Recommendation Based on the foregoing Findings Of Fact and Conclusions Of Law, it is recommended that the Respondent, the Department of Administration, enter a final order denying coverage for the orthodontia recommended for Sandra Walsh. RECOMMENDED this 18th day of March, 1988, in Tallahassee, Florida. J. LAWRENCE JOHNSTON Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 18th day of March, 1988.
The Issue The basic issue in this case is whether the Petitioner is entitled to a waiver of the limitations in the state group health self insurance plan regarding pre-existing conditions during the first 12 months of coverage under the plan.
Findings Of Fact Based on the stipulations of the parties, on the testimony presented at the hearing, and on the exhibits received in evidence, I make the following findings of fact. The Petitioner was first employed by the Department of Transportation as a Clerk Typist Specialist on October 31, 1986. As a new employee, the Petitioner was entitled to select health insurance under the state group health self insurance plan or with a participating health maintenance organization (HMO). The state group health self insurance plan and the HMO's each have different benefits and premiums. The Petitioner's direct supervisor is Ms. Gwen Molander. On October 30, 1986, the day prior to her first day of employment, the Petitioner met with her supervisor to sign the employment paperwork. On that day Ms. Molander called the Department of Transportation personnel office in Lake City for the purpose of finding out whether the state group health self insurance plan would cover pre-existing allergy conditions of the Petitioner's son. Ms. Molander specifically asked the Lake City personnel office if the plan would cover the Petitioner's son if the son was under the care of an allergist. The words "pre- existing condition" were not used in the conversation Ms. Molander had with the Lake City personnel office. The Lake City personnel office told Ms. Molander that the Petitioner's son would be covered even if it was not an open enrollment period. The Petitioner authorized a "double-up" deduction so the health insurance would be effective as of December 1, 1986. The Petitioner's son has been covered as a dependent under the Petitioner's health insurance since December 1, 1986. Based on the information from the Lake City personnel office, the Petitioner believed that the state group health self insurance plan would provide coverage for all of her son's medical expenses without any limitation regarding pre-existing conditions. The Petitioner's son had a pre-existing allergy condition for which he received medical treatment in December of 1986 and thereafter. Since December of 1986 the Petitioner has incurred medical bills of approximately $2,000.00 for treatment related to her son's pre-existing allergy condition. The state group health self insurance plan has refused to pay any of the medical expenses related to the treatment of the pre-existing allergy condition of the Petitioner's son. The state group health self insurance plan contains a provision to the effect that "no payment shall be made for pre- existing conditions during the first 12 months of coverage under the Plan." Accordingly, the refusal to pay described above is consistent with the provisions of the state group health self insurance plan. At the time the Petitioner chose to enroll in the state group health self insurance plan, she could also have chosen any of three HMO programs available to state employees in he Gainesville area. Petitioner chose the state group health self insurance plan because of her belief that it provided coverage for her son's pre-existing allergy condition. There is no competent substantial evidence in the record in this case regarding the coverage provided by the three available HMO's, the limitations (if any) on the coverage, or the cost to the employee of such coverage. At the time the Petitioner chose to enroll in the state group health self insurance plan, her employing office did not have any written information regarding the health insurance options available to new employees. There is no evidence that the Petitioner attempted to obtain information regarding health insurance options from any source other than her direct supervisor and the Lake City personnel office. On the insurance enrollment form signed by the Petitioner, dated October 31, 1986, the Petitioner was put on notice and acknowledged that coverage and the effective dates of coverage under the state group health self insurance plan were governed by Rule Chapter 22K-1, Parts I and II, Florida Administrative Code, and by the plan benefit document, "regard-less of any statements or representations made to me. " The Petitioner has previously worked in the insurance field and she is familiar with limitations on coverage for pre-existing conditions.
Recommendation On the basis of all of the foregoing, it is recommended that the Department of Administration issue a final order in this case denying the relief requested by the Petitioner and dismissing the petition in this case. DONE AND ENTERED this 29th day of May, 1987, at Tallahassee, Florida. MICHAEL M. PARRISH Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 29th day of May, 1987. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-1485 The following are my specific rulings on the proposed findings of fact submitted by both parties: Proposed findings submitted by Petitioner As noted in the introductory portion of the recommended order in this case, the Petitioner's post-hearing submission consists of a letter dated May 12, 1987. Although the letter does not contain any statements which are identified as proposed findings of fact, in light of the lesson taught by Kinast v. Department of Professional Regulation, 458 So.2d 1159 (Fla. 1st DCA 1984), all factual assertions in the letter of May 12, 1987, have been treated as though they were proposed findings of fact. The references which follow are to the unnumbered paragraphs and sentences of the letter of May 12, 1987. First unnumbered paragraph: This is an introductory comment only. Second unnumbered paragraph: First sentence is rejected as a proposed finding because not supported by evidence in the record. Second sentence is a statement of position rather than a proposed finding. Third sentence is rejected as a proposed finding because not supported by evidence in the record. Fourth sentence is a statement of the relief requested rather than a proposed finding. Fifth sentence is rejected as a proposed finding because it is inconsistent with the greater weight of the evidence. Third unnumbered paragraph: This entire paragraph is rejected as proposed findings because it consists of statement of position and argument rather than proposed facts. Proposed findings submitted by Respondent The Respondent's proposed findings of fact are contained in twelve numbered paragraphs in Respondent's proposed recommended order. The paragraph references which follow are to each of those twelve paragraphs. Paragraph 1: Accepted. Paragraph 2: First sentence accepted. Second sentence is rejected in part and accepted in part; first ten words are rejected as not supported by competent substantial evidence in the record. The remainder of the sentence is accepted. Paragraph 3: Accepted. Paragraph 4: Accepted in substance with correction of confused dates and deletion of irrelevant details. Paragraph 5: Accepted. Paragraph 6: Accepted in substance. Paragraph 7: Accepted in substance. Paragraph 8: Accepted in substance. Paragraph 9: First sentence accepted in substance. Second sentence rejected as not supported by competent substantial evidence. Paragraph 10: Accepted in substance. Paragraph 11: Accepted in substance. Paragraph 12: Rejected as irrelevant due to the fact that no such literature was available at Petitioner's employing office. COPIES FURNISHED: Ms. Juanita L. Resmondo Department of Transportation Maintenance Office Post Office Box 1109 Gainesville, Florida 32602 Augustus D. Aikens, Jr., Esquire General Counsel Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550 Adis Vila, Secretary Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550
The Issue Whether Respondent committed the acts alleged in the Administrative Complaint in violation of Chapter 626, Florida Statutes.
