05-001246RP David Mckalip, M.D. vs. Agency For Health Care Administration Status: Closed DOAH Final Order on Monday, September 26, 2005.

Summary: Petitioner did not have standing to challenge proposed rules which required hospitals to report surgical infection preventative measures.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DAVID MCKALIP, M.D., )

)

Petitioner, )

)

vs. ) Case No. 05 - 1246RP

)

AGENCY FOR HEALTH CARE )

ADMINISTRATION, )

)

Respondent. )

)

FINAL ORDER

Pursu ant to notice, a final hearing was held in this case

on May 20 and June 8, 2005, in St. Petersburg, Florida, before

Susan B. Harrell, a designated Administrative Law Judge of the

Division of Administrative Hearings.

APPEARANCES

For Petitioner: David, Mc Kalip, M.D., pro se

1201 5th Avenue, North

Suite 210

St. Petersburg, Florida 33705

For Respondent: Tom Barnhart, Esquire

Office of the Attorney General

The Capitol, Pla za Level 01

Tallahassee, Florida 32399

STATEMENT OF THE ISSUE

Whether proposed r ules 59B - 15.001 through 59B - 15.007 are an

invalid exercise of delegated legislative authority.

PRELIMINARY STATEMENT

On April 5, 2005, Petitioner, Davi d McKalip, M.D.

(Dr. McKalip), filed a Petition to Determine the Invalidity of

Proposed Rules, challenging p roposed r ules 59B - 15.001 through

59B - 15.007 (Proposed Rules) of Respondent, Agency for Health

Care Administration (Agency) , as an invalid exercise o f

delegated legislative authority. The final hearing was

originally scheduled for May 13, 2005.

On April 22, 2005, Dr. McKalip filed Petitioner's Motion to

Amend Petition. On April 29, 2005, Dr. McKalip filed

Petitioner's Second Motion to Amend Petition and Petitioner's

Third Motion to Amend Petition. Dr. McKalip filed a Request for

Continuance on May 2, 2005. By order dated May 5, 2005, the

motions to amend the petition were granted, and Dr. McKalip was

given leave to file an amended petition on or bef ore May 13,

2005. Dr. McKalip filed an Amended Petition to Determine the

Invalidity of Proposed Rules on May 10, 2005. By order dated

May 5, 2005, the motion to continue was granted, and the final

hearing was rescheduled for May 20, 2005.

On May 17, 2005 , Dr. McKalip filed another request to amend

the petition, which was granted by order dated May 19, 2005.

The final hearing was commenced on May 20, 2005, but was

not concluded on that date. The final hearing was reconvened on

June 8, 2005, and concluded on that date. At the final hearing,

Dr. McKalip testified in his own behalf and called the following

witnesses: Dr. Mark Michelman, Dr. Clinton Holder, Dr. Teresa

A. Bradley, Kim Streit, Carolyn Turner, and Lisa Rawlins.

Petitioner's Exhibits 1 through 32, 34 through 37, and 39

through 41 were admitted in evidence. Petitioner proffered the

hospital policies of Northside Hospital. At the final hearing,

the Agency called the following witnesses: Dr. Mark Michelman,

Lisa Rawlins, and Carolyn Turner. Res pondent's Exhibits 1

through 5 were admitted in evidence.

On May 11, 2005, Petitioner filed Petitioner's Request for

Official Recognition. The request was granted at the final

hearing and official recognition was taken of the documents set

forth in the re quest for official recognition. At the final

hearing , official recognition was also taken of Sections 408.05,

408.061, and 381.026, Florida Statutes (2004) 1 ; House Bill 1629

of the 2004 session ; "State Library Archives of Florida

Rulemaking Under Chapter 120," revised February 2005;

Subsections 120.54(3)(a), 215.92(4), 815.03(8), 408.07(13) and

408.15(4), Florida Statutes ; and Florida Administrative Code

Rule 59A - 3.254 .

FINDINGS OF FACT

1. The State Center for Health Statistics (State Center)

within the Agency collects and disseminates data from hospitals

and ambulatory surgery centers. One of the responsibilities of

the State Center is to produce comparable and uniform health

information and statistics through a Comprehensive Health

Information System. § 408.05(3), Fla. Stat. The State

Comprehensive Health Information System Advisory Council (CHIS)

is established within the Agency to assist the State Center in

reviewing the Comprehensive Health Information System and to

recommend improvements for the s ystem. § 408.05(8), Fla. Stat.

