07-003485CON Hca Health Services Of Florida, Inc., D/B/A St. Lucie Medical Center And Lawnwood Medical Center, Inc., D/B/A Lawnwood Regional Medical Center vs. Agency For Health Care Administration And Martin Memorial Medical Center, Inc. Status: Closed Recommended Order on Friday, July 31, 2009.

Summary: Applicant demonstrated a sufficient change in circumstances and public interest in the approval of its Certificate of Need application to construct an 80-bed hospital in the western portion of the county.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

HCA HEALTH SERVICES OF FLORIDA, )

INC., d/b/a ST. LUCIE MEDICAL )

CENTER and LAWNWOOD MEDICAL )

CENTER, INC., d/b/a LAWNWOOD )

REGIONAL MEDICAL CENTER, )

)

Petitioners, )

)

vs. ) Case No. 07-3485CON

)

AGENCY FOR HEALTH CARE )

ADMINISTRATION and MARTIN )

MEMORIAL MEDICAL CENTER, INC., )

)

Respondents. )

_______________________________ )

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative

Hearings, by its designated Administrative Law Judge, J.D.

Parrish, held a final hearing in the above-styled case on

November 3-7, 12-14, 17-21, and 25, 2008, in Tallahassee,

Florida.

APPEARANCES

For HCA Health Services of Florida, Inc., and Lawnwood

Medical Center, Inc.:

Stephen A. Ecenia, Esquire

J. Stephen Menton, Esquire

David Prescott, Esquire

Rutledge, Ecenia & Purnell, P.A.

215 South Monroe Street, Suite 420

Post Office Box 551

Tallahassee, Florida 32302

For Agency for Health Care Administration:

Karin M. Byrne, Esquire

Agency for Health Care Administration

2727 Mahan Drive

Building 3, Mail Station 3

Tallahassee, Florida 32308

For Martin Memorial Medical Center, Inc.:

Paul H. Amundsen, Esquire

Julie Smith, Esquire

Amundsen & Smith

502 East Park Avenue

Tallahassee, Florida 32301

and

Robert A. Weiss, Esquire

Karen A. Putnal, Esquire

Parker, Hudson, Rainer & Dobbs, LLP

The Perkins House, Suite 200

118 North Gadsden Street

Tallahassee, Florida 32301

STATEMENT OF THE ISSUE

Whether an application for a new hospital to be constructed

in Agency for Health Care Administration Planning District 9,

Subdistrict 2, should be approved.

PRELIMINARY STATEMENT

Petitioners, HCA Health Services of Florida, Inc., d/b/a

St. Lucie Medical Center and Lawnwood Medical Center, Inc.,

d/b/a Lawnwood Regional Medical Center (St. Lucie, Lawnwood or

Petitioners), have challenged the preliminary approval of

Certificate of Need (CON) Application No. 9981 (the

application). The application at issue was filed by the

Respondent, Martin Memorial Medical Center, Inc. (Martin or

Respondent) in the first batching cycle in 2007. Martin seeks

to construct a new acute care hospital in the western portion of

St. Lucie County (AHCA Planning District 9, Subdistrict 2). Its

CON application to do so was reviewed and preliminarily approved

by the Respondent, Agency for Health Care Administration (AHCA

or Agency). AHCA issued its State Agency Action Report (SAAR)

granting preliminary approval for the new hospital on June 13,

2007. The SAAR outlined AHCA's reasons and explanations for the

approval.

Section 408.039, Florida Statutes (2007), details the

review process by which this case is governed. The Florida

Legislature has directed AHCA to, by rule, provide for CON

applications to be submitted on a timetable or cycle basis.

Applications should be reviewed timely and applications

pertaining to similar types of services or facilities are to be

comparatively considered in relation to each other. In this

case, however, Martin Memorial is the sole competitor for the

facility sought. The approval of the CON application is opposed

by the Petitioners who are existing providers within the same

AHCA planning district. They timely filed petitions to oppose

the new hospital proposed by Martin.

The case was forwarded to the Division of Administrative

Hearings (DOAH) to conduct formal proceedings in connection with

the dispute. In accordance with the dates proposed by counsel

for the parties, the case was scheduled for hearing as stated

above.

All parties acknowledge that the applicable statutory

criteria applicable to this proceeding are found in Sections

408.031-408.045, Florida Statutes (2007). More specifically,

Section 408.035, Florida Statutes (2007) sets forth the CON

review criteria at issue in this proceeding.

With regard to those review criteria, the parties have

agreed:

a. Section 408.035(1), Florida Statutes

(2007): The need for the health care

facilities and health services being

proposed. This review criterion is

applicable and is disputed.

b. Section 408.035(2), Florida Statutes

(2007): The availability, quality of care,

accessibility, and extent of utilization of

existing health care facilities and health

services in the service district of the

applicant. This criterion is applicable.

The availability, accessibility, and extent

of utilization of existing health care

facilities and health services are in

dispute. The quality of care of the

existing providers is not in dispute,

however, the stipulation did not preclude

any party from presenting testimony and

evidence relating to access, including, but

not limited to, barriers to access, capacity

constraints, and delays in admissions.

c. Section 408.035(3), Florida Statutes

(2007): The ability of the applicant to

provide quality of care and the applicant's

record of providing quality of care. This

criterion is applicable but is not in

dispute.

d. Section 408.035(4), Florida Statutes

(2007): The availability of resources,

including health personnel, management

personnel, and funds for capital and

operating expenditures, for project

accomplishment and operation. This

criterion is applicable. In connection with

this criterion, the parties agree that the

number of clinical and nursing FTEs

identified by the application are reasonable

for the project and not disputed. The

reasonableness of the projected salaries for

the nurses shown on Schedule 6A of the

application remain in dispute.

e. Section 408.035(5), Florida Statutes

(2007): The extent to which the proposed

services will enhance access to health care

for residents of the service district. This

criterion is applicable and is in dispute.

f. Section 408.035(6), Florida Statutes

(2007): The immediate and long-term

financial feasibility of the proposal. This

criterion is applicable and is in dispute.

g. Section 408.035(7), Florida Statutes

(2007): The extent to which the proposal

will foster competition that promotes

quality and cost-effectiveness. This

criterion is applicable and is in dispute.

h. Section 408.035(8), Florida Statutes

(2007): The costs and methods of the

proposed construction, including the costs

and methods of energy provision and the

availability of alternative, less costly, or

more effective methods of construction.

This criterion is applicable. The parties

agree that the projected costs in the

application shown at Schedule 1, lines 1-3,

and 12-26 are reasonable and are not in

dispute. The remaining project costs are

disputed. Additionally, the Petitioners

claim that Martin's remote emergency

department approved for construction is an

available, alternative, less costly, and

more effective method of construction than

the construction of the proposed hospital.

Martin maintains that the CON criteria no

longer provide for comparison of the

proposed project with the outpatient

alternatives.

i. Section 408.035(9), Florida Statutes

(2007): The applicant's past and proposed

provision of health care services to

Medicaid patients and the medically

indigent. The parties agree this criterion

is applicable but is not disputed.

