{ "id": 4131428, "name": "WAKEMED, Petitioner v. NORTH CAROLINA DEPARTMENT OF HEALTH AND HUMAN SERVICES, DIVISION OF HEALTH SERVICE REGULATION, CERTIFICATE OF NEED SECTION, Respondent and REX HOSPITAL, INC. d/b/a REX HEALTHCARE, Respondent-Intervenor", "name_abbreviation": "Wakemed v. North Carolina Department of Health & Human Services", "decision_date": "2013-01-15", "docket_number": "No. COA12-364", "first_page": "253", "last_page": "263", "citations": [ { "type": "official", "cite": "225 N.C. App. 253" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "625 S.E.2d 837", "category": "reporters:state_regional", "reporter": "S.E.2d", "case_ids": [ 12635086 ], "year": 2006, "pin_cites": [ { "page": "840", "parenthetical": "internal quotations and citation omitted" } ], "opinion_index": 0, "case_paths": [ "/se2d/625/0837-01" ] }, { "cite": "615 S.E.2d 81", "category": "reporters:state_regional", "reporter": "S.E.2d", "case_ids": [ 12633410 ], "year": 2005, "pin_cites": [ { "page": "84", "parenthetical": "quoting N.C. Gen. Stat. \u00a7 150B-51(b) (1999)" } ], "opinion_index": 0, "case_paths": [ "/se2d/615/0081-01" ] }, { "cite": "510 S.E.2d 159", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 3, "year": 1999, "pin_cites": [ { "page": "163", "parenthetical": "intemal quotations and citation omitted" }, { "parenthetical": "emphasis added" }, { "page": "163" } ], "opinion_index": 0 }, { "cite": "350 N.C. 39", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 132016 ], "weight": 2, "year": 1999, "pin_cites": [ { "page": "45", "parenthetical": "intemal quotations and citation omitted" }, { "page": "45" } ], "opinion_index": 0, "case_paths": [ "/nc/350/0039-01" ] }, { "cite": "276 S.E.2d 422", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1981, "pin_cites": [ { "page": "435", "parenthetical": "intemal quotations and citation omitted" } ], "opinion_index": 0 }, { "cite": "302 N.C. 403", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8567220 ], "year": 1981, "pin_cites": [ { "page": "423", "parenthetical": "intemal quotations and citation omitted" } ], "opinion_index": 0, "case_paths": [ "/nc/302/0403-01" ] }, { "cite": "455 S.E.2d 455", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1995, "pin_cites": [ { "page": "460", "parenthetical": "internal quotations and citation omitted" } ], "opinion_index": 0 }, { "cite": "118 N.C. App. 379", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11918457 ], "year": 1995, "pin_cites": [ { "page": "384", "parenthetical": "internal quotations and citation omitted" } ], "opinion_index": 0, "case_paths": [ "/nc-app/118/0379-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 131-183", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 2, "pin_cites": [ { "parenthetical": "a" }, { "page": "(a)(13)", "parenthetical": "emphasis added" } ], "opinion_index": 0 }, { "cite": "176 N.C. App. 46", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8300808 ], "year": 2006, "pin_cites": [ { "page": "51", "parenthetical": "internal quotations and citation omitted" } ], "opinion_index": 0, "case_paths": [ "/nc-app/176/0046-01" ] }, { "cite": "705 S.E.2d 753", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2011, "opinion_index": 0 }, { "cite": "365 N.C. 78", "category": "reporters:state", "reporter": "N.C.", "year": 2011, "opinion_index": 0 }, { "cite": "171 N.C. App. 734", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8439431 ], "year": 2005, "pin_cites": [ { "page": "739", "parenthetical": "quoting N.C. Gen. Stat. \u00a7 150B-51(b) (1999)" } ], "opinion_index": 0, "case_paths": [ "/nc-app/171/0734-01" ] }, { "cite": "696 S.E.2d 187", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 3, "year": 2010, "pin_cites": [ { "page": "192", "parenthetical": "quoting Total Renal Care of N.C., LLC v. N.C. Dep't of Health & Human Servs., 171 N.C. App. 734, 739, 615 S.E.2d 81, 84 (2005) (quoting N.C. Gen. Stat. \u00a7 150B-51(b) (1999))" }, { "page": "191-92" } ], "opinion_index": 0 }, { "cite": "205 N.C. App. 529", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 3733913 ], "weight": 2, "year": 2010, "pin_cites": [ { "page": "534", "parenthetical": "quoting Total Renal Care of N.C., LLC v. N.C. Dep't of Health & Human Servs., 171 N.C. App. 734, 739, 615 S.E.2d 