Court Opinion

ID: 9378263
Source: CourtListenerOpinion
Date Created: 2023-03-09 20:11:56.709902+00
Date Added: 2024-06-11T17:17:19.848122
License: Public Domain

IN THE INTERMEDIATE COURT OF APPEALS OF WEST VIRGINIA

MINNIE HAMILTON HEALTH CARE CENTER, INC., d/b/a MINNIE
HAMILTON HEALTH SYSTEM,                            FILED
Respondent Below, Petitioner
                                                                                March 9, 2023
vs.) No. 22-ICA-149 (CON File No. 21-5-12124-P)                                    released at 3:00 p.m.
                                                                               EDYTHE NASH GAISER, CLERK
                                                                             INTERMEDIATE COURT OF APPEALS

HOSPITAL DEVELOPMENT CO., d/b/a ROANE GENERAL HOSPITAL,                            OF WEST VIRGINIA

Applicant Below, Respondent

and

WEST VIRGINIA HEALTH CARE AUTHORITY,
Respondent

                            MEMORANDUM DECISION

        Minnie Hamilton Health Care Center, Inc. dba Minnie Hamilton Health System
(“Minnie Hamilton”) appeals an April 29, 2022, West Virginia Health Care Authority (the
“Authority”) decision granting Hospital Development Co. dba Roane General Hospital
(“Roane General”) a Certificate of Need (“CON”) authorizing it to relocate a rural health
clinic from its main campus to a new site in Arnoldsburg, Calhoun County, West Virginia. 1
Respondents filed a timely response. Minnie Hamilton filed a reply.

       This Court has jurisdiction over this appeal pursuant to West Virginia Code § 51-
11-4 (2022). After considering the parties’ written and oral arguments, the record on
appeal, and the applicable law, this Court finds no substantial question of law and no
prejudicial error. For these reasons, a memorandum decision affirming the Authority’s
order is appropriate under Rule 21 of the Rules of Appellate Procedure.

       Roane General is a hospital with its main campus located in Spencer, Roane County,
West Virginia. In addition to hospital services, Roane General operates four rural health
centers (“RHCs”), two located at the hospital’s main campus and two located off-campus.
On July 30, 2021, Roane General completed an application for a CON, proposing a plan to

      1
        Petitioner is represented by Robert L. Coffield, Esq. and Caleb P. Knight, Esq.
Respondent Roane General is represented by Alaina N. Crislip, Esq. Respondent West
Virginia Health Care Authority is represented by Katherine A. Campbell, Esq.

                                            1
relocate one of the on-campus clinics to a site in Arnoldsburg, Calhoun County, West
Virginia. The proposed relocation project would establish a new ambulatory care center
with an expected capital expenditure of $439,720. In its application, Roane General’s stated
objectives are to improve the ability of Arnoldsburg, Chloe, and Orma, West Virginia (the
“service area”) residents to access primary care, cardiology, and general surgery services.

        On August 26, 2021, Minnie Hamilton requested an administrative hearing before
the Authority to contest Roane General’s application. Minnie Hamilton operates a critical
access hospital in Grantsville, Calhoun County, West Virginia, as well as a school-based
clinic in Arnoldsburg. 2

       On December 1, 2021, Minnie Hamilton filed a motion to compel, requesting access
to records relied upon by Roane General’s population methodology expert witness in
preparing its CON. At a December 7, 2021, prehearing conference, the Authority denied
the motion to compel; nevertheless, a number of records were disclosed by Roane General.

       The Authority held a public hearing on December 14, 2021, regarding Roane
General’s CON application. Roane General and Minnie Hamilton presented documentary
evidence and testimony. During the hearing, one of Roane General’s experts provided
testimony regarding the service area’s population, which encompasses multiple zip codes
in Calhoun County. Minnie Hamilton disputed the sufficiency of Roane General’s
population calculations, arguing the calculations were based on flawed data.

       Roane General also presented evidence of the service area’s need for additional
primary care, cardiology, and general surgery services. Again, Minnie Hamilton disagreed,
arguing that Roane General failed to adequately assess the number of providers in the
service area and failed to account for Minnie Hamilton’s Grantsville hospital and other
Calhoun County clinics.

       Additionally, Roane General provided financial projections to establish the
proposed RHC’s financial viability and adequate staffing. However, Minnie Hamilton
argued that Roane General’s projections were based upon an inflated patient encounter rate
and that the proposed project would be financially unfeasible. Minnie Hamilton reasoned
that this alleged financial hardship would cause the project to fail to meet staffing
requirements.

