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Dimensions Medical Center v. Suburban Endoscopy Center

July 17, 1998

DIMENSIONS MEDICAL CENTER, LTD., ACCESS CENTER FOR HEALTH, LTD. AND ACCESS HEALTH CENTER, LTD., PLAINTIFFS-APPELLEES,
v.
SUBURBAN ENDOSCOPY CENTER, SUBURBAN ENDOSCOPY ASSOCIATES, INC., AN ILLINOIS CORPORATION, ENDOSCOPY CENTER AFFILIATES, INC., A DELAWARE CORPORATION, SHEA, PAIGE & ROGAL, INC., AN ILLINOIS CORPORATION, DEFENDANTS, AND ILLINOIS HEALTH FACILITIES PLANNING BOARD, JOHN LUMPKIN, M.D., DIRECTOR, AND ILLINOIS DEPARTMENT OF PUBLIC HEALTH, DEFENDANTS-APPELLANTS.



The opinion of the court was delivered by: Justice Hourihane

Appeal from the Circuit Court of Cook County.

No. 96 CH 2107

Honorable Dorothy Kinnaird, judge Presiding.

In February 1996, Suburban Endoscopy Center received approval from the Illinois Health Facilities Planning Board to begin operation of an ambulatory surgical treatment center, in Mount Prospect, dedicated solely to gastroenterological procedures. Plaintiffs Dimensions Medical Center, Ltd., Access Center for Health, Ltd. and Access Health Center, Ltd. filed a timely complaint for administrative review in the circuit court challenging the Planning Board's approval. Following a hearing, the circuit court reversed the decision of the Planning Board. On appeal, defendants Illinois Health Facilities Planning Board, John Lumpkin, M.D., Director, and Illinois Department of Public Health contend that (1) plaintiffs lacked standing to challenge the Planning Board's approval and (2) the circuit court erred in finding that the aforementioned approval was against the manifest weight of the evidence. For the reasons that follow, we reverse.

BACKGROUND

In 1995, Suburban applied to the Planning Board for approval to begin operation of an ambulatory surgical treatment center, in Mount Prospect, dedicated solely to gastroenterological procedures. Pursuant to section 8 of the Illinois Health Facilities Planning Act (Act)(20 ILCS 3960/8 (West 1996)), Suburban's application was reviewed by the Illinois Department of Public Health. As a part of that review, a public hearing was conducted on the advisability of such a treatment center. A representative of plaintiffs attended that hearing and objected to defendant's application on several grounds. Among the objections advanced was the failure of Suburban's application to adequately address certain of the "necessary criteria" used in reviewing such applications, as set forth within the Illinois Health Care Facilities Plan (Plan)(77 Ill. Admin. Code §1100.10 et seq. (1996)). Also advanced was the fact that an underutilization of current health care facilities existed within the relevant planning area. Plaintiffs' representative further argued that any additional ambulatory surgical treatment centers would have a "distinct negative impact" upon plaintiffs, as potential patients will be drawn from their facilities "which already provide the services." Specifically, plaintiffs' representative argued that "Dimensions Medical Center provides a full range of out-patient surgical procedures, including [e]ndoscopy."

Several prior Department reports, in which similar applications were deemed inadvisable due to the underutilization of existing area health care facilities, were also proffered by plaintiffs' representative during the hearing. One such report concerned an application of Access Center for Health, Ltd. and Access Health Center, Ltd. for approval to expand the surgical procedures offered in their single-specialty treatment center. An endoscopy procedure was among the surgical procedures for which approval was requested.

Dr. David Sales and Ira Rogal also testified at the public hearing; Dr. Sales, in his capacity as Suburban's medical director, and Rogal, as a consultant. Dr. Sales stated that approval for Suburban's proposed treatment center "will offer significant patient advantages," including specialization, state-of-the-art equipment, increased "opportunities for cross[-]education and specialized quality assurance" as well as substantially lower costs.

Rogal briefly described Suburban's proposed treatment center, stating that it was intended to be "a single specialty ambulatory surgical treatment center" with two procedure rooms, in which only gastroenterology procedures would be performed. Rogal further stated that Suburban's impact upon other area hospitals and ambulatory surgical treatment centers would be "minimal," while the total health care savings would be substantial.

Following that hearing, the Department issued a report to the Planning Board regarding Suburban's application. That report found Suburban's application was not in conformance with three of the "necessary criteria" outlined within the aforementioned Plan. Specifically, the Department found Suburban's application did not meet the requirements contained within sections 1110.230(e), (f) and 1110.1540(e)(77 Ill. Admin. Code §§1110.230(e), (f) and 1110.1540(e)(1996)), all of which related, in some manner, to the need for such a treatment center. Indeed, underlying each of those unsatisfactory assessments was the Department's finding that three area hospitals had "underutilized surgery suites." Also included with the Department's report were completed questionnaires used to survey 15 other area health care facilities regarding their respective charges for certain surgical procedures. Those charges were compared with those proposed by Suburban. Such a questionnaire was sent to Dimensions, who returned it with a notation simply stating that "Dimensions Medical Center proposes to provide these and other endoscopy services to the patients of Suburban Endoscopy Center below their projected charges." However, because the Department needed specific charges from each area health care facility, it consulted a prior application from Dimensions, in which the latter listed its charges for the relevant surgical procedures. Those charges were used by the Department within its report. No questionnaire was sent to Access Center for Health, Ltd. or Access Health Center, Ltd.

Suburban's application was thereafter considered by the Planning Board in February 1996. Therein, the Planning Board was presented with the Department's report. It was also advised that none of the three aforementioned area hospitals objected to Suburban's proposed treatment center, and that one was not, in fact, within the relevant planning area.

Representatives of Suburban were also given the opportunity to address the Planning Board. Billie Paige, another consultant to Suburban, explained that the Department's finding of "underutilized surgery suites" within the relevant planning area was "flawed" in that no distinction was made between endoscopy rooms and general surgery rooms. Rather, all rooms were considered together, which, according to Paige, inaccurately reflected the utilization rate of endoscopy rooms.

Dr. Sales also addressed the Planning Board, and reiterated, by way of anecdotal information, that the Department's finding of "underutilized surgery suites" was "flawed." He also listed the additional benefits Suburban's proposed treatment center would offer, as he had at the public hearing, and further pledged to keep charges constant for the next two years.

Following a series of questions from various members of the Planning Board, Suburban's application was approved.

On March 1, 1996, plaintiffs filed a complaint in administrative review, alleging, inter alia, that the Planning Board's approval was against the manifest weight of the evidence, and that Suburban's application did not satisfy certain administrative criteria. On October 10, 1996, following a determination that plaintiffs had standing to challenge the Planning Board's approval, the circuit court reversed the decision of the Planning Board. The circuit court did so on the bases that Suburban's application failed to satisfy certain of the "necessary criteria" set forth within the Plan. According to the circuit court, Suburban's application, in addition to the three unmet criteria enumerated within the Department's report, also failed to satisfy three other such criteria; ...


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