ORDERS:
ORDER OF DISMISSAL AND REMAND
In
the above-captioned matter, on May 5, 2005, Petitioner Oncology and Hematology
Associates of South Carolina, LLC, d/b/a Cancer Centers of the Carolinas (CCC),
requested a contested case before this tribunal to challenge the decision of
Respondent South Carolina Department of Health and Environmental Control (DHEC
or Department) to issue a Certificate of Need (CON) to Respondent Bon
Secours-St. Francis Health System, Inc. (St. Francis) for the purchase and
installation of a Cyberknife Stereotactic Radiosurgery System at its St.
Francis Hospital in Greenville, South Carolina. In addition to its request for
a contested case, Petitioner CCC also moved for a stay, writ of mandamus,
injunction, remand, and other appropriate relief by motions filed on May 6 and
May 9, 2005, and amended on May 18, May 26, and June 16, 2005. On May 19,
2005, the Department filed both a response to Petitioner’s motions and a motion
to dismiss. In its motion to dismiss, the Department contends that Petitioner
failed to timely file its request for a contested case to challenge the
Department’s decision on St. Francis’ CON application and thus failed to
properly invoke this Court’s jurisdiction. Respondent St. Francis joined in
DHEC’s motion to dismiss.
A
conference call on Petitioner’s requests for injunctive relief was conducted
between the Court and the parties on May 26, 2005, and a motions hearing on
DHEC’s motion to dismiss was held before this Court on June 22, 2005. Based
upon the motions and attached exhibits filed by the parties, upon the arguments
of counsel presented to this tribunal, and upon the applicable law, I find that
DHEC’s motion to dismiss must be denied and this matter should be remanded to
the Department for it to reissue its decision on St. Francis’ CON application
with proper notice to affected persons.
BACKGROUND
In
late 2004, Respondent St. Francis filed an application with the Department for
a CON authorizing the purchase and installation of a Cyberknife Stereotactic
Radiosurgery System at its St. Francis Hospital in Greenville, South Carolina.
Petitioner CCC opposed St. Francis’ CON application and participated in the
Department’s review of the application through written correspondence and by
appearing at a project review meeting regarding the application. See
Mem. in Supp. of DHEC’s Mot. to Dismiss, Exhibits E through H. Most of this
correspondence was signed by W. Larry Gluck, M.D., the president of CCC, and
was submitted on CCC letterhead that lists addresses for CCC’s nine offices in
Upstate South Carolina. Id. During this process, Petitioner CCC,
through Dawn Smith, its senior marketing specialist, submitted a letter to DHEC
on January 19, 2005, in which it requested, as a party affected by St. Francis’
proposed project, to be notified of the decision regarding St. Francis’ CON
application, and specifically asked that all documentation regarding the CON be
sent to its business office. Id., Exhibit L. The body of this letter,
in its entirety, read as follows:
As an affected party
of the Certificate of Need (CON) for Cyberknife technology in Greenville, SC,
CancerCenters of the Carolinas requests to be notified of the decision
regarding this CON.
Please submit any
documentation to the following address:
CancerCenters of
the Carolinas
Attn: Dawn Smith,
Senior Marketing Specialist
3 Butternut
Drive, Suite B
Greenville, SC
29605
Id. (bold
typeface in original). However, when the Department issued its decision to
grant St. Francis’ CON application, it did not mail or otherwise deliver notice
of that decision to Petitioner at its business office on Butternut Drive, as
requested by Ms. Smith in the January 19 letter, but instead mailed notice of
the decision to Dr. Gluck at Petitioner’s West Faris Road medical office at
Greenville Memorial Hospital. Id., Exhibits C and D.
The
Department’s notice to Petitioner CCC of the decision regarding St. Francis’
CON application was flawed in a number of respects. Most importantly, the
notice was not sent to the address to which Petitioner specifically and
explicitly requested that “any documentation” regarding the CON be sent, but
rather was mailed to another one of Petitioner’s medical offices. Further,
while it was not unreasonable for the Department to address the letter to Dr.
