STATE OF FLORIDA

AGENCY FOR HEALTH CARE ADMINISTRATION

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AGE HCY CLERK

STATE OF FLORIDA, AGENCY FOR

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HEALTH CARE ADMINISTRATION,

Petitioner,

V.

VITAS HEALTHCARE CORPORATION OF FLORIDA,

Respondent.

                                                                      I

DOAH CASE NOS. 17-0792MPI

17-0793MPI

17-0794MPI MPI CASE IDs. 2015-0002756

2015-0002757

2015-0002758

RENDITI0 J NO.: AHCA-1 \'.>- oc>'S1 -FOF-MDO

AMENDED FINAL ORDER1

This case was referred to the Division of Administrative Hearings (DOAH) where the assigned Administrative Law Judge (ALJ), Mary Li Creasy, issued a Recommended Order after conducting a formal hearing. At issue in this proceeding is whether the Agency for Health Care Administration ("Agency") is entitled to recover alleged Medicaid overpayments it made to Respondent for hospice services Respondent provided through three program locations (Melbourne, Boynton Beach, and Dade) during the audit period between September 1, 2009, and December 31, 2012, and whether the Agency should impose costs and a fine on Respondent. The Recommended Order dated September 28, 2018, is attached to this Amended Final Order

and incorporated herein by reference, except where noted infra.

RULING ON EXCEPTIONS

Petitioner filed exceptions to the Recommended Order, and Respondent filed a response to Petitioner's exceptions.

1 The Amended Final Order comes as a result of the issues Petitioner raised in its Motion for Rehearing filed on December 3, 2018. By entering this Amended Final Order, the Agency hereby grants the Motion for Rehearing over the objection Respondent made in its Response in Partial Opposition to AHCA's Motion for Rehearing pertaining to the Agency's ruling on Petitioner's First Exception. However, the Agency notes that Petitioner incorrectly argued in its Motion for Rehearing that the final order used an improper standard in ruling on Petitioner's First Exception. That is incorrect. The standard used by the Agency in ruling on Petitioner's First Exception in the original final order is the one mandated by section 120.57(1)(/), Florida Statutes.

Filed December 28, 2018 10:44 AM Division of Administrative Hearings

In determining how to rule upon Petitioner's exceptions and whether to' adopt the ALJ's Recommended Order in whole or in part, the Agency must follow section 120.57(1)(1), Florida Statutes, which provides in pertinent part:

The agency may adopt the recommended order as the final order of the agency. The agency in its final order may reject -or modify the conclusions of law over which it has substantive jurisdiction and interpretation of administrative rules over which it has substantive jurisdiction. When rejecting or modifying such conclusion of law or interpretation of administrative rule, the agency must state with particularity its reasons for rejecting or modifying such conclusion of law or interpretation of administrative rule and must make a finding that its substituted conclusion of law or interpretation of administrative rule is as or more reasonable than that which was rejected or modified. Rejection or modification of conclusions of law may not form the basis for rejection or modification of findings of fact. The agency may not reject or modify the findings of fact unless the agency first determines from a review of the entire record, and states with particularity in the order, that the findings of fact were not based upon competent substantial evidence or that the proceedings on which the findings were based did not comply with essential requirements oflaw....

§120.57(1)(1), Fla. Stat. Additionally, "[t]he final order shall include an explicit ruling on each exception, but an agency need not rule on an exception that does not clearly identify the disputed portion of the recommended order by page number or paragraph, that does not identify the legal basis for the exception, or that does not include appropriate and specific citations to the record."

§ 120.57(1)(k), Fla. Stat. In accordance with these legal standards, the Agency makes the following rulings on Petitioner's exceptions:

In its First Exception, Petitioner takes exception to Paragraphs 53 and 54 of the Recommended Order. Petitioner argues the ALJ's interpretation of the Florida Medicaid Hospice Services and Coverage and Limitations Handbook, January 2007 edition ("Handbook"), contained within those paragraphs are conclusions of law that contradict the Agency's interpretation of the handbook, and must therefore be rejected. The ALJ points out in Paragraph