81, 84 (2005) (quoting N.C. Gen. Stat. \u00a7 150B-51(b) (1999))" }, { "page": "534" } ], "opinion_index": 0, "case_paths": [ "/nc-app/205/0529-01" ] } ], "analysis": { "cardinality": 814, "char_count": 23383, "ocr_confidence": 0.74, "pagerank": { "raw": 4.03580807328026e-08, "percentile": 0.13332727120384238 }, "sha256": "65cc3e3750c2e05f0db3a5829b1c11139ce56ca15cefbbb635c3bb37082e6ab1", "simhash": "1:c538c4cf559f6854", "word_count": 3576 }, "last_updated": "2023-07-14T19:12:03.865649+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges HUNTER, Robert C. and HUNTER, JR., Robert N. concur." ], "parties": [ "WAKEMED, Petitioner v. NORTH CAROLINA DEPARTMENT OF HEALTH AND HUMAN SERVICES, DIVISION OF HEALTH SERVICE REGULATION, CERTIFICATE OF NEED SECTION, Respondent and REX HOSPITAL, INC. d/b/a REX HEALTHCARE, Respondent-Intervenor" ], "opinions": [ { "text": "CALABRIA, Judge.\nWakeMed appeals the Final Agency Decision (\u201cFAD\u201d) of the North Carolina Department of Health and Human Services, Division of Health Service Regulation (\u201cthe Department\u201d), awarding a certificate of need (\u201cCON\u201d) to Rex Hospital, Inc. d/b/a Rex Healthcare (\u201cRex\u201d). We affirm.\nI. Background\nOn 15 June 2010, Rex submitted a CON application (\u201cthe application\u201d) to the Department, proposing to construct an addition to Rex Hospital in Raleigh, North Carolina. Specifically, the addition would expand and consolidate Rex\u2019s surgical and cardiovascular services, as well as create a new main entrance and public concourse in the hospital. The application was not part of a competitive review, but rather a stand-alone application.\nThe Department\u2019s CON section began its review of the application on 1 July 2010. A public hearing on the application was held on 18 August 2010. WakeMed did not have a representative at the public hearing and did not otherwise submit any comments on the application. On 29 October 2010, the CON section conditionally approved Rex\u2019s application.\nOn 24 November 2010, WakeMed filed a petition for contested case hearing in the Office of Administrative Hearings challenging the CON section\u2019s approval of the application. Rex was permitted to intervene in the case. Beginning 27 June 2011, a contested case hearing was conducted by Administrative Law Judge Beecher R. Gray (\u201cJudge Gray\u201d). After WakeMed presented its evidence, Rex and the Department made a joint motion to dismiss based upon WakeMed\u2019s failure to show either substantial prejudice or agency error. Judge Gray granted the motion on both grounds and issued a Recommended Decision dismissing the case on 19 August 2011.\nWakeMed appealed Judge Gray\u2019s decision to the Department. On 24 October 2011, the Department issued a FAD which accepted Judge Gray\u2019s Recommended Decision. The FAD dismissed WakeMed\u2019s case and awarded the CON to Rex. WakeMed appeals.\nII. Standard of Review\nA CON determination will only be reversed if the appellant demonstrates that its substantial rights have been prejudiced because the decision, findings, or conclusions of the Department are:\n(1) In violation of constitutional provisions;\n(2) In excess of the statutory authority or jurisdiction of the agency;\n(3) Made upon unlawful procedure;\n(4) Affected by other error of law;\n(5) Unsupported by substantial evidence admissible under G.S. 150B-29(a), 150B-30, or 150B-31 in view of the entire record as submitted; or\n(6) Arbitrary or capricious.\nParkway Urology, P.A. v. N.C. Dep\u2019t of Health & Human Servs., 205 N.C. App. 529, 534, 696 S.E.2d 187, 192 (2010) (quoting Total Renal Care of N.C., LLC v. N.C. Dep\u2019t of Health & Human Servs., 171 N.C. App. 734, 739, 615 S.E.2d 81, 84 (2005) (quoting N.C. Gen. Stat. \u00a7 150B-51(b) (1999))), disc. rev. denied, 365 N.C. 78, 705 S.E.2d 753 (2011).\nThe substantive nature of each assignment of error controls our review of an appeal from an administrative agency\u2019s final decision. Where a party asserts an error of law occurred, we apply a de novo standard of review. If the issue on appeal concerns an allegation that the agency\u2019s decision is arbitrary or [capricious] or fact-intensive issues such as sufficiency of the evidence to support [an agency\u2019s] decision we apply the whole-record test.