Conclusions This cause came before the Agency for Health Care Administration for issuance of a Final Order. 1. On March 26, 2013, the Agency sent a letter to the Petitioner notifying the Petitioner that it owed an overpayment in the amount of $565,279.55 to the Agency based upon an adjustment in the Petitioner’s overpayment rates (Exhibit A). 2. On April 16, 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. 4. On May 13, 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. 5. On May 23, 2014, the Agency rescinded the overpayment letter (Exhibit B). 6. The Agency’s rescission of the overpayment letter has rendered this matter moot. Filed August 14, 2014 9:26 AM Division of Administrative Hearings 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right to a hearing in this matter has been rendered moot and the Agency’s May 11, 2013 overpayment letter is rescinded.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 S day of Novurt , 2014 in Tallahassee, Leon County, Florida. K ELIZABETH DUDEK, SECRETARY AGENCY FOR HEALTH CARE ADMINISTRATION
The Issue The issues presented are whether Petitioner is responsible for reimbursing the Agency for Health Care Administration for an overpayment for Medicaid services and, if so, whether administrative sanctions should be applied.
Findings Of Fact From April 19, 1995, through October 30, 1996, Petitioner was a pharmacy licensed to do business in the State of Florida. From April 15, 1995, through October 30, 1996, Petitioner was a Medicaid provider in good standing, pursuant to a Medicaid contract with the Agency. In 1996 Kathryn Holland, an agency employee, conducted an audit of Petitioner's records, using a method which the Agency calls an aggregate analysis. This analysis focuses on the inventory of a Medicaid provider and analyzes invoices and other documentation to determine if the provider had available during the audit period sufficient quantities of goods or products to support the quantity of goods or products billed to Medicaid. Holland analyzed the Agency's records to ascertain the claims filed by Petitioner and the amounts paid to Petitioner. She compiled a list of those drugs most frequently billed to the Agency's Medicaid program by Petitioner and selected 23 medications. She selected April 1, 1995, through October 30, 1996, as the audit period. She contacted Petitioner and requested records showing Petitioner's purchases of the medications on that list. She also contacted Mason Distributors, Inc., and H. I. Moore, Inc., two of Petitioner's primary suppliers, and requested copies of their invoices for medications purchased by Petitioner between May 1, 1995, and October 28, 1996. She prepared charts of the invoices and other documents received as a result of her requests. She reduced the number of audited drugs to 20 based upon adequate documentation provided to her for three of the listed medications. She prepared a preliminary report, which she sent to Petitioner with a request that Petitioner supply her with any additional records to show that additional supplies of the listed medication were available to Petitioner during the audit period. Petitioner responded to that request by providing additional documentation. Holland did not credit Petitioner with additional supplies based upon the additional documentation because the invoices appeared to be for a different pharmacy or appeared to reflect purchases outside the audit period. Further, the cancelled checks were payable to cash, had no notation as to the purpose of the checks, had a notation reflecting only a "business expense," had a notation for medication not on Holland's list, or reflected purchases outside the audit period. Petitioner was unable to document sufficient inventory during the audit period to justify the amount of medication billed to, and paid for by, the Agency. The Agency overpaid Petitioner in the amount of $12,529.11 for the 20 listed medications during the audit period and is entitled to reimbursement by Petitioner in that amount.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered determining that Petitioner is responsible to repay the Agency in the amount of $12,529.11 by a date certain, imposing an administrative fine in the amount of $2,000, and terminating Petitioner from the Medicaid program for a period of two years. DONE AND ENTERED this 20th day of March, 1998, in Tallahassee, Leon County, Florida. LINDA M. RIGOT Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 20th day of March, 1998. COPIES FURNISHED: Thomas Falkinburg, Esquire Mark Thomas, Esquire Agency for Health Care Administration 2727 Mahan Drive, Suite 3431 Fort Knox Building III Tallahassee, Florida 32308 William M. Furlow, Esquire Katz, Kutter, Haigler, Alderman, Marks, Bryant & Yon, P.A. Highpoint Center, Suite 1200 106 East College Avenue Tallahassee, Florida 32301 Paul J. Martin, General Counsel Agency for Health Care Administration 2727 Mahan Drive, Suite 3431 Fort Knox Building III Tallahassee, Florida 32308 Sam Power, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Suite 3431 Fort Knox Building III Tallahassee, Florida 32308
The Issue The following are the issues presented: Whether Respondent, Leeland ER SVCS Partnership (“Leeland”), is liable to the Agency for Health Care Administration (“AHCA”) for Medicaid overpayments in the amount of $12,377.17, during the audit period of March 1, 2009, through August 31, 2011; Whether Leeland should be required to pay an administrative fine of $2,475.43, pursuant to Florida Administrative Code Rule 59G-9.070(7)(e); and Whether Leeland is liable to AHCA for the agency’s investigative, legal, and expert witness costs pursuant to section 409.913(23)(a), Florida Statutes.
Findings Of Fact Based on the oral and documentary evidence adduced at the final hearing, and the entire record in this proceeding, the following Findings of Fact are made: ACHA is designated as “the single state agency authorized to make payments for medical assistance and related services under Title XIX of the Social Security Act,” i.e., the “Medicaid program.” § 409.902(1), Fla. Stat. Among its duties as the Medicaid agency, AHCA is required to conduct audits of medical providers participating in the Medicaid program, and to “recover overpayments and impose sanctions as appropriate.” § 409.913, Fla. Stat. Section 409.913(1)(e) defines "overpayment" to include "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." The Medicaid provider agreement is a voluntary contract between AHCA and the provider. An enrolled Medicaid provider must comply fully with all state and federal laws pertaining to the Medicaid Program, including the Medicaid provider handbooks incorporated by reference into AHCA’s rules, as well as all federal, state, and local laws pertaining to licensure to receive payment from the Medicaid program. This case involves an AHCA Medicaid audit conducted of Leeland’s paid Medicaid claims as to the dates of service from March 1, 2009, through August 31, 2011, hereinafter referenced as the “audit period.” Leeland was randomly selected for audit and had no prior violations of Medicaid law. Therefore, any sanction imposed on Leeland in this proceeding would constitute a “first offense” under the operative rule discussed in the Conclusions of Law below. During the audit period, Leeland was an enrolled Medicaid provider and had a valid Medicaid provider agreement with AHCA. As an enrolled provider, Leeland was subject to all relevant federal and state statutes, rules, policy guidelines, and Medicaid handbooks incorporated by reference into rule. AHCA issued a PAR, dated June 20, 2013, alleging that Leeland was overpaid $200,349.16 for certain claims that in whole, or in part, were not covered by Medicaid. AHCA later issued a FAR, dated August 16, 2013, alleging that Leeland was overpaid $33,111.52 for certain claims that in whole, or in part, were not covered by Medicaid. The FAR further informed Leeland that AHCA intended to impose a fine of $6,622.30 (20% of the total overpayment) as a sanction for violation of rule 59G-9.070(7)(e) and to impose costs pursuant to section 409.913(23). Leeland received the FAR on August 23, 2013. Leeland timely filed a Petition for Formal Administrative Hearing on September 24, 2013. On October 9, 2013, Leeland tendered payment to AHCA in the amount of $33,111.52, as requested in the FAR, to be held in escrow pending the administrative hearing. The FAR set forth the basis for the overpayment determination as follows: Medicaid policy defines the varying levels of care and expertise required for the evaluation and management procedure codes for office visits. The documentation you provided supports a lower level of office visit than the one for which you billed and received payment. This determination was made by a peer consultant in accordance with Sections 409.913 and 409.9131, F.S. The difference between the amounts you were paid and the correct payment for the appropriate level of service is considered an overpayment. The FAR also stated that the overpayment calculation was based on a statistical formula by which a random sample of the claims submitted by Leeland was selected and extrapolated to the total number of claims in order to arrive at the amount of the total overpayment: A random sample of 63 recipients respecting whom you submitted 134 claims was reviewed. For those claims in the sample, which have dates of service from March 1, 2009, through August 31, 2011, an overpayment of $308.96 or $2.30567164 per claim, was found. Since you were paid for a total (population) of 26,060 claims for that period, the point estimate of the total overpayment is 26,060 x $2.30567164 = $60,085.80. There is a 50 percent probability that the overpayment to you is that amount or more. We used the following statistical formula for cluster sampling to calculate the amount due the Agency:[1/] All of the claims relating to a recipient represent a cluster. The values of overpayment and number of claims for each recipient in the sample are shown on the attachment entitled “Overpayment Calculation Using Cluster Sampling.” From this statistical formula, which is generally accepted for this purpose, we have calculated that the overpayment to you is $33,111.52 with a ninety-five percent (95%) probability that it is that amount or more. After issuance of the FAR, Leeland provided additional information and documentation to MPI, which conducted a peer review of the new material. AHCA subsequently reduced the alleged overpayments in the sample to $171.38. Overpayments were found on claims involving seven of the 63 recipients.2/ AHCA concluded that this overpayment amounted to 2.45 percent of the total payments of $6,987.99 made to Leeland for the claims in the sample. The overpayment amount of $171.38 was extrapolated to the entire population of claims using the formula set forth above. AHCA concluded that the total amount of overpayments to Leeland for all Medicaid recipients in the population was $12,377.17, with a 95 percent confidence level. This reduction in the alleged overpayment