The Issue The issue for determination is whether Petitioner was overpaid by the Medicaid program as set forth in Petitioner's Final Agency Audit Report dated June 12, 2006 for the period January 1, 2002 through December 31, 2004.
Findings Of Fact AHCA audited certain of Dr. Negrette's Medicaid claims pertaining to services rendered between January 1, 2002 and December 31, 2004, hereinafter the audit period. Dr. Negrette was an authorized Medicaid provider during the audit period. During the audit period, Dr. Negrette had been issued Medicaid provider number 061422000. No dispute exists that, during the audit period, Dr. Negrette had a valid Medicaid Provider Agreement with AHCA. For services provided during the audit period, Dr. Negrette received in excess $79,523.70 in payments for services to Medicaid recipients. By a preliminary audit report dated August 25, 2005, AHCA notified Dr. Negrette that a preliminary determination was made that he was overpaid by the Medicaid program in the amount of $137,051.25. Subsequently, by a FAR dated June 12, 2006, AHCA notified Dr. Negrette that, after a review of all documentation submitted, it determined that he had been overpaid by the Medicaid program in the amount of $79,523.70, thus, reducing the amount of the overpayment. The FAR further provided how the overpayment was calculated using a sample of the claims submitted during the audit period, including the statistical formula for cluster sampling; and indicated that the statistical formula was generally accepted and that the statistical formula showed an overpayment in the amount of $79,523.70, with a 95 percent probability of correctness. Dr. Negrette agrees that the mathematical computation of the audit is correct.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Agency for Health Care Administration enter a final order finding that Jesus Negrette, M.D., received overpayments from the Medicaid program in the amount of $79,523.70, during the audit period January 1, 2002 through December 31, 2004, and requiring Jesus Negrette, M.D., to repay the amount of overpayment. DONE AND ENTERED this 5th day of February, 2007, in Tallahassee, Leon County, Florida. S ERROL H. POWELL Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 5th day of February, 2007.
The Issue Whether Medicaid overpayments were made to Petitioners, Jeanette E. Norris, M.D., and Sandcastle Pediatrics, and, if so, what is the total amount of these overpayments.
Findings Of Fact The Agency is the state agency charged with administration of the Medicaid program in Florida under Section 409.907, Florida Statutes. Petitioner Norris is a physician who, during the period of January 1, 1997, through October 16, 1999, provided Medicaid services to Medicaid beneficiaries pursuant to a valid Medicaid provider agreement with the Agency under provider number 0543756-00. Petitioner Norris at all times relevant to this matter, provided Medicaid services in an office owned by Petitioner Norris, doing business as Sandcastle Pediatrics, but all Medicaid claims were claimed by and paid to Petitioner. The Agency performed an audit of paid Medicaid claims for services claimed to have been performed by Petitioner Norris during the period January 1, 1997, through October 16, 1999. On March 12, 2201, the Agency issued a Final Agency Audit Report ("Audit Report" or "FAAR"), requesting Petitioner Norris to reimburse the Agency $39,534.32, alleged for overpayments of Medicaid claims submitted by and paid to Petitioner Norris. The determination of overpayment was based upon audit findings that services provided by Petitioner Norris did not meet Medicaid criteria. These criteria included: lack of documentation of services rendered; lack of documentation to support the higher level of service billed; failure to document the required elements for early periodic screening for diagnosis; failure to document performance of treatment services; and billing for two codes when one code incorporated the elements of the other code. During the Audit period, the applicable statutes, laws, rules and policy guidelines (Medicaid rules) in effect required Petitioner Norris to maintain all Medicaid-related records and information that supported any and all Medicaid invoices or claims made by Petitioner Norris during the Audit period. During the Audit period, the Medicaid rules required Petitioner Norris to provide the Agency or the Agency's authorized representatives all the Medicaid-related records and other information that supported all the Medicaid-related invoices or claims for which Petitioner Norris billed Medicaid during the Audit period. Petitioner Norris was required to maintain all medical and Medicaid-related records for a period of five years to satisfy all necessary inquiries by the Agency. During all times relevant to this matter, Petitioner Norris had an affirmative duty to assure that each claim presented to the Agency was true and accurate, and that goods and services were provided in accord with applicable provisions of the Medicaid rules. Medicaid goods and services are deemed excessive or medically unnecessary unless both the medical basis and specific need for them are fully and properly documented in the recipient's medical record. At the request of Ms. Lynne Edwards, the Agency's auditor, the Agency generated a random list of 24 Medicaid recipients (cluster sample) rendered services by Petitioner Norris during the audit period. In addition, the Agency generated work papers of: the total number of recipients to whom Petitioner Norris rendered services during the audit period; the total number of claims by Petitioner Norris with dates of service during the audit period; the total amount paid to Petitioner Norris for all claims with dates of service during the audit period; and worksheets representing each recipient's claims for the audit period. Ms. Edwards obtained the work papers generated by the Agency concerning the random cluster sample, provided 24-hour advance notice to Petitioner Norris of an on-site visit, and performed an on-site visit at the office where Petitioner Norris provided medical services and maintained patient records. After the on-site visit, Ms. Edwards prepared an on-site investigative summary. When Ms. Edwards performed the on-site visit, she spoke with Petitioner Norris. Ms. Edwards presented Petitioner Norris with a questionnaire and printout of the names of the 24 patients in the cluster sample, and asked Petitioner Norris to fill out the questionnaire and mail back to Ms. Edwards the completed questionnaire along with copies of the medical records of the 24 patients in the cluster sample. Ms. Edwards also asked to see medical records of a few of the patients in the cluster sample while she was on-site. Petitioner Norris did not mail a completed questionnaire to Ms. Edwards. Subsequent to the on-site visit, Petitioner Norris provided the Agency with medical records for five of the 24 recipients in the sample. The records were given to Ms. Blanca Notman, the Agency's registered nurse consultant, for policy compliance review. Thereafter, Petitioner Norris submitted medical records for an additional five recipients in the sample. Ms. Edwards forwarded the additional medical records to Ms. Notman for review. After Ms. Notman reviewed the medical records and provided her comments on the claims worksheets, Ms. Notman forwarded the records and worksheets to Dr. Larry Deeb, a pediatrician physician consultant, for a review relating to medical necessity and level of care issues. After review and comments by Dr. Deeb, the records and worksheets were returned to Ms. Notman, who calculated adjustments on the claims worksheets based on the opinions of Dr. Deeb. Ms. Notman returned the medical records and worksheets to Ms. Edwards, along with a Professional Medical Review Report signed by Ms. Notman and Dr. Deeb. Ms. Edwards received the medical records, worksheets, and the Professional Medical Review Report, totaled the overpayments per patient/cluster in the sample, and arrived at a figure of $3,298.45 as the total overpayment for all cluster sample claims. Ms. Edwards submitted the cluster sampling information and the audit review results to another Agency employee for the generation of the extrapolated overpayment calculation, using the Agency's formula. The Agency employee generated and provided to Ms. Edwards the overpayment calculation that represented the findings of the audit of the cluster sampling extrapolated to the total paid claims in the audit period, which was $39,534.32. The Agency prepared its February 6, 2001, Preliminary Agency Audit Report (PAAR) based on the audit review of the medical records provided by Petitioner Norris for the paid claims in the cluster sample. Petitioner Norris provided no documentation for 14 of the 24 patients in the cluster sample, and the audit took this into account. The PAAR was mailed to Petitioner Norris. The PAAR identified all policy violations and determinations found in the audit review. Petitioner Norris closed her medical practice in March 2001. Petitioner Norris joined the employees of a group that provides physicians to hospitals on contract for limited periods of time. This required Petitioner Norris to be away from home and unavailable for large periods of time, which complicated all aspects of this case. The PAAR informed Petitioner Norris that the findings were preliminary and encouraged Petitioner Norris to submit any additional documentation she felt would serve to reduce the overpayment within 30 days. Petitioner Norris did not submit additional documentation to the Agency. Pursuant to Section 409.9131, Florida Statutes (2000 Supp.), the Agency prepared and mailed to Petitioner Norris its March 12, 2001, Final Agency Audit Report (FAAR), asserting a total overpayment determination of $39,534.32 and again identifying all policy violations and determinations