In conjunction with CHIS, the agency is to develop and implement

a long - range plan for making available performance outcome and

financial data that will allow consumers to compare health

services. § 408.05(3)(l), Fla. Stat .

2. In 2004, Section 408.061, Florida Statutes, was amended

to require health care facilities to submit hospital emergency

department data, data on hospital - acquired infections as

specified by rule , and data on readmissions as specified by

rule.

3. On October 20, 2004, a meeting of CHIS was held, and a

discussion was held on the collection and dissemination of data

relating to infection rates. A motion was approved to consider

the adoption of Surgical Infection Prevention (SIP) measures and

to form a Technical Workgroup for Hospital Acquired Infections

(Technical Workgroup) to make recommendations to the Agency on

how to report SIP measures, to review the current systems of

reporting infection rates , and to determine the appropriate

infection measu res to report.

4. On December 1, 2004, CHIS met and heard recommendations

from the Technical Workgroup concerning the collection and

reporting of SIP measures. The recommendations included

developing draft rules. The agency assigned Carolyn Turner, a

Go vernment Analyst II with the Agency, to draft rules relating

to the collection of SIP M easures . Ms. Turner began drafting

the rules in December 2004. Ms. Turner drafted the Proposed

Rules.

5 . On January 13, 2005, the Agency held a rule development

works hop, which had been noticed in the Florida Administrative

Weekly on December 30, 2004. During the workshop and subsequent

to the workshop, the Agency received comments and suggestions

for modifications to the Proposed Rules, and, as a result, the

Agency m ade some changes to the Proposed Rules. The Proposed

Rules were published in the Florida Administrative Weekly on

March 11, 2005, and a public hearing was held on the Proposed

Rules on April 4, 2005.

6 . The Proposed Rules provide:

59B - 15.001 Purp ose

The rules in this section describe the

requirements for reporting Surgical

Infection Prevention (SIP) Measures to the

Agency for Health Care Administration

(Agency) for the purpose of providing

comparative information to consumers.

59B - 15.002 Def initions

(1) "Hospital" means an entity that is

licensed per Section 395.002(13), Florida

Statutes.

(2) "Reporting period" means a calendar

quarter.

(3) "Eligible patient" means a selected

surgical patient 18 years of age or older

with no prior evidence of infection as

specified by the Center for Medicare and

Medicaid Services (CMS) in the

Specifications Manual for National Hospital

Quality Measures available on the CMS

website at:

www.cms.hhs.gov/quality/hospital.

59B - 15.003 Exclusions

(1) State - operated hospitals.

(2) Psychiatric hospitals with no

licensed acute care beds other than licensed

psychiatric or substance abuse beds.

(3) Specialty rehabilitation as defined

in subparagraph 59A - 3.52(1)(c)2. F.A.C.

(4) Intensive Re sidential Treatment

Programs for Children and Adolescents as

defined in paragraph 59A - 3.252(1)(d), F.A.C.

59B - 15.004 Reporting Requirements

(1) Hospitals shall report Surgical

Infection Prevention (SIP) Measures to the

Agency for Health Care Admin istration

(Agency) quarterly due on or before

December 1, 2005 for the period April 1,

through June 30, 2005. Thereafter, data

shall be reported for each calendar quarter

due 150 days following the end of the

quarter.

(2) Hospitals shall report the fo llowing

measures for all eligible patients

regardless of type of payer.

(a) Prophylactic antibiotics received

within 1 hour prior to surgical incision;

(b) Prophylactic antibiotic selection

for surgical patients;

(c) Prophylactic antibiotics

di scontinued within 24 hours after surgery

end time.

(3) The methodology used to prepare the

measures shall meet the standards specified

by the Centers for Medicare and Medicaid

Services (CMS) in the Specifications Manual

for National Hospital Quality Me asures

available on the CMS website at:

www.cms.hhs.gov/quality/hospital. CMS

standards include submission of SIP data to

the Quality Improvement Organization

Clinical Warehouse, providing records

required for reabstraction activities, and

compliance wit h other data quality standards

as specified by CMS.