Nevertheless, they agreed any party could

provide testimony comparing the parties'

relative levels of service provided.

j. Section 408.035(10), Florida Statutes

(2007): The applicant's designation as a

Gold Seal Program nursing facility pursuant

to Section 400.235, Florida Statutes, when

the applicant is requesting additional

nursing home beds in that facility. This

criterion is not applicable to this case.

With regard to the rules applicable to this case, the

parties stipulated that the Agency rules applicable to this

proceeding are set forth in Florida Administrative Code Rules

59C-1.008(2)(e), 59C-1.008, and 59C-1.030(2).

With regard to Florida Administrative Code Rule 59C-

1.008(2)(e), the parties agreed that the following portion of

the rule is pertinent and applicable to this matter:

If an agency need methodology does not exist

for the proposed project:

1. The agency will provide to the

applicant, if one exists, any policy upon

which to determine need for the proposed

beds or service. The applicant is not

precluded from using other methodologies to

compare and contrast with the agency policy.

2. If no agency policy exists, the

applicant will be responsible for

demonstrating need through a needs

assessment methodology which must include,

at a minimum, consideration of the following

topics, except where they are inconsistent

with the applicable statutory or rule

criteria:

a. Population demographics and dynamics;

b. Availability, utilization and quality of

like services in the district, subdistrict

or both;

c. Medical treatment trends; and

d. Market conditions.

3. The existence of unmet need will not be

based solely on the absence of a health

service, health care facility, or beds in

the district, subdistrict, region or

proposed service area.

With regard to Florida Administrative Code Rule 59C-1.030(2),

the parties agreed that the following portion of the rule is

pertinent and applicable to this matter:

(a) The need that the population served or

to be served has for the health or hospice

services proposed to be offered or changed,

and the extent to which all residents of the

district, and in particular low income

persons, racial and ethnic minorities,

women, handicapped persons, other

underserved groups and the elderly, are

likely to have access to those services.

(b) The extent to which that need will be

met adequately under a proposed reduction,

elimination or relocation of a service,

under a proposed substantial change in

admissions policies or practices, or by

alternative arrangements, and the effect of

the proposed change on the ability of

members of medically underserved groups

which have traditionally experienced

difficulties in obtaining equal access to

health services to obtain needed health

care.

(c) The contribution of the proposed

service in meeting the health needs of

members of such medically underserved

groups, particularly those needs identified

in the applicable local health plan and

State health plan as deserving of priority.

(d) In determining the extent to which a

proposed service will be accessible, the

following will be considered:

1. The extent to which medically

underserved individuals currently use the

applicant's services, as a proportion of the

medically underserved population in the

applicant's proposed service area(s), the

extent to which medically underserved

individuals are expected to use the proposed

services, if approved;

2. The performance of the applicant in

meeting any applicable Federal regulations

requiring uncompensated care, community

service, or access by minorities and

handicapped persons to programs receiving

Federal financial assistance, including the

existence of any civil rights access

complaints against the applicant;

3. The extent to which Medicare, Medicaid

and medically indigent patients are served

by the applicant; and

4. The extent to which the applicant offers

a range of means by which a person will have

access to its services.

The parties have also stipulated that a timely and complete

letter of intent, CON application, and omissions response were

filed by Martin and processed by the Agency leading to a timely

preliminary recommendation of the Agency in compliance with

technical requirements, including those set forth in Section

Florida Statutes; Section 408.039(3)(a), Florida Statutes; and

Section 408.039(4)(b) and (c), Florida Statutes; that the

architectural schematics, project completion schedule, design

narratives, and code compliance information set forth in

Martin's CON application are reasonable; and that the petitions

filed in this cause were timely.

At the final hearing, Martin presented the testimony of the

following witnesses: Mark Robitaille, President and CEO of

Martin Memorial Health Systems, Inc., an expert in healthcare

administration; Patricia Tobin, Director of Planning for Core

Communities; Deborah Kolb-Collier, Ph.D., Senior Principal of

the Noblis Center for Health Innovation, an expert in Health

Care Planning and Finance; Peter M. Dayton, M.D., an expert in

obstetrics and gynecology; Joseph S. Gage, M.D., an expert in

internal medicine and cardiology; David Lee Hankin, J.D., CEO of

the Alfred E. Mann Foundation for Scientific Research, Angie

Metcalf, Corporate Director of Human Resources for Martin, an

expert in human resource management and compensation; Richard

Houghton, Ph.D., President of the Torrey Pines Institute for

Molecular Studies; Donald A. Carlson, Jr., Vice Chairman of the

B. C. Ziegler Company, an expert in health care investment

banking and finance; Armand E. Balsano, Principal with Ethos

Partners, an expert in health care finance and financial

feasibility; Robert J. Barry, D.O., an expert in internal

medicine; Nicholas Ianotti, M.D., an expert in medical oncology;

and Robert C. Pergolizzi, AICP, PTP, an expert in traffic and

travel time studies. Martin also presented the deposition

testimony of Ron Parrish, fire chief for the St. Lucie County

Fire District; Howard Robbins, M.D., the Chief Medical Officer

Vice-President for Martin Memorial Health Systems who is also

responsible for running Martin's medical group practice; Stanley

K. Smith, Ph.D., a professor at the University of Florida, who

serves as the Director of the Bureau of Economic and Business

Research responsible for producing population estimates for the

State of Florida; Jay Nelson, Ph.D., the director of the Vaccine

and Gene Therapy Institute at the Oregon Health and Sciences

University; Judy Smith, a resident of St. Lucie West and a

former patient of St. Lucie Medical Center; Stephen Pietrowski,

the chief administrator of Port St. Lucie Hospital, a 75-bed

acute psychiatric facility; Larry Pelton, President of the

Economic Development Council of St. Lucie County; Michael J.

Lannon, Superintendent of Schools for the St. Lucie County

School Board; Wesley McCurry, a developer who serves as Vice

President with Core Communities (Core) and as President of the

wholly owned subsidiary of Core, Tradition Development Company,

and a certified planner certified by the American Institute of

Certified Planners, American Planning Association; Jerry

Bentrott, an assistant city manager responsible for planning,

engineering, public works, parks and recreation, community

services, the building department, and capital projects for the

City of Port St. Lucie; Michelle Lee Berger, City Councilwoman

for District II, City of Port St. Lucie; Christopher Cooper,

City Councilman for District III, City of Port St. Lucie; Edward

L. Hengtgen, Jr., an architect who is a member of the American

Institute of Architects; Paul Matthew Baker, an expert in

building construction technology and acute care hospital

preconstruction costs employed as a preconstruction director for

Balfour Beatty Construction; John A. Kolosky, Executive Vice

President and CEO for the H. Lee Moffitt Cancer Center and

Research Institute in Tampa, Florida; William Frederick Heyd, an

expert in acute care hospital equipment planning who is an

architect for Gene Burton and Associates; Karen Kenny Ripper,

R.N., Chief Nursing Officer, Martin Memorial Health Systems, an

expert in hospital administration and nursing administration;

John Tagliareni, Vice-President Administrator and Chief

Strategic Planning Officer for Martin Memorial Health Systems

and Administrator for the 100-bed hospital operated on Salerno

Road known as Martin Memorial Hospital South; Michael Sonenblum,

M.D., pediatrician; William Carlson, M.D., a board-certified

orthopedic surgeon who is a member of the American Academy of

Orthopedic Surgeons; Peter Zeblisky, D.O., internist and

geriatrician; and Cynthia Pingolt, a registered respiratory

therapist who serves as assistant Vice President for

Professional Services, Martin Memorial Health Systems. Martin's

Exhibits 1-9, 11-32, 33A, 33B, 34, 34A, 35, 36, 37, 37A, 37B,

37C, 37F, 38, and 39 were admitted into evidence.

