vs.
OCTAVIO J. CARRENO, M.D.,
Respondent.
Case No. 17-0130MPI
Pursuant to notice, this cause was heard on April 5, 2017, by video teleconference in Tallahassee and Miami, Florida, by Robert L. Kilbride, the assigned Administrative Law Judge of the Division of Administrative Hearings ("DOAH").
For Petitioner: Joseph G. Hern, Esquire
James B. Countess, Esquire
Whether Octavio J. Carreno, M.D. ("Respondent" or "Dr. Carreno"), is liable to the Agency for Health Care
Administration ("AHCA," "Agency," or "Petitioner") for an overpayment in the amount of $121,641.42 for certain claims for services during the audit period of January 1, 2012, through December 31, 2014, that in whole or in part were not covered by Medicaid.
Whether Respondent is liable to Petitioner for a sanction in the amount of $24,328.28 pursuant to Florida Administrative Code Rule 59G-9.070(7)(e).
Whether Respondent is liable to Petitioner for Petitioner's incurred investigative, legal, and expert witness costs, which Petitioner contends it is entitled to recover pursuant to section 409.913(23)(a), Florida Statutes (2014).
Petitioner performed an audit of Respondent's Medicaid billing and payment records for the period January 1, 2012, through December 31, 2014, and determined that Respondent had received an overpayment of Medicaid funds in the amount of
$139,250.66.
The Agency issued its Final Audit Report ("FAR") on March 15, 2016, notifying Respondent of the audit findings and conclusions. It imposed a sanction for failure to comply with the Medicaid rules in the amount of $27,850.13 pursuant to
rule 59G-9.070(7)(e) and sought costs incurred as a result of the audit.
The amounts of the overpayment and sanction were revised and reduced, after the FAR was issued, to $121,641.42 and $24,328.28, respectively.
Respondent disputed the Agency determination described in the FAR by timely filing a Petition for Formal Administrative Hearing. Thereafter, the Agency referred the case to DOAH, and the matter was assigned DOAH Case No. 16-4669MPI.
At the parties' request, an Order Closing File and Relinquishing Jurisdiction was entered on November 22, 2016. Upon motion by the parties, the case was later re-opened at DOAH and reassigned as DOAH Case No. 17-0130MPI.
On January 23, 2017, a Notice of Hearing by Video Teleconference was filed, setting the hearing for April 5, 2017. On April 5, 2017, the parties filed an Amended Joint Prehearing Stipulation ("JPS").
At the final hearing, Petitioner offered Exhibits 1 through 19, a voluminous collection of medical and audit documents, all of which were admitted into evidence. Respondent offered Exhibits 1 through 3, which were admitted into evidence as well.
Petitioner called as witnesses Ms. Robi Olmstead, AHCA administrator, and Ellen D. Silkes, M.D. Respondent testified on his own behalf and called Yusleidys Couret and Lorraine Molinari as witnesses.
A Transcript of the final hearing was filed on April 21, 2017. Post-hearing proposed recommended orders were timely submitted by the parties. Each was carefully reviewed and given due consideration in the preparation of this Recommended Order.
References to Florida Statutes are to the 2014 version, unless otherwise indicated.
Based on the evidence presented at the hearing, and the record as a whole, the undersigned makes the following findings of material and relevant facts:
Petitioner is designated as the single state agency authorized to make payments for medical assistance and related services under Title XIX of the Social Security Act. This program of medical assistance is referred to as the "Medicaid program." See § 409.902, Fla. Stat.; JPS ¶ E12.
Petitioner has the responsibility for overseeing and administering the Medicaid program for the state of Florida, pursuant to section 409.913. JPS ¶ E13.
The Medicaid provider agreement is a voluntary contract between AHCA and Respondent. An enrolled Medicaid provider must comply fully with all state and federal laws pertaining to the Medicaid program, including Medicaid provider handbooks incorporated by reference into rule, as well as all federal,
state, and local laws pertaining to licensure to receive payment from the Medicaid program. JPS ¶ E14.
During the audit period, Respondent was an enrolled Medicaid provider and had a valid Medicaid provider agreement with AHCA, Medicaid Provider No. 002993600. JPS ¶ E2; Pet. Ex. 1.
AHCA's Bureau of Medicaid Program Integrity ("MPI"), pursuant to its statutory authority, conducted an audit of Respondent for Medicaid claims it paid to him for medical services he provided to Medicaid recipients, occurring during the time period from January 1, 2012, through December 31, 2014.
JPS ¶¶ E1 and E4.
