The Issue The issue in this case is whether the Respondent, Agency for Health Care Administration, is liable to Petitioner, Miriam Lara, M.D., for attorney's fees and costs pursuant to Section 57.111, Florida Statutes, and, if so, the amount of attorney's fees and costs Petitioner should be awarded.
Findings Of Fact Respondent, the Agency for Health Care Administration (hereinafter referred to as the "Agency"), is the agency of the State of Florida responsible for the administration of the Federal government's Medicaid program in Florida. Section 409.907, Florida Statutes. One of the duties imposed upon states in order to participate in the Medicaid program is the duty to terminate any approved Medicaid provider where the provider has been "convicted" of certain types of crimes. See Social Security Act, Section 1128(a)(1), 42 U.S.C. Section 1230a-7. In particular, 42 U.S.C. Section 1230a-7(a)(1) requires the mandatory exclusion from the Medicaid program of any individual or entity that has been "convicted" of a program- related crime: Any individual or entity that has been convicted of a criminal offense related to the delivery of any item or service under subchapter XVII of this chapter or under any State health care program. For this purpose, the term "convicted" is defined to include "participation in a . . . deferred adjudication, or other agreement or program where judgement of conviction has been withheld." 42 U.S.C. Section 1230a-7(i)(4). Petitioner, Dr. Miriam Lara, is a licensed medical doctor and an approved Medicaid provider in the State of Florida. On January 20, 1998, Dr. Lara was indicted for "Organized Fraud and Medicaid Fraud." A copy of the Arrest Warrant, Respondent's Exhibit 9, was provided to the Agency shortly after Dr. Lara's arrest putting the Agency on notice of the charges against her. On or about November 30, 1998,1 Dr. Lara entered into a "Deferred Prosecution Agreement and Speedy Trial Waiver" (hereinafter referred to as the "DPA") which was filed in the Circuit Court of the Eleventh Judicial Circuit of Florida, in and for Dade County. Dr. Lara agreed, in part, to the following in the DPA: I, [sic] understand that I have been tentatively accepted as a participant in the Pretrial Diversion Program, and that the charges against me will not be prosecuted so as [sic] long as I am a program participant in good standing and that my case will not come to trail during that time. While it is clear from the DPA that the charges against Dr. Lara were not to be prosecuted so long as she participated in the program, the DPA does not specifically state that the charges would be dropped if she completed the program. Although the DPA is not specific, the Office of the Statewide Prosecution and Dr. Lara intended, when they entered into the DPA that the charges would be completely dropped if Dr. Lara completed the Pretrial Diversion Program. On April 20, 1999, after Dr. Lara successfully completed the pretrial program,2 the Office of Statewide Prosecution nolle prossed all charges pending against her. In early 1999 the Agency became aware that Dr. Lara had entered into and completed some type of "pretrial program." Ellen Williams, a Medicaid/Healthcare Program Analyst for the Agency, was notified that Dr. Lara had completed what Ms. Williams understood to be a "pretrial intervention program." The Agency, through Ms. Williams, also became aware of the disposition of Dr. Lara's case some time during 1999. Ms. Williams was provided with a copy of a disposition record for Dr. Lara's case from the Clerk of the Circuit and County Court of the Eleventh Judicial Circuit of Florida. That disposition record, Respondent's Exhibit 11, states that the charges against Dr. Lara had been "NOLLE PROS . . ." on April 20, 1999. The Agency, through Ms. Williams, believed that all pretrial programs involved a program through which an individual charged with a crime could, by participating in the program, avoid being adjudicated "guilty" of the charged offense. Because the information contained on the disposition record provided to Ms. Williams indicated that the charges had been nolle prossed and, this appeared to be inconsistent with the Agency's belief that all pretrial programs result in adjudication being withheld, Ms. Williams attempted to find out precisely what had happened to the criminal charges against Dr. Lara. Ms. Williams first telephoned and spoke with Assistant Attorney General Hugo Acebo, whom she understood to be an attorney, about the matter. Ms. Williams was told by Mr. Acebo that Dr. Lara had entered into some type of pretrial program and that she had successfully completed the program. Ms. Williams did not recall being told by Mr. Acebo that the charges against Dr. Lara had been dropped. Nor did she recall being told that any plea had been entered by Dr. Lara or adjudication on the charges had been withheld. Consistent with the Agency's belief about the nature of pretrial programs, Ms. Williams assumed that Dr. Lara, by successfully completing the pretrial program, had merely avoided being adjudicated guilty of the offenses for which she had been charged. Ms. Williams did not understand that the charges against Dr. Lara had been dropped. On October 12, 1999, a Case Closing Report on Miriam Lara, M.D. (hereinafter referred to as the "Closing Report"), Case No. 04-96-03-0016, was issued by the Office of the Attorney General, Medicaid Fraud Control Unit, Fort Lauderdale Bureau. In pertinent part, the Closing Report states the following: According to Assistant Attorney General Hugo Acebo, Dr. Lara entered into a pretrial intervention (PTI) program, which she successfully completed in April 1998. The charges against her were then dropped. . . . (Emphasis added). Ms. Williams received a copy of the Closing Report. The Agency, therefore, had actual notice that the charges against Dr. Lara had been dropped, but Ms. Williams continued to incorrectly believe that, because the Closing Report indicated that Dr. Lara had entered into a "pretrial intervention (PTI) program, which she successfully completed . . . " she had been "convicted" of a criminal offense that is Medicaid program- related, consistent with the Agency's incorrect understanding of pretrial programs. Marie del Carmen Calzone, Esquire, who represented Dr. Lara at the time, spoke to Ms. Williams at least three times after the charges against Dr. Lara had been dropped. Ms. Calzone explained to Ms. Williams that the charges had been nolle prossed or dropped, that Dr. Lara had not entered any adverse plea to the charges, that "adjudication had not been withheld," and that Dr. Lara had not, therefore, been "convicted." Ms. Williams, however, incorrectly insisted that, because Dr. Lara had engaged in a pretrial program and successfully completed it, she had been "convicted" as that term is defined for Medicaid purposes. Based upon Ms Williams' understanding of the Agency's interpretation of the pertinent law, Ms. Williams drafted a letter notifying Dr. Lara that her participation in the Florida Medicaid program was being terminated (hereinafter referred to as the "Termination Letter"). The Termination Letter indicates that the decision to terminate Dr. Lara's participation in the Medicaid program was based upon the following: The Agency for Health Care Administration has received information from the Attorney General, Office of Statewide Prosecution that indicates the following: You were indicted on January 20, 1998, for Organized Fraud and Medicaid Fraud. On November 20, 1998, you entered into a pretrial intervention program, which resulted in a nolle prosequi of the charges. The Social Security Act at section 1128(a)(1) provides for the mandatory exclusion from participation in the Medicaid program of any individual or entity convicted of a criminal offense that is program-related. Section 1128(I)(4) defines convicted to include "when the individual or entity has entered into participation in a first offender, deferred adjudication, or other arrangement or program where judgment of conviction has been withheld." Section 1902(p)(1) of the Social Security Act provides for state authority to take action to exclude providers from the Medicaid program for the reasons cited in section 1128. The Termination Letter was signed on or about April 13, 2001, almost two years after the charges against Dr. Lara had been nolle prossed. The Termination Letter was provided to Dr. Lara. Dr. Lara disputed the Agency's proposed action to terminate her participation in the Medicaid program and filed a Petition for Formal Hearing Pursuant to Section 120.569, Fla. Stat. (2001) and Petition for Other Relief Under Fla. Stat. and F.A.C. (hereinafter referred to as the "Petition for Formal Hearing"). The Petition for Formal Hearing was filed with the Division of Administrative Hearing on July 13, 2001. The matter was styled Miriam Lara, M.D. vs. Agency for Health Care Administration, and designated DOAH Case No. 01-2789. On September 18, 2001, realizing that Dr. Lara had not been "convicted" of any charges, the Agency filed a Notice of Withdrawal of Final Agency Action in the Underlying Case. Consequently, an Order Closing File was entered the same day, canceling the scheduled final hearing of the Underlying Case and closing the file of the Division of Administrative Hearings. As stipulated to by the parties, the Agency is an "agency" as defined in Section 57.111, Florida Statutes; the Agency initiated an administrative proceeding against Dr. Lara; the Agency was not a nominal party; and Dr. Lara, a "small business party" as defined in Section 57.111, Florida Statutes, was the "prevailing party" in the Underlying Case by virtue of the filing of the Notice of Withdrawal of Final Agency Action. The amount of reasonable attorney's fees incurred by Dr. Lara in the Underlying Case exceed $15,000.00. On November 26, 2001, Dr. Lara filed a Renewed Petition to Determine Amount of Attorney Fees and Costs Pursuant to Section 57.111, Fla. Stat. (2001) and Other Relief Under Fla. Stat. and F.A.C. (hereinafter referred to as the "Renewed Petition"). An Attorney Fee Affidavit has been attached to the Renewed Petition in which it is represented that attorney's fees in the amount of $18,279.50 were reasonably incurred in the Underlying Case, but also recognizing that fees and costs are capped at $15,000.00 under Section 59.111(4)(d)2., Florida Statutes. The Renewed Petition was designated Case No. 01-4669F. The pertinent information available to the Agency at the time it sent the Termination Letter to Dr. Lara included the following: Dr. Lara had been charged with criminal offenses that are program related in January 1998; Dr. Lara entered into a "Deferred Prosecution Agreement" in November 1998; Dr. Lara successfully completed the pretrial diversion program. At no time did she enter any plea to the charges and, therefore, there was no adjudication on the charges; and As a consequence of having completed the pretrial diversion program, all charges against her were dropped in 1999. All information necessary to determine that Dr. Lara had not been "convicted" of charges related to the Medicaid program was available to the Agency before action was taken to terminate her participation in the Medicaid program.
The Issue Whether Emergency Rule 10CER89-21 and an amendment of Rule 10C-7.0482, Florida Administrative Code, constitute an invalid exercise of delegated legislative authority?