(4) Hospitals shall use the SIP

methodology specified by the CMS for the

applicable reporting period to determine the

SIP measures reported to the Agency. If the

hospital uses sampling, the hospital must

follow the sampling protocol specified by

CMS.

(5) Hospitals shall report the

population size, rate numerator value, and

denominator value as specified by CMS for

each type of surgery to include coronary

artery bypass surgery (CABG), cardiac

surge ry, hip arthroplasty, knee

arthroplasty, colon surgery, hysterectomy,

vascular surgery, and for all of the above

surgeries overall.

(6) Hospitals shall report data

separately for each location consistent with

Rule 59E - 7.012, F.A.C. unless reporting

sep arately would be contrary to CMS

specifications. If a combined report is

submitted, report the name of the hospital

and AHCA hospital identification number

required in subsection 59B - 15.005(1), F.A.C.

for each of the hospitals included in the

report.

( 7) The data shall be submitted in a

text file, using a tab between each data

element. Start a new line for each type of

surgery and for each measure. Order the

rows of data by type of surgery as listed in

subsection (5) with three consecutive rows

of da ta for each measure in subsection (2)

above reported for each type of surgery.

Each line of data shall state the name of

the type of surgery or state all of the

above surgeries overall as in subsection (5)

above and state the name of the type of

surgery o r state all of the above surgeries

overall as in subsection (5) above and state

the name of the type of measure as in (2)

above. The rate shall be reported as a

decimal number greater than or equal to zero

(0) and less than or equal to one hundred

(100) u sing the format X.XX, XX.XX, or

XXX.XX as required. Report hospital contact

information required in Rule 59B - 15.005,

F.A.C. in the order specified starting a new

line beginning with contact name and contact

telephone number. Hospital contact

information should be reported at the

beginning of the document.

(8) Hospitals shall send the SIP

measures by electronic mail to

[e-mail] or, if

requested in writing by the hospital and

approved by the Agency to the Agency's

mailing address usi ng a 3.5" diskette or CD -

ROM. The mailing address of the Agency is:

Agency for Health Care Administration, 2727

Mahan Drive, Mail Stop #16, Tallahassee,

Florida 32308 with the statement,

"Attention: State Center for Health

Statistics." If the hospital has a vendor

send the SIP measures to the Agency, the

hospital will direct the vendor to copy (cc)

the hospital contact when the report is e -

mailed to the Agency.

59B - 15.005 Hospital Contact Information.

(1) Each hospital shall include the

followin g contact information when

submitting a report required in this section

to the Agency for Health Care

Administration:

(a) Name of hospital;

(b) AHCA hospital identification number;

(c) Reporting year in four digits;

(d) Reporting quarter as a 1, 2, 3 , or 4

where 1 corresponds to the first quarter of

a calendar year;

(e) Contact name;

(f) Contact title;

(g) Contact address;

(h) Contact direct telephone number;

(i) Hospital telephone number;

(j) Contact e - mail address;

(k) Contact FAX number.

(2) The hospital contact information

shall be reported in a text file as

described in Rule 59B - 15.004, F.A.C., using

a tab between each data element.

59B - 15.006 Certification

(1) Each hospital shall provide

certific ation of the accuracy of the

Surgical Infection Prevention M easures

including all data required in this section

as provided in Section 408.061(1)(a),

Florida Statutes.

(2) The certification shall be submitted

to the Agency for Health Care Administratio n

(Agency) using the Certification of Surgical

Infection Prevention Measures from SIP - 1,

dated 2/01/2005, incorporated by reference.

The certification shall be submitted to the

Agency for Health Care Administration

(Agency) quarterly prior to or concurre nt

with the submission of the Surgical

Infection Prevention Measures as provided in

Rule 59B - 15.004, F.A.C. The Certification

of Surgical Infections Prevention Measures

Form will be available from the Agency

website at www.ahca.myflorida.com. The

signed Certification of Surgical Infections

Prevention Measures may be submitted

electronically to

[e-mail]. using a pdf

file with a scanned signature or mailed to

the Agency address provided in Rule 59B -

15.004, F.A.C.

