The Issue Whether Petitioner timely notified Respondent, Division of State Group Insurance of a "qualifying status change" (QSC) event, so as to allow Petitioner to cancel her participation in the State Group Health Insurance Program during the Plan Year- 2006. Petitioner seeks a refund of amounts deducted/paid because her insurance was continued.
Findings Of Fact Petitioner has been a covered participant in the Program, authorized by Section 110.123, Florida Statutes, at all times material. As provided in Section 110.123(3)(c), Florida Statutes, Respondent DMS, through its administrative entity, DSGI, is responsible for contract management and day-to-day administration of the Program. DMS has contracted with Convergys, Inc., to provide human resources management services including assisting in the administration of the Program. Convergys performs these tasks in part through an on-line system known as "People First." However, as provided in Section 110.123(5), Florida Statutes, final decisions concerning the existence of coverage or covered benefits under the Program are not delegated, or deemed to have been delegated, by DMS. Section 110.161, Florida Statutes, requires DSGI, as the responsible administrative entity, to administer the Program consistent with Section 125 of the Internal Revenue Code, so that participants will obtain the pre-tax advantages provided by Section 125. One of the federal requirements to maintain the pre-tax status is that the plan's sponsor (e.g., the State of Florida) administer the plans and apply each plan's rules in a manner that does not discriminate and that treats all participants equally. In this case, Petitioner was enrolled in the Health Program Plan Year 2006, i.e. from January 1, 2006, through December 31, 2006. Allowing a Plan member to retroactively cancel her participation during a Plan Year without having properly reported a QSC could put the entire pre-tax program in jeopardy. A QSC is a change in status as listed in the Plan which would allow an employee to cancel or otherwise change participation in the Plan during the Plan Year if requested by the employee within 31 days of the change in status. Converting from full-time to part-time state employment is a QSC event. On April 21, 2006, Petitioner converted from full-time employee status to part-time employee status. Therefore, the QSC event in this case occurred on April 21, 2006, when Petitioner went from being a full-time to a part-time employee. However, in order to effect a change in health insurance coverage, Petitioner was required to request a change in health insurance coverage no later than May 22, 2006. To request a change in health insurance coverage, Petitioner would have needed to contact Convergys in a timely manner, i.e. within 31 days of April 21, 2006. For People First, Convergys maintains a tracking system known as "Siebel," which tracks written correspondence to or from state employees and notes telephone calls between state employees and Convergys associates. Standard business procedure for Convergys is that the telephone logs are not verbatim notations of the conversations, but are a summary of those conversations, including a description of the reason for the call and the action taken by any Convergys associate that took the call. The Convergys policy is that all calls are to be notated. All service associates are trained to note all calls. Convergys employees are trained to make the call notes during the telephone conversation or soon thereafter. A notation is to be made by the Convergys employee in the Siebel system, and a case is opened when the service representative cannot assist the caller or when further action is required. The case notes are also to be recorded in the system. None of the People First, DGS/DGSI, or Convergys records reflect any contact by Petitioner within the 31 days following April 21, 2006, although they reflect several later contacts concerning her complaint that her coverage was not timely cancelled. Petitioner testified that she used her sister's cell phone to telephone People First "after two or three weeks" and that she discussed cancellation of her participation in the state insurance program and flirted with the Black male who answered the phone, but who seemed not to have much experience in the cancellation process. Petitioner was not able to provide the name or position of the person with whom she allegedly spoke or the date or time of her telephone call. The fact that Petitioner testified that she knew that she "had to around the middle or so" of the month to request her change of coverage, illustrates Petitioner's rather loose interpretation of when this alleged call occurred. Petitioner presented no witness or documentation to corroborate her testimony that she had received oral assurances during that phone call to the effect that the change she requested had been completed through People First. Petitioner's representation that the telephone company could not get the phone records of this telephone call due to the passage of time is not credible.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Management Services enter a final order ratifying its October 13, 2006, denial of Petitioner's requested retroactive cancellation of enrollment in the State Group Health Insurance Plan. DONE AND ENTERED this 19th day of July, 2007, in Tallahassee, Leon County, Florida. S ELLA JANE P. DAVIS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 19th day of July, 2007. COPIES FURNISHED: Ericka L. Ledbetter 739 South Shelfer Stree Quincy, Florida 32351 Sonja P. Matthews, Esquire Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 John Brenneis, General Counsel Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950 John J. Matthews, Director Department of Management Services Division of State Group Insurance 4050 Esplanade Way Tallahassee, Florida 32399-0949
The Issue Whether Respondent has violated sections 627.6675, 626.9541(1)(a)1., 626.9541(1)(a)6., or 626.9541(1)(b), Florida Statutes, as pled in the Amended Notice and Order to Show Cause, and if so, what is the appropriate penalty.
Findings Of Fact The Office of Insurance Regulation of the Financial Services Commission (the Office) is responsible for enforcing the provisions of the Florida Insurance Code with respect to licensees of the Office. Guarantee Trust Life Insurance Company (GTL) is a foreign insurer, domiciled in Illinois, which holds a certificate of authority to transact business as a life and health insurer in Florida. GTL offers insurance products nationwide, except for New York, including Medicare long-term care, supplemental, cancer, college student, accident, and sickness policies. GTL is subject to the jurisdiction of the Office under the Florida Insurance Code, is subject to fines and disciplinary actions, and is substantially affected by the administrative complaint filed against it. On or about April 3, 2000, GTL entered into an agreement with Celtic Life Insurance Company. Celtic agreed to make medical expense conversion insurance available to eligible participants whose coverage under GTL group medical expense insurance was terminated. However, the agreement with Celtic specifically excluded coverage if GTL discontinued the group medical expense insurance plan in its entirety, or in a particular state. This exclusion was consistent with Celtic’s normal rules and both parties to the agreement knew of the exclusion. Any suggestion on the part of GTL that it was confused about Celtic’s obligations under this provision of the contract is not credible. A conversion policy is a form of replacement insurance coverage for which certificate holders in a group policy may be eligible when their coverage under a group policy is terminated. On or about June 21, 2006, GTL submitted filing number 06-08141, an out-of-state group major medical policy (Policy), to the Office. The letter transmitting the Policy to the Office noted that the Policy included a conversion provision and stated that GTL had a conversion policy available through Celtic Insurance Company. The letter did not state that the conversion policies to be provided by Celtic would not be available if coverage by GTL was terminated as part of its withdrawal from an individual market or state. The Policy provisions regarding conversion provided in relevant part: Health Insurance Conversion. A covered person may convert his or her health insurance coverage under the policy to another form of insurance issued by us if such insurance or any portion of it ends, provided the covered person is entitled to convert and within 63 days after such coverage ends the covered person: applies in writing to us at our home office; and, pays the first premium. We will provide the covered person the required notice within 14 days of the person informing us of their interest in making application for a conversion policy. No evidence of insurability will be required if the covered person converts under this provision. The effective date of the converted policy shall be the day following the termination of insurance under the policy. The Policy went on to define covered persons entitled to convert as those who had been covered continuously for at least 3 months prior to termination of the policy. The Policy set forth some exceptions. The Policy made no mention that GTL could contract with another insurer to issue the individual converted policy. A group health insurance product is issued to an association or employer. Individual certificates of health insurance are then issued to the members of the group. Under the Policy, forms were issued to Consumer Benefits Association of America. Certificates of health insurance coverage were then issued to at least 216 Florida residents who were members of the Consumer Benefits Association of America (Members) as evidence of their insurance under the Policy. These certificates advised Members of their conversion privilege in the event that coverage shown by the certificate was terminated, in language substantially identical to that in the Policy. The certificates met the statutory requirement for notification of the conversion privilege. The certificates of health insurance coverage made no mention that GTL could contract with another insurer to issue the individual converted policy. The Policy was never profitable for GTL. GTL instituted significant increases in the premium, but losses were still too high, and GTL made decisions to terminate the Group Plan and exit the Florida market entirely. On April 26, 2010, GTL notified the Office that it would be terminating all medical expense health insurance coverage in the individual market in Florida. The notice stated that the Uniform Termination of Coverage would affect 286 insureds in Florida. GTL was not required to file a copy of the letter (Termination Letter) that it planned to mail to Florida residents whose coverage would be terminated, but it did submit a copy to the Office. The Termination Letter was reviewed by Mr. Gary Edenfield, who at the time was a Senior Management Analyst Supervisor in the Division of Life and Health, Office of Forms and Rates. Mr. Edenfield requested that GTL make two changes to the Termination Letter: first, he asked that the reference to a 90-day notice be changed to say 180-day notice; and second, he asked GTL to include a reference to a website listing companies that could be contacted to provide individual replacement coverage on a guaranteed-issue basis. GTL made the requested changes to the Termination Letter and provided a revised copy to Mr. Edenfield, who then advised GTL that it had listed an incorrect website. Mr. Edenfield’s advice on each occasion was based upon his understanding that the policies involved were all individual major medical policies, because that was the way GTL had entered the filing in “I-File,” the Office’s electronic filing system. He was unaware at this time that the Termination Letter would be going to Members under the group Policy as well. On or about May 5, 2010, GTL sent the Termination Letter1/ to