09-006021 Mvp Health, Inc. vs. Agency For Health Care Administration Status: Closed Recommended Order on Thursday, April 22, 2010.

Summary: Pet.'s application for a license as a home health agency is "considered approved" as Resp. failed timely to grant or deny the application after receiving info from Pet. that completed the application; a license must be issued to Pet. subject to the law.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

MVP HEALTH, INC., )

)

Petitioner, )

)

vs. ) Case No. 09-6021

)

AGENCY FOR HEALTH CARE )

ADMINISTRATION, )

)

Respondent. )

)

RECOMMENDED ORDER

This case came before Administrative Law Judge John G.

Van Laningham for final hearing on February 26, 2010, in

Tallahassee, Florida.

APPEARANCES

For Petitioner: Jay Adams, Esquire

Broad and Cassel

Post Office Box 11300

Tallahassee, Florida 32302

For Respondent: D. Carlton Enfinger, II, Esquire

Michael J. Hardy, Esquire

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop No. 3

Tallahassee, Florida 32308

STATEMENT OF THE ISSUES

The primary issue in this case is whether Petitioner's

application for licensure as a home health agency was complete

upon Petitioner's submission of additional information to

Respondent within 21 days after Respondent had timely notified

Petitioner of the need to provide additional information. If

Petitioner failed to provide Respondent with information which

Respondent timely requested, then Respondent may deny

Petitioner's application as incomplete, as it intended to do,

provided the information Respondent sought is information

Respondent is permitted by law to require. On the other hand,

if Petitioner's application was complete, then Petitioner's

application is "considered approved," because Respondent failed

to grant or deny the application within 60 days after receiving

additional information from Petitioner; in that event, a license

must be issued to Petitioner, subject to reasonable conditions

authorized by law.

PRELIMINARY STATEMENT

On October 20, 2009, Respondent Agency for Health Care

Administration issued a Notice of Intent to Deem Application

Incomplete and Withdrawn from Further Review, which informed

Petitioner MVP Health, Inc., that its pending application for

licensure as a home health agency would be rejected as

incomplete. Petitioner disagreed that its application was

incomplete and timely requested a formal hearing to resolve this

disputed issue of material fact. On November 3, 2009, the

matter was filed with the Division of Administrative Hearings.

The final hearing took place, after a one-month

continuance, on February 26, 2010, with both parties present.

Petitioner's only witness was Rey Gomez, the company's owner.

Petitioner's Exhibits 1 through 6 were received in evidence

without objection. Respondent did not call any witnesses or

tender any exhibits.

The final hearing Transcript was filed on March 12, 2010.

Each party timely filed a Proposed Recommended Order in

compliance with the deadline (March 22, 2010) that had been

established at hearing.

Unless otherwise indicated, citations to the Florida

Statutes refer to the 2009 Florida Statutes.

FINDINGS OF FACT

1. The Agency for Health Care Administration ("Agency" or

"AHCA") is the state agency responsible for regulating home

health agencies in Florida. In this capacity, the Agency

determines whether to approve applications for licensure as a

home health agency, and it has administrative jurisdiction to

enforce the laws governing such licensees, including the

authority to take disciplinary measures against licensees who

violate the applicable statutes and rules.

2. MVP Health, Inc. ("MVP"), is a corporation which, for a

time relevant to this case, held a license to operate as a home

health agency. On June 11, 2009, MVP filed an application with

AHCA seeking to obtain a new home health agency license,

notwithstanding that it was already licensed. Prompting this

seemingly unusual maneuver was the recent acquisition of 100

percent of the company's equity by an individual named Rey

Gomez, who had bought out the other shareholders. About one

week after submitting its application to AHCA, MVP voluntarily

stopped operating as a home health agency under its then-

existing license.

3. Pursuant to Sections 120.60(1) and 408.806(3), Florida

Statutes, which will be examined below, the Agency was required

to notify MVP, within 30 days after receiving MVP's application

for licensure, of any errors, omissions, or requests for

additional information. By letter dated July 10, 2009 (the

"Omissions Letter"), the Agency timely gave MVP such a notice,

which provided, in pertinent part, as follows:

Your application for a home health agency

license has been reviewed and was found to

be incomplete. Applicants for licensure

will receive only one omission letter

describing the corrections, omissions or

revisions needed to complete the

application. If the response to the

omission letter does not satisfactorily

address what is outlined below, the

application will be denied. Therefore,

pursuant to section 408.806(3)(b), Florida

Statutes, no further action can be taken

until the following is received:

* * *

Include a separate list showing all health

care entities licensed or registered in the

State of Florida that are also owned in

whole or in part by each of your controlling

interests as required by subsection

400.471(2)(g), F.S. Controlling interests

as defined in [section] 408.803, F.S.,

include the applicant or licensee; a person

or entity that serves as an officer of, is

on the board of directors[,] or has a 5

percent or greater ownership interest in the

management company or other entity, related

or unrelated[,] with which the applicant or

licensee contracts to manage the provider.

The term does not include a voluntary board

member.

