STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
AGENCY FOR HEALTH CARE ADMINISTRATION,
Petitioner,
vs.
HAL M. TOBIAS,
Respondent.
/
Case No. 13-3818MPI
RECOMMENDED ORDER
On January 22, 2014, Robert E. Meale, Administrative Law Judge of the Division of Administrative Hearings, conducted the final hearing in Tallahassee, Florida.
APPEARANCES
For Petitioner: David W. Nam, Esquire
Agency for Health Care Administration Fort Knox Building 3, Mail Stop 3 2727 Mahan Drive, Suite 3431
Tallahassee, Florida 32308
For Respondent: Ronald F. Davis
Qualified Representative
2227 West Main Street, Suite 3
Jacksonville, Arkansas 72076 STATEMENT OF THE ISSUE
The issue is the determination of the amount of investigative, legal, and expert witness costs that, pursuant to section 409.913(23)(a), Florida Statutes, Petitioner is entitled
to recover from Respondent for ultimately prevailing in DOAH Case
No. 10-9318MPI.
PRELIMINARY STATEMENT
By Motion for Remand to the Division of Administrative Hearings and for an Evidentiary Hearing on Recovery of Costs served September 19, 2013 (Motion for Remand), the Agency for Health Care Administration (AHCA) remanded DOAH Case 10-9318MPI to the Division of Administrative Hearings (DOAH) for an evidentiary hearing on costs. The motion states that, on August 8, 2011, AHCA entered a final order that, among other things, assessed actual investigative, legal, and expert witness costs against Respondent (Final Order). The Final Order directs the parties to try to stipulate to these costs and, if they were unable to do so, advises them that AHCA will remand the case to DOAH for an evidentiary hearing on costs.
The Motion for Remand states that Petitioner seeks
$33,394.98 in costs: $154 for Gregory Riley, R.N., a registered nurse consultant; $487.33 for Jennifer Ellingsen, an AHCA Analyst; $29,737.50 for Dr. James True Martin, a physician consultant; $2602.85 for court reporting services; and $1054.63 for an AHCA attorney's travel expenses to attend depositions. (Actually, these items total $34,036.31.)
By Order entered on September 30, 2013, AHCA remanded the case to DOAH "for an evidentiary hearing on the issue of costs."
On December 16, 2013, Respondent filed a Representative[']s Response [to] Petitioner's Remand to ALJ for Recovery of Expert Witness Costs and Brief [in] Support of Respondent's Request for a Full Review of Petitioner's Remand for Evidentiary Hearing on Recovery of Costs. These filings cite Respondent's objections to the assessment of costs in connection with Dr. Martin, who is the neurologist whom Petitioner retained as a peer reviewer and expert witness in DOAH Case No. 10-9318MPI. Neither of these filings objects to the other costs cited in the Motion for Remand.
At the hearing, Petitioner offered evidence of its costs for its statistical consultant, Dr. Fred Huffer. The Motion for Remand does not mention this cost item. The first notice that Petitioner provided Respondent of this cost item was in a letter dated January 13, 2014--nine days before the final hearing--that is styled, "Amended Costs Assessment." Citing the Final Order's direction to the parties to try to settle the issue on the amount of costs, the January 13 letter states that it is a "good faith attempt to confer regarding the costs in this case."