Findings Of Fact The Parties and The Petitioners' Standing. The Petitioners, Hillhaven, United, Diversicare, HCRA, Americare and Waverly, are providers of long-term care services to elderly and disabled persons including Medicaid recipients. (S.F. 1). Petitioners have standing to raise their respective claims in this matter. (S.F. 38). The Department is an agency of the State of Florida. The Department is responsible for administering the Florida Medicaid program. (S.F. 3). The Federal Medicaid Program. General. Title XIX of the Social Security Act, codified at 42 U.S.C. 1396-1396s, and commonly referred to as the Medicaid Act, is a cooperative federal-state program. Under the Medicaid program, the federal government provides matching funds to states to help them provide their needy residents with necessary medical services. (S.F. 1). State Participation in the Program. State participation in the Medicaid program is not mandatory. A state which opts to participate, however, must submit to the Health Care Financing Administration (hereinafter referred to as "HCFA") of the Department of Health and Human Services (hereinafter referred to as "HHS") a "state plan for medical assistance" which meets all relevant federal requirements. 42 U.S.C. 1396a. (S.F. 2). Once HCFA approves a state's plan, that state is entitled to federal financial participation (hereinafter referred to as "FFP"), which means that HHS pays the state a certain percentage of amounts expended under the plan. 42 U.S.C. 1396b. The state must then administer the program in accordance with federal law, regulations and the approved state plan. 42 U.S.C. 1396c. (S.F. 2). Each state that participates in the Medicaid program must designate an agency to implement the Medicaid program in that state. 42 U.S.C. 1396(a)(5) and 42 C.F.R. 431.10. The state agency designated is not allowed to delegate its authority to administer or supervise the state plan. 42 C.F.R. 431.10(e). Amendment of a State Medicaid Plan. The mechanism for amending a state's Medicaid plan is set forth in 42 C.F.R. 447.256(c) and 430.20. (S.F. 10). In pertinent part, 42 C.F.R. 447.256(c), provides: A state plan amendment that is approved will become effective no earlier than the first day of the calendar quarter in which an approvable amendment is submitted in accordance with [42 C.F.R.] 430.20 and 447.253. In pertinent part, 42 C.F.R. 20(b)(2), provides that "[f]or a plan amendment that changes the State's payment method and standards, the [effective date] rules of [42 C.F.R.] 447.256 apply." The requirements for public notice of a proposed amendment to a state's Medicaid plan are set forth in 42 C.F.R. 447.205. (S.F. 11). The notice, pursuant to 42 C.F.R. 447.205(c), must include: Describe the proposed change in methods and standards; Give an estimate of any expected increase or decrease in annual aggregate expenditures; Explain why the agency is changing its methods and standards; Identify a local agency in each county (such as the social services agency or health department) where copies of the proposed changes are available for public review; Give an address where written comments may be sent and reviewed by the public; and If there are public hearings, give the location, date and time for hearings or tell how this information may be obtained. One of the requirements for federal approval of an amendment to a state plan is the requirement that the state provide payment rates in compliance with the "Boren Amendment", 42 U.S.C. 1396a(a)(13), and make findings and submit assurances to HCFA that: The Medicaid agency pays for . . . long-term care facility services through the use of rates that are reasonable and adequate to meet the costs that must be incurred by efficiently and economically operated providers to provide services in conformity with applicable State and Federal laws, regulations, and quality and safety standards. 42 C.F.R. 447.253(b)(1). The Medicaid Program in Florida. Florida's Participation. Florida participates in the Medicaid program pursuant to Section 409.266, Florida Statutes, and the Florida Title XIX Long-Term Care Reimbursement Plan (hereinafter referred to as the "Florida Medicaid Plan"). (S.F. 3). The Department is the agency responsible for administering the Florida Medicaid Plan. The Florida Medicaid Plan authorizes payments for nursing home services provided to eligible individuals in accordance with Medicaid regulations. (S.F. 3). Adoption and Approval of a Medicaid Plan. The Florida Medicaid Plan as revised January 1, 1988, was submitted by the Department to HCFA in accordance with 42 U.S.C. 1396A. The Department provided assurances to HCFA that Medicaid reimbursement rates under the January 1, 1988 Florida Medicaid Plan were reasonable and adequate to meet the costs which must be incurred by efficiently and economically operated facilities. See 42 U.S.C. 1396(a)(13)(A). (S.F. 4). HCFA approved the January 1, 1988, Florida Medicaid Plan effective January 1, 1988. (S.F. 4). The Florida Medicaid Plan. Under the January 1, 1988, Florida Medicaid Plan, long-term care providers such as the Petitioners are reimbursed under a prospective reimbursement methodology. Rates are set in advance of the rate semester based on historical cost data trended forward for inflation with no retroactive adjustment to account for actual costs for a cost reporting period (as opposed to actual reimbursement for the same period). (S.F. 5). Florida long-term care providers are divided into four classes based on geographic location and size. (S.F. 5). Each provider's rate consists of four components: (1) the property cost component; (2) the operating cost component; (3) the patient care cost component; and (4) a return on equity or use allowance. (S.F. 5). Reimbursement ceilings for patient care and operating cost components are established for each of the four classes. Ceilings are effective semiannually on January 1 and July 1. A statewide ceiling for the property cost component applies to providers who are reimbursed on the basis of depreciation and interest. Section 4B of the January 1, 1988 Florida Medicaid Plan. (S.F. 6). Providers that do not receive depreciation and interest for their property costs are reimbursed under the Fair Rental Value Systems (hereinafter referred to as "FRVS"). Under FRVS, reimbursement is based on the acquisition costs of a capital asset including capital additions and improvements subsequent to acquisition. These acquisition costs are indexed forward to October 1, 1985 by a portion of the rate of increase in the Dodge Construction Index. Id. Subsection V.E.I.a. (S.F. 7). The January 1, 1988 Florida Medicaid Plan also requires that the FRVS component of a provider's rate be adjusted semiannually using the change in the Dodge Index for the most recent six month period published prior to the rate semester. Id. Subsection V.E.I.a. The January 1, 1988 Florida Medicaid Plan requires semiannual inflationary adjustments, to become effective on July 1 and January 1 of each year. (S.F. 8). The January 1, 1988 Florida Medicaid Plan established Petitioners' Medicaid rates during the period January 1, 1988 through December 31, 1989. (S.F. 9). The Legislature's Appropriation of Funds for Medicaid. The appropriation for Florida's fiscal year 1989-1990 from the Florida Legislature included funds to reimburse Medicaid long-term care facility providers for the fiscal year July 1, 1989 through June 30, 1990 in accordance with the January 1, 1988 Florida Medicaid Plan. (S.F. 12). Florida's Budget Cuts and The Department's Response. During the fiscal year ending June 30, 1990, Florida experienced a shortfall in general revenue collections, and then-Governor Bob Martinez certified that a deficit would occur in the Florida state budget. (S.F. 13). In order to deal with the budget deficit, the Department was asked to provide cost containment alternatives to the Administration Commission (consisting of the Governor and the cabinet) which the Department did. (S.F. 13). Among the alternatives recommended by the Department was an amendment to the current Florida Medicaid Plan which would maintain Medicaid reimbursement rates for long-term care facilities at their December 31, 1989 level. This alternative was advocated by the Department as the most appropriate and fair of all the alternatives presented by the Department. (S.F. 13). In effect, the Department suggested that the Florida Medicaid Plan be amended to eliminate those provisions of the Florida Medicaid Plan providing for semiannual adjustments to the Medicaid reimbursement rate. Exhibit 2 is a true, correct and complete copy of an Impact Statement prepared by the Department and submitted to the Administration Commission concerning the proposed rate freeze that was accepted by the Administration Commission. This document was not submitted to HCFA. (S.F. 13). In the Impact Statement provided to the Administration Commission on November 21, 1989, the Department concluded that Florida nursing homes would receive 4% less than their anticipated costs due to the proposed freeze: Nursing Home Care ($13,131,931 GR) - This proposal will not allow nursing home per diem rates to increase based on their projected cost increases. The Medicaid Program will be reimbursing nursing homes 4.0% less than their anticipated costs. This price level reduction will impact on 489 participating nursing homes. There is no basis upon which to project the impact this will have on our clients [sic] ability to access those services of the quality of care received. This was the only analysis conducted by the Department prior to January 1, 1990, of Florida nursing home anticipated costs compared to the rates nursing homes would receive under the proposed rate freeze. On November 21, 1989, the Administration Commission, under the procedure outlined in Section 216.221, Florida Statutes, accepted the Department's proposal effective December 1, 1989 and reduced the Department's budget accordingly. (S.F. 13). The budget reductions ordered by the Administration Commission were taken from the Department's general revenue appropriation effective January 1, 1990, through mandatory reserves, or a holdback, of appropriations. The impact on the Department was that it had less authority to spend funds. The rate freeze approved by the Administration Commission allowed changes in rates due to licensure rating changes pursuant to Section V.D. of the January 1, 1988 Florida Medicaid Plan. (S.F. 13). A letter from the Department to nursing home administrators in Florida, including the Petitioners, dated January 29, 1990, was sent to Florida facilities affected by the rate freeze. The Department stated in the January 29, 1990, letter (exhibit 5), that the rate freeze would remain in effect until monies were appropriated by the Florida Legislature to recalculate new rates and ceilings. (S.F. 17). Promulgation of Rules Implementing the Rate Freeze. In order to effectuate the freeze, the Department caused to be published in the Florida Administrative Weekly on December 22, 1989, notice of Emergency Rule 10CER89-21 (10C-7.0482) (hereinafter referred to as the "Emergency Rule"). See exhibit 3. (S.F. 14). The Emergency Rule amended the Department's rules by providing that Florida Medicaid reimbursement would be in accordance with the January 1, 1988 Florida Medicaid Plan as revised January 1, 1990. See exhibit 4. (S.F. 14). The January 1, 1990 modifications to the January 1, 1988 Florida Medicaid Plan were attached to the notice of the Emergency Rule and were incorporated therein. (S.F. 14). The effect of the Emergency Rule was to eliminate the provisions of the January 1, 1988 Florida Medicaid Plan providing for recalculation of reimbursement rates, which recalculation would have included an inflationary adjustment, for the Petitioners' per diem Medicaid rates for the period beginning January 1, 1990. The Emergency Rule had the effect of maintaining the Petitioners' per diem Medicaid rates at the level in effect on December 31, 1989, excluding changes based on licensure rating reclassifications. The Emergency Rule did not limit the rate freeze to the period prior to June 30, 1990, and did not specify the date or approximate date on which the rate freeze would end. (S.F. 14). Emergency rules, however, are only effective for ninety days in Florida. Although the public notice of the Emergency Rule did not specify the anticipated increase or decrease in annual expenditures, notice of the general impact of the Emergency Rule was provided. On February 2, 1990, the Department caused to be published in the Florida Administrative Weekly notice of an amendment to Rule 10C-7.0482, Florida Administrative Code (hereinafter referred to as the "Permanent Rule"). See exhibit 6. (S.F. 15). The Permanent Rule eliminated the recalculation of reimbursement rates, which recalculation would have included an inflationary adjustment for Petitioners' per diem Medicaid rates for the period beginning January 1, 1990. The Permanent Rule maintained the Petitioners' per diem Medicaid rates at the level in effect on December 31, 1989, excluding changes based on licensure rating reclassifications. (S.F. 15). The Permanent Rule did not limit the rate freeze to the period prior to June 30, 1990 or specify the date or approximate date on which the rate freeze would end. The "purpose and effect" section of the Permanent Rule stated that the rate freeze would be in effect until sufficient funds were appropriated by the Legislature to recalculate rates and ceilings for Medicaid providers. (S.F. 15). By letter date March 15, 1990 (exhibit 8), a "Notice of Change" was filed by the Department with the Joint Administrative Procedures Committee. The Notice of Change modified the effective date of the Permanent Rule from March 22, 1990 to March 26, 1990. The Notice of Change was published in the Florida Administrative Weekly on March 23, 1990. Exhibit 27. (S.F. 19). No other public notices, or emergency or permanent rules, were published by the Department subsequent to February 2, 1990, which would have