Hospitals File Petitions To Keep Competitors Out Of Southwest Florida Market

Hospital competitors in Southwest Florida have filed petitions to oppose three new hospitals that state regulators approved June 1.

The challenges were filed to contest the state Agency for Health Care Administration’s decisions on license applications from Lee Health, HCA Healthcare, and Braden Clinic. The petitions seek formal hearings.

For residents of Estero and Ave Maria, where the hospitals would be built, the legal wrangling means delays and the potential of project approvals getting overturned or dropped.

Once an administrative judge has been assigned, the hearings must begin within six months and a continuation is only allowed when the judge finds extraordinary circumstances, according to state law. In general, hearings are held in Tallahassee. It is likely the petitions involving the Lee County projects will be consolidated.

The publicly operated Lee Health was approved for an 82-bed hospital at its Coconut Point outpatient campus in Estero. HCA’s 80-bed hospital was approved for a site near Corkscrew Road and U.S. 41. Ten of the HCA beds would be for inpatient psychiatric care. Lee Health and HCA are fighting each other’s projects.

The state’s approval of both projects in the same region contrasts with its 2013 denial of Lee Health’s bid for an 80-bed hospital at Coconut Point.

The NCH Healthcare System and Physicians Regional Healthcare System, both in Collier County, are opposing the two Lee County projects.

NCH also is fighting the state’s approval of a 25-bed hospital by Braden Clinic in Ave Maria.

The challenges reiterate objections the competitors filed earlier this spring after the three applications were submitted. The objections say more beds will harm the existing hospitals, will result in higher health care costs, and will dilute the quality of care provided by health professionals.

The petitions also raise questions about whether the state properly balanced statutory criteria in evaluating the applications. The state may face greater scrutiny because it approved all three applications for Southwest Florida. The agency also green-lighted hospital projects in Marion, Volusia and Orange counties.

Nashville-based HCA Healthcare sold two hospitals in Fort Myers in 2006 to Lee Health. One was closed and the other, Gulf Coast Hospital, was expanded and renamed Gulf Coast Medical Center. In its argument against HCA aiming to re-enter the market, Lee Health says HCA “abandoned” the community in 2006.

Physicians Regional similarly said the monopoly that Lee Health has today is due in large part because HCA left the county in 2006. Physicians Regional said HCA should not be allowed to build a hospital and potentially divest again to the benefit of Lee Health.

In its objection to the Lee Health project, HCA said the abandonment argument is irrelevant and the issue is whether Lee Health should be permitted to expand its market dominance.

“The clear answer to this question is that Lee County residents should have the same degree of choice of inpatient providers as is available in other Florida counties and that enhanced competition will be beneficial to residents, the medical community, and payors of health care services,” HCA said.

Lee Health controls 95 percent of hospital beds in the county and handled 85 percent of all admissions, HCA said.

Lee Health spokeswoman Mary Briggs said the system’s project is the best choice for Estero.

“Our hospital will be built adjacent to Lee Health — Coconut Point, which opens later this year,” she said.  “An acute care bed tower will naturally complement the emergency room, surgery center and other comprehensive outpatient services to be offered at that location.”

In its opposition to the planned 25-bed Braden hospital, NCH said the rural hospital proposed off Arthrex Commerce Drive near Oil Well Road would face numerous challenges.

“The area remains a medically underserved area, lacking necessary support services as well as sufficient health care professionals,” NCH said. “That lack of support raises issues as to 24-hour staffing and adequate emergency coverage for a hospital, and the sustainability of a rural hospital with 25 beds.”

Braden Clinic opened outpatient services for Ave Maria in 2015. The hospital application included letters of support from 650 residents, community leaders and businesses.

NCH took issue with the hospital planning to have an emergency room, but the hospital would not offer inpatient surgery.

“The lack of inpatient surgery, when explicit statements occur as to full emergency care, overreaches as to the capability of the proposed hospital,” NCH said.

Financial documents included in Braden’s application said investors would be tapped to help build the $34.5 million hospital, or $1.4 million per bed. Braden clinic showed net revenues of $525,000, and a net loss of $86,000 at the end of 2017. NCH raised questions about whether investors would have a controlling role in the hospital.

Braden officials issued a statement that its project has widespread support and that a new hospital is overdue in the community. Supporters include Collier County’s Emergency Medical Services, the Healthcare Network of Southwest Florida, and the Collier County Rural Health Network, Braden said.

“Everyone knows that eastern Collier County is in dire need of a hospital that actually serves our patient base,” the statement reads. “The state healthcare administrative body has ruled in favor of our application. The community is supportive at every level.”

Braden officials said only NCH is challenging the new hospital based on its own financial interests.

“Shame on the powerful executives, lawyers, and governing bodies of NCH for suing the state of Florida in a sad attempt to protect their market share,” the statement reads.

Source: Naples Daily News