Although I concur in the judgment, I do so for slightly different reasons and would sustain the fourth assignment of error to a greater degree. *Page 471 Although I concur in the majority opinion concerning the first assignment of error, I find some additional reasons for the conclusions despite appellee's contentions to the contrary. The Certificate of Need Review Board ("board") implicitly determined that Ohio Adm. Code 3701-12-23(D)(3) applies to all newly constructed freestanding long-care facilities regardless of whether that facility replaces a former facility. The appellee contends that we should defer to the administrative agency's interpretation of the regulation. While this is a proper principle in the case of a regulation of doubtful meaning, it is not to be applied to vary the plain meaning of a regulation or in cases where there is no established administrative interpretation. Appellee's postulate fails on both counts.
The original application of the appellant, Christian Care Home of Cincinnati, was denied by the Director of the State Health Planning and Development Agency by a letter dated November 14, 1985. Nothing in that letter hints or suggests an interpretation of Ohio Adm. Code 3701-12-23(D)(3) precluding its application to newly constructed freestanding long-term care facilities constructed to replace an existing facility. In fact, the reason given would not even comport with such an interpretation, especially since at that time, the application was to construct a one-hundred-bed facility. No interpretation has been made by the director (now the director of the Ohio Department of Health ["ODH"]), as to the interpretation to be given to the rule. This is quite appropriate inasmuch as the adjudication hearing is conducted before the board, rather than before the director. The application was amended while pending before the board to the fifty-bed request. Thus, the interpretation issue was never before the director.
On the other hand, there was evidence of testimony from the former secretary of the public health council, the rule-making authority of the health department, and the body which passed the rule under consideration. Although he testified as to the application of some of the other paragraphs of the rule, he did not testify concerning the application of the particular provision under consideration here, the fifty-bed minimum. The hearing examiner, although making recommendation of factual findings which would ordinarily be consistent only with the granting of a request for only thirty-three beds, recommended that the application be approved for the construction of the fifty beds, replacing the thirty-three existing, with the addition of seventeen assisted-living beds (or one isolation room and sixteen assisted-living beds). Likewise, the only testimony presented by appellee was that of a medical-facilities consultant employed by the ODH. She testified unequivocally that the construction of a new facility consisting of thirty-three intermediate-care beds, one isolation room, and sixteen assisted-living beds would have been an appropriate project under the guidelines of the administrative *Page 472 code, which can be explained only if the consultant was construing Ohio Adm. Code 3701-12-23(D) to apply to all newly constructed freestanding long-care facilities. In other words, although an existing facility with less than fifty beds could continue to operate, if it be determined to construct a new facility to replace such a facility with a deficient number of beds, the new facility must conform to the requirement of a minimum of fifty beds. In short, under the plain language of the regulation, appellant would not be permitted to construct a new facility containing only thirty-three long-term care beds to replace its existing thirty-three long-term care bed facility but, instead, would, by the regulation, be required to provide for fifty beds in any newly constructed replacement facility. The regulation on June 22, 1984 apparently read as follows:
"(D) Each application for a certificate of need relating to a long term care facility shall contain the following items, as applicable:
"* * *
"(3) For applications for newly constructed freestanding long term care facilities * * * documentation that the long term care facility will have a bed capacity of at least fifty beds."
The majority opinion points out the subsequent clarification by amendment. Prior to June 22, 1984, the applicable rule was Ohio Adm. Code 3701-12-23(A) which provided that "* * * the minimum size for new or modernized long-term care facilities shall be fifty beds. * * *" Effective September 10, 1984, Ohio Adm. Code 3701-12-23(D) was amended to read substantially as it did until the amendment effective January 2, 1989 quoted in the majority opinion:
"The SHPDA [now `director'] shall not approve applications for newly constructed freestanding long-term care facilities or newly constructed long-term care facility components of continuing care retirement communities unless the long-term facility or component will have a bed capacity of at least fifty beds."
The parties have all quoted and relied upon this latter version of Ohio Adm. Code 3701-12-23(D), which was the one in effect at the time of amendment of the application to one for fifty beds.
Appellee has not explained the basis for limiting the application of the rule so as not to apply to newly constructed replacement facilities. Had the agency so intended, presumably it would have so provided in the rule itself. It would have been a simple matter to have made another provision in the rule providing that it should not apply to replacement facilities, even though newly constructed. But the rule contains no such language. It would have been so simple, had it been intended, to have added the words at the end of the rule, *Page 473 "unless such facility replaces an existing facility having less than fifty beds." Those words do not exist in the rule.
Any doubt of the meaning of the rule provision is dispelled by referring to the other portions of the rule, including the definition of "long-term care facility" set forth in Ohio Adm. Code 3701-12-23(A). Paragraph (B) of the rule sets forth the formula for determining long-term care bed need. The drafters of the rule recognize the difference between newly constructed facilities and new facilities which is clearly evinced by a comparison of paragraphs (D) and (E). Paragraph (D) provides as set forth above. Paragraph (E) states that "[t]he director shall not approve applications for new long-term care facilities ofmore than one hundred fifty beds * * *." (Emphasis added.) The appellee urges the words "newly constructed freestanding long-term care facilities" have the same meaning as "new long-term care facilities," but that is not the case. The one-hundred-fifty-bed limitation applies only to newfacilities, whereas the fifty-bed minimum applies to all newlyconstructed facilities, whether or not a new facility be involved. In short, as the majority holds, the first assignment of error is well taken.