at least 216 Florida residents covered under the out-of-state group major medical Policy, as well as to about 70 Florida residents who held individual policies offered by GTL. The Termination Letter stated, in relevant part: 2. WILL GTL BE OFFERING A REPLACEMENT PLAN? At this time GTL will no longer be offering major medical type coverage. However, if you have 18 months of creditable coverage, you may be eligible for an individual major medical plan on a guaranteed issue basis. The Florida Department of Financial Website http://www.floir.com/CompanySearch/ provides a listing of companies that you may wish to contact to obtain replacement coverage. If you have any questions about the termination, you may contact Policy Owner Service at 1-800-338-7452. You may also contact the Florida Department of Financial Services, Division of Consumer Services at 1- 877-693-5236. A guaranteed-issue policy is a replacement insurance policy that insurers who are authorized to write individual medical coverage in Florida are required by statute to write for an individual whose group coverage has been terminated. A person who is entitled to a conversion policy is not eligible for a guaranteed-issue policy. There was no mention in the Termination Letter of any right to a conversion policy as a form of replacement coverage for the Policy being terminated. At the time it sent the Termination Letter, GTL knew that three-fourths of the recipients of the Termination Letter were holders of certificates of insurance coverage under the Policy. GTL knew that the Policy and these certificates granted a conversion privilege. GTL did not intend to offer a conversion policy to Members whose coverage under the Policy was being terminated. GTL knew it did not have coverage with Celtic to provide converted policies and could not offer the coverage itself. GTL knew the Termination Letter was misleading. On May 11, 2010, the Division of Consumer Services of the Department of Financial Services began receiving consumer complaints related to GTL’s non-renewal of health insurance and the Termination Letter. Mr. Edenfield received a call from the Division of Consumer Services stating that they did not believe GTL’s action was a termination of individual major medical policies. Mr. Edenfield called Mr. Allan Heindl, Vice President of Product Approval and Compliance at GTL. Mr. Heindl told him that the filing involved an out-of-state group major medical policy. Mr. Edenfield then advised Mr. Heindl that GTL was required to provide a conversion policy, and that GTL would need to send a new notice out informing Members that they were not entitled to a guaranteed-issue individual policy, but were entitled to a conversion policy. Mr. Heindl stated that he would have to “talk to his people” about that. In a follow-up letter sent by e-mail from the Office and received by GTL on May 20, 2010, the Office again advised GTL that it was required to provide conversion policies. The Office again advised GTL that it would be necessary for GTL to send the Members receiving the first letter a second one that explained that they were entitled to a conversion policy and not a guaranteed-issue policy from another company that issues individual policies. The Office did not set forth any period of time within which GTL needed to send the second letter. Mr. Heindl testified that at the time he received the May 20, 2010 letter, GTL disagreed with the Office about whether GTL was required to provide a conversion benefit. GTL and the Office sent a few e-mails back and forth in early June 2010, discussing whether GTL was required to offer conversion policies under Florida law. GTL continued to say it saw no such requirement in Florida Statutes; the Office continued to maintain that the statutes required it. Mr. Heindl noted that there would not be any conversion plan to offer because the statute required GTL to terminate and non-renew all individual health plans, since they were exiting the market. On or about September 21, 2010, Capital City Consulting, L.L.C., sent a letter to the Office indicating that GTL had reviewed the statutes cited by the Office and had concluded that GTL was not required to offer conversion policies. On September 22, 2010, the Office sent another e-mail advising GTL that it must comply with the conversion statute. On or about September 29, 2010, GTL sent a letter to the Office stating that after reviewing the September 22, 2010, e-mail from the Office and after their telephone call with Deputy Commissioner Mary Beth Senkewicz, they were unable to agree with the Office’s interpretation of the statutes and still believed their actions did not violate the Florida Insurance Code. GTL never sent a follow-up letter to Members as requested by the Office. GTL began terminating coverage under the Policy and certificates in November 2010, as renewal dates occurred after the 180-day notice provided in the Termination Letter sent in May. On January 12, 2011, the Office served GTL with a Notice and Order to Show Cause alleging that GTL had violated the Florida Insurance Code by continuing to non-renew policies and failing to offer converted policies. On January 28, 2011, GTL filed a Petition for Administrative Hearing with the Office. It amended that Petition on February 1, 2011, still maintaining that it was not required to offer conversion policies. In February or March, 2011, GTL began negotiations for an agreement with Celtic to provide the conversion benefit described in the Policy and certificates arising from GTL’s exit from the Florida market. On April 5, 2011, in response to a March 17, 2011, inquiry from Celtic as to the number of covered lives remaining, Mr. Heindl advised in part, “The size of the group in FL at the time of termination was 286 and today we have 28 left. I’m not sure if FL would make us go back and offer coverage to all previously insured insured’s. If FL does, I can’t imagine many would come back to GTL.” Discussions between GTL and Celtic continued in April and May. GTL reached an “understanding” with Celtic in May that Celtic would provide conversion coverage. The understanding was that if GTL sent notification to all terminated insureds informing them of the conversion available from Celtic, then GTL would pay an initial transaction fee of $125,000 to Celtic, due when the agreement was entered into, along with the sum of $30,000 per policy for each conversion policy subsequently issued by Celtic. If Celtic did not send out a notice to the terminated insureds, then the initial transaction fee would be reduced to $100,000. At the time the understanding was reached, only 28 or fewer Members were left; there was no understanding in place when the coverage of at least 188 Members was terminated. No written contract incorporating this understanding was ever entered into with Celtic. GTL did not send out a notice to the terminated Members. The initial transaction fee was never paid. Mr. Heindl testified at hearing that if a Member had come forward and actually applied for conversion, GTL would then have moved forward and paid the agreed-upon fees. No Member requested information about a conversion policy. GTL chose not to send any notice to terminated Members in an effort to eliminate or minimize the possibility that Members might request conversion policies, and so avoid the costs of contracting with Celtic to provide the conversion coverage. GTL was hoping that the Members were unaware of their conversion rights, and would not become aware of them. At no time from the inception of the Policy and the certificates based thereon, through the time the Termination Letters were sent, until the time of the Final Hearing in this case, did GTL have in effect any written contract with Celtic or any other insurer to issue converted policies to Members upon GTL’s termination of the Policy group coverage in its entirety, or in the State of Florida. On August 26, 2011, Mr. Heindl, party representative for GTL, conceded under oath in deposition that the Policy was an out- of-state group policy and that sections 627.6515 and 627.6675, Florida Statutes (2010),2/ did apply to the Policy. On September 2, 2011, an Order was issued granting the Office’s Unopposed Motion to Amend Notice and Order to Show Cause. Counts I and II of the earlier complaint were amended. The earlier complaint had charged in these counts that “Guarantee Trust violated the Florida Insurance Code by failing to offer converted policies as required by Section 627.6675, Florida Statutes.” As amended, Counts I and II alleged that “Guarantee Trust violated the Florida Insurance Code by issuing the Termination Letter without offering converted policies required by the Florida Insurance Code and Section 627.6675, Florida Statutes.” The word “offer” or “offering” is not defined in the Florida Insurance Code. These terms are used in dozens of places throughout the Code, however, in phrases such as “insurers to offer coverage,” “offers policies or certificates,” “licensees offering policies,” and “offering insurance,” all in the context of describing insurance lines and products being made available in the market by an insurer. GTL itself used these words in similar contexts. In its September 21, 2010, letter to the Office, GTL stated “GTL is not required to offer conversion policies.” In later e-mails to Celtic, GTL referred to “offering a conversion option” and “make us go back and offer coverage.” In the Termination Letter itself, GTL wrote, “GTL will no longer be offering major medical type coverage.” GTL could not reasonably have interpreted the phrase “without offering converted policies” in Counts I and II as referring only to notification to Members. GTL was well aware that Counts I and II were alleging that GTL’s issuance of the Termination Letter constituted a revocation of GTL’s contractual and statutory responsibility to make conversion insurance available to Members at a point in time at which GTL did not have a written contract in place with any carrier to provide such conversion policies. GTL was not hindered in its ability to prepare a defense to Counts I and II. The Office showed by clear and convincing evidence that at the time GTL issued the Termination Letter, GTL did not have a contract with another insurer to provide conversion policies upon GTL’s exit from the Florida market, and would be unable to do so itself. The Amended Notice and Order to Show Cause of September 2, 2011, also added three new counts, alleging that the Termination Letter sent out to covered persons constituted an unfair insurance trade practice under the Florida Insurance Code because it was misrepresentative, deceptive, and misleading. The statement in the Termination Letter that GTL would no longer be offering major medical coverage was not a false statement. GTL was withdrawing entirely from the Florida market and would not itself be offering any coverage, including individual conversion policies. Although technically true, the statement was nevertheless likely to mislead a reasonable Member, because it made no mention that GTL was legally required to arrange for another provider to offer the conversion policy on GTL’s behalf. The statement that GTL would no longer be offering major medical type coverage, omitting any further information, would leave the incorrect impression with a reasonable Member that the right to a conversion policy upon termination, as set forth in the certificate of health insurance, no longer existed. GTL knew that this statement was misleading as to a reasonable Member. Similarly, the statement in the Termination Letter that “you may be eligible” for an individual major medical plan on a guaranteed issue basis was not a false statement. The statement did not say that any reader “was” entitled to such a policy, only that they “may” be. Again, while not technically false, this statement was likely to mislead a reasonable Member, for none of these individuals was in fact eligible for a guaranteed-issue policy. GTL could easily have distinguished between Members and its