STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

ARTHUR HENSON, D.O., )

)

Petitioner, )

)

vs. ) Case No. 02-4174MPI

)

AGENCY FOR HEALTH CARE )

ADMINISTRATION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a final hearing was held in this case by video teleconference on June 6, 2005, with connecting sites in Miami and Tallahassee, Florida, before Errol H. Powell, a designated Administrative Law Judge of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Kevin J. Kulik, Esquire

Kevin J. Kulik, P.A.

600 South Andrews Avenue, Suite 500 Fort Lauderdale, Florida 33301

For Respondent: Anthony L. Conticello, Esquire

Agency for Health Care Administration 2727 Mahan Drive, Mail Station 3

Tallahassee, Florida 32308

STATEMENT OF THE ISSUE

The issue for determination is whether Petitioner was overpaid by the Medicaid program as indicated in Respondent's Final Agency Audit Report dated June 20, 2001.

PRELIMINARY STATEMENT

By Final Agency Audit Report (FAAR) dated June 20, 2001, Arthur Henson, D.O., was notified by the Agency for Health Care Administration (AHCA) that a review of his Medicaid claims for the period January 1, 1998 through September 30, 2000, indicated that he had been overpaid by the Medicaid program in the amount of $124,556.83. The procedure and formula for the calculation of the overpayment was included in the FAAR. Dr. Henson, through counsel, disputed the FAAR and requested a hearing. On October 25, 2002, this matter was referred to the Division of Administrative Hearings.

The hearing in this matter was scheduled for a four-day hearing commencing January 28 through 31, 2003. Discovery proceeded and, subsequently, Dr. Henson requested the notification of absent parties (the medical center with which he was employed and the officer and shareholder of the medical center) to allow them an opportunity to become parties in this proceeding; the request was granted. As a result, the hearing was continued and, after consultation with the parties, the hearing was rescheduled for June 3 through 6, 2003. On March 6,

2003, Dr. Henson's counsel filed an Emergency Motion to Withdraw and Motion for Continuance. The Emergency Motion to Withdraw was granted, and Dr. Henson was provided an opportunity to obtain new counsel; but the Emergency Motion for Continuance was denied as the undersigned was not persuaded that new counsel could not prepare for the hearing given the length of time before the hearing was to commence. Dr. Henson kept the undersigned advised as to his progress on obtaining new counsel. On May 6, 2003, AHCA requested and was granted a continuance of the hearing, and the hearing was re-scheduled for July 28 through 31, 2003. On July 8, 2003, a Notice of Appearance was filed by Dr. Henson's new counsel. Subsequently, the Notice of Hearing was amended twice: firstly, reflecting an amended hearing date of September 24 through 26, 2003; and secondly, reflecting an amended hearing date of October 28 through 30, 2003. Afterwards on October 22, 2003, counsel for Dr. Henson requested a continuance based primarily upon various pending discovery matters, exhibits, a crucial witness, and prior counsel matters, which was granted.

By Order to Show Cause dated December 17, 2003, the parties were directed to show cause why the file in the instant matter should not be closed. The parties successfully demonstrated that the file should not be closed. The hearing was re- scheduled for April 21 through 23, 2004. On April 8, 2004,

Dr. Henson's counsel of record filed for leave to withdraw and for a continuance of the hearing. Dr. Henson's counsel was permitted to withdraw, Dr. Henson was allowed an opportunity to obtain counsel again, and a continuance was granted. Dr. Henson kept the undersigned advised as to his ability to obtain counsel.

On July 14, 2004, a Notice of Appearance was filed by counsel for Dr. Henson. After consultation with the parties, the hearing was re-scheduled for February 23 through 25, 2005. Discovery continued. Subsequently, Dr. Henson's counsel requested a continuance, which was granted, and the hearing was re-scheduled for April 26, 28, and 29, 2005. Afterwards,

Dr. Henson's counsel requested the hearing to be held by video teleconference due to Dr. Henson's financial constraints. Video teleconferencing was unavailable for the scheduled hearing dates. On April 19, 2005, the parties filed a Joint Motion to Reset Final Hearing, so that the hearing could be held by video teleconference. The joint motion was granted and the hearing was re-scheduled by video teleconference on June 6 and 7, 2005. AHCA filed a unilateral pre-hearing statement.