Regardless of the January 13 letter's status as a good faith attempt to comply with the directive of the 2011 Final Order, the letter is an untimely attempt to notify Respondent of a new cost item that he must defend. Petitioner's failure to request leave to amend the Motion for Remand, as required by Florida
Administrative Code Rule 28-106.102, further undermines the utility of the January 13 letter as a notice of a new claim. See Belleau v. Dep't of Envtl. Prot., 695 So. 2d 1305, 1307 (Fla. 1st DCA 1997) (per curiam) (otherwise-allowable investigative costs disallowed due to lack of claim in charging document). Thus, the Administrative Law Judge ruled at the hearing that Petitioner could not assess Dr. Huffer's costs, which were claimed to be
$450. (Tr. 255-59.)1/
At the hearing, Petitioner called six witnesses: Sandra Haynes, Jennifer Ellingsen, Dr. Martin, Gregory Riley, Sharon Dewey, and Robi Olmstead. Petitioner offered into evidence seven exhibits. Referring to Petitioner's Bates-stamped binder of exhibits, the exhibits are Petitioner Exhibit 1--pages 40-44; Petitioner Exhibit 2--pages 4-11; Petitioner Exhibit 3--pages
; Petitioner Exhibit 4--pages 82-85; Petitioner Exhibit
5--pages 49-50; Petitioner Exhibit 6--pages 64-81; and Petitioner Exhibit 7--pages 55-63. Respondent called no witnesses and offered into evidence one exhibit: Respondent Exhibit 1. All exhibits were admitted.
The Administrative Law Judge took official notice of the record on appeal of the Final Order. This record is contained in a CD that has been sealed to preserve the confidentiality of unredacted patient information contained in the record.
The court reporter filed the transcript on February 10, 2014. Respondent filed his closing statement on February 18, 2014, and Petitioner filed its proposed recommended order on
February 20, 2014.
FINDINGS OF FACT
Respondent is a Medicaid provider. Following an audit of the period of January 1, 2007, through June 30, 2008, Petitioner issued a Final Audit Report on August 16, 2010 (FAR).
In the FAR, Petitioner determined that Respondent owed
$123,393.06 in overpaid reimbursements, $5000 in administrative fines for violations of Florida Administrative Code
59G-9.070(7)(c) and (e), and $5658.09 in audit costs. The overpayments were extended from an audit of 30 recipients. For these recipients, the FAR claims that Respondent had received overpayments on 59 claims of the 237 claims that it had submitted during the audit period.
Respondent requested an administrative hearing, so Petitioner transmitted the file to DOAH, where the case was assigned DOAH Case No. 10-9318MPI. Following a hearing on April 4 and 5, 2011, the undersigned Administrative Law Judge entered a recommended order on May 19, 2011 (Recommended Order).
The Recommended Order, which is described in more detail below, states that Petitioner may recover its investigative, legal, and expert witness costs under section 409.913(23)(a).
However, the Recommended Order includes no findings on these cost items because Petitioner presented no proof of these costs at the hearing.
The Final Order adopts nearly all of the findings and conclusions of the Recommended Order. The Final Order directs Respondent to repay $105,353.06 in overpayments and $4000 in administrative fines. The Final Order adds:
Additionally, pursuant to § 409.913(23)(a), Fla. Stat., costs shall be assessed against the Respondent in an amount that reflects the actual investigative, legal, and expert witness costs. The parties shall attempt to stipulate to the costs related to the investigation and prosecution of this case.
In the event that the parties cannot so stipulate, this issue shall be remanded to the Division of Administrative Hearings for an evidentiary hearing . . . .
The Final Order was affirmed on appeal in
Case 1D11-4728, which the Administrative Law Judge has officially noticed. Tobias v. Ag. for Health Care Admin., 93 So. 3d 1020 (Fla. 1st DCA 2012) (per curiam). Among the other issues raised by Respondent in its initial and reply briefs were two of relevance to the present case: whether Dr. Martin possessed the expertise to testify that Respondent erroneously coded claims arising from procedures using the Axon-II medical device and whether Petitioner could pursue costs in a subsequent proceeding after failing to prove its costs at the hearing in DOAH Case
No. 10-9318MPI. Respondent's failure to prevail on these two
issues on appeal precludes his reassertion of these issues in the present case.
The total court reporter fees that Petitioner seeks to recover is $2604.85 (not $2602.85, as shown in the motion). These fees comprise $254.12 for services in connection with Respondent's deposition, which was transcribed; $68.25 for services in connection with the depositions of two of Respondent's expert witnesses, which were not transcribed; and
$2282.48 for services at the two-day final hearing, which was transcribed. These costs are all reasonable, and Petitioner has paid these invoices.