found in the audit review. After receipt of the FAAR, Petitioner Norris requested an informal hearing, which the Agency received on April 13, 2001. In her hearing request Petitioner Norris said the 30 days given between the PAAR and FAAR for the submission of additional documentation was not sufficient because she was in the process of closing her medical office and relocating her files and medical records. Petitioner Norris requested an additional 60 days for the submission of additional information, and the letter inferred there were disputed issues of material fact. On April 26, 2001, the Agency's clerk submitted a request to Petitioner Norris that she clarify her hearing request, given what appeared to be disputed issues of material fact. On September 12, 2001, Petitioner Norris sent the Agency a letter that informed the Informal Hearing Officer of dates of availability and acknowledged there were disputed issues of material fact. The matter was subsequently referred to the Division of Administrative Hearings. On March 28, 2002, the Agency took the deposition of Dr. Deeb in lieu of live trial testimony. Prior to the commencement of the deposition, the determination of the Agency as to the paid claims in the cluster sample was reviewed by the parties and stipulations were entered into between the Agency and Petitioner Norris. The stipulations were restated during the deposition. Based on the stipulations prior to and during the deposition of Dr. Deeb, the Agency re-calculated the total overpayment for the paid claims in the cluster sample, extrapolated the sample findings to the population, and determined the adjusted total overpayment of paid Medicaid claims. Prior to the commencement of the final hearing on April 1, 2002, the parties agreed that the information set forth in AHCA Exhibit 10A represented the Agency's final determination as to the claims in the cluster sample determined to be overpayments by the Agency, with the exception of the "No Documentation" overpayment for the date of service of March 3, 1997, which the parties agreed should not be listed on the exhibit because the Agency represented that it would recalculate the extrapolated total overpayment, based upon the final determinations set forth in the Agency Exhibit 10A (subtracting out the "No Documentation" March 3, 1997 listing), and the parties were permitted to supplement AHCA Exhibit 30 with any updated total overpayment determination. The Agency recalculated the extrapolated total overpayment after April 1, 2002, which was determined to be $4,000.48, and supplemented AHCA Exhibit 30 by filing AHCA Exhibit 30A on June 7, 2002. On April 1, 2002, when the final hearing commenced, the parties agreed that the only Medicaid claims overpayment determinations made by the Agency concerning the audit of the claims in the cluster sample that were in dispute were the following: Blood count/fingerstick hemoglobin and hemocrit tests performed as a part of a physician office visits as follows: Recipient/ Patient Date of Service Procedure Billed Reason for Claim Denial Overpayment 13 3/25/97 Blood Count/HE Part of OV $ 2.00 14 2/24/97 Blood Count/HE Part of OV $ 2.00 14 3/10/97 Blood Count/HE Part of OV $ 2.00 16 4/4/98 Blood Count/HE Part of OV $ 2.00 16 5/12/98 Blood Count/HE Part of OV $ 2.00 16 6/18/98 Blood Count/HE Part of OV $ 2.00 Office visit (OV) cannot be billed the same day that an EPSDT is billed, when patient only seen once that day: Recipient/ Patient Date of Service Procedure Billed Reason for Claim Denial Overpayment 22 7/29/97 OV-99202 OV billed same $31.35 same day as EPSDT On April 1, 2002, when the final hearing commenced, the parties agreed that the following claims overpayment determinations made by the Agency concerning the audit of the claims in the cluster sample were not in dispute: Claims were no medical records existed to indicate services were performed: Recipient/ Patient Date of Service Procedure Billed Reason for Claim Denial Overpayment 3 5/12/97 EPSDT No Med. Rec. $64.98 3 5/12/97 blood count No Med. Rec. $ 2.00 3 5/12/97 immunization No Med. Rec. $10.00 3 5/12/97 immunization No Med. Rec. $10.00 3 5/12/97 immunization No Med. Rec. $10.00 3 8/27/97 immunization No Med. Rec. $10.00 3 8/27/97 immunization No Med. Rec. $10.00 3 8/27/97 immunization No Med. Rec. $10.00 3 8/27/97 immunization No Med. Rec. $10.00 7 7/30/97 OV-99213 No Med. Rec. $25.00 22 7/14/98 EPSDT No Med. Rec. $65.33 Office visit (OV) claims, to include Early and Periodic Screening, Diagnosis, and Treatment Services claims (EPSDTs), that lacked all EPSDT components, adjusted to appropriate level of care OV claims. Recipient/ Date of Adjustment Reason for Patient Service Made Adjustment Overpayment 3 8/27/97 EPSDT to 99214 OV Lacked components $27.72 3 8/27/98 99205 OV to 99204 OV Level of Service $38.18 9 10/17/97 99205 OV to 99204 OV Level of Service $17.04 10 4/3/97 99204 OV to 99203 OV Level of Service $21.36 14 3/24/97 99214 OV to 99213 OV Level of Service $12.26 14 4/28/97 99214 OV to 99213 OV Level of Service $12.26 16 1/20/97 99205 OV to 99204 OV Level of Service $17.04 16 3/5/97 99214 OV to 99213 OV Level of Service $12.26 19 3/11/97 99205 OV to 99204 OV Level of Service $17.04 20 4/2/97 99214 OV to 99213 OV Level of Service $12.26 21 2/13/98 99205 OV to 99204 OV Level of Service $16.77 23 8/4/97 99204 OV to 99203 OV Level of Service $21.36 As to the disputed claims concerning the blood count/fingerstick hemoglobin and hemocrit test performed as a part of a physician office visit, Petitioner Norris testified that she did not see the test as a routine part of an office visit, she disagreed with the policy that the test could not be billed separately, and she indicated that usually her nurse would perform the test, which she agreed involved a little prick of blood run through something and took about five minutes. The preponderance of the evidence established that the Agency's determination as to these disputed claims was correct--the Medicaid Handbooks in effect during the audit prohibited Petitioner Norris from separately billing for these tests because they were done during an office visit. The one disputed claim concerning an EPSDT and office visit billed on the same day when the patient was only seen once was for the treatment of the patient's oral infection (thrush). Petitioner Norris admitted that she received reimbursement for office visit procedure Code 99202, in addition to being reimbursed for an EPSDT, even though the patient was seen only once on that day. It was undisputed that prior to the issuance of the Agency's audit report, a peer review was performed by Dr. Larry C. Deeb, a pediatrician in active practice pursuant to Section 409.9131, Florida Statutes (2000 Supp.) Based on the documentation that Petitioner Norris provided to the Agency before the issuance of the Agency audit report, the Agency audit report and related work papers, the adjustment made because of stipulations between the parties after the Agency Audit Report was issued, a preponderance of the evidence establishes there is a Medicaid claims overpayment of $4,000.48 to Petitioner Norris for paid Medicaid claims for the audit period. On April 1, 2002, at the final hearing, Petitioner Norris announced that she disputed the appropriateness of the Agency's statistical formula regarding the extrapolation of the Agency's audit findings concerning the paid claims in the cluster sample to the universe/population of all paid claims during the audit period. The Agency objected on numerous grounds, all of which were overruled. The Agency was permitted to present rebuttal testimony at the conclusion of the presentation of evidence by Petitioner Norris, which the Agency did on June 3, 2002. The statistical formula utilized by the Agency when it made findings based on the cluster sample audit and applied to extrapolate those findings to the population of patient claims paid during the audit period is found on page two of the agency audit report. It was undisputed that during the audit period, Petitioner Norris saw 305 Medicaid patients and had a total of 3,035 Medicaid claims paid. It also was undisputed that a random sample of 24 Medicaid patients who were provided services by Petitioner Norris during the audit period was selected by the Agency for this audit, and all Medicaid paid claims during the audit period for each of the 24 randomly selected patients were reviewed in this audit. Petitioner Norris presented the expert testimony of Dr. Ibrahim Ahmad, regarding the Agency's challenged formula.1 The formula used by the Agency is the one used for infinite populations. In this case, the audited cases were a sample of a finite population. This builds an error into the calculation which can only be corrected by testing the sample against the population to determine if it is reflective of the population. Dr. Ahmad observed that this "proofing" had not been done and in the absence of such a proof of the sample he could not deem the results accurate. The Agency presented the expert testimony of Dr. Mark Johnson on the statistics issue.2 Dr. Johnson explained that there is an adjustment term in the challenged formula--"U" minus "N" under the square root--that adjusts the challenged formula for finite populations.3 In addition to reviewing the Agency's final audit report letter and Agency materials related to the generation of the sample in this case, Dr. Johnson conducted his own analysis of the data, using an Excel spreadsheet program and a statistical package. He was able to reproduce, independently, the same numerical results as the Agency--the estimated overpayment, variance estimates, and the lower 95 percent confidence interval limit. In this case, Dr. Johnson determined the sample was representative of the population because, looking at some of their summary values, they were consistent with the population as a whole. Dr. Johnson