The Issue The principal issue in this case is whether the Respondent, Dr. Livingston, is in violation of Section 458.331(1)(b), Florida Statutes, by reason of certain events which occurred in New Jersey. The Respondent has also raised several collateral issues, including issues concerning the validity of and the interpretation to be given to the cited statutory provision.
Findings Of Fact Based cn the exhibits received in evidence at the hearing in this case, I make the following findings of fact. The Respondent, Robert Michael Livingston, M.D., is a licensed medical physician, having been issued license number NE0009825 by the Florida Board of Medical Examiners. His last known address is 33 Southeast Third Street, Boca Raton, Florida 33432. Dr. Livingston has been licensed to practice medicine in both the State of Florida and the State of New Jersey for a number of years. The Dr. Livingston who is the Respondent in this case is the same Dr. Livingston who holds license number 18863 in the State of New Jersey and who was the subject of the administrative proceedings in the State of New Jersey which were resolved by a Final Order by Consent dated January 12, 1983. By an Administrative Complaint dated May 18, 1981, and an Amended Administrative Complaint dated September 17, 1981, the Attorney General of the State of New Jersey sought the suspension or revocation of Dr. Livingston's license to practice medicine in the State of New Jersey. The grounds alleged in the Amended Administrative Complaint included conduct which was asserted to constitute (a) the employment of unlicensed persons to perform work which may legally be done only by persons licensed to practice medicine and surgery; (b) gross malpractice and gross neglect in the practice of medicine; (c) professional incompetency; (d) lack of capability to discharge the functions of a medical licensee in a manner consistent with the health, safety and welfare of the public; and (e) habitual use of intoxicants. The allegations of the New Jersey Administrative Complaint and Amended Administrative Complaint were never proven in any proceeding in New Jersey. All of the allegations of the New Jersey Administrative Complaint were resolved by the entry of a Final Order by Consent dated January 12, 1983. The prefatory language of the Final Order by Consent contains the following relevant language: Subsequent to the filing of the complaint the parties have concluded that this dispute can be amicably resolved by means of this Final Order by Consent. In entering into this Final Order Dr. Livingston denies any malpractice, gross or otherwise, and this resolution of the dispute is therefore not to be construed as an admission by Dr. Livingston of any of the allega- tions contained in the complaint. The parties hereto acknowledge that the Board of Medical Examiners does not contend that Dr. Livingston is presently dependent upon controlled dangerous substances. In entering into this Final Order the Board of Medical Examiners relies upon Dr. Livingston's representation that he is not now practicing medicine and surgery in New Jersey, but is so practicing in the State of Florida. The dispositional language of the Final Order by Consent reads as follows: IT IS ORDERED AND AGREED, therefore, on this 12th day of January, 1983, that: Robert M. Livingston will not practice medicine and surgery in the State of New Jersey for a two-year period, that period having commenced on May 22, 1981. If at any time after the expiration of this two- year period he shall seek to practice medicine and surgery in New Jersey, he shall either personally appear before the Board of Medical Examiners or submit proof of his compliance with paragraph 2 of this Final Order. In addition, the Board of medical Examiners may in its discretion reguire Dr. Livingston to submit to a general psychiatric evaluation performed by a Board-certified psy- chiatrist designated by the Board of Medical Examiners to determine whether there exists any medically unjustified dependence upon con- trolled dangerous substances. Bobert M. Livingston will pay $2,500.00 as a sharing of the costs of the Board inquiry into the matters resolved by this Final Order. Robert Il. Livingston will pay the expert fee billed to Dr. Livingston by Dr. Leslie Iffy for Dr. Iffy's testimony during depo- sitions, and Dr. Livingston will be responsible for paying the cost of all transcripts of the depositions of Dr. Iffy, Kathleen M. Brancaccio and Nicholas Brancaccio. None of the provisions of this Final Order by Consent shall be deemed a disciplinary sanction or penalty under the Medical Practice Act. This Final Order by Consent consitutes resolution of all matters arising from the complaint as it pertains to Robert A. Livingston, and the complaint as it pertains to him is dismissed with prejudice. (Emphasis added.) Thereafter, effective July 1, 1953, Dr. Livingston's license to practice medicine in the State of New Jersey was renewed for a two-year period ending on June 30, 1955. ANALYSIS OF TUE ISSUES Issues Regarding Findings of Fact The Respondent has asserted that Petitioner's Composite Exhibit 2 constitutes hearsay evidence which would not be admis- sible over objection in a civil action and that, by operation of Section 120.55(1)(a), Florida Statutes, the exhibit is insufficient to support a finding of fact. Contrary to the assertions of the Respondent, it should be noted that Petitioner's Composite Exhibit 2 comes within the "public records exception to the hearsay rule [see 90.803(8), Fla. Statutes] and is self-authenticating within the meaning of Section 90.902, Florida Statutes. Accordingly, the exhibit would be admissible over objection in a civil action and is, therefore, a sufficient basis for making findings of fact in this case. In making the foregoing findings of fact, I have, with the exceptions noted hereinafter, incorporated the text or substance of the vast majority of the findings of fact proposed by the parties. My reasons for not making certain findings proposed by the respondent are as follows. The last sentence of Respondent's proposed finding number 3 is not supported by competent substantial evidence. The penultimate sentence of Repondent's proposed finding number 4 is more in the nature of argument or a proposed conclusion of law than a proposed finding of fact. My reason for not making Petitioner's proposed finding of fact numbered 4 is that it is more in the nature of a conclusion of law than a proposed finding of fact--it is a proposed