The Agency presented the testimony of Jeffrey N. Gregg,

Bureau Chief of Health Facility Regulation, who was accepted as

an expert in health planning and CON review. AHCA Exhibits 1

and 2 were received in evidence.

The Petitioners presented the testimony of Gary Cantrell,

the CEO of St. Lucie, an expert in health care administration;

Nancy Hilton, an expert in nursing, nurse administration, nurse

recruitment and staffing; David Mulholland, an expert in traffic

engineering, traffic and transportation planning and travel time

studies; Richard Baehr, an expert in health planning and health

finance; Rodney Smith, the CEO of Lawnwood, an expert in

hospital administration; Patrick McLaughlin, an expert in

strategic business planning, including analysis of market

conditions and the economic impact of those conditions; and

Daryl Weiner, an expert in health care planning, including

financial feasibility. The Petitioners' Exhibits 1-10, 12-18,

20, 28-30, 32, 39-42, 39A, 43A, 43B, 43C, 44-49, 51, 52, 54, 72,

75-79, and 83 were accepted into evidence.

The 20-volume Transcript of the final hearing was filed

with DOAH on December 24, 2008. By stipulation of the parties

the Proposed Recommended Orders were filed March 6, 2009.

Additionally, the parties' request to enlarge the page

limitation for the Proposed Recommended Orders was granted. All

parties timely filed Proposed Recommended Orders that have been

fully considered in the preparation of this Recommended Order.

FINDINGS OF FACT

The Parties

1. AHCA is the state agency charged with the

responsibility of administering the CON program for the state of

Florida. The Agency serves as the state heath planning entity.

See § 408.034, Fla. Stat. (2007). As such, it was charged to

review the CON application at issue in this proceeding. AHCA

has preliminarily approved Martin's CON application No. 9981.

2. The Petitioners are existing providers who oppose the

approval of the subject CON. St. Lucie is a 194-bed acute care

hospital located on U. S. Highway 1 in Port St. Lucie, Florida,

that opened in 1983. Included in the bed count are 17 obstetric

beds and 18 intensive care beds. St. Lucie utilizes 7 operating

rooms and provides a varied list of surgical services. Although

St. Lucie does not provide tertiary services, it offers an

impressive array of medical options including general and

vascular surgery, orthopedics, spine surgery, neurosurgery, and

gynecology. Furthermore, St. Lucie is a designated stroke

center and it is fully accredited by the Joint Commission on

Accreditation of Healthcare Organizations (JCAHO). The JCAHO

mission is to improve the safety and quality of care provided to

the public through the provision of health care accreditation

and related services that support performance improvement in

health care organizations.

3. St. Lucie uses a hospitalist program 7 days per week,

12 hours per day. The hospitalist program is a group of

physicians who are employed by the hospital to manage the care

of its patients. St. Lucie believes the hospitalist program

moves patient cases more quickly and efficiently. St. Lucie has

committed financial resources to its hospitalist program and

hopes to expand its use in the future.

4. The emergency department (ED) at St. Lucie handles

approximately 42,000 visits per year. The ED has 24 beds

comprised of 16 regular beds and 8 "fast track" beds. All areas

are either curtained or separated by dividers to provide for

patient privacy.

5. Historically, St. Lucie has expanded the ED to provide

for additional space for emergent patients. One of the

strategies it has used includes the installation of special

chairs in a waiting triaged area.

6. The other Petitioner, Lawnwood, is located in Ft.

Pierce, Florida, near I-95 and the Florida Turnpike. Lawnwood

has 341 beds and, in additional to traditional medical/surgical

options, provides tertiary services such as neurosurgery and

open heart. Lawnwood also provides Level II neonatal intensive

care services. Like St. Lucie, Lawnwood is fully accredited by

JCAHO. Lawnwood has provided quality health care services to

its region for over 30 years.

7. The Lawnwood ED handles approximately 40,000 visits per

year in a 28-bed unit.

8. At its current location Lawnwood can expand its

facilities should it desire to do so. At the current time,

however, it has no plans for expansion of its main campus. It

does plan to initiate an expansion of its intensive care unit.

Financing for that expansion was anticipated to become more

definite in 2009.

9. In furtherance of its efforts to promote itself as a

regional provider of quality medical services, Lawnwood has

begun the arduous process of becoming a Level I trauma program

for a multi-county area. In this regard, Lawnwood asserts that

its service area for trauma patients encompasses Indian River

County, St. Lucie County, parts of Okeechobee County, and

portions of Martin County, Florida. Lawnwood has invested in

the capital improvements needed to fully implement this program.

10. The Petitioners are owned and operated by Hospital

Corporation of America (HCA), a for-profit corporation

headquartered in Nashville, Tennessee. HCA has input into the

decisions affecting Petitioners and can influence when the

improvements they hope to implement will be finalized.

11. In addition to the Petitioners, other providers in the

district include Indian River Hospital located in Vero Beach,

Florida, and Martin Memorial Medical Center, Inc. with two

hospitals in Martin County, Florida. It is the latter

competitor that seeks to establish a new hospital in the western

portion of St. Lucie County, Florida.

12. Martin is a private, not-for-profit Florida

corporation licensed to operate Martin Memorial Hospital North,

in Stuart, Florida, and Martin Memorial Hospital South, in Port

Salerno, Florida. The northern facility has 244 licensed beds;

the southern hospital has 100 licensed beds. The northern

hospital is the older provider and has served patients from

St. Lucie and Martin Counties for over 70 years.

13. Like Lawnwood, Martin offers a broad range of acute

care hospital services including tertiary services. The options

available at Martin include open-heart surgery, complex wound

care, oncology, obstetrics, neonatal intensive care, pediatrics,

and orthopedics. Martin provides high-quality medical services

to its patients in both outpatient and inpatient venues. To

that end Martin has been active in the western portion of

St. Lucie County for a number of years and has solidified

relationships with physicians in that area of the district.

14. In this regard, Martin established an urgent care

center in Port St. Lucie back in 1984. Since that time it has

repeatedly sought to expand its provision of medical care to the

residents of St. Lucie County. Martin constructed a physicians

complex that employs and provides offices for physicians most of

whom are on staff at St. Lucie. Over 80 percent of the patients

from the Martin physician complex get admitted to St. Lucie.

15. Martin also established a second outpatient facility

in the western portion of St. Lucie County. This 70,000 square

foot center provides 500-600 treatments per month to its

patients. Among the services provided at this facility include

a broad range of diagnostic and laboratory services, radiation

therapy, rehabilitation therapy, and pediatric medicine.