Findings Of Fact At all times pertinent to the dates and occurrences referred to or alleged in these proceedings, Respondent was licensed and eligible for licensure as a nonresident life and health insurance agent in this state. During the period from January 22, 1987 to April 1, 1988, Respondent was licensed as a nonresident life and health insurance agent with United American Insurance Company. On March 19, 1987, Respondent completed and filled out an application for medicare supplement insurance with United American on behalf of Aldon D. Cosson, who could not read and write. Mr. Cosson resided in DeFuniak Springs, Florida, where Respondent completed the application. Said application, referred to in paragraph 3 above, contained, as question 11, the following: "Within the past year, have you had, or been treated for, internal cancer?" At the time that Respondent was completing the application, Mr. Cosson and Ms. Rose Heiter, who was present and witnessed the events, responded' to the question regarding internal cancer by telling Respondent that Mr. Cosson had inoperable lung cancer. At the time of the taking of said application, Respondent completed and filled in a "no" response to question 11. The response to question 11, completed and filled in by Respondent, was in direct conflict with the responses given by Mr. Cosson and Ms. Heiter. On April 1, 1987, United American Insurance Company issued its policy, numbered 4997216, to Aldon D. Cosson, based upon the information provided to it in said application. United American Insurance Company would not have issued the above- mentioned policy, nor any other medicare supplement product, if the answer to question 11 regarding internal cancer had been answered "yes". Said application contained, as question 4, a request for a listing of Mr. Cosson's existing medicare supplement insurance policies. Said application indicated that Mr. Cosson has existing medicare supplement insurance in the form of a policy, numbered 1026302, with Associated Doctors Health and Life Insurance Company. At the time of said application to United American Insurance Company, Mr. Cosson's existing coverage with Associated Doctors Health and Life Insurance Company was paying his medicare supplement claims. The policy for which Mr. Cosson applied was to replace the existing medicare supplement coverage which Mr. Cosson had with Associated Doctors Health and Life Insurance Company. The policy from Associated Doctors was cancelled; however, United American did not pay any benefits, electing to return all premiums tendered by Mr. Cosson. This left Mr. Cosson without insurance coverage, and his estate suffered the expenses of his last illness. Cancellation of a medicare supplement insurance policy, which is not subject to the exclusions for preexisting conditions of adverse health, is not in the best interest of a potential applicant who has those preexisting conditions of adverse health.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that the license of Respondent be revoked, as required by Section 626.611, Florida Statutes. DONE AND ORDERED this 14 day of March, 1990, in Tallahassee, Leon County, Florida. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 14 day of March, 1990. COPIES FURNISHED: Mr. Tom Gallagher State Treasurer and Insurance Commissioner Department of Insurance The Capitol, Plaza Level Tallahassee, FL 32399-0300 Don Dowdell, Esq. General Counsel Department of Insurance The Capitol, Plaza Level Tallahassee, FL 32399-0300 Clyde W. Galloway, Jr., Esq. Division of Legal Affairs 200 East Gaines Street 412 Larson Building Tallahassee, FL 32399-0300 Mr. John Matt Early, pro se 8841 Lott Road Route 2, Box 95-B Wilmer, AL 36587
Findings Of Fact Petitioner was employed with the Collier County Health Department, Department of Health and Rehabilitative Services, on March 9, 1973. Petitioner's date of birth is November 26, 1916. On October 1, 1980, Petitioner's medical insurance coverage was entered into the payroll system under the Spouse Program, State of Florida plan. The proper amount of premiums under the Spouse Program were paid to Blue Cross Blue Shield from October 1, 1980, up to and including June, 1983. On November 26, 1981, Petitioner reached the age of 65. Under the State plan, coverage at age 65 is automatically reduced and changed to Medicare Supplement Coverage. In order to have remained fully covered, Petitioner would have had to apply for the Medicare insurance prior to reaching age 65, which he did not do. Due to both spouses being covered, there was no change in policy premium deductions even after Petitioner reached age 65 and his State coverage was reduced. The Blue Cross Blue Shield (State program) paid several claims of Petitioner subsequent to his 65th birthday and through December, 1982. On March 8, 1983, Petitioner was admitted to the hospital and on March 11, 1983, heart bypass surgery was performed. Respondent normally notifies the employee and employing agency of the coverage change prior to the employee's 65th birthday, as required by Rule 22K- 1.16, F.A.C. In this case, Respondent did not do so due to a failure in its computer program. Petitioner could have determined that he was required to apply for Medicare coverage had he read in detail a copy of the plan's benefit booklet furnished to all State employees in 1978.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent direct its insurer to pay Petitioner's claims arising from his March, 1983, hospitalization. DONE and ENTERED this 2nd day of September, 1983, in Tallahassee, Florida. R. T. CARPENTER, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 2nd day of September, 1983. COPIES FURNISHED: Mr. John H. Adams 2596 Linwood Avenue Naples, Florida 33962 Daniel C. Brown, Esquire Department of Administration 435 Carlton Building Tallahassee, Florida 32301 Nevin G. Smith, Secretary Department of Administration Carlton Building Tallahassee, Florida 32301
The Issue The issue for consideration in this hearing was whether Petitioner was entitled to insurance coverage reimbursement for items claimed as a result of his son's hospitalization at a specialty hospital in April, 1989.
Findings Of Fact At all times pertinent to the issues herein, Petitioner, Claud E. Leiby, was employed by the State of Florida and was a member of the State Group Health Self Insurance Plan. The State of Florida, Department of Administration, Division of State Employees' Insurance, is the state agency responsible for administering the Group Health Self Insurance Plan in Florida. On April 5, 1989, Petitioner's son, Floyd (Chris), attempted to take his own life. Chris is hearing impaired. He is a 22 year old who was, at the time, six months away from earning his Bachelor of Science degree in Computer Engineering Technology at Tampa Technical Institute. Prior to this suicide attempt in April, 1989, Chris had been seen by a psychologist who referred him to a psychiatrist. Chris had previously been seen by a psychiatrist for a drug abuse problem several years before. Approximately two years ago, Chris was admitted to Palms Hospital in Sarasota, an institution covered by the insurance plan in issue. At that time, the hospital represented it would provide an interpreter for the deaf and those other specialized personnel necessary for appropriate treatment of a hearing impaired individual. However, after several days of treatment which were singularly non-beneficial because of the fact that no interpreter was provided and Chris could not lip read, the treatment was terminated and Chris was discharged. The Leibys felt, based on that experience, that appropriate service could or would not be provided at a facility covered by the plan, and as a result, when Chris attempted to take his life on April 5, 1989, did not even attempt to hospitalize him in either of the covered facilities in Sarasota County, Sarasota Palms Hospital or Sarasota Memorial Hospital. Instead, they had him admitted to Horizon Hospital in Sarasota, a psychiatric specialty hospital which is the only hospital in the area providing a program for the psychiatric treatment of the hearing impaired even though they had been advised such treatment would not be covered. Their conclusion as to the lack of availability of other qualified treatment may not have been accurate, however. Dr. Curran, director of mental health services at Memorial indicated that facility could and would provide adequate treatment for the hearing impaired. This is inconsistent with the Petitioner's prior experience. The Leibys felt that due to the suicidal attempt, the situation constituted an immediate crisis. However, after several days of Chris' hospitalization at Horizon, they were advised that their coverage under the state plan would not cover the incurred expenses at that facility. The Plan administrator indicated the Petitioners were not covered because of the terms of the plan which exclude services and supplies provided by a specialty institution. Further, the Division took the position that since Chris attempted to take his own life, and since the plan excludes coverage for services and supplies resulting from an intentional self-inflicted injury, it was "unlikely" reimbursement would be made even if Chris had been admitted to one of the eligible hospitals. Petitioner claims that the Division's interpretation of the rule and the plan provisions constitutes a form of discrimination against the handicapped which is prohibited by federal and state law. After Chris was discharged from Horizon Hospital, he had another episode while at work and was taken to a medical facility in St. Petersburg. After four days, he was released and taken to see Dr. Douglas R. Elliott, a psychiatrist, who was unable to treat him successfully without the services of an interpreter. Dr. Elliott indicated that Ms. Leiby, who acted as an interpreter on the first session, could not continue to act in that capacity, considering the issues that needed to be addressed. In the doctor's opinion, the treatment Chris received at Horizon was both necessary and beneficial. The Plan brochure provided to state employees contains numerous provisions pertinent to this hearing. On Page 3, the definition of a hospital specifically includes a "specialty institution" and at page 9, the section on Limitations (on coverage) indicates, "Payment for inpatient services rendered by a hospital and/or specialty institution while confined for alcoholism or drug addiction, and/or rendered by a hospital while confined for alcohol or drug addiction or mental or nervous conditions, shall be made for not more than thirty-one (31) days of confinement during a calendar year. Specialty institutions are, in the Summary of Benefits section found on Page 6, identified as being permitted for alcohol/drug impaired employees only. In the Exclusions portion, found