AHCA issued a FAR dated March 15, 2016, MPI Case ID No. 2015-0003243, alleging that Respondent was overpaid
$139,250.66 for certain services that are not covered by Medicaid. In addition, the FAR informed Respondent that AHCA was seeking to impose a fine of $27,850.13 as a sanction for violation of rule 59G-9.070(7)(e) and seeking costs pursuant to section 409.913(23). The amounts of the overpayment and the sanction were revised, after the FAR was issued, to $121,641.42 and $24,328.28, respectively. JPS ¶ E5.
The FAR, supported by the Agency work papers, constitutes evidence of the overpayment to Respondent pursuant to section 409.913(22). JPS ¶ E15.
In the FAR section entitled "Findings," AHCA set forth the bases for the overpayment determinations. JPS ¶ E6.
The claims which make up the overpayment alleged by AHCA were filed by and paid to Respondent prior to the initiation of this action. JPS ¶ E7.
There is no dispute from Respondent as to the process of the statistical sampling or the statistical methods utilized to establish the validity of the overpayment calculation utilized by AHCA. JPS ¶ E16.
Additional Facts Adduced at the Hearing
Ms. Robi Olmstead, an administrator of the Practitioner Unit at AHCA, under the Offices of the Inspector General, MPI, testified regarding her experience and role in the audit of Respondent.
MPI is required by federal and Florida law to investigate medical providers for fraud, abuse, or overpayments.
Olmstead cited section 409.913 as the authority to investigate Medicaid providers, including Respondent. The instant case against Respondent was opened based on a referral from one of the investigators who noticed "a significant portion of Dr. Carreno's office visits" (evaluation and management or "E&M" codes) were billed at high levels. Olmstead also independently confirmed this in her review of the data.
Olmstead opened the audit, set the coverage dates of the audit period, and assigned the matter to an AHCA investigator. The investigator obtained a list of claims for
40 random recipients from the Agency's cluster sample program.
After the sample was obtained, Petitioner then requested the medical records of the sample recipients from Respondent. Pet. Ex. 2.
Petitioner utilized the services of a peer consultant, Ellen D. Silkes, M.D. Dr. Silkes meets the requirements and qualifications of a "peer" as defined in section 409.9131. JPS
¶ E17. Dr. Silkes practices the same specialty or sub-specialty as Respondent and is licensed under the same chapter. Pet.
Ex. 6, p. 147. Both Dr. Silkes and Dr. Carreno are otolaryngologists, commonly referred to as ear, nose, and throat ("ENT") doctors.
The medical records received from Respondent were reviewed by the AHCA investigator and by an AHCA registered nurse consultant and then sent to the peer reviewer, Dr. Silkes, along with other relevant documents, including the worksheets generated by the claims sample process.
When the medical records were returned to the Agency with the peer's comments, the Agency calculated the amount of the overpayments.
The peer reviewer's role is to make determinations of medical necessity and levels of service. Decisions as to the lack of documentation are made by a combination of the peer reviewer and the Agency nurse consultant.
After the agency and peer review were completed, a Preliminary Audit Report ("PAR")(Pet. Ex. 4) was sent to Respondent on December 14, 2015.
After the receipt of the PAR, Respondent had the opportunity to submit additional medical records to the Agency for consideration. This was done by Respondent.
The FAR (Pet. Ex. 5) was then issued on March 15, 2016.
The FAR made multiple findings delineating the reasons for the overpayments, including improper "consult" claims, reductions for levels of service, insufficient or no documentation to support claims, improper claims for global procedures, errors in coding, and lack of medical necessity for certain procedures. Pet. Ex. 5, pp. 88-90.
Subsequent to the FAR and prior to the final hearing, the review of additional information provided to the Agency by Respondent resulted in a reduction of the alleged overpayment to
$121,641.42. JPS ¶ A; Pet. Ex. 19.
Rule 59G-9.070(7)(e) addresses sanctions for failure to comply with the provisions of the Medicaid laws. For a first offense, there is a $1,000.00 fine per claim found to be in
violation. AHCA initially found 86 violations. Pet. Ex. 6. After the state mandated cap of 20 percent was applied, the initial fine was set by the Agency at $27,850.13. Subsequently, based on the allowance of some claims submitted by Respondent with additional documents or clarification, the fine amount was reduced to $24,328.28. Pet. Ex. 19.
The Agency considered all of the statutory factors when assessing the sanction. Olmstead considered the violations in this case to be "typical" and "nothing extraordinary" and did not enhance or reduce the sanctions.