16. Finally, Martin also intends to establish a

freestanding ED in the western portion of St. Lucie County in

2009. This facility will provide another access point for

patients in the western portion of the county to facilitate a

quicker response for patients who seek emergency care.

17. Martin views this proposed freestanding ED as an

interim measure and will convert it to an urgent care or other

non-acute use if the proposed hospital it seeks to construct is

approved.

The Proposal

18. Martin seeks to construct a general acute care

hospital consisting of 80 beds, with intensive care, an ED,

telemetry, and obstetrics. It will not offer tertiary services.

19. The site for the proposed hospital is in an area known

as "Tradition," a planned community in the western portion of

St. Lucie County. The City of Port St. Lucie has annexed the

geographical area into what residents consider "West Port St.

Lucie" and have designated an area of Tradition to promote the

life sciences industry.

20. Accordingly, Tradition has areas reserved for medical

office buildings, research facilities, as well as the hospital

site to be used by Martin. Martin's proposed site is adjacent

to the Torrey Pines Molecular Research Institute.

21. The entire Tradition and West Port St. Lucie area is

within AHCA's District 9, Subdistrict 2.

22. By locating the new hospital in the western portion of

the county, Martin maintains it will promote and enhance access

for current and future residents of the developing area without

adversely impacting St. Lucie and Lawnwood.

23. Another advantage to a hospital in the western portion

of the county is the option of having a haven in the event of a

hurricane or natural disaster in the eastern portion of the

county. Since the site is located to the west of the coastline,

storm surges would not likely impact the facility or dictate

evacuation. Further, the site provides excellent geographic

access for traffic and the population of the expanding western

portions of the county. Like other geographical areas, the

coastal portion of the county faces “build out” that will limit

the population expansion anticipated in that area. The proposed

area has yet to face any limitation in that regard. It is the

most likely geographic area that will expand as the population

grows.

24. HCA also recognized the benefits of the western area

for future expansion of its medical facilities. It

unsuccessfully negotiated to acquire a hospital site at or near

the proposed location.

25. In relation to the other parties, the proposed site is

north and west of the Martin hospitals in Martin County, west of

St. Lucie, and south and west of Lawnwood.

26. The size of the parcel is adequate to construct the

hospital.

27. In reaching its decision to seek the approval of the

new hospital, Martin considered input from many sources,

including, but not limited to: physicians who practice in the

vicinity of the proposed hospital; emergency response personnel

who transport patients to the various district hospitals;

medical researchers who have located to or are locating to the

proposed area; elected officials familiar with the medical needs

of the community; and health care planning professionals.

28. The St. Lucie River divides St. Lucie County east to

west. Only the areas west of the river have been designated as

the primary service area for the proposed hospital. The primary

service area comprises the land within zip codes 34983, 34984,

34986, 34953, 34987, and 34988. The secondary service area

comprises those lands encompassed by zip codes 34981, 34982,

34952, and 34957. These primary and secondary service areas have

been reasonably determined to project admissions and other

relevant use data. As is later addressed in more detail, the

population projected for the service area will reasonably

support the utilization required to make the proposed hospital

financially feasible.

Review Criteria

29. Every new hospital project in Florida must be reviewed

pursuant to the statutory criteria set forth in Section 408.035,

Florida Statutes (2007). Accordingly, the ten subparts of that

provision must be weighed to determine whether or not a proposal

meets the requisite criteria. In this case, the parties have

identified the provisions of law that pertain to this matter.

30. Section 408.035(1), Florida Statutes (2007) requires

that the need for the health care facilities and health services

being proposed be considered. In the context of this case,

"need" will not be addressed in terms of its historical meaning.

The Agency no longer calculates "need" pursuant to a need

methodology. Therefore, looking to Florida Administrative Code

Rule 59C-1.008, requires consideration of the following

pertinent provisions:

. . . If an agency need methodology does not

exist for the proposed project:

1. The agency will provide to the

applicant, if one exists, any policy upon

which to determine need for the proposed

beds or service. The applicant is not

precluded from using other methodologies to

compare and contrast with the agency policy.

2. If no agency policy exists, the

applicant will be responsible for

demonstrating need through a needs

assessment methodology which must include,

at a minimum, consideration of the following

topics, except where they are inconsistent

with the applicable statutory or rule

criteria:

a. Population demographics and dynamics;

b. Availability, utilization and quality of

like services in the district, subdistrict

or both;

c. Medical treatment trends; and,

d. Market conditions.

3. The existence of unmet need will not be

based solely on the absence of a health

service, health care facility, or beds in

the district, subdistrict, region or

proposed service area.

31. According to Martin, "need" is evidenced by a large

current and projected growing population in the proposed service

area (PSA), sustained population growth that exceeds the

district and state averages, capacity constraints at the

existing providers, geographic access barriers including traffic

congestion and the St. Lucie River, the need for improved access

for emergency medical services, enhanced geographic and

financial access to obstetrical services for residents of the

western portion of the county, growth to offset impact on

existing providers, and the financial health of existing

providers.

32. As previously stated, St. Lucie County is divided by

the St. Lucie River. The river is crossed west-to-east by a

limited number of bridges that can back up and delay the traffic

utilizing them for access to St. Lucie. The county is traveled

north to south by two major roadways: U.S. Highway 1 and I-95.

To travel from the western portions of the county and the

Tradition community, vehicles cross I-95, the river, and travel

U.S. Highway 1 to St. Lucie.

33. The PSA is the fastest growing portion of the county.

The older areas to the east are not growing at the rate

associated with the development of Tradition and other

communities to the west. Some of the coastal areas to the east

have become "saturated." That is to say, building and growth

restrictions along the coast have limited the population in

those areas. The western portion of the county is one of the

most rapidly growing communities in the state and has become one

of the focal areas of growth for the region. Although the rate

of growth has slowed in the recent economic decline, the St.

Lucie County area is still predicted to grow at an increased

pace in the near future.

34. Population projections prepared by the Bureau of

Economics and Business Research at the University of Florida

demonstrate that the growth reasonably expected for the PSA is

fairly dramatic. According to Dr. Smith, whose testimony has

been credited, the primary service area population is expected

to reach or exceed 180,977 by 2015. If underestimated (as is

typical of these types of projections), the growth could easily

exceed that projection. The projection was based upon the most

currently available data and has not been contradicted by more

reliable data. Claritas data also suggested that the

projections produced by Dr. Smith's work were reasonable.

35. The projected growth rate in the primary service area

exceeds the projected growth rate of the district as well as for

Florida for the period 2007-2015. This finding is supported by

the credible weight of the data admitted into evidence.

36. Although the population growth has slowed due to

economic conditions, the county will experience renewed growth

in the PSA with the projected reversal of slowing trends.

Development in the PSA continues to be the most likely

geographic area that will be improved first and faster than

other areas of the county.

37. Looking at the age component of the population

projected for the PSA, the age 65 and over cohort is the fastest

growing segment of the population; the second is the 45-64

population segment. These segments are the majority of the

acute care hospital utilization. Additionally, females ages 15-

44 also reflect a high rate of growth for the primary service

area. This latter statistic supports the notion that a demand

for obstetrics is likely.