The total legal costs that Petitioner seeks to recover are travel expenses of its attorney in the amount of $1054.63. These costs comprise $546.11 for a rental car, gas, tolls, and the per diem of the attorney to take the deposition of an expert witness in Boynton Beach and $508.52 for a rental car, gas, tolls, and the per diem of the attorney to take the deposition of Respondent in Stuart. These costs are reasonable, and Petitioner has paid these costs or incurred them as part of its general administrative expenses. Petitioner has not sought to recover as costs any portion of its attorney's salary and benefits that are allocable to the prosecution of DOAH Case No. 10-9318MPI.
The total investigative costs that Petitioner seeks to recover are $154 for a registered nurse consultant and $487.33
for a program analyst, both of whom were employed by Petitioner at the time in question. The registered nurse consultant worked seven hours on the case at the rate of $22 per hour. The program analyst worked 24.75 hours on the case at the rate of $19.69 per hour. These costs are reasonable, and Petitioner has incurred these costs as part of its general administrative expenses.
The total investigative and expert witness costs of Dr. Martin involve his work prior to and after the transmittal of the case to DOAH. Dr. Martin is a highly experienced neurologist who assisted Petitioner during the audit and at hearing.
Dr. Martin's normal hourly rates are $300 for nontrial work and an average of $450 for trial work. For Petitioner, Dr. Martin charges hourly rates of $150 for nontrial work and
$300 for trial work. These rates are reasonable.
The costs in dispute in this case are reflected in four invoices totaling $29,737.50 that Dr. Martin submitted to Petitioner and Petitioner has paid. These four invoices are the second through fifth invoices that Dr. Martin submitted to Petitioner, which is not seeking to assess the costs of the first of Dr. Martin's invoices. Respondent has specifically contested all of Dr. Martin's costs for which Petitioner seeks reimbursement.
Typically, Petitioner submits medical records to its peer reviewer. The peer reviewer examines the records and
completes worksheets allowing, denying, or adjusting each claim for the sampled recipients during the audit period. The peer reviewer then returns the records and completed worksheets to Petitioner.
This process occurred three times in the present case.
In November 2009, Petitioner obtained Respondent's medical records and forwarded them to Dr. Martin. In January 2010, Dr. Martin returned to Petitioner the medical records and completed worksheets. In the worksheets, Dr. Martin noted some discrepancies in the testing for which Respondent had been
reimbursed. At this time, Dr. Martin submitted his first invoice in the amount of $3000 for 20 hours' work. Petitioner paid the invoice. Because Petitioner elected not to present this invoice as part of the costs in this case, the Administrative Law Judge has not assigned any of these 20 hours to Dr. Martin's work on the Axon-II test, which is described in detail below.
Between January and May 2010, Petitioner obtained clarification concerning Medicaid policy for reimbursing claims arising out of the use of a device similar to the Axon-II device, if not this device itself. Petitioner submitted medical records a second time to Dr. Martin in May 2010. This submittal included some additional medical records that Petitioner had since received from Respondent, as well as a communication, in some form, of Medicaid policy prohibiting the reimbursement of claims
arising out of the use of a device similar to the Axon-II device, if not this device itself. At this time, Dr. Martin examined closely the question of the reimbursability of claims arising out of the use of a device similar to the Axon-II device, if not this device itself.
According to Dr. Martin, the Centers for Medicare and Medicaid Services (CMS) had determined in 2002 and 2004 that claims of this type were not eligible for reimbursement under Medicaid. Nonetheless, Dr. Martin testified that the issue was not entirely clear. Dr. Martin examined materials contemporaneous to the CMS determinations in 2002 and 2004 to understand the grounds for the ineligibility determination. He also examined materials, both provided by Respondent and available on the internet, to understand the details of the Axon- II testing. It is not entirely clear when Dr. Martin performed all of this work, but at least part of it took place in May 2010.