interpretation of the legal effect of the Final Order by Consent rather than a summary of the text of that order. The Delegation of Authority Issue At the hearing in this case, the Respondent also argued that Section 458.331(1)(b), Florida Statutes, constitutes an improper delegation of authority to officials of other states because by operation of the statute officials in other states are able to determine who shall be subject to discipline in the State of Florida. This argument has already been resolved contrary to the Respondent's contentions. See Bryan v. State Board of Medical Examiners of Florida, 381 So. 2d 1122 (Fla. 1st DCA 1979), affirmed, 398 So. 2d 1354 (Fla. 1981). The Sufficiency of the Statement of the Charges Against the Respondent The Respondent also asserts that a finding of guilt in this case would constitute a denial of due process because he was charged in the Administrative Complaint with having his license "acted upon" and was not charged, in the language of the statute, with having his license "acted against." There are, of course, cases in which a failure to charge in the statutory language could deprive a Respondent of his right to know the charges against him and have adequate opportunity to prepare his defense against them. But the Respondent is not entitled to a perfect statement of the charges against him. Rather, the standard which west be met by the language of the Administrative Complaint is that the . . . . grounds for revoking a license to practice medicine must be alleged with reasonable certainty and show the nature and cause of the accusa- tion and he must be given reasonable opportunity to defend against attempted proof of such charges. (Emphasis added.) State ex rel. Sbordy v. Rowlett, 190 So. 59 (Fla. 1939), at 62. Despite the failure of the Administrative Complaint in this case to track the exact language of the statute, the Respondent had full knowledge of the factual basis for the charge against him and was also fully aware of the legal basis for the charge. Therefore, he knew with "reasonable certainty" what the Petitioner would attempt to prove, and he had a "reasonable opportunity" to defend against the charge. The Principal Issue in the Case Turning at last to the heart of the matter, the principal issue which must be decided in this case is whether the actions of the Attorney General of the State of New Jersey or the Hoard of Medical Examiners of the State of New Jersey described in the findings of fact constitute, in the language of Section 455.331(1)(b), Florida Statutes: Having a license to practice medicine revoked, suspended, or otherwise acted against, including the denial of licensure, by the licensing authority of another state, territory, or country. For the reasons explained below, I conclude that they do not. Part of the resolution of this issue turns on the interpretation to be given to the terms "suspended," "acted against," and "licensing authority," as used in Section 458.331(1)(b), Florida Statutes. None of these terms are defined in the statute. Accordingly, pursuant to well-established rules of statutory construction, these terms must be given their plain and ordinary meaning. See cases collected at Vol. 10-B, Florida Digest, Statutes, 188, of which the following is a modest sample. Crown Diversified Industries, Inc. v. Watt, 415 So.2d 803 (Fla. 1st DCA 1982); St. Petersburg Bank & Trust Co. v. Hamm, 414 So.2d 1071 (Fla. 1982); J. C. Vereen & Sons, Inc. v. City of Miami, 397 So.2d 979 (Fla. 3d DCA 1981); Gasson v. Gay, 49 So.2d 525 (Fla. 1951); Gaulden v. Kirk, 47 So.2d 567 (Fla. 1950). The term "licensing authority," as used in Section 458.331(1)(b), Florida Statutes, means the governmental entity in a foreign jurisdiction which possesses the power and authority to take final action to grant a license or to deny, revoke, or suspend a license, or to otherwise impose discipline on a licensee. In this case, the relevant "licensing authority" is the Board of Medical Examiners of the State of New Jersey. The Attorney General of the State of New Jersey is not a "licensing authority" within the meaning of Section 458.331(1)(b), Florida Statutes, because, although the Attorney General prosecutes complaints against licensees, nothing in this record shows that the Attorney General has the power and authority to grant, revoke, or suspend a license, or to impose any discipline on a licensee. Therefore, even if the actions of the Attorney General of the State of New Jersey described in the findings of fact were to be construed as action against a license, such action would not establish a violation of Section 458.331(b), Florida Statutes, because it would not be action by a "licensing authority." Accordingly, in order to establish a violation of the cited statute in this case, the Department must show that the Board of Medical Examiners of the State of New Jersey suspended or acted against the license of Dr. Livingston. 2/ The plain meaning of the term "suspend" is "to render temporarily void" or "to punish by temporary exclusion." See The Random House Dictionary. And the plain and ordinary meaning of "against," in the context in which it appears in the subject statute, is "in opposition or hostility to." Id. A careful review of the Final Order by Consent reveals that the action taken by the Board of Medical Examiners of the State of New Jersey did not suspend Dr. Livingston's license and did not constitute any action against Dr. Livingston's license. The Final Order by Consent does not purport to suspend Dr. Livingston's license and does not purport to impose any other form of discipline against him. This is evidenced by the penultimate paragraph of the order, which specifically states: "None of the provisions of this Final Order by Consent shall be deemed a disciplinary sanction or penalty under the Medical Practice Act." (Emphasis added.) Further, there is nothing in the Final Order by Consent which purports to order Dr. Livingston to do anything or to refrain from doing anything. Quite to the contrary, the dispositive action of the New Jersey Board in the final paragraph of the Final Order by Consent was to dismiss, with prejudice, the complaint against Dr. Livingston. The Department argues that the language of paragraph number 1 of the Final Order by Consent constitutes a suspension of, or action against, Dr. Livingston's New Jersey license and that paragraphs number 2 and 3 of that order also constitute action against Dr. Livingston's New Jersey license. Paragraph number 1 of