However, this does not necessarily mean that the board erred in its determination. The board did not affirmatively deny the application but, instead, remanded the application for consideration by the ODH. Under some review procedures, this might be an appropriate means of dealing with the situation. Under the subject statutory scheme as to the relationship between the director of health and the board, however, such remand is inappropriate. First, we note that it is not the director of health who adopts rules but, instead, the public health council created by R.C. 3701.33, which is not under the direction of the director of health but, instead, consists of seven members appointed by the Governor. On the other hand, the director of health does make the initial determination whether to grant a certificate of need. The director, however, although he administers the program, reviews applications, and grants or denies certificates of need, does not conduct an adjudication hearing. Rather, the independent Certificate of Need Review Board conducts the adjudication hearing pursuant to R.C. 3702.58.
In other words, if the director denies a request for a certificate of need, the applicant may request an adjudication hearing before the board, which is the only adjudication hearing conducted, the director not being required to conduct a hearing. The determination by the board is de novo, that is, it is not just a review proceeding but, instead, the matter must be referred to a hearing examiner who must render "a written report setting forth findings of fact and conclusions of law and a recommendation of the action to be taken by the board." The board thereupon makes its decision. As noted above, there *Page 474 are no conclusions of law set forth in the hearing examiner's report or in any finding by the board limiting the application of Ohio Adm. Code 3701-12-23(D) to new facilities.
The statute, R.C. 3702.58(A), further provides that "* * * [t]he board's decision shall be based upon the record, and shall be considered as the final decision or order of the board. * * *" R.C. 3702.58(B) does provide that "[i]f, in a proceeding under division (A) of this section, the board * * * determines that a health service agency or the director of health committed procedural error, the board * * * may remand the matter to the director of health for further consideration or action." This clearly connotes that a remand to the director is appropriate only if the board finds the director "committed procedural error." Here, there is no finding of procedural error but, instead, only a finding that the modified application was improperly denied based upon the facts and the law.
I concur with the majority's finding that the decision of the common pleas court must be reversed upon this basis. The board, rather than remanding the case back to ODH, must make the determination, and should have considered all of the evidence.
I concur generally with the majority's discussion of the third assignment of error. Likewise, I concur in the majority's finding upon the second assignment of error since the director of health must be a proper party in order to ensure a proper adjudication hearing. Otherwise, in many instances, the hearing before the board would be one-sided with only appellant present and presenting evidence. The director of ODH is a necessary party to present the evidence in the public interest. On the other hand, I find some difficulty in making the ODH itself a party since it is the director, not the ODH, who makes the initial determination. In other words, the ODH is not the agency involved but, instead, it is the director of health. The rule-making party is even different as set forth above,i.e., it is the public health council. The confusion stems from an assumption that the ODH rather than the director of health issued the initial order. Admittedly, the statutes are confusing in differentiating between the different agencies and I note that even the style of this case refers to the State Certificate of Review Board as being the appellee. Accordingly, the first assignment of error is well taken, but the second is not. Likewise, the third assignment of error is not well taken since no prejudice has been demonstrated.
The fourth assignment of error is well taken. It is the duty of the common pleas court upon administrative appeal pursuant to R.C. 119.12 to engage in a limited weighing of the evidence in order to determine whether the order appealed from is supported by reliable, probative, and substantial evidence. *Page 475
Ohio Adm. Code 3701-12-23(I)(2) provides that "[i]n a county with insufficient annual bed need, as determined under paragraph (B) of this rule, a presumption is created that there is insufficient need for the project and the applicant has the burden of establishing: * * * (2) [t]hat there is sufficient need for the service in the service area." Here, the words "service area" are utilized whereas in Ohio Adm. Code3701-12-23(B) the determination of need is by county. "Service areas" may or may not be the same as the county, and may be less than or more than the county with respect to a particular facility. What the board did in this case is to find that in order for there to be "sufficient need for service in the service area," it must be determined that the need determination made pursuant to the Ohio Administrative Code is erroneous. There is no such suggestion. One provision determines "annual bed need" and the other determines "need for the project." These are not the same thing. There may be a need for a particular service in connection with a particular project in the service area even though there is sufficient annual bed need in the county.
The rule recognizes that there are varying types of service that may be performed by a long-term care facility and that there may be need for such a service even if there not be an overall need for additional long-term care beds. In fact, the regulation itself recognizes specific instances where this is true and eliminates certain types of service from application of the presumption of insufficient need for service. See Ohio Adm. Code 3701-12-23(H). The presumption of lack of need for the service may be overcome by other evidence relating to the specific facility as specific service to be provided in the service area which may be smaller or larger than the county. Only by such an interpretation does Ohio Adm. Code 3701-12-23(I)(2) have any significance or meaning.
Appellant's argument is not that the appellant has a need for more beds. Rather, what appellant contends is that there are recipients of service who are going unserved because they are applying to appellant for service which it is unable to provide. Appellant contends that these same people cannot be cared for elsewhere for whatever reason. Although appellant's evidence may not be overwhelming in this respect, it most certainly should be considered in the proper light.
Accordingly, although I concur in the judgment of reversal and remand, including the remand to the board for direct consideration and determination of the modified application, I would sustain the fourth assignment of error to the extent indicated herein. *Page 476