Thus, work on the issue of the reimbursability of claims arising from the use of the Axon-II device was included in the second invoice, which is dated May 20, 2010, for $2137.50. The only item on this invoice is "Review Records." The invoice discloses 14.25 hours, but provides no dates of services.
Dr. Martin's third examination of Respondent's medical records took place in late June 2010. The record does not indicate exactly what new information was available at this time,
but it is likely that Respondent provided more literature on the Axon-II device.
The third invoice, which is dated July 20, 2010, is for
$3150. The only item on this invoice is "Review Records." The invoice discloses 21 hours in July 2010.
By the time of the third invoice, Dr. Martin had concluded his research into the requirements for neural testing to be coded Current Procedural Terminology Manual (CPT) 95904, which is how Respondent coded its Axon-II procedures, and the details of Axon-II testing. Based on Dr. Martin's work, the next month, Petitioner issued the FAR, which disallowed all of the claims based on Respondent's use of the Axon-II device.
The FAR cites a CMS publication that, as of June 18, 2004, discusses sensory neural conductivity threshold tests (sNCTs), which are discussed below. The cited CMS publication states that sNCTs "are different and distinct from assessment of nerve conduction velocity, amplitude and latency" and that reimbursement claims of sNCTs under CPT 95904, which is for a Sensory Nerve Conduction Test, are "erroneous and are therefore denied." This CMS publication definitively settled the main reimbursement dispute in DOAH Case No. 10-9318MPI.
Prior to considering the fourth of Dr. Martin's invoices at issue in this case, it is necessary to place his valuable work in perspective. DOAH Case No. 10-9318MPI did not
present the time-consuming array of factual issues typically seen in Medicaid overpayment cases. Instead, the case presented itself as essentially a one-issue case--the reimbursability of the Axon-II testing.
Of the 59 claims in dispute, six claims were coded CPT 95934, which is for an H-Reflex Test. There was no dispute that these claims should not have been billed: Respondent admitted that an inexperienced employee had miscoded six claims
for other procedures with the CPT for an H-Reflex Test. The sole question was whether the overpayments for these claims should be extended from the sample to the universe. Respondent claimed that they should not be because he had timely corrected the misbillings. Petitioner claimed that they should be because Respondent had not timely corrected the misbillings.
The Administrative Law Judge found that the billings should be removed from the sample, but Petitioner overturned this finding in the Final Order. Notwithstanding the different treatment given these six claims by the Administrative Law Judge and Petitioner, the analysis of these claims was straightforward and involved little, if any, of Dr. Martin's time.
Of the remaining 53 claims in dispute, nine were a routine assortment of typical overpayment issues, such as whether a billed procedure was upcoded or medically necessary. Although the Administrative Law Judge resolved seven of these nine
disputed claims differently than their treatment in the FAR, the analysis of these nine claims was also straightforward and required little more time of Dr. Martin than the analysis of the misbilled claims for H-Reflex Tests.
All of the remaining 44 claims raised the Axon-II reimbursement issue. Analysis of these 44 claims required no consideration whatsoever of individual patients. These 44 disputed claims required instead a single determination of whether Respondent was entitled to reimbursement for neural testing that he performed using an Axon-II device. Notwithstanding Dr. Martin's claim that the issue was not entirely clear, the Administrative Law Judge found, in the underlying case, that the denial of these 44 claims did not demand much analysis.
Rejecting Respondent's billing of these 44 claims under CPT 95904, Petitioner properly denied all of these claims as erroneously coded because they did not meet the criteria of CPT 95904. Petitioner correctly determined that these claims were properly classified under CPT 95999, which is for unlisted neurological diagnostic procedures, or CPT G0255, which is a unique code for sNCTs. Procedures bearing either of these codes are not reimbursable under Medicaid.