The Agency incurred costs in its investigation of this matter. However, costs have not yet been fully determined. Pet. Ex. 5, p. 150B.
Based on Olmstead's experience, the audit was conducted in a routine and acceptable manner.
Identification of the Disputed Claims
Notably, in the JPS and again at hearing, the parties agreed that only the following "Disputed Claims" required factual findings and conclusions of law by the undersigned:
Recipient #2 Claims 1, 2 and 3
Recipient #3 Claims 5, 11, 12,
13, 17, 18, 20, 21,
22, 24, 26, 28, 35
Recipient #25 Claim 11
Recipient #29 Claim 6
Recipient #30 Claims 1, 2, 4
None of the other audit determinations made by AHCA were challenged by Respondent at the hearing.1/
The parties agreed at the start of the hearing that the downward adjustments made by AHCA to Recipient #2, Claims 1 and 2, were agreed to and would not be disputed. The worksheets, as revised, now showed the peer's determination of those claims as properly payable at Current Procedural Terminology ("CPT") Code 99213. Pet. Ex. 19.
Evaluation and Management Claims
Many of the "Disputed Claims" are for E&M services, which are office visits, and specifically in this audit, office visits for established patients of Respondent.
In order to properly code and bill the appropriate level of E&M services for an encounter with an established patient, the medical records must establish that two of the three key components (i.e., history, examination, and medical decision- making) meet or exceed the stated requirements of that level of service. In some cases, time spent with the patient is considered a key factor as well. Pet. Ex. 13, p. 271.
For encounters with established patients, the CPT Code (2012) provides in pertinent part, as follows:
99212 - Office or other outpatient visit for the evaluation and management of an established patient, which requires at least
2 of these three key components:
There was no evidence to suggest that the CPT codes for these procedures changed at any time during the audit period between 2012 and 2014. As a result, the CPT codes admitted were properly relied upon by the parties. Pet. Ex. 13.
As mentioned, the key components of coding an E&M encounter are the examination, the history, and the medical decision-making required of the physician. Pet. Ex. 13.
The CPT codes from 99211 to 99215 are also referenced as Levels 1 through 5 with the main difference being the complexity and extent of the visit and examination.
Counseling and/or coordination of care with the patient and/or family can be a controlling factor in coding the proper level. However, the CPT code notes provide that the "extent of counseling and/or coordination of care must be documented in the medical record." Pet. Ex. 13, p. 271.
The Florida Medicaid Provider General Handbook provides that "[m]edical goods or services are excessive or not medically necessary unless both the medical basis and the specific need for them are fully and properly documented in the recipient's medical records." Pet. Ex. 9, pp. 169-173.2/
The undersigned undertook a careful and meticulous review of the record. This included reading Transcript testimony, reviewing manuals and handbooks provided, and comparing and cross-referencing the hearing testimony to the worksheets and handwritten medical notes and other records prepared by Respondent.
Findings of Fact on Disputed Claims
Recipient #2, Claim 3. Respondent submitted this claim using CPT Code 69200. Pet. Ex. 15-2, p. 376-A.
Dr. Silkes testified that there was a myringotomy tube that was placed in the ear by Respondent. The tube is not considered a foreign body, and Medicaid does not pay for its removal when inserted by the original doctor. She concluded that removal of the tubes is not properly billed as CPT Code 69200.
This conclusion is also supported by provisions of the Physicians Services Handbook (Pet. Ex. 13, p. 199), which does not permit additional billing under global surgery packages for the removal of "items such as tubes, drains . . . ." (see bullet point 6 entitled "Miscellaneous Services and Supplies).
This restriction does not place any time limit when the non-reimbursable "miscellaneous service" is performed, even outside the normal 90- or ten-day time period.
The undersigned credits and finds more persuasive the evidence and conclusions from Dr. Silkes and AHCA. The removal of the tubes fell under the exclusion of miscellaneous services or did not otherwise qualify for reimbursement (Pet. Ex. 13,
p. 199). The claim was properly denied.
Recipient #3, Claim 5. Respondent submitted a claim using CPT Code 31237 for services on January 30, 2012, Nasal/Sinus Endoscopy Surgery. Pet. Ex. 15, pp. 376 (worksheet) and 387 (medical record).
Dr. Silkes denied this claim because she could not find documentation to support the procedure. However, there is documentation at Petitioner's Exhibit 15, page 387, included in a contemporaneous office note for January 30, 2012. It indicates on the fifth line that Respondent performed a nasal endoscopy ("nasal endo") and that he did bilateral debridement of the
sinuses. He found crusting on the right, and the right sphenoid sinus was narrow.