* * *

You have listed Rey Gomez as the sole owner

of MVP Health Inc. We currently have a

licensed home health agency, MVP Health

Inc., HHA #29992195, which our records show

as being owned by Virginia Duby, Michael

Lee, and Priscilla Lee. We cannot process

an initial application for licensure from a

company for which we currently have an

active license if the owners of record on

that existing license differ from the owners

of record on the new application. A change

of ownership application was recently filed

for that agency but that application was

denied and withdrawn. Since then we have

come to understand that this company's

ownership was in dispute. Please submit

documentation that the legal issues of

ownership of this company have been finally

resolved. Please eliminate any

inconsistencies in the ownership of this

company regarding this initial licensure

application and HHA #29992195. Please

complete #2A Individual and/or Entity

Ownership of Licensee on Health Care

Licensing Application page 2 of 5 per

reporting requirements of Chapter 408, Part

II, Florida Statutes.

* * *

Please send the required information no

later than 21 days from the receipt of this

letter . If the applicant fails to submit

all of the information required in the

application within 21 days of being notified

by AHCA of the omissions, the application

will be denied and the fees shall be

forfeited as required in subsection

408.806(3)(b), Florida Statutes.

(Boldface and underlining in original.) There were, listed in

the Omissions Letter, other items as to which the Agency wanted

additional information, but none of these later became the

subject of dispute, and thus they require no further mention.

4. Following instructions, MVP filed the requested

additional information with AHCA on July 24, 2009, a date which

was well within 21 days after MVP's receipt of the Omissions

Letter. In its supplemental filing, as it had done previously

in its application, MVP identified Mr. Gomez and his wife,

Zenaida, as the corporation's only "controlling interests," and

represented that neither of them owned any part of any other

health care entities. MVP asserted also that Mr. Gomez was its

sole shareholder, just as it had done in the application.

5. On August 13, 2009, MVP voluntarily relinquished its

then-existing home health agency license. This was done in

response to the Agency's assertion, in the Omissions Letter,

that the Agency "cannot process an initial application for

licensure from a company for which we currently have an active

license if the owners of record on that existing license differ

from the owners of record on the new application." At the time,

Mr. Gomez believed that AHCA soon would issue MVP a new license,

whereupon MVP would be authorized to resume operations as a home

health agency.

6. The Agency, however, did not soon issue a license to

MVP. Instead, by letter dated October 20, 2009, which was

captioned, "Notice of Intent to Deem Application Incomplete and

Withdrawn From Further Review" (the "Withdrawal Notice"), the

Agency informed MVP that its application had been deemed

incomplete and would be withdrawn from further consideration. 1

The Agency described the "outstanding issues remaining for

licensure" as follows:

1. The applicant could not provide proof of

ownership of MVP Health Inc. The

ownership of this company has been in

dispute for over a year. The applicant

was asked to provide proof of ownership

of the company but did not do so. A

call to the Clerk of Courts in Miami

revealed that there is an ongoing legal

dispute that has not been resolved

regarding the ownership of MVP Health

Inc. Rey Gomez claims to be the sole

owner, however, there are three previous

owners who are involved in the ownership

dispute that is ongoing. The Agency

cannot issue a license to a corporation

where the ownership is not clear.

* * *

2. The applicant's accreditation was

terminated due to not providing services

since June of 2009. The home health

agency submitted a change of ownership

application which was subsequently

withdrawn and the license was

voluntarily terminated. The applicant

applied for an initial home health

license after the original license was

voluntarily terminated. In so doing,

the applicant needed to secure

accreditation within 120 days of receipt

of the initial application in the Home

Care Unit. That date would have been

October 8, 2009.

* * *

3. The applicant did not provide a list of

all health care entities licensed or

registered in the State of Florida that

are also owned by each controlling

interest.

7. In its Proposed Recommended Order, which was filed

after the final hearing in this case, the Agency conceded that

because "no evidence was entered to contradict" Mr. Gomez's

testimony that "neither he nor MVP Health, Inc. had an ownership

interest in any other health care facility," MVP "has met [its]

burden and must prevail on this point." The undersigned agrees

that, with regard to Item #3 in the foregoing list of alleged

deficiencies, MVP's application was complete, as a matter of

ultimate fact, no later than July 24, 2009, contrary to AHCA's

preliminary determination. No further discussion of this point

is required.

8. Regarding Item #1, it is the Agency's position that MVP

that "the legal issues of ownership of [MVP] have been finally

resolved." This contention is based on several undisputed facts

(to which the parties stipulated), namely: (1) Several persons

brought suit in the circuit court in Miami-Dade County seeking

to establish that they own, in the aggregate, 40 percent of

MVP's equity, as against Mr. Gomez's claim to be the company's

sole shareholder; (2) On October 28, 2009, the trial court

entered a judgment in Mr. Gomez's favor in this litigation,

determining that he owns 100 percent of MVP's shares; and (3) As

of the final hearing in this case, an appeal from that judgment

was pending in the Third District Court of Appeal.

9. The Agency argues that the mere existence of the

ongoing litigation clouds the issue of MVP's ownership, which in

turn necessarily makes MVP unable to "prove" Mr. Gomez's claim

of ownership, and that, without such proof, the Agency is

precluded from issuing a license. There are two problems with

AHCA's contention.

10. First, the mere fact that some persons (who are not

parties to, and did not testify in, this proceeding) dispute

certain statements in MVP's application, i.e. , that (a) Mr.

Gomez owns 100 percent of MVP's shares, and (b) Mr. Gomez and

his wife are the only two "controlling interests" of the

company, is not terribly persuasive evidence that MVP's

statements, which were made under oath, are untrue. In this

case, Mr. Gomez testified credibly that he is MVP's sole owner,

and that he and Mrs. Gomez are the company's officers. Mr.