At hearing, the parties agreed that AHCA had the burden of proof. AHCA presented the testimony of one witness and entered

30 exhibits (Respondent's Exhibits numbered 1-29 and 31) into evidence, with two exhibits (Respondent's Exhibits 4 and 29)

being video depositions. Dr. Henson testified in his own behalf and entered no exhibits into evidence. A transcript of the hearing was ordered. At the request of the parties, the time for filing post-hearing submissions was set for more than ten days following the filing of the transcript. After a considerable amount of time had elapsed from the date of the hearing, the undersigned requested a status on the transcript from the parties. AHCA responded and obtained the transcript of the hearing. The Transcript, consisting of one volume, was filed on December 30, 2005. An extension of time was requested for the filing of post-hearing submissions, which was granted.

AHCA filed its post-hearing submission on February 17, 2006, and Dr. Henson filed his post-hearing submission on February 27, 2006. The parties’ post-hearing submissions were considered in the preparation of this Recommended Order.

FINDINGS OF FACT

1. Dr. Henson was an authorized Medicaid provider during the audit period of January 1, 1998 through September 30, 2000.1

2. During the audit period, Dr. Henson had been issued Medicaid provider number 0467243-00.2

3. No dispute exists that, during the audit period,

   
   

   Dr. Henson had a valid Medicaid Provider Agreement(s) with AHCA.3

4. During the audit period, Dr. Henson was employed by Latin Quarter Medical Center, located at 855 Southwest 8th Street, Miami, Florida, at which he treated Medicaid recipients.

5. Dr. Henson had been a surgeon but had suffered a stroke in December 1997, which caused him to be incapable of continuing to practice as a surgeon. He agreed to become employed with Latin Quarter Medical Center to work at its new clinic and to receive compensation for his services every two weeks. Latin Quarter Medical Center's patients were suffering from AIDS.

6. Dr. Henson agreed to several terms and conditions in executing a Medicaid Provider Agreement (Agreement) with AHCA. Those terms and conditions included the following:

   1. Quality of Service. The provider agrees to provide medically necessary services or goods . . . agrees that services and goods billed to the Medicaid program must be medically necessary . . . The services and goods must have been actually provided to eligible Medicaid recipients by the provider prior to submitting the claim.

      
      

   2. Compliance. The provider agrees to comply with all local, state and federal laws, rules, regulation, licensure laws, Medicaid bulletins, manuals, handbooks and Statements of Policy as they may be amended from time to time.

      
      

   3. Term and signatures This

      provider agreement . . . shall remain in effect until July 1, 1999, unless otherwise terminated. . . .

      
      

   4. Provider Responsibilities. The Medical provider shall:

      
      

      * * *

      
      

      (b) Keep and maintain . . . all medical and Medicaid related records as the Agency may require and as it determines necessary; make available for state and federal audits for five years, complete and accurate

      medical . . . records that fully justify and disclose the extent of the goods and services rendered and billings made under the Medicaid. . . .

      
      

      The Agreement was signed by Dr. Henson in 1996.

      
      

7. In a Noninstitutional Professional and Technical Medicaid Provider Agreement, Dr. Henson agreed to terms and conditions including the following:

   1. The provider agrees to keep complete and accurate medical . . . records that fully justify and disclose the extent of the services rendered and billings made under the Medicaid program . . . .

      
      

   2. The provider agrees that services or goods billed to the Medicaid program must be medically necessary . . . and the services and goods must have been actually provided to eligible Medicaid recipients by the provider prior to submitting a claim. The provider agrees to submit Medicaid claims in accordance with program policies and that payment by the program for services rendered will be based on the payment methodology in the applicable Florida Administrative

   Rule. . . .