Dr. Silkes testified that she may have misread the nasal endo reference and that Dr. Carreno may be correct on that point.
The undersigned credits and finds more persuasive Respondent's evidence and finds that the claim should have been paid as requested and coded.
Recipient #3, Claim 11. Respondent submitted a claim using CPT Code 31231 for services on June 13, 2012, nasal endo. Pet. Ex. 15, pp. 377 (worksheet) and 388 (medical record).
Dr. Silkes denied this claim because she did not find anything in the medical record to support billing for this service.
The supporting medical note documents a nasal endo in the middle of the notes. Respondent wrote in the assessment and plan ("A/P") "looks good but mucocele of right sphenoid." Also, he testified that if he did not do the endoscopy, he could not have seen the right sphenoid.
The undersigned credits and finds more persuasive Respondent's evidence and finds that the claim should have been paid as requested and coded.
Recipient #3, Claim 12. This claim was adjusted from CPT Code 99214 to 99212 by Dr. Silkes. She concluded that the medical records failed to properly document an examination and
the medical decision-making was straightforward. Pet. Ex. 15-3, p. 377.
The undersigned credits and finds more persuasive AHCA's evidence and finds that the code should be reduced to CPT Code 99212.
Recipient #3, Claim 13. This claim was denied by AHCA on the basis that the examination of July 30, 2012, was included within a global surgical fee package. The surgery was performed on August 13, 2012, after the decision to perform the surgery was made on July 16, 2012. Pet. Ex. 15-3, pp. 378 and 389.
The Physicians Services Coverage and Limitations Handbook (Pet. Ex. 11, p. 199) provides as follows:
Evaluation and management services, subsequent to a decision for surgery visit, that are limited and focused to determine the health of the individual prior to surgery are included in the global surgery package and may not be billed separately.
The primary purpose of the visit on July 30, 2012, was an examination to determine the health of the individual. The patient visit was limited in scope and should be included in the global surgical package. The surgical decision was made prior to this encounter, and the surgery occurred after it.
The undersigned credits and finds more persuasive ACHA's evidence and finds that the claim was properly denied.
Recipient #3, Claim 17. Respondent submitted a claim for services performed on January 14, 2013, office outpatient visit. Pet. Ex. 15, pp. 378 (worksheet) and 392 (medical record).
Dr. Silkes down-coded this from CPT Code 99214 to 99212, because "only nasal examination was performed with cultures and he [the patient] was told to return for a full examination." She said the history was problem focused, the exam was problem focused, and the decision-making was straight forward.
Both Dr. Carreno and his coding witness, Lorraine Molinari, pointed out that the record says that the visit lasted "30 minutes." This factor justifies a claim under CPT
Code 99214. Also, the visit involved a more detailed and extensive examination of the nasal areas by Respondent.
The undersigned credits and finds more persuasive the evidence presented by Respondent, particularly due to the amount of time devoted to this visit. It was properly coded as CPT Code 99214.
Recipient #3, Claim 18. Respondent submitted a claim using CPT Code 99214 for an office outpatient visit on
February 13, 2013. Pet. Ex. 15, pp. 378 (worksheet) and 392 (medical record).
Dr. Silkes down-coded this to CPT Code 99213, opining that Dr. Carreno only performed an expanded problem focused history, expanded problem focused examination, and the decision- making was of low complexity.
Dr. Carreno characterized this patient as one of the most complicated medical cases he has handled. The patient had a myriad of medical problems related to his ENT systems.
Dr. Carreno and Molinari stated that the visit included an extensive conversation with the patient and his mother, and he also had to review and consider information from Dr. Ramos (immunologist's) notes.
Dr. Carreno documented a left maxillary sinus suctioned under endoscopy. The extent of his note and documentation is reflective of a more extensive and complex examination and visit. Molinari opined that it should be CPT Code 99214.
The undersigned credits and finds more persuasive the evidence presented by Respondent, particularly due to the complexity of the examination. It was properly coded as CPT Code 99214.
Recipient #3, Claim 20. This claim was adjusted from CPT Code 99214 to 99213 by Dr. Silkes. She opined that the examination was only problem focused ("nasal exam only") and that there were no other records that would support the higher level of services claimed. Pet. Ex. 15-3, pp. 379 and 393.
Additionally, there was no documentation to support a higher level claim under CPT Code 99214, nor was the use of an endoscope documented.
The undersigned credits and finds more persuasive the evidence and conclusions from Dr. Silkes and ACHA. The claim was properly reduced to CPT Code 99213.
