Opinion ID: 2132355
Heading Depth: 1
Heading Rank: 1

Heading: The Hotel Floors.

Text: In its application for a determination of need, the hospital disclosed its intention to build four hotel floors, but gave no further details, stating that those floors will be treated as a separate project, with funding outside the scope of this application. The department acquiesced. The plaintiffs argue that the exclusion of the hotel floors from the determination of need process was improper. We do not agree. General Laws c. 111, § 25C (1984 ed.), provides in pertinent part: Notwithstanding any contrary provisions of law ... no person or agency of the commonwealth ... shall make substantial capital expenditures for construction of a health care facility or substantially change the service of such facility unless there is a determination by the department that there is need therefor. A health care facility is defined in § 25B as a hospital ... and any part of such facilit[y]. In Brookline v. Medical Area Serv. Corp., 8 Mass. App. Ct. 243, 255 (1979), the court ruled that an energy plant physically separate from health care facilities, providing a significant amount of service to nonhealth care facilities, constructed, leased, and operated by corporations which were not health care facilities, and financed by a nonhealth care facility, did not require a determination of need. The court interpreted the scope of G.L.c. 111, §§ 25B-25G, to include within the determination of need process as part of a health care facility only projects which bear a substantial nexus to health care institutions. The court announced that the nexus must arise from some combination of functional, legal, administrative, and operational ties between the project and the institutions that leads to the conclusion that it is an integral part of the institutions it services. Id. at 254. In Brookline, the court also relied on the well established principle that while an administrative or executive interpretation cannot bind the courts, weight should be given to any reasonable construction of a regulatory statute adopted by the agency charged with its enforcement. Id. at 258. In enacting the determination of need statute, the Legislature intended the department to have a major role in defining the contours of the statute, and in considering its applicability on an ad hoc basis to projects that did not fit traditional norms. Id. at 254. Accordingly, courts must give deference to the department's determination whether a project is legally, administratively, financially, physically, and, in terms of its services, so intertwined with the particular facility that it would be appropriate to view it functionally as part of the health care facility. Brookline, supra at 256. See Howe v. Health Facilities Appeals Bd., 20 Mass. App. Ct. 531, 537 n. 6 (1985); Shoolman v. Health Facilities Appeals Bd., 10 Mass. App. Ct. 799, 806 (1980). The department's decision that the hotel floors would not be subject to determination of need procedures was not only consistent with the Appeals Court's holding and rationale in Brookline, supra, but it was also consistent with its own previous decisions in unrelated but similar cases which have been brought to our attention. The department rationally and consistent with its prior determinations could have determined that the hotel floors bore an insufficient nexus to the hospital to require determination of need review. The department heard testimony that the hotel facility would be used by patients prior to their admittance to and after their discharge from the facility and by individuals wishing to stay near the hospital when a family member is admitted. In its recommendation to the department, the department staff expressed satisfaction that no cost of the hotel will be reflected in patient care costs. Further, in the hearing before the department, the department solicited testimony which assured it that if the hotel were constructed, there would be a separate corporation, so there's no question about transferring costs. Finally, the hospital's request for a determination of need was approved with the condition that no hospital internal funds shall be used for construction or operation of the hotel, [and] no costs of the hotel will be reflected in patient care costs. The plaintiffs argue that [a]ny possible doubt about the necessity for determination of need review of the hotel floors is resolved by certain statements made subsequent to the determination of need hearing by hospital representatives in the course of a zoning case in the Superior Court. The representatives stated that the floors constitute a hospital in every sense of the word, and that they are an integral part of the hospital's unified facility. We reject the plaintiffs' argument for two reasons, either of which is sufficient. General Laws c. 111, § 25E, empowers the Health Facilities Appeals Board to look beyond the materials in the record before the department only if the board determines that the materials before it are inadequate. No such determination was made here or required. Furthermore, in light of the differences between the objectives of determinations of need and the objectives of zoning, there is no inconsistency between not viewing the hotel as the hospital for determination of need purposes, but viewing it as sufficiently related to the hospital to be an allowed use under the Boston Zoning Code. See Pellegrino v. City Council of Springfield, 22 Mass. App. Ct. 459, 464 (1986).