the Final Order by Consent does state that Dr. Livingston "will not" practice medicine in the State of New Jersey for a specified period and paragraphs number 2 and 3 of that order do state that Dr. Livingston "will pay" certain expenses related to the case. But those paragraphs cannot be interpreted as having the legal effect urged by the Department, because to do so would be to belie the express language of paragraph number 4 of the same document (which states that nothing in the order constitutes "a disciplinary sanction or penalty") and to ignore the operative language of the order, which is to dismiss the complaint with prejudice. It would be a total contradiction to say, on the one hand, that the New Jersey Board dismissed the complaint against Dr. Livingston and did not impose any disciplinary sanction or penalty and to then conclude that the New Jersey Board had suspended Dr. Livingston's license and had otherwise acted against his license. Furthermore, nothing in paragraphs number 1, 2, or 3 of the Final Order by Consent prohibits Dr. Livingston from doing anything or orders Dr. Livingston to do anything. Those paragraphs simply state that Dr. Livingston will not do this and will do that. The clear import of the statements in these three paragraphs is that they recite what Mr. Livingston has agreed to do and not to do. It is noteworthy that these three paragraphs are immediately preceeded by a statement reading "IT IS ORDERED AND AGREED." Inasmuch as the three subject paragraphs do not order Dr. Livingston to do or refrain from doing anything, they can only be construed as manifestations of what Dr. Livingston agreed to do and to refrain from doing. Thus, these paragraphs constitute action taken by Dr. Livingston, not action taken by the Board. Finally, this interpretation of paragraphs number 1, 2, and 3 is compelled by the fact that it would be incongruous to conclude that the New Jersey Board was, in a single act, both penalizing Dr. Livingston (which the order specifically disavows) and dismissing all charges against him. Reduced to the vernacular, the New Jersey Board made a deal with Dr. Livingston that if he would agree to do this and not do that, they would not take any action against him, and the Final Order by Consent is the implementation of that deal. And in this regard it is important to take cognizance of the fact that the Final Order by Consent was not a consent to the entry of an order against Dr. Livingston. Quite to the contrary, it was a consent to a dismissal of all charges. The Department also argues by analogy that the New Jersey consent order in this case is as sufficient a basis for finding a violation of Section 458.331(1)(b) as was the consent order entered by the Composite State Board of Medical Examiners of the State of Georgia, which was relied on in Department of Professional Regulation, Board of Medical Examiners v. Ralph C. Lee, M.D., 4 FALR 2388A (1982) The analogy fails because of the following notable differences. In the Lee case, Dr. Lee's consent in the Georgia case included an admission of some or all of the charges brought against him. Here, Dr. Livingston's consent in the New Jersey case incorporates an express denial of the charges against him. In the Lee case, the Georgia Hoard revoked Dr. Lee's license and then put Dr. Lee on probation. Here the New Jersey Hoard dismissed with prejudice all charges against Dr. Livingston. In the Lee case, a clear violation of Section 485.331 (1)(b) , Florida Statutes, was established. Here, there was no such violation. A Collateral Issue Which Need Not Be Decided Here A final issue which need not be decided here, but which nevertheless warrants brief attention, is the Respondent's contention that his due process rights will be violated unless Section 458.331(1)(b), Florida Statutes, is construed quite narrowly. He argues that Section 458.311(1)(b) should be construed . . . . as requiring the allegation, substan- tiated by competent substantial evidence, that a licensee has had his license revoked, suspended or otherwise acted against by the licensing authority of another state, territory, or country, for conduct which would constitute a violation of 458.331, Florida Statutes, if that conduct were committed in Florida. Petitioner replies to the foregoing by arguing that the Respondent's due process arguments involve constitutional issues which are beyond the scope of the Hearing Officer's authority. In view of the foregoing conclusions about the effect of the Final Order by Consent, it is not necessary in this case to embark upon a lengthy analysis of the extent to which the proper interpretation of Section 358.331(1)(b) , Florida Statutes, may be colored by constitutional considerations. 4/ Nevertheless, because occasion to address this issue may arise at some later stage in these proceedings, I commend to the parties' attention the following comments from Hotel, Motel, Restaurant Employees and Bartenders Union, Local 737 v. Escambia County School Board, 3 FALR 2122A (1981) at 2125A--2126A, affirmed, 426 So.2d 1017 (Fla. 1st DCA 1983): Prior to embarking upon a discussion of the constitutional ramifications of the issues at hand we hasten to acknowledge that we are well aware of the limitations upon an adminis- trative agency's role in matters which involve the application or interpretation of our State Constitution. As noted in Barr v. Watts, 70 So.2d 347 (Fla. 1953) , and State ex rel. Atlantic Coast Line Railroad Co. v. State Board of Equalizers, 94 So. 681 (ala. 1922) the "right to declare an act unconstitutional cannot be exercised by the officers of the executive department under the guise of the observance of their oath of office to support the Constitution." But the fact that we are without authority to rule upon the constitutionality of statutes does not mean that we must ignore the Constitution. To the contrary, where the meaning of a statute is colored by provisions in the Constitution our hope of reaching the correct understanding of that meaning lies in part in a consideration of those constitutional consequences. * * * * And while we may not, in the course of ourefforts to construe applicable statutory provisions, declare a statute to be unconstitutional, neither are we required to fumble around in some pretended ignorance of reality. if we are to act responsibly, we must act in full contemplation of the inescapable consequences of what the courts have already said about similar statutes . . . And even though we lack the power of a court