Recipient #3, Claim 21. Respondent submitted this claim using CPT Code 31231, a nasal endo code. Pet. Ex. 15-3, pp. 379 and 393.
Dr. Silkes testified she did not find any documentation in the record that would show that an endoscopy was performed
on that date, but did allow an office visit for the same date where a nasal exam was performed (Claim 20, adjusted from CPT Code 99214 to 99213).
The undersigned credits and finds more persuasive the evidence and conclusions from Dr. Silkes and AHCA. The claim was properly reduced to CPT Code 99213 primarily for failure to properly document that an endoscopy was performed.
Recipient #3, Claim 22. Respondent submitted a claim using CPT Code 99214 for services on June 17, 2013, office outpatient visit. Pet. Ex. 15, pp. 379 (worksheet) and 393 (medical record).
Dr. Silkes testified that she reduced this to CPT Code 99213 because only a nasal examination was done which is a
problem focused examination. She concluded that the ear, nose, and throat were not examined.
Dr. Carreno testified that it was not only a nasal exam. His contemporaneous notes reference an "endoscopic debridement" on the third line, which means he used an endoscope to see in the nose and clean fungal content out with suction and graspers.
Molinari opined that the visit should remain CPT Code 99214 because the medical decision-making reflected in the note was at least moderate complexity.
The undersigned credits and finds more persuasive the evidence presented by Respondent. The use of an endoscope and performing the debridement procedure were sufficiently documented. The services performed supported coding as CPT Code 99214.
Recipient #3, Claim 24. This claim by Respondent was adjusted from CPT Code 99214 to 99213 by Dr. Silkes. She opined that "only a nasal examination was done" and that the examination and history were both either problem focused or expanded problem focused. Pet. Ex. 15-3, pp. 379 and 394.
Respondent's witness, Molinari, agreed with Dr. Silkes' adjustment.
The undersigned credits and finds more persuasive the evidence and conclusions from Dr. Silkes and AHCA. The claim was
properly reduced to CPT Code 99213 primarily because the visit only involved a less complicated nasal examination.
Recipient #3, Claim 26. Respondent submitted a claim using CPT Code 99214 for services on January 8, 2014, office outpatient visit. Pet. Ex. 15, pp. 380 (worksheet) and 395 (medical record). Dr. Silkes down-coded it to CPT Code 99213 because "only the nose was examined."
However, Dr. Carreno testified that he performed a fiberoptic laryngoscopy, using an endoscope, to inspect for any fungal debris. This was sufficiently documented in his contemporaneous office notes. He also used the scope to view the nasopharynx. His notes also reflect that a physical exam (PE) was performed.
Molinari felt the claim should remain CPT Code 99214 because the medical decision-making was of moderate complexity.
The undersigned credits and finds more persuasive the evidence presented by Respondent. The use of a scope to inspect the nasal passages and nasopharynx were sufficiently documented. The services performed supported his coding as CPT Code 99214.
Recipient #3, Claim 28. The claim submitted was adjusted from CPT Code 99214 to 99213 by Dr. Silkes. She opined that "only the nose was examined" and that there were no other records that would support the higher level. Pet. Ex. 15-3,
pp. 380 and 395. Further, there was no documentation that an endoscope was used.
The undersigned credits and finds more persuasive the evidence from Dr. Silkes and AHCA. The claim was properly reduced to CPT Code 99213, primarily because the visit involved a less complicated nasal examination.
Recipient #3, Claim 35. Respondent submitted a claim under CPT Code 31237 for services on April 30, 2014, Nasal/Sinus Endoscopy Surgery. Pet. Ex. 15, pp. 381 (worksheet) and 395 (medical record).
Dr. Silkes denied this claim because she felt that this was included in the global surgery package for the septoplasty that was performed on April 21, 2014. A "septoplasty" is where you move the septum in the nose if it is causing problems with sinuses or breathing. In her view, Claim 35 was a normal post- operative visit, namely, to remove the splint.
Dr. Carreno testified and conceded that "yes, I did remove the splints, but I also needed to place the endoscope to assess the sinus surgical site. And not only did I assess it, but I cleaned it and debrided it, and it clearly said cleaned, debrided, endo shows."
Dr. Carreno acknowledged that a septoplasty procedure has a 90-day global period, but testified that a global surgery
package does not apply to a sinus endoscopy and debridement following the sinus surgery.
The undersigned credits and finds more persuasive the evidence presented by Respondent. It was medically prudent and necessary to use an endoscope post-operatively for inspection and debridement, and this was sufficiently documented. The services performed supported coding as CPT Code 31237.