led AHCA to make a proportional reduction in the proposed fine, to $2,475.43. Leeland does not challenge the agency’s conclusion that the actual overpayment found in the sample amounted to $171.38. Leeland does challenge the method by which AHCA used that actual overpayment to extrapolate an overall overpayment amount of $12,377.17 for the entire body of Medicaid claims submitted by Leeland during the audit period. AHCA is required by statute to use an “accepted and valid statistical calculation” to determine Medicaid overpayments. ACHA submitted its audit report and work papers into evidence. To support the validity of the cluster sampling method used in this case, AHCA presented the testimony of Dr. Fred Huffer, a professor in the Statistics Department at Florida State University, as well as the AHCA employees who provided the data to which the formula was applied. Robi Olmstead, supervisor of MPI’s Practitioner Care Unit, testified that Leeland was randomly selected for audit. Once the selection was made, Ms. Olmstead assigned the case to an investigator. Her office applied a computerized claim sampling program to select the recipients and claims to be audited. The program pulled all claims for the provider during the audit period. Ms. Olmstead sorted the claims, selecting only those that were fee-for-service, then generated the “seed” and selected the cluster sample. Ms. Olmstead testified that the program tells her how many recipients should be reviewed to make a statistically valid sample. In Leeland’s case, the program stated that 62.6 recipients should be used, so the number was rounded up to 63. Lisa Robinson, the MPI investigator who handled the Leeland audit, testified that the claim sampling program selected the list of 63 recipients to be audited. Ms. Robinson sent a request for medical records to Leeland. Once Leeland submitted the records for the 63 recipients, Ms. Robinson reviewed the records. The claim sampling program generated a worksheet listing each billed claim for each recipient. Ms. Robinson attached the worksheets to the records and prepared them for the nurse reviewer. The nurse reviewer reviewed and organized the records for a peer review by a physician. After the physician reviewed and determined any disallowed amounts, the records were returned to Ms. Robinson, who entered the disallowed amounts into the claim sampling program to determine the amount of the overpayment. Ms. Olmstead testified that she has no statistical expertise and that she relied on Dr. Huffer to review and validate the results obtained by the claim sampling program. Ms. Robinson likewise claimed no statistical expertise or any real knowledge of how the claim sampling program works. Ms. Robinson simply enters data into the program and accepts the results it generates. Dr. Huffer, who has consulted with MPI since 2004, testified that when he received the overpayment calculation results, he first checked the calculations. Next, he constructed hypothetical populations based on MPI’s sample to test the confidence level of 95 percent asserted in the FAR. Dr. Huffer explained that a confidence level is a probability attached to the correctness of some statement or procedure. The 95 percent confidence level in this case means that if MPI runs its audit procedure repeatedly, the number that it states as the overpayment from a sample of the population will be less than the “true” overpayment in the overall recipient population 95 percent of the time. The “true” overpayment value remains unknown, but the simulations performed by Dr. Huffer lead to a “reasonably confident” conclusion that the assessed overpayment is an underestimate of that “true” value. Dr. Huffer stated that the simplest type of sampling scheme is a simple random sample, in which units are selected at random and audited. He noted that sometimes the units are naturally grouped into clusters, and much sampling effort can be saved by sampling the clusters of units rather than the units individually. In this case, AHCA was interested in auditing a population of claims, but the claims were naturally grouped by recipients. Therefore, to conserve resources, AHCA used single- stage cluster sampling, with each selected resident constituting a cluster of claims to be audited. Dr. Huffer noted the practical advantages of this method: [T]here’s a lot less effort in accessing the records of a smaller number of recipients, and also there’s a lot less effort in making decisions about medical necessity for a small number of recipients versus, say, a large number of recipients. So there’s a lot of savings in sampling effort by doing a cluster sampling based upon clusters, which are the recipients. Dr. Huffer testified that a sample size of 63 was valid, independent of the size of the population from which the sample was taken. He stated that “it is a well-known fact in statistics that it is the sample size which primarily governs the accuracy of the result, not the population size.” He noted, for instance, that a sample size of 35 could be validly used for a population of one million. Dr. Huffer explained that he constructed a hypothetical population that is “like a large scaled-up version of the sample.” He “cloned” every recipient and every claim for all recipients about 208 times to make a hypothetical population of approximately 13,000 recipients. From this population, he sampled 63 recipients at random and performed the same calculation that AHCA did on its sample. He performed the calculation procedure on two million samples of 63 recipients drawn from his hypothetical population. Dr. Huffer’s two million simulations yielded an empirical confidence level of 97.7 percent, meaning that “we’re even more confident in this case that the number we announce as the overpayment is less than the true overpayment . . . in the population.” Dr. Huffer explained the extrapolation of the sample to the population. By taking the $171.38 of total overpayments found in the 134 claims for the population of 63 residents in the sample, MPI derived an average overpayment per sample claim of $1.27.3/ There were 26,060 claims in the entire population. Multiplying the total number of claims by the $1.27 average overpayment yielded a “point estimate” of the total overpayment of a little more than $33,000. Dr. Huffer stated that while the overpayments in the population may be “in the neighborhood” of the point estimate, there is never an expectation that the point estimate will be exactly correct. Every random sample of recipients would yield a somewhat different total. Therefore, a standard error of the overpayment was introduced as an estimate of how far wrong the point estimate might be. The standard error in this case was $12,547.82. The true overpayment could be plus or minus some multiple of the standard error. Dr. Huffer testified that to reach the lower bound of the 95 percent confidence level, MPI subtracted about one and one-half times the standard error from the point estimate to arrive at an overpayment value of $12,377.17. Dr. Huffer concluded that there was “strong evidence” that the true overpayments exceeded $12,377.17, because that figure was an “intentional underestimate.” Counsel for Leeland questioned Dr. Huffer about the validity of the statistically derived overpayment, given that the actual overpayment drawn from the sample, $171.38, was so small compared to the total Medicaid payments for those recipients. Dr. Huffer testified that the 95 percent confidence rate is “totally unrelated” to the magnitude of the actual overpayments. To counter Dr. Huffer’s testimony on the irrelevancy of the size of the actual overpayment to the validity of the sampling method, counsel for Leeland presented a federal Medicare statute, 42 U.S.C. § 1395ddd(f)(3), which provides as follows, in relevant part: Limitation on use of extrapolation A medicare contractor may not use extrapolation to determine overpayment amounts to be recovered by recoupment, offset, or otherwise unless the Secretary determines that— there is a sustained or high level of payment error; or documented educational intervention has failed to correct the payment error . . . . Dr. Huffer responded that the federal statute does not imply that extrapolation is not allowed for statistical reasons. He believed that the reason for the Medicare law’s disallowance of extrapolation in smaller cases could be simply to forgive errors below a certain threshold. Counsel for Leeland offered another example, an “Open Letter to Health Care Providers” issued by the Office of Inspector General of the U.S. Department of Health and Human Services in 2001. The letter sets forth new claims review procedures, including a statement that if the net financial error rate in a discovery sample is below five percent, the provider is not required to perform any further audit work and only the actual identified overpayments must be refunded. Dr. Huffer pointed out that the letter, like the statute, does not question the statistical validity of extrapolation. “They do not give any statistical reason for saying that it would be wrong to proceed in this case. As far as I know, they’re just saying if you [have] a small error rate, we’ll forgive it.” Dr. Huffer agreed that there was not a “sustained or high level of payment error” in this case, but observed that this case was not being decided under the federal Medicare statute. Dr. Huffer opined that the sampling method used in this case was reasonable and comported with generally accepted statistical methods. His opinions and explanation were credible, were unrebutted, and are accepted. Leeland's attempt to undermine Dr. Huffer’s opinions through cross-examination was ineffective and lacked the support of contradictory expert testimony regarding generally accepted statistical methods. AHCA seeks to recover its investigative, legal, and expert witness costs pursuant to section 409.913(23)(a). AHCA has established its right to recover these costs. At the outset of the final hearing, the parties agreed that if AHCA prevailed in the case-in-chief, and was found to be entitled to costs, then this tribunal would retain jurisdiction for the limited purpose of allowing AHCA to document its costs in the manner provided by section 409.913(23)(b).
Recommendation Based on the foregoing, it is, therefore, RECOMMENDED that the Agency for Health Care Administration enter a final order requiring Leeland ER SVCS Partnership to repay the sum of $12,377.17 for overpayments on claims that did not comply with the requirements of Medicaid laws, rules, and provider handbooks, including interest. Jurisdiction is retained to determine the amount of costs and attorney's fees, if the parties are unable to agree to the amount, and either party may file a request for a hearing within 30 days after entry of the final order to determine the appropriate amounts. DONE AND ENTERED this 11th day of April, 2016, in Tallahassee, Leon County, Florida. S LAWRENCE P. STEVENSON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 11th day of April, 2016.