   
   

   * * *

   
   

   8. The provider and the Department [Department of Health and Rehabilitative Services] agree to abide by the provisions of the Florida Administrative Code, Florida Statutes, policies, procedures, manuals of

   the Florida Medicaid Program and Federal laws and regulations.

   
   

   The Agreement was signed by Dr. Henson in 1988.

   
   

8. AHCA audited certain of Dr. Henson's Medicaid claims pertaining to services rendered between January 1, 1998 and September 30, 2000.

9. By Preliminary Agency Audit Report (PAAR) dated

   
   

   April 12, 2001, AHCA notified Dr. Henson that, after a physician consultant with a specialty in infectious disease reviewed the Medical claims and medical records provided by Dr. Henson, a preliminary determination was made that certain claims in the amount of $124,556.83 were not covered by Medicaid.

10. After the issuance of the PAAR, no further documentation was submitted by Dr. Henson to AHCA. As a result, AHCA issued a FAAR dated June 20, 2001, upholding the overpayment of $124,556.83. The FAAR indicated, among other things, that the documentation provided by Dr. Henson supported a lower level of office visit than the one billed and for which payment was received and, therefore, the difference between the payment for the appropriate level of service and the amount actually paid was an overpayment; that some of Dr. Henson's medical records failed to contain documentation for services which were billed and for which payment was made and, therefore, the payments for the inappropriate documentation was an

    overpayment; that some of the services rendered were inappropriately coded and the difference between payment for the proper code and the inappropriate code was an overpayment; and that some of the services for which billing was made and payment received were not medically necessary and those services were disallowed and were, therefore, an overpayment.

11. The FAAR further provided how the overpayment was calculated, indicating, among other things, that a sample of 30 recipients of the 2936 claims submitted by Dr. Henson were reviewed for the period from January 1, 1998 through

    September 30, 2000; that a statistical formula for cluster sampling, with the formula being presented, was used; that the statistical formula was generally accepted; and that the statistical formula showed an overpayment in the amount of

    $124,556.83, with a 95 percent probability of correctness.

    
    

12. The majority of the overpayment was due to denied claims for intravenous infusions of multi-vitamins, epogen and nupogen to adult HIV/AIDS patients.

13. AHCA's representative primarily responsible for handling the audit of Dr. Henson was Sharon Dewey, a registered nurse employed in the Medicaid Program Integrity (MPI) division of AHCA. Nurse Dewey conducted an audit of Medicaid payments only under Dr. Henson's Medicaid Provider number.

14. An on-site visit of Dr. Henson's office was made by Nurse Dewey. During the on-site visit, she provided Dr. Henson with a questionnaire, which was completed by her and signed by Dr. Henson, and which indicated that Dr. Henson was the only Medicaid Provider at the office at which he was located, Latin Quarter Medical Center, 855 Southwest 8th Street, Miami, Florida.

15. At the on-site visit, Dr. Henson provided all of the medical documentation and medical recipient records for the audit period involved. All the Medicaid claims for the medical recipients were paid Medicaid claims originating only from

    Dr. Henson's Medical Provider number.

    
    

16. Dr. Henson made available and provided to AHCA or AHCA's representatives any and all required Medicaid-related records and information pertaining to the audit that he had in his possession.4 He never refused to allow access to the records or information.

17. Having received the medical recipient records from Dr. Henson, Nurse Dewey organized the records by patient names and dates of service and provided them to Dr. Joseph W. Shands, Jr., along with a worksheet for the audited claims for each patient.

18. Dr. Shands is an expert in infectious diseases and the treatment and management of AIDS and HIV. Dr. Shands retired in

    2002, and his practice was basically the same as Dr. Henson. No objection was made at hearing that Dr. Shands met the statutory definition of "peer." § 409.9131(1)(c), Florida Statutes (1999).5 The undersigned finds Dr. Shands' testimony persuasive.