Although some time is required to understand the details of the neural testing provided by the Axon-II device and
how it fails to meet the requirements of CPT 95904, the ultimate facts are straightforward. The Recommended Order covers these matters in only eight paragraphs of findings of fact covering three pages.
These findings state that CPT 95904 requires that a device measure a nerve's response in terms of amplitude and "latency/velocity."2/ The findings explain that amplitude is a measure of size and latency is a measure of the time of travel, so that, if the travel distance is known, the velocity can be derived from the latency. These findings state that the Axon-II device measures amplitude, but not latency or velocity. These findings conclude that Respondent's procedures thus did not fall within CPT 95904, as billed, but within CPT 95999 or CPT G0255. These findings note that CMS created CPT G0255 for sNCTs to ensure that claims for such services would be denied as medically unnecessary and that, on March 19, 2004, CMS revised its National Coverage Determinations Manual to reinforce CMS's position that claims for tests measuring amplitude, latency, or velocity are not reimbursable.
Dr. Martin's fourth invoice is dated January 11, 2011, for $17,925. The first item on this invoice is: "Phone call with Bill Porter," who was an attorney with Petitioner. For this item, the invoice discloses one hour on December 8, 2010. The total of this item is $150. The second item on this invoice is:
"Research in prep for legal case." For this item, the invoice discloses 115 hours, but no dates of service. The total of this item is $17,250. The last item on this invoice is: "Meeting with analyst, nurse and two agency lawyers preparing for trial and depositions." For this item, the invoice discloses 3.5 hours--from 9:00 a.m to 12:30 p.m.--on January 11, 2011. The total of this item is $525.
The one- and three-hour items are routine and reasonable. They require no further discussion.
The 115-hour item is, in its entirety, unreasonable because it is unnecessary and excessive. As such, this item is not even causally related to the investigation or prosecution of this case, at least not in any meaningful way.
The 115-hour item bears no date and hardly any description. This block of time totaling nearly three weeks occurred after the issuance of the FAR in August 2010. Not only was 35.25 hours the maximum reasonable amount of time necessary to fully dispose of all disputes, after the issuance of the FAR, there was no work remaining, except as noted below, due to the relative simplicity of the Medicaid overpayment case.
The fifth and final invoice, which is undated, is for a total of $6525. The first item on this invoice is: "Trial prep: Review of Neural scan, Medicare rulings, FDA approval, patients[.]" The invoice discloses 11 hours from March 30
through April 3, 2011, for these items. The total of this item is $1650. The second item is: "Review CPT Codes[.]" The invoice discloses 3.5 hours from March 30 through April 3, 2011, for this item. The total of this item is $525. The third item is "[Prehearing] conf with Mr. Porter." For this item, the invoice discloses one hour on March 30, 2011. The total of this item is $150.
The fourth item is "Conference with Jeff Duval and Monica," who were attorneys for Petitioner. For this item, the invoice discloses 3.5 hours on April 3, 2011. The total of this item is $525. The fifth item is "Pre-Depo conference with Monica." For this item, the invoice discloses 0.5 hour on March 29, 2011. The total of this item is $75. The sixth item is "Hearing." For this item, the invoice discloses 12 hours on April 4-5, 2011, so the total of this hearing time is $3600.
It was not unreasonable for Dr. Martin to devote an additional--and final--11 hours from March 30 through April 3, 2011, to revisit his earlier conclusions and refamiliarize himself with his prior research. The hearing started the following day, so this work was useful for preparing direct and cross-examination. As indicated by the invoice, Dr. Martin reviewed materials on neural scans, CMS rulings, and FDA approvals. The remaining time on the fourth invoice was also reasonable.
