3676Telecommunications, Inc. v. Meeks , 863 So. 2d 287, 289 (Fla.

36862003).

368756. Where the Legislature uses particular words to define

3696a term, a court does not have the authority to redefine it.

3708Racetrac Petroleum, Inc. v. Delco Oil, Inc. , 721 So. 2d 376,

3719377-378 (Fla. 5th DCA 1998). Also, courts are extremely

3728reluctant to add words to a statute. Armstrong v. City of

3739Edgewater , 157 So. 2d 422, 425 (Fla. 1963).

374757. Here, the term "tertiary health service" is defined,

3756but the list is not exhaustive by the plain terms of the

3768definition and the Agency has the authority to establish by rule

3779a list of tertiary health services in addition to those listed

3790in Section 408.032(17), Florida Statutes.

379558. An agency is accorded broad discretion and deference

3804in the interpretation of the statutes which it administers. See

3814Bd. of Podiatric Med. v. Fla. Med. Ass'n , 779 So. 2d 658, 660

3827(Fla. 1st DCA 2001) (citing Public Employees Relations Comm'n v.

3837Dade County Police Benevolent Ass'n , 467 So. 2d 987 (Fla.

38471985)). Also, an agency's interpretation "should be upheld when

3856it is within the range of permissible interpretations." Id.

3865(citing Bd. of Trustees of Internal Improvement Trust Fund v.

3875Levy , 656 So. 2d 1359 (Fla. 1st DCA 1995)). See also Fla. Dep't

3888of Educ. v. Cooper , 858 So. 2d 394, 396 (Fla. 1st DCA 2003)("If

3902the agency's interpretation is within the range of possible and

3912reasonable interpretations, it is not clearly erroneous and

3920should be affirmed."(citations omitted)).

392559. The court has recognized and supported the principle

3934that rules may clarify and flesh out the details of an enabling

3946statute. Agencies utilize their expertise by creating rules to

3955effectuate specific duties. "The Legislature itself is hardly

3963suited to anticipate the endless variety of situations that may

3973occur or to rigidly prescribe the conditions or solutions to the

3984often fact-specific situations that arise." Avatar Dev. Corp.

3992v. State , 723 So. 2d 199, 204 (Fla. 1998).

400160. However, "judicial adherence to the agency's view is

4010not demanded when it is contrary to the statute's plain

4020meaning." Sullivan v. Dep't of Envtl. Prot. , 890 So. 2d 417,

4031420 (Fla. 1st DCA 2004)(citations omitted). See also Willette

4040v. Air Products , 700 So. 2d 397, 399 (Fla. 1st DCA 1997)

4052(statute takes precedence over a rule); Cortes v. State Bd. of

4063Regents , 655 So. 2d 132, 136 (Fla. 1st DCA 1995)(explaining that

4074the legislature may authorize administrative agencies to

4081interpret, but never to alter statutes). Also, "an

4089administrative agency may not adopt a rule which conflicts with

4099or modifies an existing statute." State, Dep't of Transp. v.

4109Pan Am. Constr. Co. , 338 So. 2d 1291, 1293 (Fla. 1st DCA

41211976)(citations omitted), appeal dismissed , 345 So. 2d 427 (Fla.

41301977).

413161. There is no dispute that a health care facility such

4142as an LTCH provides services inside the facility. As defined by

4153statute, all general or specialty hospitals, including LTCHs,

4161are facilities that offer services, including health services.

4169If CON approved, any of these facilities may offer tertiary

4179health services.

418162. It may be that an LTCH is a tertiary facility that

4193should be limited in number because of the nature of the patient

4205population, e.g. , acuity levels, complex nature of the patient

4214care provided, and the cost of the services rendered. But the

4225Legislature has the prerogative to make this decision and has

4235not done so.

423863. The Legislature defines an LTCH and includes an LTCH

4248in the definition of health care facility. No health care

4258facilities are included in the definition of health services.

4267The definition of tertiary health service, a sub-set of health

4277services, and the examples which follow the statutory

4285definition, do not include any health care facilities. As a

4295matter of law, an LTCH is not a tertiary health service. See

4307endnote 13.