(3) If a combined re port is submitted

per subsection 59B - 15.004(6), F.A.C., a

separate Certification of Surgical Infection

Prevention Measures Form SIP - 1 must be

submitted for each hospital included in the

report.

59B - 15.007 Administrative Penalties

Failure to report as required in this

section in whole or in part is subject to

administrative fines as provided in Section

408.08(2) and 408.08(5), Florida Statutes,

unless the hospital has been granted an

extension of up to 30 days by the Agency for

Health Care Administrati on for reasons of

extraordinary or hardship circumstances such

as a natural disaster or emergency event

impacting the hospital. Hospitals must

request the extension, in writing, prior to

the due date specified in Rule 59B - 15.004,

F.A.C.

7 . The Proposed Rules provide that the specific authority

for the promulgation of the Proposed Rules is Subsection

408.06(1)(a)2 . , Florida Statutes, and the law implemented by the

Proposed Rules is Subsection 408.05(3)( l ) 1 . , Florida Statutes.

8 . Dr. McKalip is a neurol ogical surgeon practicing in

St. Petersburg, Florida. He has hospital privileges at Bayfront

Medical Center (Bayfront) and St. Anthony's Health Care

(St. Anthony's). Both hospitals would be required by the

Proposed Rules to report SIP Measures to the Age ncy. SIP

Measures would be required to be reported only on the following

surgical categories: coronary artery bypass surgery, cardiac

surgery, hip arthroplasty, knee arthroplasty, colon surgery,

hysterectomy, and vascular surgery. Dr. McKalip performs

v ascular surgery of the brain, vascular bypass surgery in the

neck, and, as part of his board certification, is required to be

able to perform carotid artery surgery in the neck. These

procedures would be included under the category of vascular

surgery in the ICD - 9 codes as other (peripheral) vascular shunt

or bypass VASC SHUNT and BYPASS NEC. 2

9 . The Proposed Rules do not require Dr. McKalip to report

the use of SIP m easures; they require the hospitals in which he

performs the procedures to report the S IP m easures. The

Proposed Rules do not require the hospitals to implement SIP

m easures, merely to report whether the SIP m easures were

implemented. Some hospitals, including Bayfront and

St. Anthony's, have developed policies which require physicians

pra cticing in those hospitals to implement the SIP m easures.

10 . Data collection relating to SIP m easures is not a new

concept. The Centers for Medicare and Medicaid Services (CMS)

have developed a methodology to collect data on SIP m easures,

and some hos pitals are currently voluntarily reporting the use

of SIP m easures for certain surgical procedures. The Proposed

Rules adopt the methodology developed by CMS.

11 . The Proposed Rules are supported by the Florida

Hospital Association ; Florida Medical Quali ty Assurance, Inc. ;

and CMS. The use of SIP measures is supported by many medical

societies and organizations.

1 2 . The Agency views the collection of the SIP measures as

the first step in a three - step process for collecting and

reporting hospital - acquire d infection data. The second step

will involve the collection of infection rates that are acquired

in the inpatient setting, and the third step will involve

reporting the infection rates by physicians.

CONCLUSIONS OF LAW

1 3 . The Division of Administrati ve Hearings has

jurisdiction over the parties to and the subject matter of this

proceeding. § 120.56(2), Fla. Stat.

1 4 . Subsection 120.56(2)(a), Florida Statutes, provides:

(a) Any substantially affected person may

seek an administrative determination o f the

invalidity of an proposed rule by filing a

petition seeking such a determination with

the [Division of Administrative Hearings] .

. . . The petition shall state with

particularity the objections to the proposed

rule and the reasons that the proposed rule

is an invalid exercise of delegated

legislative authority. The petitioner has

the burden of going forward. The agency

then has the burden to prove by a

preponderance of the evidence that the

proposed rule is not an invalid exercise of

delegated leg islative authority as to the

objections raised.

1 5 . In Ward v. Board of Trustees of the Internal Trust

Fund , 651 So. 2d 1236, 1237 - 1238 (Fla. 4th DCA 1995), the court

set forth the test to be used in determining whether the

petitioner in a rule challenge is substantially affected,

stating:

In order to meet the substantially affected

test of section 120.54(4), the petitioner

must establish: (1) a real and sufficiently

immediate injury in fact; and (2) "that the

alleged interest is arguably within the zone

of interest to be protected or regulated."