indicated that by using the Agency's formula, he arrived at the same calculated values as the Agency. He also investigated assumptions underlying the procedures used in the analysis of this cluster sampling design. Dr. Johnson reviewed the random distribution of the 24 clusters, compared the dollar per claim values in the sample with the figures for the population, and compared the number of claims per patient in the sample with the number of claims per patient in the population. Dr. Johnson's investigation of these properties of the random sample in comparison to the properties of the whole population led him to the conclusion that the sample was representative of the population in this case. The Agency's statistical formula adjusts the "best guess" estimate the total Medicaid overpayment ($7,803.10) downward based on the lower end of the 95 percent confidence interval, causing the overpayment being sought by the Agency to be 4,000.48. The confidence interval is plus or minus the estimate--in this case, the 95 percent confidence interval is $4,000.48 to $11,605.62 (i.e., $7,803.10 plus or minus $3,802.62). Statistically, there is 95 percent confidence that the true overpayment lies within this interval, and the Agency, by seeking the overpayment at the low end of the confidence interval, is giving Petitioner Norris the entire benefit of all of the uncertainty associated with the sampling process. Prior to the commencement of the final hearing in this cause, the Agency had filed its notice of intent to seek investigative costs, expert witness costs, and attorney's fees. At the final hearing, it was determined, as a matter of record, that jurisdiction would be retained for the determination of the Agency's request for such costs and fees. The procedural record of the case reveals that this case was forwarded to DOAH precipitously and before the Petitioner Norris would informally present information which reduced the claim from almost $40,000 to $4,000. At the commencement of the hearing, the parties stipulated to most of the operative facts. The statistical formula was a real issue, and in sum, Petitioner Norris was right; the formula reported was inappropriate. The Agency showed it did not use the reported formula, but one that adjusted for a finite population. Further, the testimony of Petitioner Norris' expert witness was not that the amount of alleged overpayment was wrong, but that the formula was not appropriate. The Agency's expert testified that a factor not stated in the letter was used to adjust the challenged formula for a finite population. Further, the Agency's expert testified he normed the stratified sample against the sampled population, and it did represent that population. This was one of the approaches Dr. Ahmad had suggested to validate the process when using the stated formula. However, Dr. Johnson did this after the challenge, not before. In sum, the burden was on the Agency to prove its case, and by failing to adopt its formula by rule, the Agency placed itself in the position of proving the formula's appropriateness at every hearing. It is so in this case. The request for costs and fees is denied.
Recommendation Based on the foregoing Findings of Facts and Conclusions of Law, it is RECOMMENDED: That the Agency for Health Care Administration issue a final order requiring Petitioner Norris to reimburse the Agency for Medicaid overpayments in the total amount of $4,000.48, plus such interest as may statutorily accrue. For the reasons found above, the Agency's motion for investigative costs, expert witness fees, and attorney's fees is denied. DONE AND ENTERED this 28th day of February, 2003, in Tallahassee, Leon County, Florida. STEPHEN F. DEAN 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 28th day of February, 2003.
Conclusions This cause came before the Agency for Health Care Administration for issuance of a Final Order. 1. On April 8, 2013, the Agency sent a letter to the Petitioner notifying the Petitioner that it owed an overpayment in the amount of $63,378.06 to the Agency based upon an adjustment in the Petitioner’s overpayment rates (Exhibit A). On April 23, 2013, the Petitioner filed a Petition for Formal Hearing and the Agency Clerk referred the Petition for Formal Hearing to the Division of Administrative Hearings for further proceedings. On May 16, 2013, the Administrative Law Judge assigned to the case entered an Order Closing File and Relinquishing Jurisdiction based upon a Joint Motion to Relinquish Jurisdiction filed by the parties. On May 23, 2014, the Agency rescinded the overpayment letter (Exhibit B). The Agency’s rescission of the overpayment letter has rendered this matter moot. Filed August 14, 2014 9:31 AM Division of Administrative Hearings OA / CLERK P 33u Based on the foregoing, IT IS THEREFORE ORDERED AND ADJUDGED THAT: Respondent’s right to a hearing in this matter has been rendered moot and the Agency’s May 11, 2013 overpayment letter is rescinded. The parties shall govern themselves accordingly. DONE AND ORDERED this > day of Avow ot , 2014 in Tallahassee, Leon County, Florida. NOTICE OF RIGHT TO JUDICIAL REVIEW. A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW, WHICH SHALL BE INSTITUTED BY FILING THE ORIGINAL NOTICE OF APPEAL WITH THE AGENCY CLERK OF THE AGENCY FOR HEALTH CARE ADMINISTRATION, AND A COPY ALONG WITH THE FILING FEE PRESCRIBED BY LAW WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED. CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing Final Order has been furnished by U.S. or interoffice mail to the persons named below on this Ut day of ZL Lisas OC, 2014. RICHARD J. SHOOP, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, MS #3 Tallahassee, Florida 32308 9850) 412-3630 COPIES FURNISHED TO: Douglas Lomonico Assistant General Counsel George N. Meros, Jr. GrayRobinson, P.A. Post Office Box 11189 Tallahassee, Florida 32302-3189 Medicaid Program Integrity Office of the Inspector General Shawn McCauley Medicaid Contract Management Division of Medical Quality Assurance Department of Health
The Issue The issue is whether Petitioner overpaid Respondent Medicaid funds, for which Section 409.913(10), Florida Statutes (2002), authorizes Petitioner to seek repayment from Respondent.
Findings Of Fact During 1998, Respondent was an authorized Medicaid provider, pursuant to Medicaid provider number 105425200, and was a party to a valid Medicaid Provider Agreement with Petitioner. Respondent filed claims with Petitioner for payment, under the Medicaid program, for the goods and services that are the subject of the audit described below, and Petitioner paid Respondent for these claims. The audit period in this case is 1998. During 1998, Respondent submitted to Petitioner 36,257 claims for nearly 5.5 million units of over one thousand types of drugs. These claims totaled $3,075,449.88, which Petitioner paid Respondent. On June 2, 1999, Petitioner sent a letter to Respondent informing it of a review of its pharmacy claims for 1998. The letter requests documentation of all purchases of 12 named drugs for 1998 and documentation of all credits for these drugs during the same period. The letter states that acceptable documentation includes itemized wholesaler sales history reports, itemized manufacturer sales history reports, itemized invoices, and credit return receipts. By letter dated June 5, 1999, Respondent provided the requested information. By letter dated June 23, 2000, Petitioner advised Respondent that it had examined the paid Medicaid claims for 1998 and the acquisition documentation that Respondent had provided in June 1999. The letter states: "You have failed to provide adequate documentation to the effect that the available quantity of certain drugs of given strength was as great as the quantity of those drugs billed to and reimbursed by Medicaid.” Thus, Petitioner made a "provisional" determination that it had overpaid Respondent $1,092,205.32. The letter invites Respondent to provide additional information to reduce the overpayment determination. The June 23 letter contains an Overpayment Attachment that lists ten of the twelve drugs for which Petitioner had sought documentation in its earlier letter. For each of these ten drugs, the Overpayment Attachment lists the generic code, number of units for which Medicaid paid, the total amount of Medicaid payments, the total units documented by Respondent to have been available during the relevant period, and the number of units for which Respondent provided no availability documentation. The Overpayment Attachment also calculates the amount of Medicaid payments attributable to the unavailable units and the total overpayment, which is $1,092,205.32. The overpayment calculations described in the preceding paragraph assume that all available units of the audited drugs were sold to Medicaid patients. The effect of this improbable scenario reduces the amount of the overpayment. The overpayment calculations attempt no extrapolation of overpayments on the over 10,000 other drugs for which Respondent received Medicaid payments during 1998. The effect of limiting the overpayment calculation to the ten listed drugs reduces the amount of the overpayment. However, the ten listed drugs are the drugs that generated the most Medicaid payments to Respondent and account for over one-third of the total Medicaid payments during the relevant period. Respondent provided additional information to Petitioner on August 30 and November 3, 2000. However, after examining the information, Petitioner advised Respondent, by letter dated April 8, 2002, that its final determination was that Respondent owed $1,096,489.77 due to its receipt of Medicaid overpayments. The overpayment increased by over $4000 due to the determination that Respondent's records documented 1000 fewer available units of two dosages of Risperdone than Petitioner had previously determined.
