The Issue Whether the State of Florida through its Employees Group Health Self Insurance Plan is responsible for paying medical expenses incurred by Petitioner's newborn child where Petitioner had only individual coverage in effect at the time of that child's birth?
Findings Of Fact The State of Florida makes available to its employees several group insurance programs. In the area of health insurance, employees may choose to participate in the State of Florida Employees Group Health Self Insurance Plan, or they may enroll in a number of different HMOs depending upon the county in which each employee resides. The State of Florida Employees Group Health Self Insurance Plan (hereinafter "the Plan") is a plan of self insurance established by the State, specifically described in a Benefit Document, and administered by Blue Cross/Blue Shield. In addition to the provisions of the Plan embodied in the Benefit Document, the self insurance plan is regulated by those rules contained in Chapter 22K, Florida Administrative Code. If an employee voluntarily chooses to participate in the Plan, the State as the employer contributes to the employee's costs by paying a portion of the premium for each employee. HMOs wishing to capture a portion of the State employee insurance market may participate in bidding procedures whereby the winner(s) can offer insurance to State employees in particular geographical locations. Winning HMOs must comply with many of the rules and provisions involved in the Plan but are still able to establish additional benefits and requirements for coverage. If an employee voluntarily chooses to participate in an HMO insurance program, the State will assist with the employee's costs by contributing to that employee's insurance premium expense. At the time that they commence employment with the State, employees may elect to participate in the Plan, in one of the HMOs approved for that particular geographical location, or may choose to not participate in any of the voluntary insurance programs offered through the State. Thereafter, employees may only join one of the insurance programs or switch between programs during an annual open enrollment period. An employee may purchase individual coverage, insuring only himself or herself, or an employee may purchase family coverage, insuring that employee and one or more of his or her eligible dependents. During an open enrollment period, an employee may switch between individual coverage and family coverage for the following year. Under the State Plan, there is an exception to the restriction that employees may only change coverage and health plans during the open enrollment period. An employee having individual coverage may change to family coverage within 31 days after the date of acquisition of any eligible dependent. In that event, coverage for the eligible dependent does not relate back to the date of acquisition but rather will commence on some future date following the payment of the additional premium required for the additional family coverage. Similarly, an employee with only individual coverage may begin family coverage prior to acquiring eligible dependents and may obtain coverage for those dependents effective on the actual date the dependent is acquired by making application in time for a complete month's premium to be deducted prior to the first day of the month during which the dependent(s) will be acquired. In other words, payment must be made prior to the acquisition of an eligible dependent and the change to family coverage with its increased premium must be made prior to the acquisition of the dependent in order that coverage can be effective as of the date of acquisition. During open enrollment periods, all employees (even those not currently participating in any of the insurance programs offered by the State) are given summary information regarding the various programs in which they are being given an opportunity to participate. Brochures giving summarized comparisons of the Plan and the relevant HMOs are provided to all employees. Employees are advised, if they have questions regarding the Plan, to contact their personnel officer or the Division of State Employees' Insurance. After the employee makes a selection as to which health plan he or she wishes to participate in, if any, the employee will subsequently receive more detailed information about that plan. For example, an employee choosing to participate in the Plan will subsequently receive a copy of the State of Florida Employees Group Health Self Insurance Plan Brochure. The first page of that Brochure specifically advises the employee that the brochure does not include all of the provisions, definitions, benefits, exclusions, and limitations of the Plan. The Brochure specifically advises the employee that it is a summary of the benefits and that any questions the employee might have should be presented to the employee's agency personnel offices or the Office of State Employees' Insurance, and provides that latter office's address and telephone numbers. The Plan itself is a lengthy document which is not distributed to each individual employee but rather is made available to each agency's personnel office for reference by any interested employee. Under the Plan, a woman with individual coverage is entitled to maternity or pregnancy benefits. As part of those benefits, charges for "well baby care," i.e., the charges for the nursery for the baby, are covered under the Plan as part of the maternity benefit of the mother. In well-baby care, charges are not incurred by the baby as a separate patient. On the other hand, if a baby is ill and is admitted to the hospital as a patient in its own right, well-baby care coverage does not apply, and family coverage must be in effect or the infant will be an uninsured individual under the State Plan. The Dade County Public Defender's Office has approximately 265 employees. Faith Quincoses, an Administrative Assistant in that office, began her employment there in 1981 when the office had approximately 165 employees. As the number of office personnel increased, it was determined that someone within that Office should be responsible for employee benefits. That assignment was given to Quincoses, who at the time had duties related to payroll. Quincoses had no training in employee benefits, particularly employee insurance benefits, prior to her assuming responsibility for those duties at the Dade County Public Defender's Office. After she assumed those duties, the Public Defender's Office provided her with no training, and that office did not send her to any of the training sessions regularly conducted by Respondent for employees with and without personnel duties, including those seminars related to employee insurance benefits. When Quincoses would receive informational brochures and memoranda from Respondent regarding employee insurance benefits, she would read them but intentionally did not study them. She did not believe it was her responsibility to assist employees in selecting a particular insurance plan, or in advising employees as to which plan best met that employee's needs, or in answering any specific questions regarding coverage that any employee may have other than routine questions. Although many, if not most, of the informational brochures received from time to time by Quincoses advised employees (including Quincoses) to contact the Division of State Employees' Insurance with any questions regarding benefits and coverage, Quincoses did not contact that office when she had questions about the several insurance plans offered by the State to its employees. She very seldom contacted the Division of State Employees' Insurance to ask questions; rather, she discussed insurance benefits and coverage questions on an almost daily basis with a payroll clerk who worked for the Justice Administrative Commission, an agency belonging to the judicial branch of government with no responsibility or authority for administering the