Gomez's testimony in this regard is corroborated by the

stipulated fact that a judgment vindicating Mr. Gomez's claim of

ownership was rendered in a legal proceeding brought

specifically to defeat such claim. On the present record, the

undersigned does not hesitate to find, based on a preponderance

of the evidence, that the statements in MVP's application

regarding its owner and officers were true and complete.

11. Second, however, and more important, the issue in this

case is not whether MVP's statements regarding ownership were

true and complete, but whether such statements were complete .

This is because AHCA did not deny MVP's application on the

grounds that Mr. Gomez is not, in fact, the sole shareholder;

that MVP made a material misrepresentation in, or omitted a

material fact from, its application 2 ; or even that the ongoing

litigation is a per se barrier to the issuance of a license

(although the Agency seems to believe that this latter

proposition is true). Rather, the Agency deemed incomplete

MVP's application, and on that basis refused to consider whether

the application should be granted or denied "on the merits."

12. To be sure, the effect of AHCA's intended action, if

implemented, would be indistinguishable from denial; indeed,

such action——the withdrawal of an allegedly incomplete

application——properly can be (and sometimes is 3 ) called a denial.

But the basis of the action would be materially different from

that justifying the denial of a completed application. Simply

put, the failure of an applicant to meet the criteria for a

license, which results in a denial on the merits, is not, as a

logical matter, equal to the failure of an applicant to timely

provide requested information (or correct an identified error or

omission), which results, as a procedural matter, in a refusal

to consider (or to deny) an application consequently deemed to

be incomplete. It is one thing, in other words, to say, based

on all the necessary information, that a person is ineligible

for licensure. It is another thing to say that the person's

eligibility cannot and will not be determined because the person

has failed to provide all of the necessary information upon

which such a determination must be based. Because the Agency

has taken the position that MVP failed to submit all of the

information that the Agency needed in order to make a decision

whether or not to grant MVP's application for licensure, the

question in this case is not whether MVP in fact meets the

criteria for licensure, but whether MVP timely provided AHCA

with all of the information which the Agency requested and was

permitted by law to require.

13. The evidence in this case establishes clearly, and the

undersigned finds, that MVP timely provided AHCA with all of the

legally required information concerning its owner and officers

for which it was asked. As will be discussed below, the law

neither requires that an applicant provide, nor authorizes the

Agency to demand, as a prerequisite to licensure, "proof of

[corporate] ownership" in the form of a final judicial

determination of such issue where a legal dispute has arisen.

To the extent AHCA sought to require such information from MVP,

AHCA was not permitted by law to do so, and thus MVP's

application cannot be "deemed incomplete" based on MVP's

"failure" to provide such proof (which in this instance did not

even exist). MVP identified its owner and officers and provided

AHCA with identifying information about them in accordance with

the applicable law. No more was required of MVP to make its

application complete in regard to matter of ownership. 4

14. It is determined as a matter of ultimate fact that,

with regard to Item #1 in the Withdrawal Notice, MVP's

application was complete as of July 24, 2009, at the latest.

15. Item #2 in the Withdrawal Notice, which raised the

issue of accreditation for the first time, requires

consideration of additional facts not previously discussed. At

the time MVP submitted its application to AHCA, MVP was fully

accredited by an appropriate accrediting organization known as

The Joint Commission. This accreditation was effective

beginning February 3, 2009, and was valid for up to 39 months.

16. MVP's accreditation remained in effect up to, and

beyond, the date of AHCA's Withdrawal Notice, wherein the Agency

mistakenly stated that MVP's accreditation had been terminated

(as of October 20, 2009). In fact, MVP's accreditation remained

valid until at least October 27, 2009, on which date The Joint

Commission issued a letter to Mr. Gomez that provided as

follows:

The Joint Commission was notified that MVP

Health, Inc. closed effective 6/19/2009 and

that your organizations [sic ] license was

surrendered to the state on 8/13/2009.

In order to complete the process of removing

the organization, MVP Health, Inc., and all

of its services from our records, please

return to the Joint Commission the

Certificate of Accreditation, since the

certificate and all copies remain the

property of The Joint Commission. We will

update our records accordingly.

The parties stipulated that, as of the final hearing in this

case, MVP was not accredited by The Joint Commission or any

other accrediting organization. As will be discussed below,

Section 400.471(2)(h), Florida Statutes, provides unambiguously

that a home health agency must maintain accreditation to

maintain licensure.

17. Mr. Gomez believes, based on conversations he has had

with The Joint Commission, that The Joint Commission would

reinstate MVP's accreditation, without the need for MVP to

reapply for accreditation, if AHCA were to indicate that MVP

will be licensed. While Mr. Gomez's testimony in this regard is

not a legally sufficient basis upon which to find that The Joint

Commission is, in fact, prepared to reinstate MVP's

accreditation, Mr. Gomez's credibly articulated belief

nevertheless persuades the undersigned to find that the

possibility of such reinstatement exists, should a clear path to

MVP's licensure emerge.

18. The posture of this case is such that the question at

hand is not whether MVP's application should be denied for

failure to maintain accreditation, as the Agency urges; the

question is whether MVP's application should be withdrawn from

further consideration as incomplete. The answer to that

question is clearly no because, as will be seen, the law

prohibits an agency from denying an application for licensure

for failure to correct an error or omission or to supply

additional information unless the agency notified the applicant

of the error, omission, or need for additional information

within 30 days after receiving the application. In this case,

the Agency did not notify MVP that there was any issue regarding

MVP's accreditation until long after this statutory deadline had

passed. Indeed, MVP was still accredited 30 days after

submitting its application, and the company remained accredited

for more than three months after that.

