The Issue The issues are whether Petitioner is entitled to repayment of Medicaid reimbursements paid to Respondent, pursuant to section 409.913(11), Florida Statutes; and, if so, the amount of the overpayment to be repaid; the amount of any fine to be imposed against Respondent, pursuant to section 409.913(15)- (17), Florida Statutes; and the amount of any investigative, legal, and expert witness costs to be assessed against Respondent, pursuant to section 409.913(23)(a), Florida Statutes.
Findings Of Fact Introduction Respondent operates a large group medical practice with a focus upon psychiatric services. Although Respondent serves patients in varied locations, including its offices and patients' nursing homes, all of the recipients in this case were in hospitals when Respondent's physicians rendered the services for which Respondent obtained reimbursement. The audit in question examined all of the claims paid on account of 30 randomly selected recipients to whom Respondent provided services from March 1, 2008, through February 28, 2010. Petitioner duly issued a preliminary audit report and received feedback from Respondent. On July 31, 2012, Petitioner issued the FAR. As distinguished from its challenge to the statistical estimation process, Respondent has not challenged the procedures followed in the preparation and issuance of the FAR, so the Administrative Law Judge infers that it is in compliance with all applicable law. The overpayments that Petitioner found in the 30-recipient sample arise from three sources. Petitioner denied 83 reimbursement claims for a lack of medical necessity and two reimbursement claims for double billing.3/ Petitioner "adjusted" (i.e., reduced) 16 reimbursement claims for upcoding the services provided to recipients. Petitioner's expert witnesses are Dr. Rahul Mehra, who is Board certified in psychiatry, and Dr. Nanette Hoffman, who is Board certified in internal medicine and geriatrics. Respondent's expert witnesses are Dr. Scott Segal, who is the founder of Respondent and Board-certified in psychiatry, and Dr. Tanver Sobhan, who is employed by Respondent and Board- certified in psychiatry. CPT Codes Pursuant to the Florida Medicaid Physician Services, Coverage, and Limitations Handbook in effect during the audit period (Physician Handbook), the coding of claims for Medicaid reimbursement is governed by the Current Procedural Terminology® (CPT). Physician Handbook at 3-1. References to the CPT will be to the 2009 edition.4/ Hospital and office visits are covered in the CPT's "Evaluation and Management Service Guidelines." The CPT identifies seven components of Evaluation and Management (E/M) services: 1) history, 2) examination, 3) medical decisionmaking, 4) counseling, 5) coordination of care, 6) nature of presenting problem, and 7) time. CPT at 3. The first three components are the "key" factors in selecting the correct level of service for an E/M service. The next three components are "contributory" factors. Id.5/ The "extent of the history is dependent upon clinical judgment and on the nature of the presenting problem(s)." Id. at 7. The extent of history may be characterized by any of four levels of service: Problem focused: Chief complaint; brief history of present illness or problem. Expanded problem focused: Chief complaint; brief history of present illness; problem pertinent system review. Detailed: Chief complaint; extended history of present illness, problem pertinent system review extended to include a review of a limited number of additional systems; pertinent past, family, and/or social history directly related to the patient's problems. Comprehensive: Chief complaint; extended history of present illness; review of systems that is directly related to the problem(s) identified in the history of the present illness plus a review of all additional body systems; complete past, family, and social history. Id. The "extent of examination performed is dependent on clinical judgment and on the nature of the present problem(s)." Id. The extent of examination may be characterized by any of four levels of service: Problem focused: A limited examination of the affected body area or organ system. Expanded problem focused: A limited examination of the affected body area or organ system and other symptomatic or related organ system(s). Detailed: An extended examination of the affected body areas(s) and other symptomatic or related organ system(s). Comprehensive: A general multisystem examination or a complete examination of a single organ system. For the purpose of these CPT definitions, the following body areas are recognized: head, including the face; neck; chest, including breasts and axilla; abdomen; genitalia, groin, [and] buttocks; back; [and] each extremity. For purposes of these CPT definitions, the following organ systems are recognized: eyes; ears, nose, mouth, and throat; cardiovascular; respiratory; gastrointestinal; genitourinary; musculoskeletal; skin; neurologic; psychiatric; [and] hematologic/lymphatic/immunologic." Id. "Medical decision making refers to the complexity of establishing a diagnosis and/or selecting a management option as measured by: The number of possible diagnoses and/or the number of management problems that must be considered. The amount and/or complexity of medical records, diagnostic tests, and/or other information that must be obtained, reviewed, and analyzed. The risk of significant complications, morbidity, and/or mortality, as well as comorbidities, associated with the patient's presenting problem(s), and/or the possible management options. Id. Four types of medical decision making are recognized: straightforward, low complexity, moderate complexity, and high complexity. To qualify for a given type of decision making, two of the three elements in Table 2 [see below] must be met or exceeded. Comorbidities/underlying diseases, in and of themselves, are not considered in selecting [an E/M level of service] unless their presence significantly increases the complexity of the medical decision making. Table 2 governs determinations of the complexity of medical decisionmaking and provides: Number of Amount and/or Risk of Compli- Type of Diagnoses Complexity of cations and/or Decision Or Manage- ment Options Data to be Reviewed Morbidity or Mortality Making minimal minimal or none minimal straight- forward limited limited low low complexity multiple moderate moderate moderate complexity extensive extensive high high complexity Id. at 8. As for time in a hospital setting, the CPT states: [U]nit/floor time . . . includes the time that the physician is present on the patient's hospital unit and at the bedside rendering services for that patient. This includes the time in which the physician establishes and/or reviews the patient's chart, examines the patient, writes notes, and communicates with other professionals and the patient's family. In the hospital, pre- and post-time includes time spent off the patient's floor performing such tasks as reviewing pathology and radiology findings in another part of the hospital. This pre- and post-visit time is not included in the time component described in these codes. However, the pre- and post- work performed during the time spent off the floor or unit was included in calculating the total work of typical services in physician surveys. Thus, the unit/floor time associated with the services described by any code is a valid proxy for the total work done before, during, and after the visit. Id. at 5. CPT ##99231, 99232, and 99233 cover "subsequent hospital care," which includes "reviewing the medical record and reviewing the results of diagnostic studies and changes in the patient's status (i.e., changes in history, physical condition and response to management) since the last assessment by the physician." CPT #99231 is for subsequent hospital care, per day, of a patient who requires at least two of three of the following components: a problem focused interval history, a problem focused examination, and medical decisionmaking that is straightforward or of low complexity. The patient is usually "stable, recovering or improving," and the physician typically spends 15 minutes at the bedside and on the hospital floor or unit. A psychiatric example of CPT #99231 is: Subsequent hospital visit for a 14-year-old female in middle phase of inpatient treatment, who is now behaviorally stable and making satisfactory progress in treatment. Id. at 503. CPT #99232 is for subsequent hospital care, per day, of a patient who requires at least two of three of the following components: an expanded problem focused interval history, an expanded problem focused examination, and medical decisionmaking of moderate complexity. The patient is usually "responding inadequately to therapy or has developed a minor complication," and the physician typically spends 25 minutes at the bedside and on the hospital floor or unit. CPT #99233 is for subsequent hospital care, per day, of a patient who requires at least two of three of the following components: a detailed interval history, a detailed examination, and medical decisionmaking of high complexity. The patient is usually "unstable or has developed a significant complication or a significant new problem," and the physician typically spends 35 minutes at the bedside and on the hospital floor or unit. Psychiatric examples of CPT #99233 are: Follow-up hospital visit for a teenage female who continues to experience severely disruptive, violent and life-threatening symptoms in a complicated multi-system illness. Family/social circumstances also a contributing factor. Subsequent hospital visit for an adolescent patient who is violent, unsafe, and noncompliant, with multiple expectations for participation in treatment plan and behavior on the treatment unit. Subsequent hospital visit for an 18-year-old male being treated for presumed PCP psychosis. Patient is still moderately symptomatic with auditory hallucinations and is insisting on signing out against medical advice. Id. at 505. CPT ##99221, 99222, and 99222 apply to ascending levels of initial hospital care, meaning that the initial day of inpatient care is billed under one of these codes and subsequent days of inpatient care are billed under CPT ##99231-99233. CPT #99221 requires a detailed or comprehensive history, a detailed or comprehensive examination, and medical decisionmaking of low complexity or that is straightforward. CPT #99222 requires a comprehensive history, a comprehensive examination, and medical decisionmaking of moderate complexity. CPT #99223 requires a comprehensive history, a comprehensive examination, and medical decisionmaking of high complexity. CPT ##99238 and 99239 apply to hospital discharge services. CPT #99238 applies if, on the day of hospital discharge, the physician spends 30 minutes or less with the patient, performing such tasks as a final examination, issuance of discharge instructions, and preparation of discharge records, prescriptions and referral forms. If the physician spends more than 30 minutes on these tasks, CPT #99239 applies. Medical Necessity of Psychiatric Services In this case, all of the denials for a lack of medical necessity pertain to psychiatric services, and all of the reductions for upcoding pertain to medical services that are not psychiatric in nature. (Although psychiatry is a branch of medicine, this recommended order generally6/ will refer to "medical" services to mean nonpsychiatric medical services.) Not raising difficult issues of fact or law, the upcoding issues are straightforward or, at most, of low complexity; Petitioner has prevailed on all but one upcoding claim, and it conceded this claim at the hearing. By contrast, many of the medical necessity issues, which are relatively consequential in estimating the total overpayment,7/ are highly complex, raising difficult issues of fact and law. Respondent has prevailed on most of these claims, in several instances, due to recurring shortcomings in Petitioner's evidence. In general, the expert witnesses offering psychiatric testimony were all highly qualified. Respondent's experts are interested in the outcome of the case. On the other hand, Dr. Mehra's experience over the past three years in treating psychiatric patients has not included inpatient care. By contrast, Dr. Sobhan and Dr. Segal have considerable experience in providing inpatient psychiatric services. Moreover, Respondent's experts, particularly Dr. Segal, have considerable knowledge and experience as to the entire range of local, regional, and state settings for the psychiatric treatment of patients, particularly those sharing the demographic characteristics of the recipients involved in this case. Dr. Mehra's experience does not appear to approach the experience of Drs. Segal and Sobhan in this important respect. Of course, the knowledge and experience of Drs. Segal and Sobhan extend to assessing the suitability of particular patients for particular settings. In addressing medical necessity, all of the psychiatric experts understood that, as noted in the Conclusions of Law, a billed service must be a generally accepted preventative, curative, or palliative service in the diagnosis or treatment of a recipient. All of the psychiatric experts understood that, to meet the definition of medical necessity, a billed service must be needed, not in excess of the recipient's needs, and the least costly, effective service among services that