\nCraven Reg\u2019l Med. Auth. v. N.C. Dep\u2019t. of Health & Human Servs., 176 N.C. App. 46, 51, 625 S.E.2d 837, 840 (2006)(internal quotations and citation omitted).\nIII. Criterion 13(a)\nWakeMed argues that the Department erred in issuing a CON to Rex. Specifically, WakeMed contends that the Department failed to apply the express language of N.C. Gen. Stat. \u00a7 131-183 (a)(13)(a) (\u201cCriterion 13(a)\u201d) to the application. We disagree.\n\u201cN.C. Gen. Stat. \u00a7 131E-183(a) charges the Agency with reviewing all CON applications utilizing a series of criteria set forth in the statute. The application must either be consistent with or not in conflict with these criteria before a certificate of need for the proposed project shall be issued.\u201d Parkway Urology, 205 N.C. App. at 534, 696 S.E.2d at 191-92. In the instant case, WakeMed specifically challenges the Department\u2019s conclusion that Rex\u2019s application complied with Criterion 13(a). This criterion states:\nThe applicant shall demonstrate the contribution of the proposed service in meeting the health-related needs of the elderly and of members of medically underserved groups, such as medically indigent or low income persons, Medicaid and Medicare recipients, racial and ethnic minorities, women, and handicapped persons, which have traditionally experienced difficulties in obtaining equal access to the proposed services, particularly those needs identified in the State Health Plan as deserving of priority. For the purpose of determining the extent to which the proposed service will be accessible, the applicant shall show:\na. The extent to which medically underserved populations currently use the applicant\u2019s existing services in comparison to the percentage of the population in the applicant\u2019s service area which is medically underserved;\nN.C. Gen. Stat. \u00a7 131E-183 (a)(13)(a) (2011). WakeMed argues that, in order to satisfy this criterion, Rex was required to submit an explicit comparison of \u201cthe extent to which medically underserved populations currently use the applicant\u2019s existing services\u201d and \u201cthe percentage of the population in the applicant\u2019s service area which is medically underserved.\u201d Id. The Department concedes that the comparison sought by WakeMed was not included in Rex\u2019s application.\nHowever, in the FAD, the Department declined to adopt WakeMed\u2019s statutory interpretation of Criterion 13(a) because it concluded that the comparison sought by WakeMed was impossible to apply to Rex\u2019s application. WakeMed contends that the Department\u2019s interpretation of Criterion 13(a) is erroneous because it directly conflicts with the plain language of the statute by failing to require a comparison.\nAlthough the interpretation of a statute by an agency created to administer that statute is traditionally accorded some deference by appellate courts, those interpretations are not binding. The weight of such [an interpretation] in a particular case will depend upon the thoroughness evident in its consideration, the validity of its reasoning, its consistency with earlier and later pronouncements, and all those factors which give it power to persuade, if lacking power to control.\nBritthaven, Inc. v. N.C. Dept. of Human Resources, 118 N.C. App. 379, 384, 455 S.E.2d 455, 460 (1995) (internal quotations and citation omitted).\nThe Department based its interpretation of Criterion 13(a) on, inter alia, the following findings of fact:\n421. N.C. Gen. Stat. \u00a7 131E-183(a)(13)(a) (\u201cCriterion 13(a)\u201d) requires an applicant to show the extent to which the medically underserved populations currently utilize applicant\u2019s existing services. According to [CON Section Assistant Chief Martha] Frisone, the Agency has typically reviewed this criterion by reviewing the percentage of the facility\u2019s total patients that fit into the various categories of \u201cmedically underserved,\u201d such as Medicare, Medicaid, handicapped, racial and ethnic minorities and women.\n422. Applicants provide their historical payor mix to demonstrate conformity to Criterion 13.\n441. Criterion 13(a) does not have a litmus test or a specific number, either percentage or monetary amount, that must be satisfied for conformity.