See All Risk Corp. of Fla. v . State, Dep't

of Labor & Employment Sec. , 412 So. 2d (Fla.

1st DCA 1982). . . . To satisfy the

sufficiently real and immediate injury in

fact element, the injury must not be based

o n pure speculation or conjecture. See,

e.g., Professional Firefighters of Fla.,

Inc. v. Department of Health &

Rehabilitative Servs. , 396 So. 2d 1194 (Fla.

1st DCA 1981). A real and sufficiently

immediate injury in fact has been recognized

where the chal lenged rule or its

promulgating statute has a direct and

immediate effect upon one's right to earn a

living. The clearest example of this is

where the challenged rule directly regulates

the challenger's occupational field per se

by, for example, setting c riteria to engage

in that profession. See, e.g., Coalition of

Mental Health Professions v. Department of

Professional Regulations , 546 So. 2d 27

(Fla. 1st DCA 1989); Professional

Firefighters , 396 So. 2d at 1196.

However, even where a challenged rule or i ts

promulgating statute does not regulate the

challenger's profession per se by, for

example, setting criteria to engage in that

profession, but the rule has the effect of

directly regulating the professional conduct

of persons within such occupation, such

challenger has been found to be

substantially affected. See State, Dep't of

Health & Rehabilitative Servs. v. Alice P. ,

367 So. 2d 1045, 152 n. 2 (Fla. 1st DCA

1979). . . . The general rule regarding the

zone of interest element of the

substantially affe cted test is that such

element is met where a party asserts that a

statute, or a rule implementing such

statute, encroaches upon an interest

protected by a statute or the constitution.

Florida Medical Ass'n v. Department of

Professional Regulation , 426 So . 2d 1112,

1117 (Fla. 1st DCA 1983). In the context of

a rule challenge, the protected zone of

interest need not be found in the enabling

statute of the challenged rule, itself. Id.

"Since the crux of [a rule change]

controversy involves the claim that [the

enabling statute] does not authorize the

rule, it is obvious the effect of other

statutes must be considered in determining

standing." Id.

1 6 . Dr. McKalip argues that because the hospitals are

requiring the physicians to implement the SIP m easur es that will

be required to be reported , he is substantially affected by the

Proposed Rules. If the Proposed Rules required the hospitals to

implement the SIP measures, Dr. McKalip's argument might have

merit; however, the Proposed Rules do not require th e hospitals

to implement the SIP measures, merely to report them. Hospitals

are not required by the Proposed Rules to develop policies

requiring the physicians with privileges in the hospitals to use

the SIP m easures. The hospitals' policies on the imple mentation

of the SIP m easures are voluntary. There is no requirement in

the Proposed Rules that substantially affect Dr. McKalip per se

or indirectly through the regulation of hospitals; thus, Dr.

McKalip does not have standing to challenge the Proposed R ules.

1 7 . Even arguendo if Dr. McKalip had standing to challenge

the Proposed Rules, the Proposed Rules are not an invalid

exercise of delegated legislative authority. Subsection

120.52(8), Florida Statutes, defines invalid exercise of

delegated legislat ive authority as "action which goes beyond the

powers, functions, and duties delegated by the Legislature."

Dr. McKalip claims that the Proposed Rules are invalid based on

the following grounds set forth in Subsection 120.52(8), Florida

Statutes:

(a) The agency has materially failed to

follow the applicable rulemaking procedures

or requirements set forth in this chapter;

(b) The agency has exceeded its grant of

rulemaking authority, citation to which is

required by s.120.54(3)(a)1;

(c) The rule enlarges , modifies, or

contravenes the specific provisions of law

implemented, citation to which is required

by s. 120.54(3)(a)1;

* * *

(e) The rule is arbitrary or capricious. A

rule is arbitrary if it is not supported by

logic or the necessary facts; a rule is

capricious if it is adopted without thought

or reason or is irrational[.]