In summary, all of Dr. Martin's time shown on the second through fourth invoices, except for the 115 hours, was reasonable. Reducing the costs attributable to Dr. Martin by 115 hours times $150 per hour would yield a total of $17,250. The resulting net cost for Dr. Martin's time thus would be
$12,487.50. With this adjustment, Petitioner would have proved recoverable costs of $16,788.31.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction. §§ 120.569 and 120.57(1), Fla. Stat.
Section 409.913(23) provides:
In an audit or investigation of a violation committed by a provider which is conducted pursuant to this section, the agency is entitled to recover all investigative, legal, and expert witness costs if the agency's findings were not contested by the provider or, if contested, the agency ultimately prevailed.
The agency has the burden of documenting the costs, which include salaries and employee benefits and out-of-pocket expenses. The amount of costs that may be recovered must be reasonable in relation to the seriousness of the violation and must be set taking into consideration the financial resources, earning ability, and needs of the provider, who has the burden of demonstrating such factors.
The provider may pay the costs over a period to be determined by the agency if the agency determines that an extreme hardship would result to the provider from immediate full payment. Any default in payment of
costs may be collected by any means authorized by law.
The standard of proof is a preponderance of the evidence. § 120.57(1)(j).
The Final Order has determined that Petitioner "ultimately prevailed," as required by section 409.913(23)(a), so the sole question is the amount of costs to which it is entitled.3/
Two issues arise as to the costs of Dr. Martin. First, Respondent produced no evidence, such as from an expert witness, establishing the unreasonableness of the amount of time that Dr. Martin testified that he had spent on the underlying case. However, the absence of expert testimony questioning the reasonableness of the amount of Dr. Martin's time is no impediment to the above-stated findings that 115 hours of his time was unreasonable because it was unnecessary and excessive. See, e.g., Wiederhold v. Wiederhold, 696 So. 2d 923 (Fla. 4th DCA 1997) (per curiam) (dictum).
The more important issue, though, is whether Petitioner is limited to costs that are reasonable in amount. As Petitioner points out in its proposed recommended order, section 409.913(23) directs the assessment of "all" investigative, legal, and expert witness costs. Section 409.913(23) imposes no limitation that the costs be reasonable.
Perhaps in an abundance of caution, Petitioner also argues in its proposed recommended order that its costs, including those involving Dr. Martin, were "necessary and reasonable." In connection with this argument, Petitioner acknowledges a requirement that expert witness costs be "necessary and reasonable" and cites as authority the case, Gray v. Bradbury, 668 So. 2d 296 (Fla. 1st DCA 1996). For this principle, Gray cites Powell v. Barnes, 629 So. 2d 185 (Fla. 5th DCA 1993), which cites Lafferty v. Lafferty, 413 So. 2d 170 (Fla. 2d DCA 1982). Lafferty clearly reveals the source of this principle as section 92.231.
In 2003, the legislature amended section 92.231(2) to remove the limitation of reasonableness on the imposition of expert witness costs. See Ch. 2003-402, § 28, Laws of Fla. Since this change in the law, the sole authority for the limitation of reasonableness on the imposition of expert witness costs has been Amendments to Uniform Guidelines for Taxation of
Costs, 915 So. 2d 612, 616 (Fla. 2005) (Guidelines). See, e.g., Winter Park Imports, Inc., v. J.M. Family Enterprises, Inc.,
77 So. 3d 227, 231-32 (Fla. 5th DCA 2011).
But Guidelines applies to legal actions, not administrative proceedings. An agency may adopt Guidelines by rule. See, e.g., Martin v. Code Enforcement, 122 So. 3d 438 (Fla. 1st DCA 2013) (rule applicable to workers' compensation
proceedings incorporates Guidelines). But nothing in Florida Administrative Code chapter 28-106 applies Guidelines to administrative proceedings conducted under chapter 120, Florida Statutes.