are available statewide. This Recommended Order will refer to services that are provided when no services are needed as Inappropriate Services and services that are provided in excess of the services that are needed as Excessive Services. However, Inappropriate Services and Excessive Services play a minor role in this case. As noted in the Conclusions of Law, the special provision of the rule applying only to inpatient services provides that billed inpatient services are not medically necessary if they could have been appropriately and effectively furnished less expensively on an outpatient basis or in an inpatient facility of a different type. This Recommended Order will refer to services that could have been furnished less expensively in another setting as Costlier-Setting Services. Almost all of the medical-necessity determinations in this case turn on whether certain psychiatric services are Costlier- Setting Services. Unfortunately, the expert psychiatric testimony focused on whether certain psychiatric services could have been appropriately and effectively furnished in a lower level of care--to the exclusion of any consideration of the cost of these services in another setting. As discussed in the Conclusions of Law, the burden of going forward with the evidence as to this aspect of medical necessity is on Petitioner, so that the shortcomings of Dr. Mehra's testimony were more consequential than the shortcomings of Drs. Segal and Sobhan's testimony. Exacerbating the shortcomings of the psychiatric testimony as to relative costs, much of the psychiatric level- of-care testimony was vague. Dr. Mehra identified the descending "levels of care" in psychiatric medicine: in order, starting with the highest level of care, these settings are inpatient, residential, partial hospitalization, and outpatient. Dr. Mehra identified specific circumstances that warranted the highest level of care, meaning inpatient psychiatric services.8/ But Dr. Mehra never specified for any recipient what lesser level of care would have been safe at any particular time. Ms. Eddleman identified a number of local behavioral programs--all available in South Florida--with a level of care less than hospitalization or partial hospitalization, but greater than treatment in an office or private residence. Persons at risk of hospitalization may obtain behavioral health day treatment services, which are more intensive than regular outpatient services and bundle psychosocial rehabilitation services to help build skills with individual and family therapy sessions. Persons may obtain mental health targeted case management services, automatically for 30 days after hospital discharge, and, without regard to hospitalization, if the person suffers from a severe and persistent mental disorder. The case manager helps the person obtain services, such as housing and the community behavior services described immediately above, to help stabilize psychiatric symptoms. Separate medication administration programs are also available to try to help persons with mental disorders obtain and take their medications. Ms. Eddleman provided very useful level-of-care testimony. But its utility in this case is limited by its timing. Petitioner obtained the testimony after Dr. Mehra had testified. If the testimony had been available earlier, Dr. Mehra might have been able to add much-needed detail to his level-of-care testimony. Regardless of the timing of Ms. Eddleman's testimony, no evidence links a particular date of inpatient services to a particular community-based behavioral service, so as to support a determination that a lower level of care was suitable on that date. Of course, as a layperson, Ms. Eddleman could not have provided this link. But, again, the larger problem was that the level-of- care testimony provided by Dr. Mehra and Ms. Eddleman was not supplemented by any testimony about relative costs. While requiring that the psychiatric services be appropriate so as to ensure patient safety, the subject audit is a cost audit, not a quality-of-care audit. The only explanation for why the three psychiatrists concerned themselves exclusively with level-of- care issues in addressing Costlier-Setting Services is that they assumed lower levels of care would mean lower costs. As shown below, though, the reimbursement rates do not bear a direct relationship to the level of care of the setting in which the services are provided.9/ A quick look at the CPT's treatment of E/M services reveals an obvious flaw in Dr. Mehra's failure to account for actual costs in his level-of-care testimony: the first and third levels of care in Dr. Mehra's list are combined into a single CPT code for E/M services, as noted above. CPT at 12. So, even if a recipient could have been treated safely on a partial-hospitalization basis, this would not deprive the inpatient services of medical necessity, as Costlier-Setting Services, because the same reimbursement rate applies to services in both of these settings. The larger problem is that the provision of a service in a hospital setting does not command the highest reimbursement rate. In fact, an inpatient service is invariably cheaper than the same level of service provided in the patient's boarding home or private home and is often cheaper than the same level of service provided in a patient's skilled nursing facility or a physician's office. Petitioner Exhibit #17, which contains the reimbursement rates for various CPT codes, reveals the relative costs. In the following table, which is for 2009,10/ "PF" means problem focused, "Ex" means expanded problem focused, "Det" means detailed, "Comp" means comprehensive, "Straight" means straightforward, and "Mod" means moderate. The first reference to any of these descriptors is to the history or interval history, the second reference is to the examination, and the third reference is to the complexity of the decisionmaking. The first numerical reference is to the CPT and the second is to the 2009 reimbursement rate. For each CPT listed below, only two of three criteria must be met. SUBSEQUENT HOSPITAL CARE PF/PF/Straight or Low 99231 $20.36 Ex/Ex/Mod 99232 $36.60 Det/Det/High 99233 $52.45 OFFICE OR OTHER OUTPATIENT CARE: ESTABLISHED PATIENT PF/PF/Straight 99212 $21.84 Ex/Ex/Low 99213 $26.61 Det/Det/Mod 99214 $41.46 Comp/Comp/High 99215 $60.27 NURSING FACILITY SERVICES: SUBSEQUENT NURSING FACILITY CARE PF/PF/Straight 99307 $21.72 Ex/Ex/Low 99308 $32.89 Det/Det/Mod 99309 $43.64 Comp/Comp/High 99310 $64.98 BOARDING HOME: ESTABLISHED PATIENT PF/PF/Straight 99334 $30.33 Ex/Ex/Low 99335 $46.77 Det/Det/Mod 99336 $65.58 Comp/Comp/High 99337 $93.75 HOME SERVICES: ESTABLISHED PATIENT PF/PF/Straight 99347 $28.77 Ex/Ex/Low 99348 $42.86 Det/Det/Mod 99349 $62.25 Comp/Comp/High 99350 $86.33 It is more difficult to compare the cost of inpatient services to the cost of services in an office or skilled nursing facility. But, in the context of this case, as found below, many of the psychiatric inpatient services represented a problem focused history, extended problem focused or detailed examination, and decisionmaking that is straightforward or of low complexity. These components earn a CPT #99231 and a reimbursement of $20.36 in a hospital, a CPT #99308 and a reimbursement of $32.89 in a skilled nursing facility, and a CPT #99213 and a reimbursement of $26.61 in an office or other outpatient setting. Thus, for this very common aggregation of components, the services provided to a recipient in a hospital setting were cheaper than the same services provided to a recipient in a skilled nursing facility, office, or other outpatient setting.11/ Petitioner's proof of Costlier-Setting Services encountered other problems, besides vagueness as to alternative suitable settings and an absence of relative cost data. Neither Petitioner nor Dr. Mehra ever dealt with the issues that, especially given the absence of direct admits in this case, Respondent's physicians had to treat these patients where they found them--in a hospital--and Petitioner has not sought to recover the reimbursements that it paid to the hospitals for the stays at issue in this case. Recipient 1 illustrates these problems. Recipient 1 primarily required detoxification with some psychiatric support during the process. To the extent that detoxification was a medical process, Recipient 1's medical needs required hospitalization. If, somehow, his psychiatric needs could be analyzed in isolation from his medical needs, they perhaps could have been addressed in another setting, and perhaps the reimbursement rate in the other setting might have been lower. But these services could not be isolated from the medical, detoxification process through which nonpsychiatric physicians were guiding him. By contrast, Recipient 2 also required detoxification, but her psychiatric issues were more prominent than Recipient 1's. Recipient 2's abuse of drugs injured herself and her fetus, so her psychiatric needs were necessarily more urgent and her case perhaps more complicated psychiatrically. Compared to Recipient 1, then, the high level of care provided by the hospital setting was clearly appropriate, even considering Recipient 2's psychiatric needs in isolation from her medical needs. Rather than repeat the foregoing findings of Costlier- Setting Services in the following discussions of each recipient, they are incorporated by reference and highlighted or differentiated, as needed, in discussions of specific recipients. Recipients Introduction 39. At issue are Recipients 1, 2, 11, 12, 23, 26, 27, 29, and 30. Based on Attachment C, the parties are litigating five denied claims as to Recipient 1; 16 denied claims as to Recipient 2, one denied claim and seven reduced claims as to Recipient 11; five denied claims and one reduced claim as to Recipient 12; 19 denied claims and seven reduced claims as to Recipient 23; six denied claims as to Recipient 26; five denied claims as to Recipient 27; four denied claims as to Recipient 29; and 24 denied claims and one reduced claim as to Recipient The two denied claims for double billing pertain to Recipient 12. Concessions of the parties first offered during the hearing will be noted in the discussion of the appropriate recipient. Recipient 1 For Recipient 1, a 34-year-old male diagnosed with depressive disorder, only one hospitalization is at issue. From December 2-7, 2009, Recipient 1 was hospitalized at Memorial Regional Hospital for detoxification to treat an opiate dependency. Recipient used heroin on the day prior to the admission, averaged three intravenous injections daily, and worried that he would continue to take heroin if he were not hospitalized. At issue are the following billed CPT codes: December 2: #99223 December 3: #99232 December 4: #99232 December 5: #99232 December 7: #99232 Petitioner denied these psychiatric claims for a lack of medical necessity. Misreading the chart, Dr. Segal testified that Recipient 1 had threatened to kill himself. As pointed out by Dr. Mehra, the medical records clearly disclose that Recipient 1 denied any thoughts of suicide--or, for that matter, homicide. Dr. Segal misunderstood a reported statement of Recipient 1 that he was going to kill himself--more or less inadvertently--through the continued use of drugs. Recipient 1 had been using heroin since he was 26 years old. He had previously completed treatment programs and enjoyed three years' sobriety. On admission, Recipient 1 was already suffering from muscle aches, hot and cold sweats, back pain, diarrhea, and nausea. The medical records state that, on admission, Recipient 1 "was experiencing an exacerbation of psychiatric symptoms," although these symptoms are not detailed in the records. The medical records do not describe in much detail the role of psychiatric services during this detoxification process. At one point during Recipient 1's six-day hospitalization, the medical records state: "The patient reported a reduction of psychiatric symptoms on the current medication regime " But the records do not identify the symptoms or the inpatient psychiatric services--apart from a mention of individual therapy--nor do the records explain how the medications or services may have contributed to a reduction in psychiatric symptoms. In general, the psychiatric notes are vague and provide little, if any, insight into any psychiatric symptoms, diagnoses, or treatments. Dr. Mehra testified that Recipient 1 underwent what was essentially an uncomplicated detoxification process. In hindsight, Recipient 1's detoxification was uncomplicated, but, of course, no one knew in advance that it would be. The possibility of difficulties during detoxification is suggested by the prescription for an anti-seizure medication, should the need have arisen. Dr. Mehra's implication that the hospital setting for this detoxification was an excessive level of care fails to address the medical needs of the recipient during this relatively brief detoxification process. Dr. Mehra contended for a lower level of care based on the absence of any threat of harm to self or others and the absence of any indication of a recent history of treatment failure. Failing to address the issue mentioned in the preceding paragraph, Dr. Mehra never discussed why, under the circumstances, the absence of these threats militates in favor of nonhospitalization, rather than a relatively brief hospitalization, especially as a brief hospitalization appears to have