19. It is determined as a matter of ultimate fact that,

with regard to Item #2 in the Withdrawal Notice, MVP's

application was complete as of June 11, 2009.

20. The upshot of the foregoing findings of fact is that,

as a matter of ultimate fact, AHCA had received from MVP a

completed application for licensure as a home health agency no

later than July 24, 2009.

CONCLUSIONS OF LAW

21. The Division of Administrative Hearings has personal

and subject matter jurisdiction in this proceeding pursuant to

Sections 120.569 and 120.57(1), Florida Statutes (2009).

22. The general procedure for licensing is set forth in

Section 120.60, Florida Statutes, which provides in pertinent

part as follows:

(1) Upon receipt of an application for a

license, an agency shall examine the

application and, within 30 days after such

receipt, notify the applicant of any

apparent errors or omissions and request any

additional information the agency is

permitted by law to require. An agency

shall not deny a license for failure to

correct an error or omission or to supply

additional information unless the agency

timely notified the applicant within this

30-day period. An application shall be

considered complete upon receipt of all

requested information and correction of any

error or omission for which the applicant

was timely notified or when the time for

such notification has expired. Every

application for a license shall be approved

or denied within 90 days after receipt of a

completed application unless a shorter

period of time for agency action is provided

by law. The 90-day time period shall be

tolled by the initiation of a proceeding

under ss. 120.569 and 120.57. Any

application for a license that is not

approved or denied within the 90-day or

shorter time period, within 15 days after

conclusion of a public hearing held on the

application, or within 45 days after a

recommended order is submitted to the agency

and the parties, whichever action and

timeframe is latest and applicable, is

considered approved unless the recommended

order recommends that the agency deny the

license. Subject to the satisfactory

completion of an examination if required as

a prerequisite to licensure, any license

that is considered approved shall be issued

and may include such reasonable conditions

as are authorized by law. Any applicant for

licensure seeking to claim licensure by

default under this subsection shall notify

the agency clerk of the licensing agency, in

writing, of the intent to rely upon the

default license provision of this

subsection, and shall not take any action

based upon the default license until after

receipt of such notice by the agency clerk.

23. Section 408.806, Florida Statutes, prescribes the

particular process applicable to applications for licensure as a

home health agency, and it includes the following relevant

provisions:

(1) An application for licensure must be

made to the agency on forms furnished by the

agency, submitted under oath, and

accompanied by the appropriate fee in order

to be accepted and considered timely. The

application must contain information

required by authorizing statutes and

applicable rules and must include:

(a) The name, address, and social security

number of:

* * *

4. Each controlling interest if the

applicant or controlling interest is an

individual.

(b) The name, address, and federal employer

identification number or taxpayer

identification number of the applicant and

each controlling interest if the applicant

or controlling interest is not an

individual.

* * *

(3)(a) Upon receipt of an application for a

license, the agency shall examine the

application and, within 30 days after

receipt, notify the applicant in writing of

any apparent errors or omissions and request

any additional information required.

(b) Requested information omitted from an

application for licensure, license renewal,

or change of ownership, other than an

inspection, must be filed with the agency

within 21 days after the agency's request

for omitted information or the application

shall be deemed incomplete and shall be

withdrawn from further consideration and the

fees shall be forfeited.

(c) Within 60 days after the receipt of a

complete application, the agency shall

approve or deny the application.

24. In connection with the requirements for disclosure of

a corporate applicant's "controlling interests," 5 Florida

Administrative Code Rule 59A-8.004 provides as follows:

(2) The applicant shall identify its legal

name, its business name, and the names and

addresses of corporate officers and

directors, the name and address of each

person having at least a 5% equity interest

in the entity and other information as

required in Section 408.806(1), F.S. For

initial and change of ownership applications

and corporate name changes, a current

certificate of status or authorization

pursuant to Chapter 607, F.S., is required.

25. As discussed in the findings of fact above, the Agency

apparently suspected, based on the fact that a lawsuit was

pending in which certain individuals had challenged Mr. Gomez's

claim to be MVP's sole owner, that MVP's application contained

false, misleading, or incomplete information concerning its

ownership. Although it appears that MVP did disclose truthfully

to AHCA the existence of the lawsuit involving Mr. Gomez,

neither the applicable statute nor rule requires the applicant

to disclose information about ongoing litigation that might

cause a redistribution of a corporate applicant's equity. 6 More

important and to the point, however, is that AHCA has cited no

provision of law, and the undersigned has not independently

discovered such a legal requirement, compelling a corporate

applicant to provide, or authorizing the Agency to demand, on

pain of denial, "proof of ownership" in the form of

"documentation that the legal issues of ownership . . . have

been finally resolved." 7

26. AHCA was not, in short, "permitted by law to require"

MVP to provide such proof of ownership as a condition of

completing MVP's application. Thus, it is concluded that MVP

was not required, in order to make a complete application, to

comply with AHCA's request for extra information, which request

MVP could not possibly have satisfied, in any event, because (as

the Agency apparently knew) the lawsuit had not been "finally

resolved" as of October 20, 2009, when it sent the Withdrawal

Notice, and indeed the litigation was still in process as of the

final hearing in this case.

