The Issue The issue is whether Petitioner received a Medicaid overpayment in the amount of $11,077.65 for claims filed between April 15, 1998, and December 31, 2001.
Findings Of Fact Respondent is the agency responsible for administering the Florida Medicaid Program. One of its duties is to recover Medicaid overpayments from physicians providing care to Medicaid recipients. Petitioner is a licensed chiropractor in the State of Florida. His Medicaid provider number is No. 3801578-00. At all times relevant here, Petitioner provided services to Medicaid patients pursuant to a valid Medicaid provider agreement. Therefore, Respondent was subject to all statutes, rules, and policy guidelines that govern Medicaid providers. Specifically, Petitioner was required to follow the guidelines set forth in the Medicaid Coverage and Limitation Handbook and the Medicaid Reimbursement Handbook. Additionally, Petitioner was required to maintain all "Medicaid-related records" that supported his Medicaid invoices and claims and to furnish those records to Respondent upon request. In 1997 and until April 1998, Petitioner's advertisement in the yellow pages of the Panama City, Florida, telephone book invited the public to make an appointment for a "free spinal exam," which specifically included two X-rays, if medically necessary. The advertisement indicated that Petitioner's office accepted patients with major medical insurance, workers' compensation insurance, and Medicare and Medicaid coverage. The advertisement did not specifically exclude Medicare and Medicaid patients, but specifically stated that the free spinal exam did not include further examination, treatment, or workers' compensation and personal injury cases. However, Petitioner's subsequent advertisements in the telephone book specifically included Medicaid as a type of case that Petitioner excluded from the offer of free services. The original and subsequent advertisements further stated as follows: Our office policy: The patient and any other person responsible for payment has the right to cancel payment, or be reimbursed for payment for any other service, exam, or treatment which is performed as a result of and within 72 hours of responding to the ad for the free service, exam or treatment. ($99.00 value) Respondent's investigator, Julie Canfield-Buddin, saw the advertisement excluding Medicaid patients as recipients of the free services. After confirming that Petitioner was a Medicaid provider, Ms. Canfield-Buddin performed an audit of Petitioner's paid Medicaid claims between April 15, 1998, and December 31, 2001. The audit revealed that Petitioner had not provided the advertised free services to Medicaid patients. In other words, Petitioner had received Medicaid reimbursements for initial office visits and X-rays of new patients who were Medicaid eligible. Petitioner received reimbursements for these services even though Medicaid policy prohibits payments to providers for services that are given to non-Medicaid patients free of charge. In April 2002, Respondent sent Petitioner a preliminary audit report. The preliminary report indicated that for the period beginning April 15, 1998, up to and including December 31, 2001, Petitioner had received $13,522.02 for certain claims that were not covered by Medicaid. The report included a request for Petitioner to send Respondent that amount for the Medicaid overpayment. After receiving the preliminary report, Petitioner's office contacted Ms. Canfield-Buddin, stating that Petitioner had some issues with the denied claims. Ms. Canfield-Buddin responded that Petitioner should state his concerns in writing and furnish Respondent with any additional medical documentation that would serve to reduce the overpayment. Petitioner sent Ms. Canfield-Buddin a letter dated April 25, 2002. Petitioner did not send Respondent any additional medical documentation with the letter to substantiate his position regarding the denied claims. Additionally, Petitioner did not provide Respondent with any written office policy that delineated any difference in the services provided to Medicaid and non-Medicaid patients. In a final audit report dated May 9, 2002, Respondent informed Petitioner that he had been overpaid $13,522.02 for Medicaid claims that, in whole or in part, were not covered by Medicaid. The final audit report included a request for Petitioner to pay that amount for the Medicaid overpayment. Ms. Canfield-Buddin subsequently received a telephone call from Petitioner's office on May 30, 2002. She received Petitioner's written request for a formal administrative hearing on June 3, 2002. After receiving Petitioner's request for a hearing, Ms. Canfield-Buddin reviewed Petitioner's account statements that related to the Medicaid overpayments. Based on that review, Ms. Canfield-Buddin reduced the amount of overpayment to $11,077.65. The revised overpayment reversed denied charges for X-rays of Medicaid patients in excess of the two X-rays that should have been provided free of charge pursuant to the offer for free services. For example, Petitioner was reimbursed for services provided to B.A. on August 10, 2001. These charges included an initial office visit under the Current Procedures Terminology (CPT) code 99203, two X-rays under the CPT code 7240, two X-rays under the CPT code 72072, and two or three X-rays under the CPT code 72100. The final audit denied reimbursement for all charges except the two or three X-rays under CPT code 72100. The revised overpayment reversed the denied charges for two X-rays under the CPT code 72070. The end result was that Respondent denied Petitioner reimbursement only for the initial office visit and two X-rays that ordinarily would have been provided free to non-Medicaid patients. Medicaid allows reimbursement for services equal to the lesser of the Medicaid fee or the provider's usual and customary charge. Petitioner's advertisement offered free services to the public at large with certain exceptions. Petitioner cannot exclude Medicaid patients from that offer by also excluding patients with personal injury or workers' compensation claims. All patients who are not Medicaid eligible are non-Medicaid patients regardless of their payment source. Just because Petitioner excludes free services to non-Medicaid patients with personal injury and workers' compensation claims, does not mean that he can deny those free services to Medicaid patients when his usual and customary practice is to provide the services free to non-Medicaid patients. Some of the denied charges at issue here allegedly involve spinal manipulations that Petitioner claims he performed on Medicaid patients during their initial office visits. Medicaid reimbursement policy requires a spinal manipulation performed during an initial office visit under a 99203 CPT code for a new patient visit to be included as part of the examination conducted during that visit. Medicaid does not allow Petitioner to be separately reimbursed for a spinal manipulation performed on the same day of service as an initial office visit. Petitioner did not include more than two X-rays or any spinal manipulations in his offer of free services for any patient. When a patient has an initial office visit in response to Petitioner's offer of free services, Petitioner first takes the patient's history, performs an examination, and reviews the first two free X-rays. Depending on the results of the evaluation, Petitioner may or may not advise the patient that additional X-rays and/or a spinal manipulation are medically necessary. Petitioner then allows the patient to arrange for payment of those services with his office staff. If the patient is non-Medicaid eligible and is able to pay for services, Petitioner proceeds to take the additional X-rays and/or to perform the spinal manipulation immediately or during a subsequent visit with payment due as arranged. If a non-Medicaid patient requires subsequent examinations during the course of treatment, Petitioner bills the patient or his or her insurance carrier for those services. If the patient is Medicaid eligible, Petitioner may either proceed with taking the X-rays and/or performing the spinal examination immediately, knowing that he will not be separately reimbursed for the spinal manipulation, or make an appointment for the Medicaid patient to return on another day so that he can be reimbursed for the spinal manipulation. In any event, Medicaid regulations do not allow reimbursement for further examinations within a three-year period. During the hearing, Petitioner testified that some of the denied charges for initial office visits under the CPT code 99203 included spinal manipulations that he never intended to be free and that he did not provide spinal manipulations as a free service to non-Medicaid patients. Petitioner's testimony in this regard is not credited for two reasons. First, he did not produce any medical