been necessitated by Recipient 1's medical needs in association with his detoxification. Dr. Mehra also failed to identify a lower level-of- care facility at which Recipient 1 could have been safely treated. Recipient 1's past failure to maintain sobriety after three years without heroin use and his well-founded fear that he would resume heroin use if treated on an outpatient basis precluded treatment in a lower level-of-care setting. Dr. Mehra never suggested that the billed psychiatric services were Inappropriate Services or Excessive Services, and Respondent has proved that they were not, notwithstanding the shortcomings in the medical records. Dr. Mehra suggested that the psychiatric services were Costlier-Setting Services, but Petitioner has failed to prove that they were. Petitioner therefore improperly denied these five psychiatric claims for a lack of medical necessity. Recipient 2 For Recipient 2, a 32-year-old female diagnosed as 21 weeks gravid and with depressive disorder, only one hospitalization is at issue. From December 1-18, 2008, Recipient 2 was hospitalized at Plantation General Hospital for detoxification from alcohol abuse, including binge drinking. Actually admitted on November 29, 2008, to the Broward Addiction Recovery Center within the hospital, Respondent's physician initially diagnosed Recipient 2 with Antepartum Polysubstance Dependence.12/ At issue are the following billed CPT codes: December 2: #99232 December 3: #99232 December 4: #99232 December 5: #99232 December 6: #99231 December 7: #99231 December 8: #99232 December 9: #99232 December 10: #99232 December 11: #99232 December 12: #99232 December 13: #99231 December 14: #99231 December 15: #99232 December 16: #99232 December 17: #99232 Petitioner denied these billed psychiatric claims for a lack of medical necessity. Recipient 2 was homeless. She had been working as a prostitute and, at one point during her hospitalization, reported that she had become pregnant while having sex with a customer. Recipient 2 had been treated briefly in 2006, but had relapsed immediately and had enjoyed only one, six-month period of sobriety since the inception of her alcohol addiction in 2001. Recipient 2 had no family support. Her father had been an alcoholic, and her mother had been a crack addict, so her grandmother had raised her from the age of six months. Recipient 2 claimed to have support from her boyfriend, but there is doubt that the boyfriend, with whom Recipient 2 appears to have had no contract during her hospitalization, was much more than Recipient 2's pimp. Dr. Sobhan treated Recipient 2 at the hospital and prepared for her a detailed treatment plan. Dr. Sobhan found that Recipient 2 had "very weak ego strength" and was in a "very fragile mental state." She maintained unrealistic expectations of others and used the defenses of displacement and drugs to deal with her feelings. She had minimal insight and often used inappropriate laughter as a defense. Dr. Sobhan found that Recipient 2's life "has been totally destroyed by her drug addiction," and she "has lost all volitional capacity to abstain from drugs or deal effectively with life on life's terms." Her drug use "has persisted and steadily worsened despite negative consequences in her life." At admission, Dr. Sobhan determined: "A lower level of care at this time would place the patient at risk for relapse, harm to herself and harm to the fetus." Recipient 2 required "stabilization of her mental health," and "[i]npatient services will be needed to prevent regression and restore patient to a state of competence where she can move on to a lower level of care in 21 days but still remain in a residential setting." Dr. Sobhan's treatment plan was for Recipient 2 to work on her substance abuse problems by attending individual and group therapy, meet with a psychiatrist, increase coping skills to prevent relapse and identify triggers to relapse, and begin a 12-step program to rid herself of her addiction. Intra-hospitalization progress notes document the therapeutic work involved in preparing Recipient 2 for a lower level of care. Such work included helping Recipient 2 forgive herself for past failings, find appropriate leisure and recreational activities, develop relaxation techniques (such as meditation and guided imagery), and prepare for the delivery of her baby. Recipient 2 was referred to the hospital by personnel at Gratitude House, which is a residential and day facility for treating women with drug or alcohol addictions. It is not clear whether she was in the residential or day program at Gratitude House immediately prior to her hospitalization, but Recipient 2 was transferred to the residential program at Gratitude House upon discharge from the hospital. The pregnancy addiction program that served Recipient 2 at Plantation General Hospital was once located at Adventura Hospital--under Dr. Segal's administration. At that time, the program called for 45 days of inpatient treatment of the pregnant addict, and Medicaid reimbursed this inpatient treatment. Medicaid reduced its reimbursements to 28 days of inpatient treatment in such a program a few years ago, at which time the program relocated to Plantation General. At all times, Medicaid-required reimbursement conditions provided that a physician must see the recipient daily in the hospital. Dr. Segal testified that the 21-day program to which Recipient 2 was admitted at Plantation General was the only program available for treating pregnant patients with active alcohol or drug addictions. The twin purposes of the program are to provide the pregnant inpatient with medications to assist with detoxification and the psychiatric therapy required to help her conquer her addiction. Dr. Mehra countered, though, that Recipient 2 had not used cocaine since September 2008 and marijuana since October 2008. The medical records also disclose that Recipient 2 reported that she last used Xanax in September 2008. Nothing in the record suggests Inappropriate Services or Excessive Services. Petitioner's theory of a lack of medical necessity rests on Costlier-Setting Services, which is rejected for the above-discussed reasons. From a level-of-care perspective, Recipient 2's hospitalization was bookended by treatment at Gratitude House, and it may be inferred that Gratitude House staff had agreed with the need for an interim hospitalization. Certainly, Respondent's psychiatrists had made this determination. In contrast, Dr. Mehra appears to have had no idea as to what alternative settings would have been appropriate for Recipient 2 and her fetus--let alone the costs of psychiatric services provided in such settings. Petitioner therefore improperly denied these 16 psychiatric claims for a lack of medical necessity. Recipient 11 For Recipient 11, a 26-year-old male diagnosed with paranoid schizophrenia, only one hospitalization is at issue. From February 17-28, 2010, Recipient 11 was hospitalized at Broward General Medical Center to treat a recent exacerbation of his psychiatric illness. Recipient 11 was brought to the hospital emergency room by someone from his assisted living facility, where he had been residing for only one day and was refusing to take his psychotropic medication. Recipient 11 presented at the hospital with delusional thoughts and anxiety, claiming that his brain was in convulsion, and displaying a bizarre, though cooperative, demeanor. Due to disordered thought, Recipient 11 was unable to give an accurate history on admission. Recipient 11 received a second diagnosis on the second day of his hospitalization: acute hepatitis C. Recipient 11 had undergone a half dozen previous psychiatric admissions. The medical records for the subject hospitalization record Recipient 11's past medical history as follows: "According to the records, positive for human immunodeficiency virus and hepatitis C, but the recent tests in 2005 was [sic] not confirmatory." The axis II diagnosis on February 17 was thus: "History of questionable human immunodeficiency virus and hepatitis C. We will repeat laboratories in the morning." On February 18, a physician's report notes that Recipient 11's "laboratory data is normal." From February 18 through discharge, then, Recipient 11 did not bear a diagnosis of either HIV or hepatitis C. At issue are the following billed CPT codes: February 18: #99232 February 21: #99232 February 22: #99232 February 23: #99232 February 24: #99232 February 25: #99232 February 26: #99232 February 28: #99232 Petitioner denied the February 18 psychiatric claim for a lack of medical necessity and downcoded the remainder of the claims, which involve medical services, from CPT #99232 to #99231. At the hearing, Dr. Mehra conceded the medical necessity of the psychiatric services covered by the February 18 billing. (Tr. 284) Petitioner therefore improperly denied this psychiatric claim for a lack of medical necessity. Dr. Hoffman addressed the downcodings. By not later than February 22, any questions about HIV and hepatitis C had been answered in the negative. Dr. Segal testified that Recipient 11's remaining diagnoses were weakness, obesity, and headache. Dr. Segal admitted that the headache resolved during the course of the hospitalization. The February 20 progress note adds that the weakness, too, had at least become stable by that date. The February 21 progress note states that Recipient 11 "feels better physically" and lists as diagnoses only mild obesity and improving weakness. Respondent's upcoding of these medical claims is obvious. As Dr. Hoffman testified, from February 22 through February 28, the medical decisionmaking was straightforward, and the histories were problem focused with no more than a mention of a chief complaint. Dr. Hoffman admitted that the examinations were more intense than problem focused, but she correctly noted that the CPT #99231 requires only that two criteria be met. Here, the history and medical decisionmaking satisfied CPT #99231, not a higher code. Petitioner therefore properly downcoded from CPT #99232 to #99231 the medical claims on February 21-26 and 28. Recipient 12 For Recipient 12, a 19-year-old male diagnosed with bipolar disorder, only one hospitalization is at issue. From May 23-28, 2009, Recipient 12 was hospitalized at Florida Medical Center for treatment of an exacerbation of bipolar symptoms, including manic behaviors, disorganized thinking, loose association, and poor judgment. Respondent had recently moved to South Florida from Tennessee and had not taken his psychotropic medications for one month. At issue are the following billed CPT codes: May 23: #99222 May 24: #99232 May 24: #99232 May 24: #99232 May 26: #99232 May 28: #99232 Petitioner denied the May 23 claim, one of the May 24 claims, and the May 26 claim for a lack of medical necessity; all of these were for psychiatric services. Petitioner denied two of the May 24 claims for double billing. Petitioner downcoded the May 28 medical claim from CPT #99232 to #99231. At the hearing, the parties conceded as to all dates of service except for the double billings on May 24. Respondent's counsel conceded the downcoding of the May 28 claim. (Tr. 488) Dr. Mehra conceded that the psychiatric services on May 23 were medically necessary. (Tr. 232) After hearing a detailed explanation of the psychiatric services, Dr. Mehra conceded that the services on all three dates--May 23, 24, and 26--were medically necessary. (Tr. 240) Petitioner thus improperly denied these psychiatric claims. These concessions leave the only issue for disposition as to Respondent 12 the so-called double billings on May 24. Dr. Segal conceded that Respondent received these double reimbursements. It is equally evident that Respondent did not repay these over-reimbursements to Petitioner prior to their discovery during the audit. These are the crucial facts. Dr. Segal's argument against the extension of these double reimbursements on the ground that Respondent did not double bill them is unpersuasive. Regardless of whether these duplicated items represent double billings and reimbursements or merely double reimbursements, the point is that, prior to their discovery during the audit, Respondent failed voluntarily to repay these unearned sums. There is thus no reason not to include these sampled overpayments in the estimation process by which Petitioner determines the total overpayment. Recipient 23 For Recipient 23, a 57-year-old male diagnosed with depression, six hospitalizations are at issue. From September 8-14, December 12-18, and December 21-24, 2009, and January 10-12, February 6-8, and February 22-23, 2010, Recipient 23 was hospitalized at several facilities to treat his psychiatric illness. Recipient 23 has a history of use of cocaine and marijuana and abuse of alcohol. Not long before the first hospitalization, Recipient 23 had been released from an eight- year term in prison for robbery. At issue are the following billed CPT codes: September 9: #99232 September 10: #99232 September 11: #99232 September 12: #99232 September 13: #99232 September 14: #99238 December 12: #99222 December 12: #99254 December 13: #99232 December 14: #99232 December 14: #99232 December 15: #99232 December 15: #99232 December 16: #99232 December 16: #99222 December 17: #99232 December 17: #99232 December 18: #99238 December 18: #99232 December 23: #99232 December 23: #99232 December 24: #99238 December 24: #99232 January 12: #99238 February 6: #99223 