\n444. All of the payor mix information presented by WakeMed at the contested case hearing was on an aggregate basis based on the particular facility as a whole and WakeMed witnesses were unable to provide any service-line specific information. This facility-wide data appears unreliable for use in any comparison under Criterion 13(a) for a number of reasons.\n451. A meaningful comparison of the payor mix for the specific service lines proposed in Rex\u2019s Application cannot be made because the information is not publically available.\n453. Under Criterion 13(a), the Agency did not err in failing to make the type of payor mix percentage comparisons that WakeMed proposes should have been made.\n454. Rex\u2019s Application adequately explained and documented that it does not discriminate on the basis of income, race, ethnicity, sex, handicap, age or any other factor which might restrict access to services. Rex\u2019s Application also adequately provided its historical payor mix during FY2009 for all services at Rex as well as for each service component of the proposed project.\nThus, the Department found that the evidence presented at the CON hearing demonstrated that it could not conduct a meaningful comparison of the services proposed in Rex\u2019s application under Criterion 13(a) as proposed by WakeMed.\nOur Supreme Court has explained that \u201c[t]he language of a statute should always be interpreted in a way which avoids an absurd consequence: A statute is never to be construed so as to require an impossibility if that result can be avoided by another fair and reasonable construction of its terms.\u201d Sheffield v. Consolidated Foods Corp., 302 N.C. 403, 423, 276 S.E.2d 422, 435 (1981)(intemal quotations and citation omitted). Moreover, \u201cwhere a literal interpretation of the language of a statute will lead to absurd results, or contravene the manifest purpose of the Legislature, as otherwise expressed, the reason and purpose of the law shall control and the strict letter thereof shall be disregarded.\u201d Frye Reg\u2019l Med. Ctr. v. Hunt, 350 N.C. 39, 45, 510 S.E.2d 159, 163 (1999)(intemal quotations and citation omitted). Thus, we must determine (1) whether the Department was correct that it could not apply a Criterion 13(a) comparison to Rex\u2019s application; and (2) if so, whether the Department correctly assessed Rex\u2019s application taking into account the reason and purpose of the law.\nA. Facilitv-wide Data\nWakeMed contends that the Department incorrectly determined that a comparison was not possible under Criterion 13(a) for Rex\u2019s application. WakeMed argues that the Department erred by focusing on the specific payor lines included in Rex\u2019s application because Criterion 13(a) instead \u201crequires evaluation of the extent to which medically underserved populations currently use all of the applicant\u2019s existing services in comparison to the percentage of the population in the applicant\u2019s service area which is medically underserved,\u201d and the Department could have performed such a comparison.\nTo support its argument that Criterion 13(a) requires the Department to examine all of an applicant\u2019s existing services, WakeMed notes that subsection (a) of Criterion 13 specifically requires the CON applicant to demonstrate \u201c[t]he extent to which medically underserved populations currently use the applicant\u2019s existing services.\u201d WakeMed then notes that, in contrast, subsection (c) of Criterion 13 requires the CON applicant to demonstrate \u201c[t]hat the elderly and the medically underserved groups identified in this subdivision will be served by the applicant\u2019s proposed services.\u201d N.C. Gen. Stat. \u00a7 131E-183(a)(13)(a), (c). WakeMed contends that the use of the term \u201cproposed services\u201d in Criterion 13(c) shows that the term \u201cexisting services\u201d in Criterion 13(a) does not refer to just the applicant\u2019s existing proposed services, but instead refers to all of the applicant\u2019s existing services.