Mississippi State Department of Health v. Baptist Memorial Hospital-DeSoto, Inc.

984 So. 2d 967, 2008 Miss. LEXIS 323, 2008 WL 2447148
CourtMississippi Supreme Court
DecidedJune 19, 2008
DocketNo. 2007-SA-00035-SCT
StatusPublished
Cited by11 cases

This text of 984 So. 2d 967 (Mississippi State Department of Health v. Baptist Memorial Hospital-DeSoto, Inc.) is published on Counsel Stack Legal Research, covering Mississippi Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mississippi State Department of Health v. Baptist Memorial Hospital-DeSoto, Inc., 984 So. 2d 967, 2008 Miss. LEXIS 323, 2008 WL 2447148 (Mich. 2008).

Opinion

RANDOLPH, Justice,

for the Court.

¶ 1. DeSoto Imaging and Diagnostics, LLC (“DeSoto”) entered into an agreement with Alliance Imaging (“Alliance”) for the provision of mobile magnetic resonance imaging (“MRI”) services, contingent upon DeSoto procuring a Certificate of Need (“CON”) from the Mississippi State Department of Health (“MSDH”). DeSoto’s subsequently filed CON application was opposed by Baptist Memorial Hospital-DeSoto, Inc. (“Baptist”) and De-Soto Diagnostic Imaging, LLC (“Carvel”). Following a three-day hearing, the hearing officer issued his “Proposed Findings of Fact and Conclusions of Law,” finding that DeSoto’s application complied with the Fiscal Year 2006 Mississippi State Health Plan’s (“State Health Plan”) “General Certificate of Need Policies,” the State Health Plan’s “CON Criteria and Standards for the Offering of MRI Services,” and the CON Review Manual’s “General Considerations,” and recommended approval of De-Soto’s application.

¶ 2. Soon thereafter, Gilmore Memorial Hospital (“Gilmore”), a hospital on the proposed mobile route which DeSoto was to join, terminated its MRI Service Agreement with Alliance. Baptist and Carvel then filed a “Joint Motion to Reopen and Supplement Record and for Reconsideration of Hearing Officer’s Findings of Fact and Conclusions of Law,” alleging that because of this development, the mobile route proposed would not meet requirements of the State Health Plan. Alliance subsequently attested that alteration of routes was common and a modified route would satisfy the State Health Plan’s requirements. The hearing officer denied the motion and reaffirmed the recommendation to grant DeSoto’s application. The State Health Officer subsequently issued a final order adopting the findings and recommendation of the hearing officer.

¶ 3. Baptist and Carvel filed a “Notice of Appeal” in the Chancery Court of Hinds County. Following hearing, the chancery court issued an “Opinion and Order” reversing the MSDH’s approval of DeSoto’s application and remanding to the MSDH “with the mandate that, if [DeSoto] wishes to propose a new MRI route, that new route be subjected to a hearing during the course of review at which interested parties may oppose or support the new route.” From that ruling proceeds this appeal filed by DeSoto and the MSDH. The central issue for consideration is not a specific route, but whether the minimum number of procedures required by the State Health Plan to obtain a CON would be met by the new route.

FACTS

¶ 4. On August 30, 2005, Gordon Smith, area sales manager for Alliance, sent a letter to Kevin Blackwell, president and [971]*971CEO of DeSoto, providing “written notice of [Alliance’s] intention to provide MRI services two (2) days per week at your facility....” Thereafter, DeSoto filed a CON application with the MSDH for the establishment of mobile MRI services in DeSoto County. According to DeSoto’s application, “[t]he proposed ... unit is a 1.5 Tesla unit that currently serves [Gilmore] ... in Amory and Mission Primary Care Clinic [ (‘Mission’) ] ... in Vicksburg on a mobile route. Alliance has confirmed the equipment’s exemption for the CON process.[1] [DeSoto] will simply join this existing route.”2 In support of the application, DeSoto proposed that the number of procedures provided would exceed the requirements of the State Health Plan,3 that DeSoto County was experiencing significant population growth,4 and that an adverse impact on other MRI providers in the General Hospital Service Area was not anticipated. The application added that “[t]he agreement with Alliance is contingent upon the granting of a[CON] pursuant to this Application.”

¶ 5. On November 7, 2005, Sam Daw-kins, Director of the Office of Health Policy and Planning for the MSDH, received letters from Baptist and Carvel opposing the application. Ten days later, an MSDH staff analysis concluded that DeSoto’s application “is not in substantial compliance with applicable criteria and standards!,]”5 and recommended disapproval.6

¶ 6. On December 5, 2005, a “Request for Public Hearing During the Course of Review” was received by the MSDH from DeSoto, Carvel, and Baptist. In March 2006, a three-day hearing was held regarding DeSoto’s application. Twelve witnesses testified, and twenty-four exhibits were introduced into evidence. On July 6, [972]*9722006, the hearing officer issued his “Proposed Findings of Fact and Conclusions of Law,” finding that DeSoto’s application complied with the State Health Plan’s “General Certificate of Need Policies,” the State Health Plan’s “CON Criteria and Standards for the Offering of MRI Services,”7 and the CON Review Manual’s “General Considerations.”8 According to the hearing officer:

[ultimately ... the determination of need, defined by the State Health Plan as 1,700 scans per year, is controlling. That said, however, this Application is troublesome in several ways. The route of which this new service will be a part is less than concrete. The provider of the mobile unit, [Alliance], is engaged in contract negotiations with [Gilmore] and is currently providing service at that location on a month to month basis.

(Emphasis added). Therefore, as “the record contains substantial evidence that the proposed new service will join a mobile route that will produce in excess of 1,700 scans per year,” the hearing officer recommended approval of DeSoto’s application.

¶ 7. On July 14, 2006, Monte Bostwick, CEO of Gilmore, sent a letter to Alliance providing that “[t]his letter is to serve as our 30-day notice to terminate the MRI Service Agreement between [Alliance] and [Gilmore].” (Emphasis added). On July 24, 2006, Baptist and Carvel filed a “Joint Motion to Reopen and Supplement Record and for Reconsideration of Hearing Officer’s Findings of Fact and Conclusions of Law,” arguing that “[o]ne ... issu[e] in the hearing was whether the proposed MRI ■ route would perform in excess of 1,700 MRI procedures per year. In light of this recent development, ... the mobile route will not meet that State Health Plan requirement.” As such, the motion requested that this new evidence be admitted into the record and considered by the hearing officer “in order for a true, accurate and complete evaluation of this application to be made by the [MSDH].”

[973]*973¶8. In response, an affidavit of Cindy Smith, Director of Operations for Alliance, was presented attesting that “[i]n the mobile MRI industry it is common for mobile MRI routes to be altered and/or for contracts for mobile MRI services to be amended or cancelled.” Smith stated De-Soto would be shifted to a route including Sweetwater Hospital Association (“Sweet-water”) in Sweetwater, Tennessee, and Macon General Hospital (“Macon”) in Lafayette, Tennessee, as the MRI unit used on that route “currently sits idle two days a week.” Smith averred that the route change would not affect the approval of DeSoto’s application, as Sweetwater and Macon had performed 2,323 MRI procedures combined in the previous twelve months.9

¶ 9. Following a August 11, 2006, hearing, the hearing officer entered his “Findings and Conclusions on Motion to ReOpen Record,” concluding that:

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Bluebook (online)
984 So. 2d 967, 2008 Miss. LEXIS 323, 2008 WL 2447148, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mississippi-state-department-of-health-v-baptist-memorial-hospital-desoto-miss-2008.