affected the Petitioners' Medicaid rates for the period January 1, 1990 through June 30, 1990. (S.F. 16). There are no documents which indicate that the Department enacted the Emergency Rule or the Permanent Rule for reasons other than those stated in the public notices for the Emergency Rule and the Permanent Rule and the January 29, 1990, letter. (S.F. 18). The Department enacted the Emergency and Permanent Rules solely due to the budgetary cuts ordered by the Administration Commission. The preamble to the Emergency Rule stated "[b]ased on a recent decision made by the Governor and Florida Cabinet, Medicaid rates were frozen at the December 31, 1989 levels for all providers of these institutions." The preamble to the Emergency Rule also stated that "a shortfall in general revenue requires the state to reduce or eliminate payment for needed services to medicaid recipients." Neither the preamble to the Emergency Rule nor the Permanent Rule indicated that Florida nursing homes had received excess reimbursement in relation to their costs under the 1988 Medicaid Plan. There was, however, no Florida law which required any other reason for the Emergency Rule or the Permanent Rule be provided by the Department. In a previous filing in this matter, the Department stated: "[i]n response to a shortfall in general revenue collections. . . , the Administration Commission (composed of the Governor and the cabinet) ordered the Department to "freeze" rates at the December 31, 1989 level. The amendment was made effective by [the Emergency Rule and the Permanent Rule]." See also Florida Nursing Home Association v. Department of Health and Rehabilitative Services, 12 FALR at 667 ("The Emergency Rule simply carries out the reductions ordered by the Administration Commission on November 21, 1989"). On January 29, 1990, Gary J. Clarke, Assistant Secretary for Medicaid of the Department, wrote to Nursing Home Administrators, including Petitioners, and stated that the rate freeze was enacted due to a decision made by the Administration Commission: Due to a projected general revenue deficit of $280 million for the State of Florida for fiscal year ending June 30, 1990, the Administration Commission met on November 21, 1989, to determine the appropriate budget reductions for all state programs. In order to reduce the Medicaid budget for its portion of the [DHRS] required reductions, yet avoid gross disruption of services, the Commission required that Medicaid reimbursement rates and ceilings for nursing home providers be frozen at their December 31, 1989 levels, beginning with the new rate Semester on January 1, 1990. . . There are no documents which include a representation contrary to the above quoted portion of the January 29, 1990 letter that the Department enacted the Emergency Rule or Permanent Rule for reasons other than the budgetary cuts ordered by the Administration Commission. The January 29, 1990 letter from the Department also indicated that the length of the rate freeze was indefinite: This policy shall remain in effect until such time that monies are appropriated by the Florida legislature to recalculate new rates and ceilings. Impact of the Emergency Rule and Permanent Rule on the Petitioners. The Petitioners received an inflationary adjustment in their Medicaid per diem rates on July 1, 1989 in accordance with the terms of the January 1, 1988 Florida Medicaid Plan. The Petitioners did not receive an inflationary adjustment in their per diem rates which would have been due on January 1, 1990 under the January 1, 1988 Florida Medicaid Plan for the period January 1, 1990 through June 30, 1990. Instead, Petitioners' rates calculated effective January 1, 1990 used the same cost reports and inflation adjustment that had already been included in their July 1, 1989 rates. (S.F. 36). The fact that the Petitioners did not receive an inflationary adjustment in their per diem rates for the period January 1, 1990 through June 30, 1990, was because the Emergency Rule and the Permanent Rule eliminated the rate increase provisions of the January 1, 1988 Florida Medicaid Plan. Notification to HCFA of the Rate Freeze. On March 30, 1990, HCFA received a letter dated March 22, 1990, from the Secretary of the Department submitting for consideration "a Title XIX state plan amendment to our state plan." (S.F. 20). The Secretary of the Department stated the following in the letter: This amendment TN 90-8 revises the plan by freezing the reimbursement rates and ceilings of all nursing home providers at the rates of reimbursement for services rendered on December 31, 1989. . . . . The assurances required by 42 CFR 447.253 and proof of public notice are attached. Exhibit 9. Attached to the Secretary's March 22, 1990, letter was a letter dated March 29, 1990, which along with State Plan Amendment Transmittal Number ("TN") 90-08 and proof of public notice, constituted all the documentation submitted by the Department to HCFA prior to July 1, 1990 concerning the rate freeze. (S.F. 20). TN 90-08, as submitted by the Department to HCFA on March 29, 1990, proposed to modify the Florida Medicaid Plan, as the Department had provided for in the Emergency Rule and the Permanent Rule, to eliminate the recalculation of rates, which recalculation would have included an inflationary adjustment for Petitioners' per diem Medicaid rates for the period beginning January 1, 1990. TN 90-08 proposed to maintain the Petitioners' per diem Medicaid rates at the level in effect on December 31, 1989, excluding changes based on licensure rating reclassifications. TN 90-08, as submitted on March 29, 1990, did 12not limit the rate freeze to the period prior to June 30, 1990. (S.F. 21). In the March 29, 1990 letter to HCFA, the Department referenced a telephone survey in which it had compared Florida Medicaid per diem rates to the per diem rates paid to long-term care facilities along the state borders between Florida and Georgia, and Florida and Alabama, under the Georgia and Alabama Medicaid programs. The Department estimated that this telephone survey was performed during the time period December, 1989 through February, 1990. In conducting the Georgia and Alabama telephone survey, the Department did not determine whether Georgia's or Alabama's long-term care facilities per diem rates were reasonable and adequate to cover the costs of efficiently and economically operating Georgia or Alabama facilities, and the Department did not determine whether Georgia or Alabama Medicaid programs covered the same or similar costs as the Florida Medicaid program. A copy of the survey materials was submitted as exhibit 10. Exhibit 10 was not provided to HCFA. (S.F. 22). In the March 29, 1990 letter, the Department referenced an analysis in which it stated that it had compared the increase in an inflationary index from 1989 to 1990 to the increase in the Medicaid rates paid to Florida long-term care facilities from 1989 to 1990. This analysis was performed during the period January, February, or March 1990. These materials were not submitted to HCFA. (S.F.23). The Georgia and Alabama telephone survey, the inflation analysis, and that portion of the data in Exhibit 15 generated prior to March 29, 1990 by the Department relating to Florida long-term care facility historical costs and prospective per diem rates were the only reports, surveys, analyses or studies performed by the Department (as of March 29, 1990) to support its assurances to HCFA that its rates for the period beginning January 1, 1990 were reasonable and adequate to cover the costs of efficiently and economically operated facilities in order to provide care and services in conformity with applicable state and federal laws, regulations, and quality and safety standards. (S.F.23). TN 90-08 was submitted to HCFA during the calendar quarter to which the Florida Medicaid Plan amendment was to be effective. TN 90-08 was reviewed by HCFA and a memorandum dated April 30, 1990, was written and circulated within HCFA concerning the proposed amendment. The memorandum indicates what the proposed amendment proposes, states that the review was conducted in accordance with Federal requirements and lists the assurances the State had given. The memorandum concludes, however, that "[a]fter review of the State's assurances and related information, HCFA does not yet have a reasonable basis upon which to accept the State's assurance that the proposed rates meet the 'reasonable and adequate' statutory standard of section 1902(a)(13)(A) of the Social Security Act " By letter dated May 9, 1990, HCFA notified the Department that: . . . we find that we cannot approve [the Plan amendment] as submitted. We are exercising our rights under section 1915(f) of the Social Security Act to request additional information and clarification as discussed below: . . . . Although HCFA did not deny or reject the Florida Medicaid Plan amendment submitted by the Department in the May 9, 1990, letter, HCFA did indicate that it could not approve the proposed amendment as submitted. It was recognized in the May 9, 1990, HCFA letter, as it was in the April 30, 1990, memorandum that a state may use budgetary considerations as one factor in establishing the rates to be paid providers as long as the rates are reasonable and adequate. It was also recognized in the May 9, 1990, HCFA letter that "the fact that rates in surrounding States are comparable to Florida's rates provides no justification whatsoever that its rates are reasonable and adequate. Rather, the HRS must compare its proposed rates with the costs that Florida facilities must incur in providing care and services." In the May 9, 1990, HCFA letter it is noted that the Department noted in its March 29, 1990, letter that rates are to be recalculated for the period beginning July 1, 1990, but that inconsistent language is included elsewhere in its proposal. Therefore, HCFA recommended that the Plan amendment be revised to limit the freeze to the six month period beginning January 1, 1990. The May 9, 1990, HCFA letter indicates that processing of the amendment would cease until the additional information and clarification were provided to HCFA. It is readily apparent from HCFA's April 30, 1990, memorandum and its letter of May 9, 1990, that HCFA was well aware of the requirements for amending a state Medicaid plan and the requirements that states must meet in setting Medicaid rates. The April 30, 1990, memorandum and the May 9, 1990, letter indicate that the original proposal submitted by the Department did not meet those requirements without further information being provided. HCFA did not, however, reject the Department's proposal or make any determination as to whether the proposed freeze was appropriate. HCFA merely indicated that more information was necessary and gave the Department an opportunity to provide it. On May 20, 1991, the Department submitted a letter to HCFA in response to the May 9, 1990, HCFA letter limiting the rate freeze to the six month period prior to July 1, 1990, and submitted a revised TN 90-08 to HCFA which included this change. Exhibit 18. (S.F. 30). In the May 20, 1991, Department letter the Department also referenced a second inflationary analysis. This inflationary analysis was performed by the Department in March or April, 1991. The inflationary analysis along with data generated by the Department relating to Florida long-term care facility historical costs and prospective per diem rates (exhibit 15) were the only reports, surveys, analyses or studies performed by the Department to support its May 20, 1991 assurances to HCFA that its rates for the period beginning January 1, 1990 were reasonable and adequate to cover the costs of efficiently and economically operated facilities in order to provide care and services in conformity with applicable State and Federal laws, regulations, and quality and safety standards. Exhibit 19 is a true, correct and complete copy of the written materials prepared by the Department in performing the inflationary analysis referenced in the May 20, 1991 letter. These documents were not submitted to HCFA. (S.F. 31). HCFA'S Approval of the Plan Amendment. By letter dated July 2, 1991, HCFA notified the Department that the Florida Medicaid Plan amendment TN 90-08 was approved with an effective date of March 26, 1990. By letter dated September 16, 1991, the Department advised HCFA that, as stated in the March 29, 1990, letter, the originally requested effective date of March 26, 1990, was an inadvertent error. It was pointed out that the correct effective date was January 1, 1990. By letter dated October 3, 1991, HCFA notified the Department that HCFA had approved the amendment to the Florida Medicaid Plan effective January 1, 1990. Elimination of the Rate Freeze. Effective July 1, 1990 the Florida Medicaid Plan was amended to remove the language of the Emergency Rule and Permanent Rule added effective January 1, 1990 which froze rates to their December 31, 1989 level. (S.F. 37). On August 7, 1991, HCFA approved the subsequent amendment, TN 90-13, with an effective date of July 1, 1990. This subsequent Florida Medicaid Plan amendment calculated the July 1, 1990 long-term care facility Medicaid reimbursement rates using the same inflation adjustment which would have been used on July 1, 1990 had the January 1, 1990 amendment never been implemented. No reimbursement relative to the January 1, 1990 amendment, however, was made retroactively to long-term care facilities for the period January 1, 1990 through June 30, 1990. (S.F. 37).
The Issue The issue for determination is whether Petitioner must reimburse Respondent for payments totaling $1,140,763.88 that Petitioner received from the Medicaid Program in compensation for the provision of prescription drugs between late-August and November of 1998. Respondent contends that Petitioner is not entitled to retain the payments in question because Petitioner allegedly has failed to demonstrate that it had available during the pertinent period a sufficient quantity of the prescription drugs in question.