various insurance programs for state employees. Although Quincoses knew that she did not posses a copy of the State of Florida Employees Group Health Self Insurance Plan and had never read a copy, she made no effort to obtain a copy other than to once request a copy from the payroll clerk she daily contacted at the Justice Administrative Commission. When told by that payroll person that she did not have a copy of the Plan, Quincoses made no further efforts to obtain a copy and never requested a copy from the Division of State Employees' Insurance. Quincoses knew she was not an insurance expert and did not feel the need to become one. She believed that her responsibilities regarding the various insurance programs made available to employees by the State of Florida was to simply disseminate information provided to her, fill out the appropriate forms for payroll deductions, answer routine questions, and refer specific questions to the Division of State Employees' Insurance. She rightfully believed that each employee's decision as to which of the individual plans that employee should select was the employee's responsibility. Petitioner Annemarie Harris is an attorney employed as an Assistant Public Defender by the Dade County Public Defender's Office since October, 1983. As a new employee, she chose to enroll in one of the group health insurance programs approved by the State. She chose to join an approved HMO plan rather than enroll in the State of Florida Employees Group Health Self Insurance Plan. Thereafter, and up through December of 1987, each year during the open enrollment period, Petitioner chose to participate in one of the approved HMOs rather than the State's Self Insurance Plan. In December of 1987, the contract between the HMO of which Petitioner was a member and the State of Florida was being terminated, and Petitioner therefore had the option of selecting to participate in one of the other group health insurance programs offered through the State of Florida. In December of 1987, Petitioner was three months pregnant. Her baby was due to be born approximately June 20, 1988. Petitioner was, therefore, very interested in the most extensive coverage which she could obtain for her maternity benefits. Petitioner advised Quincoses that her expected delivery date was June 20, 1988, and that she wished her newborn to be covered by the insurance policy to be selected by Petitioner. Quincoses advised Petitioner that the baby's expenses would be covered if Petitioner added the newborn baby to Petitioner's coverage within 31 days after the date the baby was born. Quincoses did not advise Petitioner that waiting until after the baby's birth would mean that the baby would not be an individual insured until after Petitioner had paid the premium in time for the baby to be added as an insured by the first day of a month subsequent to the baby's birth, since Quincoses did not understand that distinction. The information Quincoses gave Petitioner was wrong and is not contained in any of the written materials describing the Plan which had been transmitted by the State to Quincoses or Petitioner, and is contrary to the information contained in Chapter 22K, Florida Administrative Code. Petitioner then conducted her own investigation of which health plan she wished to choose by asking her friends that worked in the Public Defender's Office about their personal experiences. Further, as Petitioner testified at the final hearing in this cause, Petitioner's husband strongly insisted that she choose the State's Self Insurance Plan in which Plan he had previously participated as a State employee and with which he therefore had some familiarity. Petitioner did not contact the Division of State Employees' Insurance regarding her specific questions and specific situation, did not consult the Benefit Document itself and did not--although both she and her husband are attorneys--consult the rules and regulations regarding coverage contained within Chapter 22K, Florida Administrative Code. Petitioner voluntarily selected the State's Self Insurance Plan and purchased only individual coverage, insuring herself at a lower premium than family coverage which would have covered the newborn infant as of the date of the baby's birth. It is unknown whether Petitioner relied solely on the advice of Quincoses in choosing to purchase individual coverage rather than family coverage, whether Petitioner relied instead on the advice she obtained from questioning her friends or whether she relied upon her husband's desires, in choosing to participate in the State Plan or in choosing to purchase only individual coverage. Although the basis for Petitioner's decision is unknown, her intentions at the time are clear. She planned to, and took steps to, initiate the paperwork necessary to switch to family coverage and pay the additional premium required early enough so that insurance for the baby would be in place on June 1, 1988, prior to the baby's expected arrival date. During April of 1988, Petitioner caused Quincoses to begin filling out the appropriate forms so that Petitioner would have family coverage in place as of June 1, 1988. Since Quincoses had earlier advised Petitioner that Petitioner could switch to family coverage after the baby's birth (which would make the baby's coverage effective subsequent to the baby's birth) but Petitioner chose instead to attempt to convert to family coverage prior to the baby's birth (which was contrary to Quincoses' advice and would have established coverage immediately upon the baby's birth), it can be reasonably inferred that Petitioner understood that the difference between converting to family coverage prior to the baby's birth rather than subsequent to the baby's birth involved the sole issue of the date on which the baby's coverage would become effective. Although Quincoses initiated the paperwork to have family coverage in place for Petitioner prior to the baby's birth expected to occur on June 20, 1988, Petitioner experienced complications with her pregnancy causing the baby to be delivered prematurely on April 24, 1988, prior to Petitioner signing and processing the paperwork started by Quincoses. Almost immediately after the baby's birth, the baby was transferred from the hospital in which her mother was a patient to another hospital where the baby was admitted as a separate patient. The baby remained in that hospital for some time, incurring medical expenses of approximately $180,000.00. Petitioner's medical expenses were paid by the Plan pursuant to her individual coverage. The baby's medical expenses were submitted to the Plan. Petitioner's claim for payment of the baby's medical expenses was denied for the reason that the baby was admitted to a different hospital than the mother as a separate patient but was not an insured under any insurance policy as of the date of the baby's birth, the date on which the baby commenced incurring her own personal medical expenses. When Petitioner converted her individual coverage to family coverage subsequent to the baby's birth, her claims for payment of the baby's medical expenses incurred subsequent to the date upon which the baby became an insured under the State Plan were denied since they arose from a condition pre-existing the date of commencement of insurance coverage. On April 24, 1988, Petitioner's newborn child was not an insured under the State Plan since Petitioner only had individual coverage on that date.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is, RECOMMENDED that a Final Order be entered denying Petitioner's claims for payment of medical expenses incurred by Petitioner's newborn baby which are the subject of this proceeding. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 27th day of October, 1989. LINDA M. RIGOT 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 27th day of October, 1989. APPENDIX TO RECOMMENDED ORDER, CASE NO 88-5519 Petitioner's proposed Findings of Fact numbered 1-4, 7-9, 15-18, 34, 35, 37, 38, and 40-42 have been adopted either verbatim or in substance in this Recommended Order. Petitioner's proposed Findings of Fact numbered 5, 6, 10-12, 21, and 33 have been rejected as not being supported by the weight of the credible evidence in this cause. Petitioner's proposed Findings of Fact numbered 13, 14, 39, 44, and 45 have been rejected as being subordinate to the issues for determination herein. Petitioner's proposed Findings of Fact numbered 19 and 22-25 have been rejected as not constituting findings of fact but rather as constituting recitation of the testimony, argument of counsel, or conclusions of law. Petitioner's proposed Findings of Fact numbered 20, 26-31, and 43 have been rejected as being irrelevant to the issues under consideration herein. Petitioner's proposed Finding of Fact numbered 32 has been rejected as being contrary to the weight of the totality of the evidence in this cause. Petitioner's proposed Finding of Fact numbered 36 has been rejected as being unnecessary for determination of the issues involved herein. Respondent's proposed Findings of Fact numbered 1-5, 7-18, the second 19-24, the first 27, the second 26, the second 27, and 28 have been adopted either verbatim or in substance in this Recommended Order. Respondent's proposed Findings of Fact numbered 6, the first 19, 25, and the first 26 have been rejected as being subordinate to the issues required to be determined in this proceeding. COPIES FURNISHED: James N. Hurley, Esquire William P. Harris, Jr., Esquire Mitchell, Harris, Horr & Associates 2650 Biscayne Boulevard Miami, Florida 33137-4590 William A. Frieder, Esquire Department of Administration Office of the General Counsel 440 Carlton Building Tallahassee, Florida 32399-1550 A. J. McMullian, III Interim Secretary Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550 Augustus D. Aikens, Jr. General Counsel Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550 =================================================================
The Issue The issue for determination in this case is whether certain provisions of the Florida Title XIX Long-Term Care Reimbursement Plan, as adopted in Rule 59G-6.010, Florida Administrative Code, which are relied upon by the AGENCY FOR HEALTH CARE ADMINISTRATION to apply a fair rental value system of property reimbursement to Petitioner are invalid under Section 120.56, Florida Statutes (1995). Petitioner also asserts a state and federal constitutional equal protection challenge to the existing rule provisions. (Petitioner’s constitutional issues are preserved, but are not determined in this proceeding.)
Findings Of Fact Petitioner, CONSULTING MANAGEMENT AND EDUCATION, INC., d/b/a GULF COAST NURSING AND REHABILITATION CENTER (CME), is the licensed operator of a 103-bed nursing home in Clearwater, Florida, which is presently known as GULF COAST NURSING AND REHABILITATION CENTER (GULF COAST). CME participates in the Florida Medicaid Program as an enrolled provider. Respondent, AGENCY FOR HEALTH CARE ADMINISTRATION (AHCA), is the agency of the State of Florida authorized to implement and administer the Florida Medicaid Program, and is the successor agency to the former Department of Health and Rehabilitative Services, pursuant to Chapter 93-129, Laws of Florida. Stipulated Facts Prior to 1993, the GULF COAST nursing home facility was known as COUNTRY PLACE OF CLEARWATER (COUNTRY PLACE), and was owned and operated by the Clearwater Limited Partnership, a limited partnership which is not related to CME. In 1993 CME agreed to purchase, and did in fact purchase, COUNTRY PLACE from the Clearwater Limited Partnership. Simultaneous with the purchase of COUNTRY PLACE, CME entered into a Sale/Leaseback Agreement with LTC Properties, Inc., a Maryland real estate investment trust which engages in the financing of nursing homes. The Purchase and Sale Agreement between Clearwater Limited Partnership and CME was contingent upon the Sale/Leaseback Agreement and the proposed Lease between CME and LTC Properties, Inc. On September 1, 1993, CME simultaneously as a part of the same transaction purchased COUNTRY PLACE, conveyed the facility to LTC Properties, Inc., and leased the facility back from LTC Properties, Inc. As required, CME had notified AHCA of the proposed transaction. AHCA determined that the transaction included a change of ownership and, by lease, a change of provider. CME complied with AHCA's requirements and became the licensed operator and Medicaid provider for COUNTRY PLACE. Thereafter, CME changed the name of the facility to GULF COAST. After CME acquired the facility and became the licensed operator and Medicaid provider, AHCA continued to reimburse CME the same per diem reimbursement which had been paid to the previous provider (plus certain inflation factors) until CME filed its initial cost report, as required for new rate setting. In the normal course of business, CME in 1995 filed its initial Medicaid cost report after an initial period of actual operation by CME. Upon review of the cost report, AHCA contended that the cost report was inaccurate and engaged in certain "cost settlement" adjustments. During this review, AHCA took the position that CME's property reimbursement should be based on FRVS methodologies rather than "cost" due to the lease. In November of 1995, CME received from AHCA various documents which recalculated all components of Petitioner's Medicaid reimbursement rates for all periods subsequent to CME's acquisition of the facility. In effect, AHCA placed CME on FRVS property reimbursement. The practical effect of AHCA's action was to reduce CME's property reimbursement both retroactively and prospectively. The retroactive application would result in a liability of CME to AHCA, due to a claimed overpayment by AHCA. The prospective application would (and has) resulted in a reduction of revenues. CME is substantially affected by AHCA's proposed action and by Sections I.B., III.G.2.d.(1), V.E.1.h., and V.E.4. of the Florida Medicaid Plan. Additional Findings of Fact The Florida Medicaid Plan establishes methodologies for reimbursement of a nursing home's operating costs and patient care costs, as well as property costs. The dispute in this matter relates only to reimbursement of property costs. CME as the operator of the GULF COAST nursing home facility is entitled to reimbursement of property costs in accordance with the Florida Medicaid Plan. CME as the operator of the GULF COAST facility entered into a Florida Medicaid Program Provider Agreement, agreeing to abide by the provisions of the Florida Medicaid Plan. The Sale/Leaseback Agreement entered into by CME and LTC Properties Inc. (LTC) specifically provides for a distinct sale of the nursing home facility to LTC. LTC holds record fee title to GULF COAST. LTC, a Maryland corporation, is not related to CME, a Colorado corporation. The Florida Medicaid Plan is intended to provide reimbursement for reasonable costs incurred by economically and efficiently operated facilities. The Florida Medicaid Plan pays a single per diem rate for all levels of nursing care. After a nursing home facility's first year of operation, a cost settling process is conducted with AHCA which results in a final cost report. The final cost report serves as a baseline for reimbursement over the following years. Subsequent to the first year of operation, a facility files its cost report annually. AHCA normally adjusts a facility's reimbursement rate twice a year based upon the factors provided for in the Florida Medicaid Plan. The rate-setting process takes a provider through Section II of the Plan relating to cost finding and audits resulting in cost adjustments. CME submitted the appropriate cost reports after its first year of operation of the GULF COAST facility. Section III of the Florida Medicaid Plan specifies the areas of allowable costs. Under the Allowable Costs Section III.G.2.d.