Case Name: NME HOSPITALS, INC., d/b/a Delray Community Hospital and NME Hospitals, Inc., d/b/a West Boca Raton Medical Center, Appellants, v. DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES and Humana of Florida, Inc., d/b/a Women's Hospital of Boca Raton, Appellees; BETHESDA MEMORIAL HOSPITAL, Boca Raton Community Hospital and St. Mary's Hospital, Appellants, v. DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES, and Humana of Florida, Inc., d/b/a Women's Hospital of Boca Raton, Appellees
Court: Florida District Court of Appeal
Jurisdiction: Florida
Decision Date: 1985-08-20
Citations: 492 So. 2d 379
Docket Number: Nos. BC-311, BC-323
Parties: NME HOSPITALS, INC., d/b/a Delray Community Hospital and NME Hospitals, Inc., d/b/a West Boca Raton Medical Center, Appellants, v. DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES and Humana of Florida, Inc., d/b/a Women’s Hospital of Boca Raton, Appellees. BETHESDA MEMORIAL HOSPITAL, Boca Raton Community Hospital and St. Mary’s Hospital, Appellants, v. DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES, and Humana of Florida, Inc., d/b/a Women’s Hospital of Boca Raton, Appellees.
Judges: SHIVERS and JOANOS, JJ., concur.
Reporter: Southern Reporter, Second Series
Volume: 492
Pages: 379–388

Head Matter:
NME HOSPITALS, INC., d/b/a Delray Community Hospital and NME Hospitals, Inc., d/b/a West Boca Raton Medical Center, Appellants, v. DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES and Humana of Florida, Inc., d/b/a Women’s Hospital of Boca Raton, Appellees. BETHESDA MEMORIAL HOSPITAL, Boca Raton Community Hospital and St. Mary’s Hospital, Appellants, v. DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES, and Humana of Florida, Inc., d/b/a Women’s Hospital of Boca Raton, Appellees.
Nos. BC-311, BC-323.
District Court of Appeal of Florida, First District.
Opinion Aug. 20, 1985.
Opinion on Motion for Rehearing June 24, 1986.
Rehearing Denied July 23, 1986.
C. Gary Williams & Michael Glazer of Ausley, McMullen, McGehee, Carothers & Proctor, Tallahassee, for appellants in No. BC-311.
Kenneth F. Hoffman & Martha J. Eden-field of Oertel & Hoffman, Tallahassee, for appellants in No. BC-323.
Jay Adams, Deputy Gen. Counsel, Dept, of Health and Rehabilitative Services, Tallahassee, for appellees in No. BC-311.
John H. French, Jr. & James C. Hauser of Messer, Rhodes & Vickers, Tallahassee, for appellees in No. BC-323.

Opinion:
ERVIN, Judge.
Appellants in these consolidated cases appeal from a final order of the Department of Health and Rehabilitative Services (HRS), denying their petitions for section 120.57(1) hearings. We affirm.
In November 1982, appellee Humana applied to HRS for a certificate of need (CON) to build a 120-bed women's hospital in Palm Beach County. In the January 21, 1983 issue of the Florida Administrative Weekly, HRS published notice that Huma-na's application was complete and informed affected persons of their right to timely request a hearing on the application. Fla. Admin.Code Rule 10-5.10. HRS denied Humana's application and published notice of the denial in the March 11, 1983 issue of the Florida Administrative Weekly. Hu-mana next sought a section 120.57(1) hearing to challenge the denial. HRS did not give notice to any affected persons of Hu-mana's request for a hearing or of the fact that a hearing was scheduled or held. On June 20-23, 1983, a final administrative hearing was held regarding the denial of Humana's application. A joint pre-hearing stipulation had identified only one disputed issue: need. No hospital or other person petitioned to intervene before the June 1983 hearing.
After the hearing, but before the hearing officer issued a recommended order, HRS and Humana entered into a stipulation and agreement whereby HRS agreed to issue Humana a CON to construct a 120-bed women's hospital in Palm Beach County. The stipulation and agreement, entered pursuant to Section 120.57(3), Florida Statutes, states that the "extensive factual record" from the June 1983 hearing "in part, provides the predicate for this Stipulation", and continues that "[n]o person or entity which may be substantially affected by the approval of the proposed facility sought to intervene in the proceeding prior to hearing despite the clear point of entry afforded by Section 381.494(8)(e), Florida Statutes, and Rule 10-5.10(8)". The stipulation and agreement also states:
DHRS agrees that the Final Order resulting from this Stipulation constitutes final agency action which is not subject to review pursuant to Section 120.57, Florida Statutes. DHRS finds that the clear point of entry for persons whose interests may be affected by the issuance or denial of Humana's application occurred prior to the administrative hearing in this cause per Section 381.494(8)(c), Florida Statutes, and Rule 10-5.10(7), Florida Administrative Code.