documentation to support his testimony as to any Medicaid patient receiving a spinal manipulation during an initial office visit. Second, he did not identify any such patient during his testimony. Respondent performs Medicaid audits after a provider renders services. Therefore, it is essential for providers like Petitioner, who contest denied claims, to be able to substantiate their billing with appropriate documentation. Such documentation must be created at the time of service, maintained pursuant to statutory and rule requirements, and furnished to Respondent upon request. Petitioner never responded to Ms. Canfield-Buddin's request for medical documentation to substantiate Petitioner's challenge to the denied claims. Additionally, Petitioner testified that the services he performed for some Medicaid patients were not equivalent to the free services he performed for non-Medicaid patients because they often involved a higher level of service, including additional services, tests, or examinations. According to Petitioner, some of the Medicaid patients required more extensive screening and counseling that consumed more of Petitioner's time. Despite this testimony, Petitioner admitted that the histories he took of Medicaid patients and non-Medicaid patients were basically the same. Petitioner testified that the difference in the level of service provided to all patients varied based upon the individual patients and did not depend on whether they were or were not Medicaid patients. He had no written or unwritten guidelines or policies that limited the scope of screening or level of service in an initial office visit for either type of patient. Petitioner's testimony that the level of services provided to Medicaid patients differed from the level of services offered to non-Medicaid patients is not persuasive. Once again, Petitioner failed to provide the required medical documentation to support his testimony or to identify in his testimony Medicaid patients who required a higher level of service. Moreover, Petitioner knew, when he made his offer of free services, that he would not be able to claim reimbursement for services provided to Medicaid patients that were not separately reimbursable even if Petitioner was entitled to exclude Medicaid patients from the offer. This includes cases where a Medicaid patient may have required a high level of service in terms of the time expended during the screening or a spinal manipulation during the initial office visit. Petitioner provides free services to members of his family. The provision of free services to family does not establish that Petitioner had a usual and customary practice of providing free services. At times, Petitioner treats police officers and indigent persons free of charge. However, Petitioner does not publicly advertise that he treats these patients free of charge because he does not want to be overrun with people taking advantage of the offer. There is no persuasive evidence that Petitioner routinely treats police officers covered by private health insurance and indigent patients covered by Medicaid free of charge. Therefore, it cannot be said that Petitioner's usual and customary practice is to furnish services to these patients free of charge. A Medicaid provider is allowed to use the CPT code 99203 for a new patient visit once per recipient every three years. Petitioner's offer of free services for non-Medicaid patients allows them one free office visit and two free X-rays regardless of the passage of time. According to Petitioner, this means that Respondent's interpretation of Medicare regulations would entitle a Medicaid patient to the free services every three years whereas a non-Medicaid patient would not be so entitled, showing yet another difference in the services provided to Medicaid and non-Medicaid patients under the offer of free services. However, Petitioner's testimony in this regard is not persuasive because it is not based on medical documentation or testimony showing that Petitioner ever treated a Medicaid patient as a new patient more than once.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That Respondent enter a final order determining that Petitioner owes $11,077.65 for Medicaid reimbursement overpayments. DONE AND ENTERED this 18th day of November, 2002, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 18th day of November, 2002. COPIES FURNISHED: Anthony L. Conticello, Esquire Grant P. Dearborn, Esquire Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308-5403 Hal Cowen ChiroNetwork Health Care Centers 127 West 23rd Panama City, Florida 32405 Lealand McCharen, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 Valda Clark Christian, General Counsel Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building, Suite 3431 Tallahassee, Florida 32308
Conclusions THE PARTIES resolved all disputed issues and executed a Settlement Agreement. The parties are directed to comply with the terms of the attached settlement agreement. Based on the foregoing, this file is CLOSED. DONE and ORDERED on this the" day of le , 2013, in Tallahassee, Leon County, Florida. ‘LM, fo: ABETH DUDEK, SECRETA “Agency for Health Care Administration 1 Filed May 8, 2013 11:26 AM Division of Administrative Hearings A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO A 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 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. Copies furnished to: Mario Rub, M.D. Pediatric Pulmonologist 20776 W. Dixie Highway Aventura, Florida 33180 (Via U.S. Mail) Errol H. Powell Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 Willis F. Melvin Assistant General Counsel Agency for Health Care Administration Office of the General Counsel (Via Electronic Mail) Ken Yon, Acting Bureau Chief, Medicaid Program Integrity Finance and Accounting Health Quality Assurance (via email) DOH (via email) License number ME69331 CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished to the above named addressees by U.S. Mail, Laserfiche or electronic mail on this the 5 day of By » 2013. —) Richard Shoop, Esqu: Agency Clerk State of Florida Agency for Health Care Administration 2727 Mahan Drive, MS #3 Tallahassee, Florida 32308-5403 (850) 412-3630/FAX (850) 921-0158 ire STATE OF FLORIDA AGENCY FOR HEALTH CARE ADMINISTRATION STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Petitioner, vs. DOAH Case No.: 13-0129MPI AHCA CLI. No.: 12-1694-000 MARIO RUB, M.D., Respondent. / SETTLEMENT AGREEMENT STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION (“AHCA” or “the Agency”), and MARIO RUB, M.D. (“PROVIDER”), by and through the undersigned, hereby stipulates and agrees as follows: 1. This Agreement is entered into for the purpose of memorializing the final resolution of the matters set forth in this Agreement. 2. PROVIDER is a Medicaid provider (Medicaid Provider No. 256291000) and was a provider during the audit period, September 1, 2008 to February 28, 2011. 3. In its final audit report (FAR) dated November 13, 2012 for the case referenced as C.I. No. 12-1694-000, AHCA notified PROVIDER that review of Medicaid claims performed by Medicaid Program Integrity (MPI) indicated that, in its opinion, some claims in whole or in part had been inappropriately paid. The Agency sought recoupment of this overpayment in the amount of $14,039.92. In response to the FAR, PROVIDER filed a petition for a formal administrative hearing. It was assigned DOAH Case No. 13-0129MPI. 4. Subsequent to the original audit, and in preparation for trial, AHCA re-reviewed the PROVIDER’s claims and evaluated additional documentation submitted by the PROVIDER. As a result of the additional review, AHCA determined the overpayment should be adjusted to $5,752.06 plus $1,154.41 in fines and $1,659.66 in costs for a total due of $8,566.13. 