Recommendation It is RECOMMENDED that the Agency for Health Care Administration enter a final order directing Respondent to pay Petitioner $1,096,489.77, plus interest, to repay overpayments that it received from the Medicaid program for the sale of drugs in 1998. DONE AND ENTERED this 3rd day of November, 2003, in Tallahassee, Leon County, Florida. S ROBERT E. MEALE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 3rd day of November, 2003. COPIES FURNISHED: Rhonda M. Medows, M.D., Secretary Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building, Suite 3116 Tallahassee, Florida 32308 Valda Clark Christian, General Counsel Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building, Suite 3431 Tallahassee, Florida 32308 Grant P. Dearborn Assistant General Counsel Building 3, Mail Stop 3 2727 Mahan Drive Tallahassee, Florida 32308-5407 Jose M. Herrera Jose M. Herrera, P.A. 1401 Ponce de Leon Boulevard Suite 200 Coral Gables, Florida 33134
The Issue Whether Medicaid overpayments were made to Petitioner by the Agency for Health Care Administration ("AHCA") for services performed during the audit period of December 4, 1996 to December 4, 1998, and, if so, what is the total amount of these overpayments.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: Parties Petitioner is a licensed physician in the State of Florida, having been issued license number 29615. His specialty area of practice is general or family practice. His office is located in Brandon, Florida. AHCA is the agency responsible for administering the Florida Medicaid Program. One of AHCA's duties is to recover Medicaid overpayments from physicians providing care to Medicaid recipients. Section 409.9131, Florida Statutes. The Provider Agreement During the audit period, Petitioner was authorized to provide physician services to eligible Medicaid patients. Petitioner provided such services pursuant to Medicaid Provider Agreements he entered into with AHCA and its predecessor, the Department of Health and Rehabilitative Services, on November 27, 1992, and December 3, 1996. The 1996 Provider Agreement, in effect at the time of the audit, contained the following provisions, among others: Quality of Service. The provider agrees to provide medically necessary services or goods of not less than the scope and quality it provides to the general public. The provider agrees that services or goods billed to the Medicaid program must be medically necessary, of a quality comparable to those furnished by the provider's peers, and within the parameters permitted by the provider's license or certification. The provider further agrees to bill only for the services performed within the specialty or specialties designated in the provider application on file with the Agency. The services or goods must have been actually provided to eligible Medicaid recipients by the provider prior to submitting the claim. Compliance. The provider agrees to comply with all local, state and federal laws, rules, regulations, licensure laws, Medicaid bulletins, manuals, handbooks and Statements of Policy as they may be amended from time to time. * * * 5. Provider Responsibilities. The Medicaid provider shall: * * * (b) Keep and maintain in a systematic and orderly manner all medical and Medicaid related records as the Agency may require and as it determines necessary; make available for state and federal audits for five years, complete and accurate medical, business, and fiscal records that fully justify and disclose the extent of the goods and services rendered and billings made under the Medicaid [sic]. The provider agrees that only records made at the time the goods and services were provided will be admissible in evidence in any proceeding relating to the Medicaid program. * * * (d) Except as otherwise provided by law, the provider agrees to provide immediate access to authorized persons (including but not limited to state and federal employees, auditors and investigators) to all Medicaid- related information, which may be in the form of records, logs, documents, or computer files, and all other information pertaining to services or goods billed to the Medicaid program. This shall include access to all patient records and other provider information if the provider cannot easily separate records for Medicaid patients from other records. * * * (f) Within 90 days of receipt, refund any moneys received in error or in excess of the amount to which the provider is entitled from the Medicaid program. Handbook Provisions Among the "manuals and handbooks" referenced in paragraph 3 of the Provider Agreement in effect during the audit period were the Medicaid Provider Reimbursement Handbook, HFCA- 1500 ("Reimbursement Handbook") and the Physician Coverage and Limitations Handbook ("C&L Handbook"), with their periodic updates. The term "medically necessary" was defined in Appendix D of the Reimbursement Handbook as follows, in relevant part: Medically Necessary or Medical Necessity Means that the medical or allied care, goods, or services furnished or ordered must: (a) Meet the following conditions: Be necessary to protect life, to prevent significant illness or significant disability, or to alleviate severe pain; Be individualized specific, and consistent with symptoms or confirmed diagnosis of the illness or injury under treatment, and not in excess of the patient's needs; Be consistent with generally accepted professional medical standards as determined by the Medicaid program, and not experimental or investigational; Be reflective of the level of service that can be safely furnished, and for which no equally effective and more conservative or less costly treatment is available statewide; and Be furnished in a manner not primarily intended for the convenience of the recipient, the recipient's caretaker, or the provider. . . . Chapter 3 of the C&L Handbook sets forth procedure codes to be used by physicians in claiming reimbursement for services provided to Medicaid recipients. The origin of the procedural and diagnosis codes is as follows, in relevant part: The procedure codes listed in this chapter are Health Care Financing Administration Common Procedure Coding System (HCPCS) Levels 1, 2, and 3. These are based on the Physician's Current Procedural Terminology (CPT) book. The CPT includes HCPCS descriptive terms and numeric identifying codes and modifiers for reporting services and procedures. . . . The CPT book is a systematic listing and coding of procedures and services provided by physicians. Each procedure or service is identified with a five digit code. For purposes of this proceeding, the relevant section of the CPT book is "Evaluation and Management-- Office or Other Outpatient Services," which sets forth the codes used to report evaluation and management services provided in the physician's office or in an outpatient or other ambulatory facility. The CPT book sets forth instructions for selecting the proper level of Evaluation and Management ("E/M") service, as follows in relevant part: Review the Level of E/M Service Descriptors and Examples in the Selected Category or Subcategory The descriptors for the levels of E/M services recognize seven components, six of which are used in defining the levels of E/M services. These components are: history; examination; medical decision making; counseling; coordination of care; nature of presenting problem; and time. The first three of these components (i.e., history, examination, and medical decision making) should be considered the key components in selecting the level of E/M services. . . . Determine the Extent of History Obtained The extent of the history is dependent upon clinical judgment and on the nature of the presenting problem(s). The levels of E/M services recognize four types of history that are defined as follows: Problem focused: chief complaint; brief history of present illness or problem. Expanded problem focused: chief complaint; brief history of present illness; problem pertinent system review. Detailed: chief complaint; extended history of present illness; problem pertinent system review extended to include a review of a limited number of additional systems; pertinent past, family, and/or social history directly related to the patient's problems. Comprehensive: chief complaint; extended history of present illness; review of systems which is directly related to the problem(s) identified in the history of the present illness plus a review of all additional body systems; complete past, family and social history. The comprehensive history obtained as part of the preventive medicine evaluation and management service is not problem-oriented and does not involve a chief complaint or present illness. It does, however, include a comprehensive system review and comprehensive or interval past, family and social history as well as a comprehensive assessment/history of pertinent risk factors. Determine the Extent of Examination Performed The extent of the examination performed is dependent on clinical judgment and on the nature of the presenting problem(s). The levels of E/M services recognize four types of examination that are defined as follows: Problem focused: a limited examination of the affected body area or organ system. Expanded problem focused: a limited examination of the affected body area or organ system and other symptomatic or related organ system(s). Detailed: an extended examination of the affected body area(s) and other symptomatic or related organ system(s). Comprehensive: a general multi-system examination or a complete examination of a single organ system. Note: The comprehensive examination performed as part of the preventive medicine evaluation and management service is multi-system, but its extent is based on age and risk factors identified. For the purposes of these CPT definitions, the following body areas are recognized: Head, including the face Neck Chest, including breasts and axilla Abdomen Genitalia, groin, buttocks Back Each extremity For the purposes of these CPT definitions, the following organ systems are recognized: Eyes Ears, Nose, Mouth and Throat Cardiovascular Respiratory Gastrointestinal