with regard to the ruling upon the validity of a statute, we owe to the Legislature certainly no less duty than is owed by the courts to respect the enactments of that body. In this regard it seems especially appropriate for us to follow the same rules as are followed by the courts in their construction of statutory pro visions which skate near the thin ice of constitutional invalidity particularly in light of the fact that in the event of judicial review of this order notions of stare decisis make it most likely that any reviewing court would also resort to the same time-tested rules of construction. (Word in square brackets added.) See also: Florida Education Association/United v. Public Employees Relations Commission, 346 So.2d 551 (Fla. 1st DCA 1977), at 553. In Brief Summary In sum: The Final Order by Consent issued by the Hoard of Medical Examiners of the State of New Jersey on January 12, 1983, does not constitute a suspension of Dr. Livingston's license to practice medicine in that state, nor does it constitute action against such license. There is no competent substantial evidence in the record of any other revocation, suspension, or action against Dr. Livingston's license to practice medicine in New Jersey. Therefore, the violation charged in the Administrative Complaint in this case has not been proved and the Administrative Complaint should be dismissed.
Recommendation Based upon all of the foregoing, I RECOMMEND that the Florida Board of Medical Examiners enter a Final Order in this case dismissing in its entirety the Administrative Complaint against Dr. Livingston. DONE and ORDERED this 28th day of June, 1984, at Tallahassee, Florida. MICHASEL M. PARRISH 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 28th day of June, 1984.
The Issue At issue in this proceeding is whether Respondent committed the offenses set forth in the Administrative Complaint1 and, if so, what penalty should be imposed.
Findings Of Fact Respondent's licensure and employment Respondent, Nury D. Soler, is now, and was at all times material hereto, licensed as a pharmacist by the State of Florida, having been issued license number PS 0014628. Pertinent to this case, Respondent was the prescription department manager for Westchester Pharmacy for a two-month period extending from some time in October 1996 and at least through December 13, 1996. Westchester Pharmacy is a community pharmacy licensed by Petitioner, pursuant to Section 465.018, Florida Statutes, and located at 7253 Southwest 24th Street, Miami, Florida. The pharmacy owner or permittee was Noriel Batista. The pharmacy inspection On December 14, 1996, a Saturday, Richard Castillo, an investigator employed by the State of Florida, entered the Westchester Pharmacy to conduct a routine community pharmacy inspection. Upon entry, Mr. Castillo observed only one person in the pharmacy, a man later identified as the permittee (Mr. Batista). At the time, Mr. Batista was observed in the vicinity of the prescription area, at the rear of the store. Mr. Castillo proceeded to the counter at the rear of the store, and was approached by Mr. Batista. Thereupon, Mr. Castillo feigned a toothache, and the following events transpired: . . . I put my hands on my face and I said I have some tooth pain, is there anything you can do about it. At which time, he said you really need to go see a dentist. I said that dentists cost a lot of money and that I believed that it was an infection. At which time he came back with a bottle of twenty Amoxicillin, 500 milligram capsules. He sold me the bottle for $10.00 and I gave him the $10.00. He then gave me some preliminary instructions, and went back into the prescription department area. He returned and said that as a gift I'm going to give you these medications; which was four capsules of Motrin 800 milligrams. Amoxicillin is a prescription drug, which Mr. Batista, who was not licensed as a pharmacist, sold without benefit of a prescription. Following the sale, Mr. Castillo identified himself as an investigator, told Mr. Batista he was present to conduct a routine inspection, and asked to speak with the pharmacist. When told the pharmacist was not available, Mr. Castillo asked Mr. Batista to telephone her and ask her to come to the store. Mr. Batista did so, and about an hour later Respondent arrived. Mr. Castillo inspected the pharmacy and completed a community pharmacy inspection report on which he noted a number of perceived deficiencies. (Petitioner's Exhibit 2). First, with regard to Mr. Batista's sale of amoxicillin, Mr. Castillo noted three deficiencies or violations against the pharmacy business, to-wit: (1) there was no pharmacist on duty when the prescription department was open (a perceived violation of Rule 64B16-28.109, Florida Administrative Code); (2) there was no pharmacist present to provide patient counseling, if requested (a perceived violation of Rule 64B16-27.820, Florida Administrative Code); and, (3) since Mr. Batista did not document the sale, Mr. Castillo considered the pharmacy records of dispensing to be incomplete (a perceived violation of Rule 64B16-28.140(3)(b), Florida Administrative Code). Other deficiencies noted by Mr. Castillo against the pharmacy business were as follows: (1) there was no sign displayed that the pharmacy was closed (a perceived violation of Rule 64B16-28.109(1), Florida Administrative Code); (2) the pharmacist's (Ms. Soler's) license was not displayed (a perceived violation of Rule 64B16-27.100(1), Florida Administrative Code); and, (3) there was no sign displayed which stated the hours the prescription department was open each day (a perceived violation of Rule 64B16-28.404, Florida Administrative Code). No further deficiencies were observed and, apart from those noted deficiencies, the prescription department appeared appropriately maintained and operated. Following Respondent's arrival at the pharmacy, Mr. Castillo discussed with her the various deficiencies he had found and had noted on his report. Then, as the "Pharmacist," Respondent signed the report. By signing the report, she acknowledged that "I have read and have had this inspection report and the laws and regulations concerned herein explained, and do affirm that the information given herein is true and correct to the best of my knowledge." Among the information provided on the inspection report was the name of the prescription department manager, which was stated to be the Respondent. Respondent's employment status with Westchester Pharmacy on the date