5. In order to resolve this matter without further administrative proceedings, PROVIDER and the AHCA expressly agree as follows: (1) AHCA agrees to accept the payment set forth herein in settlement of the overpayment issues arising from the captioned audit. (2) The amount in dispute that is now being resolved is five thousand seven hundred fifty-two dollars and six cents ($5,752.06) on the indebtedness, one thousand one hundred fifty-four dollars and forty-one cents ($1,154.41) in fines, plus one thousand six hundred fifty-nine dollars and sixty-six cents ($1,659.66) in investigative costs for a total of eight thousand five hundred sixty-six dollars and thirteen cents ($8,566.13). PROVIDER will make an initial payment of one thousand seven hundred thirteen dollars and twenty-three cents ($1,713.23) followed by eleven (11) monthly payments of six hundred two dollars and forty- eight cents ($602.48) and one final payment of six hundred two dollars and forty- six cents ($602.46). The first payment will be due beginning thirty (30) days after the Final Order date. This amount due will be offset by any amount already received by the Agency in this matter. Furthermore, PROVIDER is advised that pursuant to Section 409.913, Florida Statutes, failure to pay in full, or enter into and abide by the terms of any repayment schedule set forth by the Agency may result in termination from the Medicaid program, withholding of future Medicaid payments, or other such remedies as provided by law. Any outstanding balance accrues at 10% interest per year. Full payment will fully and completely settle all claims in these proceedings before the Division of Administrative Hearings (DOAH Case No. 13-0129MPI). Should the provider’s enrollment with Medicaid be terminated, the full amount owed will be due within 30 days of termination. (3) In the event any interim payments are received or withheld, by whatever means, prior to the entry of the Final Order, Medicaid Accounts Receivable shall make the adjustment to credit such amounts, dollar for dollar, as quickly as is practicable. (4) Compliance with this repayment agreement fully and completely settles all claims in these proceedings before the Division of Administrative Hearings (DOAH Case No. 13-0129MPI). Should the provider’s enrollment with Medicaid be terminated, the full amount owed will be due within 30 days of termination. (5) PROVIDER and AHCA agree that full payment, as set forth above, resolves and settles this case completely. It will release both parties from any administrative or civil liabilities or claims arising from the findings in audit C.I. 12-1694-000. (6) PROVIDER agrees that it will not rebill the Medicaid Program in any manner for claims that were not covered by Medicaid, which are the subject of the audit in this case. 6. Questions regarding procedures for submitting payment should be directed to Medicaid Accounts Receivable, (850) 412-3901. The C.J. number listed on the first page of this agreement must be legibly entered on the check to assure proper credit. Please mail payment to: AGENCY FOR HEALTHCARE ADMINISTRATION Medicaid Accounts Receivable — MS # 14 2727 Mahan Drive, Bldg. 2, Suite 200 Tallahassee, Florida 32308 7. PROVIDER agrees that failure to pay any monies due and owing under the terms of this Agreement shall constitute PROVIDER’S authorization for the Agency, without further notice, to withhold the total remaining amount due under the terms of this agreement from any monies due and owing to PROVIDER for any Medicaid claims. 8. AHCA reserves the right to enforce this Agreement under the laws of the State of Florida, the Rules of the Medicaid Program, and all other applicable rules and regulations. 9. This settlement does not constitute an admission of wrongdoing or error by either party with respect to this case or any other matter. 10. Each party shall bear its own attorneys’ fees and costs, with the exception that the Respondent shall reimburse, as part of this settlement, $1,659.66 in Agency costs and $1,154.41 in fines. This amount is included in the calculations and demand of paragraph 5(2). 11. The signatories to this Agreement, acting in a representative capacity, represent that they are duly authorized to enter into this Agreement on behalf of the respective parties. 12. | This Agreement shall be construed in accordance with the provisions of the laws of Florida. Venue for any action arising from this Agreement shall be in Leon County, Florida. 13. This Agreement constitutes the entire agreement between PROVIDER and AHCA, including anyone acting for, associated with or employed by them, concerning all matters and supersedes any prior discussions, agreements or understandings; there are no promises, representations or agreements between PROVIDER and the AHCA other than as set forth herein. No modification or waiver of any provision shall be valid unless a written amendment to the Agreement is completed and properly executed by the parties. 14. This is an Agreement of settlement and compromise, made in recognition that the parties may have different or incorrect understandings, information and contentions, as to facts and law, and with each party compromising and settling any potential correctness or 4 incorrectness of its understandings, information and contentions as to facts and law, so that no misunderstanding or misinformation shall be a ground for rescission hereof. 15. PROVIDER expressly waives in this matter its right to any hearing pursuant to sections 120.569 or 120.57, Florida Statutes, the making of findings of fact and conclusions of law by the Agency, and all further and other proceedings to which it may be entitled by law or rules of the Agency regarding this proceeding and any and all issues raised herein. PROVIDER further agrees that it shall not challenge or contest any Final Order entered in this matter which is consistent with the terms of this settlement agreement in any forum now or in the future available to it, including the right to any administrative proceeding, circuit or federal court action or any appeal. 16. | This Agreement is and shall be deemed jointly drafted and written by all parties to it and shall not be construed or interpreted against the party originating or preparing it. 17. To the extent that any provision of this Agreement is prohibited by law for any reason, such provision shall be effective to the extent not so prohibited, and such prohibition shall not affect any other provision of this Agreement. 18. This Agreement shall inure to the benefit of and be binding on each party’s successors, assigns, heirs, administrators, representatives and trustees. 19. All times stated herein are of the essence of this Agreement. THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK MARIO RUB, M.D. Printed Representativé$ Name BY. Nacio buh, 305 0060381 DEA BR 4969664 20776 W. DDGE HWY. AVENTURA, FL 33180 (905) 931-1812 + FAX (305) 931-1632 FLORIDA AGENCY FOR HEALTH CARE ADMINISTRATION 2727 Mahan Drive, Mail Stop #3 Tallahassee, Florida 32308-5403 Wl « CC mMmActeR General Counsel Aoegack dll Chief Medicaid Counsel hy. Willis F. Melvin, Jr. Assistant General Counsel Dated: Dated: Dated: Dated: Dated: 2| \3 , 2013 S/3 ,2013 r// 2 ,2013 3 5 2013 Februany LF ,2013 RICK SCOTT FLORIDA AGENCY FOR HEALTH CARE ADMINISTRATION GOVERNOR Better Health Care for all Floridians CERTIFIED MAIL No.:7009 2820 0001 5671 9368 November 13, 2012 Provider No: 2562910-00 NPI No: 1790889996 License No.:ME69331 Mario Rub, M.D. 20776 West Dixie Highway North Miami Beach, Florida 33180 In Reply Refer to FINAL AUDIT REPORT C.L: No. 12-1694-000 Dear Provider: ELIZABETH DUDEK SECRETARY The Agency for Health Care Administration (Agency), Office of Inspector General, Bureau of Medicaid Program Integrity, has completed a review of claims for Medicaid reimbursement for dates of service during the period September 1, 2008, through February 28, 2011. A preliminary audit report dated July 16, 2012, was sent to you indicating that we had determined you were overpaid $279,132.60. Based upon a review of all documentation submitted, we have determined that you were overpaid $14,039.92 for services that in whole or in part are not covered by Medicaid. A fine of $2,807.98 has been applied. The cost assessed for this audit is $1,359.66. The total amount due is $18,207.56. Be advised of the following: (1) In accordance with Sections 409.913(15), (16), and (17), Florida Statutes (F.S.), and Rule 59G- 9.070, Florida Administrative Code (F.A.C.), the Agency shall apply sanctions for violations of federal and state laws, including Medicaid policy. This letter shall serve as notice of the following sanction(s): e A fine of $2,807.98 for violation(s) of Rule Section 59G-9.070(7) (e), F.A.C. (2) Pursuant to Section 409.913(23) (a), F.S., the Agency is entitled to recover all investigative, legal, and expert witness costs. 