38. Acute care hospital utilization in the subdistrict

increased from 2003 through June 2008. The non-tertiary

discharges within the primary service area increased by 42

percent for the period 2003 to 2007. Birth volume in the

primary service area increased for the same period and doubled

the number of obstetric admissions for the time noted. This

increase in utilization supports the likelihood that population

growth for the area will further increase the utilizations

expected for the PSA.

39. Historically, St. Lucie has observed this utilization

and growth of demand for its services. St. Lucie has responded

by adding beds to its ED but the projections would suggest that

past and future growth will result in capacity constraints for

St. Lucie. Demand for intensive care, medical surgical beds,

and progressive care beds at St. Lucie has been high. The ICU

occupancy rate at St. Lucie in particular has been at or above

85 percent capacity a significant portion of the time.

40. Capacity issues are more pronounced during the months

from November through May of each year. The subdistrict enjoys

a strong seasonal influx of residents who require all the

amenities of a community including medical care. In this

regard, St. Lucie has seen a "bed crunch" in order to

accommodate the seasonal patients. This crunch results in

longer ED waits, longer waits for admissions for those requiring

acute care, longer waits for those seeking elective admissions,

and longer waits for some services such as blood transfusions.

41. Although hospitals are not intended to be like fast

food restaurants (providing all services on a expedited basis),

extended waits for bed placement can place waiting patients on

gurneys in less than optimal conditions. This scenario does not

promote efficient or the most effective form of providing health

care services to those in need.

42. The bed crunch at St. Lucie is expected to continue

due to increasing demand for acute care hospital services in the

county.

43. Capacity constraints are similarly demonstrated at

Lawnwood and Martin. Like St. Lucie, Lawnwood and Martin

experience the seasonal crunch associated with the increased

population during the winter months.

44. In Lawnwood's case, the ED has delays through out the

year. This means that patients wait for a bed assignment in the

ED until a suitable room placement can be made. Additionally,

the intensive care unit at Lawnwood experiences high occupancy.

As Lawnwood transitions to a trauma center, the demand for acute

care beds will also increase. Lawnwood will be the sole trauma

center for the region and will likely receive an increase in

utilization from that patient source.

45. Martin also has experienced high utilization and has

operated at or near capacity for extended periods during the

season. Further, the birth volume growth for Martin supports

the conclusion that additional obstetric beds are needed for the

subdistrict. The majority of Martin's increased birth volume

has come from the PSA.

46. Martin has also established that obstetrics patients

travel from areas closer to Lawnwood or St. Lucie to seek

services at Martin. This demand for obstetrical services in the

PSA also suggests that the proposed hospital would enhance

access to obstetrics in the subdistrict. Patients who might be

induced (as the mother is past her due date) for labor must, at

times, wait for a delivery bed. Additionally, patients who

present in labor do not always have a labor bed. The new

facility would ease these constraints.

47. The location of the hospital at Tradition will also

improve geographic access to medical facilities. The traffic

and natural barriers to health care services (limited west to

east roadways and the river) would be eliminated by the proposed

facility. Additionally, during periods of storm events,

residents throughout the subdistrict would have access to an

acute care hospital without driving to the coastal area.

48. The demand for emergency medical response and

transport in St. Lucie County has increased dramatically. The

St. Lucie County Fire Department transports all patients

requiring advanced life support services in the county. When

traveling from the western portions of the county, the emergency

transports use the same roadways to cross the river as the

general population. Delays are common. Even after delivering a

patient to the St. Lucie ED, the transport must return west from

its point of origin in order to return to service. The delays

in traversing the county result in delays for the unit to be

able to respond to the next call. Although it is impractical to

have a hospital on every corner, the establishment of a hospital

at Tradition would greatly enhance the response times for

emergency vehicles and enhance their ability to return to

service more quickly. To respond to the increased population

and need in the Tradition community, the county has established

two new fire stations in the area. The primary service area has

the greatest need for additional fire and emergency services

according to Chief Parrish.

49. To help address the problem of having rescue units out

of service for extended periods of time while transporting

patients to an existing hospital east of the river (or while

they are returning west to their service area), the Fire

Department has doubled rescue trucks and paramedics at two

stations in the western portion of the county. This duplication

of manpower and equipment increases emergency costs for the

county.

50. Although there are plans for the construction of

another bridge across the river that would ease some of the

congestion in crossing the county, it is unknown when that

bridge will be funded and constructed. City personnel do not

expect the bridge to be started prior to 2017.

51. The proposed hospital will provide improved access for

emergency medical services.

52. The proposed hospital will provide enhanced access to

obstetrical services for the residents of the PSA.

53. With regard to financial access, the weight of the

credible evidence supports the finding that residents of the PSA

are able to adequately access medical services. Existing

providers are meeting the needs of the needy and those without

ability to pay. Although the new hospital would provide a

closer point of service for the indigent or Medicaid recipients

who may lack transportation advantages of the more affluent, the

needy are currently being served by existing providers.

54. The existing providers are financially healthy and are

well able to meet the needs of the indigent. Should the new

hospital siphon off the more desirable patients ( ie . the

insured, Medicare, self-pay, etc.), the existing providers

should be able to continue to provide the indigent care needed

by the subdistrict. Additionally, the new hospital would also

be expected to accept Medicaid or indigent patients.

avel times within the subdistrict further suggest

that the addition of a new hospital would reduce the time for

all residents to arrive at an acute care hospital. Although the

travel times currently suggest that patients could access an

existing provider within 40 minutes, the addition of the new

facility would ensure that during crunch times or times of

traffic congestion or other times when factors extend the time

for access to service, any patient from the PSA can be assured

of prompt medical care.

56. Establishment of the new hospital will also improve

access in the event of a catastrophe or disaster. Given the

recent history of hurricanes in the state, improved access to

medical facilities in times of crisis can be critical to the

patient as well as the emergency crews working during such

events.

57. To the extent that any existing provider loses

admissions to the new hospital, the growth in population and

projected admissions will adequately offset the loss of

admissions. Further, the utilization expected by all providers

will adequately assure their financial stability as the new

provider achieves or exceeds its projected goals.

58. Martin has demonstrated a strong financial position

for a number of years. The establishment of the new hospital

will not compromise Martin's financial strength or detract from

its provision of services at the two hospital campuses it

currently utilizes. The new, third campus will complement and

enhance the Martin Health Care System.

59. Martin has demonstrated the project is financially

feasible both in the short and long term. Martin's past

financial performance and continued strong financial position

assure that it will be able to obtain financing for the proposed

hospital construction and start up. Moreover, the projected

patient days to be captured by the new hospital will assure that

the hospital will achieve its "break even" financial point at a

reasonable future date. The project should achieve revenues in

excess of expenses by its third year of operation.

60. The projections for utilization are reasonable and are

based upon reasonable assumptions including the premise that

Martin will redirect admissions from its southern facilities to

services more geographically accessible at the new hospital.

Martin has an established presence in the PSA and should be able

to achieve its expected admissions without adversely impacting

St. Lucie or Lawnwood.

61. The revenue projections for the new hospital are

reasonable and should be achieved.