on pages 11 and 12, services and supplies provided by a specialty institution or residential facility (with the exception of the alcohol/drug treatment for employees) are excluded as are services and supplies provided by a skilled nursing facility for the treatment of an insured for alcoholism, drug addiction, (other than for employees), or mental or nervous conditions. The Plan Benefit Document itself, which was not previously provided to Petitioner, at page 24, defines a "specialty institution" as a "licensed facility providing an inpatient rehabilitation program for the treatment of persons suffering from alcohol or drug abuse or mental or nervous conditions." At Section VII L, dealing with Exclusions, "...services and supplies provided by a specialty institution, except as provided under Section II G, (treatment relating to alcoholism or drug addiction for the employee only), are excluded from coverage." The Division has defined these terms as meaning, in substance, that a specialty institution is specifically excluded except when a covered employee asks approval for entry into such an institution for alcohol or drug addiction. Otherwise, they have been excluded since implementation of the plan in 1972, because of cost. If these institutions were to be included, the additional costs would, according to Mr. Seaton, mean premium rates to the participants would have to be increased. The benefit document, as it exists, was constructed with the assistance of Blue Cross/Blue Shield and other consultants. It was the intent of the Department to provide services that a majority of the employees and their families need. To change the benefit document requires legislative approval. The plan is not intended to deny coverage to the handicapped. An "appropriate" service was available to Chris at the time of his admission to Horizon Hospital in April, 1989 under the state plan. Further, in Mr. Seaton's opinion, since the injury was self-inflicted, even if Chris had been admitted to an eligible hospital, coverage would not have been available. This latter position is unsupportable as an improper interpretation of the relevant provision. To insure cost reimbursement, Petitioner would have had to have a physician admit Chris to an acute care hospital such as Palms or Memorial, and in that case, according to Seaton, the state would have allowed up to 31 days of inpatient service. Seaton indicates that Section 504 of The Rehabilitation Act of 1973, was not considered in determining benefits to be covered. In his opinion, the "majority of employee needs" were covered and handicapped employees are covered to the same degree as non-handicapped employees. Family coverage for an employee does not include provisions to cover special needs of family members. Since treatment for handicapped is covered as a matter of course, no need was seen to make specific provision for handicapped individuals. The limitations, exclusions, or benefits provided are the same for all members and are provided to the handicapped to the same extent as to the non-handicapped. When asked if the patient had been initially admitted to a general hospital and thereafter referred to a specialty hospital as a matter of appropriate medical treatment by a covered provider, would that specialty admission be covered, Mr. Seaton replied, "absolutely not."
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that the Petition for reimbursement for Chris' hospitalization at Horizon Hospital be denied. RECOMMENDED this 24th day of October, 1989, in Tallahassee, Florida. ARNOLD H. POLLOCK, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 24th day of October, 1989. APPENDIX TO RECOMMENDED ORDER, CASE NO. 89-4186 The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes on all of the Proposed Findings of Fact submitted by the parties to this case. None submitted by Petitioner: For the Respondent: 1.-5. Accepted and incorporated herein. 6.-7. Accepted and incorporated herein. Accepted. Accepted. Petitioner submitted the hospital bill subsequent to the hearing and after both parties had rested. Respondent moved to strike this evidence but the motion was denied. The amount of the hospital bill is now known, but in light of the Findings and Conclusions is not relevant. Accepted and incorporated herein. Accepted and incorporated herein. Accepted except for last sentence. Petitioner's opinion is based on prior experience. Accepted. This is opinion only. Not a Finding of Fact but a restatement of testimony. The substance of the testimony is accepted, however. Accepted and incorporated herein. 16.-18. Accepted and incorporated herein. 19. Accepted as to lack of discrimination. COPIES FURNISHED: Claude E. Leiby 321 East Lake Drive Sarasota, Florida 34232 Augustus D. Aikens, Jr., Esquire Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550 A. J. McMullian, III Interim Secretary Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550
The Issue The principal issue in this case is whether the Petitioner is entitled to reimbursement under the State of Florida Group Health Insurance Plan for certain health care expenses she has incurred since she became a State employee and enrolled in the Plan. The Petitioner contends that she is entitled to reimbursement and to attorney's fees. The Respondent contends that the Petitioner is entitled to neither. The central factual dispute is whether the Petitioner's claim for benefits is barred by the provision in the Plan which excludes benefits for pre-existing conditions during the first 365 days of participation in the Plan. At the formal hearing in this case, the Petitioner testified on her own behalf and also presented the testimony of Donald M. Whitley, II, Ph.D. The Respondent presented the testimony of Mr. William Seaton. Both parties offered exhibits. Also, the parties stipulated to the filing of the transcript of the deposition of F. A. Munasifi, M.D., as a late-filed exhibit. Subsequent to the hearing both parties filed proposed recommended orders, which have been carefully considered during the preparation of this recommended order. Specific rulings on the findings of fact proposed by both parties are contained in the Appendix which is attached to and incorporated into this recommended order.
Findings Of Fact Based on the stipulations and admissions of the parties, on the exhibits received in evidence, and on the testimony of the witnesses at hearing, I make the following findings of fact. Findings based on admissions Petitioner, Terri J. Ganson, (hereinafter "Petitioner" or "Ganson") enrolled in the State of Florida Group Health Insurance Plan (hereinafter "Plan") in January, 1986, and has been validly enrolled as a member in good standing since said date. The pre-existing condition exclusion appears as Subsection VIII.C. of the State Employees Group Self-Insurance Document and provides: For any accident or illness for which an insured received diagnostic treatment or received services within three hundred and sixty-five (365) consecutive days prior to the effective date of coverage, no payment will be allowed for services related to such accident or illness which are received during the three hundred and sixty-five (365) conse- cutive days subsequent to the effective date of coverage; however covered services related to such accident or illness which are received after three hundred and sixty-five (365) consecutive days of coverage are cover- ed by the plan. The Plan, at Subsection I.AE., defines "illness" as follows: "Illness" means physical sickness or disease, pregnancy, bodily injury, congenital anomaly or mental or nervous disorder. Illness for the purposes of this Plan shall entitle an insured to benefits for any medically nece- ssary services related to elective surgical procedures performed by a physician for the purpose of sterilization. By the terms of the Plan, the pre-existing condition paragraph of the Plan applied to claims filed by Petitioner for treatments received during the period from February 1, 1986, until January 31, 1987. Those claims submitted by Petitioner or on Petitioner's behalf for reimbursement under the Plan which were denied on the basis of the pre-existing condition exclusion and which are the subject of this dispute amount to a total of $5,682.15 for services provided by the following providers in the respective amounts shown: a. TMRMC $2,352.65 b. Dr. Shamis $225.50 c. Dr. Munasifi $50.00 d. Biomedical Ref. $50.00 e. Dr. Whitley $3,000.00 The services received by Petitioner for which reimbursement is in dispute were services actually received by Petitioner, Petitioner was charged for such services in the aggregate amounts specified, such services were medically necessary treatments, such services were rendered for the treatment of bipolar disorder, and such services were otherwise covered by the Plan. Petitioner is entitled to reimbursement for the amount of the charges for such services, without limitation or exclusion, if said condition for which services were rendered did not constitute a pre-existing condition (i.e., an "accident or illness" for which Petitioner "received diagnostic treatment or received services within three hundred and sixty-five days prior to . . ." her enrollment in the Plan. Findings based on the testimony and the exhibits Prior to her enrollment in the Plan, the Petitioner had been diagnosed as having situational depression, for which she had received treatment prior to her enrollment in the Plan. Part of that treatment occurred within three hundred sixty-five days immediately preceding Petitioner's enrollment in the Plan. Prior to her enrollment in the Plan, the Petitioner had never been diagnosed as having bipolar affective disorder. Prior to her enrollment in the Plan, the Petitioner had never been treated for bipolar affective disorder. Bipolar affective disorder is believed to be caused by a deregulation of the chemical neurotransmitters in the brain. The primary treatment modality for bipolar affective disorder is the administration of lithium carbonate. The administration of lithium carbonate is specific for bipolar affective disorder and the use of lithium carbonate is one of the main differences between treatment for bipolar affective disorder and the type of depression for which Petitioner was treated prior to her enrollment in the Plan. Behavioral therapy may also be of assistance in the treatment of the symptoms of bipolar affective disorder, as it is in the treatment of the symptoms of other conditions which cause depression. Situational depression and bipolar affective disorder are separate and distinct conditions; they are not the same condition. Specifically, the former is not an earlier stage of the latter. The fact that both conditions have certain common symptoms (i.e., periods of depression) does not mean that they are the same condition.