Genitourinary Musculoskeletal Skin Neurologic Psychiatric Hematologic/Lymphatic/Immunologic Determine the Complexity of Medical Decision Making Medical decision making refers to the complexity of establishing a diagnosis and/or selecting a management option as measured by: the number of possible diagnoses and/or the number of management options that must be considered; the amount and/or complexity of medical records, diagnostic tests, and/or other information that must be obtained, reviewed and analyzed; and the risk of significant complications, morbidity and/or mortality, as well as comorbidities, associated with the patient's presenting problem(s), the diagnostic procedure(s) and/or the possible management options. Four types of medical decision making are recognized: straightforward; low complexity; moderate complexity; and high complexity. To qualify for a given type of decision making, two of the three elements in Table 2 below must be met or exceeded. Comorbidities/underlying diseases, in and of themselves, are not considered in selecting a level of E/M services unless their presence significantly increases the complexity of the medical decision making. The referenced Table 2, titled "Complexity of Medical Decision Making," sets forth guidelines for the four types of decision-making (straightforward, low complexity, moderate complexity, and high complexity) in terms of the relative number and/or complexity of three elements: number of diagnoses or management options (minimal, limited, multiple, or extensive); amount and/or complexity of data to be reviewed (minimal or none, limited, moderate, or extensive); and risk of complications and/or morbidity or mortality (minimal, low, moderate, or high). The "Office or Other Outpatient Services" section of the CPT book provides the codes for those services in terms of the guidelines set forth above. Five codes of increasing complexity are provided for new patients, and five counterpart codes are provided for established patients: New Patient 99201 Office or other outpatient visit for the evaluation and management of a new patient, which requires these three key components: a problem focused history; a problem focused examination; and straightforward medical decision making. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problems are self- limited or minor. Physicians typically spend 10 minutes face-to-face with the patient and/or family. 99202 Office or other outpatient visit for the evaluation and management of a new patient which requires these three key components: an expanded problem focused history; an expanded problem focused examination; and straightforward medical decision making. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problems are of low to moderate severity. Physicians typically spend 20 minutes face-to-face with the patient and/or family. 99203 Office or other outpatient visit for the evaluation and management of a new patient which requires these three key components: a detailed history; a detailed examination; and medical decision making of low complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problems are of moderate severity. Physicians typically spend 30 minutes face-to-face with the patient and/or family. 99204 Office or other outpatient visit for the evaluation and management of a new patient which requires these three key components: a comprehensive history; a comprehensive examination; and medical decision making of moderate complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problems are of moderate to high severity. Physicians typically spend 45 minutes face-to-face with the patient and/or family. 99205 Office or other outpatient visit for the evaluation and management of a new patient which requires these three key components: a comprehensive history; a comprehensive examination; and medical decision making of high complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problems are of moderate to high severity. Physicians typically spend 60 minutes face-to-face with the patient and/or family. Established Patient 99211 Office or other outpatient visit for the evaluation and management of an established patient that may or may not require the presence of a physician. Usually, the presenting problem(s) are minimal. Typically, 5 minutes are spent performing or supervising these services. 99212 Office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: a problem focused history; a problem focused examination; straightforward medical decision making. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problem(s) are self- limited or minor. Physicians typically spend 10 minutes face-to-face with the patient and/or family. 99213 Office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: an expanded problem focused history; an expanded problem focused examination; medical decision making of low complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problem(s) are of low to moderate severity. Physicians typically spend 15 minutes face-to-face with the patient and/or family. 99214 Office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: a detailed history; a detailed examination; medical decision making of moderate complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problem(s) are of moderate to high severity. Physicians typically spend 25 minutes face-to-face with the patient and/or family. 99215 Office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: a comprehensive history; a comprehensive examination; medical decision making of high complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problem(s) are of moderate to high severity. Physicians typically spend 40 minutes face-to-face with the patient and/or family. Medicaid reimburses physicians according to the level of complexity of the office visit. The more complex the visit (and hence the higher the CPT code number), the greater the level of reimbursement. The Audit During the audit period, Petitioner submitted 2,215 Medicaid claims for services rendered to 382 patients, for which he received Medicaid payments of $134,469.21. In making a determination of overpayment, AHCA is not required to review each and every Medicaid claim submitted by a provider. Section 409.913(19), Florida Statutes, permits the agency to employ "appropriate statistical methods," including "sampling and extension to the population," to make its determination. In this instance, AHCA randomly selected a "cluster sample" of 39 patients from the 382 Medicaid patients to whom Petitioner had provided services during the audit period, and asked Petitioner to produce the medical records he had on file for these 39 patients. AHCA chose the cluster sample of 39 patients according to a statistical formula indicating a 95 percent probability that any overpayment amount would be at least the amount identified. By selecting the 95 percent confidence factor, AHCA attempted to ensure that any potential error in the audit would be resolved in favor of the audited physician. AHCA's statistical expert, Dr. Mark Johnson, validated the methodology used by AHCA. Dr. Johnson not only reviewed AHCA's work, but conducted his own independent analysis that reproduced AHCA's results. Dr. Johnson's testimony as to the reliability of AHCA's methodology is credited. Copies of the medical records were provided to AHCA by Zheila Galvez, the office assistant in charge of Petitioner's billings, on or about March 1, 1999. Ms. Galvez certified that she provided AHCA the complete medical records for the 39 patients, and acknowledged that these records would provide the only information AHCA would use in its audit. Petitioner was later provided an opportunity to supplement the records, but provided nothing further to the agency. At the hearing, counsel for Petitioner objected that AHCA failed to prove that the records it produced in evidence were the complete records as provided to AHCA by Ms. Galvez. The objection was rejected. No evidence was presented to show that AHCA mishandled the documents. Petitioner made no claim that a specific record was missing, and Petitioner was in the best position to know whether the records were complete. Petitioner had submitted a total of 232 claims for services rendered to the 39 patients in the cluster sample during the audit period. Each of these claims was reviewed by AHCA to determine whether it was supported by information contained in the medical records produced by Petitioner in response to AHCA's request. AHCA employee Dr. John Sullenberger, a physician who was not in active practice, performed the initial audit, reviewing all the claims for the 39 patient cluster sample. Dr. Sullenberger's work resulted in the First Audit Report that concluded Petitioner had been overpaid $72,724.89. As noted in the Preliminary Statement above, AHCA withdrew Dr. Sullenberger's audit because newly enacted Section 409.9131, Florida Statutes, mandated "peer review" in agency determinations of overpayment. Dr. Sullenberger did not meet the statutory definition of "peer" because he was not in active practice. See Section 409.9131(2)(c), Florida Statutes. AHCA engaged Dr. Timothy Walker, an active, Board- certified family practice physician who is a faculty member of Tallahassee Memorial Hospital's Family Practice Residency Program, to perform a second audit. Through Dr. Walker's deposition testimony, AHCA established that Dr. Walker's background, work experience and education establish him as an expert in CPT coding, qualified to render an opinion on the propriety of Petitioner's coding and billing practices. Dr. Walker reviewed the records that Petitioner had provided regarding the 39 patients in the cluster sample to determine whether there was documentation to support the Medicaid claims relating to these patients. Dr. Walker's review found that Petitioner exclusively billed the highest levels of CPT coding for outpatient services, i.e., 99205 for new patients and 99215 for established patients. Dr. Walker found that Petitioner failed to document a level of service consistent with these codes. Dr. Walker performed his own review of Petitioner's medical records and noted his