17-003902CON Shands Teaching Hospital And Clinics, Inc., D/B/A Uf Health Shands Rehab Hospital vs. Agency For Health Care Administration Status: Closed Settled and/or Dismissed prior to entry of RO/FO on Monday, August 21, 2017.

SHANDS TEACHING HOSPITAL AND

CLINICS, INC., d/b/a UF HEALTH

SHANDS REHAB HOSPITAL,

Petitioner, DOAH CASE NO.: 17-3902CON

AHCA CASE NO.: 2017007463

v. CON NO.: 10480

STATE OF FLORIDA, AGENCY FOR

HEALTH CARE ADMINISTRATION,

Respondent.

I

FINAL ORDER

THIS CAUSE is before the State of Florida, Agency for Health Care Administration ("the

Agency") concerning the approval of Shands Teaching Hospital And Clinics, Inc., d/b/a UF Health

Shands Rehab Hospital ("UF Health") Certificate of Need ("CON") Application No. 10480 to

establish a 40-bed replacement comprehensive medical rehabilitation ("CMR") hospital in District

3, Alachua County. The Agency being fully advised in the premises finds as follows:

1. The Agency approved UF Health's CON Application No. 10480 to establish a 40-

bed replacement comprehensive medical rehabilitation hospital in District 3, Alachua County.

2. UF Health's CON Application No. 10480 was reviewed at the same time as other

applications seeking to establish new CMR units at existing hospitals. Marion Community

Hospital, Inc. d/b/a West Marion Community Hospital and Ocala Regional Medical Center

("Marion Community") filed CON No. 10477 to establish a 30-bed CMR unit. Munroe HMA

Hospital, LLC d/b/a Timberidge Hospital ("Munroe") filed CON No. 10478 to establish a 16-bed

CMR unit and CON No. 10478P, a partial request for a 10-bed CMR unit. North Florida Regional

Medical Center, Inc. d/b/a North Florida Regional Medical Center ("North Florida Regional") filed

CON No. 10479 to establish a 20-bed CMR unit.

3. The Agency denied CON Nos. 10477, 10478, 1 0478P and 10479.

4. On June 23, 2017, Munroe filed a petition challenging the Agency's approval of

UF Health's Application, and challenging the denial of its CON Application No. 10478 and

10478P.

5. On June 27, 2017, North Florida Regional filed a petition challenging the Agency's

approval of UF Health's CON Application No. 10480 and challenging the denial of its CON

Application No. 10479.

6. On June 27, 2017, Marion Community filed a petition challenging the Agency's

approval of UF Health's CON Application No. 10480, and challenging the denial of its CON

Application No. 10477.

7. UF Health filed a Petition to challenge any and all other co-batched applications,

pursuant to Rule 59C-1.012, Florida Administrative Code. This petition filed by UF Health seeks

that the Division of Administrative Hearings uphold the Agency's preliminary approval of UF

Health's CON Application No. 10480, and uphold the denials of CON Application No. 10477, No.

10478, No. 10478P and No. 10479.

8. The Agency assigned the following CON numbers to applications at issue in this

proceeding and rendered decision with regard to the beds sought as follows:

CON #10480 Applicant UF Health Amount of Beds 40 Approved

CON #10477 Applicant Ocala Regional Amount ofBeds 30 Denied

CON #10478 Applicant Munroe Amount of Beds 16 Denied

CON #10479 Applicant North Florida Regional Amount of Beds 20 Denied

9. In Volume 43, Number 13, of the Florida Administrative Register, dated January

20, 2017, the Agency announced a need for zero (0) additional comprehensive medical

rehabilitation beds in District 3, which consists of Alachua, Bradford, Citrus, Columbia, Dixie,

Gilchrist Hamilton, Hernando, Lafayette, Lake, Levy, Marion, Putnam, Sumter, Suwannee and

Union counties. See Rule 59C-1.039(5)(a)- (c), Fla. Admin. Code.

10. UF Health filed CON Application No. 10480 to establish a replacement 40-bed

replacement comprehensive medical rehabilitation hospital. UF Health did not seek to add any

CMR beds through its application. UF Health's proposed replacement comprehensive medical

rehabilitation hospital does not increase the number of comprehensive medical rehabilitation beds

in District 3.

11. Each of the denied applicants filed applications to establish new comprehensive

medical rehabilitation beds that would result in an increase in the number of comprehensive

medical rehabilitation beds in District 3. Each argued that "special circumstances" justified the

approval of their respective proposals, despite the absence of any predicted need, using the

Agency's well-established methodology. See Fla. Admin. CodeR. 59C-1.039(3)(d), (5)(e).