Gluck, the president of CCC and CCC’s primary representative during the CON
review process, there is no indication in the exhibits or affidavits submitted
in this matter that Dr. Gluck or any other CCC physicians received business
correspondence at the medical office on West Faris Road at Greenville Memorial
Hospital. Finally, DHEC’s notice letter to Dr. Gluck incorrectly stated the
address for CCC’s West Faris Road office as “900 Faris Road,” rather than “900 West
Faris Road,” and was not postmarked and placed in the mail until April 22,
2005, one day after the decision was officially issued and one day after a
representative from St. Francis had picked up a copy of the decision from DHEC.
Because
of the delay caused by the flaws in the notice, Petitioner CCC did not file a
request for a contested case or a request for staff reconsideration of the CON
decision within ten days of St. Francis’ receipt of the Department’s decision.
Accordingly, by a letter dated May 3, 2005, the Department issued the
Certificate of Need to St. Francis.
DISCUSSION
Basic
principles of due process require that persons affected by a decision of an
administrative agency be given proper and adequate notice of the decision, so
that such persons may be heard regarding the decision before it becomes final.
See S.C. Const. art. I, § 22 (“No person shall be finally bound by a judicial
or quasi-judicial decision of an administrative agency affecting private rights
except on due notice and an opportunity to be heard . . . .”) (emphasis
added); Ross v. Med. Univ. of S.C., 328 S.C. 51, 492 S.E.2d 62 (1997)
(recognizing that the South Carolina Constitution guarantees the right to
notice and an opportunity to be heard by an administrative agency before a
final decision is rendered). Generally, this notice must be “reasonably
calculated under all circumstances to apprise interested parties of the
pendency of the action and afford them an opportunity to present their
objections.” Blanton v. Stathos, 351 S.C. 534, 542, 570 S.E.2d 565, 569
(Ct. App. 2002) (paraphrasing Mullane v. Cent. Hanover Bank & Trust Co.,
339 U.S. 306, 314 (1950)). In the case at hand, such notice is captured in the
CON statutes and regulations, which require that, once the Department reaches a
proposed decision on a CON application, “[n]otice of the proposed decision must
be sent to the applicant and affected persons who have asked to be notified.”
S.C. Code Ann. § 44-7-210(D) (2002); 24A S.C. Code Ann. Regs. 61-15, § 401
(Supp. 2004) (same). Thus, while an affected person’s time period for filing a
request for a contested case regarding a decision on a CON application runs
from the time the decision is received by the applicant, not by the affected
person, see S.C. Code Ann. § 44-7-210(D), both constitutional due
process guarantees and statutory and regulatory mandates require the Department
to provide legally sufficient notice of its decision on the application to
affected persons to afford them a full opportunity to be heard on the matter.
In
the instant case, the Department did not provide Petitioner CCC with adequate
notice of its proposed decision on St. Francis’ CON application prior to
issuing the CON. As discussed above, the notice mailed by DHEC to Petitioner
was deficient in a number of respects. Most critically, the Department failed
to mail Petitioner’s notice to the business office to which it had specifically
requested that such correspondence be sent, but instead sent the notice to a
separate medical office. Therefore, while some of
the Department’s technical errors in mailing the notice may have been excusable
in isolation, when all of the deficiencies in the notice are taken together, it
is plain that the Department failed to provide Petitioner CCC with notice
reasonably calculated, under all of the circumstances, to apprise Petitioner of
the Department’s proposed decision on St. Francis’ CON application prior to
issuing the CON to St. Francis. And, because the Department failed to comply
with constitutional, statutory, and regulatory notice requirements prior to
issuing the CON to St. Francis, this matter must be remanded to the Department
for it to void the CON and reissue its proposed decision on St. Francis’ CON
application with proper notice to Petitioner CCC and any other affected
persons.
ORDER
For
the reasons set forth above,
IT
IS HEREBY ORDERED that DHEC’s motion to dismiss this matter for lack of
jurisdiction is DENIED.
IT
IS FURTHER ORDERED that this matter is hereby REMANDED to the
Department for it to void the CON issued to St. Francis on May 3, 2005, vacate
its prior notification letter dated April 21, 2005, and issue a new notification
letter to St. Francis, CCC, and all other affected persons in compliance with
the provisions of S.C. Code Ann. § 44-7-210(D) and the accompanying
regulations. Further, all other alternative relief sought by Petitioner CCC is
denied in light of the remand ordered herein, and this case is DISMISSED.
AND
IT IS SO ORDERED.
______________________________
JOHN D.
GEATHERS
Administrative
Law Judge
June 28, 2005
Columbia, South Carolina |
