Beverly Enterprises-Florida, Inc. v. Department of Health & Rehabilitative Services

527 So. 2d 218, 13 Fla. L. Weekly 1066, 1988 Fla. App. LEXIS 1843, 1988 WL 43410
CourtDistrict Court of Appeal of Florida
DecidedMay 4, 1988
DocketNos. BS-254, BS-274 and BS-322
StatusPublished
Cited by1 cases

This text of 527 So. 2d 218 (Beverly Enterprises-Florida, Inc. v. Department of Health & Rehabilitative Services) is published on Counsel Stack Legal Research, covering District Court of Appeal of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Beverly Enterprises-Florida, Inc. v. Department of Health & Rehabilitative Services, 527 So. 2d 218, 13 Fla. L. Weekly 1066, 1988 Fla. App. LEXIS 1843, 1988 WL 43410 (Fla. Ct. App. 1988).

Opinion

ZEHMER, Judge.

We have for review consolidated appeals from an order of the Department of Health and Rehabilitative Services which denied appellants’ Certificate of Need applications for 120-bed nursing home facilities in Orange County, Florida. Appellants, Beverly Enterprises, Forum Group, Inc., and Hillha-ven Convalescent Center, contend that the order denying their CON applications violates the principles enunciated in Gulf Court Nursing Center v. Department of Health and Rehabilitative Services, 483 So.2d 700 (Fla. 1st DCA 1985), because [219]*219nursing home beds in the fixed pool for which the appellants had timely applied were improperly awarded to prior-batched applicants. Finding no error in the appealed order, we affirm.

On December 1, 1984, HRS published its Semi-Annual Nursing Homes Census Report and Bed Need Allocation identifying a need for 321 nursing home beds in Orange County, Florida, for the January 1988 planning horizon. This computation was based upon a mathematical formula contained in Rule 10-5.11(21) [now 10-5.011(l)(k) ], Florida Administrative Code, as amended, which was effective on December 27, 1984. In mid-December 1984, each of the appellants timely filed letters of intent, stating their intent to file CON applications to be reviewed in the January 1985 batching cycle. The applications were completed and comparatively reviewed in the January 1985 batching cycle for the January 1988 planning horizon.

Following the issuance of the December 1, 1984 Semi-Annual Census Report, but prior to HRS’ initial decision on appellants’ applications, HRS agreed to issue certificates of need for a total of 290 nursing home beds in Orange County to four other applicants, West Orange Manor, Park Lake Health Care Center, Florida Convalescent Centers, and Health Quest Realty, who had submitted applications in the July 1984 batch. These prior batched CON applications had been initially denied by HRS based on insufficient bed need in the July 1987 planning horizon. The revised methodology in Rule 10-5.11(21) as amended resulted in a new finding of need during the pendency of administrative appeals in which these applicants challenged the denial of their respective CON applications by HRS.

HRS reduced the 321 bed need identified in the December 1, 1984 Census Report by the 290 beds awarded to the prior batched applicants. On or about June 30, 1985, HRS issued letters to appellants denying their respective CON applications because there was now insufficient bed need in the district.

Appellants filed a timely request for a formal administrative hearing pursuant to § 120.57(1), Florida Statutes, to contest HRS’ denial of their CON applications. After determining that no factual dispute existed, the parties agreed to have their cases proceed to an informal hearing pursuant to § 120.57(2). The issue was whether appellants were entitled to be awarded CONs pursuant to their respective applications because the December 1, 1984 Census Report allegedly created a fixed pool of 321 needed beds available to the January 1985 batching cycle applicants and HRS had improperly granted CONs from this pool of beds to earlier batched applicants without requiring comparative review with appellants’ applications. The hearing officer found that the December 1, 1984 Census Report did not create a “fixed pool” of 321 beds needed in Orange County solely for the 1988 planning horizon, and concluded that this case did not parallel the situation in Gulf Court. As a result, the hearing officer recommended that appellants’ applications for CONs be denied.

On February 12, 1987, HRS entered its final order denying appellants’ applications for CONS and adopted the findings and conclusions of law made by the hearing officer. HRS also ruled that appellants were afforded a “clear point of entry” to challenge the issuance of the CONs to prior batched applications, which they now allege were granted from the fixed pool addressed by them, but that in lieu of utilizing that point of entry, appellants sought to collaterally attack the award of those CONs in an unrelated action. HRS concluded that there is no basis in law for permitting such a collateral attack.

Appellants contend before us that the award of beds from the January 1985 batching cycle to prior-batched applicants has clearly violated the principles enunciated and applied in Gulf Court. They argue that the 321 bed need figure published in the December 1984 Semi-Annual Report constituted a “fixed pool” for the January 1985 batching cycle exclusively, and that under Gulf Court HRS was required to comparatively review all of the applicants for that fixed pool. Thus, they argue, HRS [220]*220could not award the 290 beds to prior-batched applicants without first requiring them to update their applications to address the 1988 planning horizon and then comparatively reviewing these updated applications with appellants’ applications. Because HRS did not do this, appellants argue, it cannot lawfully reduce the 321 bed need figure by awarding CON’s to such prior applicants.

HRS answers that its order should be affirmed because appellants have failed to establish that the beds awarded to earlier batched applicants came from a “fixed pool” addressed by appellants’ applications. HRS states that the December 1984 report was not intended to create a fixed projection of need based upon a rule-defined need determination, but rather, that the report represents an informational tool based upon the most recent data existing at the time of its creation. HRS points to the cover sheet of the December 1984 SemiAnnual Report, which explains that the conclusions stated therein were clearly not “fixed” and were based upon information that was subject to change. HRS also contends that appellants were clearly on notice that the results of litigation involving pending earlier batched applications would necessarily be considered in the final analysis of appellants’ applications, and thus, the publication in February and March, 1985, of the issuance of CONs to earlier applicants provided appellants with a clear point of entry to challenge the propriety of those awards.

We conclude that this case is controlled by our decision in Inverness Convalescent Center v. Department of Health and Rehabilitative Services, 512 So.2d 1011 (Fla. 1st DCA 1987). In Inverness, the parties also argued that HRS had violated Gulf Court principles by not conducting a comparative review of all the applicants for the “fixed pool” of beds. HRS on the other hand argued that the semi-annual report did not create a “fixed pool”, and that a Gulf Court violation had not been shown. We stated:

This case requires us to decide how the “fixed pool” concept discussed in Gulf Court should be applied to a need for new beds which results from a change in the method of calculating bed need rather than from normal growth changes in the district. Obviously calculation under the amended rule, had it been used in prior years, might have shown an increased bed need for the planning horizon for those years. The fixed-pool concept for comparative review requires that HRS either allocate those additional beds between the prior years and the present batching cycle or treat all of the additional need as arising in the current planning horizon. HRS has now elected by rule to apply the latter approach:
Publication of Fixed Need Pools.

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527 So. 2d 218, 13 Fla. L. Weekly 1066, 1988 Fla. App. LEXIS 1843, 1988 WL 43410, Counsel Stack Legal Research, https://law.counselstack.com/opinion/beverly-enterprises-florida-inc-v-department-of-health-rehabilitative-fladistctapp-1988.