27. As found above, MVP provided AHCA with all of the

information about its ownership and officers that it was

required to submit in accordance with the requirements of

Section 408.806(1), Florida Statutes, and Florida Administrative

Code Rule 59A-8.004(2). As a matter of fact and law, MVP's

application was complete with regard to this disclosure

requirement no later than July 24, 2009.

28. The status of MVP's accreditation raises a dilemma.

First, accreditation "must be maintained by the home health

agency to maintain licensure." § 400.471(2)(h), Fla. Stat.

Second, as of the final hearing, MVP was no longer accredited,

although it had been until the end of the (pre-litigation)

application process. MVP contends that, if AHCA had not

mistakenly deemed MVP's application incomplete, but rather had

acted in a timely fashion to issue MVP a license, MVP would not

have lost its accreditation. MVP urges that, as a result, MVP

should be given a reasonable time within which to secure the

reinstatement of its accreditation, before its completed

application is approved or denied.

29. The Agency argues that MVP's lack of accreditation is

a trump because without accreditation, MVP is not qualified for

licensure as a home health agency. Although the Agency concedes

no error or delay in processing MVP's application, the logic of

its position is that a mistake on the Agency's part would be

irrelevant inasmuch as the facts as they exist right now are

determinative, regardless of how the present situation

developed, or of what was or might have been.

30. The flaw in the Agency's logic is that the Agency did

not deny (it its view) a completed application. It expressly

withdrew from further consideration (and effectively denied) an

application deemed to be incomplete. Doing so was the

culmination of a series of mistakes.

31. To begin, the law unambiguously prohibits an agency

from "deny[ing] a license for failure to correct an error or

omission or to supply additional information unless the agency

timely notified the applicant" of the particular deficiency

within 30 days after receiving the application. See

§ 120.60(1), Fla. Stat. The Agency failed to give MVP timely

notice, within this 30-day period, that MVP needed to correct an

error or omission, or supply additional information, regarding

its accreditation. Thus, AHCA was not legally permitted to use

the issue of MVP's accreditation as a basis for deeming MVP's

application incomplete.

32. Next, the Agency drew the wrong factual conclusion

about the completeness of MVP's application. As set forth

above, MVP's application was complete, as a matter of fact, no

later than July 24, 2009. By then, MVP had provided all of the

information about its owner and officers, and their (lack of)

ownership interests in other health care facilities, that MVP

was legally required to provide——and indeed, had provided all of

the information on these matters (for which it was asked) that

it could have provided. MVP's application was complete, as

well, in regard to the issue of accreditation, for MVP had

submitted, with its application, documentation showing that MVP

was accredited.

33. Having misperceived the actual status of MVP's

application, which was in fact a completed application, the

Agency took its eyes off the clock, which had begun to run no

later than July 24, 2009, counting down the time remaining for

making a decision as to whether to grant or deny MVP's

application. The law, as mentioned above, requires that

"[e]very application for a license shall be approved or denied

within 90 days after receipt of a completed application unless a

shorter period of time for agency action is provided by law." §

120.60(1), Fla. Stat. In this case, a shorter period of time,

namely 60 days, is provided by law. See § 408.806(3)(c), Fla.

Stat. Thus, the Agency had until September 22, 2009, at the

latest, to approve or deny MVP's application. It blew the

deadline. 8

34. Section 120.60(1), Florida Statutes, specifies the

consequence of an agency's failure timely to approve or deny a

completed application: "Any application for a license that is

not approved or denied within the 90-day or shorter time period

. . . is considered approved[.]" 9 Because AHCA did not approve

or deny MVP's application within 60 days after receiving a

completed application, the application must be considered

approved. See Lanier v. Turlington , 488 So. 2d 612, 614 (Fla.

1st DCA 1986)(statutory prescription for agency's untimely

action on application for licensure is that the application

shall be deemed approved subject to the satisfactory completion

of all outstanding prerequisites).

35. The undersigned is of course aware that AHCA believed

it had not received a completed application and hence would not

have thought that the 60-day period had commenced. Nothing in

Section 120.60(1), Florida Statutes, suggests, however, that the

90-day or shorter period does not commence until the agency

declares the application complete. The statute says that an

"application shall be considered complete upon receipt of all

requested information 10 and correction of any error or omission

for which the applicant was timely notified or when the time for

such notification has expired." § 120.60(1), Fla. Stat.

(emphasis added). The date upon which an agency was in receipt

of all legally required elements of an application is an

historical fact. If the agency never received all of the

required elements, that too is a matter of historical fact. The

question of whether a particular "application shall be

considered complete," therefore, is ultimately a factual one, as

is the question of when the application was completed, in cases

where it is considered complete. If, for whatever reason, the

agency misapprehended the historical events as they unfolded,

its subjective understanding cannot alter or override the

objective reality. 11 The facts, after all, are the facts. Here,

MVP's application was complete as of July 24, 2009, regardless

of whether the Agency knew that fact. Consequently, the 60-day

period began on that date, regardless of whether the Agency

noticed. 12

36. Although MVP's application is considered approved,

MVP's lack of accreditation creates the dilemma alluded to

above, which is that issuing a license to an applicant who

clearly fails to meet a condition of eligibility seems aberrant.

Fortunately, Section 120.60(1) provides a way out of the

apparent predicament.