February 7: #99223 February 8: #99233 Petitioner denied all of the claims for a lack of medical necessity except for the downcodings from CPT #99232 to #99231 on December 14-18 and 23-24. The psychiatric denials will be addressed before the medical downcodings. On September 8, Recipient 23 was transported to the hospital from jail by law enforcement officers. He had been exhibiting suicidal and homicidal tendencies while in jail. He presented with hyperverbal speech, bizarre appearance, withdrawn and uncooperative behavior, irritable mood, persecutory and paranoid delusions, auditory hallucinations, and poor judgment. Recipient 23 required 24-hour supervision. His history included the suicide of his mother when he was a young child. Dr. Mehra testified that the progress notes for this hospitalization were vague--failing, for instance, to specify the nature of the delusions. Dr. Mehra faulted the medical records for failing to detail how Recipient 23's psychiatric symptoms were impacting him. For instance, did Recipient 23 require restraints or as-needed administration of antipsychotics? In terms of Recipient 23's suicidal tendencies, Dr. Mehra noted a lack of a plan for suicide. Dr. Mehra also raised the question of whether the patient merely wanted to escape a nonpreferred setting--jail--by admittance to the hospital. Dr. Segal testified that Recipient 23 had been Baker Acted recently on one or two other occasions preceding the September 8 hospitalization. His treatment plan included, among other things, increasing the dosage of Risperdal that he had been taking. During this brief hospitalization of no more than six days, the psychiatrist also increased the patient's Seroquel to control psychiatric symptoms. As soon as Recipient 23 did not seem suicidal, Respondent had him discharged to Second Chance Recovery, a halfway house representing a lower level of care, where he would be followed by another of Respondent's psychiatrists. Dr. Sobhan admitted that, with this kind of psychiatric patient, it is necessary to discharge him as soon as he says that he is doing better and no longer represents a risk of suicide or homicide. Just as Respondent's psychiatrists are concerned about a patient's acting out on suicidal or homicidal ideation, they are also concerned that unnecessarily long hospitalizations will make the patient dependent on the hospital. It is difficult to characterize Dr. Mehra's medical- necessity concerns. They seem equally applicable to Inappropriate Services, Excessive Services, and Costlier-Setting Services. However, Respondent has proved that the psychiatric services during this relatively brief hospitalization were appropriate and not excessive. Presumably aware that inmates would prefer a hospital to a jail and might fake psychiatric symptoms, correctional officers nonetheless felt it necessary to transport Recipient 23 to the hospital due to his suicide threats. Upon arrival at the hospital, Recipient 23 exhibited symptoms consistent with a serious mental disorder. Respondent's psychiatrists treated Recipient 23 until, in fairly short order, he stabilized and was discharged without delay. Nor has Petitioner proved that the psychiatric services were Costlier-Setting Services for the reasons already discussed. The inpatient psychiatric services provided on September 9-14 were thus medically necessary. The next hospitalization took place from December 12-18. At the hearing, Dr. Mehra conceded the medical necessity of the CPT #99222 on December 12. (Tr. 259) But he testified that medical necessity was lacking for the psychiatric services provided from December 13-18. Again, Recipient 23 presented to the hospital with suicidal ideations. His plan was to cut his wrists, as, he claimed, to have done previously. Multiple stressors in his life included homelessness, unemployment, cocaine use, and alcohol abuse. His global assessment of functioning, on a scale of 0-100, was 30, which is, as Dr. Mehra graciously conceded, "on the low side." (Tr. 257) Respondent's psychiatrist gradually increased Recipient 23's Seroquel, but also placed him on Prozac during this hospitalization. Reflecting the seriousness with which hospital staff took Recipient 23's suicidal ideation, they put him on visual observation, followed by a check every 15 minutes. The psychiatric records reveal that, on December 13, Recipient 23 still suffered auditory hallucinations and suicidal ideation. He was still receiving 24-hour supervision. The Seroquel was increased the following day, as well as on December 16, after the patient's symptoms had not improved. After increasing the Seroquel again on December 17, Respondent's psychiatrist discharged Recipient 23 to Second Chance Recovery, although, instead of reporting to this halfway house, Recipient 23 returned to his halfway house in Pompano Beach. It is puzzling why Petitioner denied the December 13- 18 claims for a lack of medical necessity. If anything, Recipient 23 required a longer hospitalization: three days after discharge, he slashed his arm with a razor blade, leaving a 30 cm-long gash. The circumstances of the December 13-18 hospitalization plus the suicide attempt three days after discharge establish the medical necessity of the December 13-18 hospitalization. After slashing his arm, Recipient 23 was involuntarily Baker Acted on December 21 to a receiving facility, where Respondent's psychiatrist treated him. On admission, Recipient 23 revealed a plan to kill himself by running into traffic. Petitioner challenged the medical necessity of only the third and final days of this hospitalization--December 23 and 24. As Dr. Sobhan testified, ten years ago, Recipient 23 would have qualified for long-term commitment to a state hospital under the Baker Act. This was not necessarily the better approach to Recipient 23's mental illness. Because Recipient 23 eats and takes his medicine in the local hospital, he achieves sufficient short-term stabilization that short-term hospitalization followed by outpatient treatment produce a better prognosis than long-term hospitalization. However, as Dr. Segal concluded, Recipient 23's multiple hospitalizations over a relatively short period of time demonstrate the inadequacy of community resources, like halfway houses, whose levels of care are not sufficient for the treatment of Recipient 23's psychiatric symptoms during periods of exacerbation. Somewhat surprisingly, given his testimony that inpatient psychiatric services at local hospitals were not medically necessary, Dr. Mehra did not argue for lower-level-of- care settings, but for an equal or higher level-of-care setting--a state hospital. (Tr. 266) Addressing the patient's "best interest," if not medical necessity, Dr. Mehra opined that past failures of coordination of care in settings with lower levels of care than local hospitals militate against the providing of services in local hospitals. It is unnecessary to resolve the disagreement between Dr. Sobhan and Dr. Mehra about the efficacy of treating Recipient 23 in a state hospital. Petitioner did not prove that the state hospital is a lower level of care or that psychiatric services in this setting are reimbursed at a different rate than those provided in the local hospital. More importantly, both experts implicitly agreed that a lower level-of-care would not have been appropriate for Recipient 23 at the time. In a wider-ranging discussion triggered by the December 23 and 24 claims, but obviously not limited to Recipient 23, Dr. Mehra testified: "my concern has been not even whether the patients need to be in the hospital, but it's just kind of the documentation to kind of communicate that urgency or that need for things. So obviously, that's why on some of these cases where maybe I have overlooked it, I am very much willing to concede those dates that maybe I've missed." (Tr. 270) It seems that Dr. Mehra was approaching a concession as to the psychiatric services on December 23 and 24--and perhaps other dates of service regarding Recipient 23 and even other recipients. With or without his concession, the inpatient psychiatric services on December 23-24 were medically necessary. Recipient 23's next hospitalization took place less than three weeks after discharge on December 24. For the January 10-12, 2010, hospitalization, Petitioner denied, as noted above, the CPT #99238 on January 12. This hospitalization was necessitated by Recipient 23's calling 911 and stating that he was holding a blade wanting to kill himself. Sheriff's deputies disarmed him and transported him to the hospital where he was admitted under the Baker Act, although Recipient 23 later agreed to hospitalization. As before, while hospitalized, Recipient 23 ate, took his medicine, and improved. Dr. Sobhan noted in the medical records a concern that the patient was manipulative, but testified that denying admission to patients such as Recipient 23 is impossible when they appear in emergency rooms threatening to kill themselves and emergency room physicians admit them under the Baker Act. Dr. Mehra sensibly seized on the possibility that Recipient 23 was manipulating the system in order to be hospitalized. Dr. Mehra asked whether physicians were really helping this patient by repeatedly admitting him. With equal logic, though, Dr. Sobhan responded that it is hard to deny admission or discharge a patient who tells everyone that he is suicidal, so that it is well-documented in the records. Dr. Segal stated that, if a patient has a good support system, he does not believe that he must hospitalize such a patient, even if she has voiced suicidal ideas. But Recipient 23 was unstable, lacked outside support, and had recently cut himself badly in a suicide attempt. This is a closer call, but the final day of inpatient hospital services was medically necessary. As Dr. Segal testified, the day of discharge is time-consuming for the treating physicians to try to ensure that the patient will receive continuity of care post-hospitalization and perhaps avoid the need of rehospitalization. This is exactly what the subject CPT code covers. The importance of such efforts is underscored in a case such as Recipient 23, as he was in and out of the hospital repeatedly in a brief period of time. Lastly, as to psychiatric services and their medical necessity, Recipient 23 was hospitalized February 6-8. Petitioner denied each CPT #99223 on February 6 and 7, as well as the CPT #99232 on February 8. Although these dates of service appear on Attachment C, the expert witnesses neglected to discuss these dates of service. Of the 476 pages of medical records for Recipient 23 included in the present record, only pages 2290-91 address this hospitalization. Page 2290 is irrelevant to this case. Dated February 6, page 2291 covers psychiatric services, mentions a treatment plan, and refers to Recipient 23's presenting on that day at the hospital with suicidal ideation, depression, and substance dependence. Given the richly developed record concerning Recipient 23 and the proximity of the February 6 date of service to earlier and later hospitalizations, the spare comments on page 2291 support a finding of medical necessity for February 6, but not February 7 and 8, for which no evidence whatsoever exists. Additionally, even though a different psychiatrist saw Recipient 23 on February 7 than who saw him on the prior day, the February 7 date of service did not qualify for another CPT #99253.13/ Respondent's failure to prove that the February 7 and 8 psychiatric services were not Inappropriate Services or Excessive Services means that Petitioner's denial for a lack of medical necessity is sustained. As noted above, the downcodings involve the medical services provided on December 14-18 and 23-24. At the time of admission on December 12, 2009, Respondent presented medically with hyperlipidemia, hypertension, ademia, localized osteoarthrosis, seborrheic dermatitis, and gastroesophageal reflux disease (GERD). On December 14, the progress notes record only dermatitis, a toothache, and a third condition, which is illegible. Dr. Hoffman testified that this was a problem focused interval history, detailed examination, and straightforward medical decisionmaking. She is correct. The skin condition and toothache appear minor, and the patient was "stable, recovering or improving." There was no complexity to the decisionmaking, and the history was no more than problem focused. On December 15, the progress notes record GERD, hypertension, seborrheic dermatitis, and a fourth condition that is illegible. The patient's vital signs were within normal limits. Dr. Hoffman testified that the medical decisionmaking was of low complexity and implied that the history was problem focused. She is correct. On December 16, the progress notes record dental pain over night, hypertension, and seborrheic dermatitis. Dr. Hoffman testified that the medical decisionmaking was still of low complexity, and the history was problem focused. Again, Dr. Hoffman is correct.14/ On December 17, the progress notes record GERD, seborrheic dermatitis, and tooth pain. The tooth pain had decreased, and the dermatitis remained a minor issue, although the hypertension had turned to hypotension. Dr. Hoffman testified that the medical decisionmaking remained of low complexity, and the history problem focused. On December 18, the progress notes record GERD, tooth pain, seborrheic dermatitis, and hypertension. The tooth pain had