Recipient #25, Claim 11. Respondent submitted this claim using CPT Code 69200. Pet. Ex. 15-25, p. 782.
Dr. Silkes testified that there was a myringotomy tube that was placed in the ear by Respondent. The tube is not considered a "foreign body," and Medicaid does not pay for its removal when inserted by the original doctor. She concluded that removal of the tubes is not properly billed as CPT Code 69200.
This conclusion is supported by provisions of the Physicians Services Handbook (Pet. Ex. 13, p. 199), which does not permit additional billing under global surgery packages for the removal of "items such as tubes, drains . . . ." This is found under bullet point 6 entitled "Miscellaneous Services and Supplies."
This restriction does not place any time limit on when the non-reimbursable "miscellaneous service" is performed, even outside the normal 90-day time period.
The undersigned credits and finds more persuasive the evidence and conclusions from Dr. Silkes and AHCA. The removal of the tubes fell under the exclusion for miscellaneous services or did not otherwise qualify for reimbursement. Pet. Ex. 13,
p. 199. The claim was properly denied.
Recipient #29, Claim 6. Respondent submitted this claim using CPT Code 69200. Pet. Ex. 15-29, p. 830.
Dr. Silkes testified that there was a myringotomy tube that was placed in the ear by Respondent. The tube is not considered a "foreign body," and Medicaid does not pay for its removal when inserted by the original doctor. She concluded that removal of the tubes is not properly billed as CPT Code 69200.
This conclusion is supported by provisions of the Physicians Services Handbook (Pet. Ex. 13, p. 199), which does not permit additional billing under global surgery packages for the removal of "items such as tubes, drains. . . ." (see bullet
point 6 entitled "Miscellaneous Services and Supplies").
This restriction does not place any time limit on when the non-reimbursable "miscellaneous service" is performed, even outside the normal 90-day time period.
The undersigned credits and finds more persuasive the evidence and conclusions from Dr. Silkes and AHCA. The removal of the tubes fell under the exclusion for miscellaneous services
or did not otherwise qualify for reimbursement. Pet. Ex. 13,
p. 199. The claim was properly denied.
Recipient #30, Claim 1. This claim was adjusted down from CPT Code 99214 to 99213 by Dr. Silkes. She opined that both the history and examination were problem focused and that the decision-making was straightforward. Pet. Ex. 15-30, pp. 856 and 861.
The undersigned credits and finds more persuasive the evidence and conclusions from Dr. Silkes and AHCA. The claim was properly adjusted to CPT Code 99213.
Recipient #30, Claim 2. This was submitted under CPT Code 69210. Dr. Silkes denied the claim citing a lack of documentation to show that any cerumen or ear wax was actually removed.
The undersigned credits and finds more persuasive the evidence and conclusions from Dr. Silkes and AHCA. The removal of cerumen was not properly documented, and the claim should be denied.
Recipient #30, Claim 4. Respondent submitted a claim for services using CPT Code 99214 for services on May 16, 2012, Office/Outpatient Visit. Pet. Ex. 19 (no Bates stamp numbers, as this was a late submission). After reviewing several late-filed documents from Respondent, Dr. Silkes down-coded this to CPT
Code 99213 because there was an expanded problem focused history,
there was a problem focused examination, and medical decision- making was of low complexity.
Dr. Carreno explained that the claim should be allowed as CPT Code 99214 because he examined four separate body systems or areas. He examined the throat due to enlarged tonsils and enlarged adenoids, he examined the ear for infection, he took the patient's temperature and weight in connection with sleep apnea, and he examined the nose. He also rescheduled the patient for surgery and discussed the risks and benefits of surgery with the parents.
Molinari testified that it should be allowed as a CPT Code 99214 because the decision-making was, at least, of moderate complexity, including a detailed examination of pallet, tonsils, and sinuses, as well as explaining the risk and benefits of surgery to the parents.
The undersigned credits and finds more persuasive the evidence presented by Respondent. This visit involved a more detailed and extensive examination of the patient and justified a claim using CPT Code 99214.
CONCLUSIONS OF LAW
In Florida, administrative hearings held pursuant to chapter 120, Florida Statutes (2016), are "de novo" in nature.
§ 120.571(1)(k), Fla. Stat. In simple terms, the decision of the agency being challenged is reviewed again by the administrative
law judge, and there is no "presumption of correctness" that attaches to the preliminary decision of the Agency. See generally Fla. Dep't of Transp. v. J.W.C. Co., 396 So. 2d 778
(Fla. 1st DCA 1981); and Boca Raton Artificial Kidney Ctr., Inc. v. Fla. Dep't of HRS, 475 So. 2d 260 (Fla. 1st DCA 1985).