37. The court in Lanier v. Turlington , 488 So. 2d 612

(Fla. 1st DCA 1986), confronted this situation. The case arose

from the Commissioner of Education's denial of a teacher's

application for certification as a "master teacher" based on her

failure to include a social security number in the application.

Id. at 613. As it happened, the Commissioner had not notified

the applicant of this omission within the 30-day period

prescribed in Section 120.60(2), Florida Statutes (1985), an

earlier version of today's Section 120.60(1), nor had he denied

the application within the 90-day period, as required. Due to

the Commissioner's delay, the applicant had been unable to take

a qualifying test, the successful completion of which was a

condition of eligibility for certification. Id. Thus, the

applicant was not fully qualified for certification, although

she would have been (assuming she had passed the test), had the

Commissioner not improperly denied her application due to an

omission for which timely notice had not been given.

38. On the subject of remedies available to this

applicant, the court stated as follows:

Although appellant asks that the appellee

Commissioner be directed to "grant a make-

whole remedy awarding the designation of

Associate Master teacher to the Petitioner,"

we conclude, under the terms of section

120.60(2), supra, the lack of timely notice

by appellee results only in appellee being

unable to deny certification based on the

cited omission from the application.

Appellant should therefore be permitted to

pursue certification as if her application

had been complete. Certain time constraints

for examination and for other requirements

for certification will obviously have been

mooted by the intervening appeal. The

prescription of section 120.50(2) [sic ] in

these circumstances appears to be that the

application shall be "deemed approved . . .

subject to the satisfactory completion" of

the required examination and other

prerequisites, which would necessarily

relate back to the period for which the

application is "deemed approved" by the

terms of the statute.

Id. at 614.

39. Section 120.60(1), Florida Statutes, provides that,

"[s]ubject to the satisfactory completion of an examination if

required as a prerequisite to licensure, any license that is

considered approved shall be issued and may include such

reasonable conditions as are authorized by law." This mandate

is similar to the "prescription of section 120.[6]0(2)," which

the court in Lanier implemented in directing the Commissioner to

issue the applicant a conditional license. The undersigned

concludes that the appropriate remedy here, as in Lanier , is the

issuance of a license, based on an application which is

"considered approved" by operation of law, subject to the

condition that the licensee satisfactorily fulfill the remaining

prerequisite to licensure, which in this case entails the

reinstatement of MVP's accreditation. Once MVP's accreditation

is reinstated (assuming it is), the satisfactory completion of

this requirement will relate back to the period for which MVP's

application is "considered approved" by the terms of the

statute. See Lanier , 488 So. 2d at 614.

40. As a final point of discussion, the undersigned

observes that the outcome would be practically the same even if,

for whatever reason, MVP's application were not "considered

approved." In that event, based on the facts that (a) MVP's

application was complete as of July 24, 2009, and (b) the Agency

failed timely to notify MVP concerning any problems with its

accreditation (of which there weren't any, either within 30 days

after AHCA's receipt of MVP's application, or as of the date of

the Withdrawal Notice), the undersigned would recommend that

AHCA either grant or deny MVP's completed application within 45

days after the issuance of this Recommended Order. See §

120.60(1), Fla. Stat. MVP would then have a period of time,

perhaps of many months' duration, 13 in which to secure the

reinstatement of its accreditation, which time period would

probably be sufficient for doing so——assuming that, as Mr. Gomez

testified, The Joint Commission is prepared to reinstate MVP's

accreditation once it appears MVP is on track to be licensed. 14

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 which, first, acknowledges

that MVP's application for licensure as a home health agency is

considered approved by the terms of Section 120.60(1), Florida

Statutes; and, second , directs the Agency Clerk to issue MVP a

conditional license, which shall be subject to MVP's (a)

providing satisfactory proof of accreditation upon such

reasonable conditions as the Agency may prescribe, and (b)

meeting such additional reasonable conditions, if any, as AHCA

is authorized by law to impose.

DONE AND ENTERED this 22nd day of April, 2010, in

Tallahassee, Leon County, Florida.

JOHN G. VAN LANINGHAM

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone] SUNCOM 278-9675

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 22nd day of April, 2010.

ENDNOTES

1 / Although the evidence does not conclusively eliminate the

possibility that, sometime prior to October 20, 2009, AHCA had

verbally notified MVP of its intent to deem MVP's application

incomplete, the testimony presented, coupled with the facts to

which the parties stipulated, which comprise a chronology of the

operative events, combine to make this possibility extremely

remote——so unlikely, in fact, that the undersigned reasonably

infers, and hereby finds, based on a preponderance of the

evidence, that the Withdrawal Notice constituted the first

notice given to MVP that AHCA intended not to issue MVP a

license.

2 / See § 408.815(1)(a), Fla. Stat.

3 / See Fla. Admin. Code R. 59A-8.0086(1)(a)(application shall be

denied for failure to "to submit all the information required in

the application within 21 days of being notified").

4 / To be clear, the fact that an application is complete does

not mean that it must be approved. Although this point might

seem self-evident, the parties in this case have tended, to one

degree or another, to conflate the issue of completeness with

that of eligibility. For example, the Agency seems to believe

that the existence of a lawsuit concerning MVP's ownership

provides a basis to deny MVP's application for licensure,

apparently on the theory that the litigation shows Mr. Gomez is

not the "clear" owner of 100 percent of MVP's shares, contrary

to the representation in MVP's application that he is . Assuming

the Agency had reason to doubt the veracity of the statements

made in MVP's application concerning its ownership, the Agency

could have given notice of its intent to deny the application on

that basis, which would have provided MVP a clear point of entry

to seek an administrative determination of whether, in fact, Mr.