430964. Given the plain meaning of the relevant statutes

4318referenced herein and those relied on by the Agency, the

4328proposed rule enlarges the statutory definitions of health

4336services and tertiary health service, Subsections 408.032(9) and

4344(17), Florida Statutes, and, accordingly, the proposed rule is

4353an invalid exercise of delegated legislative authority. 13

4361CONCLUSION

4362Based on the foregoing Findings of Fact and Conclusions of

4372Law, it is:

4375ORDERED that the Motion for Summary Final Order filed by

4385Promise and Select is granted; the proposed rule 59C-

43941.002(41)(i) is determined to be an invalid exercise of

4403delegated legislative authority; and the Agency's Motion for

4411Summary Final Order is denied. The final hearing scheduled for

4421November 5-7, 2008, is canceled.

4426DONE AND ORDERED this 23rd day of September, 2008, in

4436Tallahassee, Leon County, Florida.

4440S

4441CHARLES A. STAMPELOS

4444Administrative Law Judge

4447Division of Administrative Hearings

4451The DeSoto Building

44541230 Apalachee Parkway

4457Tallahassee, Florida 32399-3060

4460(850) 488-9675 SUNCOM 278-9675

4464Fax Filing (850) 921-6847

4468www.doah.state.fl.us

4469Filed with the Clerk of the

4475Division of Administrative Hearings

4479this 23rd day of September, 2008.

4485ENDNOTES

44861 / In its motion, the Agency states in part: "Additionally,

4497including Long Term Care Hospital on the list of tertiary

4507services is to allow the [CON] review process to take place

4518prior to approval of this type of establishment. This rationale

4528is consistent with the letter of the law and the overall

4539legislative intent of Section 408.032(17), Florida Statutes."

4546AHCA's Motion at 8, ¶ 32. See also AJSF at 13, ¶ 56. By

4560statute, new LTCHs are required to undergo CON review and

4570approval. While the proposed rule may add a new criterion for

4581the Agency's consideration when LTCHs are reviewed, the proposed

4590rule does not establish a requirement for CON review for new

4601LTCHs.

46022

4603long-term care hospitals must have provider agreements and "an

4612average Medicare inpatient length of stay of greater than 25

4622days (which includes all covered and noncovered days of stay of

4633Medicare patients) as calculated under paragraph (e)(3) of this

4642section" or an alternative average length of stay as provided

4652under subsection (e)(2)(ii).

46553 / In proposing the proposed rule, the Agency also relies in

4667part on the 2004 amendment to Section 408.032(13). It is the

4678only provision of Chapter 2004-383, Laws of Florida, relied on

4688by the Agency as statutory support for the proposed rule. The

4699Agency also relies on Section 408.032(17) as statutory support

4708for the proposed rule. Gregg deposition at 14-16. See also

4718endnotes 11 and 12.

47224 / No party suggests that LTCHs are experimental or

4732developmental in nature.

47355 / Also, in 2004, the Legislature amended Section 408.036(1)(c),

4745Florida Statutes, to require CON review when a general,

4754specialty, or long-term care hospital is converted. Ch. 2004-

4763383, § 6, Laws of Fla.

47696 / Stated otherwise, according to the Agency, the proposed rule

4780captures the services provided in an LTCH, not the LTCH building

4791per se. "A hospital is a licensed provider of hospital

4801services; it's not the building" that is the subject of the

4812proposed rule. Id. at 64-65.

48177 / This proceeding involves a facial challenge to the proposed

4828rule and not a challenge to this subsection as applied. See

4839generally Beverly Health and Rehabilitative Services, Inc. v.

4847Agency for Health Care Admin. , 708 So. 2d 616 (Fla. 1st DCA

48591998); Fairfield Communities v. Florida Land and Water

4867Adjudicatory Comm'n , 522 So. 2d 1012 (Fla. 1st DCA 1988).

48778 / See , e.g. , Fla. Petroleum Marketers and Convenience Store

4887Ass'n v. Dep't of Envtl. Prot. , DOAH Case No. 05-0529RP (DOAH

4898June 16, 2005), and cases cited therein at Conclusion of Law 39.

49109 / "Under the doctrine of noscitur a sociis , the meaning of

4922statutory terms, and the legislative intent behind them, may be

4932discovered by referring to words associated with them in the

4942statute." Turnberry Isle Resort and Club v. Fernandez , 666 So.

49522d 254, 256 (Fla. 3d DCA 1996)(citation omitted). All of the

4963services listed are health services, not health care facilities.

4972Even "neonatal intensive care units" is classified as a health

4982service ("[e]xamples of such service include"), not a facility.