individual policy holders in the letter, or better yet, sent two different letters, but it failed to do so. GTL instead chose to say only that readers “may be eligible” for a guaranteed issue policy and to include the reference to the Department’s website list of other companies, without any mention of the converted policy available to a majority of recipients of the letter. This omission was likely to leave a reasonable Member eligible for a conversion policy with the incorrect impression that this right no longer existed. GTL knew that this statement was misleading. Even the second question asked in the Termination Letter was misleading. The question posed by GTL, “WILL GTL BE OFFERING A REPLACEMENT PLAN?” was followed by true statements, but it was not the right question. Certificate holders would be interested in knowing what coverage might be available to them from any source to replace the terminated coverage, not simply coverage from GTL itself. Again, reasonable Members would likely be left with the impression that a conversion policy was no longer available to them because GTL was exiting the Florida market. GTL knew that posing the question in this fashion was misleading. On November 15, 2011, GTL filed a Petition to Challenge Unadopted Rule. The Petition was served on the Office more than 30 days before it was filed with the Division of Administrative Hearings, as stipulated at hearing. The Financial Services Commission has not adopted the statement that it is a violation of provisions of the Florida Insurance Code to “issue a termination letter without offering converted policies as required by Section 627.6675,” or any similar statement, by rulemaking procedures. The Office proved by clear and convincing evidence that Celtic was never required to provide conversion policies if the termination of the Policy was a result of a decision to discontinue major medical coverage in Florida. It similarly proved that no other contract providing conversion policies under these circumstances was ever entered into with Celtic or any other insurer, and that GTL could not itself provide conversion coverage. The Office proved by clear and convincing evidence that GTL knowingly made, issued, published, disseminated, circulated, and placed before the public the Termination Letter. The Office failed to prove by clear and convincing evidence that any statement in the Termination Letter was false. The Office proved by clear and convincing evidence that statements in the Termination Letter were made for the purpose of inducing, and tended to induce, the forfeiture of the conversion policy to which the Members were entitled under the Policy. The Office proved by clear and convincing evidence that the Termination Letter contained an assertion, representation and statement with respect to the business of insurance that was willfully deceptive and misleading. GTL knew, or should have known, that this was an unfair or deceptive act or practice under the Florida Insurance Code.
Recommendation Upon consideration of the above findings of fact and conclusions of law, it is RECOMMENDED: That the Office of Insurance Regulation enter a Final Order finding that Guarantee Trust Life Insurance Company committed 216 knowing and willful violations of subsection 626.9521(1), Florida Statutes, for engaging in an unfair method of competition and unfair or deceptive act or practice as defined in subsection 626.9541(1)(b), Florida Statutes, and imposing a fine of $1,000 for each such violation, for a total fine not to exceed an aggregate amount of $200,000. DONE AND ENTERED this 16th day of March, 2012, in Tallahassee, Leon County, Florida. S F. SCOTT BOYD 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 16th day of March, 2012.
Findings Of Fact Respondent administers the State of Florida Employees' Group Health Self Insurance Plan as a self insurance plan pursuant to Section 110.123(5), Florida Statutes. Prior to October 1 1981, Petitioner was an employee of the Department of Natural Resources. For some period of time, Petitioner purchased coverage under that health insurance plan. When she married an employee of the federal postal service, she dropped her health insurance with the State of Florida, since she preferred health insurance coverage under her husband's Policy with the federal government. Petitioner's employment with the Department of Natural Resources was reclassified so that she became a member of the Senior Management Service during September or October 1981. One of the benefits available to Senior Management Service employees is coverage under the State of Florida Employees' Group Health Self Insurance Plan free of charge to the employee. In the case of a Senior Management Service employee who accepts coverage under that Plan, the employing agency pays the full premium cost for the employee. On September 18, 1981, Ginger Bailey, an employee in the personnel office of the Department of Natural Resources, typed in the required information on insurance application forms for the various insurance policies available to Petitioner when her Senior Management status became effective on October 1, 1981. Bailey took the application forms to Petitioner, who was too busy at the time to discuss with Bailey the different insurance policies available and the forms themselves. Bailey left the forms with Petitioner. On October 8, 1981, Petitioner went to the personnel office so that Bailey could review with her the insurance benefits available to Senior Management status employees. Bailey explained each available insurance policy to the Petitioner individually and, for each, offered Petitioner an application form already completed by her. Petitioner accepted the offer of State-paid life insurance and disability insurance by signing the application form for such insurance in the acceptance block. When Bailey explained to Petitioner the health insurance, Petitioner commented that she would not need the insurance because her husband's policy was so good. Accordingly, Bailey directed Petitioner's attention to the portion of the application marked in bold letters, "Refusal." Petitioner signed the refusal portion of the application and dated her signature. Bailey struck through the September 18, 1981, date she had previously filled in for Petitioner in the acceptance section of the application. At no time did Bailey or any other agent or employee of the Department of Natural Resources or of the Department of Administration represent or state to Petitioner that she was covered by or was a member of the State of Florida Employees' Group Health Self Insurance Plan. In June 1982, Petitioner obtained a copy of the State of Florida Employees' Group Health Self Insurance Booklet containing an explanation of benefits effective July 1, 1982. On a sheet of paper, Petitioner typed the name of the Plan, the name and address of the administrator of the Plan, the group number, and the policy number. She taped this slip of paper to the front of the Booklet. During the month of June 1982, Petitioner's husband's 20-year-old daughter was admitted to a hospital. Petitioner showed hospital employees the health insurance explanation Booklet with the information she had placed on the front of it, since she could not "find" her insurance card, and the hospital accepted Petitioner's representations as proof of insurance. Coverage for Petitioner's stepdaughter was no longer available on Petitioner's husband's insurance policy, since she was over 19 years of age. Petitioner submitted a claim form to Blue Cross and Blue Shield of Florida, Inc., the administrator of the State of Florida Employees' Group Health Self Insurance Plan. The claim submitted by Petitioner to the Plan was rejected for lack of coverage. No evidence was presented as to whether a Senior Management Service employee's family members receive free coverage under the State's health insurance plan, and no evidence was presented as to whether Petitioner had any legal or financial responsibility for her adult stepdaughter.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered denying Petitioner's request that she be deemed covered by the State of Florida Employees' Group Health Self Insurance Plan from and after October 1, 1981, without prejudice to the Petitioner's right to apply, if she desires, for prospective coverage under the Plan in accordance with the Plan's requirements, rules and regulations. DONE and RECOMMENDED this 25th day of April, 1983, in Tallahassee, Leon County, Florida. LINDA M. RIGOT, 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 25th day of April, 1983. COPIES FURNISHED: Ms. Mary L. Davis Post Office Box 753 Havana, Florida 32333 Kevin X. Crowley, Esquire Department of Natural Resources Douglas Building, Suite 1003 3900 Commonwealth Boulevard Tallahassee, Florida 32303 Daniel C. Brown, Esquire Department of Administration 435 Carlton Building Tallahassee, Florida 32301 Nevin G. Smith, Secretary Department of Administration 530 Carlton Building Tallahassee, Florida 32301
Findings Of Fact Aurelio Durana has been employed with the Department of Administration continuously since 1979. He enrolled in the State of Florida Employees' Group Health Self-Insurance Plan before the period in dispute and had maintained individual coverage until August 1, 1980. Alina Durana, Petitioner's spouse, was employed by the Department of State from 1977 until her resignation on March 9, 1981. From September 9, 1980, through March 9, 1981, Alina Durana was on maternity leave without pay from her position at the Department of State. This maternity leave expired March 9, 1981 (Exhibit 2). Alina Durana had enrolled in the Group Health Insurance Plan from the beginning of her employment and maintained individual coverage until August 1, 1980. Effective August 1, 1980, Petitioner and his spouse elected family coverage, entitling them to a State contribution covering the entire premium. On Application for Multiple Contributions dated 1 July 1980 (Exhibit 8), Petitioner agreed to be responsible for any underpayment of premium resulting from his wife's ineligibility for a State contribution and agreed that any such underpayment should be deducted from any salary due him. Under the State Health Insurance program the agency for whom the employee worked contributes one-half of the family premium of $69.96 per month. Since both Petitioner and his wife were working for the State, each agency contributed $34.98 per month, thereby covering the entire premium. The agencies contribute this sum to the trust fund from which medical claims of employees are paid. When an employee ceases to be on the agency's payroll the agency stops this contribution to the fund and is supposed to notify the Department of Administration so pay adjustments to employees' pay can be made if necessary. When Mrs. Durana commenced her leave without pay on September 9, 1980, the Department of State failed to notify the Department of Administration that they were no longer contributing $34.98 per month to the Durana family health plan. Had they done so, the Department of Administration would have notified Durana that he would have $34.98 deducted from his pay each month if he desired to remain in the program. In September 1981 Petitioner notified the Department of Administration Personnel Office that health insurance premiums were not being deducted from his pay. Thereafter, Respondent learned of the departure of Mrs. Durana from the Department of State payroll in September 1980 and made claim against Durana for $316.14 for underpayment of premiums from the period the Department of State had not contributed to the fund and no premiums were paid by Petitioner. During the period Mrs. Durana was not on the payroll and the Department of State was contributing nothing to the trust fund, no claims were submitted by Durana for medical costs. However, during this period Petitioner was included in the list of beneficiaries of the State Health Insurance Plan and medical bills submitted by him would have been paid by the administrator of the trust fund.