improved. As Dr. Hoffman testified, the medical decisionmaking remained of low complexity, and the history problem focused. Dr. Hoffman's testimony was correct as to these dates of service. Dr. Segal's rebuttal for the medical claims for this hospitalization occasionally blended the psychiatric services into the medical services. He stressed a more complicated past history, but failed to explain how these potentially complicating components were relevant to the subject hospitalization. Dr. Segal helpfully pointed out the potential complexity of medical decisionmaking in terms of the management of the many medications that Recipient 23 was taking. But ultimately Dr. Segal failed to overcome Dr. Hoffman's testimony about the complexity of the medical decisionmaking. The multiple medications were a complicating factor, but were more than offset by the limited number of possible diagnoses and management options, the lack of complexity of medical records and diagnostic tests, and the absence of risk of significant complications, morbidity, or mortality associated with the relatively minor presenting problems. Obviously, the December 21-24 hospitalization was driven by the patient's psychiatric deterioration, which, as noted above, resulted in a serious wound to the arm during an apparent suicide attempt. As Dr. Hoffman testified, for December 23, the progress notes reveal that the chief complaint was the wound to the arm; without more, this was a problem focused history. Although the examination was detailed, the medical decisionmaking was of low complexity. For December 24, the progress notes state that the wound was healing, and mild hypotension and dehydration were concerns. As Dr. Hoffman testified, this was a problem focused history with medical decisionmaking of low complexity. The downcodings are all correct. Petitioner therefore improperly denied all of the psychiatric claims except for those of February 7 and 8 and properly downcoded all of the medical claims. Recipient 26 For Recipient 26, a 13-year-old male diagnosed with bipolar or depressive disorder, only one hospitalization is at issue. From April 29-May 5, 2009, Recipient 26 was hospitalized at Memorial Healthcare System for treatment of a recurrence of aggressive behavior, including threatening to kill his mother with a butter knife. At issue are the following billed CPT codes: April 30: #99232 May 1: #99232 May 2: #99232 May 3: #99232 May 4: #99232 May 5: #99232 Petitioner denied these claims involving psychiatric services for a lack of medical necessity. At hearing, after a discussion between Dr. Segal and Dr. Mehra as to the care of Recipient 26, Dr. Mehra conceded the medical necessity of April 30 and May 1. The remaining dates still in dispute are thus May 2-5. As Dr. Segal testified, Respondent's psychiatrists are "very careful" about putting children on medications, but, to control Recipient 26's symptoms, it was necessary to put him on four powerful medications: Prozac, Abilify, Trazodone, and Buspar. From April 29 to May 2, Recipient 26 was also on Ativan. Early in the hospitalization, Recipient 26 displayed depression and poor eye contact, and he was nonverbal. He was on elopement precautions during his hospitalization. On May 1, Recipient 26 was also responding to internal stimuli. The lack of improvement in symptoms caused the psychiatrist to establish a rule-out diagnosis of pervasive development disorder. Because Recipient 26 was no longer displaying aggressive behavior that posed a risk to his mother, Respondent's psychiatrist decided to discharge him on May 5. Dr. Mehra's testimony predicated a lack of medical necessity for the final four days of this seven-day hospitalization on the lack of need to continue to observe and stabilize the child. Dr. Segal responded that they were treating a "very sick child" and could not have dealt with the situation, including the introduction of new medications, any faster in the inpatient setting. Recipient 26 had undergone another psychiatric admission on February 18-24, 2009, during which time he was placed on suicide and elopement precautions. For this earlier hospitalization, Recipient 26 had been Baker Acted for assaulting his younger sister. For the entire hospitalization, Recipient 26 had refused to respond to questions during psychotherapeutic sessions, responding instead with gestures. The child's mother had advised, at one time, that he only spoke at home. This hospitalization had concluded with a reference to the Henderson Community Mental Health Center and instructions for the child to attend an aftercare program. The subject hospitalization took place only two months later. Following the subject hospitalization, Recipient 26 was next hospitalized, according to the medical records, in December 2009. Dr. Mehra is right about this case. Neither the documentary record nor Dr. Segal's testimony establishes the medical necessity for psychiatric services after May 1. Notwithstanding the apparent illness of the child, the evidentiary record fails to establish if it was necessary to provide services to monitor the introduction of new drugs or existing drugs in higher doses, to provide services to continue to stabilize the child, or to provide services toward a diagnosis concerning pervasive development disorder. For these reasons, Respondent has failed to prove that the services provided after May 1 were not Inappropriate Services. Petitioner therefore improperly denied the psychiatric claims of April 30 and May 1, but properly denied the remaining psychiatric claims. Recipient 27 For Recipient 27, a 52-year-old male diagnosed with bipolar disorder, depression, and alcohol and cocaine dependence, only one hospitalization is at issue. From August 26-September 1, 2009, Recipient 27 was hospitalized at Broward Health for treatment of an exacerbation of the symptoms of his bipolar disorder and depression. At issue are the following billed CPT codes: August 27: #99232 August 28: #99232 August 29: #99232 August 30: #99231 August 31: #99232 Petitioner denied these claims involving psychiatric services for a lack of medical necessity. Recipient 27 was homeless. He had no support from family or friends. The evidentiary record documents repeated hospitalizations during the audit period. All of the hospitalizations follow a pattern. Recipient 27 fails to take his medications, ingests cocaine and/or large volumes of alcohol, feels hopeless and sometimes suicidal, and is hospitalized for a brief period so that his habitual use of intoxicants can be abated, medications can be reestablished, and psychiatric condition can be stabilized. During these hospitalizations, Recipient 27 receives medical treatment for a variety of conditions, mostly associated with his largely untreated diabetes. According to the medical records, Respondent's psychiatrist ordered an increase in Recipient 27's antipsychotic medication, Seroquel, on August 27. On that day, Recipient 27 continued to demonstrate childlike behavior, poor contact with reality, disorganized thought, and persecutory delusions. Recipient 27's condition was unchanged until August 31, when he exhibited some improvement. Dr. Mehra's main criticisms involved the medical records. For instance, the form prompts the psychiatrist to describe the persecutory delusions, if present, and Respondent's psychiatrist did not do so. Likewise, the form prompts the psychiatrist to supply a chief complaint, but Respondent's psychiatrist did not do so. And the medical records reveal little of what is going on with the patient. Dr. Mehra made a good case for downcoding the CPT #99232 to #99231 for August 27-29 and August 31, but Petitioner has staked its challenge on a lack of medical necessity, not upcoding. In a closer case, the omitted information on the forms might have proved material, but, on these facts, Respondent has proved that the psychiatric services in question were not Inappropriate Services or Excessive Services. Petitioner has failed to prove that they were Costlier-Setting Services. Recipient 27 is a good example of the effects of transportation, motivation, and substance-abuse problems combining with a lack of insight to preclude successful treatment in lower levels of care. Dr. Mehra did not suggest a lower-level-of-care setting, but seemed to focus on what he viewed as the inadequacy of the medical records. Petitioner therefore improperly denied the psychiatric claims of August 27-31. Recipient 29 For Recipient 29, a 33-year-old male diagnosed with schizophrenia, only one hospitalization is at issue. From April 21-30, 2009, Recipient 29 was hospitalized at Broward General Medical Center for treatment of an exacerbation of the symptoms of his schizophrenia. At issue are the following billed CPT codes: April 27: #99232 April 28: #99232 April 29: #99232 April 30: #99238 Petitioner denied these claims involving psychiatric services for a lack of medical necessity. After listening to Dr. Segal's testimony, Dr. Mehra conceded the medical necessity of the inpatient services on April 27-28. (Tr. 300) Dr. Mehra testified, though, that the patient was ready for discharge by April 29. Dr. Mehra did not address the fact that Recipient 29 was readmitted to the hospital on May 9--just 10 days after when Dr. Mehra opined that he had been ready for discharge and eight days after he had been actually discharged. Dr. Mehra did not address that, on readmission, Recipient 29 presented with suicidal and homicidal ideations--both with plans--and command delusions, among other symptoms. At the time of the subject admission, Recipient 29 was hearing voices telling him to hurt himself and others. Reportedly, Recipient 29 had access to a gun. On April 24, Recipient 29 stated that a voice was telling him to kill people. His insight and judgment remained limited. Until April 26, the reason cited in the medical records for continued hospitalization was a need to continue to plan. On April 27, the reason was changed to monitor changes in medications. On April 28, Recipient 29 reported hallucinations of ghosts and asked for an increase in his antipsychotic medication, Trilafon--an unusual request from a psychiatric patient. At that time, lab work indicated that blood levels of Depakote were low, so Respondent's psychiatrist had to increase the Depakote and Trilafon. Although the patient was still childlike, bizarre, irritable, and disorganized of thought, the psychiatrist determined that he could be safely discharged on his newly adjusted medications. The unsettled condition of Recipient 29 on April 28 precluded his discharge the next day. The mental illness and psychiatric symptoms that necessitated this hospitalization amply justified the last two dates of service at issue, as further evidenced by another psychiatric hospitalization eight days after discharge. Recipient 30 For Recipient 30, a 52-year-old female diagnosed with schizoaffective disorder and bipolar disorder, four hospitalizations are at issue. From August 5-10, October 8-20, October 28-November 3, and December 11-22, 2009, and February 12-17, 2010, Recipient 29 was hospitalized at Broward General Medical Center for treatment of exacerbations of the symptoms of her schizophrenia. At issue are the following billed CPT codes: August 6: #99232 August 7: #99232 August 8: #99232 August 10: #99238 October 17: #99232 October 18: #99232 October 19: #99232 October 20: #99232 October 29: #99232 October 30: #99232 October 31: #99232 November 1: #99232 November 2: #99232 December 17: #99232 December 18: #99232 December 19: #99232 December 19: #99232 December 20: #99232 December 21: #99232 February 12: #99223 February 13: #99233 February 14: #99231 February 15: #99233 February 16: #99233 February 17: #99239 Petitioner denied these claims for a lack of medical necessity, except that it downcoded one of the CPT #99232 claims for services on December 19 to CPT #99231. All of the claims at issue were for psychiatric services, except the downcoded claim was for medical services. At the hearing, after learning that illegible notes pertained to chest pain, Dr. Hoffman conceded that the December 19 medical service was properly billed at CPT #99232. (Tr. 516) The remaining services at issue are psychiatric. At the hearing, Dr. Mehra conceded the medical necessity of the psychiatric services for August 6-7 (Tr. 306-07) and February 12-14. (Tr. 324) The four hospitalizations in this case all took place within seven months; the first three of these hospitalizations took place within five months. The first hospitalization was the result of a Baker Act. Recipient 30 presented at the emergency room with depression, homicidal and suicidal ideation, psychosis, auditory hallucinations, and a history of polysubstance abuse, including cocaine, marijuana, and alcohol. Lab work subsequently revealed the presence of alcohol, cocaine, and marijuana. She was violent, hitting and biting at hospital personnel, who had to restrain her at the wrists and ankles. On August 6, Recipient 30 continued to be depressed and displayed, among other things, symptoms of alcohol withdrawal, psychotic behaviors, rocking, and flight of ideas. The next day, Recipient 30 continued to display depression, disorganized thinking, and hallucinations. Dr. Segal described the psychiatric services from August 5-7, but he skipped to August 10 in his testimony, explaining the discharge on that date by noting that the patient was on her medications and, with much