of the inspection Notwithstanding her appearance at Westchester Pharmacy on Saturday, December 14, 1996, and her signing of the inspection report as the Pharmacist for Westchester Pharmacy, Respondent averred, at hearing, that by December 14, 1996, she was no longer affiliated with the pharmacy or responsible for the deficiencies noted. According to Respondent, by December 12, 1996, she had agreed with another pharmacy, Coral Way Pharmacy, Inc., (Coral Way Pharmacy) to serve as its pharmacist effective December 16, 1996, at its pharmacy located at 6965 Southwest 24th Street, Miami, Florida, and that her last date of employment with Westchester Pharmacy was December 13, 1996. While perhaps not entirely free from doubt (given the facial inconsistency between Respondent's contention at hearing and the conclusion one could reasonably draw regarding her association with Westchester Pharmacy, as evidenced by her activities on the date of inspection), the proof demonstrates, more likely than not, that, as Respondent averred, she was no longer employed by Westchester Pharmacy on the day of inspection, her presence on the day of inspection was a matter of accommodation to Mr. Batista, and her signing of the report was a matter of misunderstanding. In so concluding, it is observed that, while the pharmacy was open Monday through Saturday, the prescription department was not open on Saturday, or, stated differently, under the terms of Respondent's employment with Weschester Pharmacy she did not work week-ends. Given that Respondent and Coral Way Pharmacy, reached an agreement on December 12, 1996, for her to begin work at Coral Way Pharmacy on December 16, 1996, it is reasonable to conclude, given the nature of her work-week at Westchester Pharmacy, that her last day of employment with Westchester Pharmacy was Friday, December 13, 1996. Moreover, consistent with the conclusion that Respondent's association with Weschester Pharmacy terminated on December 13, 1996, is the absence of Respondent's wall certificate and license on the date of inspection. Notably, Respondent had not suffered prior disciplinary action in 19 years of practice, and presumably knew that, if employed, she was required to display her wall certificate and license in or near the prescription department. Conversely, she also knew, presumably, that she could not lawfully display them, if she was no longer employed by Westchester Pharmacy. Rule 64B16-27.100, Florida Administrative Code. Since it is presumed that persons will observe the law, the absence of Respondent's wall certificate and license on the date of inspection is consistent with her assertion that, by that date, she was no longer employed by Westchester Pharmacy. Atlantic Coast Line R. Co. v. Mach, 57 So. 2d 447 (Fla. 1952). Finally, also consistent with the conclusion that Respondent's employment with Westchester Pharmacy terminated before the date of the inspection is a statement Respondent made to the inspector. According to the investigator, when asked about the infractions, Respondent stated the following: . . . She said that things needed to change. She asked if she were to leave the pharmacy whether that would change anything, and I said, no, it doesn't matter because you're the pharmacist of record at this point of time. Such statement, when considered in context with other proof of record, discussed supra, is consistent with Respondent having resolved, previously, to terminate her employment with Weschester Pharmacy and, since she did not specifically tell the investigator of her decision, his response evidenced a misunderstanding that resulted in Respondent's execution of the report.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered dismissing the Administrative Complaint. DONE AND ENTERED this 25th day of August, 1998, in Tallahassee, Leon County, Florida. WILLIAM J. KENDRICK 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 Filed with the Clerk of the Division of Administrative Hearings this 25th day of August, 1998.
Findings Of Fact On May 10, 1983, the Petitioner Florida Psychiatric Centers submitted two letters of intent to the Respondent Department of Health and Rehabilitative Services to construct psychiatric hospitals in Palm Beach and Marion Counties. On June 10, 1983, the Petitioner timely submitted both applications for certificates of need to the Department. On February 11, 1983, the Department imposed an administrative moratorium with respect to the construction of new hospitals or the addition of new beds to existing hospitals. As a result, letters of intent for hospital projects involving new beds which were filed prior to February 11, 1983, which pursuant to Rule 10-5.08, Florida Administrative Code, would normally have an application deadline of March 15, were extended to a June 15 deadline with a review in September. Letters of intent which were received after February 14 and prior to May 16, which pursuant to the Department rules would have had a deadline of June 15, were instructed to file applications by August 15 to receive a November review. The moratorium, which was administratively imposed by the Department, had the effect of changing the application deadline the Petitioner's batching cycle from June 15, 1983, to August 15, 1983. In the absence of the Department's administrative moratorium, the Petitioner's applications would have been reviewed in the June 15 batch cycle pursuant to Rule 10-5.08, Florida Administrative Code. As a result of the administrative moratorium, the Department developed a letter of instructions which was forwarded to each of the 71 applicants who filed letters of intent between February 14 and May 16. The letter informed the applicants of the moratorium, the inapplicability of the June 15 deadline specified in the Department's rules, and requested applicants to file applications with the Department and appropriate local health council by August 15, 1983. The Department responded to Petitioner's letters of intent by forwarding letters of instruction dated May 18, 1983 and May 19, 1983. These two instruction letters were mailed to the Petitioner in the ordinary course of business by Ms. Diane Spooner, secretary to the certificate of need application review coordinator for the Department. Notwithstanding his receipt of the letters of instruction, the Petitioner forwarded his applications to the Department for review under cover letter dated June 10, 1983. These applications were received by the Department of June 15, 1983 and returned to the Petitioner. The Petitioner, however, did not receive the returned applications with cover letters or the application fees of $4,000 each from the Department. Subsequently, the Petitioner became aware that the applications were not included in the June or August batch and sent a letter to the Department requesting that the applications be included in the August batch. Neither the Department's rule nor Chapter 381, Florida Statutes, restrict an applicant from filing an early application. Accordingly, by filing its application on June 15, the Petitioner complied with the rules by filing on or before August 15. Had the Petitioner's applications been included in the August 15 batch cycle, its applications would have been comparatively reviewed with applications from Horsham Corporation in Palm Beach County and Citrus Community in Marion County.