1 8 . Dr. McKalip alleged that the Agency materially failed

to follow rulemaking requirements set forth in Chapter 120,

Florida Statutes, but in his Amended Petition to Determine th e

Invalidity of Proposed Rules, he did not point to any specific

requirements of Chapter 120 that were not followed. 3 Dr. McKalip

did argue that the advisory panel , which made recommendations to

the Agency concerning the reporting of the SIP Measures , did not

have consumers or physicians on the panel, and, therefore, the

rulemaking was flawed. Whether consumers and physicians were

involved in making recommendations to the Agency is immaterial

to the rulemaking requirements set forth in Chapter 120, Florid a

Statutes. CHIS may make recommendations to the Agency, but the

ultimate responsibility for rulemaking rests with the Agency.

Additionally, any failure by the A gency to allow input from

consumers and physicians was cured by the rule development

workgrou p and the public hearing which the Agency held on the

Proposed Rules.

1 9 . Dr. McKalip alleged that the Proposed Rules exceeded

the Agency's grant of rulemaking authority. The law, which the

Proposed Rules cite as specific authority , is Subsection

408.061 (1)(a) , (2), Florida Statutes, which provides:

(1) The agency shall require the submission

by health care facilities, health care

providers, and health insurers of data

necessary to carry out the agency's duties.

Specification for data to be collected u nder

this section shall be developed by the

agency with the assistance of technical

advisory panels including representatives of

affected entities, consumers, purchasers,

and such other interested parties as may be

determined by the agency.

(a) Data submi tted by health care

facilities, including the facilities as

defined in chapter 395, shall include, but

are not limited to: case - mix data, patient

admission and discharge data, hospital

emergency department data which shall

include the number of patients tr eated in

the emergency department of a licensed

hospital reported by patient acuity level,

data on hospital - acquired infections as

specified by rule, data on complications as

specified by rule, data on readmissions as

specified by rule, with patient and

pr ovider - specific identifiers included,

actual charge data by diagnostic groups,

financial data, accounting data, operating

expenses, expenses incurred for rendering

services to patients who cannot or do not

pay, interest charges, depreciation expenses

based on the useful life of the property and

equipment involved, and demographic data.

The agency shall adopt nationally recognized

risk adjustment methodologies or software

consistent with the standards of the Agency

for Healthcare Research and Quality and as

selected by the agency for all data

submitted as required by this section. Data

may be obtained from documents such as, but

not limited to: leases, contracts, debt

instruments, itemized patient bills, medical

record abstracts, and related diagnostic

inf ormation. Reported data elements shall

be reported electronically in accordance

with rule 59E - 7.012, Florida Administrative

Code. Data submitted shall be certified by

the chief executive officer or an

appropriate and duly authorized

representative or emp loyee of the licensed

facility that the information submitted is

true and accurate.

* * *

(2) The Agency shall, by rule, after

consulting with appropriate professional and

governmental advisory bodies and holding

public hearings and considering existi ng and

proposed systems of accounting and reporting

utilized by health care facilities, specify

a uniform system of financial reporting for

each type of facility based on a uniform

chart of accounts developed after

considering accepted accounting principle s.

Such systems shall, to the extent feasible,

use existing accounting systems and shall

minimize the paperwork required of

facilities. This provision shall not be

construed to authorize the agency to require

health care facilities to adopt a uniform

acc ounting system. As a part of such

uniform system of financial reporting, the

agency may require the filing of any

information relating to the cost to the

provider and the charge to the consumer of

any service provided in such facility,

except the cost of a physician's services

which is billed independently of the

facility.

20 . Dr. McKalip argues that the Agency does not have

authority to require reporting of the SIP m easures, because the

SIP m easures are not data on hospital - acquired infections. The

Age ncy has the authority to collect data which are necessary to

carry out the Agency's duties. One of the Agency's duties is to

"establish a comprehensive health information system to provide

for the collection, compilation, coordination, analysis,

indexing, dissemination, and utilization of both purposefully

collected and extant health - related data and statistics."

§ 408.05(1), Fla. Stat. The term "data" is not defined in

Chapter 408, Florida Statutes. 4 Webster's II New Riverside

University Dictionary (19 88) defines "data" as "Information,

esp. information organized for analysis or used as the basis for

decision - making." Data is a very broad term. Subsection

408.061(1) , Florida Statutes , provides a list of specific types

of data that may be collected, bu t the list is not inclusive.