greater insight, recognized that she was doing better. (Tr. 305) Dr. Mehra likewise skipped the last two days in question from this hospitalization. (Tr. 306-07) The physician's progress note for August 8 states that Recipient 30 was more depressed, but no longer had suicidal or homicidal ideation. Her thought process had improved from a flight of ideas to disorganized thought. Her cognition was grossly intact. There does not appear to be any note for August 9. Respondent has proved that the psychiatric services on August 8 were not Inappropriate Services or Excessive Services, and Petitioner has failed to prove that they were Costlier-Setting Services. However, Respondent has failed to prove that the psychiatric services on August 10 were not Inappropriate Services. The next dates at issue are October 17-20. The start of this hospitalization was October 7, again involuntarily under the Baker Act. Through October 17, Recipient 30 displayed rocking, auditory hallucinations, depression, disorganized thought, and paranoia, according to Dr. Segal and the records. The next day was the first that the patient was not rocking, although she still suffered from paranoia and auditory hallucinations. The rocking returned on October 19, and she exhibited increased suicidal ideation--clear signs of regression, as testified to by Dr. Segal. She exhibited marked improvement on the following day, at which time she was discharged. Dr. Mehra questioned whether the auditory hallucinations were of the command variety, and he dismissed the rocking as justification for continued hospitalization. Dr. Segal responded that Recipient 30 was rehospitalized about one week after this discharge. Through October 20, Dr. Segal reasoned that Recipient 30 was still psychotic, manic, and unsafe for a lower level-of-care setting, such as the assisted living facility at which she resided. Dr. Segal observed that, shortly after discharge on October 20, Recipient 30 was cycling between mania and depression. Dr. Segal noted that Recipient 30 was Baker Acted again on October 28. She was suffering from suicidal ideation and again intoxicated with alcohol, drinking massive quantities of beer daily and consuming cocaine and marijuana. The next day, Recipient 30's mood was less stable, her thinking more disorganized, and her irritability more pronounced. These symptoms continued unchanged through October 30. On October 31, Recipient 30 continued to suffer from hallucinations and delusions, disorganized thought, depression, and poor judgment, but she was no longer entertaining ideas of suicide. On November 1, Recipient 30 was no longer entertaining thoughts of suicide, but she continued to have unspecified delusions and hallucinations. On November 2, Recipient 30 was free of delusions and hallucinations, and she was discharged. Dr. Mehra rightly complained about the documentation for the second October hospitalization. (Tr. 314) Despite the close proximity of these hospitalizations--although the next one was nearly six weeks thereafter--the medical necessity of psychiatric services on October 31-November 2 is absent; Respondent has failed to prove that these services were not Inappropriate Services. Psychiatric services were necessary through October 30, which was the last day of reported suicidal ideation, but not thereafter. By contrast, Respondent has proved that the psychiatric services provided from October 17-20 were not Inappropriate Services or Excessive Services, and Petitioner has failed to prove that they were Costlier-Setting Services. On these days, Recipient 30 continued to display varying levels of symptoms, including suicidal ideation. Worrisome regression had taken place in this brief period. If anything, her discharge on October 20 was premature, as suggested by her readmission eight days later. The next hospitalization started December 11, as Recipient 30 was again Baker Acted with suicidal and homicidal ideations. Her blood alcohol level at admission was .355. She had been living on the streets prostituting herself. She had been participating in the community mental-health services provided by the Henderson Mental Health Center, but Henderson personnel had encouraged her to enter the hospital at this time, evidently due to a recent exacerbation in symptoms. As pointed out by Dr. Segal, the Henderson wraparound services, including mental health targeted case management, were insufficient for Recipient 30. On December 17, Recipient 30 was still in withdrawal from alcohol. Her thinking was disorganized with a flight of ideas. She was depressed. She no longer suffered from suicidal or homicidal ideations. The next day, though, Recipient's suicidal ideation returned. There was a question whether she was suffering from hallucinations and delusions. For the next two days, December 19-21, Recipient 30 continued to exhibit depression with compromised insight and judgment, and she felt hopeless and was unable to agree not to hurt herself, if discharged. Dr. Mehra objected again to the documentation. (Tr. 318) Noting that Recipient 30's symptoms "seem to be pretty consistent, irrespective of whether she says [in the hospital] for three days, five days or ten days," Dr. Mehra agreed that "there's some type of psychiatric condition here that needs some type of treatment. The question beckons, at what level of care . . .?" (Tr. 319) As Dr. Mehra noted, Recipient 30 presented with one or more psychiatric conditions that required treatment during this and all hospitalizations at issue. Dr. Mehra did not contend that the psychiatric services in the December hospitalization were Inappropriate Services and appears not to contend that they were Excessive Services. In either event, Respondent has discharged its burden of going forward as to these issues. The underlying objection of Dr. Mehra seems to be that the psychiatric services from December 17-21 are Costlier- Setting Services. Perhaps exhibiting frustration with the apparent lack of progress with Recipient 30, Dr. Mehra implies that the appropriate setting is at a lower level of care. These claims fail for the reasons discussed above. As to level of care, Dr. Mehra's criticism ignores that, immediately preceding this hospitalization, Recipient 30 was receiving fairly intensive community services, and clearly these services were insufficient. Dr. Mehra's level-of-care testimony also fails to account for the repeated failures of hospital-based psychiatric services. The psychiatric services during the December 17-21 hospitalization were medically necessary. Recipient 30's final hospitalization at issue took place from February 12-17, of which only the last three dates require consideration after Dr. Mehra's above-described concession at hearing. This hospitalization was due to suicidal and homicidal ideation and depression. Recipient 30 had been living in Second Chance Recovery, but had regressed into violent behavior, severe depression, severe anxiety, manic behavior, and auditory and visual hallucinations. After having enjoyed 60 days of sobriety, Recipient relapsed from alcohol abstention. On February 15, Recipient 30 continued to display the features of her manic episode: agitation, loud and pressured speech, and hostility. On February 16, she continued to demonstrate irritability, loose associations, and loud and pressured speech. Respondent's psychiatrist was still waiting for lab work on her Depakote level. On February 17, Recipient 30 was improved. In fact, the progress notes for February 17 as to psychiatry reflect a lined-out entry: "Pt interviewed. Chart reviewed and [discussed with] staff." In the place of this somewhat formulaic note is: "Pt doing better. Improved. No need for further stay." There are some illegible notations, but one note reports the Depakote level at 70.9. (Petitioner Exhibit 30, p. 4591) Dr. Mehra rightly questioned how the patient progressed from February 16 when she suffered from a flight of ideas and loose associations to discharge-ready the following day. (Tr. 324-25) Although he admitted that such an improvement is possible, Dr. Mehra implied that it is likelier that no such sudden improvement ever took place. The consequences that follow this implication require careful consideration. If the sudden-improvement scenario were disregarded, then Dr. Mehra had two options: discredit the notes of the preceding days and credit the cheery note on the day of discharge or credit the notes of the preceding days and discredit the cheery note on the day of discharge. By choosing the former option, Dr. Mehra was able to deny a couple of days of services for a lack of medical necessity. But recent experience with Recipient 30 does not support Dr. Mehra's choice. Recipient 30 had been hospitalized repeatedly for serious psychiatric symptoms. She had had an unusually long 11-day hospitalization in December. In October, she had required rehospitalization eight days after discharge, suggesting, if anything, a premature discharge. On February 17, Respondent's psychiatrist obtained the Depakote level, which apparently was satisfactory. If one had to choose between the manufacturing of symptoms on the February 15-16 records and an optimistic, but selective, effort to justify discharge on the February 17 records, the evidence would favor the latter, as the psychiatrist, perhaps daunted by the prospect of another lengthy hospitalization, may have been tempted to downplay any remaining symptoms to facilitate an early discharge. More relevantly, among the three scenarios--the manufacturing of symptoms, an unduly sunny rendering of symptoms, and a dramatic overnight recovery--the record permits only the finding that February 15-16 records are unlikely to have been inaccurate. This was a sick patient with recurrent, persistent symptoms. It is unnecessary to determine which of the remaining two scenarios explains the February 17 records. Respondent has proved that the February 15-17 psychiatric services were not Inappropriate Services or Excessive Services, and Petitioner has failed to prove that they were Costlier-Setting Services. Petitioner has therefore properly denied the psychiatric claims of August 10 and October 31-November 2 for a lack of medical necessity, but has improperly denied the remaining psychiatric claims. Conclusion As noted above, Attachment C itemizes 83 denials of reimbursements of psychiatric claims for a lack of medical necessity, two denials of reimbursements for double billing, and 16 "adjustments" (i.e., reductions) of reimbursements of medical claims for upcoding. Of the 83 denials, Petitioner has prevailed as to only 10. Of the two denials, Petitioner has prevailed as to both. Of the 16 reductions, Petitioner has prevailed on 15--failing to prevail only as to one reduction that Petitioner conceded at hearing. Statistical Estimation of Total Overpayment In addition to disputing Petitioner's overpayment determinations among the sampled recipients, Respondent has contested the means by which Petitioner has inferred the total overpayment for the population of 2765 recipients from the overpayment determined for the 30 recipients. Each party presented an expert witness to provide statistical evidence supporting or discrediting the process by which Petitioner inferred the total overpayment. Petitioner's expert was Dr. Fred Huffer, and Respondent's expert was Dr. Bruce Kardon. Both experts patiently explained important statistical concepts and applied them to this case. Their testimony has been most useful. Dr. Kardon defined the nomenclature to describe different processes by which one could proceed from the overpayment for the sample to the overpayment for the population. The most accurate method to determine the total overpayment is not inference at all; it is counting. Apart from the time and expense, nothing prevents Petitioner from auditing each of the 2765 recipients and each of the 27,681 claims associated with these recipients, just as Petitioner has done with each of the 30 recipients and each of the 387 claims associated with them. For obvious reasons, Dr. Kardon did not propose this approach. Between counting and its opposite--guessing--is what Dr. Kardon identifies as estimation, which is produced by any statistically valid process by which the determined overpayment from the sample is extended to a total overpayment among the population. Dr. Kardon testified that the estimation process used by Petitioner in this case is invalid. For the reasons set forth below, this testimony has been rejected. In summary, Petitioner's estimation process in this case commenced with the selection of a random sample of 30 recipients. Petitioner determined the sample overpayment after analyzing each of these claims for accuracy. Dividing the sample overpayment total by 387 claims, Petitioner obtained the average overpayment per claim. Multiplying the average overpayment per claim by 27,681 claims in the population yielded the point estimate of total overpayments for the population. Petitioner's estimation process did not stop with the point estimate, though. Petitioner next determined the standard error, which is a measure of how variable the point estimate is. In this case, the standard error was about $99,600. Obtaining the appropriate multiple from statistical tables to derive the 95% confidence interval identified below, Petitioner then calculated a multiple of the standard error, which it then subtracted from the point estimate to