62. Martin has the resources, the workforce, and physician

coverage to provide for the new hospital. Additionally, it is

expected that new physicians will seek privileges at the new

hospital and will provide emergency on-call coverage as may be

needed. St. Lucie and Lawnwood have coverage for the medical

specialties and ED departments at their facilities.

63. Martin has a low vacancy and turnover rate for both

nursing and non-nursing personnel. It partners with the

community to sponsor initiatives that promote continued success

in these areas. It is a favored employer among those in Martin

County.

64. The staffing projections for nursing and clinical

support for the new hospital are reasonable. The projected

salaries are also in line with those currently offered and

should be reasonable and easily achieved. In short, the

applicant has demonstrated that Schedule 6A of the application

is supported by the record in this cause.

65. Martin has demonstrated it is able to implement the

project and to staff its needs at the levels projected by the

application.

66. St. Lucie County will grow at a sufficient rate to

assure that all providers, including the proposed hospital, will

have admissions to meet the financial needs of the institutions.

Moreover, the growth anticipated is sufficient to fund the

future improvements or expansions that may be required by the

providers. Essentially, when considered as a whole, west to

east, the county has sufficient growth potential to support the

additional acute care hospital beds proposed by the applicant.

67. Competition for the future beds will be enhanced by

the additional provider. St. Lucie and Lawnwood will continue

to perform well in the market. St. Lucie will continue to

achieve the lion's portion of the market east of the river while

Lawnwood will continue to serve the region as it has with

tertiary and the newly added trauma services. If anything,

Martin will take the largest hit from the establishment of the

new hospital as it will seek to allow its patients from the PSA

that currently travel south and east to Martin hospitals to

remain in their community at the new facility. Acting as the

"mother ship," Martin is willing to promote the new hospital so

that the stresses it has at the Martin County hospitals may be

alleviated. The Martin system as a whole will continue to grow

and benefit from the addition of the new hospital.

68. Martin is the chief initiator of medical services to

the western St. Lucie County community. No HCA hospital has

attempted to establish a presence in the Tradition area that

matches or exceeds the commitment Martin has made to the

residents of western St. Lucie County.

69. St. Lucie and Lawnwood will continue to provide

quality care to their patients and will continue to be

financially strong should the new hospital come on line.

70. The adverse impact suggested by the HCA hospitals is

not supported by the weight of the credible evidence in this

cause. In short, the market projections are adequate to assure

all providers will continue to share a significant portion of

the health care pie. The growth in population, growth in

admissions and utilization, the demographics of the population,

and the reputation of all providers to provide quality care

support the long term success of all providers in the

subdistrict.

71. The establishment of the new hospital will also

promote competition as medical and clinical research also come

into play. Should the new hospital located near the research

facilities promote clinical trials, all providers in the

subdistrict would benefit from any successful achievements.

72. Martin has agreed to the following conditions for the

CON:

Martin will partner with Torrey Pines

Institute for Molecular Studies for the

provision of resources associated with

clinical trials and life science research.

Martin will continue to support the

Volunteers in Medicine program with free

inpatient and outpatient hospital services,

outpatient laboratory, diagnostic and

treatment services at a value of not less

than $750,000 of charges per year for the

next 10 years.

Martin will support other community social

services organizations in the form of cash,

goods and services valued at not less than

$75,000 annually for the next 10 years.

This represents a commitment of $750,000 to

support organizations such as Meals on

Wheels, American Cancer Society, American

Heart Association, etc.

Martin will support Florida Atlantic

University Nursing School, Indian River

Community College and other area nursing and

allied health schools with at least $75,000

per year in services or goods for the next

10 years to help ensure an adequate supply

of well-trained health care professionals.

Martin will establish a volunteers program

(based on its current successful program in

Martin County) in Port St. Lucie area to

involve local high schools in encouraging

teens to volunteer in health care settings

and to encourage health care careers.

Martin will partner with the St. Lucie

school system in the development of a High

School Medical Academy.

Martin will make the West Port St. Lucie

Hospital available as a training site for

area nursing and allied health schools and

for the Florida State University physician

training program.

Martin will locate the new hospital south of

Tradition Parkway, east of Village Parkway,

adjacent to the Torrey Pines headquarters

and the I-95 Gatlin Boulevard exit.

Martin will provide a minimum of 11.1

percent of its total annual patient days in

the new hospital to Medicaid and Medicaid

HMO patients.

Martin will also provide a minimum of

$250,000 per year for Medicaid and/or

charity outreach programs within the western

Port St. Lucie area for the first five years

of operation.

73. This is not the first CON application submitted by

Martin to establish a hospital in the western portion of

St. Lucie County. The current application differs from others

in that the updated population and utilization data more clearly

establish that the projected growth for the subdistrict will

support the new facility without unduly impacting the existing

providers. The planning horizon for the instant application and

the pertinent data show that the western portion of the county

more closely resembles areas that have been granted satellite or

new hospital facilities in other areas of the state. The growth

projected for the county mandates additional healthcare

resources be devoted to the PSA. Additionally, similar to its

commitment to the Martin County residents, the applicant has

demonstrated it will partner with the St. Lucie County resources

to establish the same programs that have benefited other areas

of the subdistrict. Finally, while the Torrey Pines affiliation

was represented in prior applications, that facility is now a

reality and operational. The benefits of having the Martin

hospital adjacent to its facility is no longer speculative.

74. Torrey Pines is a nationally recognized research

entity. The State of Florida and St. Lucie County governmental

entities have pursued this type of research facility for

location to the state and this area. According to the Torrey

Pines leadership, the location of the Martin hospital in

proximity to its facility would enhance their efforts.

75. The architectural schematics, project completion

schedule, design narratives, and code compliance information set

fort in Martin's application are reasonable. The site

preparation and construction costs set forth on Schedule 9 are

reasonable for the project proposed. Additionally, the

equipment costs are reasonable.

76. There is no financial barrier to access hospital

services by the residents of the PSA.

77. The quality of care rendered by all hospitals in the

subdistrict is excellent.

78. Although there may be some impact on the admissions

and utilization at St. Lucie, the impact is not of such a

magnitude so as to adversely impact the quality of care and

provision of health services at that hospital.

79. The impact expected at Lawnwood should be less than

St. Lucie, nevertheless, it too is not of such a magnitude so as

to adversely impact the quality of care and provision of health

services at that hospital.

80. Section 408.035(2), Florida Statutes (2007), specifies

that the availability, quality of care, accessibility, and

extent of utilization of existing health care facilities and

health services in the service district must be considered. As

noted above, there is no barrier to services in the subdistrict.

Nevertheless, Martin has demonstrated that access to additional

services will be enhanced by the establishment of the new

hospital in the western area of the county. Additionally,

delays in admissions and capacity constraints at the existing

hospitals although not chronic or at a critical juncture are

evidenced in the record.

81. Section 408.035(3), Florida Statutes (2007), requires

the consideration of the ability of the applicant to provide

quality of care and the applicant's record of providing quality

of care. This criterion is not in dispute in this cause.

82. Section 408.035(4), Florida Statutes (2007), requires

the review of the availability of resources, including health

personnel, management personnel, and funds for capital and

operating expenditures, for project accomplishment and

operation. In this regard, Martin has established that it is

able to provide the resources necessary for this project.