(1) in the Florida Title XIX Plan, a facility with a lease executed on or after October 1, 1985, shall be reimbursed for lease costs and other property costs under the Fair Rental Value System (FRVS). AHCA has treated all leases the same under FRVS since that time. AHCA does not distinguish between types of leases under the FRVS method. The method for the FRVS calculation is provided in Section V.E.1.a-g of the Florida Medicaid Plan. A “hold harmless” exception to application of the FRVS method is provided for at Section V.E.1.h of the Florida Medicaid Plan, and Section V.E.4 of the Plan provides that new owners shall receive the prior owner’s cost-based method when the prior owner was not on FRVS under the hold harmless provision. As a lessee and not the holder of record fee title to the facility, neither of those provisions apply to CME. At the time CME acquired the facility, there was an indication that the Sale/Leaseback transaction with LTC was between related parties, so that until the 1995 cost settlement, CME was receiving the prior owner’s cost-based property method of reimbursement. When AHCA determined that the Sale/Leaseback transaction between CME and LTC was not between related parties, AHCA set CME’s property reimbursement component under FRVS as a lessee. Property reimbursement based on the FRVS methodology does not depend on actual period property costs. Under the FRVS methodology, all leases after October 1985 are treated the same. For purposes of reimbursement, AHCA does not recognize any distinction between various types of leases. For accounting reporting purposes, the Sale/Leaseback transaction between CME and LTD is treated as a capital lease, or “virtual purchase” of the facility. This accounting treatment, however, is limited to a reporting function, with the underlying theory being merely that of providing a financing mechanism. Record fee ownership remains with LTC. CME, as the lease holder, may not encumber title to the facility. The Florida Medicaid Plan does not distinguish between a sale/leaseback transaction and other types of lease arrangements. Sections IV.D., V.E.1.h., and V.E.4., the “hold harmless” and “change of ownership” provisions which allow a new owner to receive the prior owner’s method of reimbursement if FRVS would produce a loss for the new owner, are limited within the Plan’s organizational context, and within the context of the Plan, to owner/operators of facilities, and grandfathered lessee/operators. These provisions do not apply to leases executed after October 1, 1985. Capital leases are an accounting construct for reporting purposes, which is inapplicable when the Florida Medicaid Plan specifically addresses this issue. The Florida Medicaid Plan specifically addresses the treatment of leases entered into after October 1985 and provides that reimbursement will be made pursuant to the FRVS method. The Florida Medicaid Plan is the result of lengthy workshops and negotiations between the agency and the nursing home industry. The Florida Medicaid Plan complies with federal regulations.
The Issue The issue in this case is whether the expenses incurred by Petitioner incident to admission to Town & Country Hospital on December 11, 1999, resulted from an intentional self-inflicted injury, to wit: attempted suicide, and are therefore excluded from coverage under the State of Florida Employees Group Health Self Insurance Plan.
Findings Of Fact At all times pertinent hereto, Petitioner, Sarah Nuding, was employed by the University of South Florida and was a participant in the State of Florida Employees Group Health Self Insurance Plan (PPO). Respondent, Department of Management Services, Division of State Group Insurance (DSGI), administers the state's self- funded group insurance plan for employees and has secured the services of BCBS as its third party administrator. On December 11, 1999, Petitioner called the Hillsborough County Sheriff's office after ingesting a handful of Wellbutrin and four tablets of Neurontin. Deputy Sheriff Midarst initiated involuntary examination pursuant to Section 394.463, Florida Statutes, (Baker Act), and Petitioner was admitted through the emergency room to Town & Country Hospital, Tampa, Florida. Petitioner was placed in the Hospital's Intensive Care Unit for observation of her seizure activity and remained there under observation and treatment until her release on December 13, 1999. Upon admission and after examinations, Petitioner was diagnosed with chronic anemia by the admitting physician who ordered consultation with the treating physician before medical services and treatment were provided. The admitting and treating physician, after review of Petitioner's hematocrit and hemoglobin levels which were above that normally requiring hospitalization, determined that Petitioner should be treated for the anemia condition before her discharge on December 13, 1999. Petitioner's State of Florida Employees Group Health Self Insurance Plan Booklet and Benefit Document excludes coverage for services rendered for treatment of self-inflicted wounds, in pertinent part provides: The following are not Covered Services and Supplies under the Plan. The Participant is solely responsible for the payment of charges for all such services, supplies or equipment excluded in this Section. 5. Any services and supplies received due to the following circumstances: (b) Resulting from an intentional self- inflicted injury whether the Participant was sane or insane. An injury is intentionally self-inflicted if the Participant intended to perform the act that caused the injury regardless of whether the Participant intended to cause the injury. On or about July 31, 2000, BCBS notified DSGI that of the Hospital's statement totaling $8,244.00 for services and supplies rendered December 11-13, 1999, only $1,030.25 were directly related to a diagnosis of "anemia"; the remaining charges are for the diagnosis of "drug overdose" and are not covered expenses under the State PPO Plan. The decision by both BCBS and DSGI, to pay those charges related to Petitioner's diagnosis and treatment for anemia and to not pay those charges related to the suicide attempt, including two days intensive care unit cost of $1,150.00 per day, are supported by preponderance of the evidence, and is in accord with the terms and conditions of the insurance plan exclusion provision. Petitioner's position is that her prolonged hospital stay, medical treatment and supplies were: (a) not at her request and consent, (b) that her anemia condition was a pre- existing, and therefore, a covered condition, and (c) intensive care placement ($1,500.00 per day for two days) was not necessary to treat her pre-existing anemic condition, therefore, only her first day hospitalization expenses should have been excluded. However, Petitioner's position ignores the fact that her hospital admission was for a suicide attempt, and her stay resulted from the requirements of the Section 394.463, Florida Statutes, to wit: mandatory involuntary placement for 72 hours.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Management Services, Division of State Group Insurance, issue a final order dismissing with prejudice the petition for administrative review. DONE AND ENTERED this 14th day of August, 2001, in Tallahassee, Leon County, Florida. FRED L. BUCKINE 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 14th day of August, 2001. COPIES FURNISHED: Julia P. Forrester, Esquire Department of Management Services 4050 Esplanade Way, Suite 260 Tallahassee, Florida 32399-0950 Sarah C. Nuding 15501 Bruce B. Downs Boulevard Apartment 3705 Tampa, Florida 33647 Cynthia Henderson, Secretary Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950 Mallory Roberts, General Counsel Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950
The Issue Whether petitioner is entitled to benefits in excess of those paid under the Florida Employees Group Health Self-Insurance Program for medical services provided to his newborn-son at Shands Hospital during April, 1982.