\nHowever, as noted by the Department, WakeMed\u2019s interpretation ignores the prefatory language of Criterion 13, which applies to and provides context for all of the subsequent subparts of the criterion. This language specifically states that the purpose of Criterion 13 is for \u201c[t]he applicant [to] demonstrate the contribution of the proposed service in meeting the health-related needs of the elderly and of members of medically underserved groups[.]\u201d N.C. Gen. Stat. \u00a7 131E-183(13) (2011)(emphasis added). The statute specifically directs the Department to use the information required by Criterion 13(a)-(d) \u201c[f]or the purpose of determining the extent to which the proposed service will be accessible[.]\u201d Id. (emphasis added). It is clear from this prefatory language that, as the Department determined in the FAD, the General Assembly intended the focus of the comparison in Criterion 13 to be in the context of the specific services being proposed in the CON application. Therefore, the Department properly concluded that \u201cthe General Assembly\u2019s focus in Criterion 13 is upon the services being proposed in the CON application at issue, and not upon the aggregate facility-wide services that are not part of the project proposed in the CON application being reviewed.\u201d\nMoreover, the FAD contains numerous findings which demonstrate that WakeMed\u2019s proposed comparison of facility-wide data under Criterion 13(a) would fail to provide the Department with reliable information. These findings include:\n446. The aggregate facility-wide data used by WakeMed also does not take into account the different service lines at different hospitals. WakeMed witnesses, including [] Gambill and [William Stanley] Taylor, agreed that payor mixes are variable by hospital service line. Mr. Gambill testified that he had been able to isolate baby deliveries as being a particular service line that tended to have a higher Medicaid percentage than other service lines.\n449. The aggregate facility-wide data used by WakeMed also does not take into account the different locations and service lines of different hospitals.\nThe Department\u2019s findings establish that the facility-wide data which WakeMed contends should be the basis of the comparison in Criterion 13(a) would provide no information regarding \u201cthe extent to which the proposed service will be accessible[.]\u201d N.C. Gen. Stat. \u00a7 131E-183(13). Thus, these findings provide further support for the Department\u2019s decision to reject WakeMed\u2019s proposed interpretation of Criterion 13(a).\nFinally, the FAD includes multiple findings which discuss the impact of using the comparison test proposed by WakeMed. Specifically, the Department found, based on the testimony provided by WakeMed\u2019s expert, William Stanley Taylor (\u201cTaylor\u201d), that \u201chalf of the hospitals in North Carolina (50%) would fail the Criterion 13(a) test that [Taylor] is requesting the Agency to apply to Rex\u2019s Application.\u201d This finding further demonstrates that the Department properly rejected WakeMed\u2019s proposed interpretation of Criterion 13(a), because WakeMed\u2019s interpretation, which would lead to half of North Carolina\u2019s hospitals being unable to qualify for a CON, clearly produces absurd results which would contravene the General Assembly\u2019s manifest purpose in enacting the CON law. Thus, WakeMed\u2019s proposed interpretation of Criterion 13(a), which would have required a comparison of an applicant\u2019s facility-wide data, violated several principles of statutory construction and the Department correctly rejected it.\nB. Service-line Specific Data\nIn the FAD, the Department additionally concluded that it could not conduct a comparison of the specific service lines included in Rex\u2019s application. This conclusion was based upon its finding that there was no publically-available data which could form the basis of any such comparison. WakeMed does not challenge the Department\u2019s finding and there was no evidence presented at the CON hearing which conflicts with the Department\u2019s finding. Since there was no publically-available information available to the Department regarding the service lines included in Rex\u2019s application, there was no data for the Department to compare. Thus, the Department properly concluded that, under the circumstances of this case, no service-line specific comparison could be conducted under Criterion 13(a) due to this lack of data.