Additionally, it has shown that projected salaries for the

nurses (as depicted on Schedule 6A) are reasonable and within

the general guidelines of Martin's provision of those services

at its other hospitals.

83. Section 408.035(5), Florida Statutes (2007), specifies

that the Agency must evaluate the extent to which the proposed

services will enhance access to health care for residents of the

service district. In the findings reached in this regard, the

criteria set forth in Administrative Code Rule 59C-1.030(2) have

been fully considered. Those provisions are:

(2) Health Care Access Criteria.

(a) The need that the population served or

to be served has for the health or hospice

services proposed to be offered or changed,

and the extent to which all residents of the

district, and in particular low income

persons, racial and ethnic minorities,

women, handicapped persons, other

underserved groups and the elderly, are

likely to have access to those services.

(b) The extent to which that need will be

met adequately under a proposed reduction,

elimination or relocation of a service,

under a proposed substantial change in

admissions policies or practices, or by

alternative arrangements, and the effect of

the proposed change on the ability of

members of medically underserved groups

which have traditionally experienced

difficulties in obtaining equal access to

health services to obtain needed health

care.

(c) The contribution of the proposed

service in meeting the health needs of

members of such medically underserved

groups, particularly those needs identified

in the applicable local health plan and

State health plan as deserving of priority.

(d) In determining the extent to which a

proposed service will be accessible, the

following will be considered:

1. The extent to which medically

underserved individuals currently use the

applicant’s services, as a proportion of the

medically underserved population in the

applicant’s proposed service area(s), and

the extent to which medically underserved

individuals are expected to use the proposed

services, if approved;

2. The performance of the applicant in

meeting any applicable Federal regulations

requiring uncompensated care, community

service, or access by minorities and

handicapped persons to programs receiving

Federal financial assistance, including the

existence of any civil rights access

complaints against the applicant;

3. The extent to which Medicare, Medicaid

and medically indigent patients are served

by the applicant; and

4. The extent to which the applicant

offers a range of means by which a person

will have access to its services.

(e) In any case where it is determined that

an approved project does not satisfy the

criteria specified in paragraphs (a) through

(d), the agency may, if it approves the

application, impose the condition that the

applicant must take affirmative steps to

meet those criteria.

(f) In evaluating the accessibility of a

proposed project, the accessibility of the

current facility as a whole must be taken

into consideration. If the proposed project

is disapproved because it fails to meet the

need and access criteria specified herein,

the Department will so state in its written

findings.

84. AHCA does not require that a CON applicant demonstrate

that the existing acute care providers within the PSA are

failing in order to approve a new hospital. Also, AHCA does not

have a travel time standard with respect to the provision of

acute care hospital services. In other words, there is no set

geographical distance or travel time that dictates when a

hospital would be appropriate or inappropriate. In fact, AHCA

has approved hospitals when residents of the PSA live within

twenty minutes of an existing hospital. As a practical matter

this means that travel time or distance do not dictate whether a

satellite should be approved based upon access. With regard to

access to emergency services, however, AHCA does consider

patient convenience.

85. In this case, the proposed hospital will provide a

convenience to residents of western St. Lucie County in terms of

access to an additional emergency department. Further,

physicians serving the growing population will have the

convenience of admitting patients closer to their residences.

Medical and surgical opportunities at closer locations is also a

convenience to the families of patients because they do not have

to travel farther distances to visit the patient. Patients and

the families of patients seeking obstetrical services will also

have the convenience of the hospital.

86. Patients who would not benefit from the convenience of

the proposed hospital would be those requiring tertiary health

services. Florida Administrative Code Rule 59C-1.002(41)

defines such services as:

(41) Tertiary health service means a health

service which, due to its high level of

intensity, complexity, specialized or

limited applicability, and cost, should be

limited to, and concentrated in, a limited

number of hospitals to ensure the quality,

availability, and cost effectiveness of such

service. Examples of such service include,

but are not limited to, organ

transplantation, specialty burn units,

neonatal intensive care units, comprehensive

rehabilitation, and medical or surgical

services which are experimental or

developmental in nature to the extent that

the provision of such services is not yet

contemplated within the commonly accepted

course of diagnosis or treatment for the

condition addressed by a given service.

87. In terms of tertiary health services, residents of the

subdistrict will continue to use the existing providers who

offer those services. The new hospital will not compete for

those services.

88. Lawnwood will continue to provide tertiary services to

the PSA and will continue to be a strong candidate for any

patient in the PSA requiring trauma services when that service

comes on line.

89. Section 408.035(6), Florida Statutes (2007) provides

that the financial feasibility of the proposal both in the

immediate and long-term be assessed in order to approve a CON

application.

90. In this case, as previously indicated, the

utilizations expected for the new hospital should adequately

assure the financial feasibility of the project both in the

immediate and long-term time frames. Population growth, a

growing older population, and technologies that improve the

delivery of healthcare will contribute to make the project

successful.

91. The new Martin hospital will afford PSA residents a

meaningful option in choosing healthcare and will not give any

one provider or entity an unreasonable or dominant position in

the market.

92. Section 408.035(7), Florida Statutes (2007) specifies

that the extent to which the proposal will foster competition

that promotes quality and cost-effectiveness must be addressed.

93. This subdistrict enjoys a varied range of healthcare

providers. All demonstrate strong financial stability and

utilization. A new hospital will promote continued quality and

cost-effectiveness. Physicians will have another option for

admissions and convenience.

94. Section 408.035(8), Florida Statutes (2007), notes

that the costs and methods of the proposed construction,

including the costs and methods of energy provision and the

availability of alternative, less costly, or more effective

methods of construction should be reviewed.

95. The methodology used to compute the construction costs

associated with this project were reasonable and accurate at the

time prepared. No more effective method of construction has

been proposed. The financial soundness of the proposal should

cover the actual costs associated with the construction of the

project. Additionally, the free-standing ED that Martin is

constructing will be transitioned to a urgent care clinic or

some other health care facility, it will not continue to provide

emergent services when the new hospital is on line. Therefore,

it should not be considered a less costly alternative for ED

services.

96. Section 408.035(9), Florida Statutes (2007), provides

that the applicant's past and proposed provision of health care

services to Medicaid patients and the medically indigent should

be weighed in consideration of the proposal.

97. Martin has a track record of providing health care

services to Medicaid patients and the medically indigent without

consideration of any patient's ability to pay. The new hospital

would be expected to continue this tradition. Moreover, this

criterion is adequately addressed by the proposed conditions to

the CON approval.

98. Section 408.035(10), Florida Statutes, relates to

nursing home beds and is not at issue in this proceeding.

The Agency's Rationale

99. The SAAR set forth the Agency's rationale for the

proposed approval of the CON application. The SAAR acknowledged

that the proposal received varied support from numerous sources.

Further, the SAAR acknowledged that funding for the project

would be available; that the short-term position, long-term

position, capital requirements, and staffing for the proposal

were adequate; that the project was financially feasible if the

applicant meets its projected occupancy levels; that the project

would have a positive effect on competition to promote quality

and cost-effectiveness; and that the construction schedule is

reasonable.