2727 Mahan Drive, MS# 6 Tallahassee, Florida 32308 Visit AHCA online at http://ahca.myflorida.com Mario Rub, M.D. Provider ID: 2562910-00 CI. No.:12-1694-000 Page 2 This review and the determination of overpayment were made in accordance with the provisions of Section 409.913, F.S. In determining the appropriateness of Medicaid payment pursuant to Medicaid policy, the Medicaid program utilizes procedure codes, descriptions, policies, limitations and requirements found in the Medicaid provider handbooks and Section 409.913, F.S. In applying for Medicaid reimbursement, providers are required to follow the guidelines set forth in the applicable rules and Medicaid fee schedules, as promulgated in the Medicaid policy handbooks, billing bulletins, and the Medicaid provider agreement. Medicaid cannot pay for services that do not meet these guidelines. Below is a discussion of the particular guidelines related to the review of your claims, and an explanation of why these claims do not meet Medicaid requirements. The audit work papers are attached, listing the claims that are affected by this determination. REVIEW DETERMINATION(S) Medicaid policy defines the varying levels of care and expertise required for the evaluation and management procedure codes for office visits. The documentation you provided supports a lower level of office visit than the one for which you billed and received payment. This determination was made by a peer consultant in accordance with Sections 409.913 and 409.9131, F.S. The difference between the amount you were paid and the correct payment for the appropriate level of service is considered an overpayment. Medicaid policy requires that services performed be medically necessary for the diagnosis and treatment ofan illness. You billed and received payments for services for which the medical records, when reviewed by a Medicaid physician consultant, were insufficient to justify billing for code indicated. The documentation failed to meet the Medicaid criteria for medical necessity. The claims were either disallowed or adjusted by the peer to reflect service documented. OVERPAYMENT CALCULATION A random sample of 35 recipients respecting whom you submitted 173 claims was reviewed. For those claims in the sample, which have dates of service from September 1, 2008, through February 28, 2011, an overpayment of $846.51 or $4.89312139 per claim, was found. Since you were paid for a total (population) of 3,994 claims for that period, the point estimate of the total overpayment is 3,994 x 4,89312139 = $19,543.13. There is a 50 percent probability that the overpayment to you is that amount or more. We used the following statistical formula for cluster sampling to calculate the amount due the Agency: E- oe) ses 4 - -YB,y Where: N N E = point estimate of overpayment = SA, > B | Mario Rub, M.D. Provider ID: 2562910-00 CI. No.:12-1694-000 Page 3 U F = number of claims in the population = s B is] A, = total overpayment in sample cluster B, = number of claims in sample cluster U =number of clusters in the population N = number of clusters in the random sample N N Y = mean overpayment per claim = > A, > B, i=] j= t = t value from the Distribution of ¢ Table All of the claims relating to a recipient represent a cluster. The values of overpayment and number of claims for each recipient in the sample are shown on the attachment entitled “Overpayment Calculation Using Cluster Sampling.” From this statistical formula, which is generally accepted for this purpose, we have calculated that the overpayment to you is $14,039.92, with a ninety-five percent (95%) probability that it is that amount or more. If you are currently involved in a bankruptcy, you should notify your attorney immediately and provide a copy of this letter for them. Please advise your attorney that we need the following information immediately: (1) the date of filing of the bankruptcy petition; (2) the case number; (3) the court name and the division in which the petition was filed (e.g., Northern District of Florida, Tallahassee Division); and, (4) the name, address, and telephone number of your attorney. If you are not in bankruptcy and you concur with our findings, remit by certified check in the amount of $18,207.56, which includes the overpayment amount as well as any fines imposed and assessed costs. The check must be payable to the Florida Agency for Health Care Administration. Questions regarding procedures for submitting payment should be directed to Medicaid Accounts Receivable, (850) 412-3901. To ensure proper credit, be certain you legibly record on your check your Medicaid provider number and the C.J. number listed on the first page of this audit report. Please mail payment to: Medicaid Accounts Receivable - MS # 14 Agency for Health Care Administration 2727 Mahan Drive Bldg. 2, Ste. 200 Tallahassee, FL 32308 Pursuant to section 409.913(25)(d), F.S., the Agency may collect money owed by all means allowable by law, including, but not limited to, exercising the option to collect money from Medicare that is payable to the provider. Pursuant to section 409.913(27), F.S., if within 30 days following this notice you have not either repaid the alleged overpayment amount or entered into a satisfactory repayment agreement with the Agency, your Medicaid reimbursements will be withheld; they will continue to be withheld, even during the pendency of an administrative hearing, until such time as the overpayment amount is satisfied. Pursuant to section 409.913(30), F.S., the Agency shall terminate your participation in the Medicaid program if you fail to repay an overpayment or enter into a satisfactory repayment agreement with the Agency, within 35 days after the date of a final order which is no longer subject to further appeal. Pursuant to sections 409.913(15)(q) and 409.913(25)(c), F.S., a provider that does not adhere to the terms of a repayment agreement is subject to termination from the Medicaid program. Mario Rub, M.D. Provider ID: 2562910-00 C.J. No.:12-1694-000 Page 4 Finally, failure to comply with all sanctions applied or due dates may result in additional sanctions being imposed. You have the right to request a formal or informal hearing pursuant to Section 120.569, F.S. Ifa request for a formal hearing is made, the petition must be made in compliance with Section 28-106.201, F.A.C. and mediation may be available. If a request for an informal hearing is made, the petition must be made in compliance with rule Section 28-106.301, F.A.C. Additionally, you are hereby informed that ifa request for a hearing is made, the petition must be received by the Agency within twenty-one (21) days of receipt of this letter. For more information regarding your hearing and mediation rights, please see the attached Notice of Administrative Hearing and Mediation Rights. Any questions you may have about this matter should be directed to: : Jennifer Ellingsen, Investigator, Agency for Health Care Administration, Office of Inspector General, Medicaid Program Integrity, 2727 Mahan Drive, Mail Stop #6, Tallahassee, Florida 32308-5403, telephone (850) 412- 4600, facsimile (850) 410-1972. Sincerely, Se Be Fred Becknell AHCA Administrator Office of Inspector General Medicaid Program Integrity FB/jse Enclosure(s) Copies furnished to: Finance & Accounting (Interoffice mail) Health Quality Assurance (E-mail) Department of Health (E-mail) Mario Rub, M.D. Provider ID: 2562910-00 C.J. No.:12-1694-000 Page 5 NOTICE OF ADMINISTRATIVE HEARING AND MEDIATION RIGHTS You have the right to request an administrative hearing pursuant to Sections 120.569 and 120.57, Florida Statutes. If you disagree with the facts stated in the foregoing Final Audit Report (hereinafter FAR), you may request a formal administrative hearing pursuant to Section 120.57(1), Florida Statutes. If you do not dispute the facts stated in the FAR, but believe there are additional reasons to grant the relief you seek, you may request an informal administrative hearing pursuant to Section 120.57(2), Florida Statutes. Additionally, pursuant to Section 120.573, Florida Statutes, mediation may be available if you have chosen a formal administrative hearing, as discussed more fully below. The written request for an administrative hearing must conform to the requirements of either Rule 28- 106.201(2) or Rule 28-106.301(2), Florida Administrative Code, and must be received by the Agency for Health Care Administration, by 5:00 P.M. no later than 21 days after you received the FAR. The address for filing the written request for an administrative hearing is: Richard J. Shoop, Esquire Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop #3 Tallahassee, Florida 32308 Fax: (850) 921-0158 Phone: (850) 412-3630 The request must be legible, on 8 % by 11-inch white paper, and contain: 1. Your name, address, telephone number, any Agency identifying number on the FAR, if known, and name, address, and telephone number of your representative, if any; 2. An explanation of how your substantial interests will be affected by the action described in the FAR; 3. A statement of when and how you received the FAR; 4. Fora request for formal hearing, a statement of all disputed issues of material fact; 5. Fora request for formal hearing, a concise statement of the ultimate facts alleged, as well as the rules and statutes which entitle you to relief; 6. Fora request for formal hearing, whether you request mediation, if it is available; 7. For a request for informal hearing, what bases support an adjustment to the amount owed to the Agency; and 8. A demand for relief. A formal hearing will be held if there are disputed issues of material fact. Additionally, mediation may be available in conjunction with a formal hearing. Mediation is a way to use a neutral third party to assist the parties in a legal or administrative proceeding to reach a settlement of their case. If you and the Agency agree to mediation, it does not mean that you give up the right to a hearing. Rather, you and the Agency will try to settle your case first with mediation. If you request mediation, and the Agency