\nC. Prior CON Applications\nWakeMed additionally argues that the Department\u2019s interpretation of Criterion 13(a) with regard to Rex\u2019s application is inconsistent with the Department\u2019s treatment of prior CON applications. Specifically, WakeMed contends that the Department previously performed a Criterion 13(a) comparison on Hillcrest Convalescent Center (\u201cHillcrest\u201d) and ultimately denied Hillcrest a CON based upon its failure to satisfy that criterion. However, the FAD'includes multiple findings which distinguish the Hillcrest application from the Rex application:\na. The Hillcrest review involved a nursing home facility and the predominant payor for nursing homes is Medicaid, which differs from hospitals as a whole as well as the services in Rex\u2019s application;\nb. Individual nursing homes do not differ in service lines offered as compared to hospitals that can differ dramatically in service lines which in turn causes different payor mixes among hospitals;\nc. The data to perform the comparison analysis in the Hillcrest review was publically-available, as compared to the non-public service-line data of hospitals;\nd. The data to perform the comparison analysis in the Hillcrest review related to the services at issue in that review, which differs from WakeMed\u2019s assertion that aggregate facility-wide data should be used in the review of Rex\u2019s application; and\ne. The Hillcrest facility was an aberration, having a 3% Medicaid payor mix as compared to the State average of over 60%.\nThese findings, which are not challenged by WakeMed, establish that there was sufficient, publically-available data for the Department to conduct a Criterion 13(a) comparison on Hillcrest\u2019s application. In contrast, according to the uncontroverted evidence, noted above, no such publically-available data on the service lines was included in Rex\u2019s application. This lack of information formed the basis of the Department\u2019s conclusion that it could not perform a Criterion 13(a) comparison on Rex\u2019s application. Since this was a substantial difference between Hillcrest\u2019s application and Rex\u2019s application, WakeMed has failed to demonstrate that the Department has inconsistently applied Criterion 13(a). The interpretation of Criterion 13(a) that the Department applied to Rex\u2019s application could only be applicable in a situation, such as the instant case, where a service-line comparison is not possible.\nD. Purpose of the Statute\nThe prefatory language of Criterion 13 makes clear that the Department must focus on \u201cthe extent to which the proposed service will be accessible,\u201d N.C. Gen. Stat. \u00a7 131-183(a)(13) (emphasis added), rather than the applicant\u2019s services as a whole. Moreover, as demonstrated by the Department\u2019s findings, the implementation of a facility-wide comparison under Criterion 13(a) would lead to absurd consequences. Therefore, a proper comparison under Criterion 13(a) must focus on the services proposed in the CON application.\nIn the instant case, the Department\u2019s findings and conclusions, supported by the evidence at the CON hearing, establish that it was impossible to compare Rex\u2019s service-line specific data to medically underserved populations in Rex\u2019s service area due to a lack of available data. Since the FAD definitively established that it was impossible for the Department to conduct the comparison in Criterion 13(a), the Department was required by principles of statutory construction to disregard the literal language of Criterion 13(a) in evaluating Rex\u2019s application and instead determine whether \u201cthe reason and purpose of the law\u201d were satisfied. Frye Reg\u2019l Med. Ctr., 350 N.C. at 45, 510 S.E.2d at 163.\nIn the FAD, the Department concluded that Criterion 13 \u201caddresses the degree to which the elderly and members of medically underserved groups have and will have access to the services proposed in the CON application at issue.\u201d The Department\u2019s conclusion is consistent with the plain language of Criterion 13. In order to determine if Rex complied with this criterion, the Department examined Rex\u2019s \u201chistorical payor mix during FY2009 for . . . each component of the proposed project.