The Issue Whether Petitioner, Agency for Health Care Administration (AHCA or Agency), is entitled to a recoupment of Medicaid funds paid to the Respondent, Florida Hospital Orlando (Respondent), that were overpayments for medical services rendered to undocumented aliens during the audit period.
Findings Of Fact The Parties AHCA is the state agency charged with the responsibility of monitoring and administering the Medicaid program within the State of Florida. AHCA conducts audits, as provided by law, to assure compliance with all pertinent state and federal regulations. As required, AHCA issues audit reports to document a Medicaid provider’s performance during a specified audit period. At all times material to this case, Respondent was a Medicaid provider who received payments for medical services rendered to the Medicaid patients identified in this Order. Respondent complied with all regulations and procedures to secure payment for medical services rendered to patients, including approval from AHCA’s fiscal agent. The fiscal agent is referred to, in this record, as KePro. It is undisputed that the medical services were provided to the patients. The Audit The audit period in this case is July 1, 2005, through December 31, 2005. It is undisputed that Respondent provided all of the medical services rendered to the patients described in this matter during that time frame. The payments for such care, however, were not completed until a time in 2008 that was less than three years from the issuance of the FAR. At all times material to this case, Medicaid providers were required to maintain financial records for a period not less than five years. All of the medical treatments were approved by KePro. All of the patients identified in the instant FAR were or are undocumented aliens. Medicaid allows a provider to render medical care to undocumented aliens only as provided by law. In this regard, only emergency medical care is covered for undocumented aliens. Medical care that may be entirely necessary or appropriate, but is not rendered as “emergency care” may not be reimbursed. The FAR seeks recoupment of Medicaid monies paid to Respondent for non-emergency care rendered to undocumented aliens. The Patients Patient 1 presented to Respondent’s emergency room on October 31, 2005, with a history of nausea, vomiting, and an elevated creatinine indicating renal failure. Patient 1 was 73 years old and reported abdominal pain through an interpreter. Additionally, Patient 1, who was on a cardiac medication, had an elevated potassium level and cardiac arrhythmia. Given Patient 1’s age and condition, it was medically necessary to admit the patient for cardiac monitoring and evaluation. At the time of admission, Patient 1 required emergency care. Renal failure and cardiac arrhythmia may indicate a life-threatening condition. Respondent’s treatment of Patient 1 continued and discovered an enlarged heart, chronic lung disease, along with renal concerns. Under Respondent’s care Patient 1 returned to a regular cardiac rhythm, was rehydrated, and potassium and creatinine levels returned to a normal range. On November 2, 2005, Patient 1’s vital signs were stabilized. Thereafter, Patient 1 remained in the hospital and was monitored until release on November 4, 2005. Patient 2 presented to Respondent’s emergency room on October 31, 2005. Outpatient services rendered for this patient had failed to alleviate an infection in the patient’s right hand. At 88 years of age, if left untreated Patient 2 was in danger of losing a finger if the swelling and infection were not contained. Given Patient 2’s history of diabetes, the concern for spread of the infection to other portions of the hand resulted in admission to the hospital for emergency care. Patient 2 was put on an IV-treatment and the finger was surgically addressed to drain and remove infectious areas. By November 2, 2005, the finger was clinically “looking good” and the antibiotic treatment had started to address the infection. Emergency care was no longer necessary to address the patient’s medical needs. Patient 2 remained in the hospital until November 4, 2005. Patient 3 was another 88-year-old who presented to Respondent with an extended history of diarrhea and abdominal pain. On December 25, 2005, Patient 3 was admitted with an elevated white blood cell count, a low potassium level, and dehydration. Given the patient’s age and circumstance, it was medically necessary to rehydrate Patient 3 with IV-fluids and to monitor renal sufficiency due to rising creatinine levels. After several gastro/intestinal examinations, antibiotic treatment, and elimination of the diarrhea, the patient was released on January 5, 2006. Patient 3 required emergency medical care for the entire stay due to the patient’s age and hydration issues. As the patient did not accept oral medication, the IV-treatments assured continued hydration, potassium improvement, and the administration of antibiotics. Without such care, Patient 3’s health would have deteriorated to a potentially life-threatening situation. On the patient’s day of discharge, Patient 3 was considered medically stable. Patient 4 was a nonverbal autistic child who was brought to Respondent on August 31, 2005. This patient was removed from an inappropriate home setting and taken into custody by the state to protect the child’s safety and health. When he presented at the emergency room, this patient did not have a medical condition that warranted admission to the hospital. The child was taken to the hospital for medical evaluation but only a “social” emergency existed. That is to say, the child had nowhere to go. Although, technically, in the state’s custody, a foster home appropriate for Patient 4’s challenges had to be found before placement could be made. It is undisputed that the child could not be discharged to the street; however, no emergency medical care was necessary for this patient. Patient 5 was admitted to Respondent on October 25, 2005, as a transfer patient from Glades Hospital. This patient was evacuated from Glades due to a hurricane. Patient 5 spoke only Creole, was 80 years of age, and had suffered a recent heart attack. Glades Hospital stabilized the patient sufficiently for transfer into Respondent’s cardiac care unit. Although Respondent sought to perform a cardiac catheterization for this patient in order to evaluate the patient’s heart function, Patient 5’s family refused consent. Respondent continued care for this patient with monitoring and medication, and Patient 5 remained stable. Respondent sought a family member to whom discharge could be made. A son was not located until days later. Patient 5 did not require emergency care while Respondent waited for a discharge disposition. Patient 6 was 67 years old with a long history of a disease called ulcerative colitis. When this patient presented at Respondent’s emergency room, September 3, 2005, there was gastro/intestinal bleeding, pain, and what was presumed to be diverticulitis. Given his inflammatory bowel disease, bleeding, and pain, Patient 6 had a medical emergency and had to be quickly treated to resolve the “acute flare” of this case. Respondent treated Patient 6 with IV-fluids, antibiotics, and medication to decrease inflammation. Patient 6 responded well to the treatment and, by September 4, 2005, was not in an emergent condition. Patient 6 remained in the hospital until September 5, 2005. Recoupment of Medicaid Overpayments Based upon the foregoing findings, and the persuasive weight of the evidence presented by the parties, it is determined: As to Patient 1, emergency medical care was not required for this patient subsequent to November 2, 2005; As to Patient 2, emergency medical care was not required for this patient subsequent to November 2, 2005; As to Patient 3, prior to discharge on January 5, 2006, the date upon which this patient was stabilized, all of Patient 3’s care was rendered as emergency medical care; As to Patient 4, none of this patient’s care was required as emergency medical care; As to Patient 5, emergency medical care was not required for this patient subsequent to October 27, 2005; and As to Patient 6, emergency medical care was not required for this patient subsequent to September 4, 2005. Since Respondent received Medicaid payments for the above-described patients after the patient no longer required emergency care, Petitioner is entitled to a recoupment of Medicaid payments.
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 Respondent was overpaid in the amount of $24,055.51 (the full audit amount less the claim for Patient 3) together with costs for a total of $26,203.15. DONE AND ENTERED this 3rd day of May, 2012, in Tallahassee, Leon County, Florida. S J. D. PARRISH Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 3rd day of May, 2012. COPIES FURNISHED: John D. Buchanan, Jr., Esquire Henry, Buchanan, Hudson, Suber, and Carter, P.A. Post Office Drawer 14079 2508 Barrington Circle (32308) Tallahassee, Florida 32317-4079 Andrew T. Sheeran, Esquire Agency for Health Care Administration 2727 Mahan Drive, Suite 3431 Fort Knox Building 3, Mail Station 3 Tallahassee, Florida 32308 Richard Shoop, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 Elizabeth Dudek, Secretary Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 1 Tallahassee, Florida 32308 William H. Roberts, Acting General Counsel Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308
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
Conclusions This cause came before the Agency for Health Care Administration for issuance of a Final Order. 1. On May 23, 2013, the Agency sent a letter to the Petitioner notifying the Petitioner that it owed an overpayment in the amount of $50,992.15 to the Agency based upon an adjustment in the Petitioner's overpayment rates (Exhibit A). On June 17, 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 July 1, 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 9:30 AM Division of Administrative Hearings a tenE’ AGENCY CLERK P 3 3u 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 g day of Avnus® ; 2014 in Tallahassee, Leon County, Florida. AGENCY FOR HEALTH CARE ADMINISTRATION
The Issue The issue for determination is whether Respondent must repay Petitioner an amount of up to $144,471.25 in alleged Medicaid overpayments, for paid claims covering the period from January 1, 2010, to December 31, 2012.