agrees to it, you will be contacted by the Agency to set up a time for the mediation and to enter into a mediation agreement. If a mediation agreement is not reached within 10 days following the request for mediation, the matter will proceed without mediation. The mediation must be concluded within 60 days of having entered into the agreement, unless you and the Agency agree to a different time period. The mediation agreement between you and the Agency will include provisions for selecting the mediator, the allocation of costs and fees associated with the mediation, and the confidentiality of discussions and documents involved in the mediation. Mediators charge hourly fees that must be shared equally by you and the Agency. If a written request for an administrative hearing is not timely received you will have waived your right to have the intended action reviewed pursuant to Chapter 120, Florida Statutes, and the action set forth in the FAR shall be conclusive and final. FLORIDA AGENCY FOR HEALTH CARE ADMINISTRATION Provider: 256291000 - MARIO RUB Overpayment Calculation Using Cluster Sampling by Recip Name Dates Of Service: 9/1/2008 through 2/28/2011 Number of recipients in population: Number of recipients in sample: Total payments in population: No. of claims in population: Totals: Using Overpayment per claim method Overpayment per sample claim: Point estimate of the overpayment: Variance of the overpayment: Standard error of the overpayment: Half confidence interval: Overpayment at the 95 % Confidence level: Overpayment run on 11/9/2012 COON ADH RWHNA 600 35 $1,083,860.97 3,994 $4.89312139 $19,543.13 $10,592,145.98 $3,254.56 $5,503.21 $14,039.92 33 FP NN FB HOMER ANNA aNWaAn = =a nN 173 Case ID: Confidence level: t value: $228.96 $145.15 $281.20 $121.92 $153.25 $68.64 $747.83 $228.96 $121.92 $168.96 $28,469.80 $76.70 $87.60 $236.70 $2,803.99 $229.95 $297.69 $171.41 $87.60 $129.39 $259.20 $3,257.45 $234.17 $87.60 $251.87 $75.97 $57.55 $34.32 $693.77 $87.60 $173.92 $87.60 $20,625.31 $121.92 $75.97 $60,981.84 Page 4 of 4 NPI: 1790889996 12-1694-000 95 % 1.690924 $0.00 $0.00 $117.70 $0.00 $0.00 $52.55 $194.73 $0.00 $0.00 $0.00 $126.76 $19.16 $0.00 $38.32 $0.00 $0.00 $38.30 $0.00 $0.00 $41.79 $54.28 $0.00 $68.75 $0.00 $0.00 $0.00 $0.00 $0.00 $94.17 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $846.51 Page 1 of 1) ( | SENDER: COMPLETE THIS SECTION ® Complete Items 1, 2, and 3. Also complete Htam 4 If Reatricted Delivery Is desired, @ Print your name and address on the reverse 80 that we can return the card to you. ® Attach this card to the back of the malipisce, ot aathn dront. Ihsvares. rete pew ™ Attach this card to the back of the mallplece, or on the front If space permits, 1. Article Addressed to: &. Hecwived by ( Printed Name) D. Is delivary address different from item 17 1 Yes IC YES, enter delivery address below: = No Mario Rub, M.D. '" 20776 West Dixie Highwa: . 'y 3. Service Type North Miami Beach, Florida 33180 Centtied Mat ©) Express Mail Cl. # 12+1694-000 JE-re Ci Regletered —-C) Return Recelpt for Merchandlee - D Insured Mall = 6.0.0, 4, Restricted Delivery? (Exira Fea) ves 2, Article Number Ganetertiomsoriceteboy 008 EBe0 OOOL Sb?) 53b8 PS Form 3811, February 2004 Domestic Return Recelpt 102595-02-M-1640 ; UniTeD States Postac SERVICE | } | | FI LORIDA AGENCY Fon SEAR CORE 2727 Mahan Dri ve, MS #6 Tallahassee Florid; Medical Unit 052308 Falbssh locas dasbaldadaElbasbeadashatbnllaht i i { { i ' ‘ i Englion Customer Service &4aUSPSCOM Quick Tools Track & Confirm YOUR LABEL NUMBER | 7o097820000188719388 i Check on Another Item What's your label (or receipt) number? LEGAL Privacy Policy » Terms of Use > FOIA> No FEAR Act EEO Oata > OTHER USPS SITES. ‘Business Custamar Gataway > Postal inspectors » Inspector General » Postal Explorer > Copyright® 2012 USPS. AN Rights Raservad. USPS Mobile Ship a Package Send Mail SERVICE STATUS OF YOURITEM i Detivered ; ON USPS.COM Government Sarvices » Buy Stamps & Shop > Print a Label with Postage > Customer Service > Site Index > Register / Signin Search USPS.com or Track Packages Manage Your Mail Shop Business Solutions DATE & TIME LOCATION FEATURES. ' November 49, 2012,3:26 pm’ MIAMI, FL 33480, | Certified Mait = ‘ON ABOUT.USPS.COM About USPS Homie + Newstoom > Mail Service Updates » Forms & Publications » Careers >
The Issue Whether Medicaid overpayments were made to Petitioner by the Agency for Health Care Administration ("AHCA") for services performed during the audit period of December 4, 1996 to December 4, 1998, and, if so, what is the total amount of these overpayments.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: Parties Petitioner is a licensed physician in the State of Florida, having been issued license number 29615. His specialty area of practice is general or family practice. His office is located in Brandon, Florida. AHCA is the agency responsible for administering the Florida Medicaid Program. One of AHCA's duties is to recover Medicaid overpayments from physicians providing care to Medicaid recipients. Section 409.9131, Florida Statutes. The Provider Agreement During the audit period, Petitioner was authorized to provide physician services to eligible Medicaid patients. Petitioner provided such services pursuant to Medicaid Provider Agreements he entered into with AHCA and its predecessor, the Department of Health and Rehabilitative Services, on November 27, 1992, and December 3, 1996. The 1996 Provider Agreement, in effect at the time of the audit, contained the following provisions, among others: Quality of Service. The provider agrees to provide medically necessary services or goods of not less than the scope and quality it provides to the general public. The provider agrees that services or goods billed to the Medicaid program must be medically necessary, of a quality comparable to those furnished by the provider's peers, and within the parameters permitted by the provider's license or certification. The provider further agrees to bill only for the services performed within the specialty or specialties designated in the provider application on file with the Agency. The services or goods must have been actually provided to eligible Medicaid recipients by the provider prior to submitting the claim. Compliance. The provider agrees to comply with all local, state and federal laws, rules, regulations, licensure laws, Medicaid bulletins, manuals, handbooks and Statements of Policy as they may be amended from time to time. * * * 5. Provider Responsibilities. The Medicaid provider shall: * * * (b) Keep and maintain in a systematic and orderly manner all medical and Medicaid related records as the Agency may require and as it determines necessary; make available for state and federal audits for five years, complete and accurate medical, business, and fiscal records that fully justify and disclose the extent of the goods and services rendered and billings made under the Medicaid [sic]. The provider agrees that only records made at the time the goods and services were provided will be admissible in evidence in any proceeding relating to the Medicaid program. * * * (d) Except as otherwise provided by law, the provider agrees to provide immediate access to authorized persons (including but not limited to state and federal employees, auditors and investigators) to all Medicaid- related information, which may be in the form of records, logs, documents, or computer files, and all other information pertaining to services or goods billed to the Medicaid program. This shall include access to all patient records and other provider information if the provider cannot easily separate records for Medicaid patients from other records. * * * (f) Within 90 days of receipt, refund any moneys received in error or in excess of the amount to which the provider is entitled from the Medicaid program. Handbook Provisions Among the "manuals and handbooks" referenced in paragraph 3 of the Provider Agreement in effect during the audit period were the Medicaid Provider Reimbursement Handbook, HFCA- 1500 ("Reimbursement Handbook") and the Physician Coverage and Limitations Handbook ("C&L Handbook"), with their periodic updates. The term "medically necessary" was defined in Appendix D of the Reimbursement Handbook as follows, in relevant part: Medically Necessary or Medical Necessity Means that the medical or allied care, goods, or services furnished or ordered must: (a) Meet the following conditions: Be necessary to protect life, to prevent significant illness or significant disability, or to alleviate severe pain; Be individualized specific, and consistent with symptoms or confirmed diagnosis of the illness or injury under treatment, and not in excess of the patient's needs; Be consistent with generally accepted professional medical standards as determined by the Medicaid program, and not experimental or investigational; Be reflective of the level of service