\u201d The Department found that Rex did not \u201cdiscriminate on the basis of income, race, ethnicity, sex, handicap, age, or any other factor which might restrict access to services.\u201d Consequently, the Department concluded that \u201cRex\u2019s Application adequately demonstrated that Rex provides adequate access to medically underserved populations.\u201d\nBased upon the evidence presented and the Department\u2019s unchallenged findings, we hold that the Department properly concluded that Rex\u2019s application complied with Criterion 13(a). Although it could not perform an explicit comparison, the Department specifically analyzed Rex\u2019s data regarding its prior service to medically underserved individuals. The Department\u2019s analysis adequately demonstrates that it was guided by the reason and purpose of Criterion 13 when it found Rex\u2019s application in compliance with that criterion. WakeMed\u2019s argument is overruled.\nWakeMed does not challenge any other portion of the FAD. Since we have concluded that the Department properly concluded that Rex\u2019s application complied with Criterion 13(a), it is unnecessary to address WakeMed\u2019s argument that it was substantially prejudiced by an error in the Department\u2019s approval of Rex\u2019s CON application.\nIV. Conclusion\nThe Department did not err in its interpretation of Criterion 13(a). The prefatory language of Criterion 13 makes clear that the Department must analyze that criterion in the context of the services being proposed in the CON application. Since, in the instant case, it was impossible to conduct a comparison of the specific services proposed in Rex\u2019s application, the Department was instead required to apply the reason and purpose of Criterion 13(a) to Rex\u2019s application. In this context, the Department properly analyzed Rex\u2019s application to determine whether Rex provided adequate access to medically underserved populations. Based upon the findings in the FAD, the Department did not err in its conclusion that Rex\u2019s application complied with Criterion 13(a). The FAD is affirmed.\nAffirmed.\nJudges HUNTER, Robert C. and HUNTER, JR., Robert N. concur.", "type": "majority", "author": "CALABRIA, Judge." } ], "attorneys": [ "Smith Moore Leatherwood LLP, by Maureen Demarest Murray and Susan McNear Fradenburg, for petitioner-appellant.", "Attorney General Roy Cooper, by Special Deputy Attorney General June S. Ferrell, for respondent-appellee.", "K&L Gates LLP, by Gary S. Qualls and William W. Stewart, Jr., for respondent-intervenor-appellee." ], "corrections": "", "head_matter": "WAKEMED, Petitioner v. NORTH CAROLINA DEPARTMENT OF HEALTH AND HUMAN SERVICES, DIVISION OF HEALTH SERVICE REGULATION, CERTIFICATE OF NEED SECTION, Respondent and REX HOSPITAL, INC. d/b/a REX HEALTHCARE, Respondent-Intervenor\nNo. COA12-364\nFiled 15 January 2013\nAdministrative Law \u2014 certificate of need \u2014 statutory compliance\nThe North Carolina Department of Health and Human Services, Division of Health Service Regulation (DHHS) did not err by issuing a final agency decision accepting an administrative law judge\u2019s recommended decision dismissing plaintiff WakeMed\u2019s challenge to the issuance of a certificate of need (\u201cCON\u201d) to Rex Healthcare (Rex) and awarding a CON to Rex. DHHS correctly determined that it could not apply an N.C.G.S. \u00a7 131-183 (a)(13)(a) (\u201cCriterion 13(a)\u201d) comparison to Rex\u2019s application and correctly assessed Rex\u2019s application taking into account the reason and purpose of the law.\nAppeal by petitioner from Final Agency Decision entered 24 October 2011 by the North Carolina Department of Health and Human Services. Heard in the Court of Appeals 10 October 2012.\nSmith Moore Leatherwood LLP, by Maureen Demarest Murray and Susan McNear Fradenburg, for petitioner-appellant.\nAttorney General Roy Cooper, by Special Deputy Attorney General June S. Ferrell, for respondent-appellee.\nK&L Gates LLP, by Gary S. Qualls and William W. Stewart, Jr., for respondent-intervenor-appellee." }, "file_name": "0253-01", "first_page_order": 263, "last_page_order": 273 }