conclusions as to the level of CPT coding that could be supported by the record of each patient for each visit to Petitioner's office. Dr. Walker found that all of the visits should have been billed at lower levels, based on the documentation provided by Petitioner. Dr. Walker's testimony is credited as to his review of Petitioner's records. Margarete Johnson, AHCA's registered nursing consultant, performed the calculations by which Dr. Walker's conclusions as to the proper coding were translated into dollar figures. These calculations were a simple function of addition and subtraction, using the relevant Medicaid reimbursement amounts for the various codes. Petitioner had been reimbursed $14,101.44 for the claims related to the 39 patients. Following Dr. Walker's analysis, Ms. Johnson calculated that $8,520.59 of that amount constituted overpayments. Using the generally accepted, appropriate, and valid statistical formula described by Dr. Johnson, AHCA extended this result to the total population of 2,215 Medicaid claims that Petitioner had submitted for services rendered during the audit period, and correctly calculated that Petitioner had been overpaid a total of $77,848.16. Petitioner did not present a case-in-chief. Petitioner's only exhibits were three pages that duplicated documents presented by AHCA, except for the fact that they carried an additional, later agency date stamp not found on those presented by AHCA. Petitioner claimed that these documents proved that AHCA did not produce its entire file on Petitioner during discovery or at the hearing. AHCA's witness Jack Williams explained that the extra, later date stamp on these documents resulted from Petitioner's having re-submitted these pages to AHCA as exhibits to his petition for formal hearing. This explanation was sufficient to allay any suspicion that AHCA's production was less than complete. On the strength of the evidence and testimony presented by AHCA, and in the absence of any evidence or testimony to the contrary, it is found that Petitioner received Medicaid overpayments in the amount of $77,848.16.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that AHCA enter a final order finding that Petitioner received $77,848.16 in Medicaid overpayments for services rendered to his Medicaid patients from December 4, 1996 to December 4, 1998, and requiring him to repay this amount to the agency. DONE AND ENTERED this 24th day of October, 2001, in Tallahassee, Leon County, Florida. LAWRENCE P. STEVENSON 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 24th day of October, 2001. COPIES FURNISHED: Donald W. Weidner, Esquire Matthew D. Weidner, Esquire Weidner, Bowden & Weidner 11265 Alumni Way, Suite 201 Jacksonville, Florida 32246 Anthony L. Conticello, Esquire Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building Three Tallahassee, Florida 32308-5403 Diane Grubbs, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building Three, Suite 3431 Tallahassee, Florida 32308 William Roberts, Acting General Counsel Agency For Health Care Administration Fort Knox Building Three, Suite 3431 Tallahassee, Florida 32308
Findings Of Fact Petitioner, Department of Health and Rehabilitative Services (HRS), is designated as the state agency responsible for the administration of federal and state Medicaid funds, and is authorized by statute to provide payments for medical services. Respondent, Marvin H. Ledbetter, is a doctor of osteopathy who is enrolled as a general practitioner provider in the Medicaid Program. His professional office is in Ormond Beach, Florida where he is engaged in family practice. Under the Program, Ledbetter is assigned a provider number (48220-0) which is used to bill Medicaid for services rendered to Medicaid recipients. During calendar year 1981, which is the only time period in question, Ledbetter received $42,809 in Medicaid reimbursements from HRS, of which $28,062 related to fees for Medicaid hospital patients. The latter category of fees is at issue. In order to qualify for federal matching Medicaid funds HRS must meet certain federally-imposed requirements, including the establishment of a program integrity section designed to insure that all Medicaid services are medically necessary. If they are not, HRS is obliged to seek recoupment of funds paid to the provider. This proceeding involves an attempt by HRS to recoup certain funds paid to Ledbetter for hospital services. After providing medical services to various hospital patients, Ledbetter completed and sent in the necessary forms to obtain payment. As noted earlier, these payments totaled $28,062 during 1981. Upon receipt of the forms, HRS input the information from the forms into a computer data base, along with similar information from other Medicaid providers throughout the State. This information included, among other things, the number of admissions, number of discharges, amount paid for hospital services and length of stay. The retention of such data is necessary so that possible overpayments may be detected by HRS through the statistical analysis of claims submitted by a group of providers of a given type. Because Ledbetter's total discharges exceeded the average of other family physicians throughout the State, the computer generated a report which flagged Ledbetter for further review and examination. An HRS analyst conducted such a review of Ledbetter's records, and found his average hospital length of stay for patients to be acceptable when compared to the average physician in the State. This report was forwarded to the HRS peer review coordinator who randomly selected thirty of Ledbetter's patients from the computer, and obtained their patient charts (numbering sixty-eight). Such a statistical calculation is authorized by Rule 10C-7.6(4)(b), Florida Administrative Code. A medical consultant employed by HRS then reviewed twelve of the sixty-eight charts and recommended the records be sent to a Peer Review Committee (PRC) for its review and recommendation. This committee is authorized by Rule 7C-7.61(4)(c), Florida Administrative Code serves under contract with HRS, and is composed of eight members of the Florida Osteopathic Medical Association. It is their responsibility to review the files of physicians whose Medicaid payments are questioned by HRS's program integrity section. When Ledbetter's records were forwarded to the PRC by HRS, the transmittal letter stated that a "study" of his records had been made, and that said study revealed "overutilization of inpatient hospital services" and "excessive lengths of stay." After a PRC review was conducted in early 1984, the records were returned to HRS with a notation that "mild overutilization" had occurred. According to informal guidelines used by the PRC, this meant that Ledbetter's overutilization fell within the range of 0 percent to 20 percent. HRS accepted these findings but for some reason initially determined that a 40 percent overutilization had occurred, and that Ledbetter was overpaid in 1981 by 40 percent for his hospital services. Finding this amount to be inconsistent with the mild overutilization guidelines, HRS arbitrarily added back two days to each patient's hospital stay, which decreased overutilization to 33.8 percent, or $9,505.06 in overpayments. By proposed agency action issued on May 18, 1984, it billed Ledbetter this amount, thereby precipitating the instant controversy. All of the patients in question were from the lower income category, and most were black. Their home conditions were generally less than desirable, and the ability of the parents to supply good nursing care to ill or sick children was in doubt. At the same time, in 1981 Ledbetter was working an average of 56 hours per week in the emergency room of a local hospital and devoted only minimal time to his family practice. Because of this Ledbetter's number of hospital admissions greatly exceeded the norm when compared to general practitioners who engaged in an office practice. Consequently, he received most of these patients through the emergency room rather than his office and was dealing with patients whose socioeconomic conditions were an important consideration. These factors must be taken into account in analyzing Ledbetter's patient records. HRS does not contend that Ledbetter failed to perform the services for which he was paid--rather, it questions only whether some of the admissions were medically necessary and whether some of the lengths of stay were too long. In this regard, conflicting expert testimony was offered by the parties concerning the amount of overutilization, if any. Expert testimony by two local doctors of osteopathy support a finding that only mild overutilization of admissions and lengths of stay occurred. This is corroborated by HRS's expert (Dr. Smith) and by the testimony of its "live" expert, Dr. Conn, who conceded that lengths of stay were only "a little bit too long." The more persuasive testimony also establishes that while mild overutilization falls within the range of 0 percent to 20 percent, 10 percent is an appropriate median in this proceeding. Using this yardstick, Ledbetter should reimburse HRS for 10 percent for his billings, or $2,806.20.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that respondent repay petitioner $2,086.20 in excess Medicaid payments received for calendar year 1981 claims. DONE and ORDERED this 16th day of May, 1985, in Tallahassee, Florida. DONALD R. ALEXANDER Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 FILED with the Clerk of the Division of Administrative Hearings this 16th day of May, 1985.
The Issue The issue for determination is whether Petitioner received Medicaid overpayments and, if so, the total amount of the overpayments. Petitioner agreed at the onset of the hearing not to contest the findings of the Agency that Petitioner received Medicaid monies to which he was not entitled. Therefore, the issue remaining for determination is: Whether Respondent calculated the overpayment amount of $52,850.82 using a valid statistical formula and a valid sample of recipients and claims during the audit period of March 1, 2000, through March 1, 2002.