100. The SAAR also recognized the improved access for

obstetrical services for residents of the growing western

St. Lucie County. This also reinforced the generally recognized

improvements to access geographically given the limitations in

east-west traffic access. Finally, the SAAR recognized that

Martin is the provider that has invested in the western portion

of the subdistrict by establishing clinics and physician

networks to provide care to the residents of the PSA. Opponents

to the new hospital have not similarly committed to the

residents of western St. Lucie County. The opponents maintain

that enhanced access for residents of the PSA does not justify

the establishment of a new hospital since the residents there

already have good access to acute care services.

CONCLUSIONS OF LAW

101. The Division of Administrative Hearings has

jurisdiction over the parties to and the subject matter of these

proceedings. §§ 120.569 and 120.57(1), Fla. Stat. (2007).

102. Martin has the burden to prove by a preponderance of

the evidence that its CON application should be approved. See ,

e.g. , Boca Raton Artificial Kidney Center, Inc. v. Dept. of

Health and Rehabilitative Servs. , 475 So. 2d 260, 263 (Fla. 1st

DCA 1985); § 120.57(1)(j), Fla. Stat. (2007).

103. The Agency's preliminary decision and the findings in

the SAAR are not entitled to a presumption of correctness in

this de novo proceeding. See generally Dept. of Transportation

v. J.W.C. Co., Inc. , 396 So. 2d 778, 787 (Fla. 1st DCA 1981).

The Agency's construction and interpretation of its rules and

the statutes that it is charged to implement, however, are

entitled to deference. See , e.g. , State Contracting &

Engineering Corp., v. Dept. of Transportation , 709 So. 2d 607,

610 (Fla. 1st DCA 1998); § 120.57(1)(l), Fla. Stat. (2007).

104. The decision of whether to approve a CON application

must be based on a balanced consideration of all statutory and

rule criteria. St. Joseph's Hospital v. Department of Health

and Rehabilitative Services , 536 So. 2d 346 (Fla. 1st DCA 1988);

Department of Health and Rehabilitative Services v. Johnson &

Johnson Home Healthcare, Inc. , 447 So. 2d 361 (Fla. 1st DCA

1984); Balsam v. Department of Health and Rehabilitative

Services , 486 So. 2d 1341 (Fla. 1st DCA 1986). The weight to be

given to each criterion is not fixed, but depends on the facts

and circumstances of each case. Collier Medical Center, Inc. v.

Department of Health and Rehabilitative Services , 462 So. 2d 83

(Fla. 1st DCA 1985).

105. All parties in this cause have the requisite standing

to participate in this proceeding pursuant to Section

408.039(5)(c), Florida Statutes (2007).

106. In this case Martin has presented a need methodology

that argues the new hospital should be approved. The Agency

supports that conclusion and the rationale for its preliminary

decision of approval is cogently articulated in the SAAR. The

opponents disagree (for the most part) based upon their

perception that the area growth has slowed, that the

utilizations projected are not reasonable, and that the existing

providers will be adversely affected by the new hospital.

107. As to Martin's methodology, this applicant has

demonstrated a new hospital in Tradition will enhance emergency

department access. Further, the new hospital will provide

patients with a meaningful option for hospital services in the

western portion of St. Lucie County. The new hospital will

offer enhanced access to obstetrical services to residents of

the PSA. And finally, it will offer reduced travel times for

patients and their families using the facility. These

conveniences of access have been established.

108. As to the Petitioners' concern that the new hospital

will siphon patients from St. Lucie and Lawnwood, the projected

growth in population in the PSA as well as the county as a whole

should adequately generate sufficient patient days to alleviate

such fears. If Martin is correct in its assessment, all of the

providers in the subdistrict will continue to grow their

admissions and/or patient days based upon population growth and

increased utilization.

109. Improving access to acute care hospital services

including emergency services in non-urban areas experiencing

growth (similar to the PSA herein) is the trend in medical

treatment. The addition of the subject hospital will provide

such services to a growing area of western St. Lucie County.

110. Patients requiring tertiary services will not be

benefited by the new hospital but those who require emergency

services will have a second option that will lessen emergency

department wait time. On balance Martin has established need

for its proposed new hospital based upon its methodology,

Florida Administrative Code Rule 59C-1.008(2)(e), as well as the

criteria found in Section 408.035, Florida Statutes (2007).

111. The opponents have argued that the doctrine of

administrative finality precludes the approval of the instant

CON application. According to St. Lucie and Lawnwood:

The doctrine of "administrative finality"

ensures that decisions and orders of

administrative agencies, like those of

courts, have a point at which they become

final and conclusive. See Florida Power &

Light Co. v. Beard , 626 So. 2d 660, 662

(Fla. 1993) (citing Peoples Gas Sys.,Inc. v.

Mason , 187 So. 2d 335, 339 (Fla. 1966)).

The Supreme Court of Florida has explained

that, under administrative finality, "[a]

decision, once final, may only be modified

if there is a significant change in

circumstances or if modification is required

in the public interest." Florida Power

Corp. v. Garcia , 780 So. 2d 34, 44 (Fla.

2001) (citing Austin Tupler Trucking, Inc.

v. Hawkins , 377 So. 2d 679, 681 (Fla.

1979)).

In this matter, it is concluded that Martin has presented

significant changes in the circumstances that warrant approval

of the CON application. Moreover, Martin has demonstrated a

significant public interest in the approval of the new hospital.

The population, utilization, demographics and ED needs of the

western portion of St. Lucie County all support the approval of

the new hospital for that area. The PSA will be better served

as a result of the approval of the CON application and the

applicant has adequately demonstrated the evidence supports that

approval.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is

RECOMMENDED that a Final Order be entered by the Agency for

Health Care Administration that approves CON Application No.

9981 with the conditions noted in the SAAR.

DONE AND ENTERED this 31st day of July, 2009, in

Tallahassee, Leon County, Florida.

J. D. PARRISH

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 31st day of July, 2009.

COPIES FURNISHED :

Paul H. Amundsen, Esquire

Julie Smith, Esquire

Amundsen & Smith

502 East Park Avenue

Post Office Drawer 1759

Tallahassee, Florida 32302

Karin M. Byrne, Esquire

Agency for Health Care Administration

Fort Knox Building III, Mail Station 3

2727 Mahan Drive, Suite 3431

Tallahassee, Florida 32308

Robert A. Weiss, Esquire

Karen A. Putnal, Esquire

Parker, Hudson, Rainer & Dobbs, LLP

The Perkins House, Suite 200

118 North Gadsden Street

Tallahassee, Florida 32301

Stephen A. Ecenia, Esquire

J. Stephen Menton, Esquire

David Prescott, Esquire

Rutledge, Ecenia, & Purnell

215 South Monroe Street, Suite 420

Post Office Box 551

Tallahassee, Florida 32302-0551

Richard J. Shoop, Agency Clerk

Agency for Health Care Administration

2727 Mahan Drive, Mail Station 3

Tallahassee, Florida 32308

Justin Senior, General Counsel

Agency for Health Care Administration

Fort Knox Building, Suite 3431

2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

Holly Benson, Secretary

Fort Knox Building, Suite 3116

2727 Mahan Drive

Tallahassee, Florida 32308-5403

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.