that can be safely furnished, and for which no equally effective and more conservative or less costly treatment is available statewide; and Be furnished in a manner not primarily intended for the convenience of the recipient, the recipient's caretaker, or the provider. . . . Chapter 3 of the C&L Handbook sets forth procedure codes to be used by physicians in claiming reimbursement for services provided to Medicaid recipients. The origin of the procedural and diagnosis codes is as follows, in relevant part: The procedure codes listed in this chapter are Health Care Financing Administration Common Procedure Coding System (HCPCS) Levels 1, 2, and 3. These are based on the Physician's Current Procedural Terminology (CPT) book. The CPT includes HCPCS descriptive terms and numeric identifying codes and modifiers for reporting services and procedures. . . . The CPT book is a systematic listing and coding of procedures and services provided by physicians. Each procedure or service is identified with a five digit code. For purposes of this proceeding, the relevant section of the CPT book is "Evaluation and Management-- Office or Other Outpatient Services," which sets forth the codes used to report evaluation and management services provided in the physician's office or in an outpatient or other ambulatory facility. The CPT book sets forth instructions for selecting the proper level of Evaluation and Management ("E/M") service, as follows in relevant part: Review the Level of E/M Service Descriptors and Examples in the Selected Category or Subcategory The descriptors for the levels of E/M services recognize seven components, six of which are used in defining the levels of E/M services. These components are: history; examination; medical decision making; counseling; coordination of care; nature of presenting problem; and time. The first three of these components (i.e., history, examination, and medical decision making) should be considered the key components in selecting the level of E/M services. . . . Determine the Extent of History Obtained The extent of the history is dependent upon clinical judgment and on the nature of the presenting problem(s). The levels of E/M services recognize four types of history that are defined as follows: Problem focused: chief complaint; brief history of present illness or problem. Expanded problem focused: chief complaint; brief history of present illness; problem pertinent system review. Detailed: chief complaint; extended history of present illness; problem pertinent system review extended to include a review of a limited number of additional systems; pertinent past, family, and/or social history directly related to the patient's problems. Comprehensive: chief complaint; extended history of present illness; review of systems which is directly related to the problem(s) identified in the history of the present illness plus a review of all additional body systems; complete past, family and social history. The comprehensive history obtained as part of the preventive medicine evaluation and management service is not problem-oriented and does not involve a chief complaint or present illness. It does, however, include a comprehensive system review and comprehensive or interval past, family and social history as well as a comprehensive assessment/history of pertinent risk factors. Determine the Extent of Examination Performed The extent of the examination performed is dependent on clinical judgment and on the nature of the presenting problem(s). The levels of E/M services recognize four types of examination that are defined as follows: Problem focused: a limited examination of the affected body area or organ system. Expanded problem focused: a limited examination of the affected body area or organ system and other symptomatic or related organ system(s). Detailed: an extended examination of the affected body area(s) and other symptomatic or related organ system(s). Comprehensive: a general multi-system examination or a complete examination of a single organ system. Note: The comprehensive examination performed as part of the preventive medicine evaluation and management service is multi-system, but its extent is based on age and risk factors identified. For the purposes of these CPT definitions, the following body areas are recognized: Head, including the face Neck Chest, including breasts and axilla Abdomen Genitalia, groin, buttocks Back Each extremity For the purposes of these CPT definitions, the following organ systems are recognized: Eyes Ears, Nose, Mouth and Throat Cardiovascular Respiratory Gastrointestinal Genitourinary Musculoskeletal Skin Neurologic Psychiatric Hematologic/Lymphatic/Immunologic Determine the Complexity of Medical Decision Making Medical decision making refers to the complexity of establishing a diagnosis and/or selecting a management option as measured by: the number of possible diagnoses and/or the number of management options that must be considered; the amount and/or complexity of medical records, diagnostic tests, and/or other information that must be obtained, reviewed and analyzed; and the risk of significant complications, morbidity and/or mortality, as well as comorbidities, associated with the patient's presenting problem(s), the diagnostic procedure(s) and/or the possible management options. Four types of medical decision making are recognized: straightforward; low complexity; moderate complexity; and high complexity. To qualify for a given type of decision making, two of the three elements in Table 2 below must be met or exceeded. Comorbidities/underlying diseases, in and of themselves, are not considered in selecting a level of E/M services unless their presence significantly increases the complexity of the medical decision making. The referenced Table 2, titled "Complexity of Medical Decision Making," sets forth guidelines for the four types of decision-making (straightforward, low complexity, moderate complexity, and high complexity) in terms of the relative number and/or complexity of three elements: number of diagnoses or management options (minimal, limited, multiple, or extensive); amount and/or complexity of data to be reviewed (minimal or none, limited, moderate, or extensive); and risk of complications and/or morbidity or mortality (minimal, low, moderate, or high). The "Office or Other Outpatient Services" section of the CPT book provides the codes for those services in terms of the guidelines set forth above. Five codes of increasing complexity are provided for new patients, and five counterpart codes are provided for established patients: New Patient 99201 Office or other outpatient visit for the evaluation and management of a new patient, which requires these three key components: a problem focused history; a problem focused examination; and straightforward medical decision making. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problems are self- limited or minor. Physicians typically spend 10 minutes face-to-face with the patient and/or family. 99202 Office or other outpatient visit for the evaluation and management of a new patient which requires these three key components: an expanded problem focused history; an expanded problem focused examination; and straightforward medical decision making. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problems are of low to moderate severity. Physicians typically spend 20 minutes face-to-face with the patient and/or family. 99203 Office or other outpatient visit for the evaluation and management of a new patient which requires these three key components: a detailed history; a detailed examination; and medical decision making of low complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problems are of moderate severity. Physicians typically spend 30 minutes face-to-face with the patient and/or family. 99204 Office or other outpatient visit for the evaluation and management of a new patient which requires these three key components: a comprehensive history; a comprehensive examination; and medical decision making of moderate complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problems are of moderate to high severity. Physicians typically spend 45 minutes face-to-face with the patient and/or family. 99205 Office or other outpatient visit for the evaluation and management of a new patient which requires these three key components: a comprehensive history; a comprehensive examination; and medical decision making of high complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problems are of moderate to high severity. Physicians typically spend 60 minutes face-to-face with the patient and/or family. Established Patient 99211 Office or other outpatient visit for the evaluation and management of an established patient that may or may not require the presence of a physician. Usually, the presenting problem(s) are minimal. Typically, 5 minutes are spent performing or supervising these services. 