Based on the stipulation and agreement and a joint motion requesting remand of the case to HRS for appropriate action, the hearing officer closed his file and returned the case to HRS. On August 16, 1984, HRS entered a final order adopting the stipulation and agreement and approving the issuance of the CON to Humana. Later on that same day, the appellants in case number BC-323 now before this court filed a "Petition for Formal Administrative Hearing" concerning the approval of Hu-mana's CON. On the next day, August 17, 1984, the appellants in case number BC-311 filed a similar petition. All of the appellants are existing hospitals in Palm Beach County.
The final order on appeal before us, dismissing the petitions filed by both groups of appellants, states that the issue is whether the August 16, 1984 order is preliminary free-form agency action subject to administrative review, or final agency action subject only to judicial review. The order concludes that (1) appellants, as proper but not necessary or indispensable parties, had a point of entry into the administrative process by way of intervention prior to the final hearing; (2) the stipulation and final order did not precede or take the place of a formal administrative, evidentiary hearing, but rather were the result of that hearing; and (3) the final order constitutes final agency action, and is not subject to further administrative review.
There is no dispute that appellants, as hospitals in the same HRS service district as Humana's planned facility, are substantially affected by the decision to grant a CON to Humana. See Fla.Admin. Code Rule 10-5.02(20). Contrast, Community Psychiatric Centers, Inc. v. Department of Health and Rehabilitative Services, 474 So.2d 870 (Fla. 1st DCA 1985) (applicant who filed application for CON could not seek comparative review of its application with that of applicant who had filed for CON four batching cycles earlier, because later applicant could not be considered substantially affected within meaning of the rule). Substantially affected persons have a right to seek relief under the Administrative Procedure Act from a HRS decision granting or denying a CON. The only question before us is whether appellants timely exercised such right and, if not, then whether that right may be considered to have been waived. Before one may properly exercise a right, such person must be afforded notice, or a point of entry into the administrative proceeding. See § 381.-494(8)(e), Fla.Stat. (Supp.1982); Fla.Admin. Code Rule 10-5.10(8). We must first decide whether HRS provided appellants with the required "clear point of entry, within a specified time period after some recognizable event in investigatory or other free-form proceedings, to formal or informal proceedings under Section 120.57." Capeletti Brothers, Inc. v. State, Department of Transportation, 362 So.2d 346, 348 (Fla. 1st DCA 1978). HRS argues that appellants had a clear point of entry upon notice of the initial denial of Humana's CON application and before the June 1983 administrative hearing. HRS concludes that because appellants neither petitioned for a 120.57(1) hearing, nor sought to intervene, pursuant to Rule 28-5.207, in the formal administrative review requested by Huma-na, appellants have waived their right to administrative review.
We agree with HRS for two basic reasons: First, no statute or administrative rule, during the applicable time frame here involved, required HRS to publish notice of a party's request for an administrative hearing concerning a CON decision. Sec ond, as a practical matter, we do not consider the notice of preliminary denial "so remote from the agency action as to be ineffectual as a vehicle for affording" appellants "a prompt opportunity to challenge disputed issues of material fact in a 120.57 hearing." General Development Utilities, Inc. v. Florida Department of Environment Regulation, 417 So.2d 1068, 1070 (Fla. 1st DCA 1982). The published notice of the initial denial of Humana's application informed all substantially affected persons, including appellants, that the aggrieved applicant had the right to request an administrative hearing within 30 days of publication of the notice. See Fla.Admin.Code Rule 10-5.10(8). Contrast Henry v. State, Department of Administration, Division of Retirement, 431 So.2d 677 (Fla. 1st DCA 1983) (no clear point of entry afforded affected person of his right to request hearing, resulting from agency's denial of benefits, because notice of denial did not inform such person of the time limitation in which to seek review). A diligent, substantially affected person should have inquired, after the 30-day period had expired, regarding whether Humana had filed such a request; and, if Humana had, then any person who would be substantially affected by later administrative action on the request could then have sought timely intervention in the ongoing proceeding. Indeed, such action has been taken in other cases by persons who would be adversely affected by any later decision to grant a CON to an applicant that had requested a hearing following an initial denial of its application. In fact, the record discloses that in other cases some of the instant appellants had previously filed timely petitions to intervene in opposition to requested CON applications, wherein HRS had initially denied said applications and the applicants had then sought 120.57 hearings. Under these circumstances, we conclude that appellants did not avail themselves of their "point of entry" into the administrative proceedings, i.e., via a Rule 28-5.207 motion to intervene, requiring that "[p]ersons other than the original parties to a pending proceeding who have a substantial interest in the proceeding," must file a petition to intervene at least five days before the final hearing.
We next decide whether appellants' failure to utilize the point of entry afforded them constitutes a waiver of their right to a 120.57 hearing. As stated above, the only agency action of which appellants received notice was the preliminary denial of Humana's application, a decision not contested by appellants. In Doheny v. Grove Isle, Ltd., 442 So.2d 966, 976 (Fla. 1st DCA 1983), this court observed that under similar circumstances, a party "could not be expected to have filed a request for a Chapter 120 hearing". In Doheny, however, the party did not waive his section 120.57 rights since he had timely intervened pursuant to Rule 28-5.207 before the final hearing. Id. at 977. In the case at bar, appellants' failure to intervene in Huma-na's requested review reflects a waiver of their 120.57 rights.