Gomez is or is not MVP's sole shareholder. That is not,

however, what the Agency did, which is why the question here is

not whether, in fact, Mr. Gomez is the sole shareholder of MVP,

but instead whether MVP's application was complete in regard to

disclosures concerning ownership.

5 / The term "controlling interest" is defined as follows:

(7) "Controlling interest" means:

(a) The applicant or licensee;

(b) A person or entity that serves as an

officer of, is on the board of directors of,

or has a 5-percent or greater ownership

interest in the applicant or licensee; or

(c) A person or entity that serves as an

officer of, is on the board of directors of,

or has a 5-percent or greater ownership

interest in the management company or other

entity, related or unrelated, with which the

applicant or licensee contracts to manage

the provider.

The term does not include a voluntary board

member.

§ 408.803(7), Fla. Stat.

6 / It is not necessary to decide whether AHCA is permitted by

law to require the submission of information regarding a pending

lawsuit that might affect a corporate applicant's ownership

because AHCA (a) requested only to be assured that the lawsuit

was over, which it was not; and (b) has never asserted, and did

not attempt to prove at hearing, that MVP failed timely to

provide, upon request, available information about the lawsuit,

which necessarily would not include documentation showing the

final disposition, as the suit was ongoing.

7 / AHCA was not looking merely for additional "proof of

ownership," which would have been superfluous. MVP had

submitted statutorily sufficient proof of ownership in its

application, stating under oath that Mr. Gomez owned all of the

company's shares. What AHCA wanted was proof of undisputed

ownership, where "undisputed" meant "not presently the subject

of an unresolved lawsuit." AHCA's demand for such proof

reflects an intention to impose an eligibility criterion

(absence of pending litigation over ownership) that is nowhere

to be found in the licensing statute. AHCA is not permitted to

create new qualifications for licensure except via rulemaking——

and then only to the extent it has been delegated such

legislative authority.

8 / The Withdrawal Notice, recall, was dated October 20, 2009,

and no timely verbal notice had been given. Cf. Department of

Transp. v. Calusa Trace Dev. Corp. , 571 So. 2d 543, 546 (Fla. 2d

DCA 1990)(verbal denial is sufficient to satisfy the time

limitations of § 120.60); accord , Sumner v. Dep't of Prof'l

Regulation , 555 So. 2d 919 (Fla. 1st DCA 1990).

9 / There are circumstances in which the 90-day or shorter period

may be extended. One involves litigation: the "90-day time

period shall be tolled by the initiation of a proceeding under

ss. 120.569 and 120.57." § 120.60(1), Fla. Stat. In such

event, the agency has until "45 days after a recommended order

is submitted to the agency and the parties" to approve or deny

the application; if the agency fails timely to act, the

application is "considered approved unless the recommended order

recommends that the agency deny the license." Id. Another such

circumstance arises when a "public hearing is held on the

application," in which case the agency must approve or deny the

application within 15 days after the conclusion of the public

hearing, if that deadline is beyond the 90-day period, or else

the application will be considered approved. Id.

Neither of these situations has occurred here. There was

not a "public hearing" on MVP's application in the sense that

the term is used in the statute (and if there were the 15-day

period would have expired). And while MVP obviously initiated a

proceeding under §§ 120.569 and 120.57 (this one), the

proceeding began after the 60-day period had run. Logically, a

time period that has expired cannot thereafter be tolled by a

subsequent event; there is nothing still moving to stop from

running. The upshot is that the Agency had the 60-day period in

which to grant or deny MVP's application, no more.

10 / In this context, the set of "all requested information" must

either be a subset of, or coterminous with, the universe of

information that "the agency is permitted by law to require," as

the first sentence of § 120.60(1), Fla. Stat., makes clear.

This is because, obviously, an agency should not request

information that it is not permitted by law to demand as

essential to the completion of the application. If, however,

the agency does that which it should not do, and calls for, as a

condition of an application's completion, the provision of

information it has no warrant to demand, then the applicant's

failure or inability to comply with the unauthorized request for

extra information should not be found to prevent the application

from being considered complete, for allowing an agency to

benefit (or an applicant to suffer) in consequence of the

agency's ultra vires act, besides being patently unfair, would

give agencies an incentive to impose such unauthorized

requirements, or at least would remove a disincentive to doing

so. It should be added, though, that when an applicant fails or

refuses to comply with an agency's request for additional

information, the applicant necessarily takes a chance that the

request will later be found legitimate, with the result that the

applicant's application will properly be deemed incomplete, or

alternatively that the agency will nevertheless consider the

application complete but then deny it on the merits, forcing the

applicant to initiate an administrative proceeding during which

the previously requested information might well be discoverable

and relevant as evidence at hearing. As a practical matter,

applicants should probably comply with requests for information

that are not outlandish and at least reasonably likely to result

in the submission of information relevant to the statutory

conditions for licensure. In this case, MVP did the best it

could to satisfy the Agency's requests for information. The

problem for MVP was that AHCA had requested information that did

not exist.

11 / This case provides a good example of why this must be so.