Recommendation Based on the foregoing, it is RECOMMENDED: That petitioner's claim for payment of the $200.00 and $125.00 medical charges be granted; and that his remaining claims, which seek payment in excess of amounts allowed by the Approved Fee Schedule, be denied. DONE and RECOMMENDED this 29th day of April, 1983, in Tallahassee, Florida. R. L. CALEEN, JR. 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 29th day of April, 1983.
Findings Of Fact In December of 1985, the Petitioner and his dependents were covered by the State Employees Group Health Self Insurance Plan. Robert S. Coughlin, the Petitioner's nineteen-year-old dependent, was hospitalized in an out-of-state hospital from December 24, 1985, to December 26, 1985. The total expense for the hospitalization was $935.00. A claim for insurance benefits to cover the expense was received by the Insurance Plan administrator on August 10, 1987. The claim was filed by the hospital on behalf of the insured dependent, Robert S. Coughlin. The administrator for the Respondent refused to pay the claim as it was not submitted within the sixteen-month period set forth in the contract of insurance. The contract, which is referred to as the benefit document, contains a policy exclusion which provides that no payment shall be made under the Plan for claims made after the expiration of the sixteen-month time limit which begins to run from the date medical expenses are incurred. The hospital did not timely file the claim because a mix-up had occurred during the hospital admission concerning the patient's insurance coverage. The dependent, Robert S. Coughlin, was unconscious during his emergency out-of-state hospital admission. Either the hospital personnel or the dependent's friends mistakenly used the information on another insurance card located in the patient's wallet as the applicable insurance. As the hospital directly filed the claim with the first insurance company, processing delays within the first company caused the hospital to miss the filing deadline for the actual insurance benefits. The Petitioner, Charles R. Coughlin, was not made aware of the situation until after the sixteen-month dime period had expired, and the claim for payment had been refused by the Respondent.
The Issue The issues are (1) whether certain medical expenses incurred by petitioners' daughter should be covered under the state group health insurance program, and (2) whether the state is estopped from denying the claim based upon erroneous misrepresentations made by its agent.
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: Background Petitioner, Etta Aldridge, is a full-time employee of Sunland Training Center in Marianna, Florida and is a participant in the state group health insurance program (the plan). James Aldridge, her husband and also a petitioner in this cause, and Jerrilyn Aldridge, her daughter, are covered by the plan. On November 3, 1987, Jerrilyn, then around seventeen years of age, was severely injured in an automobile accident near her home in Greenwood, Florida. Among other things, she suffered a skull fracture, abrasions, crushed pelvis and hip, and punctured lungs and stomach. She was initially taken to a Marianna hospital for emergency treatment and then transferred to a Tallahassee hospital for longer-term care. While at the Tallahassee hospital, Jerrilyn was diagnosed by her neurologist as having a closed, diffuse brain injury and brain stem contusions. After Jerrilyn was treated in Tallahassee for two and one-half months, which included one month in the hospital and forty-five days at the hospital's extended care facility, her parents were advised that, due to her poor prognosis, they had a choice of putting her in a nursing facility or taking her to their home. Although Jerrilyn was still in a coma, petitioners decided to take her home and care for her in a bedroom which had been converted into a hospital room setting. After six or seven weeks at home, and contrary to earlier medical expectations, Jerrilyn opened her eyes, made noises and manifested some slight arm movement. Based upon these encouraging signs, petitioners sought further medical advice and were told that, given the foregoing signs of improvement, treatment in a facility that specialized in brain injury rehabilitation would improve their daughter's condition. Petitioners contacted the National Head Injury Foundation and were given a list of health care facilities in the state that provided rehabilitative services for brain injured patients. This list included Manatee Springs Nursing Center, Inc. d/b/a Mediplex Rehab-Bradenton (MRB), a facility licensed by the state as a skilled nursing facility but which specialized in rehabilitating brain injured patients. MRB is the largest brain injury rehabilitation facility in the southeastern united States. Since the Aldridges did not have the financial resources to pay for any additional treatment for Jerrilyn, it was essential that they selected a facility that would be covered by the plan. After James Aldridge spoke with and received information from most of the facilities on the list, and conferred with Jerrilyn's neurologist, he eventually narrowed his choice to several facilities, including MRB, which impressed him because of its good reputation and specialty in head injury rehabilitation. To confirm whether coverage would be provided for further treatment, James Aldridge telephoned the customer service unit of Blue Cross and Blue Shield of Florida, Inc. (BCBS), the plan's administrator. He also contacted MRB and authorized it to make an inquiry with BCBS on his behalf. On March 28, 1989 Aldridge received favorable advice from a BCBS service representative concerning coverage and benefits for Jerrilyn at MRB. This advice was independently confirmed by MBR on the same date, and Jerrilyn was accepted as a patient at the facility effective March 31, 1988. Some three months later, and after some of the bills had been paid, BCBS advised MBR and petitioners that a "computer" error had been made and that the requested benefits applied only when rendered in a licensed hospital and not a skilled nursing facility. BCBS accordingly declined to pay the bills. That prompted petitioners to initiate this proceeding. The bills in question total over $225,000. The Insurance Plan The State has elected to provide a self-insured group health insurance program for its employees and their dependents. The legislature has designated respondent, Department of Administration, Division of Employees' Insurance (Division), as the responsible agency for the administration of the plan. To this end, the Division has entered into an agreement with BCBS to administer the plan. Among other things, BCBS provides verification of coverage and benefits, claims payment services, actuarial and printing services, and medical underwriting of late enrollee applications. Including dependents and retirees, there are almost 300,000 persons who are covered by the plan. Upon enrolling in the plan, all employees, including Etta Aldridge, were routinely given an insurance card with BCBS's telephone number and a brochure entitled "State of Florida Employees Group Health Self Insurance Plan Brochure" (brochure) containing a general description of the plan. The brochure warns the insured that the brochure is not a contract since it does not include all the provisions, definitions, benefits exclusions and limitations of the plan. It also contains advice that if the brochure does not answer an employee's question, he should telephone the Division's customer service section in Tallahassee. In actual practice, however, if an employee contacts the Division number, he is told to telephone BCBS's customer service unit in Jacksonville regarding any questions as to coverage and benefits, claims or other problems concerning the plan. The Division generally becomes involved only when an employee is unable to resolve a claims problem with BCBS. BCBS has established a service unit that deals