The Issue The issue for consideration in this hearing was whether Petitioner was entitled to insurance coverage reimbursement for items claimed as a result of his son's hospitalization at a specialty hospital in April, 1989.
Findings Of Fact At all times pertinent to the issues herein, Petitioner, Claud E. Leiby, was employed by the State of Florida and was a member of the State Group Health Self Insurance Plan. The State of Florida, Department of Administration, Division of State Employees' Insurance, is the state agency responsible for administering the Group Health Self Insurance Plan in Florida. On April 5, 1989, Petitioner's son, Floyd (Chris), attempted to take his own life. Chris is hearing impaired. He is a 22 year old who was, at the time, six months away from earning his Bachelor of Science degree in Computer Engineering Technology at Tampa Technical Institute. Prior to this suicide attempt in April, 1989, Chris had been seen by a psychologist who referred him to a psychiatrist. Chris had previously been seen by a psychiatrist for a drug abuse problem several years before. Approximately two years ago, Chris was admitted to Palms Hospital in Sarasota, an institution covered by the insurance plan in issue. At that time, the hospital represented it would provide an interpreter for the deaf and those other specialized personnel necessary for appropriate treatment of a hearing impaired individual. However, after several days of treatment which were singularly non-beneficial because of the fact that no interpreter was provided and Chris could not lip read, the treatment was terminated and Chris was discharged. The Leibys felt, based on that experience, that appropriate service could or would not be provided at a facility covered by the plan, and as a result, when Chris attempted to take his life on April 5, 1989, did not even attempt to hospitalize him in either of the covered facilities in Sarasota County, Sarasota Palms Hospital or Sarasota Memorial Hospital. Instead, they had him admitted to Horizon Hospital in Sarasota, a psychiatric specialty hospital which is the only hospital in the area providing a program for the psychiatric treatment of the hearing impaired even though they had been advised such treatment would not be covered. Their conclusion as to the lack of availability of other qualified treatment may not have been accurate, however. Dr. Curran, director of mental health services at Memorial indicated that facility could and would provide adequate treatment for the hearing impaired. This is inconsistent with the Petitioner's prior experience. The Leibys felt that due to the suicidal attempt, the situation constituted an immediate crisis. However, after several days of Chris' hospitalization at Horizon, they were advised that their coverage under the state plan would not cover the incurred expenses at that facility. The Plan administrator indicated the Petitioners were not covered because of the terms of the plan which exclude services and supplies provided by a specialty institution. Further, the Division took the position that since Chris attempted to take his own life, and since the plan excludes coverage for services and supplies resulting from an intentional self-inflicted injury, it was "unlikely" reimbursement would be made even if Chris had been admitted to one of the eligible hospitals. Petitioner claims that the Division's interpretation of the rule and the plan provisions constitutes a form of discrimination against the handicapped which is prohibited by federal and state law. After Chris was discharged from Horizon Hospital, he had another episode while at work and was taken to a medical facility in St. Petersburg. After four days, he was released and taken to see Dr. Douglas R. Elliott, a psychiatrist, who was unable to treat him successfully without the services of an interpreter. Dr. Elliott indicated that Ms. Leiby, who acted as an interpreter on the first session, could not continue to act in that capacity, considering the issues that needed to be addressed. In the doctor's opinion, the treatment Chris received at Horizon was both necessary and beneficial. The Plan brochure provided to state employees contains numerous provisions pertinent to this hearing. On Page 3, the definition of a hospital specifically includes a "specialty institution" and at page 9, the section on Limitations (on coverage) indicates, "Payment for inpatient services rendered by a hospital and/or specialty institution while confined for alcoholism or drug addiction, and/or rendered by a hospital while confined for alcohol or drug addiction or mental or nervous conditions, shall be made for not more than thirty-one (31) days of confinement during a calendar year. Specialty institutions are, in the Summary of Benefits section found on Page 6, identified as being permitted for alcohol/drug impaired employees only. In the Exclusions portion, found on pages 11 and 12, services and supplies provided by a specialty institution or residential facility (with the exception of the alcohol/drug treatment for employees) are excluded as are services and supplies provided by a skilled nursing facility for the treatment of an insured for alcoholism, drug addiction, (other than for employees), or mental or nervous conditions. The Plan Benefit Document itself, which was not previously provided to Petitioner, at page 24, defines a "specialty institution" as a "licensed facility providing an inpatient rehabilitation program for the treatment of persons suffering from alcohol or drug abuse or mental or nervous conditions." At Section VII L, dealing with Exclusions, "...services and supplies provided by a specialty institution, except as provided under Section II G, (treatment relating to alcoholism or drug addiction for the employee only), are excluded from coverage." The Division has defined these terms as meaning, in substance, that a specialty institution is specifically excluded except when a covered employee asks approval for entry into such an institution for alcohol or drug addiction. Otherwise, they have been excluded since implementation of the plan in 1972, because of cost. If these institutions were to be included, the additional costs would, according to Mr. Seaton, mean premium rates to the participants would have to be increased. The benefit document, as it exists, was constructed with the assistance of Blue Cross/Blue Shield and other consultants. It was the intent of the Department to provide services that a majority of the employees and their families need. To change the benefit document requires legislative approval. The plan is not intended to deny coverage to the handicapped. An "appropriate" service was available to Chris at the time of his admission to Horizon Hospital in April, 1989 under the state plan. Further, in Mr. Seaton's opinion, since the injury was self-inflicted, even if Chris had been admitted to an eligible hospital, coverage would not have been available. This latter position is unsupportable as an improper interpretation of the relevant provision. To insure cost reimbursement, Petitioner would have had to have a physician admit Chris to an acute care hospital such as Palms or Memorial, and in that case, according to Seaton, the state would have allowed up to 31 days of inpatient service. Seaton indicates that Section 504 of The Rehabilitation Act of 1973, was not considered in determining benefits to be covered. In his opinion, the "majority of employee needs" were covered and handicapped employees are covered to the same degree as non-handicapped employees. Family coverage for an employee does not include provisions to cover special needs of family members. Since treatment for handicapped is covered as a matter of course, no need was seen to make specific provision for handicapped individuals. The limitations, exclusions, or benefits provided are the same for all members and are provided to the handicapped to the same extent as to the non-handicapped. When asked if the patient had been initially admitted to a general hospital and thereafter referred to a specialty hospital as a matter of appropriate medical treatment by a covered provider, would that specialty admission be covered, Mr. Seaton replied, "absolutely not."