       On April 29, 2022, the Authority issued a written decision granting Roane General’s
CON application, addressing each contested point in a detailed manner. The Authority’s
decision adopted Roane General’s zip code population methodology as credible, finding

       2
        On September 13, 2021, Minnie Hamilton filed its own CON application to open
a new primary care center in Arnoldsburg, which is still pending.

                                             2
that it rationally and objectively reflected the patient base for the proposed RHC. Further,
the Authority found the service area had an unmet need for further health care providers,
rejecting Minnie Hamilton’s arguments that Roane General failed to account for other
providers within Calhoun County. The Authority determined that providers identified by
Minnie Hamilton were properly excluded from Roane General’s calculations because they
were: (1) outside the service area; (2) not providing services to the general public; or (3)
not an existing provider when the CON application was filed. Additionally, the Authority
concluded that Roane General’s financial projections were sufficient to establish financial
viability and adequate staffing, dismissing Minnie Hamilton’s protests as speculative.

      On May 25, 2022, Minnie Hamilton filed a request for review with the Office of
Judges, which we consider in this appeal. 3

       “The specific standard of review both for the Office of Judges and, on appeal
therefrom . . . is set forth in West Virginia Code § 29A-5-4(g).” Amedisys W. Va., LLC v.
Pers. Touch Home Care of W. Va., Inc., 245 W. Va. 398, 407, 859 S.E.2d 341, 350 (2021).
West Virginia Code § 29A-5-4(g) (2021) provides:

       The court may affirm the order or decision of the agency or remand the case
       for further proceedings. It shall reverse, vacate, or modify the order or
       decision of the agency if the substantial rights of the petitioner or petitioners
       have been prejudiced because the administrative findings, inferences,
       conclusions, decision, or order are:
       (1) In violation of constitutional or statutory provisions;
       (2) In excess of the statutory authority or jurisdiction of the agency;
       (3) Made upon unlawful procedures;
       (4) Affected by other error of law;
       (5) Clearly wrong in view of the reliable, probative, and substantial evidence
       on the whole record; or
       (6) Arbitrary or capricious or characterized by abuse of discretion or clearly
       unwarranted exercise of discretion.

Further, the factfinding determinations of an agency are entitled to deference unless clearly
wrong.

       [Where] an appellate court [is] charged with reviewing the decision of an
       administrative agency’s factfinder . . . the [appellate] court is required to

       3
         This case is an appeal where the decision of the Authority was entered prior to
June 30, 2022. However, because the Office of Judges did not decide this case prior to its
dissolution on September 30, 2022, it was transferred to this Court for decision pursuant to
West Virginia Code § 16-2D-16a(b) (2021).

                                              3
       accord deference to the hearing examiner’s findings of fact unless they are
       “[c]learly wrong in view of the reliable, probative, and substantial evidence
       on the whole record[.]”

W. Va. State Police v. Walker, 246 W. Va. 77, __, 866 S.E.2d 142, 149 (2021) (quoting W.
Va. Code § 29A-5-4(g)(5)); see also Syl. Pt. 1, Muscatell v. Cline, 196 W. Va. 588, 474
S.E.2d 518, (1996).

       The proposed relocation of Roane General’s RHC is subject to the Authority’s CON
review process. 4 See W. Va. Code § 16-2D-3(a)(1) (2017). A CON may be issued if the
proposed service is “[f]ound to be needed; and . . . [c]onsistent with the state health plan,
unless there are emergency circumstances that pose a threat to public health.” W. Va. Code
§ 16-2D-12(a)(1)-(2) (2016). Different types of health services have different criteria that
must be met, per the State Health Plan Standards, to qualify for a CON. See W. Va. Code
§ 16-2D-12(g). In the instant case, Roane General’s proposed RHC is an ambulatory care
center, so the Ambulatory Care Center Standards are at issue.

        The Standards require proposed ambulatory care facilities to demonstrate: (1) a
methodology to calculate the service area’s unmet need for further medical providers, (2)
that the proposed facility will not negatively impact other services or providers, (3) that the
proposed services are the most cost effective alternative, (4) that the proposed services
maintain compliance with applicable accreditation standards, (5) that the project is
financially viable, (5) that the facility will be accessible to patients who lack adequate
transportation, and (6) that less expensive alternatives to new construction have been
considered. 5

        In its brief, Minnie Hamilton presents two arguments; we will address each in turn.
Minnie Hamilton contends that the Authority’s order was (1) insufficient in explaining the
Authority’s reasoning for its conclusions regarding population calculations and financial
viability of the project, and (2) erroneous because the population calculations used to
support Roane General’s application were based upon questionable estimates.