53 of the Recommended Order that the Handbook states that "[d]ocumentation to support the terminal prognosis must accompany the initial certification of terminal illness. This

documentation must be on file in the recipient's hospice record." See Page 2-4 of the Handbook (Emphasis added). According to Page 2-4 of the Handbook, the documentation for the initial certification must include six things that are bullet-pointed within that section. The ALJ then

notes that, on the following page, the Handbook states, "[f]or the subsequent election periods, written certification from the hospice medical director or physician member of the

interdisciplinary group is required." See Page 2-5 of the Handbook (Emphasis added). The ALJ read these two portions of the Handbook to mean that the six bullet points that should comprise the documentation for the initial certification are inapplicable to subsequent certification periods, which is incorrect. All the factors a provider looks at when initially certifying a Medicaid recipient as being terminally ill are still relevant when making subsequent certifications, and should be considered. Thus, the Agency finds that it has substantive jurisdiction over the conclusions of law that are contained within Paragraphs 53 and 54 of the Recommended Order because they involve an interpretation of the Agency's rule, and that it is able to substitute conclusions of law that are as or more reasonable than those of the ALJ. § 120.57(1)(/), Fla. Stat. Therefore, the Agency grants Petitioner's First Exception, and modifies Paragraphs 53 and 54 of the Recommended Order as follows:

1. Dr. Talakkottur's testimony regarding the many patients he reviewed clarifies that he applied the six bullet points from the Handbook to his reviews of both certification and recertification decisions. However, Even though the six bullet points are prefaced with a paragraph beginning: "Documentation to support the terminal prognosis must accompany the initial certification of terminal illness," In other words, the six bullet pointsthey are net applicable to recertification decisions. A patient must still have a prognosis of less than six months to be recertified, butand the six bullet points no longer represent the appropriate factors that should

   be considered in making the decision to recertify the patient. lfl faetAdditionally, the Handbook clarifiesstates that "[f]or subsequent election periods, written certification from the hospice medical director or physician member of the interdisciplinary group is required."

2. In light of this elear distinction, Ddeference to the clinical judgment of the hospice physicians beoomes is no more significant for recertification periods. Dr. Talakkottur did not lend any credence to the "real-time" decisions of the hospice physicians. Instead, Dr. Talakkottur sought out ways to deny coverage and frequently based his decisions on bullet points that the patient was net-required to satisfy to support eligibility.

In its Second Exception, Petitioner takes exception to the portion of the Recommendation section of the Recommended Order, wherein the ALJ reserves jurisdiction to award costs, arguing the ALJ does not have the authority to do so. The Agency agrees with Petitioner that the ALJ cannot continue to have jurisdiction over this matter in order to determine the amount of costs due to Petitioner. Instead, costs are more appropriately determined in a separate

proceeding, as was stated by the ALJ in Agency for Health Care Administration v. Brown

Pharmacy, DOAH Case No. 05-3366MPI (Recommended Order November 3, 2006). Therefore, the Agency declines to adopt the ALJ's Recommendation as it relates to the issue of costs, and instead notifies the parties of the appropriate procedure for the determination of the costs that should be assessed in this matter in the "Ordered and Adjudged" section of this Amended Final Order.

FINDINGS OF FACT

The Agency adopts the findings of fact set forth in the Recommended Order.

CONCLUSIONS OF LAW

The Agency adopts the conclusions of law set forth in the Recommended Order, except

where noted supra.

IT IS THEREFORE ORDERED AND ADJUDGED THAT:

1. The Agency overpaid VITAS $2,287,790.49 for services provided to Medicaid recipients. This amount is the total of: 1) $298,967.93 in overpayments for Melbourne Patients 2, 5, 9, 18 and 20 that VITAS did not contest; 2) $425,146.56 in overpayments for Boynton Patients 4, 6, 16, 19, 20 and 23 that VITAS did not contest; 3) $590,068.46 in overpayments for Patients 5, 6, 7, 11, 17, 18, 19, 21, 23, 27, 33, 36 and 37 that VITAS did not contest; 4) $788,228.672 in overpayments found by the ALJ in the Recommended Order; 5) $37,920.40 in overpayments for Melbourne Patient 11 (FAR3 overpayment amount of $45,277.88 - $7,357.48 for the first 90-day hospice certification period that the ALJ allowed); 6) $66,244.14 in overpayments for Melbourne Patient 21 (FAR overpayment amount of $69,172.14 -

   $2,928.00 for the first 90-day hospice certification period allowed by the ALJ); and 7)

   
   

   $81,214.33 in overpayments for Boynton Patient 5 (FAR overpayment amount of

   
   

   $154,963.34 - $73,749.01 for the second 90-day hospice certification period allowed by the ALJ).4 Since VITAS has already repaid the Agency $5,401,615.18, which was the total of the amounts listed in the FARs for all three cases, VITAS is entitled to a refund of $3,113,824.69. The Agency shall refund this amount to VITAS within 30 days of the date of rendition of the Amended Final Order unless other payment arrangements have been made by the parties.