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that the Petition for reimbursement for Chris' hospitalization at Horizon Hospital be denied. RECOMMENDED this 24th day of October, 1989, in Tallahassee, Florida. ARNOLD H. POLLOCK, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 24th day of October, 1989. APPENDIX TO RECOMMENDED ORDER, CASE NO. 89-4186 The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes on all of the Proposed Findings of Fact submitted by the parties to this case. None submitted by Petitioner: For the Respondent: 1.-5. Accepted and incorporated herein. 6.-7. Accepted and incorporated herein. Accepted. Accepted. Petitioner submitted the hospital bill subsequent to the hearing and after both parties had rested. Respondent moved to strike this evidence but the motion was denied. The amount of the hospital bill is now known, but in light of the Findings and Conclusions is not relevant. Accepted and incorporated herein. Accepted and incorporated herein. Accepted except for last sentence. Petitioner's opinion is based on prior experience. Accepted. This is opinion only. Not a Finding of Fact but a restatement of testimony. The substance of the testimony is accepted, however. Accepted and incorporated herein. 16.-18. Accepted and incorporated herein. 19. Accepted as to lack of discrimination. COPIES FURNISHED: Claude E. Leiby 321 East Lake Drive Sarasota, Florida 34232 Augustus D. Aikens, Jr., Esquire Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550 A. J. McMullian, III Interim Secretary Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550
The Issue The basic issue in this case concerns the scope of the coverage provided by the State of Florida Employees Group Health Self Insurance Plan ("State Plan"). The Petitioner incurred extensive expenses for medical treatment, some of which have been paid by the State Plan. The Petitioner contends that under the State Plan, specifically under the "extended coverage" portion of the State Plan, she is entitled to more than has already been paid. The Respondent contends that the correct amount has already been paid.
Findings Of Fact The State of Florida makes available to its officers and employees several group insurance programs. With regard to group health insurance, the available programs include the State of Florida Employees Group Health Self Insurance Plan ("State Plan") and a number of different HMO's, depending upon the county in which an employee resides. Upon commencement of employment, State employees may elect to participate in the State Plan, may elect to join one of the HMO's in their geographical region, or may elect not to participate in any of the voluntary group insurance programs offered by the State. Employees who choose to participate in the State Plan are charged a premium which is normally deducted from their paychecks. The State also contributes regular amounts to pay a portion of the premium for each participating employee. Roberta Rubin has been an employee of the State of Florida for twelve years. She is currently employed as a judicial assistant to Circuit Court Judge George Orr. Roberta Rubin is an insured under the State of Florida Employees Group Health Self Insurance Plan ("State Plan"). The basic terms and conditions of the State Plan are set forth in a document titled State of Florida Employees Group Health Self Insurance Plan Benefit Document ("Benefit Document"). The version of the Benefit Document applicable to this case is the version amended effective July 1, 1988. The Department of Administration, Division of State Employees' Insurance, distributes a brochure titled Group Health Self Insurance Plan Benefits which describes the benefits under the State Plan and is intended to assist State employees in deciding which health insurance plan to select. The Department of Administration, Division of State Employees' Insurance, also distributes a brochure titled Group Health Self Insurance Plan Brochure ("Plan Brochure") to individuals enrolled for coverage under the State Plan. At page 1, the Plan Brochure describes the State Plan as follows: "This is a self-insured group health insurance program belonging to those State officers, employees, retirees, and their eligible dependents who elect to participate in the Plan." At the first unnumbered page inside the front cover of the Plan Brochure is a statement of the brochure's purpose, which includes the following: This brochure is not a contract since it does not include all of the provisions, definitions, benefits, exclusions and limitations of the State Self Insured Health Plan's Benefit Document, a copy of which is on file in your agency's personnel office. The purpose of this brochure is to furnish State officers and employees with a summary of the benefits available under the State Self Insured Health Plan. It is hoped that this brochure will answer any questions that might arise about the Plan. The State of Florida Employees Group Health Self Insurance Plan is administered by Blue Cross Blue Shield of Florida, Inc. In December of 1990, the Petitioner, Roberta Rubin, was diagnosed as having cervical cancer. The prognosis and recommended treatment provided by her treating physicians in Miami were not acceptable to Petitioner and she sought another opinion. Petitioner was referred to and ultimately treated by Dr. Neil Rosenshein, a gynecological oncologist at Johns Hopkins Hospital in Baltimore, Maryland. Dr. Rosenshein and Johns Hopkins Hospital are both "non-preferred patient care providers" within the meaning of the definitions in the Benefit Document. Dr. Rosenshein performed the following surgical procedures: radical abdominal hysterectomy; radical pelvic node dissection; bilateral commoniliac node dissection; and periaortic node dissection. The Physician's Procedural Terminology published by the American Medical Association ("PPT Code Book") assigns procedure codes to various surgical procedures that are utilized by billing physicians and various insurers. The PPT Code Book does not contain procedure codes that accurately reflect the latest technology or the complexity, intricacy, or radical nature of the procedures being performed in gynecological cancer surgery. Since no single or multiple procedure codes accurately characterized the surgical procedures performed by Dr. Rosenshein, his bill was submitted to Blue Cross Blue Shield of Florida, Inc., reflecting only one procedure code, 58210, with amodifier, "-22." The modifier "-22" is described in the 1986 version of the Approved Fee Schedule, of the State Plan, as follows: -22 UNUSUAL SERVICES: WHEN THE SERVICES PROVIDED ARE GREATER THAN THOSE USUALLY REQUIRED FOR THE LISTED PROCEDURE, IDENTIFY BY ADDING THIS MODIFIER -22 TO THE USUAL PROCEDURE NUMBER. LIST MODIFIED VALUE. REPORT MAY BE REQUIRED. However, the Benefit Document, as amended effective July 1, 1988, does not provide for or allow the use of the modifier "-22" in determining the amount of payment due on a claim even when the services provided are greater than those usually required for the listed procedure. The modifier "-22" is used by Blue Cross Blue Shield in the administration of other group health insurance plans. The claim form submitted by Dr. Rosenshein went through a level three review by Blue Cross Blue Shield of Florida, Inc., and in response to a request for additional information, Dr. Rosenshein submitted a letter explaining the nature of the procedures performed and a copy of the operative report. Following its review, Blue Cross Blue Shield of Florida, Inc., allowed payment only for the approved fee schedule amount for a single procedure code 58210, or $3,726.00. Dr. Rosenshein's uncontradicted testimony established that the most accurate representation of the procedures he performed would require the following three procedure codes: Code # Description 58210 limited periaortic lymphadenectomy 49201 extensive excision or destruction by any method of intra-abdominal retroperitoneal tumors or cysts or endometriomas 38780 retroperitoneal transabdominal lymphade- nectomy, extensive, including pelvic, aortic and renal nodes. The approved fee schedule for these procedure codes allows the following amounts: Code # Amounts 58210 $3,726.00 49201 2,683.00 38780 2,764.00 Petitioner has incurred the following bills in 1991 which are in excess of the applicable deductible and $1,500.00 out-of-pocket amount provided for under the Extended Coverage provisions of the benefit Document: Provider Amount JHU Department of Radiology $ 159.30 JHU Pain Management Anesthesia 698.10 JHU Anesthesiology 507.70 John Hopkins Hospital Outpatient 50.00 JHU Department of Oncology 503.50 JHU Cardiology 90.00 JHU Pathology 230.00 Dr. Neil Rosenshein 9,904.50 Total $12,143.10 The amounts reflected above are exclusive of benefits already paid by Blue Cross Blue Shield of Florida, Inc., and other insurers and do not include any charges for room and board services or ambulance services. Section I of the Benefit Document contains definitions of numerous terms, including the following: D. "AFS" means the "Approved Fee Schedule," as approved or amended by the Department of Administration. "Covered provider" shall mean a person, institution, or facility as defined herein and who furnishes a covered service or supply. "Covered service or supply" shall mean a medically necessary service or supply furnished by a covered provider and which is covered by the Plan. Q. "Deductible" shall mean the dollar amount of covered services and supplies which each insured is required to pay before benefits are payable by the Plan. BA. "Preferred Patient Care Fee Schedule" or "PPC Fee Schedule" means a list of allowances for each service which has been set and agreed to by the preferred patient care providers. BB. "Preferred Patient Care Provider" or "PPC Provider" means a physician or hospital which has an agreement with the Administrator to provide health care services at set fees to individuals insured under the Plan. A non-preferred patient care provider does not have such an agreement. BJ. "Reasonable Charge" shall mean the following: an average of the amounts charged by the non-preferred patient care hospital, skilled nursing facility, hospice facility or birth center facility for services to individuals using such hospital or facility, as determined by the Administrator; or the charge set forth in the AFS for covered medical-surgical services. BS. "Usual, Customary and Reasonable" or "UCR" means a schedule of fees for covered services in a geographical area which is determined by the Administrator based upon the normal amount charged by the provider in his/her practice, (b) the range of fees for most providers in an area for the same service, and (c) any unusual circumstances or complications requiring additional time, skills and experience by the provider which can be documented. Section II of the Benefit Document contains the provisions regarding coverage for hospital and other facility services. That section reads as follows, in pertinent part: The following services shall be covered when ordered by a physician a nd are medically necessary for