Recommendation Based on all of the foregoing, I recommend the entry of a Final Order to the following effect: Reimbursing the Petitioner for her medical expenses in the amounts stipulated to by the parties, namely, $5,682.15; and Denying the Petitioner's claim for attorney's fees in this proceeding. DONE AND ENTERED this 30th day of November, 1987, at Tallahassee, Florida. MICHAEL M. PARRISH, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 30th day of November, 1987. APPENDIX TO RECOMMENDED ORDER IN CASE NO. 87-1654 The following are my specific rulings on all of the findings of the findings of fact proposed by the parties: Findings proposed by Petitioner: Paragraph 1 (including subparts [a] through [f]): Accepted. Paragraphs 2 and 3: Rejected as unnecessary details in light of admitted facts. Paragraphs 4 and 5: Accepted in substance with most details omitted as unnecessary. Paragraph 6: First sentence accepted. Second sentence rejected as unnecessary details. Paragraphs 7, 8, 9, 10, 11, 12, 13, and 14: Rejected as unnecessary details in light of admitted facts. Paragraphs 15, 16, 17, and 18: Rejected as subordinate and unnecessary details. Paragraph 19: First sentence accepted. Second sentence rejected as subordinate and unnecessary details. Paragraphs 20 and 21: Accepted. Paragraphs 22, 23, 24, 25, 26, 27, and 28: Rejected as subordinate and unnecessary details. Paragraph 29: First sentence accepted in substance. Remainder of this paragraph rejected as subordinate and unnecessary details. Paragraphs 30, 31 and 32: Accepted in substance. Paragraphs 33, 34, and 35: Rejected as unnecessary details in light of admitted facts. Paragraphs 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, and 46: Rejected as subordinate and unnecessary details. Paragraphs 47, 48, 49, 50, and 51: Rejected as consti-tuting summaries of argument rather than proposed findings of fact. Findings proposed by Respondent: Paragraphs 1, 2, and 3: Rejected as unnecessary details in light of admitted facts, with exception of proposed finding regarding effective date of coverage. Paragraphs 4, 5, and 6: Accepted in substance. Paragraph 7: Accepted in substance with unnecesary details deleted. Paragraph 8: Rejected as subordinate and unnecessary details. Paragraphs 9 and 10: Rejected as unnecessary details in light of the admitted facts and also as not entirely consistent with the greater weight of the evidence. Paragraph 11: Rejected as subordinate and unnecessary details. Paragraph 12: Accepted in substance as to date of first diagnosis. Rejected insofar as it suggests that Dr. Munasifi "refused" to make a particular statement. Paragraph 13: Rejected as subordinate and unnecessary details. Paragraph 14: Accepted as to nature of diagnosis. The remainder is rejected as subordinate and unnecessary details. Paragraph 15: First sentence is accepted. Second sentence is rejected as contrary to the greater weight of the evidence. Third and fourth sentences are rejected as irrelevant or as subordinate and unnecessary details. Paragraphs 16 and 17: Rejected as subordinate and unnecessary details. Paragraph 18: Rejected as irrelevant and as an over- simplification which suggests an inference not warranted by the greater weight of the evidence. Final unnumbered summary paragraph: Rejected as constituting a summary of testimony rather than proposed findings of fact and, in any event, as subordinate and unnecessary details. COPIES FURNISHED: Kenneth D. Kranz, Esquire Eric B. Tilton, P.A. P. O. Drawer 550 Tallahassee, Florida 32302 Augustus D. Aikens, Jr., Esquire General Counsel Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550 Adis Vila, Secretary Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550 =================================================================
Findings Of Fact Petitioner resigned from State Government on July 23, 1987. At the time of his resignation, Petitioner was covered under the Florida State Group Health Insurance Plan. His wife, who is a diabetic, was also covered under Petitioner's insurance. Upon termination Petitioner was eligible for continuation of coverage benefits under the federal COBRA Act. However, prior to receiving any notice of his COBRA rights, Petitioner elected to continue his State Employees' Insurance for two months from July 1, 1987 and then begin coverage under his new employer's insurance plan. 2/ Petitioner made advance payment on the 2 months additional coverage. The payments carried his State Employees' health insurance through September 1, 1987 when it was terminated. DOA notified Petitioner on August 27, 1987, of his right to elect continuation of coverage under the COBRA Act. This notice complied with the notice requirements under the COBRA Act. COBRA provides continued health insurance coverage for up to (18) months, after a covered employee leaves employment. However, coverage does not continue beyond the time the employee is covered under another group health plan. COBRA simply fills the gap between two different employers group health insurance plans so that an employee's group health insurance does not lapse while the employee changes jobs. Petitioner's new employer's health coverage began around September 1, 1987. After Petitioner had begun coverage under his new insurance plan, he discovered that his wife's preexisting diabetic condition would not be covered. However, no evidence was presented that Petitioner, within 60 days of September 1, 1987 requested the Division of State Employee's Insurance to continue his insurance coverage pursuant to COBRA. Moreover, Petitioner's COBRA rights terminated when he began his coverage under his new employer's health plan.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Administration enter a Final Order denying Petitioner's request for continuation of coverage under COBRA. DONE and ENTERED this 5th day of April, 1989, in Tallahassee, Florida. DIANE CLEAVINGER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 5th day of April, 1989.
The Issue The issue for determination is whether Petitioners’ Interim Rate Request (IRR) for an increase should be granted.