99212 Office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: a problem focused history; a problem focused examination; straightforward medical decision making. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problem(s) are self- limited or minor. Physicians typically spend 10 minutes face-to-face with the patient and/or family. 99213 Office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: an expanded problem focused history; an expanded problem focused examination; medical decision making of low complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problem(s) are of low to moderate severity. Physicians typically spend 15 minutes face-to-face with the patient and/or family. 99214 Office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: a detailed history; a detailed examination; medical decision making of moderate complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problem(s) are of moderate to high severity. Physicians typically spend 25 minutes face-to-face with the patient and/or family. 99215 Office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: a comprehensive history; a comprehensive examination; medical decision making of high complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the presenting problem(s) are of moderate to high severity. Physicians typically spend 40 minutes face-to-face with the patient and/or family. Medicaid reimburses physicians according to the level of complexity of the office visit. The more complex the visit (and hence the higher the CPT code number), the greater the level of reimbursement. The Audit During the audit period, Petitioner submitted 2,215 Medicaid claims for services rendered to 382 patients, for which he received Medicaid payments of $134,469.21. In making a determination of overpayment, AHCA is not required to review each and every Medicaid claim submitted by a provider. Section 409.913(19), Florida Statutes, permits the agency to employ "appropriate statistical methods," including "sampling and extension to the population," to make its determination. In this instance, AHCA randomly selected a "cluster sample" of 39 patients from the 382 Medicaid patients to whom Petitioner had provided services during the audit period, and asked Petitioner to produce the medical records he had on file for these 39 patients. AHCA chose the cluster sample of 39 patients according to a statistical formula indicating a 95 percent probability that any overpayment amount would be at least the amount identified. By selecting the 95 percent confidence factor, AHCA attempted to ensure that any potential error in the audit would be resolved in favor of the audited physician. AHCA's statistical expert, Dr. Mark Johnson, validated the methodology used by AHCA. Dr. Johnson not only reviewed AHCA's work, but conducted his own independent analysis that reproduced AHCA's results. Dr. Johnson's testimony as to the reliability of AHCA's methodology is credited. Copies of the medical records were provided to AHCA by Zheila Galvez, the office assistant in charge of Petitioner's billings, on or about March 1, 1999. Ms. Galvez certified that she provided AHCA the complete medical records for the 39 patients, and acknowledged that these records would provide the only information AHCA would use in its audit. Petitioner was later provided an opportunity to supplement the records, but provided nothing further to the agency. At the hearing, counsel for Petitioner objected that AHCA failed to prove that the records it produced in evidence were the complete records as provided to AHCA by Ms. Galvez. The objection was rejected. No evidence was presented to show that AHCA mishandled the documents. Petitioner made no claim that a specific record was missing, and Petitioner was in the best position to know whether the records were complete. Petitioner had submitted a total of 232 claims for services rendered to the 39 patients in the cluster sample during the audit period. Each of these claims was reviewed by AHCA to determine whether it was supported by information contained in the medical records produced by Petitioner in response to AHCA's request. AHCA employee Dr. John Sullenberger, a physician who was not in active practice, performed the initial audit, reviewing all the claims for the 39 patient cluster sample. Dr. Sullenberger's work resulted in the First Audit Report that concluded Petitioner had been overpaid $72,724.89. As noted in the Preliminary Statement above, AHCA withdrew Dr. Sullenberger's audit because newly enacted Section 409.9131, Florida Statutes, mandated "peer review" in agency determinations of overpayment. Dr. Sullenberger did not meet the statutory definition of "peer" because he was not in active practice. See Section 409.9131(2)(c), Florida Statutes. AHCA engaged Dr. Timothy Walker, an active, Board- certified family practice physician who is a faculty member of Tallahassee Memorial Hospital's Family Practice Residency Program, to perform a second audit. Through Dr. Walker's deposition testimony, AHCA established that Dr. Walker's background, work experience and education establish him as an expert in CPT coding, qualified to render an opinion on the propriety of Petitioner's coding and billing practices. Dr. Walker reviewed the records that Petitioner had provided regarding the 39 patients in the cluster sample to determine whether there was documentation to support the Medicaid claims relating to these patients. Dr. Walker's review found that Petitioner exclusively billed the highest levels of CPT coding for outpatient services, i.e., 99205 for new patients and 99215 for established patients. Dr. Walker found that Petitioner failed to document a level of service consistent with these codes. Dr. Walker performed his own review of Petitioner's medical records and noted his conclusions as to the level of CPT coding that could be supported by the record of each patient for each visit to Petitioner's office. Dr. Walker found that all of the visits should have been billed at lower levels, based on the documentation provided by Petitioner. Dr. Walker's testimony is credited as to his review of Petitioner's records. Margarete Johnson, AHCA's registered nursing consultant, performed the calculations by which Dr. Walker's conclusions as to the proper coding were translated into dollar figures. These calculations were a simple function of addition and subtraction, using the relevant Medicaid reimbursement amounts for the various codes. Petitioner had been reimbursed $14,101.44 for the claims related to the 39 patients. Following Dr. Walker's analysis, Ms. Johnson calculated that $8,520.59 of that amount constituted overpayments. Using the generally accepted, appropriate, and valid statistical formula described by Dr. Johnson, AHCA extended this result to the total population of 2,215 Medicaid claims that Petitioner had submitted for services rendered during the audit period, and correctly calculated that Petitioner had been overpaid a total of $77,848.16. Petitioner did not present a case-in-chief. Petitioner's only exhibits were three pages that duplicated documents presented by AHCA, except for the fact that they carried an additional, later agency date stamp not found on those presented by AHCA. Petitioner claimed that these documents proved that AHCA did not produce its entire file on Petitioner during discovery or at the hearing. AHCA's witness Jack Williams explained that the extra, later date stamp on these documents resulted from Petitioner's having re-submitted these pages to AHCA as exhibits to his petition for formal hearing. This explanation was sufficient to allay any suspicion that AHCA's production was less than complete. On the strength of the evidence and testimony presented by AHCA, and in the absence of any evidence or testimony to the contrary, it is found that Petitioner received Medicaid overpayments in the amount of $77,848.16.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that AHCA enter a final order finding that Petitioner received $77,848.16 in Medicaid overpayments for services rendered to his Medicaid patients from December 4, 1996 to December 4, 1998, and requiring him to repay this amount to the agency. DONE AND ENTERED this 24th day of October, 2001, in Tallahassee, Leon County, Florida. LAWRENCE P. STEVENSON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 24th day of October, 2001. COPIES FURNISHED: Donald W. Weidner, Esquire Matthew D. Weidner, Esquire Weidner, Bowden & Weidner 11265 Alumni Way, Suite 201 Jacksonville, Florida 32246 Anthony L. Conticello, Esquire Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building Three Tallahassee, Florida 32308-5403 Diane Grubbs, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building Three, Suite 3431 Tallahassee, Florida 32308 William Roberts, Acting General Counsel Agency For Health Care Administration Fort Knox Building Three, Suite 3431 Tallahassee, Florida 32308