Since appellants must be considered to have waived their rights, even if the stipulation and agreement entered into by HRS was merely free-form action, we agree that action is not subject to the 120.57 review process. Capeletti Brothers, 362 So.2d at 348-49. Though the hearing officer never entered a recommended order, there is no authority requiring the entry of such order for final agency action. Section 120.57(3) authorizes "informal disposition . of any proceeding by stipulation, agreed settlement, or consent order." Under the circumstances in which the agency itself is a party to the stipulation entered into, and there are at that time no parties contesting the application, section 120.57 cannot be considered as authority for requiring the entry of a hearing officer's recommended order to be reviewed by the same agency that has previously consented to the terms of the agreement.
Additionally, we distinguish Florida Convalescent Centers, Inc. v. Department of Health and Rehabilitative Services, 445 So.2d 631 (Fla. 1st DCA 1984), from the case at bar. In Florida Convalescent, two CON applications in the same batching cycle were denied. After both applicants had requested formal proceedings on their respective applications under section 120.-57(1), appellant sought to intervene in the formal proceeding that had been requested by the other applicant. Thereafter, the second applicant entered into a stipulation with HRS, stating that if the second applicant would agree to abandon its request for a 120.57 hearing, HRS in turn would grant its request for a CON. Appellant then filed a petition for hearing under section 120.57(1), asking that the CON not be granted until HRS first conducted a comprehensive review of all competing applications. This court found that the stipulation in question was "the equivalent of the free-form action involved in Capeletti", and concluded that appellant "has not waived the benefits of Section 120.57 but has properly requested them." 445 So.2d at 633. Florida Convalescent is distinguishable from the case at bar on the following grounds: (1) The parties were competing applicants in the same batching cycle; and (2) the appellant in Florida Convalescent timely intervened in the formal proceeding requested by the other applicant. Finally, the presence of CON applicants competing for a fixed pool of beds in Gulf Court Nursing Center v. Department of Health and Rehabilitative Services, 483 So.2d 700 (Fla. 1st DCA 1985), a comparative review case, distinguishes the facts there from those in the case at bar. In Gulf Court, notice of the initial denial of the appellees' CON applications could not have afforded the appellant a clear "point of entry", because such notice pertained only to a pool of units, that had been fixed prior to the time of appellant's application. Moreover, there was nothing in the initial denial that could conceivably have placed appellant on notice that the parties would agree that the earlier applicants would be granted CONs involving the later fixed pool to which appellant's application pertained.
AFFIRMED.
SHIVERS and JOANOS, JJ., concur.
. The notice stated:
On February 25, 1983, Certificate of Need No. 2442 was denied Humana-Women's Hospital for a 100-bed women's specialty hospital in South Palm Beach, Palm Beach County.
Persons whose substantial interests are affected by the above decisions may request an administrative hearing within 30 days of publication of this notice pursuant to procedural rules contained in Chapter 10-2, F.A.C.
10 Florida Administrative Weekly 584 (March 11, 1983).
. Section 381.494(8)(e), Florida Statutes (Supp. 1982), provides:
An applicant or a substantially affected person who is aggrieved by the issuance, revocation, or denial of a certificate of need shall have the right, within not more than 30 days from the day of notice of the issuance, revocation, or denial of such certificate by the department, to seek relief according to the provisions of the Administrative Procedure Act and to seek judicial review of decisions resulting from hearings under the Administrative Procedure Act. In such judicial review, the court must affirm the decision of the department unless the decision is found to be arbitrary, capricious, or not in compliance with this act.
. Rule 10-5.10(8) states:
An applicant aggrieved by a department decision to deny a Certificate of Need for a project in total or for an identifiable portion of the total project; an HSA aggrieved by a department decision contrary to HSA recommendations relative to issuance or denial of a Certificate of Need; or persons whose interests are substantially affected by a department decision to issue or deny a Certificate of Need shall have the right of appeal and to demand a fair hearing under the provisions of the Administrative Procedure Act (Chapter 120, Florida Statutes). Any such appeals must be in writing and be received by the department within 30 days of the date the applicant, substantially affected person and HSA receive written notice of the department action. Publication of Notice of the issuance or denial of a Certificate of Need in the Florida Administrative Weekly shall constitute receipt of written notice.
.Our research indicates that starting with the April 13, 1984 issue of the Florida Administrative Weekly, HRS now gives published notice of requests for administrative hearings on CON decisions. The following statements precede the notices:
Resolution of these requests for hearing will determine substantial interests of the parties and may determine the substantial interests of non-parties. Those whose substantial interests will or may be determined by these proceedings are advised to govern themselves accordingly.
The point of entry thus established by the revised procedure now clearly places all substantially affected persons on notice that a hearing has been requested, and that they may ignore the request only at their own peril.
. Those motions to intervene were filed before HRS began the practice discussed in footnote 4.