Findings Of Fact The parties' Joint Stipulation of Facts and the evidence presented at final hearing established the facts that follow. The Parties The Agency for Health Care Administration (the “Agency”) is responsible for administering the Florida Medicaid Program. As one of its duties, the Agency must recover "overpayments . . . as appropriate," the term "overpayment" being statutorily defined to mean "any amount that is not authorized to be paid by the Medicaid program whether paid as a result of inaccurate or improper cost reporting, improper claiming, unacceptable practices, fraud, abuse, or mistake." See Section 409.913(1)(d), Florida Statutes. Palm Beach Pharmacy, Inc. (“PBPI”), d/b/a Eddie’s Drug (“Eddie’s”) was, at all times material hereto, a duly contracted Medicaid provider, having entered into a Medicaid Provider Agreement with the Agency and been assigned a Medicaid Provider Number: 106343000. Eddie’s is a Florida licensed pharmacy.1 As an enrolled Medicaid provider, Eddie’s is authorized to dispense drugs and supplies to Medicaid recipients. In return, Eddie’s has agreed to comply with all governing statutes, rules, and policies, including those policies set forth in the Florida Medicaid Prescribed Drug Services Coverage, Limitations and Reimbursement Handbook (the “Handbook”). The Agency, which prepared the Handbook and furnishes it to Medicaid providers, has incorporated the Handbook by reference into Rule 59G-4.250(2), Florida Administrative Code. PBPI, which owned and operated a number of pharmacies (including Eddie’s), maintained its corporate headquarters in West Palm Beach, Florida. Eddie’s was located in Miami, Florida. On July 1, 1998, PBPI acquired a drug store known as Jay’s Drugs (“Jay’s”). Jay’s was located in Miami, Florida, across the street from Eddie’s. Thus, before both stores came under common ownership, they had been competitors. This case arises out of the Agency's attempt to recover alleged overpayments on Medicaid claims for which Eddie’s was paid several years ago. The "audit period" that is the subject of the Agency's recoupment effort is April 1, 1998 to July 31, 1999, although the actual period in controversy is much shorter. From July 1, 1998, until the end of the audit period, PBPI owned and operated both Eddie’s and Jay’s. The Underlying Facts The transactions at the heart of this case occurred between late-August and November of 1998, during which period (the “Focal Period”) Medicaid reimbursed Eddie’s more than $1 million for prescription drugs including Neupogen and Epogen/Procrit (collectively, the “Drugs”). The Drugs are used to treat AIDS patients and persons infected with HIV. Prior to the Focal Period, Eddie’s had not dispensed $1 million worth of the Drugs——or any figure approaching that amount——in three or four months’ time. The reason for the dramatic spike in Eddie’s business is that Eddie’s was dispensing the Drugs to customers of Jay’s pursuant to an arrangement designed to manipulate PBPI’s contractual obligations to the former owner of Jay’s under the purchase and sale agreement by which PBPI had acquired Jay’s. Essentially, the arrangement was this. Jay’s was dispensing the Drugs to a large number (approximately 150) of Medicaid beneficiaries who were receiving treatment at a nearby clinic. Because the Drugs were administered to the patients via intravenous infusion, the clinic typically obtained the Drugs from Jay’s in bulk. To fill these prescriptions, Jay’s ordered the Drugs from a wholesale supplier, which usually delivered the Drugs to Jay’s the next day. At some point before the Focal Period, arrangements were made to have the clinic present its prescriptions for the Drugs to Eddie’s rather than Jay’s.2 The evidence does not show, exactly, how this was accomplished, but whatever the means, the clinic abruptly began bringing prescriptions for the Drugs to Eddie’s.3 This diversion of Jay’s’ business to Eddie’s was intended to deprive Jay’s of Medicaid reimbursements to which Jay’s’ former owner had access as a source of funds for paying down a note that PBPI had given for the purchase of Jay’s. By having Eddie’s dispense the Drugs and submit the Medicaid claims, Medicaid money flowed into Eddie’s’ bank account (rather than Jay’s’ bank account) and hence was not immediately available to the former owner of Jay’s to reduce PBPI’s debt. During the Focal Period, Eddie’s did not purchase the Drugs from a wholesaler but instead acquired them from Jay’s. The process by which this was accomplished involved a pharmacy technician named Wright, who was employed at Eddie’s, and a pharmacist named Shafor, who worked at Jay’s. Wright (at Eddie’s) accepted the prescriptions for the Drugs as the clinic brought them in Then, she called Shafor (at Jay’s) and told him the quantities needed to fill the prescriptions. Shafor ordered the Drugs from a wholesaler, which delivered them in bulk to Jay’s, usually the next day. Upon receiving the Drugs, Shafor personally delivered them to Wright, who, recall, was across the street at Eddie’s. Wright labeled and dispensed the Drugs. Eddie’s submitted a claim for the Drugs to Medicaid, and Medicaid paid Eddie’s. PBPI maintained separate accounting ledgers for Eddie’s and Jay’s, respectively. The company’s accountants recorded the subject transactions in these ledgers so that Jay’s——not Eddie’s——would “recognize” the sales of the Drugs. In a nutshell, this was done through “inter-company” transfers whereby all of the money that Eddie’s received from Medicaid for the Drugs was moved, on the books, into an account of Jay’s. In this way, any profit from the sales of the Drugs (the difference between the wholesale cost of the Drugs and the Medicaid reimbursement therefor, less overhead) was realized on Jay’s’ books.4 The Medicaid payments to Eddie’s that the Agency seeks to recoup were included in four remittance vouchers dated September 2, 1998; September 30, 1998; October 28, 1998; and November 25, 1998, respectively. The September 2 payment to Eddie’s totaled $287,205.52. Of this amount, $276,033.23 reimbursed Eddie’s for dispensing the Drugs. Eddie’s’ accounting ledger reflects that, as of September 30, 1998, the sum of $276,033.23 had been transferred from an account of Eddie’s to an account of Jay’s. The September 30 payment to Eddie’s totaled $439,175.77, of which $432,700.36 was paid in consideration of the Drugs. The October 28 Medicaid payment was $431,753.82, of which total the Drugs accounted for $424,202.76. Eddie’s’ accounting ledger reflects that, as of October 31, 1998, the sum of $870,929.59 (439,175.77 + 431,753.82) had been transferred from an account of Eddie’s to an account of Jay’s. The November 25 payment to Eddie’s totaled $407,088.00. Of this amount, $393,063.00 reimbursed Eddie’s for dispensing the Drugs. Eddie’s’ accounting ledger reflects that, as of November 30, 1998, the sum of $407,088.00 had been transferred from an account of Eddie’s to an account of Jay’s. The Agency’s Allegations On October 31, 2000, the Agency issued its Final Agency Audit Report (“Audit”) in which Eddie’s was alleged to have received $1,143,612.68 in overpayments relating to the Drugs. In the Audit, the Agency spelled out its theory of the case; indeed, the Audit is the only document in the record that does so. The Agency cited several statutory provisions. First, Section 409.913(7)(e), Florida Statutes, was referenced. This section states: When presenting a claim for payment under the Medicaid program, a provider has an affirmative duty to supervise the provision of, and be responsible for, goods and services claimed to have been provided, to supervise and be responsible for preparation and submission of the claim, and to present a claim that is true and accurate and that is for goods and services that: * * * (e) Are provided in accord with applicable provisions of all Medicaid rules, regulations, handbooks, and policies and in accordance with federal, state, and local law. Section 409.913(7)(e), Florida Statutes. The Agency did not allege (or prove), however, that Eddie’s had violated Section 409.913(7)(e), Florida Statutes.5 Put another way, the Agency did not plead or prove lack of supervision, submission of a false claim, or that the Drugs were not provided in accordance with applicable law. Next, the Agency cited Section 409.913(8), Florida Statutes, which provides: A Medicaid provider shall retain medical, professional, financial, and business records pertaining to services and goods furnished to a Medicaid recipient and billed to Medicaid for a period of 5 years after the date of furnishing such services or goods. The agency may investigate, review, or analyze such records, which must be made available during normal business hours. However, 24-hour notice must be provided if patient treatment would be disrupted. The provider is responsible for furnishing to the agency, and keeping the agency informed of the location of, the provider's Medicaid- related records. The authority of the agency to obtain Medicaid-related records from a provider is neither curtailed nor limited during a period of litigation between the agency and the provider. The Agency further alleged, as fact, that Eddie’s had failed, upon request, “to submit invoices from [its] suppliers to substantiate the availability of drugs that [were] billed to Medicaid” and thus had not “fully substantiated such availability.” The Agency, however, did not invoke any of the available remedial provisions as authority to impose a sanction for this alleged failure to turn over Medicaid-related records. See, e.g., Sections 409.913(14)(b), (c), and (d), Florida Statutes. The Agency cited Section 409.913(10), Florida Statutes, which authorizes the Agency to “require repayment for inappropriate, medically unnecessary, or excessive goods or services from the person furnishing them, the person under whose supervision they were furnished, or the person causing them to be furnished.” There was no allegation (or proof), however, that the Drugs which Eddie’s had purported to dispense (i.e. the Drugs for which it had submitted Medicaid claims) were “inappropriate, medically unnecessary, or excessive.” Thus, Eddie’s was not alleged (or shown) to have violated Section 409.913(10), Florida Statutes. Finally, the Agency relied upon Section 409.913(14)(n), Florida Statutes, which is the basis of the Agency’s legal theory. This section provides: The agency may seek any remedy provided by law, including, but not limited to, the remedies provided in subsections (12) and (15) and s. 812.035, if: * * * (n) The provider fails to demonstrate that it had available during a specific audit or review period sufficient quantities of goods, or sufficient time in the case of services, to support the provider's billings to the Medicaid program[.] The Agency contended, additionally, that “[b]illing Medicaid for drugs that have not been demonstrated as available for dispensing is a violation of the Medicaid laws and regulations and has resulted in the finding that [Eddie’s] ha[s] been overpaid by the Medicaid program.” (Emphasis added). The Agency explained, “Medicaid payments that have been substantiated by documented inventory are assumed to be valid; and payments in excess of that amount are regarded to be invalid.” Thus, the Agency’s theory of recovery is that Eddie’s must forfeit “overpayments” arising from its failure to demonstrate the availability, in inventory, of a sufficient quantity of the Drugs for which claims were submitted, as required by Section 409.913(14)(n), Florida Statutes. After the Audit was issued, the Agency accepted a handwritten note regarding the transfer of a small quantity of Drugs from Jay’s to Eddie’s as sufficient to demonstrate the availability of such amount. This resulted in a slight reduction of the amount of the alleged overpayment, to $1,140,763.88. The Separate Audit of Jay’s The Agency conducted a separate audit of Jay’s, concerning which some evidence was introduced at hearing. Without getting into unnecessary detail, the audit of Jay’s revealed that Jay’s had purchased, during and around the Focal Period, a quantity of the Drugs that exceeded the number of units that Jay’s had billed to Medicaid. It was Eddie’s theory that this “excess inventory” of Jay’s matched, more or less, the alleged inventory shortfall at Eddie’s, thereby corroborating the testimony concerning the transfer of these Drugs from Jay’s to Eddie’s for dispensation. At hearing, the parties sharply disputed whether, in fact, Jay’s had transferred the Drugs to Eddie’s. The Agency, of course, maintained that such transfers were not properly documented; Eddie’s argued that the documents and other evidence, including testimony about the transactions in question, adequately demonstrated that the transfers had, in fact, occurred. There was no dispute, however, that if it were found that such transfers had occurred, and if, further, the documents (and other evidence) pertaining to the inventory of Jay’s were accepted as proof of the quantities of Drugs so transferred, then all but $176,078.30 worth of the Drugs could be accounted for. Thus, as counsel for Eddie’s conceded at hearing, the Agency is entitled to recoup some sum of money. The question is whether that sum is $1,140,763.88 or $176,078.30. Ultimate Factual Determination Based on all of the evidence in the record, including the deposition testimony received through the parties’ joint stipulation, it is determined that, more likely than not, Eddie’s had available during the Focal Period a sufficient quantity of the Drugs to support all but $176,078.30 worth of the claims in dispute.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Agency enter a final order requiring Eddie’s to repay the Agency the principal amount of $176,078.30. DONE AND ENTERED this 12th day of March, 2002, in Tallahassee, Leon County, Florida. 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 12th day of March, 2002.
Findings Of Fact Based on the record evidence and the admissions made by Sandbank at hearing, the Hearing Officer makes the following findings of fact: Stanley Sandbank has been a licensed pharmacist in the State of Florida since 1975 and has actively engaged in the practice of pharmacy in this state since 1982. During the Fall of 1987, Sandbank was employed as a pharmacist at Rite- Aid Discount Pharmacy 2165 in Miami Beach, Florida. Toward the latter part of November of that year, Rite-Aid management received a telephone call from a Drug Enforcement Administration (DEA) agent, who stated that she had obtained a tip from a reliable informant that Sandbank "was selling drugs on the street." The DEA agent suggested that a controlled audit be conducted to ascertain whether these drugs were being misappropriated from the pharmacy at which Sandbank worked. Rite-Aid management followed the DEA agent's suggestion and performed such a controlled audit. The audit was completed on November 25, 1987. It revealed that 154 dosage units of Percocet and 201 dosage units of Percodan were unaccounted for and missing from the pharmacy's inventory of controlled substances. Percocet is a brand name of a "medicinal drug," as defined in Section 456.003(7), Florida Statutes, which contains Oxycodone, a controlled substance listed in Schedule II of Chapter 893, Florida Statutes. Percodan is a brand name of a "medicinal drug," as defined in Section 465.003(7), Florida Statutes, which also contains Oxycodone. Because Sandbank was the only pharmacist on duty during the time the audit was conducted, Rite Aid management believed that he was responsible for the shortages that had been discovered. Sandbank initially denied knowing anything about the matter, but later admitted his transgression. As Sandbank freely admitted, he had removed from the pharmacy and delivered to relatives and neighbors the following approximate quantities of controlled substances without first having been presented with a valid prescription and without Rite-Aid having received payment in full for these controlled substances: CONTROLLED SUBSTANCE QUANTITY Valium 10 mg. 300 Diazepam 10 mg. 400 Percodan 375 Percocet 360 Dilaudid 100 Hycodan Syrup 240 Placidyl 750 mg. 30 Valium, Dilaudid, Hycodan Syrup, and Placidyl are brand names of "medicinal drugs," within the meaning of Section 465.003(7). Valium contains Diazepam, which is a controlled substance listed in Schedule IV of Chapter 893, Florida Statutes. Dialudid contains Hydromorphone, which is a controlled substance listed in Schedule II of Chapter 893, Florida Statutes. Hycodan Syrup contains Hydrocodone, which is a controlled substance listed in Schedule III of Chapter 893, Florida Statutes. Placidyl contains Ethchlorvynol, which is a controlled substance listed in Schecdule IV of Chapter 893, Florida Statutes. Sandbank kept at least a portion of the money he had been given by this neighbors and relatives for having delivered to them the above-described controlled substances. He therefore reaped a financial gain as a result of his unauthorized and surreptitious diversion of these controlled substances from Rite-Aid Discount Pharmacy #2165.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Board of Pharmacy enter a Final Order finding that Stanley Sandbank violated Section 465.016(1)(e), Florida Statutes, as alleged in the Administrative Complaint, and imposing the above-described disciplinary action which the Department of Professional Regulation has proposed. DONE and ENTERED this 25th day of April, 1989, in Tallahassee, Florida. STUART M. LERNER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 25th day of November, 1989. COPIES FURNISHED: Michael A. Mone', Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Stanley Sandbank 4300 Sheridan Street Hollywood, Florida 32399-0750 Rod Presnell, Executive Director Board of Pharmacy Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Kenneth D. Easley, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750
The Issue Whether Petitioner, Agency for Health Care Administration (AHCA or Petitioner), is entitled to a recoupment for a Medicaid overpayment to Respondent, Humane Minority, Inc. (Humane or Respondent), in the amount of $177,581.26.