12. On July 3, 2017, the Agency published notice of the litigation initiated by the

denied applicants. See Fla. Admin. Reg., Vol. 43, No. 128 (July 3, 2017). Pursuant to Rule 59C-

1.012(2)(a), Florida Administrative Code, the Agency's notice invited approved applicants, like

UF Health, to file a petition in order to place competing applicants' denied applications at issue.

Rule 59C-1.012(2)(a) provides a 1 0-day deadline to file any such petition.

13. The petitions filed by the denied applicants requested the denial of UF Health's

preliminarily approved CON Application No. 10480.

14. The petitions were forwarded to the Division of Administrative Hearings and later

consolidated for hearing.

15. On August 18, 2017, the following parties filed the following pleadings: North

Florida Regional Medical Center, Inc., filed a Notice of Voluntary Dismissal; Munroe Regional

Medical Center, filed a Notice of Voluntary Dismissal; Marion Community Hospital, Inc., d/b/a

West Marion Community Hospital; and Ocala Regional Medical Center, filed a Notice of

Voluntary Dismissal.

16. As a result of the filing of each respective Notice of Voluntary Dismissal there is

not a challenge pending as to the preliminarily approved UF Health's Certificate ofNeed ("CON")

Application No. 10480 to establish a 40-bed replacement comprehensive rehabilitation hospital in

District 3, Alachua County. In addition, the challenging parties have dismissed their requests for

approval of a certificate of need program.

It is therefore ORDERED:

1. The Agency's approval of UF Health's CON No. 10480 to establish a 40-bed

replacement comprehensive medical rehabilitation hospital in District 3, Alachua County, is

UPHELD and CON Application No. 10480 shall be issued to UF Health.

2. The Agency's denials of CON No. 10477, CON No. 10478 and CON No. 10479

are UPHELD.

ORDERED in Tallahassee, Florida, on this __fl_ day of '2017.

f1"r: Justin . Senior, Secreta

Agency For Health Care

NOTICE OF RIGHT TO JUDICIAL REVIEW

A party who is adversely affected by this Final Order is entitled to judicial review, which shall be

instituted by filing the original Notice of Appeal with the Agency Clerk of AHCA, and a copy

along with the filing fee prescribed by law with the District Court of Appeal in the appellate district

where the Agency maintains its headquarters or where a party resides. Review of proceedings

shall be conducted in accordance with the Florida appellate rules. The Notice of Appeal must be

filed within 30 days of the rendition of the order to be reviewed.

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true and correct copy of the foregoing Final Order has been

furnished by the method designated to the persons named below on this z'h;of

,2017.

Richard J. Shoop, Agenc

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop #3

Tallahassee, Florida 32308

[phone]

R. Bruce McKibben

Administrative Law Judge

Division of Administrative Hearings

(Electronic Filing)

Stephen A. Ecenia, Esquire

Craig D. Miller, Esquire

J. Stephen Menton, Esquire

Tana Storey, Esquire

Rutledge Ecenia, P .A.

119 South Monroe Street, Suite 202

Tallahassee, Florida 32301

[e-mail]

[e-mail]

[e-mail]

[e-mail]

[e-mail]

[e-mail]

Attorneys for North Florida Regional Medical Center, Inc. and West Marion Community

Hospital and Ocala Regional Medical Center

(Electronic Mail)

Geoffrey D. Smith, Esquire

Susan C. Smith, Esquire

Sabrina B. Dieguez, Esquire

Smith & Associates

3301 Thomasville Road, Suite 201

Tallahassee, Florida 32308

[e-mail]

[e-mail]

[e-mail]

[e-mail]

[e-mail]

Attorneys for Munroe Regional Medical Center

(Electronic Mail)

Seann M. Frazier, Esquire

Marc Ito, Esquire

Suite 750,215 South Monroe Street,

Tallahassee, Florida 32301

sfrazi er@phrd. com

[e-mail]

[e-mail]

Attorneys for UF Health Shands Rehab Hospital

(Electronic Mail)

Jon a than L. Rue

Suite 3600, 303 Peachtree Street Northeast

Atlanta, GA 30308

[e-mail]

[e-mail]

Attorney for UF Health Shands Rehab Hospital

(Electronic Mail)

Richard Joseph Saliba, Senior Attorney

Lindsey L. Miller-Hailey, Assistant General Counsel

Office of the General Counsel

Agency for Health Care Administration

(Electronic Mail)

JaniceK. Mills, Government Analyst II

Facilities Intake Unit

Agency for Health Care Administration

(Electronic Mail)

Marisol M. Fitch, Unit Manager

Certificate of Need Unit

Agency for Health Care Administration

(Electronic Mail)

Jack Plagge, Unit Manager

Hospital and Outpatient Services Unit

Agency for Health Care Administration

(Electronic Mail)