Tidewell Hospice has a monopoly on the market in Sarasota County, Florida—but promoting more competition is not a sufficient reason to allow another hospice to open there, according to a recent ruling from the First District Court of Appeal.
At issue is Florida’s certificate of need (CON) law. Like more than a dozen states across the nation, Florida requires hospices to receive a CON in order to operate. A certificate is only granted by the state’s Agency for Health Care Administration (AHCA) based on several factors, including whether there is unmet consumer need. Florida hospice law also states, “The formula on which the certificate of need is based shall discourage regional monopolies and promote competition.”
In Sarasota County, a monopoly does currently exist, as Tidewell is the sole hospice operator. Overall, Tidewell serves more than 1,100 patients each day across Sarasota, Manatee, Charlotte and DeSoto counties. The company’s administration office is located in the city of Sarasota.
Given Tidewell’s monopoly, another hospice provider—Compassionate Care Hospice (CCH) of the Gulf Coast—believes that it should be granted a CON to operate in Sarasota County. However, its application was rejected by AHCA, prompting Compassionate Care to take its case to the courts. Compassionate Care is based in Westampton, New Jersey, and serves more than 20 states across the country.
The appeals court has upheld AHCA’s denial, but Chief Judge Bradford L. Thomas and Judges Scott Makar and Thomas D. Winokur described their decision as a “close call.”
“ … The evidence establishes (and the hearing officer found) that Tidewell is a monopolist, that CCH’s entry into Sarasota County is economically viable and will increase competition, but that new competition will reduce Tidewell’s market share and result in an adverse financial impact on the incumbent with no clear showing of a specific unserved population,” they wrote in their May 25 ruling.
However, the CON law does not specify how criteria should be ranked; in other words, whether the mandate to discourage monopolies is more or less important than the presence of an underserved population, for example. Because of this, and the fact that AHCA did undertake a “balanced consideration of all relevant criteria” in order to put forward a “plausible” rationale for rejecting CCH’s application, the appeals court upheld the agency’s decision.
Attorneys representing Compassionate Care Hospice had not responded to inquiries from Home Health Care News as of press time.
Click here to read the full appeals court ruling.
Written by Tim Mullaney
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