exclusively with inquiries regarding coverage and benefits under the state group health plan. There are approximately twenty- eight service representatives in that unit. Each representative receives four weeks of training before being certified as a customer service representative. After being certified, a representative's primary responsibility is to respond to inquiries from state employees, health providers and physicians regarding verification of benefits and coverage under the state group policy. It should be noted that a distinction exists between verification of benefits and coverage. To verify coverage means to verify that a person has an active policy at the time services are rendered. To verify benefits means to confirm that a specific service is covered under the policy. In this case, there was an inquiry by the insured and provider regarding both benefits and coverage. In the event a representative is unsure as to the licensing status of a facility or provider, the representative has access to BCBS's master registry department which maintains the provider number and licensure status of every facility in the state. That registry identified MRB as a skilled nursing home. BCBS representatives have the authority to make decisions regarding benefits and coverage. It is only when an inquiry falls within a "grey area" that the final decision is referred from the unit to either the Legal or Medical Division of BCBS. The Division, with the assistance of BCBS, has prepared a seventy-five page benefit document (document) which governs all claims arising under the plan. However, the document is for BCBS in-house use only and is not given to state employees or providers. The document first became effective on May 1, 1978 and has been subsequently amended from time to time. When Jerrilyn was admitted to MRB, the document effective October 1, 1987 was controlling. The document was further amended effective July 1, 1988, which was three months after her admission to MRB. As is pertinent here, the July 1, 1988 amendments increased the deductibles and narrowed the definition of a "hospital". According to the state benefits administrator, the document is "the final word" on any dispute regarding coverage or claims. The BCBS service unit uses this document to verify coverage and benefits. Included in the document are numerous definitions that are used to resolve disputed claims. Relevant to this controversy is the definition of a hospital at the time Jerrilyn was admitted to MRB: "Hospital" means a licensed institution engaged in providing medical care and treatment to a patient as a result of illness or accident on an inpatient/outpatient basis at the patient's expense and which fully meets all the tests set forth in 1., 2., and below: It is a hospital accredited by the Joint Commission on the Accreditation of Hospitals, or the American Osteopathic Association or the Commission on the Accreditation of Rehabilitative Facilities; It maintains diagnostic and therapeutic facilities for surgical or medical diagnosis and treatment of patients under the supervision of a staff of fully licensed physicians; It continuously provides twenty-four (24) hour a day nursing service by or under the supervision of registered graduate nurses. It is undisputed that, while MRB may have provided many services comparable to those rendered by a licensed hospital and is considered to be an atypical nursing home, MRB is still licensed by the state as a skilled nursing facility. Thus, MRB cannot qualify as a hospital under the benefit document. Payment for services in a skilled nursing facility, such as MRB, are much more limited and restrictive than for a hospital. To qualify for payment of benefits in a skilled nursing facility, the insured must have been hospital confined for at least three consecutive days prior to the day of hospital discharge before being transferred, upon a physician's advice, to a skilled nursing facility. Once admitted to such a facility, the insured's room and board reimbursement is limited to a maximum of $76 per day. Further, payment of services and facilities is limited to sixty days of confinement per calendar year. In contrast, benefits for hospital care include, for example, unlimited days of coverage per calendar year and much higher reimbursement rates for room, board and other services. In this case, besides having been admitted to MRB directly from her home, and not a hospital, Jerrilyn had already used up forty- five of the sixty days of annual benefits at the extended care unit of a Tallahassee hospital. BCBS also has a fee schedule that is used in paying all covered claims. However, the schedule was not introduced into evidence. Estoppel Before he made a final decision as to where to send his daughter, James Aldridge spoke by telephone with several BCBS representatives, including Michelle Sahdala and Rhonda Hall, the unit supervisor and considered its most experienced representative. 1/ Aldridge made these telephone calls because he wanted to positively confirm which facilities would be covered by the plan. During one conversation, Sahdala advised Aldridge that the proposed treatment would not be covered in several facilities named by the National Head Injury Foundation, including New Medico Rehabilitation Center of Florida in Wauchula, Florida and Capital Rehabilitation Hospital in Tallahassee. Aldridge advised BCBS that he might want to place his daughter in MRB, but only if such treatment was covered under his wife's insurance plan. He heard nothing further from BCBS until a week later. Aldridge contacted MRB on March 21, 1988 and advised an MRB representative that he wished to place his daughter in the facility if his wife's insurance covered the treatment at MRB. He also gave MRB the BCBS unit supervisor's name (Rhonda Hall) and telephone number. To verify coverage and benefits, MRB's admission coordinator, Patricia Dear, telephoned Hall on March 22, 1988. Such an inquiry is routinely made by the provider on behalf of the insured and before the patient is admitted to the facility. This is to ascertain if the prospective patient is insured, and if so, to verify the amount of benefits. Dear identified herself and advised Hall that she was requesting benefits information on Jerrilyn Aldridge, an insured. She told Hall that MRB was a skilled nursing facility and not a hospital, the nature of services that would be provided to Jerrilyn and her need to determine whether such services would be covered under the plan before Jerrilyn was accepted as a patient. When asked if she would need further information in hand concerning MRB before determining the amount of benefits, Hall responded affirmatively. Accordingly, Dear sent Hall by overnight mail a letter and brochure describing the facility's services. They were received by BCBS the next morning, or March 23. The letter included information concerning MRB, the fact that it was a skilled nursing facility and not a hospital, the type of services that MRB provided, a summary of the expected charges for treating Jerrilyn (from $600 to $850 per day), the average length of stay of a patient (3 to 9 months), and an offer to answer any additional questions that BCBS might have. When Dear heard nothing further from Hall within the next few days, she made a follow-up telephone call to Hall on March 28 to see if Hall had any questions and to verify benefits coverage. Hall acknowledged receiving the letter of March 22 with attachment. After Dear discussed each of the disciplines and types of services to be provided and their expected cost, including physician services, physical therapy, neuropsychology, central supply, pharmacy, laboratory services and a room and board charge of $351 per day, Hall advised Dear that the only policy exclusions on coverage would be occupational and speech/language therapy. She added that all charges would be subject to medical necessity, and ambulance costs to transport Jerrilyn to the facility would be covered. The two