Findings Of Fact AHCA is the agency responsible for administering Medicaid in the state of Florida. VMC was, at all relevant times, an enrolled Medicaid provider authorized to receive reimbursement for covered goods and services rendered to Medicaid beneficiaries. Exercising its statutory authority to oversee the integrity of Medicaid, the Agency conducted a review of VMC's medical records to verify that claims paid by Medicaid during the period from January 1, 2010, to December 31, 2012 (the "Audit Period"), had not exceeded authorized amounts. During the Audit Period, VMC had submitted claims for 9,783 discrete billable goods or services ("BGOSs") rendered to 1,313 patients (or recipients), on which Medicaid had paid a total of $459,572.82. Rather than examine the records of all 1,313 recipients served, the Agency selected a sample of 35 patients, whose records were reviewed first by a nurse consultant, and then by a physician "peer reviewer." VMC had submitted claims for 302 BGOSs during the Audit Period in connection with the 35 patients in the sample population. Medicaid had paid a total of $13,909.94 on these claims. The Agency's reviewers determined that, for various reasons, VMC had received a total of $6,901.64 in reimbursement of claims in the sample for services not covered by Medicaid, in whole or in part. Having discovered this alleged "empirical overpayment" of $6,901.64, the Agency employed a statistical formula for cluster sampling——for purposes of which a "cluster" comprises all claims relating to an individual patient in the sample population——to ascertain the alleged "probable total overpayment" that VMC had received from Medicaid for the 9,783 BGOSs presented in the totality of claims submitted during the Audit Period.1/ The statistical analysis revealed a probable total overpayment of $179,660.46, with a 95 percent probability that the actual overpayment is equal to or greater than such amount. (As discussed below, VMC disputes the cluster sampling methodology that AHCA used in determining the probable total overpayment based on the empirical overpayment associated with the sample population.) Shortly before the final hearing, based on documents which VMC belatedly produced, the Agency revised its preliminary adjudication of certain claims associated with four of the patients in the sample population, resulting in a reduction of the alleged empirical overpayment to $5,976.00. AHCA's statistical formula extended this figure to VMC's entire patient population for the Audit Period, calculating a total probable overpayment of $144,471.25. VMC does not dispute every one of AHCA's preliminary adjudications. To begin, for five recipients (Patient Nos. 15, 17, 19, 21, and 28) AHCA found no overpayments. Thus, none of the claims presented for BGOSs furnished to these patients is in dispute. In many additional instances, VMC agrees not only with the Agency's determination that Medicaid paid too much for a particular BGOS (or "encounter" as VMC refers to an individual good or service for which a claim was submitted), but also with the amount of the alleged overpayment. As a result of these admissions, none of the claims presented for BGOSs furnished to Patient Nos. 2, 9, 11, 13, 16, 25, and 34 is in dispute. In some instances, VMC suggests that the empirical overpayment for a particular BGOS should be more than the amount that AHCA has alleged. The sum of these suggested additional overpayments ("SAOs") is $303.19. Owing to VMC's inculpatory suggestions of insufficiently aggressive recoupment, it is undisputed that all of the overpayments AHCA has alleged in connection with the claims submitted for the treatment of Patient Nos. 3, 10, 23, 24, 26, and 32 are, in fact, overpayments. In sum, out of 35 patients in the sample population, only 17 involve one or more disputed encounters, where the existence of an overpayment must be decided. As for the 18 patients listed in the two preceding paragraphs, all of the overpayments alleged in those clusters are accepted as such based on the evidence presented, including the Agency's work papers and VMC's admissions, leaving only the question of what to do about the SAOs. All told, VMC admits having received an empirical overpayment of at least $2,488.50. VMC contends, however, that it was underpaid a total of $27.76 in connection with two BGOSs provided to Patient No. 18. VMC asserts that this alleged underpayment offsets the admitted overpayment by an equal amount, so that, in VMC's eyes, the net admitted empirical overpayment (taking into account the SAOs totaling $303.19) is $2,763.93.2/ VMC disputes the Agency's determinations regarding 55 specific BGOSs. Of these, AHCA found in 48 instances that the particular service which VMC had provided was not medically necessary. These 48 determinations relate to ten separate diagnostic procedures. AHCA further found a single instance of incomplete documentation in connection with one of those same ten procedures, bringing to 49 the total number of disputed adjudications pertaining to ten different procedures. Four disputed Agency determinations relate to what are known as "evaluation and management services" ("E/M services") provided (a) in the doctor's office or other outpatient setting to new or established patients or (b) to patients in hospitals. E/M services are billed to Medicaid using codes that reflect the intensity level of service provided. The codes are called "CPT codes"——"CPT" being short for Current Procedural Terminology®, a registered trademark of the American Medical Association, which developed and keeps up-to-date this widely used system for reporting medical procedures and services. Medicaid reimburses providers for E/M services pursuant to fee schedules that specify the amount payable for each level of service according to the CPT codes. It is the provider's responsibility, in presenting a claim to Medicaid for payment, to determine the appropriate CPT code for the service provided. Medicaid generally pays claims upon receipt, without second-guessing the provider's judgment regarding the level of care. When the Agency conducts an investigation to determine possible overpayment to a provider, however, one thing it might review is whether the provider's claims were properly "coded"—— that is, whether the CPT codes on the bills accurately reflected the level of service provided to the patients, as documented in the medical records. If the Agency determines that the level of service provided was lower than that claimed, then it will "downcode" the claim to the proper level and seek to recoup from the provider, as an overpayment, the difference between what Medicaid paid on the claim as originally coded and what it would have paid on the claim as downcoded. In this case, four of the 55 disputed claim determinations involve a downcode. Collectively, these four disputed items total $13.55. In two instances involving Patient No. 18, VMC agrees with AHCA's determination that there was no overpayment for the BGOS in question, but it asserts that Medicaid paid too little on the claims, which could have been billed under higher paying codes. As mentioned above, these alleged underpayments ("UPs") total $27.76. The table below summarizes the disputed overpayments, sorted by disputed overpayment ("OP") amount per patient (largest to smallest): Pt. # Disputed OP (w/SAOs) Admitted OP (w/SAOs) Alleged OP Number of Disputed BGOSs Number of SAOs Amount of SAOs Number of alleged UPs Amount of Claimed UP 22 545.00 401.83 946.83 8 7 523.79 57.75 581.54 5 35 466.10 112.83 578.93 7 6 376.65 91.89 468.54 5 1 15.98 31 194.88 73.21 268.09 3 1 14.85 27 157.73 479.12 636.85 2 8 157.73 12.85 170.58 2 5 153.54 16.61 170.15 4 18 150.97 280.56 431.53 5 2 -27.76 4 106.29 38.85 145.14 1 33 105.44 182.80 288.24 2 14 89.94 120.37 210.31 1 1 20.60 20 84.39 264.56 348.95 6 11 168.79 12 51.09 0 51.09 1 30 47.53 0 47.53 1 29 35.46 50.99 86.45 1 1 15.98 1 4.77 0 4.77 1 Subtotal 3,251.30 2,184.22 5,435.52 55 15 236.20 2 -27.76 Pt. # Disputed OP (w/SAOs) Admitted OP (w/SAOs) Alleged OP Number of Disputed BGOSs Number of SAOs Amount of SAOs Number of alleged UPs Amount of Claimed UP 2 0 23.32 23.32 9 0 23.32 23.32 11 0 37.58 37.58 13 0 32.57 32.57 16 0 33.10 33.10 25 0 46.85 46.85 34 0 36.14 36.14 Subtotal 0 232.88 232.88 32 (1.50) 37.64 36.14 1 1.50 26 (2.00) 203.04 201.04 1 2.00 3 (15.56) 37.64 22.08 1 15.56 24 (15.97) 34.13 18.16 1 15.97 10 (15.98) 31.07 15.09 1 15.98 23 (15.98) 31.07 15.09 1 15.98 Subtotal (66.99) 374.59 307.60 6 66.99 15 n/a 0 17 n/a 0 19 n/a 0 21 n/a 0 28 n/a 0 TOTAL 3,184.31 2,791.69 5,976.00 55 21 303.19 2 -27.76 Before addressing the disputed BGOSs, two subjects will be resolved, to further refine the issues. First, the undersigned has decided that each of the 21 separate SAOs should be treated as no more or less than corroboration that the alleged overpayment is correct——not used as a basis for increasing the amount AHCA alleges is due. Thus, for example, if AHCA alleged that the overpayment for a particular encounter was $36.14 and VMC offered evidence that the overpayment for that encounter was actually $37.64, the undersigned will find that the undisputed overpayment is $36.14. As a result, nothing else needs to be decided in