Section 409.913(23) imposes two limitations on the costs that Petitioner may recover, but they are not applicable to this case. Section 409.913(23)(b) requires that the total costs be reasonable in relation to the "seriousness of the violation." Barring evidence that, say, upcoding is inherently more serious than a lack of medical necessity, the seriousness of violations in a typical Medicaid overpayment case is best measured by the total overpayments plus the fine. The Final Order establishes total overpayments of about $105,000 plus administrative fines of
$4000. If Dr. Martin's fees were to be awarded as billed, the total costs would be a little over $34,000, which, absent evidence to the contrary, does not impress the Administrative Law Judge as unreasonable in relation to the seriousness of the violations. Thus, this limitation is not applicable to the present case.
Section 409.913(23)(b) requires that the total costs be set taking into consideration the "financial resources, earning ability, and needs of the provider." There is no evidence concerning these matters. Section 409.913(23)(b) imposes the burden on Respondent to prove these items and show that the cost
award must be reduced, if so indicated by these factors. Thus, this limitation is not applicable to the present case.
If, under these circumstances, a court would not impute a limitation of reasonableness to the investigative or expert witness costs authorized by section 409.913(23), the same result could be achieved by determining that unreasonable--i.e., excessive or unnecessary--costs were not causally linked to the Medicaid overpayment case for which the costs are sought. For example, a peer reviewer might spend a substantial amount of time downcoding claims on an erroneous reading of the CPT; the expert might mistakenly think that the billed CPT requires three of three factors when it requires only two of three factors. Such time would be an actual investigative or expert witness cost, but, due to the peer reviewer's misunderstanding of the CPT requirements, it would not be a reasonable or necessary investigative or expert witness cost. If reasonableness were not a limitation on recoverable costs, this time could be excluded from recoverable costs on the alternative ground that it is not causally linked to the costs of investigating and prosecuting the overpayment case.
In this manner, the 115 hours of Dr. Martin's time discussed above are not causally linked to the costs of investigating and prosecuting the overpayment case. After Dr. Martin expended the 35.25 hours described above, the 115
hours of additional research on CPT 95904 and the Axon-II device bore no casual relationship to the investigation and prosecution of the overpayment case.
The obvious dilemma between applying the statute as it plainly reads or preventing Petitioner from recovering unreasonable costs is further complicated by the fact that a Conclusion of Law incorporating the latter option4/ would possibly subject Petitioner to the time and expense of an appeal in order to obtain the contrary legal conclusion.5/ Given the lack of explicit authority to impute a limitation of reasonableness, the Administrative Law Judge believes that Petitioner should be free to determine whether to so interpret section 409.913(23).
The remaining costs are authorized under section 409.923(23). The costs associated with the nurse consultant and analyst are investigative costs. The costs of the court reporter are legal costs. The travel expenses of the attorney are not normally recoverable. Guidelines at 617. However, "out-of- pocket expenses" are specifically allowed by section 409.913(23)(b). Also, even though specifically allowed by section 409.913(23)(b), Petitioner has not sought to recover its attorney's salary and benefits allocable to the prosecution of DOAH Case No. 10-9318MPI, but only those travel expenses, authorized by section 112.061, associated with two short trips by the attorney for depositions. Lastly, as noted above, Respondent
has not challenged any cost item except Dr. Martin's expert witness fees. For these reasons, the travel expenses of Petitioner's attorney are recoverable.
Lastly, section 409.913(23)(c) provides for installment payments, if Petitioner determines that "extreme hardship" would result from immediate payment in full. The record provides no basis for this determination, nor is Respondent entitled to another point of entry on this issue, which could have been litigated in the final hearing already conducted in the present case. However, if Petitioner subsequently determines that installment payments would have otherwise been appropriate, nothing in this recommended order should be construed to prevent Petitioner from providing for Respondent's payment of costs in installments.
It is
RECOMMENDED that Petitioner enter a final order assessing Respondent costs of $34,036.30 or $16,788.31, if Petitioner determines that its costs must be limited to those that are reasonable or, in the alternative, causally linked to the investigation and prosecution of the underlying case.