       4
         The Authority is named as a respondent in this matter and filed a brief. Because
the Authority takes the same positions as Roane General on the issues, the Authority’s brief
will not be discussed separately.
       5
          See W. Va. Health Care Auth., CON Standards: Ambulatory Care Centers
Standards, (Oct. 5, 1992),
https://hca.wv.gov/certificateofneed/Documents/CON_Standards/Ambulatory_Care_Cent
ers_2_ASC.pdf.

                                              4
      West Virginia Code § 29A-5-3 (1964) requires that an agency in a contested case
must articulate its findings and reasoning for review, providing in relevant part that:

       Every final order or decision rendered by any agency in a contested case shall
       be in writing or stated in the record and shall be accompanied by findings of
       fact and conclusions of law. . . . Findings of fact, if set forth in statutory
       language, shall be accompanied by a concise and explicit statement of the
       underlying facts supporting the findings.

The Supreme Court of Appeals of West Virginia has elaborated on the level of detail
required in an agency’s decision:

       [W]ith respect to decisions of administrative agencies following from
       findings of fact and conclusions of law proposed by opposing parties, . . . the
       agency must rule on the issues raised by the opposing parties with sufficient
       clarity to assure a reviewing court that all those findings have been
       considered and dealt with, not overlooked or concealed.

Muscatell, 196 W. Va. at 598, 474 S.E.2d at 528.

        Upon review, we find that Minnie Hamilton’s argument disputing the sufficiency of
the decision is unpersuasive. The Authority issued a detailed fifty-four page decision,
setting out the parties’ opposing positions on each contested issue that substantively
addressed Minnie Hamilton’s arguments at every turn. For example, in addressing the
project’s financial outlook, Minnie Hamilton argued that Roane General’s similar clinics
were operating significantly in the red, thus questioning the project’s financial feasibility.
In its decision, the Authority addressed the shortcomings of Minnie Hamilton’s position:

       [Minnie Hamilton] also appears to misunderstand the difference between
       RHC “collections” and “reimbursement,” and therefore, misapprehends a
       fundamental and critical distinction as it related to the project’s financial
       feasibility . . . [testimony explains] that these financial documents encompass
       the margin based upon costs versus expenses, and not reimbursement versus
       expenses . . . the financial documents cited by Minnie Hamilton are not
       instructive as to the financial feasibility of the project, as they do not fairly
       and accurately depict the financial performance of [Roane General]’s
       [clinics]. (Emphasis added).

Subsequently, the Authority found, and we concur, that Roane General met its burden of
demonstrating financial feasibility.

      Next, we find that the Authority, in its April 29, 2022, decision, sufficiently
addressed Minnie Hamilton’s concerns regarding the population methodology. The

                                              5
Authority explicitly accepted Roane General’s use of zip code-specific population data as
an interpretative tool to decipher the Authority-provided county-wide population data. The
Authority reasoned:

       The Authority rejects [Minnie Hamilton’s] inference that the application's
       population analysis is flawed because the zip code reference was not
       specifically identified as a source in the application. The zip code reference
       was utilized to break down the provided population data by zip code, since
       zip code-specific population percentages are not provided. . . . Thus, the
       existence/identity of [the] zip code reference, as well as the rationale for its
       use to interpolate the Authority provided population data, was fully
       established in the record for consideration.

Further, the Authority cited three past CON applications where it had approved the use of
zip code specific data, highlighting it as an accepted practice. 6

      We find that the Authority’s decision satisfies the requirements of West Virginia
Code § 29A-5-3, as it demonstrates consideration of each of the parties’ positions, the
evidence, and sufficiently sets forth the reasoning and analysis underpinning the
Authority’s conclusions. We find no error in the Authority’s April 29, 2022, decision.
Accordingly, we affirm.

                                                                                   Affirmed.

ISSUED: March 9, 2023

CONCURRED IN BY:

Chief Judge Daniel W. Greear
Judge Thomas E. Scarr
Judge Charles O. Lorensen

       6
         Ancillary to this argument, Minnie Hamilton claims the Authority’s denial of its
motion to compel left it unable to properly challenge Roane General’s population data. We
disagree. The record reflects that Minnie Hamilton had an opportunity to cross examine
Roane General’s expert at the hearing and to present its own evidence. In addition, we
conclude that, because the remaining evidence was “independently sufficient” to support
the findings of fact, any technical evidentiary or discovery error by the Authority was
harmless. See Stephens v. Rakes, 235 W. Va. 555, 573, 775 S.E.2d 107, 125 (2015) (quoting
McDougal v. McCammon, 193 W.Va. 229, 239, 455 S.E.2d 788, 798 (1995)) (explaining
that an evidentiary error is harmless if there is a separate evidentiary basis to support the
verdict, so long as the verdict was not substantially influenced by the error).

                                              6