regard to any of the claims presented for BGOSs furnished to Patient Nos. 3, 10, 23, 24, 26, and 32. Second, the undersigned rejects VMC's assertion that the empirical overpayment should be reduced by a total of $27.76 because it provided BGOSs to Patient No. 18 for which it did not bill Medicaid enough.3/ This reduces the number of disputed encounters from 55 to 53. The table below summarizes the disputed overpayments after taking account of the foregoing determinations, sorted by disputed overpayment amount per patient (largest to smallest): Pt. # Disputed OP Admitted OP Alleged OP Number of Disputed BGOSs 22 545.00 401.83 946.83 8 7 523.79 57.75 581.54 5 35 466.10 112.83 578.93 7 6 392.63 75.91 468.54 5 20 253.18 95.77 348.95 6 31 209.73 58.36 268.09 3 27 157.73 479.12 636.85 2 8 157.73 12.85 170.58 2 5 153.54 16.61 170.15 4 18 150.97 280.56 431.53 3 14 110.54 99.77 210.31 1 4 106.29 38.85 145.14 1 33 105.44 182.80 288.24 2 29 51.44 35.01 86.45 1 12 51.09 0 51.09 1 30 47.53 0 47.53 1 1 4.77 0 4.77 1 Subtotal 3,487.50 1,948.02 5,435.52 53 2 0 23.32 23.32 0 3 0 22.08 22.08 0 9 0 23.32 23.32 0 10 0 15.09 15.09 0 11 0 37.58 37.58 0 13 0 32.57 32.57 0 16 0 33.10 33.10 0 23 0 15.09 15.09 0 24 0 18.16 18.16 0 25 0 46.85 46.85 0 Pt. # Disputed OP Admitted OP Alleged OP Number of Disputed BGOSs 26 0 201.04 201.04 0 32 0 36.14 36.14 0 34 0 36.14 36.14 0 Subtotal 0 540.48 540.48 0 15 n/a 0 n/a 17 n/a 0 n/a 19 n/a 0 n/a 21 n/a 0 n/a 28 n/a 0 n/a TOTAL 3,487.50 2,488.50 5,976.00 53 Each side presented opinion testimony regarding the compensability of the disputed BGOSs under Medicaid. On the question of medical necessity, AHCA's medical expert was Ronald Machado, M.D., upon whose testimony, together with the notations of the Agency's nurse reviewer appearing in the audit worksheets, AHCA relies in support of its overpayment allegations. VMC's medical expert was Dr. Michael Sterns, whose written opinions were presented through the report of L. Lamar Blount, a health-care consultant who, at VMC's request, conducted a shadow audit of the claims AHCA had examined. To assist in his review, Mr. Blount engaged the services of a coding specialist (Rae Freeman) and a statistician (Frank Collins) in addition to Dr. Sterns. The undersigned has considered all of the opinion testimony presented, together with the medical records and other evidence received. Each of the findings that follow is based upon a preponderance of the evidence which the undersigned deemed credible and persuasive, and each constitutes a rejection of other evidence to the extent of any conflict between the finding and such evidence. In determining whether a particular claim should be allowed or disallowed, the undersigned considered, as necessary, the relevant provisions of the pertinent statutes, rules, and Medicaid handbooks, the operative terms of which are identified in the Conclusions of Law following these Findings of Fact. The undersigned's determinations as to each of the disputed BGOSs are set forth below in summary fashion, using abbreviations where possible. This is consistent with the manner in which the parties' respective experts addressed the individual claims. The brevity of the discrete rulings is not a reflection of the attention that has been given each item, all of which were carefully and thoroughly examined. For analytical efficiency, the undersigned sorted the disputed claims by procedure, from highest to lowest overpayment subtotal. The claim-specific findings are presented below in that fashion. The descriptions of the procedures are adapted from the American Medical Association's Physician's Current Procedural Terminology® Handbook. Each disputed claim is identified by Patient Number – Encounter Number ("Pt. # - Enc. #"), using the recipient numbers assigned by AHCA. The Encounter Numbers correspond to the identically designated numbers in column C of Appendix D to Respondent's Exhibit JJ, which in turn match the claim numbers appearing in AHCA's "Listing of All Claims in Sample by recip name" worksheet, a 73- page document attached to the FAR, Petitioner's Exhibit 4. Ultrasound, retroperitoneal (e.g., renal, aorta, nodes), real time with image documentation, complete – CPT 76770. A complete ultrasound examination of the retroperitoneum consists of real time scans of the kidneys, abdominal aorta, common iliac artery origins, and inferior vena cava, including any demonstrated retroperitoneal abnormality. If the clinical history suggests urinary tract pathology, a complete evaluation of the kidneys and urinary bladder also comprises a complete retroperitoneal ultrasound. The undersigned makes the following findings of fact regarding VMC's claims for this BGOS: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 76770 5-15 NMN 52.00 MN established by diagnosis of microscopic hematuria. 0.00 6-2 NMN 53.44 78-year-old man presents with hematuria and nocturia plus a renal cyst. MN established to rule out BPH (enlarged prostate). 0.00 8-1 NMN 51.44 Patient reports pain and history of kidney stones during review of genitourinary ("GU") system plus low back pain. MN established to rule out recurrence of renal calculi. 0.00 18-12 NMN 51.44 Patient complains of flank pain, giving reason to rule out renal calculi. No evidence that a kidney, ureter, and bladder ("KUB") X-ray would have been cheaper, nor proof that renal US was outside generally accepted standards of medical practice. MN shown. 0.00 18-27 NMN 52.00 Patient continues to complain of unexplained right flank/abdominal pain. Diagnoses of hydronephrosis and renal colic. MN established. 0.00 Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 76770 20-8 NMN 51.44 Patient presents with complaint of dark- colored urine. Dysuria and hematuria noted. MN shown. 0.00 22-2 NMN 53.44 1/11/10 Patient experiencing unexplained hematuria. US revealed two kidney cysts. MN shown. 0.00 22-11 NMN 53.44 7/12/10 US to follow up on kidneys cysts. No documentation of symptoms or need for such close monitoring. NMN 53.44 22-16 NMN 53.44 11/10/10 Repeat US of kidney to monitor cysts. Excess of need for a benign condition. NMN 53.44 22-21 NMN 51.44 11/29/11 Patient presents with hematuria and history of kidney cysts. MN established in light of symptom and need to reexamine the cysts for possible enlargement. 0.00 27-17 NMN 53.44 No reason given for repeat study of kidney after apparently asymptomatic cyst found via renal US on 6/30/10. NMN 53.44 29-4 NMN 51.44 Contemporaneous urinalysis ("UA") found occult blood and renal epithelial cells, warranting study to rule out kidney disease. MN shown. 0.00 31-12 NMN 51.44 Patient in his early 70s complains of dysuria and abdominal pain. US not preceded by review of UA results and prostate exam. NMN 51.44 31-20 NMN 52.00 Progress notes do not provide grounds for this study. NMN 52.00 33-6 NMN 53.44 Patient presents with persistent hematuria notwithstanding treatment of UTI. MN shown. 0.00 33-11 NMN 52.00 Patient reports dysuria and renal colic. MN for US established by new symptoms. 0.00 35-2 NMN 51.44 Progress note reports patient complaint of nephrolithiasis plus hematuria per UA results. MN established. 0.00 35-26 NMN 50.00 Patient presents with undiagnosed hematuria plus absence of menstruation. MN shown. 0.00 Subtotal 938.72 263.76 Echocardiography, transthoracic, real-time with image documentation, complete, with spectral Doppler echocardiography, and with color flow Doppler echocardiography – CPT 93306. A standard echocardiogram is also known as a transthoracic echocardiogram ("TTE"). The echocardiography transducer (or probe) is placed on the chest wall of the patient, and images are taken through the chest wall. This noninvasive procedure allows for the assessment of the overall health of the patient's heart valves and degree of heart muscle contraction, which is an indicator of the ejection fraction. The undersigned makes the following findings of fact regarding VMC's claims for this BGOS: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 93306 4-3 NMN 106.29 Patient presents with heart murmur and/or rub. TTE ordered to assess left ventricular ejection fraction ("LVEF") and rule out valvular disease of heart, which was confirmed by finding of mitral valve disease. MN shown. 0.00 7-4 NMN 104.29 Patient presents with history of palpitations and chest pain and has a heart murmur on examination. MN for TTE shown. 0.00 8-2 NO DOC 106.29 Patient presents with murmur, palpitation, and chest pain, as documented in progress note. TTE ordered to rule out valvular disease. Echocardiogram Report is in the file. Documentation shown. 0.00 14-4 NMN 110.54 Teenage patient presents with recent history of seizure and loss of consciousness. TTE ordered to rule out mitral valve prolapse. MN shown. 0.00 27-14 NMN 104.29 85-year-old man reports dizziness and has murmur on examination. TTE ordered to rule out worsening of valvular disease and assess LVEF. MN shown. 0.00 31-10 NMN 106.29 Patient presents with heart murmur. TTE one year earlier found numerous abnormalities. TTE ordered to assess function and rule out worsening of condition. MN shown. 