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That a final order be entered by the Department placing the Petitioner within the batching cycle for which applications were due by August 15, 1983, and within ninety days, comparatively review the Petitioner's applications with those competitive applications filed and accepted by the Department for the August 15, 1983 batch. DONE and ENTERED this 6th day of June, 1984, in Tallahassee, Florida. SHARYN L. SMITH 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 6th day of June, 1984. COPIES FURNISHED: Kenneth G. Oertel, Esquire Oertel and Hoffman 646 Lewis State Bank Building Tallahassee, Florida 32301 Doug Mannheimer, Esquire Post Office Drawer 591 Tallahassee, Florida 32302
Findings Of Fact Medicaid is a joint program funded by the federal government and by the state of Florida, and administered pursuant to both state and federal statutes and rules. All services or goods billed to the program must be necessary, Medicaid compensable, and must also have actually been provided to eligible recipients by providers prior to submitting claims. The Florida Medicaid Program (the "Program") is administered by the Department. Pharmacies are among the health care providers that participate in the Program. Providers participating in the Program are subject to routine audits by the Department. Any payments made by the Program for goods or services not actually provided to an eligible recipient are subject to recoupment by the Department and the provider is also subject to the imposition of administrative fines and exclusion from the program for a specified period of time. At all times pertinent to this proceeding, the Department's Office of Program Integrity 3/ was responsible for insuring that the goods and services billed to the Program were actually provided to Medicaid recipients. Westchester is a community pharmacy located in an Hispanic section of Miami, Florida. Westchester qualifies as a small business party for purposes of Section 57.111, Florida Statutes. Most of Westchester's customers have limited financial resources and many of them cannot afford medications unless paid for by the Medicaid Program. Westchester began participating in the Program in approximately 1982. There is no evidence of record to establish that Westchester was ever charged with overbilling the Medicaid program prior to 1988. In early 1988, the Department's Office of Program Integrity authorized a review of Westchester's Medicaid billings for the period from March 1, 1987 through December 31, 1987. The review was conducted by the Foundation for Health Care, Inc. ("FHC"), the contract auditor for the Department's Office of Program Integrity. In performing its review, FHC used a computerized data base to determine the number of units of each of the drugs sold by Westchester and billed to the Program during the audit period. Next, FHC reviewed all of Westchester's purchase data to determine the number of units of each drug purchased by Westchester during the audit period. FHC then used an across-the- board Medicaid percentage of 54 percent to estimate the available units of the various drugs on hand for dispensing to Medicaid recipients. As a result of its review, FHC concluded that Westchester had overbilled the Medicaid program for prescription drugs dispensed to program recipients during the review period. Westchester learned of the methodology being utilized by FHC while the review was being conducted. Through its attorney, Westchester objected to the methodology as being unsound. Westchester specifically advised that the Medicaid percentage for individual drugs varied from drug to drug and, accordingly, the application of an across-the-board Medicaid percentage was inaccurate. Notwithstanding Westchester's objections to the methodology, the Department, based upon FHC's review, sent a recoupment and sanction letter to Westchester dated July 20, 1988 (the "Audit Letter") seeking recoupment for alleged overpayments in the amount of $28,649.99. The Audit Letter set forth the Department's intent to impose an administrative fine of $7,162.49 on Westchester and indicated that the Department intended to suspend Westchester from the Medicaid Program for three months. The Audit Letter outlined the methodology utilized by the Department in calculating the alleged overpayment. The Audit Letter suggested that Westchester failed to supply adequate documentation to FHC regarding the source of drugs purportedly dispensed to Medicaid recipients which were subsequently billed to and reimbursed by Medicaid. Westchester challenged the Department's audit methodology and requested a formal administrative hearing on the conclusions in the Audit Letter and the imposition of administrative sanctions. The case was referred to the Division of Administrative Hearings ("DOAH") where it was assigned DOAH Case No. 88-4955 (the "Initial Case"). The Initial Case was assigned to Hearing Officer Jose A. Diez-Arguelles. While the Initial Case was pending, the Department proceeded to hearing on a similar case involving another pharmacy. In that other case, David's Pharmacy v. Department of Health and Rehabilitative Services, DOAH Case No. 88-1668 (Final Order entered September 15, 1988), the Department's attempt to establish an overpayment utilizing a similar methodology to that outlined in the Audit Letter was specifically rejected. The Final Order in the David's Pharmacy case approved a Recommended Order issued by Hearing Officer Donald Conn which found that the Department had "failed to explicate its policy by failing to produce evidence that would establish a rational, reasonable basis for the procedure utilized in this case...as follows therefore, the [Department] has not explicated its non-rule policy which was used in this case to conduct the audit of [David's Pharmacy], and as such there is no basis upon which to conclude that [the Department] has shown that [David's Pharmacy] was overpaid for Medicaid claims submitted during the audit." 