Although the evidence here shows that the Agency sincerely, but

mistakenly, believed that MVP's application was incomplete,

suppose for argument's sake, hypothetically, that AHCA instead

realized, too late, that it had missed the deadline for granting

or approving MVP's application in accordance with §

408.806(2)(c), Fla. Stat. If an agency, faced with this

situation, were allowed to circumvent the decision deadline by

the expedient of rejecting the application as incomplete, its

notice to the applicant would probably look a lot like the

Withdrawal Notice, from which it appears, actually, that the

Agency had all of the information it needed to deny the

application based on the legal dispute concerning MVP's

ownership and MVP's lack of accreditation. The point is that if

an agency were permitted to avoid the 90-day or shorter decision

period simply by preventing its commencement through the

stratagem of deeming an application incomplete, this "exception"

would engulf the rule requiring that applications be granted or

denied within 90 (or fewer) days after receipt of a complete

application: a clever agency could always frame the grounds for

denial in terms of the application's "incompleteness."

12 / The lesson here is that an agency which believes an

application is fatally incomplete should always notify the

applicant of that determination within the 90-day or shorter

period. That way, if the application were later found in a

substantial-interests proceeding to have been complete, the

application would not be considered approved (because the 90-day

or shorter period would have been tolled by the administrative

litigation), and the agency would have up to 45 days after the

issuance of the recommended order within which to grant or deny

the application. On the other hand, when an agency delays

announcing its intent to withdraw from consideration an

application deemed incomplete, thinking the decision period has

not yet commenced, and waits to act for more than 90 days (or

fewer if the period is shorter) after receiving what is, or

seems reasonably likely to be, the applicant's final submission,

the agency runs the risk of being found to have missed the

deadline, if the application is later determined, in a § 120.57

proceeding, to have been complete. While there may be good

reasons for taking such a chance, delay——even if ultimately

vindicated (where, for example, the application is later found

to have been incomplete, as the agency believed)——seems to be

contrary to the spirit of § 120.60(1), Fla. Stat., which favors

reasonably prompt action on applications for licensure.

13 / If the Agency denied the application, MVP would be entitled

to request a § 120.57 hearing. If that were to happen, MVP

would have, as a practical matter, at least until the final

hearing to obtain its accreditation. This is because the

dispute would be heard de novo , and the administrative law judge

would be able to receive and consider evidence of the relevant

extant conditions, including, for example, the recent

reinstatement of accreditation, were that to occur. See

McDonald v. Department of Banking and Finance , 346 So. 2d 569,

584 (Fla. 1st DCA 1977). As the court explained in McDonald ,

The hearing officer's decision to

permit evidence of circumstances as they

existed at the time of the hearing was

correct. The agency may appropriately

control the number and frequency of

amendments to licensing applications and may

by rule prevent substantial amendment of the

application in midproceeding. But the

hearing officer or agency head conducting

Section 120.57 proceedings should freely

consider relevant evidence of changing

economic conditions and other current

circumstances external to the application.

Section 120.57 proceedings are intended to

formulate final agency action, not to review

action taken earlier and preliminarily.

Id. at 584 (footnote omitted).

14 / In the Withdrawal Notice, the Agency asserted that MVP

needed to have secured accreditation no later than October 8,

2009, which was 120 after the Agency's receipt of MVP's

application. If this were true, MVP would be out of time. The

Agency's position was based on § 400.471(2)(h), Fla. Stat.,

which provides in relevant part as follows:

In the case of an application for initial

licensure, [the applicant must file either]

documentation of accreditation, or an

application for accreditation, from an

accrediting organization that is recognized

by the agency as having standards comparable

to those required by this part and part II

of chapter 408. Notwithstanding s. 408.806,

an applicant that has applied for

accreditation must provide proof of

accreditation that is not conditional or

provisional within 120 days after the date

of the agency's receipt of the application

for licensure or the application shall be

withdrawn from further consideration. Such

accreditation must be maintained by the home

health agency to maintain licensure.

(Emphasis added.)

MVP was fully accredited when it submitted its application

to AHCA, and, accordingly, pursuant to § 400.471(2)(h), MVP

filed documentation showing that it possessed valid

accreditation, thereby fulfilling the statutory requirement.

Under the plain and unambiguous language of the statute, the

obligation to file with AHCA a copy of the applicant's

application for accreditation arises only in cases where the

applicant is not yet accredited and thus must apply for

accreditation. It is likewise clear, based on the plain

language of the statute, that the only applicants who "must

provide proof of accreditation that is not conditional or

provisional within 120 days after the date of the agency's

receipt of the application for licensure" are those who, at the

time of applying for licensure, are awaiting accreditation. MVP

was not in that group. MVP therefore was not subject to the

120-day limitation period. To the extent AHCA contended

otherwise, it did so based on a misreading of an unambiguous

statute that, in this regard, requires no interpretation. MVP,

in short, is not out of time to obtain accreditation by virtue

of § 400.471(2)(h), Fla. Stat.

COPIES FURNISHED :

Jay Adams, Esquire

Broad and Cassel

Post Office Box 11300

Tallahassee, Florida 32302

D. Carlton Enfinger, II, Esquire

Michael J. Hardy, Esquire

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop No. 3

Tallahassee, Florida 32308

Richard J. Shoop, Agency Clerk

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop No. 3

Tallahassee, Florida 32308

Justin Senior, General Counsel

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop No. 3

Tallahassee, Florida 32308

Thomas W. Arnold, Secretary

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop No. 3

Tallahassee, Florida 32308

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the final order in this case.