0.00 35-23 NMN 104.29 Patient presents with complaint of migraine. No cardiac symptoms. History of mitral valve prolapse indicated. NMN 104.29 Subtotal 742.28 104.29 Duplex scan of lower extremity arteries or arterial bypass grafts, complete bilateral study – CPT 93925. Duplex Doppler ultrasound uses standard ultrasound methods to produce an image of a blood vessel and the surrounding organs. A computer converts the Doppler sounds into a graph that provides information about the speed and direction of blood flow through the blood vessel being evaluated. The undersigned makes the following findings of fact regarding VMC's claims for this BGOS: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 93925 6-9 NMN 156.21 Patient presents with limb swelling, symptomatic varicose veins, chronic venous insufficiency, and peripheral edema. MN shown. 0.00 7-7 NMN 156.21 Patient presents with limb pain or swelling and symptomatic varicose veins. Diagnoses of peripheral artery disease and venous insufficiency. MN shown. 0.00 35-9 NMN 156.21 Patient presents with lower extremity swelling, chronic venous insufficiency, and peripheral edema; heart murmur noted on exam. MN shown. 0.00 Subtotal 468.63 0.00 Noninvasive physiologic studies of upper or lower extremity arteries, multiple levels or with provocative functional maneuvers, complete bilateral study (e.g., segmental blood pressure measurements, segmental Doppler waveform analysis, segmental volume plethysmography, segmental transcutaneous oxygen tension measurements, measurements with postural provocative tests, measurements with reactive hyperemia) – CPT 93923. The undersigned makes the following findings of fact regarding VMC's claims for this BGOS: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 93923 6-10 NMN 91.02 Patient presents with limb swelling, symptomatic varicose veins, chronic venous insufficiency, and peripheral edema. This study excessive in combination with lower extremity study of same date. NMN 91.02 7-8 NMN 91.02 Patient presents with limb pain or swelling and symptomatic varicose veins. Diagnoses of peripheral artery disease and venous insufficiency. This study excessive in combination with lower extremity study of same date. NMN 91.02 22-6 NMN 91.02 Patient presents with muscle pain in the left leg but progress note lacks support for this study to check blood flow. NMN 91.02 35-10 NMN 91.02 Patient presents with lower extremity swelling, chronic venous insufficiency, and peripheral edema; heart murmur noted on exam. This study excessive in combination with lower extremity study of same date. NMN 91.02 Subtotal 364.08 364.08 Duplex scan of extremity veins including responses to compression and other maneuvers, complete bilateral study – CPT 93970/93971. The CPT code 93970 is described as a "complete bilateral study." The CPT code 93971 states: "unilateral or limited study." The undersigned makes the following findings of fact regarding VMC's claims for this BGOS: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 93970/93971 7-5 NMN 122.74 Patient presents with limb pain or swelling and symptomatic varicose veins. Diagnoses of peripheral artery disease and venous insufficiency. This study excessive in combination with lower extremity study of same date. NMN 122.74 22-7 NMN 122.74 Patient presents with muscle pain in the left leg but progress note lacks support for this study. NMN 122.74 22-27 (93971) NMN 70.20 Insufficient support in the progress notes for this study. NMN 70.20 Subtotal 315.68 315.68 Ultrasound, pelvic (nonobstetric), real time with image documentation; complete – CPT 76856. Pelvic ultrasound codes are used for both female and male anatomy. Elements of a complete female pelvic examination include a description and measurement of the uterus and adnexal structures, endometrium, bladder, and of any pelvic pathology (e.g., ovarian cysts, uterine leiomyomata, free pelvic fluid). Elements of a complete male pelvic examination include the evaluation and measurement (when applicable) of the urinary bladder, prostate and seminal vesicles to the extent they are visualized transabdominally, and any pelvic pathology (e.g., bladder tumor, enlarged prostate, free pelvic fluid, pelvic abscess). The undersigned makes the following findings of fact regarding VMC's claims for this BGOS: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 76856 5-5 NMN 51.09 Patient is reported to have pelvic pain on 5/3/11 and referral to GYN is made. Pelvic pain again noted on 8/24/11. Study performed on 9/13/11 found uterine fibroid. MN established. 0.00 5-16 NMN 47.68 Excessive in light of retroperitoneal US of same date. NMN 47.68 6-4 NMN 51.09 78-year-old man presents with hematuria and nocturia plus a renal cyst. Excessive in light of retroperitoneal US of same date. NMN 51.09 12-2 NMN 51.09 Patient presents complaining of irregular periods, pelvic pain (non- radiating, pressure-like), nausea, and urinary changes for several weeks. MN for study shown. 0.00 20-9 NMN 51.09 Patient presents with complaint of dark-colored urine. Dysuria and hematuria noted. Excessive in light of retroperitoneal US of same date. NMN 51.09 Subtotal 252.04 149.86 Ultrasound, soft tissues of the head and neck (e.g., thyroid, parathyroid, parotid), real time with image documentation – CPT 76536. The undersigned makes the following findings of fact regarding VMC's claims for this BGOS: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 76536 7-3 NMN 49.53 Patient presents complaining of neck mass and swollen glands. MN shown. 0.00 18-10 NMN 47.53 Patient presents with complaints of memory loss and dizziness. Progress notes reflect presence of carotid bruits and possible neck swelling. Insufficient documentation of grounds for this study. NMN 47.53 20-4 NMN 49.53 Patient presents with swollen glands and physical exam reveals thyroid abnormality. MN established. 0.00 22-30 NMN 49.28 Insufficient documentation of grounds for the study; no mention of history or findings relating to thyroid issue. NMN 49.28 30-1 NMN 47.53 Patient presents with swollen glands and neck lumps, complaining of dizziness, and physical exam reveals thyroid abnormality. MN established. 0.00 Subtotal 243.40 96.81 Ultrasound, abdominal, real time with image documentation, limited (e.g., single organ, quadrant, follow-up) – CPT 76705. The undersigned makes the following findings of fact regarding VMC's claims for this BGOS: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 76705 6-3 NMN 40.87 78-year-old man presents with hematuria and nocturia plus a renal cyst. Excessive in light of retroperitoneal US of same date. NMN 40.87 20-7 NMN 42.87 Patient presents with complaint of dark-colored urine. Dysuria and hematuria noted. Excessive in light of retroperitoneal US of same date. NMN 42.87 Subtotal 83.74 83.74 Ultrasound, abdominal, real time with image documentation; complete – CPT 76700. A complete ultrasound examination of the abdomen consists of scans of the liver, gallbladder, common bile duct, pancreas, spleen, kidneys and the upper abdominal aorta and inferior vena cava including any demonstrated abdominal abnormality. The undersigned makes the following findings of fact regarding VMC's claims for this BGOS: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 76700 20-17 NMN 55.01 Patient presents with abdominal pain and abdominal mass related to an incisional hernia. This study was in excess of need in light of CT scan ordered same date. NMN 55.01 Subtotal 55.01 55.01 Electrocardiogram, routine EKG with at least 12 leads; with interpretation and report – CPT 93000. The undersigned makes the following findings of fact regarding VMC's claims for this BGOS: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 93000 35-25 NMN 10.37 Patient presents with heart murmur. TTE one year earlier found numerous abnormalities. This EKG excessive in combination with TTE ordered on same date to assess function and rule out worsening of condition. NMN 10.37 Subtotal 10.37 10.37 Office or other outpatient visit (established patient) – CPT 99213. This level of care is located in the middle of the coding spectrum for office visits with established patients. Usually the presenting problems are of low to moderate severity. The documentation for this encounter requires two out of three of the following: (1) expanded problem focused history; (2) expanded problem focused examination; and (3) low complexity medical decision making. Physicians typically spend 15 minutes face-to-face with the patient in connection with a 99213-level appointment. In contrast, 99212 is a CPT code for office or other outpatient visit for the evaluation and management of an established patient with a problem focused history and examination, and straightforward medical decision making. The documentation for this encounter requires two out of three of the following: problem focused history; (2) problem focused examination; and (3) straightforward medical decision making. Physicians typically spend ten minutes face-to-face with the patient in connection with a 99212-level appointment. The undersigned makes the following findings of fact regarding VMC's claims for office or other outpatient visits: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 99213 1-1 LL - 99212 4.77 Problem focused history and exam plus straightforward medical decision making. 99212 4.77 5-6 LL - 99212 2.77 Problem focused history and exam plus straightforward medical decision making. 