4/ The results in the David's Pharmacy case apparently prompted the Department to rethink the advisability of proceeding to hearing on the methodology outlined in the Audit Letter. In a letter to Westchester dated November 23, 1988, the Department advised that it was withdrawing the Audit Letter. In view of this withdrawal, Westchester filed Petitioner's Amended Motion for Summary Final Order Determining No Medicaid Overpayment and To Relinquish Jurisdiction in the Initial Case. The Department filed a Response to the Amended Motion agreeing to the relinquishment of jurisdiction, but specifically objecting to the entry of a summary final order and/or any determination by the Hearing Officer that there was no overpayment. On January 25, 1989, Hearing Officer Jose A. Diez-Arguelles entered an Order Relinquishing Jurisdiction and Closing File (the "Closing Order") in the Initial Case. As set forth in that Closing Order, the Department's November 23, 1988 letter to Westchester stated that the Department was withdrawing the Audit Letter "...because of [Westchester's] objections to the methodology employed by [the Department] in determining the overpayment. The letter further indicates that the methodology objected to resulted in an approximation and was used because [Westchester] had not provided the necessary information to make a precise calculation. Further, the letter gave [Westchester] 60 days to provide the information needed to make a precise calculation." The Closing Order specifically denied Westchester's request for a summary final order determining that there was no overpayment. Instead, the Closing Order concluded that the Department's Audit Letter was the "equivalent of an administrative complaint and the withdrawal of the letter should be treated as the filing of a voluntary dismissal..." Because there were no pending disputed issues of material fact, Hearing Officer Diez-Arguelles relinquished jurisdiction over the matter to the Department. It is clear that the Closing Order anticipated further proceedings and/or negotiations between the parties before the underlying dispute would be conclusively resolved. Westchester filed a Petition for Attorney's Fees (the "First Petition") under the FEAJA following the entry of the Closing Order by Hearing Officer Diez-Arguelles. That First Petition was assigned DOAH Case No. 89- 0342F. At the time the First Petition was filed, no Final Order had been entered by the Department in the Initial Case. On March 3, 1989, Hearing Officer William R. Dorsey entered a Final Order in DOAH Case No. 89-0342F denying the First Petition. Essentially, Hearing Officer Dorsey concluded that the First Petition was premature since the underlying dispute between the parties had not been concluded in favor of Westchester. While noting Hearing Officer Diez-Arguelles' analogy of the November 23, 1988 letter to a "voluntary dismissal", Hearing Officer Dorsey stated that the letter and resulting Final Order were "more akin to an order allowing the Department to amend its claim for overpayment." Hearing Officer Dorsey's Final Order noted "[o]nly after the audit of the pharmacy's accounts for the period March 1, 1987, through December 31, 1987, is completed, and any administrative action is concluded, will it be possible to determine whether Westchester is a prevailing small business party." Subsequent to the entry of Hearing Officer Dorsey's Final Order, the Department entered a Final Order in the Initial Case. That Final Order was dated March 8, 1989, (filed on March 9, 1989) and adopted the findings and conclusions contained in Hearing Officer Diez-Arguelles' Closing Order. The Department's Final Order directed Westchester to provide additional information so that a more precise calculation could be made of the amount of the alleged overpayment. Westchester appealed the Final Order in the Initial Case contending that the Department should not be permitted to conduct an additional audit of the March 1, 1987 through December 31, 1987 period. Westchester also appealed Hearing Officer Dorsey's Final Order on the First Petition seeking attorney's fees. After the entry of the Department's Final Order, Westchester filed another Petition for Attorney's Fees (the "Second Petition") which was assigned DOAH Case No. 89-2532F (one of the Pending Cases). That case was placed in abeyance while the underlying issues and appeals were resolved. Apparently, the appeal from the Department's Final Order in the Initial Case and the appeal from Hearing Officer Dorsey's Final Order denying attorney's fees were consolidated. The Department moved to dismiss both appeals, arguing, among other things, that the appeals were premature because the underlying dispute had not been resolved. On April 18, 1990, the Third District Court of Appeal entered an Order granting the Department's Motion to Dismiss Appeals of Non-Final Non-Appealable Orders. The Appellate Court's Order stated that the appeals were "dismissed without prejudice." While the appeals were pending before the Third District Court of Appeal, the Department employed the public accounting and management consulting firm of KPMG Peat Marwick ("KPMG") to conduct a further review of Respondent's Medicaid billings. The KPMG review was conducted during the latter part of 1989 and included the development of a methodology which utilized a Medicaid percentage for individual drugs based upon an analysis of prescriptions of all drugs in question to determine the portion of each drug's total sales that went to Medicaid recipients, a calculation of the total units claimed for each drug for which Westchester sought reimbursement during the audit period, and a calculation of the total units purchased by Westchester for each drug claimed for reimbursement during the audit period. The Medicaid percentage of each drug was then applied to total purchases of that drug to determine the amount of the drug that was on hand at Westchester for dispensing to Medicaid recipients. 