19. Dr. Shands reviewed the medical documentation provided by Dr. Henson to AHCA. The medical documentation that he reviewed indicated that the patients were "all HIV AIDS patients." Dr. Shands reviewed the particular medications given the patients; reviewed the reasons why the medications were given; considered and made a determination as to whether a justification existed for the administration of the medication; and, based on his determination, either allowed or disallowed the claim. He made no determinations as to the actual dollar amount of services provided.

20. After reviewing the medical records, Dr. Shands made notations on the worksheets, signed the worksheets, and returned the worksheets to Nurse Dewey.

21. Specific instances of acute attention involved the administration of intravenous (IV) multi-vitamins, epogen, nupogen, and Intravenous Immunoglobulin (IVIG).

22. As to the IV of multi-vitamins, Dr. Henson prescribed this administration for almost all of his patients. Dr. Shands found that the patients were coming into the facility two to three times a week for the treatment, but he found no documented

    medical information to justify the use of IV multi-vitamins and determined these services were not medically necessary. In

    Dr. Shands' opinion an oral multi-vitamin would have been more appropriate and achieved the same result. An oral multi-vitamin is not recommended, according to Dr. Shands, where the patient is unable to digest the oral multi-vitamin. Notably, for one patient a notation was made that the patient refused pills, but a further notation indicated that Dr. Henson had prescribed the same patient pill-based medications for treatment, which negated the basis for the intravenous use. Furthermore, IV administration to an HIV/AIDS patient places the patient at an unnecessary risk of infection, which is not present with oral multi-vitamins.

23. Dr. Henson testified that he was continuing the treatment of another physician, but he failed to make an independent medical judgment based upon his own medical findings. Further, no justification was in the medical records for the former physician's administration of IV multi-vitamins.

24. Additionally, IV multi-vitamins were more costly than oral administration. And, with patients returning to the facility two to three times a week, the cost increased even more.

25. Regarding epogen, Dr. Shands opined that certain administration was not medically necessary for the HIV/AIDS' patients.

26. As to nupogen, Dr. Shands opined that certain administration was not medically necessary for the HIV/AIDS' patients.

27. Regarding the administration of IVIG, Dr. Shands opined that the administration was not medically necessary for the HIV/AIDS' patients.

28. As to certain office visits for the administration of IV multi-vitamins, epogen, nupogen, and IVIG, Dr. Shands opined that the office visits were unnecessary.

29. Using the worksheets, with Dr. Shands' notations on them, together with Dr. Shands denials or reductions, Nurse Dewey calculated the overpayment associated with each of

    Dr. Henson's patients.

    
    

30. Subsequently, a statistical calculation was applied by AHCA to extend the audit sample's total overall payment to all of Dr. Henson's Medicaid claims during the audit period, which resulted in a determination of an overpayment in the amount of

    $124,556.83.

    
    

31. Dr. Henson suggests that his signature may have been falsified or forged on the medical records and information that he submitted to AHCA for its audit. Prior to hearing, he had an

    opportunity to review the medical records and information but could not identify one instance that his signature was falsified or forged. Consequently, a finding of fact is made that

    Dr. Henson signed the medical records and documentation provided to AHCA by him for the audit.

32. Dr. Henson presented no expert testimony or any testimony to support the medical necessity or cost-effectiveness of the procedures that he used.

33. Further, Dr. Henson contends that Latin Quarter Medical Center, the facility that employed him, received the Medicaid payments, not he. However, as the Medicaid Provider, he was not relieved of his responsibility to make sure that the medical procedures were medically necessary and cost-effective.

    CONCLUSIONS OF LAW

    
    

34. The Division of Administrative Hearings has jurisdiction over the subject matter of this proceeding and the parties thereto pursuant to Sections 120.569 and 120.57(1), Florida Statutes (2006).

35. The burden of proof is on AHCA to establish a Medicaid overpayment by a preponderance of the evidence. South Medical Services, Inc. v. AHCA, 653 So. 2d 440, 441 (Fla. 3d DCA 1995).