Findings Of Fact Petitioner is the state agency responsible for administering the Florida Medicaid Program. As part of its duties, Petitioner attempts to recover Medicaid overpayments from Medicaid providers. At all times material to this case, Humane was licensed to provide various health care services to Medicaid recipients under a contract to AHCA as a Medicaid provider. As provider number 255724000, Humane participated in the Medicaid program from January 1, 2005, to February 8, 2006 (audit period). As a Medicaid provider, Respondent was subject to audit. This case arose when the Discovery Unit of Medicaid Program Integrity (MPI) identified that during the audit period Humane billed 1.5 times as much for one week as compared to ten other weeks, which is an indicator of billing irregularities. As a result, the Discovery Unit of MPI recommended a comprehensive audit of Humane. Gary Mosier, a Registered Nursing Consultant employed by AHCA in the bureau of MPI, initiated the audit of Humane after receiving the Discovery Unit’s File #47650 Recommendation memo dated May 19, 2006, referring Humane for a comprehensive audit. On or about June 13, 2006, MPI requested 30 random Medicaid patients' records from Humane’s entire Medicaid patient group for the audit period. Humane complied with the request and supplied records. The submitted medical records included a Certificate of Completeness of Records from Humane stating the documents supplied constituted all of the Medicaid-related records for the 30 patients during the Audit period. After Humane provided the requested medical records to Mosier, he forwarded the records to three physician consultants: Machado, a general practitioner; Edgar, a psychiatrist; and Reisman, an urologist. Each physician consultant reviewed Humane’s records relevant to his area of expertise and filled out agency worksheets detailing why claims should be disallowed. MPI reviewed Humane’s records provided and the worksheets filled out by the three physician consultants and determined that overpayments were made to Humane due to numerous services in whole or in part not being covered by Medicaid, which violated various Medicaid policy guidelines set forth in both the Florida Medicaid Provider General Handbook (General Handbook)1 and the Florida Medicaid Physician Services Coverage and Limitations Handbook (Physician Services Handbook).2 Humane violated policy by providing documentation that supported a lower level of office visit than the one for which Humane billed and received payment. Humane violated policy by billing and receiving payments for some services that were not documented. Humane violated policy by billing and receiving payment for services rendered by a practitioner who was not a member of Humane’s group. Humane violated policy by billing for procedure codes that have time requirements but not documenting the time spent providing the service. Humane violated policy by billing and receiving payment for services performed by another practitioner who was not enrolled in Medicaid at the time the services were rendered. Humane violated policy by billing and receiving payment for services for which the medical records, when reviewed by a Medicaid physician consultant, indicated that the services provided did not meet the Medicaid criteria for medical necessity. Humane violated policy by billing for radiology services when the reading and interpretation was done by a radiologist outside of the physician’s group. Humane violated policy and was paid for billing and received payment for portable x-ray services where Humane performed only the technical component and an independent interpreter performed the professional component. Humane violated policy and received payment when Humane did not bill according to the current procedural terminology guidelines in certain instances. On March 13, 2007, MPI issued its Preliminary Audit Report (PAR). The report detailed the Medicaid policy violations, overpayment amounts, and provided Humane the opportunity to submit an explanation or additional documentation demonstrating that some or all of the claims were properly paid. The report also notified Humane that a Final Audit Report (FAR) would be issued identifying the amount of overpayment due. Humane did not respond to the PAR. Consequently, on April 27, 2007, MPI issued a FAR, that included the amount of $177,581.26 that Humane received from Medicaid that was not authorized to be paid. This grand total of $177,581.26 constitutes an overpayment that Humane must return to the agency. A Final Audit Report-Corrected Copy was issued on May 22, 2007, correcting the total amount due.3 In addition to the overpayment amount, Petitioner also seeks a fine in the amount of $3,000.00. The fine is a calculated amount as authorized by rule.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Agency enter a final order requiring Humane to repay the Agency for the principal amount of $177,581.26 together with an administrative fine of $3000.00. DONE AND ENTERED this 22nd day of June, 2009, in Tallahassee, Leon County, Florida. S JUNE C. McKINNEY 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 22nd day of June, 2009.
The Issue The issue is whether Respondent failed to maintain a service plan for each of four residents, in violation of the Florida Medicaid Assistive Care Services Coverage and Limitations Handbook. If so, an additional issue is the sanctions that should be imposed.
Findings Of Fact Respondent owns and operates an assisted living facility known as Izquierdo Home Care I. At all material times, Respondent was enrolled in the Medicaid program as a provider authorized to supply assistive living services to Medicaid recipients at Izquierdo Home Care I. At all material times, Respondent was subject to the Florida Medicaid Assistive Care Services Coverage and Limitations Handbook. The handbook imposed upon Respondent the duty to develop a service plan for each Medicaid recipient not less often than annually. On March 27, 2012, Petitioner's inspector conducted a site visit of Izquierdo Home Care I. At the time of the site visit, the facility had six beds, but only four residents. According to a letter from Petitioner dated March 27, 2012, and delivered to Respondent's representative at the time of the inspection, the following four residents were Medicaid recipients: E. C., R. R., J. H., and A. R. However, according to the questionnaire completed by Respondent's representative at the time of the inspection, only two of the four current residents were Medicaid recipients, although the questionnaire does not identify these residents. In fact, A. R. had been discharged from Izquierdo Home Care I in September 2011. At the hearing, Petitioner's inspector confirmed that Respondent had not billed Medicaid for services for A. R. after the date of discharge. The second resident whose Medicaid status is in question was identified, in Respondent's proposed recommended order, as E. C. Respondent contends in its proposed recommended order that E. C. was not receiving Medicaid at the time of the inspection. If the Proposed Recommended Order were the only notice to Petitioner of Respondent's claim that a second resident was not a Medicaid recipient, the Administrative Law Judge would ignore this assertion because it is not evidence, and, as a defense, it was raised too late. However, the questionnaire, which was admitted as one of Petitioner's exhibits, is evidence that two of the four residents were not receiving Medicaid at the time of the inspection. In assessing the evidentiary record in terms of whether it establishes a third Medicaid recipient, the Administrative Law Judge notes: a) Petitioner has alleged a violation concerning A. R., even though A. R. was no longer a Medicaid recipient at the time of the inspection; b) at hearing, Petitioner's inspector was readily able to read the "query" to confirm that Respondent had not submitted a Medicaid billing on account of A. R. after September 2011 (Transcript 49); and c) as discussed in the Conclusions of Law, Petitioner bears the burden of proof by clear and convincing evidence. Under these circumstances, Petitioner has proved only that two residents of the facility were Medicaid recipients at the time of the inspection. There is no dispute that current service plans for two Medicaid recipients did not exist at the time of the March 2012 inspection.
Recommendation It is RECOMMENDED that the Agency for Health Care Administration enter a final order imposing a fine of $2000 against Respondent. DONE AND ENTERED this 26th day of October, 2012, in Tallahassee, Leon County, Florida. S ROBERT E. MEALE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 26th day of October, 2012. COPIES FURNISHED: Jeffries H. Duvall, Esquire Office of the General Counsel Agency for Health Care Administration Fort Knox Executive Center, Building 3 2727 Mahan Drive, Mail Station 3 Tallahassee, Florida 32308-5403 Julia Arrendell, Qualified Representative 13899 Biscayne Boulevard North Miami Beach, Florida 33181 Elizabeth Dudek, Secretary Office of the General Counsel Agency for Health Care Administration Fort Knox Executive Center, Building 3 2727 Mahan Drive, Mail Station 3 Tallahassee, Florida 32308-5403 Stuart Williams, General Counsel Office of the General Counsel Agency for Health Care Administration Fort Knox Executive Center, Building 3 2727 Mahan Drive, Mail Station 3 Tallahassee, Florida 32308-5403 Richard J. Shoop, Agency Clerk Office of the General Counsel Agency for Health Care Administration Fort Knox Executive Center, Building 3 2727 Mahan Drive, Mail Station 3 Tallahassee, Florida 32308-5403
The Issue The issue for determination is whether Respondent was overpaid $312,773.67 for claims which, according to Petitioner, did not comply with Medicaid requirements.
Findings Of Fact Petitioner Agency for Health Care Administration ("AHCA") is the state agency responsible for administering the Florida Medicaid Program ("Medicaid"). At all relevant times, Respondent has been a Home and Community Based (HCB) Medicaid provider that is authorized to receive reimbursement for covered services rendered to Medicaid recipients. Developmental Disability Home and Community Based Services Waiver Program The alleged overpayment in this case relates to services Respondent provided through the Medicaid Developmental Disability Home and Community Based Waiver Program ("the Program"). As explained during Ms. Olmstead's final hearing testimony, the Program was established to help developmentally- disabled individuals remain in their homes or home-like settings within the community, as opposed to institutions such as nursing homes or intermediate care facilities. Medicaid recipients that desire to receive services through the Program undergo an initial evaluation performed by a waiver support coordinator. The support coordinator is a Medicaid provider that is selected by the Medicaid recipient or his or her guardian. To determine the services needed by the recipient to remain in the home, the support coordinator assesses the recipient by conducting an in-home visit. Upon completion of this initial assessment, the support coordinator formulates a "support plan," a document which describes the recipient's personality, likes, dislikes, strengths, and weaknesses, as well as the recipient's existing support system, such as family, friends, and neighbors. In addition, the support plan details the services the recipient needs to stay in the home and identifies who will provide the services. The expected costs of the proposed services are described on a form titled "cost plan," which, combined with the support plan, comprise the plan of care for the recipient. The support coordinator is required to submit the plan of care, as detailed in the support plan and cost plan, to the Department of Children and Families ("DCF"). If the plan of care is approved, DCF staff will create a "service authorization form." This form, which the support coordinator forwards to the service provider, describes the services to be rendered, as well as the duration and frequency of each service. Without the service authorization form, a provider cannot be assured payment from Medicaid. At least one time per year, the support coordinator must assess the recipient's needs, complete updated support and cost plans, and submit the updated plans for approval. If the updated plan of care is approved, DCF will draft a new service authorization form, which is forwarded to the provider by the support coordinator, along with copy of pertinent support plan information. Should the recipient's services or support require modification, the support coordinator is required to update the cost report and submit it for approval. Communication between the support coordinator and providers such as Respondent is encouraged, as the support coordinator reviews with the provider the goals to be achieved for the recipient. A service provider is expected to assist in establishing support plan outcomes for a recipient's goals and participate in the personal outcome process. Moreover, a service provider expressly consents to such communication by virtue of the provider's contract with Medicaid, which includes an agreement to participate in discussions with the support coordinator on matters such as a recipient's progress, the extent to which a recipient's needs are being met, and modifications to the recipient's support plan. The Preliminary Audit and Final Audit Exercising its statutory authority to oversee the integrity of Medicaid, Petitioner conducted a review or audit of Respondent's records to verify that claims paid by Medicaid during the period from January 1, 2003, through December 31, 2004 (the "audit period"), were billed and paid in accordance with Medicaid statutes, rules, and policies. As the average number of claims per recipient during the audit period was substantial, Petitioner utilized "two stage cluster sampling." This first stage involved a random selection of 34 receipts for whom Respondent submitted claims during the audit period. Next, from those 34 recipients, a total of 255 claims was randomly selected. On October 7, 2005, AHCA requested that Respondent provide "the documentation for services paid by the Florida Medicaid Program" in connection with the 255 claims that comprised the random sample. On or about October 21, 2005, Respondent submitted 37 packages of documents in response to Petitioner's request. Respondent also executed an affidavit which alleged that the documents were true and correct copies, and that the records were made at or near the time that the services were rendered. The documents submitted by Respondent were initially examined by Ms. Effie Green, a program analyst employed by Petitioner. Ms. Green immediately noticed that the records from at least some of the packages were covered in dust with a crystal-like appearance. Law enforcement officers called to the scene ultimately determined that the substance was harmless. There is no evidence that any of the records were tampered with or removed from Petitioner's offices during the investigation. On the contrary, the evidence demonstrates that the documents remained in Ms. Green's office until the dust was analyzed. Following the events described above, the audit of Respondent's records was delayed for approximately one year while an appeal, which involved a different Medicaid provider, was completed. The appeal, which was resolved in AHCA's favor, concerned the validity of the statistical formula utilized in calculating probable Medicaid overpayments.4 The responsibility of reviewing the documents provided by Respondent was later transferred to Ms. Robin Satchell, an investigator employed by Petitioner in the Bureau