Findings Of Fact AHCA is the agency of state government responsible for the implementation and administration of the Medicaid Program in the State of Florida. AHCA is authorized to audit Medicaid Cost Reports submitted by Medicaid Providers participating in the Medicaid Program. Avante at Jacksonville and Avante at St. Cloud are licensed nursing homes in Florida that participate in the Medicaid Program as institutional Medicaid Providers. On May 23, 2007, Avante at Jacksonville entered into a settlement agreement with the representative of the estate of one of its former residents, D. P. The settlement agreement provided, among other things, that Avante at Jacksonville would pay $350,000.00 as settlement for all claims. Avante at Jacksonville paid the personal representative the sum of $350,000.00. By letter dated July 16, 2007, Avante at Jacksonville requested an IRR effective August 1, 2007, pursuant to the Plan Section IV J.2., for additional costs incurred from self-insured losses as a result of paying the $350,000.00 to settle the lawsuit. Avante at Jacksonville submitted supporting documentation, including a copy of the settlement agreement, and indicated, among other things, that the costs exceeded $5,000.00 and that the increase in cost was projected at $2.77/day, exceeding one percent of the current Medicaid per diem rate. At all times pertinent hereto, the policy held by Avante at Jacksonville was a commercial general and professional liability insurance policy. The policy had $10,000.00 per occurrence and $50,627.00 general aggregate liability limits. The policy was a typical insurance policy representative of what other facilities in the nursing home industry purchased in Florida. The policy limits were typical limits in the nursing home industry in Florida. By letter dated July 18, 2007, AHCA denied the IRR on the basis that the IRR failed to satisfy the requirements of Section IV J. of the Plan, necessary and proper for granting the request. Avante at Jacksonville contested the denial and timely requested a hearing. Subsequently, Avante at Jacksonville became concerned that, perhaps, the incorrect provision of the Plan had been cited in its IRR. As a result, a second IRR was submitted for the same costs. By letter dated October 22, 2007, Avante at Jacksonville made a second request for an IRR, this time pursuant to the Plan Section IV J.3., for the same additional costs incurred from the self-insured losses as a result of paying the $350,000.00 settlement. The same supporting documentation was included. Avante at Jacksonville was of the opinion that the Plan Section IV J.3. specifically dealt with the costs of general and professional liability insurance. By letter dated October 30, 2007, AHCA denied the second request for an IRR, indicating that the first request was denied based on “all sub-sections of Section IV J of the Plan”; that the second request failed to satisfy the requirements of the Plan Section IV J.3. and all sections and sub-sections of the Plan “necessary and proper for granting [the] request.” Avante at Jacksonville contested the denial and timely requested a hearing. On October 19, 2007, Avante at St. Cloud entered a settlement agreement with the personal representative of the estate of one of its former residents, G. M. The settlement agreement provided, among other things, that Avante at St. Cloud would pay $90,000.00 as settlement for all claims. Avante at St. Cloud paid the personal representative the sum of $90,000.00. By letter dated December 10, 2007, Avante at St. Cloud requested an IRR effective November 1, 2007, pursuant to the Plan Section IV J, for additional costs incurred as a result of paying the $90,000.00 to settle the lawsuit. Avante at St. Cloud submitted supporting documentation, including a copy of the settlement agreement, and indicated, among other things, that the increase in cost was projected at $2.02/day, exceeding one percent of the current Medicaid per diem rate. At all times pertinent hereto, the policy held by Avante at St. Cloud was a commercial general and professional liability insurance policy. The policy had $10,000.00 per occurrence and $50,000.00 general aggregate liability limits. The policy was a typical insurance policy representative of what other facilities in the nursing home industry purchased in Florida. The policy limits were typical limits in the nursing home industry in Florida. By letter dated December 12, 2007, AHCA denied the IRR on the basis that the IRR failed to satisfy the requirements of “Section IV J of the Plan necessary and proper for granting [the] request.” Avante at St. Cloud contested the denial and timely requested a hearing. Insurance Policies and the Nursing Home Industry in Florida Typically, nursing homes in Florida carry low limit general and professional liability insurance policies. The premiums of the policies exceed the policy limits. For example, the premium for a policy of Avante at Jacksonville to cover the $350,000.00 settlement would have been approximately $425,000.00 and for a policy of Avante at St. Cloud to cover the $90,000.00 settlement would have been approximately $200,000.00. Also, the policies have a funded reserve feature wherein, if the reserve is depleted through the payment of a claim, the nursing home is required to recapitalize the reserve or purchase a new policy. That is, if a policy paid a settlement up to the policy limits, the nursing home would have to recapitalize the policy for the amount of the claim paid under the policy and would have to fund the loss, which is the amount in excess of the policy limits, out-of-pocket. Florida’s Medicaid Reimbursement Plan for Nursing Homes The applicable version of the Plan is Version XXXI. AHCA has incorporated the Plan in Florida Administrative Code Rule 59G-6.010. AHCA uses the Plan in conjunction with the Provider Reimbursement Manual (CMS-PUB.15-1)3 to calculate reimbursement rates of nursing homes and long-term care facilities. The calculation of reimbursement rates uses a cost- based, prospective methodology, using the prior year’s costs to establish the current period per diem rates. Inflation factors, target ceilings, and limitations are applied to reach a per patient, per day per diem rate that is specific to each nursing home. Reimbursement rates for nursing homes and long-term care facilities are typically set semi-annually, effective on January 1 and July 1 of each year. The most recent Medicaid cost report is used to calculate a facility’s reimbursement rate and consists of various components, including operating costs, the direct patient care costs, the indirect patient care costs, and property costs. The Plan allows for the immediate inclusion of costs in the per diem rate to Medicaid Providers under very limited circumstances through the IRR process. The interim rate’s purpose is to compensate for the shortfalls of a prospective reimbursement system and to allow a Medicaid Provider to increase its rate for sudden, unforeseen, dramatic costs beyond the Provider’s control that are of an on-going nature. Importantly, the interim rate change adjusts the Medicaid Provider’s individual target rate ceiling to allow those costs to flow ultimately through to the per diem paid, which increases the amount of the Provider’s overall reimbursement. In order for a cost to qualify under an interim rate request, the cost must be an allowable cost and meet the criteria of Section IV J of the Plan. The Plan provides in pertinent part: IV. Standards * * * J. The following provisions apply to interim changes in component reimbursement rates, other than through the routine semi- annual rate setting process. * * * Interim rate changes reflecting increased costs occurring as a result of patient or operating changes shall be considered only if such changes were made to comply with existing State or Federal rules, laws, or standards, and if the change in cost to the provider is at least $5000 and would cause a change of 1 percent or more in the provider’s current total per diem rate. If new State or Federal laws, rules, regulations, licensure and certification requirements, or new interpretations of existing laws, rules, regulations, or licensure and certification requirements require providers to make changes that result in increased or decreased patient care, operating, or capital costs, requests for component interim rates shall be considered for each provider based on the budget submitted by the provider. All providers’ budgets submitted shall be reviewed by the Agency [AHCA] and shall be the basis for establishing reasonable cost parameters. In cases where new State or Federal requirements are imposed that affect all providers, appropriate adjustments shall be made to the class ceilings to account for changes in costs caused by the new requirements effective as of the date of the new requirements or implementation of the new requirements, whichever is later. Interim rate adjustments shall be granted to reflect increases in the cost of general or professional liability insurance for nursing homes if the change in cost to the provider is at least $5000 and would cause change of 1 percent or more in the provider’s current total per diem. CMS-PUB.15-1 provides in pertinent part: 2160. Losses Arising From Other Than Sale of Assets A. General.