Subsection 408.061(1), Florida Statutes, provides that data

submitted by hospitals "shall include, but not be limited to"

specific types of data.

21 . Reading Subsections 408.05(1) and 408.061(1), Florida

Statutes, in pari m ateria , it is clear that the information

collected must be health - related and necessary to carry out the

Agency's duties. Data on the SIP m easures is health - related and

will be used in the establishment of a comprehensive health

information system, which Subsection 408.05(2)(j), Florida

Statutes, requires to include data on the quality of care

provided by various health care providers. Additionally, the

reporting of the SIP m easures is a step in the implementation of

a "long - range plan for making availabl e performance outcome and

financial data that will allow consumers to compare health care

service" as required by Subsection 408.05(3)(l)1 . , Florida

Statutes. It should be noted that Subsection 408.061(1)(e),

Florida Statutes, provides that "[a] requireme nt to submit data

shall be adopted by rule if the submission of data is being

required of all members of any type of health care facility,

health care provider, or health insurer."

22 . The evidence established that the Agency has not

exceeded its grant of rulemaking authority in the promulgation

of the Proposed Rules.

2 3 . Dr. McKalip alleged that the Proposed Rules enlarge,

modify, or contravene the law implemented , Subsection

408.05(3)(l)1 . , Florida Statutes, which provides:

(3) COMPREHENSIVE HEALTH INFORMATION

SYSTEM. -- In order to produce comparable and

uniform health information and statistics,

the agency shall perform the following

functions:

* * *

(l) Develop, in conjunction with the State

Comprehensive Health Information System

Advisory Cou ncil, and implement a long - range

plan for making available performance

outcome and financial data that will allow

consumers to compare health care services.

The performance outcomes and financial data

the agency must make available shall

include, but is n ot limited to,

pharmaceuticals, physician s , health care

facilities, and health plans and managed

care entities. The agency shall submit the

initial plan to the Governor, the President

of the Senate, and the Speaker of the Hous e

of Representatives by March 1, 2005, and

shall update the plan and report on the

status of its implementation annually

thereafter. The agency shall also make the

plan and status report available to the

public on its internet website. As part of

the plan, the agency shall identify the

process and timeframes for implementation,

any barriers to implementation, and

recommendations of changes in the law that

may be enacted by the Legislature to

eliminate the barriers. As preliminary

elements of the plan, the agency shall:

1. Make avai lable performance outcome and

patient charge data collected from health

care facilities pursuant to s. 408.061(1)(a)

and (2). The agency shall determine which

conditions and procedures, performance

outcomes, and patient charge data to

disclose based upon input from the council.

When determining which conditions and

procedures are to be disclosed, the council

and the agency shall consider variation in

costs, variation in outcomes, and magnitude

of variations and other relevant

information. When determinin g which

performance outcomes to disclose, the

agency:

a. Shall consider such factors, as volume

of cases: average patient charges; average

length of stay; complication rates,

mortality rates; and infection rates, among

others, which shall be adjusted for case mix

and severity, if applicable.

b. May consider such additional measures

that are adopted by the Centers for Medicare

and Medicaid studies, National Quality

Forum, the Joint Commission on Accreditation

of Healthcare Organizations, the Agency for

He althcare Research and Quality, or a

similar national entity that establishes

standards to measure the performance of

health care providers of other states.

When determining which patient charge data

to disclose, the agency shall consider such

measures as a verage charge, average net

revenue per adjusted patient day, average

cost per adjusted patient day, and average

cost per admission, among others.

2 4 . Dr. McKalip argues that Proposed Rules do not require

the collection of performance outcomes. Subsectio n

408.05(3)(l)1.b., Florida Statutes, provides that in determining

which performance outcome measures to disclose, the Agency may

consider additional measures of performance adopted by CMS,

which is what the Agency did. It considered the SIP m easures in

c ollecting data that would be disclosed to consumers so that

they would be able to compare health care services. The

collection of data on the SIP m easures is the first step in

Agency's collecting and reporting of hospital - acquired

infections.