36. Section 409.913, Florida Statutes (2001), provides in pertinent part:

    (21) The audit report, supported by agency work papers, showing an overpayment to a provider constitutes evidence of the overpayment. . . .

    
    

    Pursuant to the said subsection, AHCA can establish a prima facie case of overpayment merely by the admission into evidence of a properly supported audit report. See Maz Pharmaceuticals, Inc. v. Agency for Health Care Administration, DOAH Case No. 97- 3791 (Recommended Order, March 20, 1998).

37. During the audit period, AHCA was charged with overseeing Florida's Medicaid program, including the program's integrity. Section 409.913, Florida Statutes (1998-2000), provided in pertinent part that AHCA "shall operate a program to oversee the activities of Florida Medicaid recipients, and providers and their representatives, to ensure that fraudulent and abusive behavior and neglect of recipients occur to the minimum extent possible, and to recover overpayments and impose sanctions as appropriate."6

38. The Florida Legislature made provisions for AHCA to discover the fraud, abuse, and neglect and to recover overpayments. Section 409.913(2), Florida Statutes (1998-2000), provides in pertinent part that AHCA "shall conduct, or cause to be conducted by contract or otherwise, reviews, investigations, analyses, audits, or any combination thereof, to determine possible fraud, abuse, overpayment, or recipient neglect in the

    Medicaid program and shall report the findings of any overpayments in audit reports as appropriate."7

39. An affirmative duty is placed on Medicaid providers by Section 409.913(7), Florida Statutes (1996-2000), to ensure goods and services, providing in pertinent part:

    (b) Are Medicaid-covered goods or services that are medically necessary.

    
    

    * * *

    
    

    1. Are provided in accord with applicable provisions of all Medicaid rules, regulation, handbooks, and policies and in accordance with federal, state, and local law.

       
       

    2. Are documented by records made at the time the goods or services were provided, demonstrating the medical necessity for the goods or services rendered. Medicaid 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 record.

    
    

40. Medical necessity or medically necessary is defined in Section 409.913(1)(c), Florida Statutes (1996-2000), as "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.”

41. Furthermore, the Chapter 2 of the Physician Services Covered Services, Limitations, and Exclusions Handbook, November 1997, January 1999, and January 2000, at page 2-2, and the Medicaid Provider Reimbursement Handbook, HCFA-1500 and Child Health Check-Up 221 (Medicaid Provider Reimbursement Handbook), July 1999, at page D-10, defines medically necessary services, in part, as those services reflecting the level of service "that can be safely furnished, and for which no equally effective and more conservative or less costly treatment is available statewide "

42. As to maintaining records necessary to demonstrate medically necessary goods or services, Section 409.913(8), Florida Statutes (1996-2000), imposes certain requirements and provides in pertinent part:

    (8) A Medicaid provider shall retain medical, professional, financial, and business records pertaining to services and goods furnished to a Medicaid recipient and billed to Medicaid for a period of 5 years after the date of furnishing such services or goods. . . .

    
    

43. Furthermore, the Medicaid Provider Reimbursement Handbook, July 1999, page 2-19, provides that a provider "must retain," for a period of "at least five years from the date of service," all medical, fiscal, professional, and business records on all services provided to a Medicaid recipient; and at

    page 2-20 that the "medical records must state the necessity for and the extent of services provided."

44. Failure of a Medicaid provider to comply with the aforementioned requirements subjects the Medicaid provider to repayment action by AHCA. Section 409.913(10), Florida Statutes (1996-2000), provides that "The agency may 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."

45. Overpayment is defined by Section 409.913(1)(d), Florida Statutes (1996-2000), as including "any amount that is not authorized to be paid by the Medicaid program whether paid as a result of inaccurate or improper cost reporting, improper claiming, unacceptable practices, fraud, or abuse, or mistake.”

46. The following were admissions made by Dr. Henson in the Request for Admissions:8

    1. The stated purpose behind the five-year document retention requirement of Section 409.907(3)(c), Florida Statutes, is so that Dr. Henson can "satisfy all necessary inquiries by the agency [AHCA]."