of Program Integrity. Prior to her employment with AHCA, Ms. Satchell worked for eight years as an HCB Medicaid provider. Ms. Satchell fully reviewed the records previously submitted on October 20, 2005, and also examined additional records subsequently provided by Respondent to verify that the claims paid during the audit period were billed and paid in accordance with Medicaid statutes, rules, and policies. Rules applicable to the claims reviewed in this case are enumerated in the Florida Medicaid Developmental Services Waiver Services Coverage and Limitations Handbook, and include: Only those services that have been identified in a recipient's plan of care and which have been approved and authorized prior to delivery are covered. Providers are limited to the amount, duration, and scope of the services described on the recipient's support plan and current approved cost plan. Only those services that are medically necessary are covered. Services furnished through the developmental disability waiver program are deemed to be medically necessary only if certain elements are present, including but not limited to the following: the service is not in excess of the recipient's needs; and, the service is furnished in a manner not primarily intended for the convenience of the recipient, the recipient's caregiver, or the provider. In order to receive payment for services, the provider must document the service appropriately. Documentation is a written record that supports the fact that a service has been rendered. Depending upon the particular service provided (e.g., Personal Care Assistance, Homemaker Services, Chore Services), the documentation requirements may vary and are detailed in the Florida Medicaid Developmental Services Waiver Services Coverage and Limitations Handbook. On May 24, 2007, AHCA issued a Final Agency Audit Report, which alleged that Respondent was overpaid $1,647,960.81 during the audit period for services that were not covered by Medicaid. Following the issuance of the Final Agency Audit Report, and as announced at the outset of the final hearing in his matter, Petitioner now alleges that Respondent was overpaid $312,773.26. The manner in which AHCA reached the alleged overpayment of $312,773.67 is as follows: of the 255 claims examined by Ms. Satchell, 197 were allowed.5 Ms. Satchell made downward adjustments to 52 claims, and 6 were denied outright. Based upon the adjustments and denials, Ms. Satchell concluded that Respondent had received $1,287.26 in reimbursement of claims in the sample for services not covered by Medicaid, either in whole or in part. Having discovered this "empirical overpayment" of $1,287.26, AHCA employed a statistical formula to ascertain the "probable total overpayment" that Respondent received from Medicaid in connection with the total number of claims made during the Audit Period.6 As noted above, Petitioner contends that the "probable total overpayment" is $312,773.67. In her Proposed Recommended Order, Respondent asserts that with respect to the entire sample of claims, only one instance of incorrect billing occurred. In particular, Respondent concedes that that services provided to Recipient number 24 on September 2, 2003, were inadvertently overbilled in the amount of $0.96. Respondent disputes the remaining 51 downward adjustments and six outright denials, which are discussed separately below by recipient.7 Recipient No. 1 The support plan for this recipient authorized Personal Care Assistance, which is described in the Florida Medicaid Developmental Services Waiver Services Coverage and Limitations Handbook as follows: service that assists a beneficiary with eating and meal preparation, bathing, dressing, personal hygiene, and activities of daily living. The service also includes activities such as assistance with meal preparation, bed marking and vacuuming when these activities are essential to the health and welfare of the beneficiary and when no one else is available to perform them . . . . Personal Care Assistance is limited to the amount, duration and scope of the services described in the beneficiaries [sic] support plan and current approved cost plan.[8] (Emphasis added). The support plan indicates that this recipient lived with his mother and three siblings, all but one of whom were capable of completing homemaker tasks. AHCA alleges that of the five claims examined during the audit, one is problematic. In particular, AHCA contends that six of the activities performed on November 12, 2004, constituted unauthorized homemaker tasks, and therefore overbilling occurred in the amount of $12.90. According to AHCA, the unauthorized activities included organizing clothes, cleaning the kitchen, washing dishes, cleaning tables, cleaning the living room, and washing laundry. The undersigned finds that four of the six activities were unauthorized homemaker tasks: organizing clothes, cleaning the living room, washing laundry, and cleaning tables. The undersigned cannot agree, however, that Respondent inappropriately billed for washing dishes and cleaning the kitchen. Notably, and as demonstrated by the service log, meal preparation was one of the services provided to the recipient on November 12, 2004. There is no allegation that meal preparation was unauthorized, and the various exhibits submitted by AHCA plainly reveal that the service was appropriate (i.e., meal preparation was not included in AHCA's list of unauthorized activities for that date). In the undersigned's judgment, if a service provider is authorized to cook a meal for a beneficiary, it necessarily follows that the provider be permitted, and indeed expected, to wash the dishes and clean the kitchen. The undersigned's conclusion that Respondent appropriately billed for cleaning the kitchen and washing dishes is supported by the notes made by Ms. Satchell in one of AHCA's exhibits. In particular, page 3 of Petitioner's Exhibit H indicates that with respect to the October 17, 2004, services provided to Recipient No. 6 (who likewise received Personal Care Assistance), one unit of service was deducted for cleaning the kitchen because there was "no meal prep that day." The obvious implication of this notation is that cleaning the kitchen would not have been considered improper if a meal had been prepared. As Respondent was authorized to prepare a meal for the recipient on November 12, 2004, Respondent properly billed for the services of washing the dishes and cleaning the kitchen. Accordingly, the $12.90 alleged overpayment should be adjusted, as only four unauthorized activities (organizing clothes, cleaning the living room, washing laundry, and cleaning tables) were billed. Recipient No. 3 The service authorization for Recipient No. 3 provided for four hours of Homemaker Services per week. The service authorization further indicated that the Homemaker Services were intended to achieve the support plan goal of providing "the beneficiary with [a] clean environment. General household activities, such meal [sic] preparation, vacuuming, and routine cleaning." It appears from the support plan that the Homemaker Services were authorized due to the poor health of the recipient's mother. Homemaker Services are defined in the Florida Medicaid Developmental Services Waiver Services Coverage and Limitations Handbook as follows: Homemaker services are those general household activities such as meal preparation, laundry, vacuuming and routine household cleaning provided by a trained homemaker, when the person who usually handles these tasks is unable to perform them. The intent of this service is to ensure that the beneficiary's home environment remains clean, safe, and sanitary. Homemaker services are provided only when there is no one else capable of accomplishing the household tasks . . . . * * * Homemaker services shall be provided in the beneficiary's own home or family home. This service is available in the family home only when there is documentation as to why the family cannot provide the support If approved, homemaker services will be limited to the beneficiary's primary living areas such as bedroom and bathroom. This includes the kitchen and a common area, if regularly utilized by the beneficiary. (Emphasis added). On December 11, 2004, Respondent provided four hours of Homemaker Services, which were billed in the amount of $59.20. AHCA concedes that nine of the services provided on December 11, 2004, were authorized and therefore appropriately billed: making the bed; changing the bed sheets; throwing garbage away; cleaning the room; organizing the room; organizing the clothes; cleaning the bathroom; changing the towels; organizing the bathroom; vacuuming; cleaning the rugs; and meal preparation. However, AHCA contends that ten other activities provided on December 11, 2004, were unauthorized: cleaning the kitchen; washing the dishes; cleaning the tables; cleaning / organizing the cabinets; cleaning the stove; cleaning the refrigerator; cleaning the living room; washing laundry; ironing; and cleaning windows. It is evident from Ms. Satchell's notes (in the "MPI worksheet") that she found these tasks unnecessary because they occurred "outside of recipient's bedroom / bathroom."9 As a consequence, Ms. Satchell concluded that Respondent was overpaid for one hour of services in the amount of $14.80 Once again, the undersigned cannot agree that Respondent inappropriately billed for cleaning the kitchen, washing dishes, and cleaning the stove. Cooking was permitted by the service authorization, and there is no allegation that Respondent should not have billed for the meal that was prepared for the recipient on December 11, 2004. If a provider is authorized to prepare a meal, it is only logical that he or she clean up afterward and bill for the time. Nor can the undersigned agree that Respondent should not have billed for cleaning the living room, tables, windows, and refrigerator. These four activities plainly fall within the services contemplated by the service authorization, which directed Respondent to provide "the beneficiary with [a] clean environment" and carry out "general household activities . . . such as routine cleaning." Moreover, these activities are comparable to "cleaning rugs," an activity performed on the same date that was not alleged to be improper. Although, as AHCA point out, these activities may have occurred outside of the recipient's bedroom and bathroom, that fact is not controlling, as the Florida Medicaid Developmental Services Waiver Services Coverage and Limitations Handbook provides that Homemaker Services extend to "the kitchen and a common area, if regularly utilized by the beneficiary."10 The undersigned also finds that washing laundry was not an unauthorized activity, as it falls within the definition homemaker services. Further, in light of the recipient's incontinence, washing laundry is obviously essential to achieving the support plan goal of providing "the beneficiary with [a] clean environment." The undersigned does agree with AHCA that ironing and "cleaning / organizing cabinets" were unauthorized because these activities were not related to the support plan goals. Based on the findings herein that only two of the activities were unauthorized (ironing and "cleaning / organizing" cabinets), an adjustment should be made to the alleged overpayment of $14.80. Recipient No. 6 This recipient was authorized to receive six hours of Personal Care Assistance per day. Pursuant to the support plan, Respondent was authorized to provide bathing, dressing and eating assistance to the recipient. On October 17, 2004, Respondent provided six hours of services to the recipient, at a cost of $120.96. AHCA alleges, correctly, that one of the services provided on that date, cleaning the kitchen, was unauthorized because the service documentation provided by Respondent reflects that no meal was prepared. Accordingly, the undersigned finds that Respondent was overpaid $5.04. Although Respondent has suggested that cleaning the kitchen may have been necessary due to the recipient (who is incontinent) defecating on the kitchen floor, no documentation has been provided that would support such a finding. In the absence of appropriate documentation, AHCA appropriately found that an adjustment of one unit was required for the October 17, 2004, services. Respondent also provided six hours of services to the recipient on November 26, 2004, at a cost of $120.96. With respect to this date, AHCA contends, and the undersigned agrees, that overbilling for one unit in the amount of $5.04 occurred, as one of the activities performed, "organizing clothes," constituted an unauthorized homemaker service. For the reasons expressed above, AHCA demonstrated by a preponderance of the evidence overbilling totaling $10.08 with respect to this recipient. Recipient No. 7 This recipient was authorized to receive Personal Care Assistance. Significantly, the recipient's support plan clearly indicated that her mother prepared meals for her. The service logs indicate that Respondent provided four hours of services to the recipient on the following dates: September 4 and November 25, 2003, and February 10 and April 26, 2004. AHCA contends that on each of the four dates listed above, Respondent provided the unauthorized service of meal preparation, and as a result, Respondent was overpaid a total of $18.68. As the recipient's support plan clearly indicated that meals were prepared by a parent, AHCA has demonstrated an overpayment of $18.68 by a preponderance of the evidence. Recipient No. 8 Recipient No. 8 was authorized to receive Personal Care Assistance and Companion Services, both of which were provided by Respondent. AHCA alleges that of the eleven claims reviewed pursuant to the audit, two were problematic. Specifically, AHCA contends the service logs associated with the personal care assistance provided on October 26 and November 19, 2004, were obvious photocopies of Respondent's service log from March of 2004 for the same recipient. Accordingly, AHCA asserts that the records submitted by Respondent in connection with the October 26 and November 19 services were not contemporaneous and therefore inadequate. As no contemporaneous records document the services provided on October 26 and November 19, 2004, AHCA contends that Respondent was overpaid $275.20 ($137.60 for each of the dates). The undersigned has examined the service logs for October and November 2004 for this recipient and finds that they do not constitute contemporaneous records. As such, Respondent was overpaid in the amount alleged by AHCA. Recipient No. 9 This recipient was authorized to receive Homemaker Services. AHCA alleges, and the undersigned agrees, that of the five claims audited, two involved overpayments. In particular, Respondent's service log reveals that on April 29, 2003, the unauthorized activity of "shopping" was performed. As such, Respondent was overpaid in the amount of $3.70. Further, Respondent's service log indicates that on January 7, 2004, homemaker activities were provided from 9:00 a.m. through 11:00 a.m., which included shopping and meal preparation. As noted above, shopping is an unauthorized activity. In addition, the support plan indicates that the recipient's mother was responsible for preparing meals. Accordingly, an overpayment of $3.70 occurred with respect to this date of service. For these reasons, AHCA has demonstrated a total overpayment of $7.40 in connection with this recipient. Recipient No. 10 Recipient No. 10 was authorized to receive Companion Services, which, pursuant to the support plan, were intended to help the recipient "continue to be exposed to different options in the community." AHCA contends that two of the five claims examined during the audit are