Expert Witness Testimony in Healthcare Case Allowed

A circuit court’s allowance of expert witness testimony in hospital relocation case is confirmed on appeal.

Facts: This case (Colbert County Northwest Alabama Health Care Authority d/b/a Helen Keller Hospital v. RegionalCare Hospital Partners, Inc., RCHP-Florence, LLC d/b/a North Alabama Medical Center, and the State Health Planning and Developmental Agency – Alabama Court of Civil Appeals – August 14th, 2015) involves a hospital’s application to the State Health Planning and Development Agency (SHPDA) in order to relocate to a larger facility.  A section of the opinion will be of interest to health care litigation expert witnesses.

In need of a new hospital, RegionalCare applied to SHPDA looking for a certificate of need (“CON”) to construct a 300-bed hospital in the city of Florence, as required by Alabama Law.  Subsequently, the Colbert County Northwest Health Care Authority (“Helen Keller”) filed a notice of intervention opposing the application.  An administrative law judge (ALJ) was assigned to the case and approved the application, although did not recommend the SHPDA approve a 300-bed facility as the testimony provided by Noel Falls, RegionalCare’s expert witness, was not based on reliable data or credible evidence.  The ALJ also stated that Fall’s conclusions lack scientific foundation.

Based on a “60% occupancy rule” in the Alabama Administrative Code, the ALJ concluded that the beds in the new hospital should be limited to 233 beds.  RegionalCare and Helen Keller then filed exceptions with the SHPDA regarding the ALJ’s recommendations.  The SHPDA Review Board voted to approve the recommendations, except that they issued a CON to RegionalCare for 280 beds.  Helen Keller then appealed to the Montgomery Circuit Court, who affirmed the ruling of the SHPDA CON Review Board. stating that the board had the authority to increase the number of beds for the replacement hospital.  Helen Keller then filed a notice of appeal to the present court.

Discussion: The two issues at play on appeal are: 1) The issuance of the CON to RegionalCare by the SHPDA of 280 beds) and 2) The spoliation of evidence related to Noel Falls.

Helen Keller contends that the SHPDA granted RegionalCare a 280-bed CON arbitrarily and capriciously and that they did not apply the 60% occupancy rule as they had done in similar cases.  The court looked at the statute and noted that the legislature used the word “should”  when discussing the 60% occupancy rule.  They state that the word “should” is suggestive and not mandatory.  Thus, the formula for the 60% occupancy rule does not necessarily does not have to applied strictly.

Regarding the spoliation of evidence (and of interest to readers of this blog), Helen Keller states that calculations performed by Falls were destroyed.  They state that without these calculations, they are at a disadvantage and can’t double-check that the calculations were done without error.  The court mentioned that the one factor on spoliation that they will use in this case was whether or not RegionalCare is culpable and that this test fails.

Last, Helen Keller maintains that Falls was not qualified to give testimony under Alabama Rules of Evidence 702(b).  It is important to note that the Alabama Supreme Court amended Rule 702(b), which brought it to par with the United States Supreme Court Daubert opinion, which added a section on scientific theory and methodology.  This new rule became effective on January 1st, 2012.  Helen Keller maintains that Falls’s testimony falls under the earlier version of the rule.  The court concluded that the testimony fell under the previous version of the rule.

Held: The testimony of Noel Falls was not subject to exclusion under Rule 702(b)