99212 2.77 35-19 LL - 99212 2.77 Problem focused history and exam plus straightforward medical decision making. 99212 2.77 Subtotal 10.31 10.31 Initial Hospital Care – CPT 99223. The undersigned makes the following findings of fact regarding VMC's claim for a patient being admitted to the hospital: Pt.# - Enc.# AHCA Determination Disputed Overpayment ALJ Determination of Overpayment – CPT 99223 20-20 LL - 99221 3.24 Evidence supports 99221, not 99223 as billed. Applicable Fee Schedule (eff. Jan. 1, 2011) provides for payment of 49.12, not 52.36 as VMC urges. 3.24 Subtotal 3.24 3.24 The table below summarizes the foregoing findings, showing the per-patient overpayments (including both the adjudicated and admitted subtotals per patient, listed in separate columns), sorted from lowest to highest numbered patient: Pt. # ALJ Disallow Admitted OP Finding of OP 1 4.77 0 4.77 2 Undisputed 23.32 23.32 3 Undisputed 22.08 22.08 4 0 38.85 38.85 5 50.45 16.61 67.06 6 182.98 75.91 258.89 7 213.76 57.75 271.51 8 0 12.85 12.85 9 Undisputed 23.32 23.32 10 Undisputed 15.09 15.09 11 Undisputed 37.58 37.58 12 0 0 0 13 Undisputed 32.57 32.57 14 0 99.77 99.77 15 n/a n/a n/a 16 Undisputed 33.10 33.10 17 n/a n/a n/a 18 47.53 280.56 328.09 19 n/a n/a n/a 20 152.21 95.77 247.98 21 n/a n/a n/a 22 440.12 401.83 841.95 23 Undisputed 15.09 15.09 24 Undisputed 18.16 18.16 25 Undisputed 46.85 46.85 26 Undisputed 201.04 201.04 27 53.44 479.12 532.56 Pt. # ALJ Disallow Admitted OP Finding of OP 28 n/a n/a n/a 29 0 35.01 35.01 30 0 0 0 31 103.44 58.36 161.80 32 Undisputed 36.14 36.14 33 0 182.80 182.80 34 Undisputed 36.14 36.14 35 208.45 112.83 321.28 TOTAL 1,457.15 2,488.50 3,945.65 Thus, the undersigned finds that the entire empirical overpayment for the Audit Period is $3,945.65, an amount that comprises $1,457.15 as the sum of all adjudicated overpayments and $2,488.50 as the sum of all admitted overpayments. To be clear, each of the numbers in the "ALJ Disallow" column above is based on findings supported by a preponderance of the evidence. The figure of $1,457.15 is not supported, however, by clear and convincing evidence. The grand total of $3,945.65 is, more likely than not, the correct empirical overpayment for the claims in the sample population. The figure of $3,945.65 is not supported, however, by clear and convincing evidence. As mentioned above, AHCA determines the probable total overpayment based upon the empirical overpayment observed in the sample population, using a statistical formula for cluster sampling to extend the empirical data to the provider's entire patient population. AHCA is statutorily authorized to use generally accepted statistical methods in making a determination of overpayment to a provider, and to offer the results of such statistical methods as proof of overpayment.4/ The formula that AHCA uses is reproduced below: VMC contends that the statistical formula upon which AHCA has relied produces less accurate results than other methods that could have been used, and that AHCA made mistakes when it employed the formula in this case. The latter argument is rejected as contrary to the persuasive evidence, which shows that AHCA correctly performed the calculations required to implement the statistical formula for cluster sampling. As for the efficacy of the Agency's formula, the undersigned accepts that there are other statistical methodologies that AHCA could use, and that it would be possible to obtain a more accurate result using other methods. The Agency does not dispute this. But, according to AHCA's expert witness, Dr. Fred Huffer, a statistician whose testimony the undersigned credits with qualifications as explained below, increasing the accuracy of the statistical methodology most likely would result in a higher probable total overpayment because there is supposed to be only a five percent chance that the figure AHCA's formula produces is too high. The undersigned determines that the statistical formula for cluster sampling that AHCA uses is a generally accepted, valid, and reliable method of extending the overpayment observed in a sample population to the entire relevant population. That said, there is less to the relative persuasiveness of the number produced by the Agency's formula than meets the eye. The confidence level of 95 percent assumes that every numerical value going in to the formula is absolutely (not just probably) true. For some of the values, i.e., F, Bi, U, and N, this degree of confidence (namely, 100 percent) is justified. For others, i.e., Ai, it clearly is not. The total overpayment in the sample cluster is not an objective truth, such as the number of clusters in the random sample, or a mathematical constant such as pi. Rather, each alleged overpaid claim in the sample reflects a judgment by AHCA (or more precisely its medical reviewers) founded on findings of historical fact, legal conclusions, and determinations of ultimate fact. Indeed, each figure contributing to the total empirical overpayment numerically represents an ultimate factual determination based upon the application (and interpretation when necessary) of Medicaid rules to a limited body of evidence——mostly medical records——of past events. Of none (or very few) of those figures can it be said with 100 percent certainty that the number is absolutely (not just probably) true. No one involved in the decision making process is omniscient or infallible. As here, the provider may dispute some or all of AHCA's preliminary adjudications of the claims behind the total alleged overpayment in the sample cluster and demand a hearing, at which each (disputed) individual overpayment in the sample cluster must be proved by a preponderance of the evidence. The standard of proof being what it is, the Agency does not need to prove each of the disputed overpayments to an absolute certainty. To recoup an overpayment, it is sufficient for AHCA to show with a 51 percent probability that the amount alleged to have been overpaid for a given claim is, in fact, the amount overpaid. In the paragraphs above, the undersigned has set forth his findings regarding the disputed claims. Each individual finding of an overpayment reflects the undersigned's determination that the disallowed amount is, more likely than not, the correct adjudication of the disputed claim. There is, in the undersigned's estimation, approximately a 60 percent probability that the sum of all adjudicated overpayments ($1,457.15) is the correct figure, which satisfies the preponderance of evidence standard. In contrast, the undersigned estimates that there is approximately an 80 percent probability that the sum of all admitted overpayments ($2,488.50) is the correct figure, meaning that this portion of the empirical overpayment was established by clear and convincing evidence. This discussion of the undersigned's relative confidence in the overpayment findings made in this Recommended Order is meant to demonstrate that using the figure $3,945.65 as the value Ai in the Agency's formula for cluster sampling, while consistent with the standard of proof for an action to recoup an overpayment, nevertheless injects uncertainty into the equation, which logically must reduce the confidence level in the formula's outcome from 95 percent to something less than that.5/ Based on the instant record, the undersigned cannot quantify the probable accuracy of the formula's output, as applied to the facts found here. The bottom line is that although the undersigned finds AHCA's statistical formula to be a sufficiently reliable method of calculating, to the degree of certainty required under the preponderance of evidence standard of proof, the total probable overpayment to VMC, the formula's output (in this instance) does not satisfy the stricter clear and convincing standard.6/
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that AHCA: Recalculate the probable total overpayment using the statistical formula for cluster sampling to extend the empirical overpayment of $3,945.65 in the sample population to the entire population during the Audit Period. Make a preliminary determination of the amount of costs that may be recovered from VMC, taking into consideration the financial resources, earning ability, and needs of VMC to the extent VMC demonstrates such factors. Remand the matter to DOAH for an evidentiary hearing on recovery of costs if necessary. Enter a final order directing VMC to repay the Agency the total probable overpayment as recalculated using the findings herein, plus statutory interest, for paid claims covering the period from January 1, 2010, to December 31, 2012; imposing an administrative fine against VMC in the amount of $5,000; and taxing recoverable costs, full payment of these monies to be due within 30 days after the rendition of the final order and payable on the Agency's instructions. DONE AND ENTERED this 10th day of April, 2015, in Tallahassee, Leon County, Florida. S JOHN G. VAN LANINGHAM 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 10th day of April, 2015
The Issue The issue is whether Petitioner received a Medicaid overpayment in the amount of $11,077.65 for claims filed between April 15, 1998, and December 31, 2001.