    2. Section 409.913(7)(f), Florida Statutes, imposes an affirmative duty on Dr. Henson to make sure that any claim for

       goods and services are "documented by records made at the time good and services were provided."

    3. Section 409.913(7)(f), Florida Statutes, imposes an affirmative duty on Dr. Henson to make sure that any [sic] all the records documenting Medicaid goods and services demonstrate "the medical necessity for the goods and services rendered."

    4. Section 409.913(7)(f), Florida Statutes, declares that Medicaid goods and services are "excessive or medically unnecessary, unless both the medical basis and the specific need for them are fully and properly documented in the recipient's medical record."

    5. Section 409.913(7)(f), Florida Statutes, authorizes AHCA to investigate, review, or analyze the records, including Medicaid-related Records, that Dr. Hinson is required to retain.

    6. Section 409.913(1)(c), Florida Statutes, states in part that, "Determinations of medical necessity . . . must be based upon information available at the time goods or services are provided."

    7. Section 409.913(1)(d), Florida Statutes, defines "overpayment" as, "any amount that is not authorized to be paid by the Medicaid program whether paid as a result of inaccurate or improper cost reporting, improper claiming, unacceptable practices, fraud, abuse, or mistake."

47. AHCA demonstrated a prima facie case of Medicaid overpayment to Dr. Henson in the amount of $124,556.83 for the audit period.

48. Dr. Henson failed to present sufficient evidence to rebute, refute or otherwise undermine the evidence presented by AHCA.

49. AHCA demonstrated that the services provided by

Dr. Henson were not in compliance with Medicaid reimbursement requirements; that it used accepted and valid auditing and analytical methods in determining the Medicaid overpayment; and that Dr. Henson received Medicaid overpayments in the amount of

$124,556.83 for the audit period January 1, 1998 through September 30, 2000.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is

RECOMMENDED that the Agency for Health Care Administration enter a final order finding that Arthur Henson, D.O., received overpayments in the Medicaid program in the amount of

$124,556.83, during the audit period January 1, 1998 through September 30, 2000, and requiring Arthur Henson, D.O., to repay the overpayment amount.

DONE AND ENTERED this 29th day of June, 2006, in Tallahassee, Leon County, Florida.

S

ERROL H. POWELL

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847 www.doah.state.fl.us

Filed with the Clerk of the Division of Administrative Hearings this 29th day of June, 2006.

ENDNOTES

1/ Admitted in Request for Admissions.

2/ Id.

3/ Id.

4/ Id.

5/ Section 409.9131(2)(c), Florida Statutes (1999), defines "peer" as "a Florida licensed physician who is, to the maximum extent possible, of the same specialty or subspecialty, licensed under the same chapter, and in active practice."

6/ This statutory provision was also applicable in 1996 and 1997.

7/ Id.

8/ The statutory provisions indicated were agreed upon as applicable during the audit period 1998 through 2000.

COPIES FURNISHED:

Kevin J. Kulik, Esquire Kevin J. Kulik, P.A.

600 South Andrews Avenue, Suite 500 Fort Lauderdale, Florida 33301

Anthony L. Conticello, Esquire

Agency for Health Care Administration 2727 Mahan Drive, Mail Station 3

Tallahassee, Florida 32308

Alan Levine, Secretary

Agency for Health Care Administration Fort Knox Building, Suite 3116

2727 Mahan Drive

Tallahassee, Florida 32308

Christa Calamas, General Counsel Agency for Health Care Administration Fort Knox Building, Suite 3431

2727 Mahan Drive, Mail Station 3

Tallahassee, Florida 32308

Richard Shoop, Agency Clerk

Agency for Health Care Administration Fort Knox Building, Suite 3431

2727 Mahan Drive, Mail Station 3

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.

Docket for Case No: 02-004174MPI

Orders for Case No: 02-004174MPI