the treatment of an insured as a result of a covered accident or illness. Non-Preferred Patient Care Hospital Inpatient Room and Board Services: 1. When confined to a semi-private or private room or ward, 80% of the hospital's average semi-private room rate shall be paid but not to exceed an actual payment of one- hundred and fifty-two ($152.00) per day. Other Covered Non-Preferred Patient Care Inpatient Services: 80% of the actual charge for the following services will be paid by the Plan: Use of operating room, labor room, delivery room and recovery room; All drugs and medicines used by the patient while confined in the hospital, provided such drugs and medicines are listed in "New and Non-Official Remedies" or the "United States Pharmacopoeia"; Solutions (including glucose); Dressings; Anesthesia and related supplies; Oxygen therapy; Transfusion supplies and services including blood, blood plasma and serum albumin, if not replaced; Laboratory services; Electrocardiograms; Basal metabolism examinations; X-ray, including therapy; Electroencephalograms; Diathermy and physical therapy. Covered Outpatient Hospital, Ambulatory Surgical Center or Outpatient Health Care Facility Services: Ninety percent (90%) of the reasonable charge shall be paid for covered outpatient services provided by a Non-PPC provider. When such services are provided by a PPC provider, the plan shall pay ninety percent (90%) of the charge subject to the PPC fee schedule limits. Covered Clinical Laboratory Services: Ninety percent (90%) of the charge for covered clinical laboratory services shall be paid by the Plan not to exceed the maximum amount permitted under the AFS. Section III of the Benefit Document contains the provisions regarding coverage for medical-surgical services. That section reads as follows, in pertinent part: A. Ninety percent (90%) of the charge for medically necessary inpatient/outpatient services provided to an insured by a non- preferred patient care physician, physical therapist or nurse anesthetist for the treatment of the insured as a result of a covered accident or illness shall be paid by the Plan, subject to the provisions of Section VI and Section XXIII; however, such payment shall not exceed the maximum amount permitted under the AFS. C. If a covered procedure does not have a specified fee listed in the AFS, pricing will be performed by the Administrator in accordance with its normal procedures. Section V of the Benefit Document, titled "Extended Coverage," contains the provisions regarding what is commonly known as the "stop loss" feature of the plan. That section reads as follows, in pertinent part: If under individual or family coverage, the out-of-pocket expenses of an insured for covered services under Section II., Section III., Section IV and Section XXV amount to one thousand five hundred dollars ($1500.00) during a calendar year, all further covered charges for such services incurred by the insured during the remainder of the calendar year shall be paid by the Plan at one hundred percent (100%), subject to the lifetime maximum and the maximum payments listed in paragraph C. below. If under family coverage, the out-of- pocket expenses of two or more insureds for covered services under Section II., Section III., Section IV. and Section XXV. amount to three thousand dollars ($3000.00) during a calendar year, all further covered charges for such services incurred by any insured during the remainder of the calendar year shall be paid at one hundred percent (100%), subject to the lifetime maximum and the maximum payments listed in paragraph C. below. Maximum payments subject to Subsections A. and B. above shall apply only to room and board services under Subsection II A., Subsection II E., Subsection II G., and ambulance services under Section IV, as follows: One hundred and ninety dollars ($190.00) per day for hospital room and board; Ninety-five dollars ($95.00) per day for room and board in a skilled nursing facility; Three hundred and eighty dollars ($380.00) per day for an intensive care unit; Two hundred and eighty-five dollars ($285.00) per day for a progressive care unit; One hundred and twenty-five dollars ($125.00) per use for ambulance service; One thousand dollars ($1000.00) for ambulance transportation of a newborn child; One hundred and ninety dollars ($190) per day for room and board in a specialty institution or residential facility. Charges for covered services and supplies applicable to the deductible(s) under the Plan shall not be considered an out-of-pocket expense under the provisions of Section V. The brochure titled Group Health Self Insurance Plan Brochure contains the following language at page seven regarding the stop loss feature of the plan: Maximum Out-Of-Pocket Expense If, during a calendar year, the out-of-pocket expenses for one person insured under individual or family coverage amount to $1,500, or $3,000 for two or more persons insured under family coverage, all further charges will be paid at 100%, subject to the lifetime maximum, any allowance limits for room and board while confined to Non-PPC facilities, and ambulance transportation allowance limits for newborn children. This provision applies to all covered services except Hospice services; however, charges applicable to the deductible shall not be considered an out-of-pocket expense. The language of Section V of the Benefit Document regarding "Extended Coverage" is ambiguous with regard to the scope of the coverage provided by that section of the benefit document. The language of Section V of the Benefit Document regarding "Extended Coverage" also conflicts with the language at page seven of the Plan Brochure regarding "Maximum Out-Of-Pocket Expense. /1
Recommendation On the basis of all of the foregoing, it is RECOMMENDED that the Department of Administration issue a Final Order to the following effect: (a) concluding that the "Extended Coverage" language of Section V of the Benefit Document is ambiguous; (b) concluding that the "Extended Coverage" language of Section V of the Benefit Document is in conflict with the language at page 7 of the Plan Brochure under the caption "Maximum Out-Of-Pocket Expense;" (c) concluding that after the Petitioner's out-of- pocket expenses for covered services reached $1,500, she was entitled to have "all further charges" for covered services paid at 100% of the amount of the charges except as specifically limited in paragraph C. of Section V of the Benefit Document; and (d) providing for payment in the total amount of $12,143.10 to the Petitioner or to the providers listed in paragraph 15 of the Findings of Fact. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 22 of May 1992. MICHAEL M. PARRISH, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 SC 278-9675 Filed with the Clerk of the Division of Administrative Hearings this 22 day of May 1992.
The Issue Whether Petitioner's claim against her state group health insurance company for services related to a Magnetic Resonance Imaging examination (MRI) should be granted or denied.
Findings Of Fact At all times material hereto, Petitioner was employed by the State of Florida and was a participant in the State of Florida group health insurance plan, which is a self-insured plan administered by the State of Florida in conjunction with the plan's third party administrator, Blue Cross Blue Shield of Florida (BCBSF). This plan is frequently referred to as the PPO Plan, an acronym for preferred provider organization. Prior to April 26, 2002, Petitioner's physician detected a lump in Petitioner's right breast. Petitioner's physician ordered mammography and ultrasound examinations to be performed on Petitioner's right breast. Those examinations were performed on April 1, 2002. Following those tests, Petitioner's physician ordered an MRI examination of the right breast, which was performed on April 26, 2002, and is the procedure at issue in this proceeding. Following that MRI, Petitioner had another mammography and ultrasound for the diagnosis and treatment of breast cancer. Respondent has paid Petitioner's claims for coverage of the mammography and ultrasound examinations. Respondent has denied payment for the professional fee associated with the MRI in the amount of $215.00. Respondent has paid the facility fee associated with the MRI in the amount of $1,705.00. Respondent asserts that the payment of that fee was in error and intends to seek reimbursement for that payment if it prevails in this proceeding. The terms of coverage of the state group health insurance plan are set forth in a document entitled "State Employees' PPO Plan Group Health Insurance Plan Booklet and Benefit Document" (Benefit Document). The Benefit Document (at page 31, paragraph 47 of the section entitled "Services Not Covered By The Plan") specifically excludes the following from coverage: 47. Services and procedures considered by BCBSF to be experimental or investigational, or services and procedures not in accordance with generally accepted professional medical standards, including complications resulting from these non-covered services. The Benefit Document has a section entitled "Definitions of Selected Terms Used By The Plan" beginning at page 49. The definition of the phrase "experimental or investigational services", found at page 51, includes, in pertinent part, the following: . . . any evaluation, treatment, therapy, or device that: * * * is generally regarded by experts as requiring more study to determine maximum dosage, toxicity, safety or efficacy, or to determine the efficacy compared to standard treatment for the condition has not been proven safe and effective for treatment of the condition based on the most recently published medical literature of the U.S., Canada or Great Britain using generally accepted scientific, medical or public health methodologies or statistical practices is not accepted in consensus by practicing doctors as safe and effective for the condition is not regularly used by practicing doctors to treat patients with the same or a similar condition The Benefit Document provides at page 51 that BCBSF and the Division of State Group Insurance determine whether a service is experimental or investigational. The testimony of Dr. Wood established that an MRI of the breast is experimental or investigational within the meaning of the Benefit Document. 2/ MRI examinations of the breast are not reliable diagnostic tools because such examinations result in an unacceptable number of cases where an MRI produces false negative findings that reflect the absence of cancer where cancer is, in fact, present in the breast. According to Dr. Wood, an MRI cannot be relied upon and should not be used to avoid a biopsy of a suspicious mass because a patient would run an unacceptable risk that the detection of cancer may be delayed or missed. Dr. Wood also testified that radiologists in Florida performing services for the state group insurance health plan have been informed of BCBSF's position. Petitioner's doctors did not inform her prior to the examination that the MRI examination would not be covered by her insurance plan.