2 5 . Dr. Mc Kalip argued in his Proposed Final Order that

the data on the SIP m easures was not risk adjusted as required

by Subsection 408.061(1)(a), Florida Statutes. This objection

was not raised in the Amended Petition to Determine the

Invalidity of Proposed Rules . Pursuant to Subsection 120.56(2),

Florida Statutes, the petition is required to raise the

objections to proposed rules with specificity; therefore, the

risk - adjustment objection will not be considered.

2 6 . Dr. McKalip contends that the Proposed Rule s are

arbitrary and capricious. The Proposed Rules are neither

arbitrary nor capricious. The Proposed Rules are logical and

are supported by facts. Scientific studies support the use of

the SIP measures as a means of combating surgical infections.

Some hospitals are currently voluntarily reporting the SIP

m easures to CMS. The Agency gave thought to reporting the SIP

m easures and considered comments from the public and from CHIS

in developing the Proposed Rules.

ORDER

Based on the foregoing Findings of Fact and Conclusions of

Law, it is

ORDERED that Petitioner lacks standing to challenge the

Proposed Rules , the Proposed Rules are a valid exercise of

delegated legislative authority and the Amended Petition to

Determine the Invalidity of Proposed Rules i s hereby DISMISSED.

DONE AND ORDERED this 2 6th day of September , 2005 , in

Tallahassee, Leon County, Florida.

S

SUSAN B. HARRELL

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apala chee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675 SUNCOM 278 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 2 6th day of September, 2005 .

ENDNOTES

1/ Unless otherwise indicated, all references to the Florida

Statutes are to the 2004 version.

2/ Proposed Rule 59B - 15.004(3) provides that the methodology

used to prepare the measures shall meet the standards of the CMS

specified on the CMS website. The current version o f the

standards requires that discharges from July 1, 2005, through

September 30, 2005, be reported using the "Specifications Manual

for National Hospital Quality Measures, Version 1.02. Version

1.02 includes other (peripheral) vascular shunt or bypass VA SC

SHUNT and BYPASS NEC in the list of procedures under vascular

surgery.

3/ Dr. McKalip did argue in his Proposed Final Order that the

Agency's submission to the Joint Administrative Procedure

Committee lacked detail sufficient to justify the Proposed

R ules, but that was not included in the Amended Petition to

Determine the Invalidity of Proposed Rules as an objection.

Subsection 120.56(2)(a), Florida Statutes, requires that the

objections to proposed rules be stated with particularity in the

petition; thus, the objection based on the submission to the

Joint Administrative Procedure Committee should not be

considered. Even if the objection were considered, it is

without merit. The submission accurately describes the Proposed

Rules.

4 / The term "audit ed actual data" is defined in Subsection

408.07(7), Florida Statutes, but this refers to information

contained within financial statements which are examined by a

Florida - licensed certified public accountant.

COPIES FURNISHED :

David McKalip, M.D .

1201 5 th Avenue , North

Suite 210

St. Petersburg, Florida 33705

Tom Barnhart, Esquire

Office of the Attorney General

The Capitol, Plaza Level 01

Tallahassee, Florida 32399

Richard Shoop, Agency Clerk

Agency for Health Care Administration

2727 Mahan Drive, Mai l Station 3

Tallahassee, Florida 32308

William Roberts, Acting General Counsel

Agency for Health Care Administration

Fort Knox Building, Suite 3431

2727 Mahan Drive

Tallahassee, Florida 32308

Scott Boyd

Executive Director and General Counsel

Joint Admi nistrative Procedures Committee

120 Holland Building

Tallahassee, Florida 32399 - 1300

Liz Cloud, Program Administrator

Administrative Code

Department of State

R. A. Gray Building, Suite 101

Tallahassee, Florida 32399 - 0250

NOTICE OF RIGHT TO JUDICIAL R EVIEW

A party who is adversely affected by this Final Order is

entitled to judicial review pursuant to Section 120.68, Florida

Statutes. Review proceedings are governed by the Florida Rules

of Appellate Procedure. Such proceedings are commenced by

filin g the original Notice of Appeal with the agency clerk of

the Division of Administrative Hearings and a copy, accompanied

by filing fees prescribed by law, with the District Court of

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

the Appell ate District where the party resides. The notice of

appeal must be filed within 30 days of rendition of the order to

be reviewed.