—A provider participating in the Medicare program is expected to follow sound and prudent management practices, including the maintenance of an adequate insurance program to protect itself against likely losses, particularly losses so great that the provider’s financial stability would be threatened. Where a provider chooses not to maintain adequate insurance protection against such losses, through the purchase of insurance, the maintenance of a self- insurance program described in §2161B, or other alternative programs described in §2162, it cannot expect the Medicare program to indemnify it for its failure to do so. Where a provider chooses not to file a claim for losses covered by insurance, the costs incurred by the provider as a result of such losses may not be included in allowable costs. * * * 2160.2 Liability Losses.—Liability damages paid by the provider, either imposed by law or assumed by contract, which should reasonably have been covered by liability insurance, are not allowable. Insurance against a provider’s liability for such payments to others would include, for example, automobile liability insurance; professional liability (malpractice, negligence, etc.); owners, landlord and tenants liability; and workers’ compensation. Any settlement negotiated by the provider or award resulting from a court or jury decision of damages paid by the provider in excess of the limits of the provider’s policy, as well as the reasonable cost of any legal assistance connected with the settlement or award are includable in allowable costs, provided the provider submits evidence to the satisfaction of the intermediary that the insurance coverage carried by the provider at the time of the loss reflected the decision of prudent management. Also, the reasonable cost of insurance protection, as well as any losses incurred because of the application of the customary deductible feature of the policy, are includable in allowable costs. As to whether a cost is allowable, the authority to which AHCA would look is first to the Plan, then to CMS-PUB.15- 1, and then to generally accepted accounting principles (GAAP). As to reimbursement issues, AHCA would look to the same sources in the same order for the answer. The insurance liability limit levels maintained by Avante at Jacksonville and Avante at St. Cloud reflect sound and prudent management practices. Claims that resulted in the settlements of Avante at Jacksonville and Avante at St. Cloud, i.e., wrongful death and/or negligence, are the type of claims covered under the general and professional liability policies carried by Avante at Jacksonville and Avante at St. Cloud. Avante at Jacksonville and Avante at St. Cloud both had a general and professional liability insurance policy in full force and effect at the time the wrongful death and/or negligence claims were made that resulted in the settlement agreements. Neither Avante at Jacksonville nor Avante at St. Cloud filed a claim with their insurance carrier, even though they could have, for the liability losses incurred as a result of the settlements. Avante at Jacksonville and Avante at St. Cloud both chose not to file a claim with their respective insurance carrier for the liability losses incurred as a result of the settlements. AHCA did not look beyond the Plan in making its determination that neither Avante at Jacksonville nor Avante at St. Cloud should be granted an IRR. Wesley Hagler, AHCA’s Regulatory Analyst Supervisor, testified as an expert in Medicaid cost reimbursement. He testified that settlement agreements are a one time cost and are not considered on-going operating costs for purposes of Section IV J.2. of the Plan. Mr. Hagler’s testimony is found to be credible. Mr. Hagler testified that settlement agreements and defense costs are not considered general and professional liability insurance for purposes of Section IV J.3. of the Plan. To the contrary, Stanley William Swindling, Jr., an expert in health care accounting and Medicare and Medicaid reimbursement, testified that general and professional liability insurance costs include premiums, settlements, losses, co-insurance, deductibles, and defense costs. Mr. Swindling’s testimony is found to be more credible than Mr. Hagler’s testimony, and, therefore, a finding of fact is made that general and professional liability insurance costs include premiums, settlements, losses, co-insurance, deductibles, and defense costs.4 Neither Avante at Jacksonville nor Avante at St. Cloud submitted any documentation with their IRRs to indicate a specific law, statute, or rule, either state or federal, with which they were required to comply, resulted in an increase in costs. Neither Avante at Jacksonville nor Avante at St. Cloud experienced an increase in the premiums for the general and professional liability insurance policies. Neither Avante at Jacksonville nor Avante at St. Cloud submitted documentation with its IRRs to indicate that the premiums of its general and professional liability insurance increased. Avante at Jacksonville and Avante at St. Cloud could only meet the $5,000.00 threshold and the one percent increase in total per diem under the Plan, Sections IV J.2. or J.3. by basing its calculations on the settlement costs. Looking to the Plan in conjunction with CMS-PUB.15-1 to determine reimbursement costs, CMS-PUB.15-1 at Section 2160A provides generally that, when a provider chooses not to file a claim for losses covered by insurance, the costs incurred by the provider, as a result of such losses, are not allowable costs; however, Section 2160.2 specifically includes settlement dollars in excess of the limits of the policy as allowable costs, provided the evidence submitted by the provider to the intermediary (AHCA) shows to the satisfaction of the intermediary that the insurance coverage at the time of the loss reflected the decision of prudent management. The policy coverage for Avante at Jacksonville and Avante at St. Cloud set the policy limits for each facility at $10,000.00 for each occurrence. Applying the specific section addressing settlement negotiations, the loss covered by insurance would have been $10,000.00 for each facility and the losses in excess of the policy limits--$340,000.00 for Avante at Jacksonville and $80,000.00 for Avante at St. Cloud—would have been allowable costs.
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 denying the interim rate requests for an increase for Avante at Jacksonville and Avante at St. Cloud. DONE AND ENTERED this 18th day of September 2008, in Tallahassee, Leon County, Florida. 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 18th day of September, 2008. 1/ The corrected case-style.
The Issue The ultimate issue in this case is whether Respondent's proposed Florida Administrative Code Rule 69O-149.022(3), which would incorporate by reference Form OIR-B2-2112, constitutes an invalid exercise of delegated legislative authority. Before that issue may be reached, however, it is necessary to determine whether Petitioners have standing to challenge the proposed rule.
Findings Of Fact The Financial Services Commission ("Commission") is a four-member collegial body consisting of the governor and cabinet. The Office of Insurance Regulation ("Office") is a structural unit of the Commission. Giving rise to this case, the Office initiated rulemaking and made recommendations to the Commission concerning an amendment to rule 69O-149.022, which would incorporate by reference Form OIR-B2-2112, titled "Consumer Notice [Regarding] The Impact of Federal Health Care Reform on Health Plan Costs" ("Form 2112"). Whenever the Commission or the Office engages in rulemaking, the members of the Commission serve as the agency head. The Commission thus has the ultimate responsibility for approving and adopting the proposed rule. CHAIN is a nonprofit corporation which operates solely within the state of Florida. CHAIN is subject to the oversight of a voluntary board of directors. As a health-care advocacy organization, CHAIN is exempt from taxation under section 501(c)(3) of the Internal Revenue Code and derives its income primarily from grants and contributions. CHAIN provides services to low- and moderate-income individuals who lack health insurance coverage or perceive their coverage to be unaffordable or inadequate. CHAIN provides health insurance purchased through Florida's small-group health insurance market to each of its five full-time employees. Greg Mellowe is a full-time employee of CHAIN who receives health insurance coverage through such employment. During the 2013 regular session, the Florida Legislature passed a bill, which the governor approved, enacting section 627.410(9), Florida Statutes. This section requires that insurers provide to policyholders of individual and small-group nongrandfathered plans a notice that describes the estimated impact of the federal Patient Protection and Affordable Care Act ("PPACA")——popularly and more commonly known as Obamacare——on monthly premiums.1/ An insurer that issues a nongrandfathered plan must give this notice one time——when the policy is issued or renewed on or after January 1, 2014——on a form established by rule of the Commission. (A "nongrandfathered" plan is a health insurance plan that must comply with all of Obamacare's requirements. For ease of reference, such plans will be referred to as "compliant plans.") Having been directed to act, the Office commenced rulemaking to establish the form of the notice to be sent to persons insured under compliant, individual and small-group plans, eventually proposing to adopt Form 2112. The Commission approved this form at a hearing on August 6, 2013. Form 2112 fills a single, one-sided page2/ and looks like this: CHAIN will receive the Obamacare notice when it renews its small-group health insurance plan, or purchases a new plan, on or after January 1, 2014.