Recommendation Based on the foregoing, it is RECOMMENDED that Respondent enter a final order denying coverage for the MRI claims submitted by Petitioner. DONE AND ENTERED this 17th day of February, 2003, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 17th day of February, 2003.
The Issue This case involves a dispute as to whether the Petitioner underpaid the premiums due on his health insurance coverage and, if so, what action should be taken by the Department of Administration as a result of any premium underpayments. By notice dated March 18, 1988, the Department of Administration notified the Petitioner that the Department records "show a total underpayment of $1,117.81 for the coverage periods 9/86 through 9/87." At the formal hearing, over the objection of the Petitioner, the Department was permitted to offer evidence regarding the Petitioner's premium history (both the amounts due and the amounts actually paid) for the entire period of the Petitioner's employment with the State of Florida, a period which runs from May 1978 until October 1988. At the formal hearing the Department of Administration presented the testimony of one witness and offered several exhibits, all of which were received. The Petitioner did not present any evidence, but did present oral argument on his own behalf. The parties were allowed 10 days from November 3, 1988, within which to file their post-hearing submissions with the Hearing Officer. The Department of Administration timely filed Proposed Findings Of Fact. Those findings are specifically addressed in the appendix to this recommended order. The Petitioner did not file any post-hearing submission.
Findings Of Fact Based on the evidence received at the formal hearing, I make the following findings of fact. From May 1, 1978, until August 1, 1978, the Petitioner requested and received family coverage under the State Group Health Self-insurance Plan. From November 1, 1978, until November 1, 1985, the Petitioner requested and received individual coverage under the State Group Health Self-Insurance Plan. From November 1, 1985, until the date of the hearing, the Petitioner requested and received family coverage under the State Group Health Self-Insurance Plan. From May 1, 198, until July 1, 1984, the Petitioner was a part-time employee of the State of Florida, working .25 of a full-time equivalent position. Accordingly, his premiums for health insurance coverage under the State Group Health Self-Insurance Plan during this period should have been paid on the basis of employment in a .25 full-time equivalent position. From July 1, 1984, until at least the date of the hearing, the Petitioner has been a part-time employee of the State of Florida, working .20 of a full-time equivalent position. Accordingly, his premiums for health insurance coverage under the State Group Self-Insurance Plan during this period should have been paid on the basis of employment in a .20 full-time equivalent position. During the period beginning May 1, 1988, and continuing through October of 1988, the amount by which the Petitioner underpaid his health insurance coverage premiums totals S1,116.36. 1/ During the period beginning March 1, 1986, and continuing through October of 1988, the amount by which the Petitioner underpaid his health insurance coverage premiums totals $861.74. During the thirteen-month period beginning with September 1986 and ending with (but including) September 1987, the amount by which the Petitioner underpaid his health insurance coverage premiums totals $258.36.
Recommendation Based on all of the foregoing, I recommend the entry of a Final Order to the following effect: Finding the Petitioner to be in debt to the State of Florida in the amount of $258.36 by reason of underpayment of premiums during the period of September 1986 through September 1987. Providing that the Petitioner's health insurance coverage under the State Group Health Self-Insurance Plan will be cancelled unless within thirty (30) days following the entry of the final order the Petitioner either pays the full amount of $258.36 or enters into an installment payment program consistent with Rule 22K-1.049(1)(a)2., Florida Administrative Code. DONE AND ENTERED this 23rd day of November, 1988, at Tallahassee, Florida. MICHAEL M. PARRISH, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 23rd day of November, 1988.
The Issue The issue presented is whether Petitioner is eligible to participate in the State of Florida's group health insurance plan.
Findings Of Fact Petitioner Judy Stahl began her employment with the State of Florida as a public assistance specialist with the Department of Children and Families on October 4, 1991. She began participating in the State's group health insurance program on December 1, 1991. Petitioner voluntarily terminated her employment by the State on November 28, 2002, for personal reasons. In her letter of resignation she stated that it was her intention to again seek employment with the State after the personal situation which caused her to resign was concluded. Premiums for the State's group health insurance are paid one month in advance. Therefore, Petitioner's coverage under the State's group health insurance program continued through the end of December 2002. In January 2003, the State's Division of State Group Insurance notified Petitioner of her right to elect continuation coverage under the federal Consolidated Omnibus Budget Reconciliation Act (COBRA) and the federal Public Health Services Act (PHSA). Petitioner so elected and continued her participation in the State's group health insurance under COBRA for the maximum period of 18 months that was available to her. Her continuation coverage expired June 30, 2004. In May 2004 the State's Division of State Group Insurance notified Petitioner that her continuation coverage would soon expire and further advised her of her right to convert her insurance coverage to a private, individual policy. Petitioner exercised her option to convert to a private policy, effective July 1, 2004. In March 2005 the Florida Division of Retirement sent Petitioner an Estimate of Retirement Benefits. The Estimate contained the comment that: "As a result of a review of accounts for terminated members, it was determined that you are eligible for retirement benefits." The Estimate form was accompanied by a pamphlet explaining the Florida Retirement System Pension Plan. It was also accompanied by information on the State Employees' Preferred Provider Organization (PPO) health plan. The retirement pamphlet included the information that health insurance was available to retirees; however, the health insurance information advised that health insurance was only available to certain retirees. Petitioner concluded that if she retired, she could obtain cheaper health insurance from the State than from her private provider. This was the first time that Petitioner considered the possibility of retirement. Petitioner thereafter made many telephone calls to the Department of Children and Families, to the Division of Retirement, to the Division of State Group Insurance, and to People First, inquiring about retirement and insurance. These telephone inquiries were the first time she mentioned to any State employee or representative that she was interested in retiring. At the end of March 2005 she made the decision to retire and submitted her application for retirement benefits. Her effective retirement date was April 1, 2005. At the time Petitioner filed her application for retirement, she was no longer participating in the State's group health insurance program. At the time she filed her application for retirement, she was no longer participating in continuation coverage pursuant to COBRA. She was insured under a private policy. At the time of her initial enrollment in the State group health insurance program, Petitioner signed a new enrollee form that, inter alia, advised her that eligibility and enrollment were governed by the provisions of Florida Administrative Code Rule 22K-l. During her employment she also enrolled in supplemental dental insurance. That enrollment application form notified Petitioner that any changes in enrollment or coverage are governed by the federal Internal Revenue Code and the Florida Administrative Code. Throughout her employment and at the time that she terminated her employment, she completed Annual Benefits Open Enrollment forms, which also notified her that any changes in enrollment or coverage are governed by the Internal Revenue Code and the Florida Administrative Code. While employed by the Department of Children and Families, Petitioner was provided with copies of the State of Florida Employees Group Health Self Insurance Plan Booklet and Benefit Document. Those booklets describe eligibility for participation to include employees, certain retirees, and COBRA participants. They also describe termination of coverage due to termination of employment and describe continuation coverage and conversion coverage. At the time Petitioner retired, she was not a State employee; she was a former State employee.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding that Petitioner is not eligible to participate in the State's group health insurance program. DONE AND ENTERED this 19th day of January, 2006, in Tallahassee, Leon County, Florida. S LINDA M. RIGOT Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 19th day of January, 2006. COPIES FURNISHED: Mark J. Berkowitz, Esquire Mark J. Berkowitz, P.A. 524 South Andrews Avenue, Suite 200N Fort Lauderdale, Florida 33301 Sonja P. Matthews, Esquire Department of Management Services 4050 Esplanade Way, Suite 260 Tallahassee, Florida 32399-0950 Tom Lewis, Jr., Secretary Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950 Alberto Dominguez, General Counsel Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950
The Issue The issue in this case is whether the Respondent, the Department of Administration, Division of State Employees' Insurance, administrator of the State of Florida group health insurance policy, should pay all covered medical expenses incurred by the Petitioners for non-PPC providers on behalf of their dependent daughter that exceed $3,000 1/ maximum out-of-pocket expense stop loss provision of the policy, despite the part of the stop loss provision that subjects it to maximum payments for room and board (and some other services) supplied by non-PPC providers.