   
   

   
   

   2 The $954,488.60 that ALJ put as the overpayment amount in the Recommended Order erroneously includes sums for Boynton Patient 6 and Dade Patients 6, 17 and 36 that VITAS conceded to prior to the hearing.

   
   

   3 FAR stands for Final Audit Report.

   
   

   4 See Amended Joint Stipulation to Disputed Dates of Service for All Patients filed April 13, 2018; and Petitioner's Exhibits 223-225.

2. The Agency imposes a $448,191.92 fine5 on Respondent pursuant to rule 59G- 9.070(7)(e), Florida Administrative Code. Respondent shall make full payment of the fine to the Agency for Health Care Administration within 30 days of the rendition date of this Amended Final Order unless other payment arrangements have been agreed to by the parties. Respondent shall pay by check payable to the Agency for Health Care Administration and mailed to the Agency for Health Care Administration, Office of Finance and Accounting, 2727 Mahan Drive, Mail Stop 14, Tallahassee, Florida 32308.

3. Since the Agency has prevailed in this matter, it is entitled to recover the investigative, legal and expert witness costs it incurred in this matter. § 409.913(23), F.S. The parties shall attempt to agree to amount of investigative, legal, and expert witness costs for this matter. If the parties are unable to reach such agreement, either party may file a request for hearing with the Division of Administrative Hearings under this case style within 30 days of the date of rendition of this Amended Final Order, and the Administrative Law Judge who presided over this matter shall determine the amount of such costs.

DONE and ORDERED this 171-h day of /)ecvnb.Q.r , 2018, in Tallahassee,

Florida.

JUSTM.S£«oi,sEcRETARY

AGENCY FOR HEALTH CARE ADMINISTRATION

5 $1,000 per claim x 316 claims for Boynton, 382 claims for Dade and 268 claims for Melbourne = $966,000, so 20% cap is applied. $2,240,959.59 ($2,287,790.49 - $46,830.90 (overpayment amount for Dade Patient 34)) x .2 =

$448,191.92.

NOTICE OF RIGHT TO JUDICIAL REVIEW

A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW, WHICH SHALL BE INSTITUTED BY FILING THE ORIGINAL NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A COPY ALONG WITH THE FILING FEE PRESCRIBED BY LAW WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF THE RENDITION OF THE ORDER TO BE REVIEWED.

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true and correct copy of the foregoing Amended Final Order has been furnished to the persons named below by the method designated on this /ff:­

day o ,2018.

. SHOO , ncy Clerk Agency for Health Care Administration 2727 Mahan Drive, MS #3

Tallahassee, Florida 32308

(850) 412-3630

COPIES FURNISHED TO:

Honorable Mary Li Creasy Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060 (via electronic filing)

Christopher Brian Lunny, Esquire Marion Drew Parker, Esquire Jordann Allen, Esquire

Jeffrey L. Frehn, Esquire Ratley Law Firm

301 South Bronough Street South 200

Tallahassee, Florida 32301

(via electronic mail to clunny@radeylaw.com and dparker@radeylaw.com, jallen@radeylaw.com, and jfrehn@radeylaw.com)

Rex D. Ware, Esquire

Moffa, Sutton & Donnini, P.A. 3500 Financial Plaza, Suite 330

Tallahassee, Florida 32312

(via email to rexware@floridasalestax.com)

Joseph B. Brannen, Esquire Matthew Bryant, Esquire Pennington, P.A.

215 South Monroe Street, Second Floor Post Office Drawer 10095

Tallahassee, Florida 32302-2095

(via electronic mail to breck@penningtonlaw.com and mbryant@penningtonlaw.com)

R. Terry Rigsby, Esquire Pennington, P.A.

750 Middlewood Drive

Tallahassee, Florida 32312

(via electronic mail to trigsby@penningtonlaw.com)

Medicaid Program Integrity Office of the Inspector General (via electronic mail)

Medicaid Accounts Receivable Finance & Accounting

(via electronic mail)

Docket for Case No: 17-000794MPI

Orders for Case No: 17-000794MPI