Findings Of Fact Findings regarding general matters The Respondent, Elnor Darlene Johnson, is currently licensed in the State of Florida as a life insurance agent and as a health insurance agent. At all times pertinent to the issues in this case, the Respondent was licensed in the State of Florida as a health insurance agent and was employed by National States Insurance Company and Transport Life. In order to become a licensed Florida Insurance agent, the Respondent was required to become familiar with the provisions of the Florida Insurance Code and pass an examination given by the Department of Insurance. Respondent is familiar with the provisions of the Florida Insurance Code applicable to health and life insurance agents. Findings regarding Count I (Anna Hajek) The Respondent visited Anna Hajek for the first time on December 6, 1988. Mrs. Hajek had sent in an advertising card to the Respondent's insurance agency requesting information on several health insurance programs. When the Respondent arrived at Mrs. Hajek's home, she asked Mrs. Hajek what other insurance coverage she had in addition to her Medicare coverage. Mrs. Hajek told the Respondent that she did not have any other existing health insurance coverage at that time. During the visit on December 6, 1988, Mrs. Hajek appeared to understand what she and the Respondent were talking about. They discussed the meals Mrs. Hajek was having, Mrs. Hajek's son, and some of Mrs. Hajek's activities. The Respondent was under the impression that Mrs. Hajek was handling her own affairs and that Mrs. Hajek's son was not involved in the management of her affairs. The Respondent and Mrs. Hajek discussed Mrs. Hajek's son and the fact that she wanted to protect her assets (money invested in certificates of deposit) for her son and that she did not want to spend it all on a nursing home. Mrs. Hajek invited the Respondent to return for another visit to have lunch. During the course of the December 6, 1988, visit, the Respondent sold Mrs. Hajek a Medicare Supplement insurance policy. Respondent explained the various benefits and coverages under the policy. Mrs. Hajek appeared to understand the policy. The Respondent did not fill out any "replacement forms" because Mrs. Hajek had told her that she did not have any existing Medicare Supplement insurance. Mrs. Hajek appeared to understand the Respondent's questions regarding whether Mrs. Hajek had any existing coverage. When she left Mrs. Hajek's house, the Respondent left identification, including her telephone number. The insurance policy sold too Mrs. Hajek on December 6, 1988, was a Medicare Supplement insurance policy to be issued by National States Insurance Company, with an intensive care benefit rider, a dental, vision, and hearing care expense rider, an extended care facility confinement rider, and a rider to increase benefits to Supplement Medicare Part B. The initial annual premium was $1,264.00. Mrs. Hajek paid the initial annual premium by delivering a check to the Respondent. National States Insurance Company issued the policy on December 28, 1988. On December 8, 1988, the Respondent made a second visit to Mrs. Hajek's home. At that time Mrs. Hajek told the Respondent she thought she needed nursing home coverage because she did not believe she could rely on her son to help her. The Respondent sold Mrs. Hajek three insurance policies during the course of the December 8, 1988, visit. The first of these policies was an Extended Care Confinement policy with an initial premium in the amount of $121.00 The second was a Limited Medical-Surgical Expense policy with an initial premium in the amount of $668.00. The third was a Nursing Home Policy with a home nurse benefit rider with an initial premium in the amount of $1,496.00. On December 8, 1988, Mrs. Hajek paid the initial premiums on all three policies by delivering a check to the Respondent. National States Insurance Company issued the three policies on December 28, 1988. The Respondent explained all of the coverages and benefits provided under the various policies prior to selling them to Mrs. Hajek, and Mrs. Hajek appeared to understand the policies she was purchasing. During the December 8, 1988, visit with Mrs. Hajek, the Respondent also discussed policies that would provide long-term custodial-type care, which is a different type of coverage than skilled nursing coverage. On December 20, 1988, the Respondent made a third visit to Mrs. Hajek's home. During the course of that visit, the Respondent sold Mrs. Hajek a Long- Term Care policy with an inflation rider to be issued by Transport Life Insurance Company. The initial premium for that policy was $2,380.88. On December 20, 1988, Mrs. Hajek delivered a check in the amount of $2,404.80 in payment of the initial premium and the application fee for the Long-Term Care policy. Transport Life Insurance Company issued a Long-Term Care policy to Mrs. Hajek with an effective date of December 20, 1988. Mrs. Hajek was enrolled in and covered under Humana Gold Plus HMO from at least June 1, 1987, until December 31, 1988. On December 16, 1988, a disenrollment form dated December 6, 1988, and apparently signed by Mrs. Hajek, was received at the offices of the Humana Gold Plus HMO. The disenrollment form was processed and Mrs. Hajek was disenrolled from the HMO effective December 31, 1988, or January 1, 1989. The annual premiums of all of the policies sold to Mrs. Hajek by the Respondent during December of 1988 total $5,869.88. At that time Anna Hajek had an annual income of approximately $7,500.00. 1/ During the time period when the Respondent sold the several insurance policies to Mrs. Hajek, Mrs. Hajek appeared to be mentally competent and in charge of her own affairs. At that time, Mrs. Hajek had her own checking account, was handling her own financial affairs, and was living on her own in a condominium. As of that time, Mrs. Hajek had never been diagnosed as suffering from dementia or any other type of mental disorder that would prevent her from handling her own affairs. 2/ When Mrs. Hajek's son, Frank Hajek, discovered that his mother had purchased several insurance policies, he attempted to contact the Respondent, but she did not return his calls. Ultimately, Frank Hajek wrote to the issuing insurance companies requesting that the policies be cancel led and that the premiums be refunded to his mother. In due course all the policies were cancelled and all of the premiums were refunded. The coverage provided by the policies the Respondent sold to Mrs. Hajek overlaps in several respects. However, all of the coverage appears to be cumulative in the sense that where a specific circumstance is covered by two policies, both policies will pay. 3/ Findings regarding Count II (Sadie & Joseph Grossman) No evidence was received regarding the allegations contained in Count II of the Second Amended Administrative Complaint. 4/ Findings regarding Count III (Paul and Mary Kline) The Respondent visited Paul and Mary Kline at their home in response to a "lead card" the Klines had sent requesting information on long-term nursing home insurance. The Respondent reviewed the Klines' existing coverage and left them information outlining the various benefits and coverages that were available from the companies the Respondent represented. The Klines indicated they were interested in long-term nursing coverage, but did not buy any insurance during the first visit. Mr. Kline later telephoned the Respondent and told her that he and his wife were interested in purchasing the nursing home insurance they had discussed during the first visit. In the meantime, National States had introduced a new policy, the LTC, and the Respondent returned to the Klines' home on January 26, 1989, and showed them the coverages provided by the new policy. The LTC policy provided for skilled, intermediate, and custodial care, and also provided money back to the policyholder if the coverage was not used. During the visit on January 26, 1989, the Respondent solicited, and Paul and Mary Kline signed, applications for long-term nursing care policies to be issued by National States Insurance Company. The premium due on the two policies totaled $2,596.00. On January 26, 1989, Mrs. Kline wrote a premium payment check in the amount of $2,357.60 payable to the order of National States Insurance Company and gave the check to the Respondent. At the time of receiving the check, the Respondent did not notice that the amount on the check was less than the total amount of the premium due on the two policies. On January 26, 1989, the Respondent left receipts and outlines of coverage with the Klines. The receipts were for the full amount of the premium, an amount $238.40 greater than the check received by the Respondent on January 26, 1989. The discrepancy between the receipts and the check were noticed when the Respondent submitted the applications to her agency. Thereupon, the Respondent called Mr. Kline and explained what had happened. The Respondent told