also discussed the fact that there were no time limitations under the policy and that almost $475,000 in lifetime coverage still remained. Hall represented that after the Aldridges satisfied their $1500 deductible on which BCBS paid only 80% of the bills, BCBS would thereafter pay 100% of all medically necessary charges. In making that representation, Hall did not disclose the fact that BCBS has a fee schedule and that all payments were subject to the limitations specified in that schedule. After verifying that Hall had cited all policy limitations, and consistent with her longtime experience in verifying benefits with other insurance carriers, Dear properly assumed that if the policy contained a provision which limited payment to something less than 100% of covered services, Hall would have said so. Dear asked Hall if there was any reason not to admit Jerrilyn and Hall replied "no." Dear also asked Hall if she (Hall) was in a position to verify benefits and Hall represented that she was. Dear then told Hall that Jerrilyn would be presented to the admissions committee the next day and, if clinically appropriate, she would be admitted. Dear ended the conversation by advising Hall that a letter confirming their understanding would be sent after Jerrilyn was admitted. After speaking with Hall, Dear had a clear understanding that coverage and benefits had been approved and, except for occupational and speech/language therapy, BCBS would pay 80% of all medically necessary charges until the Aldridge's $1,500 deductible was met, and then to pay 100% of all remaining medically necessary charges. 2/ After receiving the favorable advice, Dear telephoned Aldridge the same day and told him the results of her conversation with Hall. Within a few moments after speaking with Dear, Aldridge received a telephone call from an unidentified female BCBS representative who informed him that BCBS would pay for his daughter's treatment at MRB. Jerrilyn was accepted as a patient by MRB's admissions committee on March 28, 1988. Both the provider and the insured relied upon Hall's representations in admitting Jerrilyn to the facility. Had Jerrilyn not been covered by the plan, the committee would not have approved her admission. Also, if the Aldridges had known that the treatment at MRB was not covered, they would have sent their daughter to another facility covered by the plan. On April 4, 1988, and pursuant to her last telephone conversation with Hall, Dear sent Hall by overnight mail the following letter: This is to confirm the admission of Jerrilyn Aldridge on March 31, 1988, to the specialized head trauma rehabilitation program at Mediplex Rehab-Bradenton, Florida. The following benefits information has been verified by you and Patricia Dear, R. N., Admissions Coordinator on March 28, 1988. Effective date: 10/1/79 Benefits: After $1,500 - out of pocket/yr- 100% coverage Days available: Unlimited days Monies available: $474,533.79 Exclusions: Occupational Therapy, Speech- Language Therapy Limitations: Treatment subject to "Medical Necessity" If I do not hear from you, I will consider you to be in agreement with the above information. Please place this in the client's file. Thank you for your prompt attention to this matter. (Emphasis supplied) Although BCBS's records reflect that Dear's letter was received, Hall did not advise Dear that there were any problems concerning Jerrilyn's coverage and benefits under the plan or that Dear's understanding of the benefits to be paid was inaccurate or in error. Of some note is the fact that Hall is considered one of the most knowledgeable BCBS representatives on state health plan benefits and recognizes that her statements concerning benefits are relied upon by providers. Even though Hall was specifically advised both orally and in writing that MRB was licensed as a nursing home, and she had access to BCBS's master registry to confirm MRB's licensure status, she failed to discern that a nursing home was not a covered facility for the requested services within the meaning of the plan. Indeed, she later acknowledged by deposition that she knew that "the state does not pay for nursing homes" and that she had made a mistake by failing to properly "investigate" the matter more thoroughly. By failing to convey accurate advice to James Aldridge and MRB and to note that the proposed treatment would not be covered if rendered by a nursing home, Hall failed to use reasonable care and competence in responding to the inquiry. Three months after Jerrilyn's admission, James Aldridge received notice that BCBS had changed its position and now asserted it was not going to pay for Jerrilyn's rehabilitation and treatment at MRB. Proposed agency action confirming this decision was later issued by the Division on October 21, 1988. Miscellaneous All medical services received by Jerrilyn were medically necessary within the meaning of the benefit document. The necessity of Jerrilyn's placement in a rehabilitation facility was established by Dr. James D. Geissinger, her Tallahassee neurologist, who based it upon Jerrilyn's improvement after leaving the Tallahassee hospital and made her a candidate for brain rehabilitation. Doctor Geissinger also noted that, as a result of receiving treatment at MRB, Jerrilyn had made "remarkable" improvement and was able to partially regain her language function, use her left arm and hand, and improve her "activities of daily living." There are expectations that she will be able to walk again within a year. Further, based upon the testimony of an MRB staff physician, the services and treatment received by Jerrilyn at MRB were medically necessary to facilitate her neurologic and functional recovery. Given the nature of her injury and MRB's nursing staffing ratios, the required intensive medical rehabilitation and monitoring of Jerrilyn's medical and neurological condition was comparable to care in a hospital intensive care unit. These matters were not contradicted. On April 1, 1988, the Aldridges executed a standard financial agreement with MRB whereby they agreed to indemnify MRB for all charges which were not paid by BCBS. As is normally done, they also authorized MRB to directly bill BCBS for all charges incurred by Jerrilyn while being treated at the facility. Finally, the Aldridges authorized MRB to make inquiries on their behalf with BCBS to verify insurance coverage and benefits for Jerrilyn. MRB submitted to BCBS all bills for services and treatment given to Jerrilyn during her five or six month stay at the facility. A summary of the dates of service, charges, payments made by BCBS and balance due is contained in petitioners' exhibit 17. In all, there are thirty-eight outstanding bills totaling $227,139.27. The parties have stipulated that the bills in exhibit 17 represent services that were actually performed and supplies that were actually received by the patient. As noted in finding of fact 21, all such supplies and services were medically necessary. For the reasons given in the conclusions of law portion of this recommended order, the doctrine of equitable estoppel applies, and petitioners are entitled to be reimbursed for all unpaid bills filed with BCBS in accordance with the representations of agent Hall. These include room and board charges (at the intensive care room rate), physician services, neuropsychology, physical therapy, central supply, pharmacy and laboratory charges as more fully described in petitioners' exhibit 17. Such reimbursement should be not be subject to the limitations prescribed in the fee schedule.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the amended petition of Etta and James Aldridge be GRANTED, and the Division order Blue Cross and Blue Shield of Florida, Inc. to reimburse petitioners $227,139.27 as reflected in petitioners' exhibit 17. DONE and RECOMMENDED this 7th day of August 1989, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER 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 7th day of August, 1989.