arrive at the lower limit of the 95% confidence level. The estimated total overpayment corresponding to this lower limit of the 95% confidence level is the amount of overpayment identified in the FAR. Petitioner's estimation process involved only a few steps. First, Petitioner selected a random sample of recipients from the population. Petitioner routinely selects 30 recipients for each of its samples. Dr. Kardon objected dutifully to the randomness of the sample. But his objection may have been due to the failure of Petitioner to have provided him timely with all of the supporting statistical documentation. In fact, there is no reasonable doubt as to the randomness of the sample. Dr. Huffer testified that Petitioner's database management program contains a suitable random number generator. Dr. Huffer admitted that, some years ago, random number generators sometimes were flawed, but these problems are no longer common. After identifying the recipients to be sampled, Petitioner identified the number of claims per recipient during the audit period. In all audits, Petitioner must determine if the number of claims per recipient is small enough to permit analysis of each claim. If it is, Petitioner proceeds to analyze each claim of each sampled recipient. If the number of claims is too large, Petitioner selects a random sample of claims for each recipient and analyzes these claims, rather than all of the claims of the randomly selected recipients. These two approaches represent the single-stage or two-stage cluster sampling process for estimation. The clusters are the recipients. In this case, the number of claims was small enough to permit analysis of each claim, so Petitioner performed a single-stage cluster sampling. If a sampling of claims had been required to produce a more manageable number of claims for audit, Petitioner would have performed a two-stage cluster sampling. Essentially, Dr. Kardon challenges Petitioner's estimation process on two related grounds: the sample size of 30 recipients is too small, and consequently the sample is unrepresentative of the population.15/ Additionally, Dr. Kardon argues for the use of the unbiased estimator--described below-- to extend the sample overpayment to the population overpayment. Essentially, Dr. Huffer defends these challenges on two grounds: Petitioner invariably uses the same methods for the same sampling conditions to avoid charges of unfairness, and simulations conducted by Dr. Huffer demonstrate the validity-- and fairness--of the methods used by Petitioner to estimate the total overpayment. In all cases involving a one-stage cluster sample, Petitioner uses a ratio estimator to generate the point estimate. This was reflected in the multiplication of the average overpayment per sampled claim by the total number of claims in the population, as discussed above. In all cases involving a two-stage cluster sample, Petitioner uses an unbiased estimator to generate the point estimate.16/ Dr. Kardon's preference for the unbiased estimator for the one-stage cluster sample--or at least Respondent's one- stage cluster sample--not only invites individualized decisionmaking by Petitioner to shape outcomes, but fails to address the suitability of the ratio estimator when applied to monotone relationships. Given the direct relationship between the number of claims and size of the overpayment, the ratio estimator typically provides more accuracy than the unbiased estimator. Dr. Huffer ran several million simulations using a 30-unit cluster sample--some with the ratio estimator and some with the unbiased estimator. For one set of simulations, in which Dr. Huffer scaled the 30-unit cluster to the 2765-unit population, Dr. Huffer demonstrated that the ratio-estimator approach was more "precise"--as in leading to a "much smaller standard deviation for the point estimate." (Id. at p. 22) Dr. Kardon's argument for invalidity based on the nonrepresentative nature of the cluster sample fails to account adequately for the fact that Petitioner's estimation process did not stop with the identification of the point estimate. As noted in the preceding paragraph, his argument for the unbiased estimator is wrong. For one-stage cluster estimations where the number of claims is in direct relationship to the size of the overpayment, Dr. Huffer demonstrated that the 95% confidence interval is narrower using the ratio estimator than for estimations using the unbiased estimator. Dr. Kardon's argument for a greater sample size is stronger. All other factors remaining equal, a larger sample size would produce a narrower 95% confidence interval. But the shortcomings of a smaller sample size are offset--at least with a 30-unit sample size--by a wider 95% confidence interval-- especially, where, as here, Petitioner selects the lower limit of the interval to establish the provider's overpayment liability, rather than the point estimate or some other point within the confidence interval. Obviously, Petitioner's selection of the lower limit of the 95% confidence interval is more favorable to a provider than the selection of any other value within the 95% confidence interval, including the point estimate. As Dr. Huffer testified (id. at p. 30), Dr. Kardon's criticisms seem, at times, to fail to give adequate weight to this point. Dr. Huffer's simulations quantify the extent to which Petitioner's selection of the lower limit of the 95% confidence interval favors providers. Based on his work, Dr. Huffer estimated the probabilities of a five percent overcharge at about 1.4% and a 10 percent overcharge at about 0.5%. On average, Petitioner's estimation method undercharges a provider by about 30% of the total, actual overpayment. Overall, Petitioner's estimation undercharges a provider 95% of the time. Based on an illustration provided by Dr. Huffer (id. at p. 29), these probabilities and the magnitude of the consequences of various contingencies can be seen by using an example of a mortgage debt of $100,000. The lender offers all of its borrowers a chance to discharge their debt by paying an amount to be determined randomly, but pursuant to a process that ensures that the randomly generated payoff amount will average only 70% of the outstanding indebtedness and will be less than the outstanding indebtedness 95% of the time; however, 1.4% of the time the randomly generated payoff amount will exceed the outstanding indebtedness by 5%. If a borrower's outstanding indebtedness is $100,000, her offer is that the average payoff will be only $70,000 and 95% of the time the payoff will be less than $100,000, but 1.4% of the time the payoff will be $105,000. Dr. Kardon's argument for a larger sample size requires close consideration. At some point, it would seem, the sample size becomes so small and, correspondingly, the 95% confidence interval becomes so wide as to call into question the utility, if not the validity, of the estimation process.17/ Dr. Huffer's simulations quantify the effect of doubling the sample from 30 to 60 units. Of course, doubling the sample size would produce gains in accuracy, but not much. In the simulations, if all other factors remained equal, doubling the sample size decreased the average underpayment from about 30% to about 20%. (Petitioner Exhibit #24, second volume, p. 104) So, a doubling of the sample size--with a doubling of the effort of the agency and provider in audit and litigation-- would produce only a 33% improvement in accuracy--an improvement in accuracy that almost invariably would come at the expense of the provider. Interestingly, noting the weak relationship between increases in the size of the sample and the size of the estimated overpayment, Dr. Huffer explained Petitioner's apparent largesse in undercharging providers 95% of the time and using a sample of merely 30 recipients: Petitioner can do more audits, using the same resources. (Id.) In other words, Petitioner could audit 60 recipients and, on average, increase the estimated overpayment by 33%--or it could audit only 30 recipients and, with the same resources, conduct a second audit of a different provider, which would go unaudited in the first example. Lastly, Dr. Kardon argued for stratification of the data to produce more accurate results. As noted above, under the estimation process used by Petitioner, more accurate results are not required for statistical validity or basic fairness. Stratifying the sampled data would likely be a case-specific exercise, leaving Petitioner open to challenges that it chose to stratify or chose specific stratification criteria in order to maximize overpayments. So, while properly selected stratification criteria would produce a narrower 95% confidence interval--and likely a higher lower limit--this would be an example of the medical adage that better is the enemy of good.18/
Recommendation It is RECOMMENDED that: Petitioner shall enter a final order determining the sampled overpayment as set forth in the Findings of Fact and directing a re-run of the statistical estimation process described in the FAR and this Recommended Order to determine the total overpayment; and If, after Petitioner determines the new total overpayment, the parties are unable to agree on costs and fines, Petitioner may remand the matter(s) to DOAH for further proceedings as to either or both of these issues, to which DOAH retains jurisdiction. DONE AND ENTERED this 23rd day of August, 2013 in Tallahassee, Leon County, Florida. S ROBERT E. MEALE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 23rd day of August, 2013.
Conclusions The Agency served the Petitioner with a Notice of Intent to Impose Late Fine dated March 24, 2009 notifying the Petition of its intent to impose an administrative fine in the amount of five thousand dollars ($5,000.00), attached hereto and incorporated herein (Ex. 1). Petitioner requested a formal hearing at the Department of Administrative Hearings. The Agency also served the Petitioner with a Notice of Intent to Deny dated May 15, 2009, notifying the Petitioner of its intent to deny its renewal application, a tached hereto and incorporated herein (Ex. 2). The Agency for Health Care Administration ("Agency") has entered into a Settlement Agreement (Ex. 3) with the other party to these proceedings and being otherwise well-advised in the premises, finds and concludes as follows: ORDERED: The attached Settlement Agreement is approved and adopted as part of this Final Order, and the parties are directed to comply with the terms of the Settlement Agreement. The Notice of Intent to Impose Late Fine and Notice of Intent to Deny are superseded by this agreement. Filed July 2, 2009 3:19 PM Division of Administrative Hearings. Petitioner has paid an administrative fee in the amount of $2,000.00. Each party shall bear its own costs and attorney's fees. 9Ld..l. _ The above-styled cases are hereby closed. DONE and ORDERED this .;:l,?t:f.y of Leon County, Florida. , 2009, in Tallahassee, Holly enson, Secretar Agency for Health Care Administration A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A SECOND COPY, ALONG WITH FILING FEE AS 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 OF PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED. Copies furnished to: Tatiana Perez, Owner Lourdes Residence, Inc. 5770 SW 5th Terrace Miami, Florida 33144 (U.S. Mail) MaryAlice H. David Assistant General Counsel Agency for Health Care Administration 2727 Mahan Drive, Bldg #3, MS #3 Tallahassee, Florida 32308 (Interoffice Mail) Finance & Accounting Agency for Health Care Administration Revenue Management Unit 2727 Mahan Drive, MS #14 Tallahassee, Florida 32308 (Interoffice Mail) Bernard E. Hudson Agency for Health Care Administration 2327 Mahan Drive, MS #46 Room #310 Tallahassee, Florida 32308 (Interoffice Mail) Jan Mills Agency for Health Care Administration 2727 Mahan Drive, Bldg #3, MS #3 Tallahassee, Florida 32308 (Interoffice Mail) CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of this Final Order was served on the above-named person(s) and entities by U.S. Mail, or the method designated, on this theZ y y of 2009. fAgielnccy fhor HSealthhCa=re A=dministration 2727 Mahan Drive, Building #3 Tallahassee, Florida 32308-5403 (850) 922-5873