problematic. First, with respect to the July 29, 2003, claim, Respondent provided no documentation to support the $49.44 billed for the four hours of service. As such, AHCA correctly determined that Respondent was overpaid in that amount. In addition, AHCA properly found that Respondent was overpaid $3.70 in connection with the September 26, 2003, services. Specifically, the service log indicates that a meal was prepared, which is an activity unrelated to the specific goals identified in the support plan. Based on the above findings, Respondent was overpaid a total of $53.14 with respect to this recipient. Recipient No. 12 Recipient No. 12 was authorized to receive eight hours of Companion Services per week. Pursuant to the support plan and service authorization, the services were intended to help the recipient be "socially active in the community." The support plan further indicated that the recipient was able to "clean her room, clean the bathroom . . . wash dishes and help her mother with chores." AHCA correctly alleges that of the five claims examined, three involved overpayments. First, for the 32 units of service provided on December 28, 2003, Respondent was overpaid $3.70 because the service log indicates that dishwashing was provided. This was obviously inappropriate because, as noted above, the support plan expressly provided that the recipient was capable of washing dishes. Next, Respondent's service log indicates that dishwashing was performed for the recipient on April 24, 2004. As such, Respondent was overpaid $3.70. An overpayment of $3.70 was also proven in connection with the July 3, 2004, services, as the service log demonstrates that the unauthorized activities of dishwashing and "organizing the bathroom" were performed. For these reasons, AHCA appropriately determined that Respondent was overpaid in the total amount of $11.10 for the services provided to this recipient during the audit period. Recipient No. 17 This recipient was authorized to receive Personal Care Assistance and Homemaker Services. Of the twelve claims reviewed concerning this recipient, AHCA alleges that only the November 11, 2004, services are problematic. In particular, a review of the service logs demonstrates that seven activities billed as homemaker services for November 11, 2004, were also provided and billed as personal care assistance for the same date. Based upon this unauthorized duplication of services, AHCA has proven that an overpayment of $14.80 occurred. Recipient No. 18 This recipient was authorized to receive forty hours of Personal Care Assistance per week. According to the support plan, the recipient lived alone with her father (who worked full time) and had little contact with her mother, who lived "far away" and visited only occasionally on weekends. The support plan further provided that the personal care assistance was intended to provide assistance with "bathing, dressing, grooming, food preparation, feeding, and transportation to . . . therapy." AHCA determined, following a review of the service logs and other documentation, that Respondent was overpaid in connection with two of the seven claims reviewed during the audit. First, AHCA alleges that Respondent was overpaid $7.72 by performing unauthorized homemaker tasks on September 19, 2003, which included shopping, washing dishes (although no meal was prepared), and assisting with household activities that would not typically be completed by an eight-year-old child. The undersigned agrees that the activities identified by AHCA in connection with the services rendered on September 19, 2003, were unauthorized, and that Respondent was overpaid in the amount of $7.72. AHCA also contends that Respondent was overpaid $7.72 in connection with the services provided on February 27, 2004. Specifically, AHCA asserts that three of the activities (shopping, laundry, and washing dishes) were unauthorized homemaker tasks. It is critical to note that in contrast to the services provided on September 19, 2003, the provider prepared a meal (as authorized by the support plan) for the recipient on February 27, 2004. As such, and for the reasons expressed previously in this Recommended Order, dishwashing should not be deemed an unauthorized activity. However, the undersigned concludes that shopping and laundry, the other two questionable activities performed on February 27, 2004, were indeed unauthorized. In light of the undersigned's finding that meal preparation was not an unauthorized activity, AHCA should make an appropriate adjustment to the February 27, 2004, overpayment. Recipient No. 19 Of the eight claims examined for Recipient No. 19, who was authorized to receive Companion Services, AHCA found fault with only one. In particular, AHCA determined that of the $59.20 billed on November 26, 2004, Respondent was overpaid $3.70 by performing the unauthorized homemaker activity of "organizing bathroom." The undersigned agrees with AHCA's finding, as organizing the recipient's bathroom is a homemaker activity that does not fall within the ambit of companion services. As such, an overpayment of $3.70 occurred. Recipient No. 20 This recipient was authorized to receive twenty hours of Companion Services per week, which were typically provided in four hour blocks from 1:00 p.m. to 5:00 p.m. Companion Services are defined in the Florida Medicaid Developmental Services Waiver Services Coverage and Limitations Handbook as follows: Companion services consist of non-medical care, supervision, and socialization activities provided to an adult on a one-on- one basis. This service must be provided in direct relation to the achievement of the beneficiary's goals per his or her support plan. A companion provider may also assist the beneficiary with such tasks as meal preparation, laundry and shopping . . . . Providers may also perform light housekeeping tasks, incidental to the care and supervision of the beneficiary. (Emphasis added). Significantly, the support plan expressly provided that the recipient "receive[d] assistance from her companion in some house chores, like cleaning the kitchen and meal preparation to avoid risky situations in the kitchen." (Emphasis added). AHCA contends that overpayments occurred with respect to four of the five claims audited. First, AHCA alleges that with regard to the November 11, 2003, services, Respondent was overpaid $3.70 by performing the unauthorized activity of "light housekeeping." The undersigned cannot agree, as the support plan plainly allowed the provider to assist the recipient with "some house chores," which is indistinguishable from "light housekeeping." Further, and as noted above, companion services may include "light housekeeping tasks, incidental to the care and supervision of the beneficiary." The service log for November 11, 2003, demonstrates that supervision was provided to the recipient. Accordingly, Respondent did not overbill in the amount of $3.70 for this date of service. Next, AHCA contends that with respect to the services provided on December 10, 2003 (which included non-medical care, supervision, shopping, and "goals and support plan assistant"), one activity was unauthorized: meal preparation. As such, AHCA alleges that an overpayment of $3.70 occurred. The undersigned concludes, based on the unambiguous language of the support plan, that meal preparation was authorized. As detailed above, the recipient "receive[d] assistance from her companion in some house chores, like cleaning the kitchen and meal preparation to avoid risky situations in the kitchen." (Emphasis added). Accordingly, an overpayment of $3.70 did not occur with respect to the December 10, 2003, services. Turning to the services provided on May 6, 2004, AHCA contends that the unauthorized activity of washing laundry resulted in an overbilling of $3.70. As referenced in the definition of companion services previously quoted, laundry may only be performed "in direct relation to the achievement of the beneficiary's goals per his or her support plan." In this instance, the documentation submitted by Respondent fails to make such a showing. As a result, AHCA correctly found that $3.70 was overbilled for this date. Finally, with respect to the May 12, 2004, services, AHCA alleges that Respondent was overpaid $3.70 for the unauthorized activity of "dishwashing." The undersigned does not agree that dishwashing was unauthorized, since the support plan contemplated that the recipient would receive assistance from a "companion in some house chores, like cleaning the kitchen." As washing dishes is integral to the process of cleaning a kitchen, Respondent was not overpaid in connection with this date of service. Based on the above findings, the total overbilling for this recipient was $3.70, which related to the May 6, 2004, services. Respondent was not overpaid in connection with the services provided on November 11 and December 10, 2003, and May 12, 2004. Recipient No. 21 This recipient was authorized to receive 20 hours of Personal Care Assistance per week, which was typically provided from 2:00 p.m. through 6:00 p.m. The support plan for this recipient, who is incontinent, reads in relevant part as follows: Food requires modification. Food needs to be blend [sic] or puree [sic] at all times to avoid choking . . . . [Recipient] arrives home around 2:00 p.m. Personal Care service changes her diaper. Then she prepares her a snack. She is [sic] assists with eating. AHCA contends that Respondent was overpaid in connection with three of the four dates of service examined during the audit. First, with respect to the services provided on April 14, 2004, AHCA asserts that two unauthorized activities were performed (organizing clothes and performing a massage), which resulted in overbilling of $3.86. Having reviewed the support plan carefully, the undersigned agrees that these activities were unauthorized and that an overpayment occurred in the amount alleged. Turning to the services provided on October 14, 2004, AHCA alleges that five unauthorized activities (providing a massage, washing dishes, changing sheets, organizing the bathroom, and cleaning a table) resulted in overbilling of $11.58. The undersigned concurs with AHCA's assertion that the activities of "massage," change sheets, organize bathroom, and clean table were unauthorized. However, overbilling did not occur for washing dishes, as the service log reveals that a meal was prepared for the recipient on October 14, 2004, an activity that was expressly authorized by the support plan. As meal preparation was permitted, washing the dishes constituted a permissible activity. In light of the above findings, AHCA should make an appropriate adjustment to the overpayment associated with the October 14, 2004, services. Finally, AHCA contends that with regard to the December 24, 2004, services, Respondent was overpaid $7.72 by providing four unauthorized activities: performing a massage, making the bed, changing towels, and cleaning the living room. The undersigned agrees that these activities were not approved and that an overpayment occurred in the amount alleged. Recipient No. 23 Recipient No. 23 was authorized to receive Personal Care Assistance, which was typically provided multiple times each week for eight hours. AHCA contends that Respondent was overpaid in connection with eight of the nine claims examined during the audit. Six of the claims involve identical issues. In particular, with respect to the services provided on August 29, 2003, and February 2, February 17, April 5, May 28, and September 13, 2004, AHCA asserts that the unauthorized activities of "make bed, meal prep, [and] clean table" resulted in overbilling totaling $60.48 (i.e., $10.08 for each of the six dates). As it appears from a review of the support plan that the recipient's mother was able to complete these activities, the undersigned agrees that overbilling occurred in the amount alleged. AHCA also alleges, and has demonstrated by a preponderance of the evidence, that $10.08 was overbilled in connection with the services provided on August 8, 2003. In particular, the activities of "played outside, played with castle set, and lunch" are beyond the scope of the services contemplated by the support plan. Finally, AHCA has met its burden with respect to the alleged $5.04 in overbilling associated with the September 10, 2003, services, as "went to pool" and "watered deck flowers before dinner" plainly constitute unauthorized activities. Recipient No. 24 As noted previously, Respondent concedes that an overpayment of $0.96 occurred with respect to this recipient. Recipient No. 25 Recipient No. 25 was authorized to receive 16 hours of Companion Services each week to assist with socialization and supervision. Of the six claims examined during the audit, AHCA contends that two are problematic. First, with regard to the services provided on January 29, 2003, AHCA contends that the entire billing for that date ($24.72) should be denied due to inadequate documentation. In particular, AHCA notes that the service log provided during the preliminary audit and final audit was different than a log submitted by Respondent in April of 2009. Further, the earlier log is vague (it merely indicates "assist household, escort activities, other") and fails to address any specific support plan activities. AHCA also points out that the later log was incomplete and failed to indicate the date of the activities. AHCA has demonstrated by a preponderance of the evidence that the services provided on January 29, 2003, were not adequately documented, and therefore Respondent was overpaid in the amount of $24.72. Next, AHCA alleges that the services provided on March 25, 2004, were not adequately documented, and therefore the entire billing of $44.40 should be denied for that date. Specifically, AHCA points out that the service log only reads "supervision" and "escort activities" and failed to address any of the activities enumerated in the support plan. Although a later service log was submitted, it was incomplete, vague, and failed to delineate which activities were performed on March 25, 2004, as opposed to the other nine dates of service during that month. For the reasons detailed above, AHCA demonstrated by a preponderance of the evidence that the March 25, 2004, services were not properly documented, and therefore the $44.40 payment should be denied. Recipient No. 26 AHCA contends that of the nine claims examined during the audit concerning this recipient, one should be fully denied due to the lack of proper documentation. Specifically, AHCA alleges that the $74.00 payment for the services rendered on May 31, 2004, should be denied outright, as the service log for May of 2004 was created by photocopying the service log for the previous month and changing the date. The undersigned has examined the documents11 and concludes that the May 2004 service log was not contemporaneously prepared. As a result, AHCA has demonstrated by a preponderance of the evidence that the $74.00 payment associated with the May 31, 2004, services should be denied. Recipient No. 28 This recipient was authorized to receive Personal Care Assistance to address daily needs such as grooming and dressing. Significantly, the support plan also indicates that meal preparation was authorized. AHCA contends that with respect to the services provided on May 15, 2003, four unauthorized homemaker activities were performed: cleaning the bathroom, washing laundry, cleaning the kitchen, and washing dishes. As a result, AHCA alleges an overpayment of $12.00, which represents four units of service. AHCA has demonstrated by a preponderance of the evidence that cleaning the bathroom and washing laundry were unauthorized. However, AHCA has failed to prove that dishwashing