Findings Of Fact Based upon observation of the witnesses while testifying, the documentary materials received in evidence, official recognition granted, evidentiary rulings made, and the entire record compiled herein, the following relevant and material facts are established. The Agency is charged with administration of the Medicaid program in Florida pursuant to Sections 409.907 and 409.913, Florida Statutes (2003). Among its administrative duties, the Agency operates a program to oversee the activities of Florida Medicaid providers to ensure that fraudulent and abusive behavior and neglect occur to the minimum extent possible and to recover overpayments and impose sanctions as appropriate. "Overpayment" is statutorily defined to mean "any amount that is not authorized to be paid by the Medicaid Program, whether paid as a result of inaccurate or improper cost reporting, improper claiming, unacceptable practices, fraud, abuse or mistake." § 409.913(1)(d), Fla. Stat. (2000). The FAAR, covering the audit period of March 1, 2000, through March 1, 2002, together with the Agency's work papers, set out a Medicaid overpayment amount of $52,850.82 that the Agency seeks to recoup from Petitioner. Petitioner is a physician enrolled in the Medicaid program under provider number 0580091-00, who operated under his provider number during the audit period of March 1, 2000, through March 1, 2002, under the auspices of a standard Medicaid provider agreement. As a part of the Medicaid provider agreement, the provider agrees to comply with all local, state and federal laws, rules, regulations, licensure laws, Medicaid bulletins, and statements of policy. Petitioner participated in the Medicaid program during the FAAR period of March 1, 2000, through March 1, 2002, and received payment for the services that the Agency now questions and are the subject of the audit. During the above audit period, the applicable statutes, rules, and Medicaid handbooks required Petitioner to retain all medical, fiscal, professional, and business records on all services provided to a Medicaid recipient. Petitioner had to retain these records for at least five years from the date of services. The Florida Medicaid program prepares and furnishes handbooks to all enrolled Medicaid providers, including Petitioner. These handbooks set forth the Medicaid policies with regard to services rendered and billed by providers. Petitioner had a duty to make sure that each claim submitted was true and accurate and was for goods and services that were provided, by an enrolled Medicaid provider, in accordance with the requirements of Medicaid rules, handbooks, and policies, and in accordance with federal and state law. Medicaid providers who do not comply with the Medicaid documentation and record retention policies hereinabove may be subject to administrative sanctions and/or recoupment of Medicaid payments. Medicaid payments for services that lack required documentation and/or appropriate signatures will be recouped. Mr. Hector Tapining (Mr. Tapining) and Phyllis Stiver (Nurse Stiver), registered nurse consultant for Medicaid Program Integrity, conducted an on-site visit to Petitioner's office and requested records. From the files of Petitioner, Mr. Tapining generated a random list of 30 Medicaid recipients (the cluster sample) who had received services by Petitioner during the two- year audit period of March 1, 2000, through March 1, 2002. The Agency thereafter generated worksheets reflecting: (1) the total number of Medicaid recipients during the audit period; (2) total number of claims made by Petitioner, with dates of medical services provided; (3) the total amount of money paid Petitioner during the audit period; and (4) the analyst's worksheets representing his review of each recipient's claim(s) for the audit period. Additional Agency-generated worksheets reflected: (1) the total number of Medicaid recipients during the audit period; (2) the total number of claims of Petitioner, with dates of service; (3) the total amount of money paid to Petitioner during the audit period; and (4) the analyst's worksheets representing his review of each recipient's claim(s) for the audit period. Mr. Tapining provided the worksheets to Nurse Stiver for her review of compliance with Medicaid enrollment and documentation. Mr. Tapining provided the worksheets to E. Rawson Griffin, III, M.D. (Dr. Griffin), the medical records consultant, for his review and evaluation of appropriate billing codes. The formula used by the Agency is a valid statistical formula, the random sample used by the Agency was statistically significant, the cluster sample was random, and the algebraic formula and the statistical formula used by the Agency are valid formulas. Dr. Griffin, after review of 30 patient records, concluded that Petitioner engaged in a general pattern of over coding at the highest level of code (99205) for services rendered that appeared to be rather straight-forward and simple for the medical services rendered at the time of each visit. Over coding is the term employed when supporting documentation for medical billing does not support the billing code chosen and assigned by the provider. In his review, Dr. Griffin saw no middle codes (99213s and/or 99214s) billed by Petitioner. Dr. Griffin opined that it was extraordinary that Petitioner would see and service 30 patients on their first visits, who at that time presented a complaint necessitating a medical necessity level code 99205, the highest level of Medicaid service. Continuing, Dr. Griffin explained that over coding is entering in the patient's billing statement a code higher than the patient's medical complaint and the Patient's recorded medical necessity warranted for the visit or visits (1st, 2nd, 3rd, etc.) on the date those services were provided by Petitioner. In Dr. Griffin's opinion, Medicaid billing codes are to be determined by consideration of the following medical factors: (1) the patient's particular medical complaint and the degree of complexity of that complaint at the time of the initial visit, (2) the type of and the complexity of medical examinations and the tests necessarily required to be administered based upon the type and complexity of the initial complaint, and (3) the resulting interpretations of the tests and the examinations administered for treatment of the complaint. It is only after completion of the above analysis and documentation in the patient's medical records, would a code 22915 billing be appropriate. Dr. Griffin's analysis of the cluster sample of 30 Medicaid records of patients serviced by Petitioner resulted in his down coding Petitioner’s billing as shown below.2 I.D. Number Service Date Code Billed Adjustment B.K. 1 03-29-2000 215 (5) 214 B.K. 1 07-19-2000 214 213 1 08-17-2000 214 213 1 12-11-2000 215 214 1 02-22-2001 215 214 1 05-23-2001 214 213 1 06-24-2001 214 212 J.A.C. 4 No date 215 214 J.R. 5 10-02-2000 215 213 B.F. 6 07-25-2000 215 213 F.H. 8 04-10-2000 215 213 F.H. 8 05-04-2000 214 213 (2 visits) D.C. 9 01-23-2000 215 213 T.M. 10 06-07-2000 215 213 T.M. 10 06-28-2000 214 213 D.W. 13 01-12-2000 215 213 P.L. 14 01-10-2000 214 213 I.H. 15 12-18-2000 215 213 M.V. 17 04-10-2000 215 213 R.R. 21 04-17-2001 214 213 S.K. 25 11-20-2000 212 211 A.H. 26 12-19-2000 215 212 T.P. 27 02-20-2000 215 213 M.R. 28 11-14-2002 215 214 E.C. 29 04-28-2000 214 213 E.C. 07-03-2000 214 213 12-28-2000 214 212 01-02-2000 214 212 01-23-2000 214 212 02-06-2000 214 212 04-03-2000 214 212 (6 visits) R.S. 30 04-16-2001 215 213 Nurse Stiver reviewed the cluster sample of 30 Medicaid records of patients serviced by Petitioner for compliance with Medicaid policy(s) to ensure that services billed are the services for which Medicaid pays and are services that meet all aspects of the Medicaid policy(s) as specified in the Medicaid Handbook. Medicaid policy, regarding provider enrollment, requires (all) providers who services Medicaid patients to be (individually) enrolled in the Medicaid program as providers before providing service and billing Medicaid for those services. The Agency verifies the education, credentials, and criminal background of each enrollee to ensure the safety of Medicaid recipients. The individual provider enrollment is required as a condition precedent for providers to bill Medicaid for services and to be paid by Medicaid for those services. The enrollment requirement includes PAs and ARNPs. Nurse Stiver's review of Petitioner's documents sought to ascertain whether each provider who actually rendered services had executed a voluntary enrollment contract agreement between the Agency and that provider. In these contract agreements, the provider agrees to comply with all laws and rules pertaining to the Medicaid program when furnishing a service or goods to a Medicaid recipient, and the Agency agrees to pay a sum, determined by a fee schedule, payment methodology, or other manner, for the service or goods provided to the Medicaid recipient. The Medicaid Handbook requires separate and/or individual enrollment of each and every entity that provides Medicaid service(s) to Medicaid recipients. The mandatory enrollment includes a provider(s) who makes written entries on and/or signs Medicaid documents. Should the medical service provider and the provider documenting the Medicaid recipient's medical files and the provider billing Medicaid for services rendered be different providers, each provider must be individually enrolled in