Findings Of Fact During the period August 26-28, 1985, James L. Myrah, a hospital consultant for DHRS, accompanied by Ms. Christine Denson, a registered nurse, and other consultants in various disciplines from the Petitioner's office of licensure and certification, conducted a licensure, medicare, medicaid and civil rights survey at the Respondent's facility in Ft. Walton Beach, Florida. During the course of this survey, Mr. Myrah followed the normal procedure for such inquiries which included an entrance conference with the administrator, and a survey process which includes looking at various items for as many days as is required to do a thorough job.1 As a part of the survey, the team looks at every resident physically but examines patient charts on the basis of a random sample. In the instant case, examination of the patient records kept by the Respondent revealed only one variance. That was brought to the attention of the Petitioner's Office of Licensure and Certification by the Local District I omebudsman who commented about a particular patient, whose name will not be recited to preserve patient confidentiality, but whose initials, M.C., will be used as identification. By the time the survey was conducted, M.C. had already been transferred to another nursing home and was not physically present. Therefore, the inspection team was unable to examine her. However, they did examine her medical records and chart closely. This examination resulted in Petitioner drawing the conclusion that Respondent was in violation of the require ment for notification to the patient's physician whenever there is a substantial significant change in the patient's condition. The patient's chart was not entered into evidence. The report form identifying the deficiency (HRS Form 553E) was prepared by the inspection team based on its evaluation of the patient records. This was not objected to by Respondent, and in the absence of any objection to its entry, it was accepted. The entry for the 11 p.m. to 7 a.m. shift on May 22, 1985, reflects,2 "Total care given, nothing per os (by mouth) past midnight. Dr.'s appointment in am--resident seems very listless not talking as usual. Several small bruises noted on lower extremities (rt.) foot very discolored." This entry is, in the opinion of Ms. Denson, important because it relates to the fact that the patient was to go to the doctor in the morning. The use of the term "listless" might indicate a serious medical condition and a change of condition which should have been reported to the person next in charge. The term, "not talking as usual" shows a change that would require comment. In addition, the comment regarding the discoloration of the foot should have been reported to someone and not allowed to remain uncommented on until the visit with the doctor the next morning. The patient saw her physician, Dr. Wilson, at 8 a.m. on May 22, 1985; and returned to the home at 10 a.m. the same morning. Apparently nothing was considered to be wrong with the patient because no prescription for medicine or other treatment was given by the physician who, three days later, on May 25, 1985; when advised by nurses on the 7 a.m. to 3 p.m. shift of large black and blue areas on the patient's inner groin area, indicated he examined the patient and found nothing new clinically on May 22. There are repeated instances of comments which Petitioner alleges were not properly reported to the physician. For example, on May 23, personnel on the 11 p.m. to 7 a.m. shift reflected that the patient "continues to be listless. Right leg turned at a funny angle. Report to D.O.N. (Director of Nursing)." The 7 a.m. to 3 p.m. shift the following morning reported, "Both legs ecchymosis (discolored), hip moves oddly, color pale." The 3 p.m. to 11 p.m. shift the same day reported, "Color remains pale-- unusual movement and rotation of both legs noted." Additional comments of a similar nature were noted by personnel on the 11 p.m. to 7 a.m. shift on May 24 the 3 p.m. to 11 p.m. shift on May 24; and the 11 p.m. to 7 a.m. shift which discovered the discoloration to the pelvis as reported previously. At 4 p.m. on May 25, 1985, personnel reported their concern in reference to the bruises on the patient's groin and lower extremities to the physician and further entries show that at 5:10 p.m., the patient was subsequently returned to the home at 7:30 p.m. after x-rays were accomplished which failed to reveal any fracture. Nonetheless, because of continued concern by the nursing staff and at the urging of family members, the patient was returned to the hospital at 10 a.m. on May 27, 1985. At this point, she was found to have fractures of both lower extremities and upon release from the hospital was transferred to another convalescent center. Mrs. McCasland contends that all due care and concern was given to the patient, M.C., consistent with the long standing convalescent center policy governing changes in patient status. This policy statement, dated March, 1975, which is still in effect, requires that "in the event of a significant change in the patient's physical, mental, or emotional status, the attending physician is immediately called by the charge nurse." As was stated in paragraph 3, above, on May 22, an 11 p.m. to 7 a.m.'s shift nurse noted a small bruise on the left foot of the patient and that the patient was listless. Small bruises are not necessarily significant in geriatric patients (M.C. was 88 years old). Also, often older people do not talk for several days. In any event, the lack of any significant condition was confirmed by the physician who found nothing unusual in the patient's condition during the examination. The doctor's report reflects, inter alia, "physical examination is remarkable for an elderly white female in an involuted state appearing her stated age." Her extremities "show some area of bruising primarily in the upper thighs presumably related to lifting the patient. She has crepitance in the bilateral knees and is unable to fully extend her lower extremities." Neurologically; she was determined to be alert and the physician recommended continuing general support of care. On May 25, 1985, the charge nurse called Ms. McCasland at home indicating that the patient's legs seemed to be getting bluer. Ms. McCasland, at that moment, told the nurse to call the patient's physician which was done and the doctor indicated at that time that when he had examined the patient several days previously, he found nothing wrong. It apparently was the decision of the doctor to take no further action at that time. However, at approximately 4 p.m.; after the conversation with the physician; the charge nurse contacted the physician again, indicating she thought the patient needed to be x-rayed. At 5:10 p.m.; the patient was taken to the hospital; apparently at the order of the physician; for x-rays which showed no fractures. Nonetheless; this action would not have been taken were it not for the attention of the nurse on duty and actions of the Respondent's administrator. On the following day, May 26, the charge nurse from the 7 a.m. to 3 p.m. shift again called Mrs. McCasland at home and stated that the patient's legs were; "bad." Ms. MeCasland told the nurse to call the patient's physician who directed she be sent to the hospital for x- rays. The hospital would not accept the patient and as a result, the physician came to the convalescent center where he examined her and concluded that there was, in fact, a problem. He directed she be sent to the hospital the following day and when she was x-rayed then; fractures were discovered. It should be noted here that again the contact with the physician which resulted in the ultimate diagnosis of leg fractures, was initiated by the charge nurse at Respondent's center and communicated to the physician and Ms. McCasland by center personnel.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that deficiency number NH77(g); relating to the visit to Respondent's convalescent center on August 28, 1985, be removed. DONE and ORDERED this 7th day of May, 1986, in Tallahassee, Florida. _ ARNOLD H. POLLOCK, Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway Tallahassee, Florida 32399 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 7th day of May, 1986.
Findings Of Fact Petitioner, Department of Health and Rehabilitative Services (HRS), is designated as the state agency responsible for the administration of federal and state Medicaid funds, and is authorized by statute to provide payments for medical services. Respondent, Marvin H. Ledbetter, is a doctor of osteopathy who is enrolled as a general practitioner provider in the Medicaid Program. His professional office is in Ormond Beach, Florida where he is engaged in family practice. Under the Program, Ledbetter is assigned a provider number (48220-0) which is used to bill Medicaid for services rendered to Medicaid recipients. During calendar year 1981, which is the only time period in question, Ledbetter received $42,809 in Medicaid reimbursements from HRS, of which $28,062 related to fees for Medicaid hospital patients. The latter category of fees is at issue. In order to qualify for federal matching Medicaid funds HRS must meet certain federally-imposed requirements, including the establishment of a program integrity section designed to insure that all Medicaid services are medically necessary. If they are not, HRS is obliged to seek recoupment of funds paid to the provider. This proceeding involves an attempt by HRS to recoup certain funds paid to Ledbetter for hospital services. After providing medical services to various hospital patients, Ledbetter completed and sent in the necessary forms to obtain payment. As noted earlier, these payments totaled $28,062 during 1981. Upon receipt of the forms, HRS input the information from the forms into a computer data base, along with similar information from other Medicaid providers throughout the State. This information included, among other things, the number of admissions, number of discharges, amount paid for hospital services and length of stay. The retention of such data is necessary so that possible overpayments may be detected by HRS through the statistical analysis of claims submitted by a group of providers of a given type. Because Ledbetter's total discharges exceeded the average of other family physicians throughout the State, the computer generated a report which flagged Ledbetter for further review and examination. An HRS analyst conducted such a review of Ledbetter's records, and found his average hospital length of stay for patients to be acceptable when compared to the average physician in the State. This report was forwarded to the HRS peer review coordinator who randomly selected thirty of Ledbetter's patients from the computer, and obtained their patient charts (numbering sixty-eight). Such a statistical calculation is authorized by Rule 10C-7.6(4)(b), Florida Administrative Code. A medical consultant employed by HRS then reviewed twelve of the sixty-eight charts and recommended the records be sent to a Peer Review Committee (PRC) for its review and recommendation. This committee is authorized by Rule 7C-7.61(4)(c), Florida Administrative Code serves under contract with HRS, and is composed of eight members of the Florida Osteopathic Medical Association. It is their responsibility to review the files of physicians whose Medicaid payments are questioned by HRS's program integrity section. When Ledbetter's records were forwarded to the PRC by HRS, the transmittal letter stated that a "study" of his records had been made, and that said study revealed "overutilization of inpatient hospital services" and "excessive lengths of stay." After a PRC review was conducted in early 1984, the records were returned to HRS with a notation that "mild overutilization" had occurred. According to informal guidelines used by the PRC, this meant that Ledbetter's overutilization fell within the range of 0 percent to 20 percent. HRS accepted these findings but for some reason initially determined that a 40 percent overutilization had occurred, and that Ledbetter was overpaid in 1981 by 40 percent for his hospital services. Finding this amount to be inconsistent with the mild overutilization guidelines, HRS arbitrarily added back two days to each patient's hospital stay, which decreased overutilization to 33.8 percent, or $9,505.06 in overpayments. By proposed agency action issued on May 18, 1984, it billed Ledbetter this amount, thereby precipitating the instant controversy. All of the patients in question were from the lower income category, and most were black. Their home conditions were generally less than desirable, and the ability of the parents to supply good nursing care to ill or sick children was in doubt. At the same time, in 1981 Ledbetter was working an average of 56 hours per week in the emergency room of a local hospital and devoted only minimal time to his family practice. Because of this Ledbetter's number of hospital admissions greatly exceeded the norm when compared to general practitioners who engaged in an office practice. Consequently, he received most of these patients through the emergency room rather than his office and was dealing with patients whose socioeconomic conditions were an important consideration. These factors must be taken into account in analyzing Ledbetter's patient records. HRS does not contend that Ledbetter failed to perform the services for which he was paid--rather, it questions only whether some of the admissions were medically necessary and whether some of the lengths of stay were too long. In this regard, conflicting expert testimony was offered by the parties concerning the amount of overutilization, if any. Expert testimony by two local doctors of osteopathy support a finding that only mild overutilization of admissions and lengths of stay occurred. This is corroborated by HRS's expert (Dr. Smith) and by the testimony of its "live" expert, Dr. Conn, who conceded that lengths of stay were only "a little bit too long." The more persuasive testimony also establishes that while mild overutilization falls within the range of 0 percent to 20 percent, 10 percent is an appropriate median in this proceeding. Using this yardstick, Ledbetter should reimburse HRS for 10 percent for his billings, or $2,806.20.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that respondent repay petitioner $2,086.20 in excess Medicaid payments received for calendar year 1981 claims. DONE and ORDERED this 16th day of May, 1985, in Tallahassee, Florida. DONALD R. ALEXANDER 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 16th day of May, 1985.
