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Proposed Florida Health Rules Scrapped After Hospital Challenges

After facing nearly a dozen challenges from hospitals across the state, Gov. Ron DeSantis’ administration has withdrawn a series of proposed rules related to regulating highly specialized health-care services.

The state Agency for Health Care Administration announced this week it planned to employ a rarely used option called “negotiated rulemaking” to try to reach a compromise on one of the withdrawn proposals, a regulation that would set licensure standards for neonatal intensive-care units.

The proposed rule drew challenges from Tampa General Hospital and the North Broward Hospital District, whose president and chief executive officer is Shane Strum, DeSantis’ former chief of staff.

Two days after the proposed rule was withdrawn, a state administrative law judge dismissed the hospitals’ administrative complaints as moot. The Agency for Health Care Administration did not respond to The News Service of Florida’s requests for comment.

It’s not clear whether the agency also will rely on negotiated rulemaking to reach compromises on five other proposed regulations it withdrew this week, including proposed rules to set licensure standards for hospital-based pediatric cardiac care; comprehensive rehabilitation; substance abuse; and psychiatric programs.

Though it’s rarely used, Florida law allows agencies to enter into a negotiated rulemaking process “when complex rules are being drafted or strong opposition to the rules is anticipated.”

Under the process, the agency is required to appoint a “committee of interested persons” and to publicly post the list of representatives. Anyone who is not invited to serve on the committee who feels like their interests aren’t represented has 30 days to apply to participate. The committee must be chaired by a neutral party, and its meetings must be publicly noticed.

While a negotiating committee is expected to find agreement on a “mutually acceptable rule,” there is no requirement that the agency support the committee proposal.

The Florida Health Care Association requested the use of the process in 2017 when then-Gov. Rick Scott’s administration pushed to require all nursing homes and assisted living facilities to have emergency generators and fuel on site. Scott started the push after Hurricane Irma knocked out the air-conditioning system at The Rehabilitation Center at Hollywood Hills, a Broward County nursing home. Authorities attributed as many as 12 resident deaths to sweltering conditions in the building.

Bob Asztalos, a former lobbyist for the Florida Health Care Association, told the News Service that the association sent a written request to AHCA asking for negotiated rulemaking but was denied.

Ultimately, though, the nursing-home association met with the agency and other industry interests to hammer out controversial rules that required legislative ratification. The negotiations were behind closed doors.

Former AHCA Secretary Justin Senior recalled that the negotiations were difficult, even though the long term care providers had a unified position on the rules.

Hospitals, however, aren’t banded together on the proposed rule about neonatal intensive-care units that is set to be negotiated.

While Tampa General Hospital and the North Broward Hospital District, which operates as Broward Health, challenged the proposed rule, Palmetto General Hospital, Orange Park Medical Center and North Shore Medical Center supported the proposal and intervened in the legal case on behalf of the state.

AHCA proposed the series of new licensure rules after the Repubican-led Legislature eliminated the longtime “certificate of need” regulatory process for hospitals.

Under certificate of need, state regulators needed to give approval before hospitals could build or expand facilities or offer new services. Proponents of the regulatory process argued that preventing unnecessary expansion of services would help contain health-care costs and improve quality of care.

But many Republican legislators maintained that the requirements stifled competition and created monopolies in the hospital industry. After more than two decades of unsuccessful attempts to scrap the so-called CON process, then-House Speaker Jose Oliva, R-Miami Lakes, made the issue a priority in 2019 and shepherded a repeal of the requirements for hospitals, rehabilitation beds and tertiary services.

Signed into law by DeSantis in May 2019, the legislation made clear that until new rules are formally adopted, standards in existing rules remained in effect for comprehensive medical rehabilitation beds; neonatal intensive care units; and heart, liver, kidney, lung, pancreas, islet cell and intestine transplant programs.

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