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In re 2006 Screening Center Designation for Warren County

May 23, 2008


On appeal from New Jersey Department of Human Services, Division of Mental Health Services.

Per curiam.


Submitted May 5, 2008

Before Judges Parrillo, S.L. Reisner and Baxter.

In these consolidated appeals, appellant Warren Hospital (Hospital) appeals from the final action of the New Jersey Department of Human Services, Division of Mental Health Services (Division), which on July 11, 2006, redesignated the Family Guidance Center of Warren County (FGC) as the screening center for emergency psychiatric services for Warren County for the July 2006 to July 2008 time period. In doing so, the Division rejected the Hospital's application and so notified the Hospital on July 19, 2006. The Hospital seeks a reversal and remand to the Division with instructions that it be designated as the screening center for Warren County.

We have been advised by the Division that on March 17, 2008, during the pendency of these appeals, it published a Notice of Request for Proposal (RFP) announcing that the agency is soliciting applications for an emergency psychiatric screening service for Warren County. See 40 N.J.R. 1710(b). Although the RFP does not specify the duration of the contract that the Division intends to award, the notice specifies that the successful applicant will be so notified no later than June 13, 2008, and the successful applicant is expected to begin providing services on July 1, 2008, with the services to be "fully operational" by September 1, 2008. Ibid. In light of the June 13, 2008 selection date, we consider the present appeals to be, for all practical purposes, moot. Nonetheless, we recognize that the issues presented on appeal are likely to recur, but tend to evade review because of the relatively short duration of the bid awards. Courts may decide cases that are technically moot when the issue is "of considerable public importance, capable of repetition, yet evading review." N.J. Div. of Youth & Family Servs. v. J.B., 120 N.J. 112, 118-19 (1990). Accordingly, in light of the important public issue involved, namely the provision of screening services for involuntary psychiatric commitment, we exercise our discretion to consider the principal issues raised by this appeal.

The FGC began operating as the screening service for Warren County in 1988. A screening service is a facility in a specified geographic area where a person believed to be in need of involuntary psychiatric commitment undergoes an assessment to determine whether he or she is a danger to self or others, thereby satisfying the statutory standard for involuntary psychiatric hospitalization. See N.J.S.A. 30:4-27.2(z); N.J.S.A. 30:4-27.5(a). Until 2001, the FGC operated out of offices in Phillipsburg. From 2001 through 2004, the FGC was physically located in Warren Hospital's emergency room, pursuant to an affiliation agreement. On June 1, 2004, the FGC was redesignated as the screening center for Warren County for a two-year period, which included a one-year waiver from the regulatory requirement, N.J.A.C. 10:31-2.1(a)(6), that a screening center have holding beds with twenty-four hour capability.

In 2004, the relationship between the hospital and the FGC deteriorated to the point that the two were unable to negotiate a continuation of the affiliation agreement. A principal point of contention was the Hospital's belief that the FGC was not performing its screening center functions properly. The FGC in turn claimed the dispute was due to "significant differences in the . . . interpretation of the New Jersey Rules and Regulations." The FGC vacated the hospital in 2005, moving its operations back to the office building, which was located a few blocks from the hospital.

On June 2, 2005, the Warren County Mental Health Board (County Board) approved two waivers sought by the FGC: the requirement of an extended crisis evaluation bed and the requirement that the center be physically located in a hospital. On August 3, 2005, the Division approved the County Board's waivers, effective until June 30, 2006. The Hospital appealed the grant of the location waiver. We reversed the grant of that waiver and remanded for reconsideration. Warren Hosp. v. N.J. Dep't of Human Servs., No. A-209-05 (App. Div. March 6, 2007). On remand, the agency issued a detailed, twelve-page decision explaining its reasons for granting the location waiver.

Because of shortages of medical personnel, the FGC requested on September 12, 2005, that the Division grant a third waiver, this time from the face-to-face assessment requirement in order to permit "telepsychiatry" to be conducted by a health company located in Marlton using a remote video hook-up. On November 16, 2005, the Division approved the waiver, effective until June 30, 2006. On appeal, the Hospital succeeded in its challenge of that waiver.*fn1

On November 29, 2005, the Hospital by letter notified the County Board that it intended to seek designation as the screening center for Warren County beginning in July 2006. In its letter, the Hospital requested the County Board's "guidance on the procedure that Warren should follow when submitting this proposal to the Board." On January 4, 2006, the County Board responded, in part:

The county Mental Health Board is asked by DMHS to comment on the Family Guidance Center's screening program every two years, as DMHS is considering redesignation . . . . The Mental Health Board welcomes participation from local providers and consumers. Warren Hospital is welcome to provide information to the Mental Health Board and participate in meetings regarding the provision of services and program development throughout the year.

The Hospital responded on February 10, 2006, informing the County Board that: your correspondence did not provide any information on the procedure that Warren should follow when submitting its proposal to the Board. Nor is the procedure available through other means. Among other things, we are seeking specific details on applicable deadlines for the submission of the proposal, the format for the proposal, and information that must be included in the proposal.

The County Board responded on February 16, 2006, by advising the Hospital to contact the Division for answers to these questions.

On April 4, 2006, the FGC requested redesignation as the designated screening center for Warren County for the 2006-2008 time period. As part of that request, the FGC requested waivers from the following requirements: twenty-four hour crisis evaluation, location of the screening center in a hospital setting, and face-to-face psychiatric evaluation.

On April 26, 2006, the Hospital formally submitted its proposal to the Division for designation as the screening center for Warren County, effective July 1, 2006. The Hospital pointed out that its application fully complied with all regulatory requirements and no waivers were required. On April 28, 2006, the County Board requested assistance from the Division on how to proceed in the face of the two applications. Specifically, the Board sought answers to the following questions:

While the MHB stands ready to work with DMHS to determine the best possible screening service for Warren County, the process for reviewing an unsolicited proposal is unclear. Is it permissible to give consideration to the Warren Hospital proposal without a competitive process which invites all potential providers to apply? . . . . Can DMHS potentially move funding from one provider to another without a competitive process? The MHB is ...

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