Jan. 25 (Bloomberg) -- A Florida judge ruled in favor of a troubled brain-injury center fighting a state order to transfer 50 of its patients, saying the regulation under which the edict was issued was invalid.
The decision represented a measure of relief for the Florida Institute for Neurologic Rehabilitation Inc., which is struggling to retain and recruit patients following Bloomberg News stories detailing the deaths of five patients since 1998 and complaints that scores of others were mistreated.
The Florida Agency for Health Care Administration said in August that the center was violating its license by treating 50 patients who didn’t have traumatic brain injuries.
The agency ordered FINR to begin crafting plans to send those patients to facilities with appropriate licenses. FINR never moved them because of the order, although some of the 50 left in the regular course of the treatment process, said Lyndsey Cruley, a FINR spokeswoman.
The 50 patients represent about a quarter of the total capacity the Wauchula, Florida-based center, which treats people from across the country.
In today’s ruling, state Administrative Law Judge Suzanne Van Wyk said in a 43-page decision that the regulation relied upon by the Florida agency is “arbitrary and capricious” and an “invalid exercise of delegated legislative authority” because it “enlarges and contravenes the law implemented.”
FINR owner Joseph Brennick said in a statement that he was “relieved that Judge Van Wyk has ruled in our favor today, as we truly believe that we are the very best and often the only option for these patients who have suffered a head injury.”
Shelisha Coleman, a spokeswoman for state health care agency, said officials were reviewing the ruling.
Some families and out-of-state human service agencies have been pulling patients out of the facility. Earlier this month, FINR filed for Chapter 11 bankruptcy protection, shortly after Regions Bank, a Birmingham, Alabama-based unit of Regions Financial Corp., sued the institute for allegedly defaulting on $31 million in real estate loans.
In a filing in that case, FINR said it began to experience a decline in revenue as patients left following the Bloomberg articles and subsequent reports from other media.
As of Dec. 12, FINR reported 77 of the 143 beds at its main facility and two group homes nearby were occupied, according to state regulators. Numbers weren’t available for the center’s remaining beds. The Regions Bank complaint alleges the center is in violation of a loan provision that requires it to maintain a minimum daily occupancy of 75 percent of capacity.
Connecticut officials last year said they would no longer place residents from that state at FINR and was in the process of removing some of the 10 patients from that state being treated at the facility.
California disability agencies have brought eight patients from FINR back to the state since last year and plans are underway to do the same with the remaining seven patients at the facility, according to Nancy Lungren, a spokeswoman for the Department of Developmental Services.
In its bankruptcy filing, FINR indicated it had a plan should the judge rule against it in the challenge of the order to move the 50 patients. FINR said it would “legally de-license a certain number of beds (on the order of 50) and continue to treat the non-traumatic patients in unlicensed beds, fully within the confines of the law.”
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