Findings Of Fact Respondent is the agency responsible for administering the Florida Medicaid Program. One of its duties is to recover Medicaid overpayments from physicians providing care to Medicaid recipients. Petitioner is a licensed chiropractor in the State of Florida. His Medicaid provider number is No. 3801578-00. At all times relevant here, Petitioner provided services to Medicaid patients pursuant to a valid Medicaid provider agreement. Therefore, Respondent was subject to all statutes, rules, and policy guidelines that govern Medicaid providers. Specifically, Petitioner was required to follow the guidelines set forth in the Medicaid Coverage and Limitation Handbook and the Medicaid Reimbursement Handbook. Additionally, Petitioner was required to maintain all "Medicaid-related records" that supported his Medicaid invoices and claims and to furnish those records to Respondent upon request. In 1997 and until April 1998, Petitioner's advertisement in the yellow pages of the Panama City, Florida, telephone book invited the public to make an appointment for a "free spinal exam," which specifically included two X-rays, if medically necessary. The advertisement indicated that Petitioner's office accepted patients with major medical insurance, workers' compensation insurance, and Medicare and Medicaid coverage. The advertisement did not specifically exclude Medicare and Medicaid patients, but specifically stated that the free spinal exam did not include further examination, treatment, or workers' compensation and personal injury cases. However, Petitioner's subsequent advertisements in the telephone book specifically included Medicaid as a type of case that Petitioner excluded from the offer of free services. The original and subsequent advertisements further stated as follows: Our office policy: The patient and any other person responsible for payment has the right to cancel payment, or be reimbursed for payment for any other service, exam, or treatment which is performed as a result of and within 72 hours of responding to the ad for the free service, exam or treatment. ($99.00 value) Respondent's investigator, Julie Canfield-Buddin, saw the advertisement excluding Medicaid patients as recipients of the free services. After confirming that Petitioner was a Medicaid provider, Ms. Canfield-Buddin performed an audit of Petitioner's paid Medicaid claims between April 15, 1998, and December 31, 2001. The audit revealed that Petitioner had not provided the advertised free services to Medicaid patients. In other words, Petitioner had received Medicaid reimbursements for initial office visits and X-rays of new patients who were Medicaid eligible. Petitioner received reimbursements for these services even though Medicaid policy prohibits payments to providers for services that are given to non-Medicaid patients free of charge. In April 2002, Respondent sent Petitioner a preliminary audit report. The preliminary report indicated that for the period beginning April 15, 1998, up to and including December 31, 2001, Petitioner had received $13,522.02 for certain claims that were not covered by Medicaid. The report included a request for Petitioner to send Respondent that amount for the Medicaid overpayment. After receiving the preliminary report, Petitioner's office contacted Ms. Canfield-Buddin, stating that Petitioner had some issues with the denied claims. Ms. Canfield-Buddin responded that Petitioner should state his concerns in writing and furnish Respondent with any additional medical documentation that would serve to reduce the overpayment. Petitioner sent Ms. Canfield-Buddin a letter dated April 25, 2002. Petitioner did not send Respondent any additional medical documentation with the letter to substantiate his position regarding the denied claims. Additionally, Petitioner did not provide Respondent with any written office policy that delineated any difference in the services provided to Medicaid and non-Medicaid patients. In a final audit report dated May 9, 2002, Respondent informed Petitioner that he had been overpaid $13,522.02 for Medicaid claims that, in whole or in part, were not covered by Medicaid. The final audit report included a request for Petitioner to pay that amount for the Medicaid overpayment. Ms. Canfield-Buddin subsequently received a telephone call from Petitioner's office on May 30, 2002. She received Petitioner's written request for a formal administrative hearing on June 3, 2002. After receiving Petitioner's request for a hearing, Ms. Canfield-Buddin reviewed Petitioner's account statements that related to the Medicaid overpayments. Based on that review, Ms. Canfield-Buddin reduced the amount of overpayment to $11,077.65. The revised overpayment reversed denied charges for X-rays of Medicaid patients in excess of the two X-rays that should have been provided free of charge pursuant to the offer for free services. For example, Petitioner was reimbursed for services provided to B.A. on August 10, 2001. These charges included an initial office visit under the Current Procedures Terminology (CPT) code 99203, two X-rays under the CPT code 7240, two X-rays under the CPT code 72072, and two or three X-rays under the CPT code 72100. The final audit denied reimbursement for all charges except the two or three X-rays under CPT code 72100. The revised overpayment reversed the denied charges for two X-rays under the CPT code 72070. The end result was that Respondent denied Petitioner reimbursement only for the initial office visit and two X-rays that ordinarily would have been provided free to non-Medicaid patients. Medicaid allows reimbursement for services equal to the lesser of the Medicaid fee or the provider's usual and customary charge. Petitioner's advertisement offered free services to the public at large with certain exceptions. Petitioner cannot exclude Medicaid patients from that offer by also excluding patients with personal injury or workers' compensation claims. All patients who are not Medicaid eligible are non-Medicaid patients regardless of their payment source. Just because Petitioner excludes free services to non-Medicaid patients with personal injury and workers' compensation claims, does not mean that he can deny those free services to Medicaid patients when his usual and customary practice is to provide the services free to non-Medicaid patients. Some of the denied charges at issue here allegedly involve spinal manipulations that Petitioner claims he performed on Medicaid patients during their initial office visits. Medicaid reimbursement policy requires a spinal manipulation performed during an initial office visit under a 99203 CPT code for a new patient visit to be included as part of the examination conducted during that visit. Medicaid does not allow Petitioner to be separately reimbursed for a spinal manipulation performed on the same day of service as an initial office visit. Petitioner did not include more than two X-rays or any spinal manipulations in his offer of free services for any patient. When a patient has an initial office visit in response to Petitioner's offer of free services, Petitioner first takes the patient's history, performs an examination, and reviews the first two free X-rays. Depending on the results of the evaluation, Petitioner may or may not advise the patient that additional X-rays and/or a spinal manipulation are medically necessary. Petitioner then allows the patient to arrange for payment of those services with his office staff. If the patient is non-Medicaid eligible and is able to pay for services, Petitioner proceeds to take the additional X-rays and/or to perform the spinal manipulation immediately or during a subsequent visit with payment due as arranged. If a non-Medicaid patient requires subsequent examinations during the course of treatment, Petitioner bills the patient or his or her insurance carrier for those services. If the patient is Medicaid eligible, Petitioner may either proceed with taking the X-rays and/or performing the spinal examination immediately, knowing that he will not be separately reimbursed for the spinal manipulation, or make an appointment for the Medicaid patient to return on another day so that he can be reimbursed for the spinal manipulation. In any event, Medicaid regulations do not allow reimbursement for further examinations within a three-year period. During the hearing, Petitioner testified that some of the denied charges for initial office visits under the CPT code 99203 included spinal manipulations that he never intended to be free and that he did not provide spinal manipulations as a free service to non-Medicaid patients. Petitioner's testimony in this regard is not credited for two reasons. First, he did not produce any medical documentation to support his testimony as to any Medicaid patient receiving a spinal manipulation during an initial office visit. Second, he did not identify any such patient during his testimony. Respondent performs Medicaid audits after a provider renders services. Therefore, it is essential for providers like Petitioner, who contest denied claims, to be able to substantiate their billing with appropriate documentation. Such documentation must be created at the time of service, maintained pursuant to statutory and rule requirements, and furnished to Respondent upon request. Petitioner never responded to Ms. Canfield-Buddin's request for medical documentation to substantiate Petitioner's challenge to the denied claims. Additionally, Petitioner testified that the services he performed for some Medicaid patients were not equivalent to the free services he performed for non-Medicaid patients because they often involved a higher level of service, including additional services, tests, or examinations. According to Petitioner, some of the Medicaid patients required more extensive screening and counseling that consumed more of Petitioner's time. Despite this testimony, Petitioner admitted that the histories he took of Medicaid patients and non-Medicaid patients were basically the same. Petitioner testified that the difference in the level of service provided to all patients varied based upon the individual patients and did not depend on whether they were or were not Medicaid patients. He had no written or unwritten guidelines or policies that limited the scope of screening or level of service in an initial office visit for either type of patient. Petitioner's testimony that the level of services provided to Medicaid patients differed from the level of services offered to non-Medicaid patients is not persuasive. Once again, Petitioner failed to provide the required medical documentation to support his testimony or to identify in his testimony Medicaid patients who required a higher level of service. Moreover, Petitioner knew, when he made his offer of free services, that he would not be able to claim reimbursement for services provided to Medicaid patients that were not separately reimbursable even if Petitioner was entitled to exclude Medicaid patients from the offer. This includes cases where a Medicaid patient may have required a high level of service in terms of the time expended during the screening or a spinal manipulation during the initial office visit. Petitioner provides free services to members of his family. The provision of free services to family does not establish that Petitioner had a usual and customary practice of providing free services. At times, Petitioner treats police officers and indigent persons free of charge. However, Petitioner does not publicly advertise that he treats these patients free of charge because he does not want to be overrun with people taking advantage of the offer. There is no persuasive evidence that Petitioner routinely treats police officers covered by private health insurance and indigent patients covered by Medicaid free of charge. Therefore, it cannot be said that Petitioner's usual and customary practice is to furnish services to these patients free of charge. A Medicaid provider is allowed to use the CPT code 99203 for a new patient visit once per recipient every three years. Petitioner's offer of free services for non-Medicaid patients allows them one free office visit and two free X-rays regardless of the passage of time. According to Petitioner, this means that Respondent's interpretation of Medicare regulations would entitle a Medicaid patient to the free services every three years whereas a non-Medicaid patient would not be so entitled, showing yet another difference in the services provided to Medicaid and non-Medicaid patients under the offer of free services. However, Petitioner's testimony in this regard is not persuasive because it is not based on medical documentation or testimony showing that Petitioner ever treated a Medicaid patient as a new patient more than once.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That Respondent enter a final order determining that Petitioner owes $11,077.65 for Medicaid reimbursement overpayments. DONE AND ENTERED this 18th day of November, 2002, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD 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 18th day of November, 2002. COPIES FURNISHED: Anthony L. Conticello, Esquire Grant P. Dearborn, Esquire Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308-5403 Hal Cowen ChiroNetwork Health Care Centers 127 West 23rd Panama City, Florida 32405 Lealand McCharen, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 Valda Clark Christian, General Counsel Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building, Suite 3431 Tallahassee, Florida 32308