Findings Of Fact Background. Petitioner, George T. Lloyd, Jr., has been employed by the State of Florida, Department of Revenue, for over 14 years, and was, at all times material hereto, a participant in the State of Florida Employees Group Health Self Insurance Plan (Plan), with family coverage. On March 25, 1986, petitioner's son, George T. Lloyd, III (George), then 17 years of age and an eligible dependent under the Plan, was admitted through the emergency room to Broward General Medical Center (Hospital), Fort Lauderdale, Florida. George was placed in the Hospital's Intensive Care Unit, and remained there until his recovery and transfer to the Hospital's psychiatric floor on April 4, 1986. Upon admission, George was comatose and diagnosed as having suffered a severe barbiturate drug overdose. Blood tests performed at the time demonstrated a serum barbiturate level of 145.6 UG (milligrams per milliliter) and a serum Dilantin level of 23.3 UG. At such levels, or even one-half such levels, George would have died of respiratory depression absent medical intervention. On or about August 9, 1986, Blue Cross and Blue Shield of Florida, Inc., the State's administrator of the Plan, notified petitioner that the Hospital's statement for services and supplies rendered during the course of his son's admission of March 25, 1986 to April 4, 1986, totalling $17,402.95, was ineligible for payment based upon the Plan's exclusion of benefits for intentional self-inflicted injuries, to wit: attempted suicide. Pertinent to this case, the Plan provides: VII. EXCLUSIONS The following exclusions shall apply under the Plan: * * * E. Any services and supplies received due to the following circumstances: * * * 2. Resulting from an intentional self- inflicted injury. Over the course of the next two years petitioner's claim for such expenses was reevaluated by the Plan administrator, as well as respondent, Department of Administration (Department). At the conclusion of that review, the Plan administrator concluded that the documentation available to it demonstrated that such expenses were incurred as a consequence of George's attempt to take his own life and were therefore excluded from coverage. By letter of August 19, 1988, the Department notified petitioner that his claim for benefits arising from his son's hospital admission of March 25, 1986 to April 4, 1986, was denied because such expenses resulted from his son's attempt at suicide. Petitioner filed a timely protest of the Department's decision, and the matter was referred to the Division of Administrative Hearings to conduct a formal hearing. An Intentional Self-Inflicted Injury? Petitioner's son has a history of alcohol and drug (marijuana and cocaine) abuse and emotional problems accompanied by periods of depression that predate the incident in question by a number of years. His mother and father (petitioner) were divorced in 1971 when George was approximately three years of age. Thereafter, George resided in Florida with his mother until his fifth birthday, at which time he was sent out-of-state to reside with his father. George resided with his father until he was eleven years old, and then returned to live with his mother in Florida. In the summer of 1984, George was abusing alcohol and drugs, and experiencing difficulties in school. At that time, his mother again sent George to live with his father in the apparent hope that he could assist George in addressing these problems. The petitioner secured group counseling for George in an attempt to assist him. George continued, however, to use alcohol and drugs, and within four months, dropped out of school and ran away. Approximately four or five months later, George reappeared and returned to Fort Lauderdale to live with his mother and stepfather. Following his return, George did little of a constructive nature, and what jobs he was able to secure as a tenth grade dropout were menial in nature and of a minimal wage. Variously he worked as a bag boy, mowed lawns, and washed cars. On March 25, 1986, George was unemployed, and had just concluded an argument with his stepfather concerning his unemployment and failure to follow any constructive pursuit. Depressed at his circumstances, George ingested phenobarbital and Dilantin, drugs that had been prescribed for his stepfather, with the intention of taking his own life. But for the medical intervention previously discussed, George's attempt would have proven successful. At the time he ingested the drugs, George was not under the influence of alcohol or any other drug, and was of sufficient age and maturity to appreciate the consequences of his actions. Both the nature of the drugs he took and the vast quantity he ingested indicate an intentional attempt to take his own life rather than an accidental overdose during "recreational" use. Here, the drugs he took were not "recreational" drugs, they produce no "high," and the dosage, as heretofore noted, was massive. Considering these factors, George's admission that he attempted suicide, and the totality of the circumstances, compels the conclusion that he did consciously attempt to take his own life, and that what depression he suffered did not deprive him of the ability to appreciate the consequences of his actions.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be entered dismissing, with prejudice, the petition for administrative review. DONE and ENTERED this 16th day of May 1989, in Tallahassee, Leon County, Florida. WILLIAM J. KENDRICK 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 16th day of May, 1989.