Mr. Kline that the company would process the applications, but that the $238.40 shortage would be charged against her account and she hoped he would pay the shortage. Mr. Kline told the Respondent he would pay the difference. The Respondent then wrote a personal check to the insurance company and submitted the Klines' insurance applications for processing. Shortly thereafter Mrs. Kline signed a check payable to the Respondent in the amount of $238.40 and delivered it to the Respondent. At some time subsequent to the purchase of the policies, but before the policies were actually issued, the Klines saw a television show that caused them to believe they had purchased the wrong type of insurance. The Klines tried unsuccessfully to contact the Respondent by telephone. Towards the end of February, the Klines wrote a letter to National States Insurance Company requesting that the policies be cancel led and that their premiums be refunded. Mr. Kline also contacted the Department of Insurance service office about his inability to contact the Respondent. Shortly after that contact, the Respondent called Mr. Kline. The policies were canceled and the Klines received a full refund of the $2,596.00 they had paid in premiums. At the time of the purchase of the policies, the Respondent fully explained the policies to the Klines and the Klines voluntarily purchased same. Mr. Kline was satisfied with the policies on the day he purchased them. Mr. Kline's main complaint was that the Respondent failed to return his telephone calls. Mr. Kline did not believe that the Respondent had lied to him or misrepresented any of the coverages provided by the policies. Findings regarding Count IV (Charles Retty) In November of 1988, Charles Retty contacted the St. Petersburg offices of National States Insurance Company and Diversified Health Services with questions regarding the effect of changes in the Medicare program, and how those changes might affect the need for insurance coverage. At that time, Mr. Retty and his wife were insured under two nursing home policies he had purchased from National States Insurance Company. The Respondent had not sold him either of those policies. As a result of that contact, someone in the management of the insurance company asked the Respondent to call on Mr. Retty. Shortly thereafter, the Respondent visited Mr. Retty, discussed his concerns with him, told him she did not know the answers to all of his questions, and told him she would get back in touch with him with further information. Following the initial meeting between Mr. Retty and the Respondent, Mr. Retty made several unsuccessful efforts to get in touch with the Respondent. Mr. Retty then complained to the Department of Insurance service office regarding his concerns and the failure of the Respondent to get back in touch with him. Shortly after his complaint to the Department of Insurance, the Respondent again visited Mr. Retty, at which time they did not get along very well. Each thought the other somewhat rude and antagonistic. The Respondent was never Mr. Retty's insurance agent. She had never sold him any insurance prior to the visit in November of 1988 and she did not attempt to sell him any insurance during any of her communications with him. The Respondent did not attempt to have Mr. Retty cancel any of his existing insurance or allow any such insurance to lapse. Mr. Retty never gave the Respondent any money. Findings regarding Count V (Minnie Holden) The Respondent has been Minnie Holden's insurance agent since about 1976 or 1977, when the Respondent enrolled Mrs. Holden and her husband in a Medicare Supplement program. When Mr. Holden passed away, the Respondent continued to service Mrs. Holden's policies. In 1986, the Respondent sold Mrs. Holden a Medicare Supplement policy issued by United American. In February of 1987, the Respondent converted that policy to an updated United American Medicare Supplement policy. Mrs. Holden also had a long-term nursing home policy issued by Transport Life. On February 18, 1988, United American Insurance Company received a $990.00 renewal premium for the renewal of Mrs. Holden's Medicare Supplement insurance policy. United American Insurance Company renewed the policy for another year, and it remained in force, paid in full, until its lapse date of February 26, 1989. The Respondent was listed as the agent of record for the renewal of that policy. United American Insurance Company credited the Respondent's debit balance account with a commission in the amount of $138.60 for the February 1988 renewal of Mrs. Holden's Medicare Supplement insurance policy. United American Insurance Company also sent the Respondent a statement of account covering the month of February 1988. The statement of account included the information that Mrs. Holden had renewed her Medicare Supplement insurance policy and that the Respondent's account had been credited with a commission for that renewal. The statement of account also contained information about many other policy holders and contained information about many things other than commissions. 5/ The Respondent visited Mrs. Holden on August 25, 1988, at which time Mrs. Holden told the Respondent that she (Holden) had cancelled her Medicare Supplement policy because she could no longer afford it. Mrs. Holden told the Respondent that she (Holden) had kept her long-term nursing home policy in effect because her daughter was thinking of placing Mrs. Holden in a nursing home. 6/ Respondent advised Mrs. Holden that she really should have Medicare Supplement coverage, and during the August 25, 1988, visit the Respondent solicited and obtained from Mrs. Holden an application for a Medicare Supplement insurance policy to be issued by National States Insurance Company. In filling out the application for the policy, the Respondent answered "No" to Question 4, which inquired, "Is the insurance being applied for intended to replace any accident or sickness insurance, health service or health maintenance contract? " She also answered "No" to Question 5, indicating that no other existing policies were in force. The Respondent believed that her answers to Questions 4 and 5 on the application form were correct on the basis of what Mrs. Holden had said about the cancellation of the prior policy. On August 25, 1988, Mrs. Holden paid for only six months of coverage because she said that was all she could afford. The Respondent told Mrs. Holden that the National State policy was less expensive than the prior United American policy because it provided slightly less coverage. The Respondent did not fill out a "replacement form" when she filled out the application on August 25, 1988, because she thought the United American policy had expired and was no longer in effect. On September 8, 1988, National States Insurance Company issued a Medicare Supplement policy to Mrs. Holden. Mrs. Holden had two Medicare Supplement insurance policies in effect from September 8, 1988, until February 26, 1989. Findings regarding Count VI (Louella Riley) The Petitioner did not offer any evidence regarding the allegations contained in Count VI of the Second Amended Administrative Complaint. Findings regarding Count VII (Violation of probation) In 1986, the Florida Department of Insurance conducted an investigation Into the activities of the Respondent as an insurance agent in this state. As a result of that investigation, the Department filed Investigation Report No. 86- 158-IA-TP, alleging violation of the replacement laws relating to the solicitation and sale of Medicare Supplement insurance. On August 28, 1987, the Respondent entered into a Settlement Stipulation For Consent Order with the Department, Case No. 87-L-321DF, whereby she was placed on departmental probation for a period of one year, effective upon the date of signing of the Consent Order in that case. A condition of that probation was that the Respondent strictly adhere to all provisions of the Florida Insurance Code and of the rules of the Department of Insurance. The settlement stipulation also provided that the Department of Insurance would initiate proceedings to revoke all licensure and eligibility for licensure of the Respondent if she violated provisions of the Florida Insurance Code or rules of the Department of Insurance during her probationary period. On September 9, 1987, a Consent Order was issued by the Department of Insurance in Case No. 87-L-321DF, which incorporated all terms and conditions of the Settlement Stipulation For Consent Order. Accordingly, the Respondent was on departmental probation from September 9, 1987, through September 8, 1988.
Recommendation For all of the foregoing reasons, it is recommended that the Department of Insurance issue a Final Order in this case dismissing all charges against the Respondent in this case. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 5th day of November 1990. MICHAEL M. PARRISH Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 5th day of November 1990.