A chapter 120 hearing also permits the affected parties an opportunity to change the agency's mind. Lawnwood
Med. Ctr. v. Agy. for Health Care Admin., 678 So. 2d 421 (Fla.
1st DCA 1996); Couch Const. Co. v. Dep't of Transp., 361 So. 2d
172 (Fla. 1st DCA 1978); and Beverly Enters. v. Dep't of HRS, 573
So. 2d 19, 23 (Fla. 1st DCA 1990)("[R]equest for a formal administrative hearing commences a de novo proceeding intended to formulate agency action.").
In short, it is the facts and observations found at the final hearing by the administrative law judge which carry the day, and upon which any preliminary action by the agency is measured.
Likewise, in a chapter 120 proceeding, an administrative law judge is afforded broad discretion in determining the facts, so long as his or her findings are supported by competent and substantial evidence. Goin v. Comm'n
on Ethics, 658 So. 2d 1131 (Fla. 1st DCA 1995)("Florida's Administrative Procedures Act relies upon a hearing officer to consider all the evidence presented, resolve conflicts, judge
credibility of witnesses, draw permissible inferences from the evidence, and reach ultimate findings of fact based on competent, substantial evidence.").
Notably, the determination of whether certain facts constitute a statutory violation are ultimate factual findings within a hearing officer's discretion. J.J. Taylor Cos. v. Dep't of Bus. & Prof'l Reg., Div. of Alcoholic Beverages & Tobacco, 724
So. 2d 192 (Fla. 1st DCA 1999). See also Heifetz v. Dep't of
Bus. Reg., Div. of Alcoholic Beverages & Tobacco, 475 So. 2d 1277 (Fla 1st DCA 1985).
Turning to laws more distinctive to this case, AHCA has the burden of establishing an alleged Medicaid overpayment by a preponderance of the evidence. Southpointe Pharmacy v. Dep't of HRS, 596 So. 2d 106, 109 (Fla. 1st DCA 1992).
Although AHCA bears the ultimate burden of persuasion, section 409.913(22) provides that "[t]he audit report, supported by agency papers, showing an overpayment to the Respondent constitutes evidence of the overpayment." Thus, AHCA made out a prima facie case by proffering its properly-supported FAR or audit report, which was received into evidence in this case, without objection.
AHCA is also authorized to "require repayment for inappropriate, medically unnecessary, or excessive goods or services from the person furnishing them, the person under whose
supervision they were furnished, or the person causing them to be furnished." § 409.913(11), Fla. Stat.
To be eligible for coverage by Medicaid, a service must be "medically necessary," which is defined in section 409.913(1)(d) as follows:
(d) "Medical necessity" or "medically necessary" means any goods or services necessary to palliate the effects of a terminal condition, or to prevent, diagnose, correct, cure, alleviate, or preclude deterioration of a condition that threatens life, causes pain or suffering, or results in illness or infirmity, which goods or services are provided in accordance with generally accepted standards of medical practice.
For the purposes of determining Medicaid reimbursement, AHCA is the final arbiter of medical necessity. Id.
The statute also requires that determinations of medical necessity be made by a licensed physician employed by or under contract with AHCA, also known as a peer reviewer, based on information available at the time the goods and services are provided. Id.
The parties stipulated, and the undersigned concludes, that Dr. Silkes was qualified and properly credentialed as a licensed physician in Florida to perform the peer review in this case.
The following "Disputed Claims" are resolved in favor of AHCA: Recipient #2, Claims 1 and 2 (by oral stipulation); Recipient #2, Claim 3; Recipient #3, Claims 12, 13, 20, 21, 24, and 28; Recipient #25, Claim 11; Recipient #29, Claim 6; and Recipient #30, Claims 1 and 2. AHCA is entitled to use these findings to recalculate reimbursement from Respondent for these particular claims.
AHCA has not proven by a preponderance of the evidence that Respondent improperly billed for the following "Disputed Claims": Recipient #3, Claims 5, 11, 17, 18, 22, 26, and 35; and Recipient #30, Claim 4. These claims are resolved in favor of Respondent, and AHCA is not entitled to reimbursement from Respondent for these claims, or to utilize them in its reimbursement calculations.
It was Respondent's responsibility to properly code the individual services billed to Medicaid; to properly document the services and the medical necessity for the services in the medical records; and to present claims that are true and accurate.