5/ Based upon its review, KPMG concluded that Westchester had been overpaid by the Program. KPMG initially calculated the overpayment at more than $30,000.00. After an exchange of information between KPMG and Westchester, a revised audit report was prepared dated August 30, 1990. That revised audit report sought recoupment from Westchester of an alleged overpayment of $21,939.93. It also sought to impose a $2,000 administrative fine on Westchester and sought to terminate Westchester from the Medicaid program for at least two years. Westchester complains that the Department increased the suspension sought in the re-audit from that sought in the initial Audit Letter as retribution for Westchester's challenge to the methodology. The record does not support this contention. The Department has adequately explained the difference in the sanctions. While the suspension sought after the re-audit was greater, the penalties sought in the initial Audit Letter were based solely upon Westchester's purported failure to provide complete information and not upon any overpayment. In any event, the difference is irrelevant since, as noted below, the Department was ultimately unsuccessful in imposing any sanctions against Westchester. Westchester challenged the results of the re-audit. That challenge resulted in a new administrative proceeding, DOAH Case No. 89-7004. Hearing Officer Donald Conn conducted a formal hearing pursuant to Section 120.57, Florida Statutes, in DOAH Case No. 89-7004 on September 5, 6 and 24, 1990 following which he issued a Recommended Order dated January 18, 1991 (the "Recommended Order"). As noted above, Hearing Officer Conn had previously presided over the administrative hearing in the David's Pharmacy case and found the methodology utilized by the Department in that case to try to establish the amount of overpayment to be flawed. However, in the Recommended Order in Case No. 89- 7004, Hearing Officer Conn concluded that the KPMG methodology was statistically valid. Specifically, the Recommended Order found that "KPMG and the [Department] utilized generally accepted statistical sampling methods and aggregate analysis in conducting their review of [Westchester's] Medicaid billing." The re-audit procedures are explained in detail in the Recommended Order entered in DOAH Case No. 89-7004. A review of the transcript of the hearing indicates that the calculation of the overpayment was not only statistically valid, it was conservative in favor of the pharmacy. The Recommended Order specifically found that Westchester had "...failed to maintain complete and accurate records of purchases of drugs from suppliers, as well as bartered exchanges, for a period of five years from billings. Therefore, it was unable to provide the [Department] with complete documentation supporting all billings during the review period. Notwithstanding the cooperative attitude evidenced by [West- chester's] owner and operator, Francis Larin, during this proceeding, [Westchester] has failed to comply with Rules 10C-7.030(8) and 10C-7.042(16), Florida Administrative Code. Those Rules require Medicaid providers to maintain, for a period of five years from the date of billing, complete and accurate records that fully justify and disclose the extent of services rendered and billings made, and to furnish the Department with all of the information regarding claims for the purpose of claims' audit and review." Subsequent to the Formal Hearing in DOAH Case No. 89-7004, but before the entry of the Recommended Order, the Department issued an amended recoupment letter dated October 17, 1990, which limited the recoupment being sought to the top 100 drugs by dollar volume of claim, plus their generic equivalents. This resulted in the elimination of many individual drugs with relatively small overpayments from the list of overpayments, and left only five instances among those top 100 drugs where the difference between the quantity available, adjusted for standard error, and the quantity claimed was less than 100 units. In many instances, the difference was well in excess of a thousand units. The amount of the alleged overpayment according to this amended recoupment letter was $12,643.11. As a result of an error in calculating the top 100 drugs and equivalents, the Department issued a "second amended recoupment letter" dated October 26, 1990, further reducing the administrative fine sought to $1200 and reducing the proposed termination period to 14 months. The Recommended Order determined that Westchester had provided competent substantial evidence at the hearing to establish some purchases for certain drugs that were not considered by KPMG or the Department. As a consequence, the Recommended Order concluded that the overpayment established by the Department at the hearing was $2,902.19 less than the $12,643.11 claimed in the Second Amended Recoupment Letter. Because the Department failed to properly explicate its non-rule sanctions policy, the Recommended Order concluded that no sanctions should be imposed against Westchester. In other words, Hearing Officer Conn concluded that, in the absence of any applicable rules delineating the Department's sanctions policy, the failure to properly explicate the sanctions policy at hearing precluded the imposition of any sanctions against Westchester. In summary, the Recommended Order concluded that the Department should enter a Final Order requiring Westchester to repay the Medicaid program $9,704.92 for Medicaid overbilling during the audit period, but should not impose any sanctions against Westchester. The Recommended Order was adopted in full by the Department in a Final Order entered on March 22, 1991. Westchester did not appeal the Final Order entered in DOAH Case No. 89-7004. Westchester filed a Petition For Award of Section 57.111 Attorneys' Fees and Costs Relating to the Third Audit of Westchester Pharmacy and Request for Evidentiary Hearing (the "Third Petition") following the entry of the Final Order in DOAH Case No. 89-7004. The Third Petition for Attorney's Fees was assigned DOAH Case No. 91-3135F (one of the Pending Cases). That case was ultimately transferred to the undersigned Hearing Officer. As set forth in an Order entered on May 30, 1991, DOAH Case Nos. 89- 2532F, 90-6900F, 6/ and 91-3135F were not formally consolidated, but it was agreed that a hearing on the cases would be conducted concurrently. As noted above, the parties have requested a dtermination whether the Pending Cases (DOAH Case Nos. 89-2532F and 91-3135F) could be disposed of without the need for a formal evidentiary hearing. In this regard, the parties submitted the various motions and background documents set forth in the Preliminary Statement.
