For the second time this year, Florida has denied certificate-of-need approval to Walt Disney Co. to build a 60-bed hospital on the grounds of its Celebration Health development project.
A Disney official isn't sure whether the company will go for a third round.
"We have maintained a window of time to make all decisions, and we are evaluating our options," said Des Cummings Jr., Celebration's president and chief executive officer.
The Florida Agency for Health Care Administration said declining occupancy numbers in the area was the major reason for the denial. It said the hospital occupancy rate in Osceola County, Fla., which includes Orlando, was less than 44% in 1996.
The agency's decision is preliminary, however, because state officials said they want to work with Celebration executives to see if a compromise can be reached.
"While the proposal is creative and has the support of the community, there is no way for the agency to justify the need within the state's current regulatory framework," said Colleen David, an agency spokeswoman.
The hospital actually would be owned by Adventist Health System-Sunbelt, which would transfer beds to the new facility from the licensed bed count of its flagship hospital, nearby Florida Hospital Medical Center in Orlando.
Florida Hospital is licensed for 1,452 beds but staffs 1,387.
Two competing hospital systems-Orlando Regional Healthcare System and Columbia/HCA Healthcare Corp.
-opposed Disney's CON application.
Celebration's first priority is to find out from state regulators what they see as a possible compromise, Cummings said.
Celebration, a 60-acre health complex that's expected to open in November, is being developed in two stages.
The first stage, which includes an outpatient facility, diagnostic services, fitness and rehabilitation centers, a pharmacy and physician offices, will be unaffected by the state's decision and will open as scheduled, Cummings said.
Construction on the second phase, which includes the hospital, will continue, a Florida Hospital spokeswoman said. The facility is being built so that it has the flexibility to be used for nonhealthcare purposes or other creative outpatient services.
The state denied Celebration's first CON application to build the hospital because of the cost. The tab for the total facility is expected to be $111 million, which includes $48.5 million for an inpatient tower and emergency room. The spokeswoman said the cost wasn't criticized in the second application because Celebration did a better job at explaining that the hospital would be used by the Florida community, not just Central Florida residents.