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State, Department of Helath v. Bayfront HMA Medical Center, LLC

Florida Court of Appeals, First District

January 2, 2018

State of Florida, Department of Health, Appellant,
v.
Bayfront HMA Medical Center, LLC d/b/a Bayfront Health - St. Petersburg, and Galencare, Inc. d/b/a Northside Hospital, Appellees. Galencare, Inc. d/b/a Northside Hospital, Appellant,
v.
Bayfront HMA Medical Center, LLC d/b/a Bayfront Health-St. Petersburg, Appellee.

         Not final until disposition of any timely and authorized motion under Fla. R. App. P. 9.330 or 9.331.

         On appeal from the Circuit Court for Leon County. Karen A. Gievers, Judge.

          Sarah Young Hodges, Chief Appellate Counsel, Florida Department of Health, Tallahassee; William Dean Hall III, Jones Walker, LLP, Tallahassee, for State of Florida, Department of Health.

          Raoul G. Cantero, David P. Draigh, and Ryan A. Ulloa, White & Case LLP, Miami; Stephen A. Ecenia, J. Stephen Menton, and Gabriel F.V. Warren, Rutledge Ecenia, Tallahassee; Thomas E. Warner, Dean A. Morande, and Michael D. Sloan, Carlton Fields Jorden Burt, P.A., West Palm Beach, for Galencare, Inc. d/b/a Northside Hospital.

          Geoffrey D. Smith and Timothy B. Elliott, Smith & Associates, Tallahassee, for Appellee, Bayfront HMA Medical Center, LLC d/b/a Bayfront Health - St. Petersburg.

          LEWIS, J.

         In these consolidated appeals, Appellants, the Department of Health (Department) and Galencare, Inc. d/b/a Northside Hospital (Northside), appeal a non-final order enjoining Northside from operating a provisional trauma center and enjoining the Department from allowing Northside to operate one prior to the conclusion of any timely-filed administrative proceeding challenging any preliminary approval of Northside's application and any judicial review. Appellants raise two issues on appeal, only one of which merits discussion. Appellants argue, and we agree, that the trial court erred by granting the motion for temporary injunction filed by Appellee, Bayfront HMA Medical Center, LLC d/b/a Bayfront Health - St. Petersburg (Bayfront), because Bayfront failed to prove its entitlement to temporary injunctive relief. Therefore, we reverse and remand.

         FACTUAL AND PROCEDURAL BACKGROUND

         Bayfront operates a level II trauma center in Trauma Service Area ("TSA") 9. On September 30, 2016, Northside submitted to the Department a letter of intent ("LOI") to apply for approval to operate a new trauma center in TSA 9. On October 14, 2016, the Department accepted Northside's LOI and responded with instructions on how to submit a trauma center application by the April 3, 2017, deadline.

         On March 10, 2017, Bayfront filed against Appellants a Complaint for Injunctive and Declaratory Relief, arguing that the Department lacks colorable authority to (1) accept a LOI and application from Northside because TSA 9 currently does not have a trauma center position available given that Florida Administrative Code Rule 64J-2.010 provides for two positions in that TSA and both are filled and (2) allow a provisional trauma center to operate during the pendency of an administrative challenge to the provisional approval of the application. In Count 1, Bayfront asked that the Department be enjoined from accepting and processing Northside's LOI and application and from allowing Northside to begin provisionally operating prior to the conclusion of any timely-filed administrative proceeding challenging any preliminary approval, and also asked that Northside be enjoined from operating as a provisional trauma center in TSA 9 until the conclusion of any administrative challenge. In Count 2, Bayfront sought a declaratory judgement.

         On March 24, 2017, Bayfront filed a Motion for Temporary Injunction, seeking to enjoin the Department from permitting Northside to begin operating as a provisional trauma center, and seeking to enjoin Northside from operating as a provisional trauma center, prior to the conclusion of all timely-filed administrative challenges. On or around March 31, 2017, Northside submitted to the Department an application to operate a trauma center in TSA 9. The parties stipulated that the Department would permit Northside to begin operating on May 1, 2017, if its application met the programmatic requirements upon the Department's review.

         At the April 5, 2017, evidentiary hearing on Bayfront's motion, Kathryn Gillette, the market president and CEO of Bayfront, testified that Bayfront tracks the zip codes of its patients and conservatively estimates, after having made some assumptions, that it would lose 905 of its 2, 725 patients and $4.5 million annually if Northside's trauma center were to open. Gillette was aware of only one emergency room nurse leaving Bayfront for Northside and was not aware of any physicians leaving. Gillette further testified that despite two trauma centers opening in the vicinity, Bayfront has maintained a quality program and sufficient patient volume. Gillette agreed that the Department's action of receiving and reviewing Northside's application does not pose any harm and there is no adverse impact until the Department approves the application.

         Dr. Steven Epstein, a trauma surgeon and the trauma medical director at Bayfront, testified that he believes if Northside opened a trauma center, Bayfront would lose half or more of its patients and there would be nothing to do to regain its patient volume, which in turn would have a financial impact on Bayfront and would endanger the trauma staff's skills. When Bayfront sought to prevent Regional Medical Center Bayonet Point, the other trauma center serving TSA 9, from being approved, Epstein was of the view in those legal proceedings that Bayonet's opening would have the same kind of impact he now believes Northside's opening will have. Epstein testified that Bayfront continues to provide high quality care that was not diminished by the opening of the two trauma centers in the vicinity, but opined that the opening of those trauma centers is not comparable to Northside because they are located farther away. Epstein added that even those openings resulted in a loss of patients to Bayfront, but Bayfront was able to recover its patient volume after working with EMS to revise the transport protocols. Epstein further testified that "nobody will be leaving Bayfront to go to Northside" because employees are bound by non-compete clauses and do not wish to leave, although trauma surgeons expressed a potential desire to leave if they cannot maintain their skills.

         Cindy Dick testified on the Department's behalf that according to the Department's 2016 assessment of the statewide trauma system, 36.35% of severely injured patients in TSA 9 did not receive care in a trauma center. Dick explained that the Department may review and provisionally grant an application irrespective of the availability of a trauma center slot in the TSA and the Department is not authorized to refuse to process Northside's application or to prevent Northside from beginning provisional operation on May 1st if its application is found acceptable. During litigations over the years, there has been much discussion about the quality of care declining at existing trauma centers as a result of new trauma centers opening nearby, but the ...


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