Findings Of Fact Pertinent History of the Insurance Plan. The State of Florida offers group health insurance to its employees, including employees of the State University System, as an optional fringe benefit. Since 1978, the State has self-insured this coverage. The group health insurance coverage is administered by the Respondent, the Department of Administration, Division of State Employees' Insurance. The Respondent contracts with Blue Cross Blue Shield of Florida as a third party administrator of the insurance coverage. The State pays part of the premium required for the coverage; the balance of the premium is paid by the employee. Depending on their county of residence, state employees can choose membership in one of several approved health maintenance organizations (HMOs) in lieu of coverage under the State's health insurance plan. When an employee joins an approved health maintenance organization in lieu of the state health insurance plan, the State contributes to the cost of membership to the same extent that it contributes to an employee's insurance premium under its group health insurance plan. Since the State began to self-insure in 1978, coverage under the state group health insurance contained limits on the maximum amount the plan would pay for hospital room and board. The plan also differentiated between the amounts that would be paid under the plan for services rendered by pre-approved "preferred providers" (PPCs). From time to time through the years, the Florida Legislature changed the maximum amounts the plan would pay for various services, and the plan was changed accordingly. But in each version of the plan, there was a distinction made between services rendered by a PPC versus services rendered by a non-PPC. When the State began to self-insure its employee group health insurance benefit on May 1, 1978, it mailed a new, 25-page certificate of insurance to each employee covered by the plan. Whenever a change in the coverage under the state group health insurance plan was occasioned by new legislation, a revised certificate of insurance was mailed to each employee covered by the plan. This occurred in July, 1982, (a 40-page booklet), in August, 1983, (an eight-page addendum), in August, 1985, (a 13-page booklet), and in July, 1988 (a 13-page booklet). Consistent with the master group health insurance policy to which they refer, each of these certificates of insurance are clear that the maximum out- of-pocket "stop loss" feature is subject to certain limitations. In particular, all make clear that the feature is subject to a maximum payment for room and board. Each of these certificates of insurance contains language cautioning the employee that the certificate is not a contract of insurance, that the purpose of the certificate is only to summarize the insurance plan, and that the certificate does not include all covered and non-covered benefits. Each also advises that a copy of the complete contract (the master policy), and the administrative rules under which the plan is administered, could be inspected in the office of the Respondent, as well as in the employee's personnel office. Each advises employees to present questions to their agency personel office or to the Office of State Employee's Insurance. The August, 1985, certificate of insurance reflects a change in the policy to differentiate between PPC and non-PPC providers. It also clearly states that the maximum out-of-pocket stop loss feature of the policy is subject to maximum payments for room and board (and some other services) supplied by non-PPC providers. The July, 1988, certificate also clearly provides that the maximum out-of-pocket stop loss feature of the policy is subject to maximum payments for room and board (and some other services) supplied by non-PPC providers. Both of these certificates were entitled the "State of Florida Employees Group Health Self Insurance Plan Brochure." In addition to the certificates of insurance, Blue Cross Blue Shield also printed an abbreviated version of the July, 1988, insurance certificate called the "State of Florida Employees Group Health Self Insurance Plan Benefits." It is a seven-page document intended for distribution, along with information concerning the various available state-approved HMOs, to all new state employees, who have the opportunity to choose to enroll in the state group health plan, in one of the HMOs, or neither. It also was intended for distribution to all employees during open enrollment periods, when employees have the opportunity to change from an HMO to the state group health insurance, or vice versa, or to drop the benefit. The purpose of the "benefits" document was to give employees information on which to make that choice. Since it was anticipated that it would be mailed to many state employees who ultimately would choose against the state group health insurance plan, the information was condensed to shorten the document to save mailing costs. Only if a new employee (or an old employee during the open enrollment period) chose the insurance would the employee get mailed a certificate of insurance in the mail. Among the information contained in the July, 1988, "benefits" document was an item entitled "Maximum Out of Pocket Expense" that simply listed: "$1500 individual coverage" and "$3000 family coverage." Omitted from the "benefits" document were the limitations on the maximum out-of-pocket stop loss feature (Finding 7, above) and the language cautioning that it was not a contract (Finding 6, above). Under the heading "Exclusions and Limitations," it states: "Complete list in employee brochure." The last two pages of the document contains two lists, one entitled "Limitations," and the other entitled "Exclusions." Neither list specifies the limitations on the maximum out-of- pocket stop loss feature (Finding 7, above). On the cover of the document, it states: "This brochure replaces any other brochure or booklet printed prior to July 1, 1988, relative to the Plan and shall remain in effect until further notice." The Saffs' Insurance Decision. Edward B. Saff has been a mathematics professor at the University of South Florida (USF) in Tampa, Florida, for 22 years. The Saffs did not prove that they did not receive copies of the May 1978, July, 1982, August, 1983, August, 1985, and July, 1988, certificates of insurance. The Saffs' daughter Lisa, who was born on April 24, 1970, had been diagnosed in June, 1985, as having acute lymphoblastic leukemia. She was treated at the University of South Florida through June, 1988, and seemed to have been cured. During the summer of 1988, the Saffs had occasion to consider the question whether they should obtain health insurance other than, and in addition to, their family coverage under the State employees' group health insurance. Although the Saffs did not prove that they had not received their copies of the May 1978, July, 1982, August, 1983, August, 1985, and July, 1988, certificates of insurance, they apparently did not retain them or at least did not have them readily available to consult. As a result, Dr. Saff asked his secretary to get information on the state employees' group health insurance coverage from the USF personnel office. The evidence was that the Department of Administration has made a copy of the master group health self-insurance policy, and copies of the certificate of insurance, available in all state agency personnel offices, including in the USF personnel offices, for inspection by state employees. The July, 1988, certificate of insurance states: "The agency personnel office will provide needed assistance to State officers and employees enrolling in the Plan; however, such officers or employees should take care to assure that they receive the coverage applied for and that proper deductions are made." But there was no evidence specifically what Dr. Saff told his secretary to ask of his USF personnel office. Dr. Saff's secretary did not testify, and there was no evidence from which a finding can be made as to what the secretary asked for or what the secretary was told by the USF personnel office. But the secretary returned with a copy of the abbreviated version of the July, 1988, insurance certificate (the "State of Florida Employees Group Health Self Insurance Plan Benefits.") Cf. Findings 8 and 9, above. Based exclusively on the information relayed by Dr. Saff's secretary, i.e., on the abbreviated version of the July, 1988, insurance certificate (the "State of Florida Employees Group Health Self Insurance Plan Benefits"), with its incomplete information under the heading entitled "Maximum Out of Pocket Expense," the Saffs decided that they did not need any additional health insurance coverage for their daughter Lisa. They reasoned that they could afford the maximum out of pocket expense referenced in the document. They did not seek any further information about the policy before making this decision. The Saffs' Insurance Claim. In August, 1990, Lisa Saff underwent a routine gynecological examination, and a pelvic mass was discovered. The mass was removed surgically at Humana Women's Hospital in Tampa. Cancer of the ovaries was diagnosed, but at first the type of cancer was not identified. After more tests, it was determined that Lisa had suffered a recurrence of her previous cancer, but it was highly unusual for that type of cancer to recur in the ovaries. Since the physicians at Humana Women's and at USF were unfamiliar with the recurrence of the cancer in the ovaries, they recommended that Saffs seek medical care at Sloan-Kettering Hospital in New York City, where Lisa began treatment in the early part of September, 1990. Since starting treatment at Sloan-Kettering, Lisa has been under the care of Dr. Timothy Gee. She was hospitalized at Sloan-Kettering three times in 1990 and approximately twice in 1991. Fortunately, she has responded to treatment and is now on the maintenance portion of her protocol, receiving treatment as an outpatient of the hospital. Sloan-Kettering charges $700 a day for a hospital room and also charges for some other medical services in excess of the PPC fee and charge schedule under the State of Florida Group Health Self Insurance policy. In all, the Saffs have incurred $46,870 for medical treatment for Lisa for 1990. As of the date of the final hearing, they incurred $14,439 for medical treatment for Lisa for 1991. They continue to incur medical expenses for Lisa under her maintenance protocol. They have submitted claims for payment under the state group health insurance policy, including all medical expenses during both 1990 and 1991 by which their out-of-pocket expense exceeded $3000 per calendar year. 2/ The Respondent's Position. In response to the Saffs' claims, the Respondent has taken the position that, in accordance with the master policy and the certificate of insurance, the maximum out-of-pocket stop loss feature of the policy is subject to maximum payments for room and board (and some other services) supplied by non-PPC providers. Cf. Finding 7, above. In accordance with that position, the Respondent has paid $18,554 of the Saffs' 1990 claims and $2,162 of the Saffs' 1991 claims. (The Saffs have paid $14,089 of the balance of their 1990 claims and $9,250 of the balance of their 1991 claims.)
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Respondent, the Department of Administration, Division of State Employees' Insurance, enter a final order (1) giving effect to the provision of the group health self-insurance plan that subjects the maximum out- of-pocket stop loss feature of the policy to maximum payments for room and board (and some other services) supplied by non-PPC providers and (2) paying $18,554 of the Saffs' 1990 claims and $2,162 of the Saffs' 1991 claims. RECOMMENDED this 19th day of September, 1991, in Tallahassee, Florida. J. LAWRENCE JOHNSTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 19th day of September, 1991.