and cleaning the kitchen were unauthorized, as the provider prepared a meal (as indicated by the service log) for the recipient on May 15, 2003, an activity that was authorized by the support plan. As explained previously in this Recommended Order, if a provider is authorized to prepare a meal, then it is entirely reasonable for the provider to wash the dishes and clean the kitchen afterward. This is particularly true with respect to this recipient, who lived alone with her stepfather (who, according to the support plan, worked "intensive hours"), and was incapable of performing basic tasks (e.g., grooming and dressing) without assistance. Accordingly, AHCA should make an appropriate adjustment to the alleged $12.00 overpayment based on the above findings that cleaning the kitchen and washing dishes were not unauthorized. Recipient No. 29 Recipient No. 29 was authorized to receive Personal Care Assistance in the amount of two hours each weekday and five hours on weekends. Pursuant to the support plan, the recipient required assistance with basic activities such as dressing, bathing, brushing teeth, and preparing meals. AHCA contends that overbilling occurred with respect to four of the eight dates of service examined during the audit. First, AHCA alleges, and has demonstrated by a preponderance of the evidence that $10.08 was overbilled for the October 6, 2004, services, as the following unauthorized homemaker activities were performed: cleaning the recipient's room, cleaning the bathroom, organizing the room, organizing the bathroom, and changing towels. In addition, AHCA has proven an overpayment of $10.08 in connection with the November 24, 2004, services, where the service log demonstrates that unauthorized homemaker activities (identical to the services identified in the previous paragraph) were performed on that date. With regard to the services rendered on December 14, 2004, AHCA has demonstrated overbilling of $10.08 for the unauthorized homemaker services of cleaning the room and changing towels. Finally, AHCA alleges, and has demonstrated by a preponderance of the evidence, a $5.04 overpayment in connection with the December 29, 2004, services. In particular, the service logs demonstrate that the unauthorized homemaker activities of vacuuming, organizing the bathroom, and taking out garbage were performed. Recipient No. 31 This recipient was authorized to receive Personal Care Assistance, which was provided eight hours per day, Monday through Friday, and ten hours on both Saturday and Sunday. As the recipient is a quadriplegic, personal care assistance was obviously necessary for feeding and maintaining personal hygiene. Of the nine claims examined during the audit concerning this recipient, AHCA alleges that overbilling occurred with respect to two. First, with regard to the October 27, 2003, services, AHCA contends that insufficient documentation was provided by Respondent to support ten hours of billing. In particular, AHCA asserts that "ate well" is the only activity described in the contemporaneous service log.12 As a result, AHCA argues that one hour of billing should be permitted for meal prep, and that the remaining billing in the amount of $181.44 should be disallowed. Contrary to AHCA's contention, "ate well" is not the only event described in the contemporaneous service log. Significantly, the log also reads, "Incontinent B & B." Given the recipient's physical condition, this notation obviously means that the service provider was required to address at least one episode of bladder and bowel incontinence during the ten hours of service. As such, billing should be permitted for toileting. Based on the above finding that services were documented for toileting, AHCA should make an appropriate adjustment to the October 27, 2003, overpayment. Next, AHCA contends that that due to inadequate documentation, overbilling of $161.28 occurred with regard to the ten hours of services provided on February 16, 2004. In particular, AHCA contends that the documentation submitted by Respondent supports only two hours of billing, as bathing was the only activity described in the contemporaneous service log. Once again, however, the contemporaneous service log also indicates that the service provider was required to address the recipient's bladder and bowel incontinence. Accordingly, additional billing should be permitted for toileting, and AHCA should make an appropriate adjustment to the February 16, 2004, overpayment. Recipient No. 32 Recipient No. 32 was authorized to receive Personal Care Assistance and Companion Services. AHCA contends that Respondent was overpaid in connection with eight of the fifteen claims examined pursuant to the audit. With respect to the services provided on March 21 and 23, 2003, AHCA has demonstrated by a preponderance of the evidence that Respondent was overpaid $61.80 in connection with each of the two dates (totaling $123.60) where the documentation does not support the units of service billed. Next, AHCA contends, and the undersigned agrees, that Respondent inappropriately billed for recreational activities in connection with the personal care assistance services provided on August 13, 2003, and December 1, 2003. As a result, $3.86 was overbilled for each date, for a total of $7.72. AHCA also alleges, and has demonstrated by a preponderance of the evidence, that unauthorized homemaker activities were billed in connection with the companion services rendered on October 7 and 11, 2003, and December 2, 2003, which resulted in overbilling of $11.10, $11.10, and $7.40, respectively. In particular, the service logs indicate that meal prep, laundry, and housekeeping were performed on October 7 and 11, 2003, and that laundry and housekeeping were provided on December 2, 2003. Finally, AHCA has proven an overpayment of $15.44 with respect to the personal care assistance services provided on March 25, 2004. Specifically, the service log indicates that the service provider "walked the dog" and "checked live bait," tasks which do not fall within the scope of personal care assistance. Based on the above findings, AHCA demonstrated a total overpayment of $176.36 with respect to this recipient. Recipient No. 33 This recipient was authorized to receive three hours per week of Companion Services, which were intended to "increase awareness of community resources and increase community integration skills." AHCA alleges that Respondent was overpaid in connection with one of the two claims examined during the audit. Specifically, with respect to the services provided on July 15, 2003, the only activities described in the service log are "shopping" and "exercise." AHCA contends, and the undersigned agrees, that neither shopping nor exercise constitute goal oriented activities in under the circumstances of this recipient. Accordingly, AHCA has demonstrated an overpayment of $15.44, which represents one hour of billing. Recipient No. 34 This recipient was authorized to receive Personal Care Assistance. Pursuant to the support plan, the recipient lived with her able-bodied mother and older brother. Of the five claims examined during the audit, AHCA contends that Respondent was overpaid with respect to two. First, AHCA alleges that $5.29 was overpaid in connection with the August 4, 2004, services, where the service log suggested that the provider took the recipient to the park. The undersigned has examined the monthly summary, and agrees with AHCA's assessment of the documentation. Accordingly, AHCA has demonstrated an overpayment in the amount alleged. Turning to the services provided on December 9, 2004, AHCA has demonstrated an overpayment of $5.29 by a preponderance of the evidence, as "cleaning the living room" is an activity that could have been performed by the recipient's mother.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is Recommended that AHCA: Make appropriate adjustments to the empirical overpayment; Recalculate the probable total overpayment using the adjusted empirical overpayment and the statistical formula previously employed, and enter a final order requiring Respondent to repay AHCA the amount determined through such recalculation; The final order should further require Respondent to pay interest at the rate of 10 percent per annum on the recalculated total overpayment. DONE AND ENTERED this 23rd day of November, 2010, in Tallahassee, Leon County, Florida. S Edward T. Bauer 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 23rd day of November, 2010.
Conclusions Having reviewed the Administrative Complaint, and all other matters of record, the Agency for Health Care Administration finds and concludes as follows: 1. The Agency has jurisdiction over the above-named Respondent pursuant to Chapter 408, Part Il, Florida Statutes, and Chapter 400, Part X, and the applicable authorizing statutes and administrative code provisions. 2. The Agency issued the attached Administrative Complaint and Election of Rights form to the Respondent. (Ex. 1) The parties have since entered into the attached Settlement Agreement, (Ex. 2). Based upon the foregoing, it is ORDERED: 1. The Settlement Agreement is adopted and incorporated by reference into this Final Order. The parties shall comply with the terms of the Settlement Agreement. 2. The facility’s Certificate of Exemption is deemed surrendered and is cancelled and of no further effect. 3. Each party shall bear its own costs and attorney’s fees. Any requests for administrative hearings are dismissed and the above-styled case is closed. 4, In accordance with Florida law, the Respondent is responsible for retaining and appropriately distributing all client records within the timeframes prescribed in the authorizing statutes and applicable administrative code provisions. The Respondent is advised of Section 408.810, Florida Statutes. 5. In accordance with Florida law, the Respondent is responsible for any refunds that may have to be made to the clients. Filed December 24, 2014 3:11 PM Division of Administrative Hearings 6. The Respondent is given notice of Florida law regarding unlicensed activity. The Respondent is advised of Section 408.804 and Section 408.812, Florida Statutes. The Respondent should also consult the applicable authorizing statutes and administrative code provisions. The Respondent is notified that the cancellation of an Agency license may have ramifications potentially affecting accrediting, third party billing including but not limited to the Florida Medicaid program, and private contracts. ORDERED at Tallahassee, Florida, on this 25” day of htaewnboer , 2014. , Secretary th Care Administration NOTICE OF RIGHT TO JUDICIAL REVIEW. A party who is adversely affected by this Final Order is entitled to judicial review, which shall be instituted by filing one copy of a notice of appeal with the Agency Clerk of AHCA, and a second copy, along with filing fee as prescribed by law, with the District Court of Appeal in the appellate district where the Agency maintains its headquarters or where a party resides. Review of proceedings shall be conducted in accordance with the Florida appellate rules. The Notice of Appeal must be filed within 30 days of rendition of the order to be reviewed. CERTIFICATE OF SERVICE I CERTIFY that a true and correct of this Final Order was served on the below-named persons by the method designated on this eis of , 2014. Richard J. Shoop, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Bldg. #3, Mail Stop #3 Tallahassee, Florida 32308-5403 Telephone: (850) 412-3630 Jan Mills Thomas Jones, Unit Manager Facilities Intake Unit Licensure Unit Agency for Health Care Administration Agency for Health Care Administration (Electronic Mail) (Electronic Mail) Katrina Derico-Harris Medicaid Accounts Receivable Agency for Health Care Administration (Electronic Mail) Shawn McCauley Medicaid Contract Management Agency for Health Care Administration (Electronic Mail) Arlene Mayo-Davis, Field Office Manager Local Field Office Agency for Health Care Administration (Electronic Mail) Daniel A. Johnson, Senior Attorney Office of the General Counsel Agency for Health Care Administration (Electronic Mail) Division of Administrative Hearings (Electronic Mail) Dagmar Llaudy, Esquire Law Office of Dagmar Llaudy, P.A. 814 Ponce De Leon Blvd, Suite 513 Coral Gables, Florida 33134 (U.S. Mail) NOTICE OF FLORIDA LAW 408.804 License required; display.-- (1) It is unlawful to provide services that require licensure, or operate or maintain a provider that offers or provides services that require licensure, without first obtaining from the agency a license authorizing the provision of such services or the operation or maintenance of such provider. (2) A license must be displayed in a conspicuous place readily visible to clients who enter at the address that appears on the license and is valid only in the hands of the licensee to whom it is issued and may not be sold, assigned, or otherwise transferred, voluntarily or involuntarily. The license is valid only for the licensee, provider, and location for which the license is issued. 408.812 Unlicensed activity. -- (1) A person or entity may not offer or advertise services that require licensure as defined by this part, authorizing statutes, or applicable rules to the public without obtaining a valid license from the agency. A licenseholder may not advertise or hold out to the public that he or she holds a license for other than that for which he or she actually holds the license. (2) The operation or maintenance of an unlicensed provider or the performance of any services that require licensure without proper licensure is a violation of this part and authorizing statutes. Unlicensed activity constitutes harm that materially affects the health, safety, and welfare of clients. The agency or any state attorney may, in addition to other remedies provided in this part, bring an action for an injunction to restrain such violation, or to enjoin the future operation or maintenance of the unlicensed provider or the performance of any services in violation of this part and authorizing statutes, until compliance with this part, authorizing statutes, and agency rules has been demonstrated to the satisfaction of the agency. (3) It is unlawful for any person or entity to own, operate, or maintain an unlicensed provider. If after receiving notification from the agency, such person or entity fails to cease operation and apply for a license under this part and authorizing statutes, the person or entity shall be subject to penalties as prescribed by authorizing statutes and applicable rules. Each day of continued operation is a separate offense. (4) Any person or entity that fails to cease operation after agency notification may be fined $1,000 for each day of noncompliance. (5) When a controlling interest or licensee has an interest in more than one provider and fails to license a provider rendering services that require licensure, the agency may revoke all licenses and impose actions under s. 408.814 and a fine of $1,000 per day, unless otherwise specified by authorizing statutes, against each licensee until such time as the appropriate license is obtained for the unlicensed operation. (6) In addition to granting injunctive relief pursuant to subsection (2), if the agency determines that a person or entity is operating or maintaining a provider without obtaining a license and determines that a condition exists that poses a threat to the health, safety, or welfare of a client of the provider, the person or entity is subject to the same actions and fines imposed against a licensee as specified in this part, authorizing statutes, and agency rules. (7) Any person aware of the operation of an unlicensed provider must report that provider to the agency.