4993§ 408.032(8),(9),(11),(13), and (17), Fla. Stat.

500210 / The words "include, but are not limited to," see Section

5014408.032(17), Florida Statutes, appear to be words of

5022enlargement, not of limitation and therefore convey the

5030conclusion that there are other terms includable, though not

5039specifically enumerated by the statute. See generally Argosy

5047Limited v. Hennigan , 404 F.2d 14, 20 (5th Cir. 1968); Miami

5058Country Day School v. Bakst , 641 So. 2d 467, 469 (Fla. 3d DCA

50711994), rev. denied , 651 So. 2d 1195 (Fla. 1995); Yon v. Fleming ,

5083595 So. 2d 573, 577 (Fla. 4th DCA 1992), rev. denied , 599 So. 2d

50971281 (Fla. 1992); Op. Att'y Gen. Fla. 081-40 (1981). This

5107general statement is buttressed by the express terms of the

5117definition of tertiary health service as explained herein.

512511 / The implementing statutes referred to in proposed rule 59C-

51361.002 do not support proposed rule 59C-1.002(41)(i). See

5144Findings of Fact 9-15 and endnote 3.

515112 / Section 408.032(17) provides express authority for the

5160Agency to adopt a rule pertaining to tertiary health services

5170and Section 408.032(17) is implemented by Florida Administrative

5178Code Rule 59C-1.002(41) and by the proposed rule, subsection

5187(41)(i). Nevertheless, Section 408.032(17) was not cited as an

5196implementing statute by the Agency in the published version of

5206the proposed rule, see Section 120.54(3)(a)1., Florida Statutes.

"5214The failure of an agency to follow the applicable rulemaking

5224procedures or requirements set forth in this chapter shall be

5234presumed to be material; however, the agency may rebut this

5244presumption by showing that the substantial interests of the

5253petitioner and the fairness of the proceedings have not been

5263impaired." § 120.56(1)(c), Fla. Stat. Here, no interests have

5272been impaired.

527413 / Given the disposition herein, it is unnecessary to resolve

5285whether long-term care services provided in an LTCH is a

5295tertiary health service.

5298COPIES FURNISHED :

5301Richard Shoop, Agency Clerk

5305Agency for Health Care Administration

53102727 Mahan Drive, Mail Station 3

5316Tallahassee, Florida 32308

5319Craig H. Smith, General Counsel

5324Agency for Health Care Administration

5329Fort Knox Building, Suite 3431

53342727 Mahan Drive, Mail Stop 3

5340Tallahassee, Florida 32308

5343Holly Benson, Secretary

5346Agency for Health Care Administration

5351Fort Knox Building, Suite 3116

53562727 Mahan Drive

5359Tallahassee, Florida 32308

5362Liz Cloud, Program Administrator

5366Administrative Code

5368Department of State

5371R. A. Gray Building, Suite 101

5377Tallahassee, Florida 32399

5380F. Scott Boyd, Executive Director

5385and General Counsel

5388Administrative Procedures Committee

5391Holland Building, Room 120

5395Tallahassee, Florida 32399-1300

5398F. Philip Blank, Esquire

5402Blank & Meenan, P.A.

5406204 South Monroe Street

5410Tallahassee, Florida 32301

5413Mark A. Emanuele, Esquire

5417Panza, Maurer, & Maynard, P.A.

5422Bank of America Building, Third Floor

54283600 North Federal Highway

5432Fort Lauderdale, Florida 33308

5436Bart O. Moore, Esquire

5440Agency for Health Care Administration

5445Fort Knox Building III, Mail Stop 3

54522727 Mahan Drive, Suite 3431

5457Tallahassee, Florida 32308

5460NOTICE OF RIGHT TO JUDICIAL REVIEW

5466A party who is adversely affected by this Final Order is

5477entitled to judicial review pursuant to Section 120.68, Florida

5486Statutes. Review proceedings are governed by the Florida Rules

5495of Appellate Procedure. Such proceedings are commenced by

5503filing one copy of a Notice of Appeal with the agency clerk of

5516the Division of Administrative Hearings and a second copy,

5525accompanied by filing fees prescribed by law, with the District

5535Court of Appeal, First District, or with the District Court of

5546Appeal in the appellate district where the party resides. The

5556Notice of Appeal must be filed within 30 days of rendition of

5568the order to be reviewed.