DONE AND ENTERED this 24th day of February, 2014, in Tallahassee, Leon County, Florida.
S
ROBERT E. MEALE
Administrative Law Judge
Division of Administrative Hearings The DeSoto Building
1230 Apalachee Parkway
Tallahassee, Florida 32399-3060
(850) 488-9675
Fax Filing (850) 921-6847 www.doah.state.fl.us
Filed with the Clerk of the Division of Administrative Hearings this 24th day of February, 2014.
ENDNOTES
1/ This ruling proved to be less consequential than it seemed because the January 13 letter more than offset the costs of
Dr. Huffer with a reduction of $555 in the costs associated with attorney Ryan.
2/ This inartful construction probably means latency and velocity, but, even if the slash meant "or," the Axon-II device would not qualify because, as noted immediately below, it measures neither latency nor velocity.
3/ As noted above, the Final Order directs that "costs shall be assessed." If this were not the meaning of this language in the Final Order or if, on judicial review, a court were to determine that Respondent were entitled to be heard prior to the making of this determination, this recommended order would have concluded that Petitioner "ultimately prevailed," pursuant to section 409.913(23)(a), because Petitioner prevailed on all significant issues in DOAH Case No. 10-9318MPI. The party "prevailing on the significant issues in the litigation is the party that should be considered the prevailing party." Moritz v. Hoyt Enter., Inc., 604 So. 2d 804, 810 (Fla. 1992) (attorneys' fees).
4/ It is not so much that the Administrative Law Judge prefers this option that he is strongly disinclined to enter a Conclusion of Law allowing Petitioner to impose unreasonable, unnecessary, and excessive costs.
5/ Section 120.57(1)(l) (second sentence) provides that the agency may freely reject the Administrative Law Judge's Conclusions of Law over which the agency has "substantive jurisdiction." A good argument exists that construction of its cost statute is within the substantive jurisdiction of Petitioner. Like § 409.913(17), which requires Petitioner to consider numerous factors in determining administrative sanctions against a noncompliant Medicaid provider, § 409.913(23) vests in Petitioner considerable authority in limiting the impact of costs on a Medicaid provider by considering the seriousness of the violations, the impact of costs on the provider's financial resources, and the payment of assessed costs in installments.
However, in G. E. L. Corp. v. Dep't of Envtl. Prot., 875 So.
2d 1257, 1263-64 (Fla. 5th DCA 2004), the court held that an attorney's fee statute in chapter 120 was not within the agency's substantive jurisdiction. Here, the cost statute is within chapter 409 and, as noted in the preceding paragraph, its interpretation requires Petitioner to exercise its expertise in delineating the precise responsibilities of Medicaid providers.
But the obvious resemblances between statutes to recover costs and attorney's fees casts doubt on how a court may resolve the question of whether the construction of § 409.913(23) is within the substantial jurisdiction of Petitioner.
COPIES FURNISHED:
David W. Nam, Esquire
Agency for Health Care Administration Fort Knox Building 3, Mail Stop 3 2727 Mahan Drive, Suite 3431
Tallahassee, Florida 32308
Hal M. Tobias
901 Southeast Monterey Commons Boulevard Stuart, Florida 34996
Ron F. Davis
2227 West Main Street, Suite 3
Jacksonville, Arkansas 72076
Richard J. Shoop, Agency Clerk
Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3
Tallahassee, Florida 32308
Stuart Williams, General Counsel Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3
Tallahassee, Florida 32308
Elizabeth Dudek, Secretary
Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 1
Tallahassee, Florida 32308
NOTICE OF RIGHT TO SUBMIT EXCEPTIONS
All parties have the right to submit written exceptions within
15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the Final Order in this case.
| Issue Date | Document | Summary |
|---|---|---|
| Mar. 27, 2014 | Agency Final Order | |
| Feb. 24, 2014 | Recommended Order | AHCA limited to reasonable investigative and expert witness costs. |