Rule 59G-9.070(7)(e) addresses the failure to comply with the provisions of the Medicaid laws and authorizes AHCA to impose an administrative fine. It states in pertinent part:
(7) Sanctions: In addition to the recoupment of the overpayment, if any, the Agency will impose sanctions as outlined in
this subsection. Except when the Secretary of the Agency determines not to impose a sanction, pursuant to Section 409.913(16)(j), F.S., sanctions shall be imposed as follows[.] (emphasis added).
The rule provides that for a first offense, there is a
$1,000.00 fine per claim found to be in violation. Accordingly, AHCA's fine should be adjusted using only the listed violations found herein. The undersigned finds no factual basis for an enhancement of the fine amount.3/
The authority under rule 59G-9.070 to impose sanctions on respondents who violate Medicaid-related laws is clear, and the meaning of the phrases "will impose" and "shall be imposed" are unambiguous and directory in nature. Carmack v. State, 31
So. 3d 798, 800 (Fla. 1st DCA 2009)(holding that the terms of a law or regulation should be given their plain meaning).
To impose an administrative fine, which is punitive in nature, AHCA must establish the factual grounds for doing so by clear and convincing evidence. Dep't of Child. & Fams. v. Davis
Fam. Day Care Home, 160 So. 3d 854, 857 (Fla. 2015). The Agency presented clear and convincing evidence that Respondent failed to comply with state and federal law, rules, regulations, and policies of the Medicaid program for the listed violations found herein. The evidence revealed that in those instances, Respondent billed at higher levels of service without supporting documentation; filed claims for some services that were
specifically precluded by Medicaid rules and policies; and for some services that were determined by credible evidence to not be medically necessary as defined by Florida law, rules, and Medicaid handbooks.
The Agency is seeking costs expended by it in the investigation of Respondent and the litigation of the audit findings, including the services rendered by the investigators involved in the audit, as well as the expert consulted to assist the Agency. § 409.913(23), Fla. Stat. The amount expended pre- hearing was $2,921.23 (Pet. Ex. 6, p. 150-B). Additional costs have been incurred in preparing for and attending the final hearing.
Upon proper application and proof, the Agency will be awarded appropriate and reasonable costs.4/
Based on the evidence covering the Disputed Claims during the audit period of January 1, 2012, through December 31, 2014, it has been established by a preponderance of the evidence that Respondent was overpaid for certain services not covered by Medicaid. Those overpayments are listed in paragraph 123 in the Conclusions of Law section. The undersigned recommends that the Agency for Health Care Administration enter a final order ordering Respondent to repay the recalculated amount.
Considering the facts proven at the hearing, the Agency has established by clear and convincing evidence that Respondent failed to comply with the provisions of the Medicaid law for certain claims. Those overpayments are also listed in paragraph 123 in the Conclusions of Law section. It is recommended that the Agency recalculate and impose a sanction commensurately lower than the previous sanction, pursuant to rule 59G-9.070(7)(e).
Pursuant to section 409.913(23)(a), the Agency's request of an award of reasonable investigative, legal, and expert witness costs as the prevailing party is granted, in part, based on a limited number of violations outlined in paragraph 123. If the amount of the costs cannot be agreed to, then the Agency may request a hearing for the establishment of the costs.
DONE AND ENTERED this 22nd day of May, 2017, in Tallahassee, Leon County, Florida.
ROBERT L. KILBRIDE
Filed with the Clerk of the Division of Administrative Hearings this 22nd day of May, 2017.
1/ The hearing, and evidence presented at the hearing, was limited to the parties challenging or supporting only these "Disputed Claims."
2/ This "documentation" requirement forms the crux of many of AHCA's disputes with claims filed by Respondent.
3/ The "Disputed Claims" involved close or difficult calls involving matters of professional medical discretion and
decision-making. As Olmstead testified, the issues and claims in this case were "typical." As a result, no fine enhancer would be appropriate.
4/ The parties should discuss the findings and conclusions of law in this Recommended Order, and are strongly encouraged to settle the cost issue to avoid further time and expense. If this cannot be done, a separate evidentiary hearing will be convened by the undersigned to consider the matter upon motion by either party.
Joseph G. Hern, Esquire James B. Countess, Esquire
Martin R. Dix, Esquire Akerman LLP
Richard J. Shoop, Agency Clerk
Stuart Williams, General Counsel Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3
Shena L. Grantham, Esquire
Thomas M. Hoeler, Esquire
Kim A. Kellum, Esquire
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.