the Medicaid program. Within a chain of provider entities, the failure of one provider entity to be enrolled entitles the Agency to full recoupment of all Medicaid payments made to the enrolled Provider. Nurse Stiver applied the above analysis to the cluster sample of 30 Medicaid recipients' records recovered from Petitioner's files and to the Agency's worksheets. Nurse Stiver's review and her investigation revealed specific instances in which the paid billing claims evidenced that Petitioner's non-enrolled PAs and/or Petitioner's non-enrolled ARNP either provided the medical services or documented the medical services provided to the Medicaid recipients as shown below: Patient Service Date(s) Services and/or documentation 1. B.K. Serviced 9 times Signature-not enrolled 2. E.J. 08-14-01 Records written and signed by PA not enrolled and (not countersigned by Petitioner) 3. E.T. Serviced 4 times Services provided not entitled to Medicaid payment (unauthorized) J.A. (stipulation) Stipulation3 B.F. 11 visits-serviced Provider not enrolled M.R. 7 visits-serviced Provider not enrolled F.H. 11 visits-serviced Provider not enrolled through 12. Stipulations 13. D.W. 2 visits-serviced Provider not enrolled 14. through 17. Stipulations 18. L.A. 5 visits-serviced Provider not enrolled 19. and 20. Stipulations 21. R.R. 3 visits-serviced Provider not enrolled 22. and 23. Stipulations 24. L.S. 1 visit-serviced Provider not enrolled 25. S.K. 3 visits-serviced Provider not enrolled 26. through 28. Stipulations 29. E.C. 12 visits-serviced Provider not enrolled 30. Stipulation After the review and examination of the claims submitted within the cluster sample, Nurse Stiver concluded the above services billed to the Agency were not performed by Petitioner. She opined that either or both of Petitioner's employees, Justo Lugo and Phillip Nguyen (PAs) and/or Andrea McDonald (ARNP) provided or assisted in providing services. As non-enrolled providers in the Medicaid program, the PAs and the ARNP’s participation in providing services to Medicaid recipients and/or participation in assisting Petitioner in providing medical services and/or participation in Petitioner's billing Medicaid for medical services to Medicaid recipients violated Medicaid policy. Respondent established that the Medicaid program payments for services provided by an individual not enrolled as a provider in the Medicaid program are overpayments of which the Agency is entitled to full recoupment. After the reviews and the analysis by Nurse Stiver and Dr. Griffin, using the Agency's formula for calculating the extrapolated overpayments, the Agency determined overpayment in the amount of $64,453.74 to have occurred. Based upon these findings, the Agency issued a Preliminary Agency Audit Report (PAAR) letter setting out the overpayment amount of $64,453.74 and inviting Petitioner to submit additional documentation. Petitioner's additional documentation submittals were reviewed by the Agency. The post-PAAR review resulted in a reduction of overpayment to $52,850.82 as the total overpayment for all claims considered, and sought to be recovered from Petitioner by the Agency. The Agency's worksheets resulting in the $52,850.82 overpayment included: (1) the medical record review summary; (2) a spreadsheet setting out the names of the recipients, the dates of service, the procedure billed, the amount paid by the Agency, the amount allowed by the Agency, and the resulting overpayment; (3) the overpayment calculation using cluster sampling; (4) the patient worksheets, or claims; and (5) the procedure code summary of the claims in the universe, as defined in Section 409.913, Florida Statutes (2000). The formula used by the Agency is a valid statistical formula, the random sample used by the Agency was statistically significant, the cluster sample was random, and the algebraic formula and the statistical formula used by the Agency are valid formulas. The Agency's data and calculations were reviewed by Ian McKeague, Ph.D. (Dr. McKeague). He reproduced the calculations and concluded that $52,850.82 is the correct overpayment amount made by Medicaid to Petitioner. Petitioner produced neither written authority nor expert testimony contesting the validity of the statistical formula and Dr. McKeague's resulting calculation of overpayment. Nurse Stiver, with over 14 years employment with the Agency, worked with the Medicaid policies and handbooks. She worked with Mr. Tapining on the audit of Petitioner documents. Specifically, she reviewed Petitioner's records for compliance with Medicaid policy, to ensure that the services billed are the services Medicaid paid for and that those services met all aspects of Medicaid policy. Nurse Stiver's investigation and review revealed specific instances in which the paid claims show that the PAs and/or the ARNP, not Petitioner himself, provided the services to Medicaid patients. In each case where the Agency determined Petitioner was not entitled to payment, Nurse Stiver reviewed the medical records and determined that the ARNP or one of the PAs, who were not enrolled in the Medicaid program, actually rendered services to Medicaid recipients. Her determination was based upon her many years of nursing experience that the person rendering the services is the person who documents the services rendered. From her review, it appeared that the ARNP or a PA (not enrolled), not Petitioner, documented the service billed to and paid by Medicaid. Services rendered by an ARNP or a PA who is not enrolled as a provider in the Medicaid program cannot be compensated by the Medicaid program. Petitioner argued that he provided all Medicaid services billed to Medicaid and, on those rare occasions reviewed by Nurse Stiver, his employees (either the ARNP or the PAs), who by happenstance would be present in the treatment room, aided him by merely documenting services he himself rendered to the Medicaid patients. Petitioner presented an alternative argument that on other of those rare occasions reviewed by Nurse Stiver, his employees would be in the room when Petitioner actually provided services to Medicaid patients, and, while he was providing those services, he would simultaneously dictate to his employee who would transcribe his dictations on the Medicaid forms. Petitioner elected not to compel attendance by subpoena of his employees, even though the final hearing was continued to provide Petitioner an opportunity to do so. Petitioner's argument, that the proposed testimony by his employees would have been sufficient to challenge the Agency determination that Petitioner's billing was for services performed by a provider who was not enrolled in the Medicaid program, is without a foundation in fact and rejected. The Medicaid Provider Reimbursement Handbook provides, in part, that "Records must be retained for a period of at least five years from the date of service." The handbook goes on to provide in pertinent part: PAs must meet the general Medicaid provider enrollment that are contained in Chapter 2 of the Medicaid Provider Reimbursement Handbook, HFCA-1500 and Child Health Check- Up 221. In addition, PAs must follow the specific enrollment requirements that are listed in this section. * * * PAs must meet the provider requirements and qualification and their practice must be fully operational before they can be enrolled as Medicaid providers. * * * If a PA is employed by or contracts with a physician who can enroll as a Medicaid provider, the physician must enroll as a group provider and the PA must enroll as a treating provider within the group. * * * Services provided by a PA under the direct supervision of a physician may be billed using the physician's provider number instead of the PA's provider number. Direct physician supervision means the physician: (*) Is on the premises when the services are rendered, and (**) reviews, signs, and dates the medical record. * * * Medical records must state the necessity for and the extent of services provided. The following minimum requirements may vary according to the services rendered: * * * Note: See the service-specific Coverage and Limitations Handbook for record keeping requirements that are specific to a particular service. Providers who are not in compliance with the Medicaid documentation and record retention policies described in this chapter may be subject to administrative sanctions and recoupment of Medicaid Payments. Medicaid payments for services that lack required documentation or appropriate signatures will be recouped. Note: See Chapter 5 in this handbook for information on administrative sanctions and Medicaid payment recoupment. Petitioner, by signing a Medicaid provider agreement, agreed that all submissions for payment of claims for services will constitute a certification that the services were provided in accordance with local, state, and federal laws, as well as rules and regulations applicable to the Medicaid program, including the Medical Provider Handbooks issued by the Agency.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent, Agency for Health Care Administration, enter a final order requiring Petitioner, Mazhar G. Nawaz, M.D., to repay Respondent the principal amount of $52,850.82 plus interest as provided in Section 409.913, Florida Statutes (2002). DONE AND ENTERED this 19th day of February, 2004, in Tallahassee, Leon County, Florida. S 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 19th day of February, 2004.