Select the PDF icon to view the document.
PDF
Date
Proceedings
PDF:
Date: 09/23/2008
Proceedings: DOAH Final Order
PDF:
Date: 09/23/2008
Proceedings: Request for Status Conference filed.
PDF:
Date: 09/23/2008
Proceedings: Summary Final Order. CASE CLOSED.
PDF:
Date: 09/18/2008
Proceedings: Promise and Select-Orlando`s Response to AHCA`s Motion for Summary Final Order filed.
PDF:
Date: 09/17/2008
Proceedings: Promise HealthCare, Inc.`s Witness List filed.
PDF:
Date: 09/17/2008
Proceedings: Select Specialty Hospital-Orlando, Inc.`s Witness List filed.
PDF:
Date: 09/15/2008
Proceedings: (Respondent`s) Witness List filed.
PDF:
Date: 09/12/2008
Proceedings: Select Specialty Hospital - Orlando, Inc.`s Motion for Extension of Time filed.
PDF:
Date: 09/12/2008
Proceedings: Agency`s Response to Promise and Select`s Motion for Summary Final Order filed.
PDF:
Date: 09/10/2008
Proceedings: Order (Promise Healthcare, Inc.`s Motion for Extension of Time is granted, on or before September 18, 2008, Petitioners may file a response to the Agency`s motion and the Agency may file a response to Petitioners` Motion for Summary Final Order).
PDF:
Date: 09/09/2008
Proceedings: Promise Healthcare, Inc.`s Motion for Extension of Time filed.
PDF:
Date: 09/05/2008
Proceedings: AHCA`s Motion for Summary Final Order filed.
PDF:
Date: 09/05/2008
Proceedings: Notice of Appearance of Additional Counsel (filed by S. Haston).
PDF:
Date: 09/02/2008
Proceedings: Amended Joint Stipulation of Facts filed.
PDF:
Date: 08/27/2008
Proceedings: Joint Stipulated Facts filed.
PDF:
Date: 08/25/2008
Proceedings: Order (Unopposed Motion for Extension of Time to Submit Stipulated Facts is granted).
PDF:
Date: 08/22/2008
Proceedings: Unopposed Motion for Extension of Time to Submit Stipulated Facts filed.
Date: 08/01/2008
Proceedings: CASE STATUS: Pre-Hearing Conference Held.
PDF:
Date: 07/29/2008
Proceedings: Notice of Status Conference filed.
PDF:
Date: 07/28/2008
Proceedings: Motion for Judicial Notice filed.
PDF:
Date: 07/28/2008
Proceedings: Promise and Select`s Notice of Filing filed.
PDF:
Date: 07/28/2008
Proceedings: Promise`s and Select`s Response to Order filed.
PDF:
Date: 07/28/2008
Proceedings: Promise and Select`s Motion for Summary Final Order filed.
PDF:
Date: 07/28/2008
Proceedings: Response to Order filed.
PDF:
Date: 07/11/2008
Proceedings: Order (on or before July 28, 2008, parties are requested to respond in writing to the following issues).
PDF:
Date: 06/25/2008
Proceedings: Notice of Unavailability filed.
PDF:
Date: 06/18/2008
Proceedings: Amended Order of Pre-Hearing Instructions.
PDF:
Date: 06/17/2008
Proceedings: (Proposed) Amended Order of Pre-hearing Instructions filed.
PDF:
Date: 06/03/2008
Proceedings: Notice of Hearing (hearing set for November 5 through 7, 2008; 9:00 a.m.; Tallahassee, FL).
Date: 06/03/2008
Proceedings: CASE STATUS: Pre-Hearing Conference Held.
Date: 06/03/2008
Proceedings: CASE STATUS: Pre-Hearing Conference Held.
PDF:
Date: 06/03/2008
Proceedings: Amended Notice of Hearing filed.
PDF:
Date: 06/02/2008
Proceedings: Notice of Telephonic Hearing filed.
PDF:
Date: 05/28/2008
Proceedings: Joint Status Report filed.
PDF:
Date: 05/05/2008
Proceedings: Order (Joint Motion for Extension of Time to File Status Report is granted, parties shall have up to and Including May 27, 2008, to file their status report).
PDF:
Date: 05/02/2008
Proceedings: Joint Motion for Extension of Time to File Status Report filed.
PDF:
Date: 01/07/2008
Proceedings: Order Granting Continuance (parties to advise status by May 5, 2008).
PDF:
Date: 01/07/2008
Proceedings: Stipulation filed.
PDF:
Date: 01/07/2008
Proceedings: Joint Motion for Continuance of Final Hearing filed.
PDF:
Date: 01/04/2008
Proceedings: Order (denying Select Specialty Hospital - Orlando, Inc.`s Motion in Limine).
PDF:
Date: 01/03/2008
Proceedings: Notice of Pre-hearing Conference filed.
PDF:
Date: 01/02/2008
Proceedings: Select Specialty Hospital - Orlando, Inc.`s Motion In Limine filed.
PDF:
Date: 12/31/2007
Proceedings: Select Specialty Hospital-Orlando, Inc.`s Notice to Produce at Trial filed.
PDF:
Date: 12/26/2007
Proceedings: Promise Healthcare, Inc.`s Response and Objections to the Agency for Health Care Administration`s First Request for Production of Documents filed.
PDF:
Date: 12/24/2007
Proceedings: Petitioner Select Specialty Hospital - Orlando, Inc.`s Response and Objections to the Agency for Health Care Administration`s First Request For Production of Documents filed.
PDF:
Date: 12/24/2007
Proceedings: Order Granting Continuance and Re-scheduling Hearing (hearing set for January 10 and 11, 2008; 9:00 a.m.; Tallahassee, FL).
PDF:
Date: 12/21/2007
Proceedings: Unopposed Motion to Re-Set Final Hearing Dates From January 9, 2008 and January 10, 2008 to January 10, 2008 and January 11, 2008 filed.
PDF:
Date: 12/19/2007
Proceedings: Petitioner`s Request for Production filed.
PDF:
Date: 12/19/2007
Proceedings: Request for Production filed.
PDF:
Date: 12/18/2007
Proceedings: Cross-Notice of Taking Rule 1.310(b)(6) Deposition filed.
PDF:
Date: 12/10/2007
Proceedings: Amended Notice of Taking Rule 1.310(b)(6) Deposition filed.
PDF:
Date: 11/29/2007
Proceedings: Notice of Taking Rule 1.310(b)(6) Deposition filed.
PDF:
Date: 11/29/2007
Proceedings: Promise Healthcare, Inc.`s First Request for Production of Documents to the Agency for Health Care Administration filed.
PDF:
Date: 08/28/2007
Proceedings: Order Granting Leave to Intervene (Select Specialty Hospital - Orlando, Inc.).
PDF:
Date: 08/23/2007
Proceedings: Petition to Intervene (Select Specialty Hospital - Orlando, Inc.) filed.
PDF:
Date: 08/02/2007
Proceedings: Order Granting Continuance and Re-scheduling Hearing (hearing set for January 9 and 10, 2008; 9:00 a.m.; Tallahassee, FL).
Date: 08/01/2007
Proceedings: CASE STATUS: Pre-Hearing Conference Held.
PDF:
Date: 07/27/2007
Proceedings: Notice of Appearance (filed by B. Moore).
PDF:
Date: 07/27/2007
Proceedings: Notice of Telephonic Hearing filed.
PDF:
Date: 07/25/2007
Proceedings: Notice of Hearing (hearing set for August 21, 2007; 9:00 a.m.; Tallahassee, FL).
PDF:
Date: 07/25/2007
Proceedings: Order of Pre-hearing Instructions.
PDF:
Date: 07/25/2007
Proceedings: Order of Consolidation (DOAH Case Nos. 07-3403RP and 07-3404RP).
PDF:
Date: 07/25/2007
Proceedings: Order of Assignment.
PDF:
Date: 07/24/2007
Proceedings: Rule Challenge transmittal letter to Liz Cloud from Claudia Llado copying Scott Boyd and the Agency General Counsel.
PDF:
Date: 07/24/2007
Proceedings: Petition to Determine Invalidity of Proposed Rule filed.

Case Information

Judge:
CHARLES A. STAMPELOS
Date Filed:
07/24/2007
Date Assignment:
07/25/2007
Last Docket Entry:
09/23/2008
Location:
Tallahassee, Florida
District:
Northern
Agency:
Agency for Health Care Administration
Suffix:
RP
 

Counsels

Related DOAH Cases(s) (7):

Related Florida Statute(s) (15):

Related Florida Rule(s) (1):