Conclusions This cause came before the Agency for Health Care Administration for issuance of a Final Order. 1. On May 23, 2013, the Agency sent a letter to the Petitioner notifying the Petitioner that it owed an overpayment in the amount of $50,992.15 to the Agency based upon an adjustment in the Petitioner's overpayment rates (Exhibit A). On June 17, 2013, the Petitioner filed a Petition for Formal Hearing and the Agency Clerk referred the Petition for Formal Hearing to the Division of Administrative Hearings for further proceedings. On July 1, 2013, the Administrative Law Judge assigned to the case entered an Order Closing File and Relinquishing Jurisdiction based upon a Joint Motion to Relinquish Jurisdiction filed by the parties. On May 23, 2014, the Agency rescinded the overpayment letter (Exhibit B). The Agency’s rescission of the overpayment letter has rendered this matter moot. Filed August 14, 2014 9:30 AM Division of Administrative Hearings a tenE’ AGENCY CLERK P 3 3u Based on the foregoing, IT IS THEREFORE ORDERED AND ADJUDGED THAT: Respondent’s right to a hearing in this matter has been rendered moot and the Agency’s May 11, 2013 overpayment letter is rescinded. The parties shall govern themselves accordingly. DONE AND ORDERED this g day of Avnus® ; 2014 in Tallahassee, Leon County, Florida. AGENCY FOR HEALTH CARE ADMINISTRATION
Findings Of Fact The Parties The Petitioner is the state agency that administers the Florida Medicaid program, which includes pharmacies that participate in the program. The Petitioner's Office of Program Integrity is responsible for insuring that the goods and services billed to the Medicaid program are those that are actually provided to Medicaid recipients. Medicaid is a joint program, funded by the federal government and by the State of Florida, and is administered pursuant to both state and federal statutes and rules. All services or goods billed to the program must be necessary, Medicaid compensable, and must also have actually been provided to eligible recipients by providers prior to submitting claims. Any payment made by the Medicaid program for goods or services not actually provided to an eligible recipient is subject to recoupment by the Petitioner, and the provider is also subject to the imposition of administrative fines and exclusion from the program for a specified period of time. The Respondent is a community pharmacy located in a hispanic section of Miami, Florida, which has been owned and operated for the past six years by Frances Larin, a licensed pharmacist, who makes all drug purchases and does all Medicaid billings at the pharmacy herself. Most of Respondent's customers have limited financial resources and are Medicaid recipients. The Respondent has participated in the Medicaid program for approximately eight years, and has not previously been charged with overbilling the Medicaid program. The Respondent has cooperated fully with the Petitioner throughout these proceedings. Prior Review From February to April 1988, the Petitioner's Office of Program Integrity had a review performed of the Respondent's billings to Medicaid from March 1, 1987 to December 31, 1987. This review was conducted for the Petitioner by the Foundation for Health Care, Inc. (Foundation), contract auditors, and resulted in the determination that the Respondent had overbilled the Medicaid program for prescription drugs dispensed to program recipients during the review period. In performing this review, the Foundation used an across-the-board Medicaid percentage of 54% in determining the available units of the various drugs on hand for dispensing to Medicaid recipients. Based upon the Foundation's review, the Petitioner sought recoupment for overpayments in the amount of $28,649.99 by letter to the Respondent dated July 20, 1988, as well as an administrative fine of $7,162.49, and a three month suspension from the program. The Respondent timely sought a formal administrative hearing in which it disputed the results of the Foundation review. However, after the matter was referred to the Division of Administrative Hearings, the Petitioner withdrew its notice of overpayment and imposition of administrative sanctions, and thus, without a determination on the merits, the Division of Administrative Hearings file was closed and jurisdiction was relinquished to the Petitioner. Subsequently, the Petitioner entered a Final Order which provided that the Respondent would be re-audited. The Respondent timely sought judicial review of this Final Order in which it challenged that Petitioner's right to conduct a further review of the period March 1, 1987 to December 31, 1987. However, the District Court of Appeal of Florida, Third District, dismissed the Respondent's appeal, and the Petitioner proceeded with a further review. The KPMG Review (a) For purposes of its further review, the Petitioner employed the public accounting and management consulting firm of KPMG Peat Marwick which designed a statistically valid sampling methodology to determine the Respondent's Medicaid percentage for each drug, and also to perform a management review of the Respondent. It was established by competent substantial evidence in the record, and in particular by the expert testimony in statistics from Dr. Robert Ladner and Robert Peirce, that the KPMG methodology was statistically valid. The KPMG review was conducted during the latter half of 1989, and included developing a Medicaid percentage for individual drugs based upon an analysis of prescriptions for all drugs in question to determine the portion of each drug's total sales that went to Medicaid recipients, calculating the total units claimed for each drug for which the Respondent sought reimbursement during the audit period, and calculating the total units purchased by the Respondent for each drug claimed for reimbursement during the audit period. The Medicaid percentage of each drug was then applied to total purchases for each specific drug to determine the amount of each drug that was on hand at the Respondent's pharmacy for dispensing to Medicaid recipients. This number of available units was then compared with the total units claimed for reimbursement. Where the units claimed exceeded the units available for dispensing, a positive variance was noted, and this number of excess units claimed was then multiplied by the per unit reimbursement amount for that particular drug in order to obtain the amount of the apparent overbilling for that particular drug. Where the total units available for dispensing exceeded the total units claimed for a particular drug, a negative variance was noted. It was stipulated by the parties that negative variances did not indicate underpayments, and the evidence, including specifically the testimony and report of Dr. Victor Pestien, an expert in statistics, does not establish that such negative variances should be offset against the positive variances or that they in any way reduce the positive variances. This is the first instance in which this methodology has been utilized by the Petitioner in seeking a recoupment of an alleged Medicaid overpayment from a pharmacy, and this methodology was not set forth in any rule or regulation of the Petitioner that had been adopted at any time material hereto. Previous audits used an overall Medicaid percentage to calculate the portion of a pharmacy's business that was comprised of Medicaid recipients, and the quantity of drugs that were available to them. Using a drug specific Medicaid percentage, however, is a more accurate and conservative approach to determining overpayments than using a fixed percentage. Based upon the consideration of all evidence in the record, it is specifically found that the greater weight of evidence establishes that the methodology used by KPMG in this review for calculating Medicaid percentages was sound and reasonable, and in no way precluded the Respondent from presenting additional competent substantial evidence to the Petitioner, or at hearing, which would have established different Medicaid percentages for particular drugs. (a) The type of review conducted by KPMG is known as an aggregate analysis, a generally accepted type of statistical analysis, in which drugs that have been billed to and paid for by the Medicaid program are reviewed to determine whether the pharmacy under review purchased or otherwise acquired a sufficient quantity of drugs to justify its billings to Medicaid. Interchangeable brand-name drugs and generic equivalents were grouped together so that in conducting this review, whole equivalent groups of drugs were considered as one type of drug, regardless of differences in individual product names. To obtain a statistically random sample, prescriptions were put in numerical order and every fourth prescription for the review period was examined, and since prescriptions may be refilled for up to a year after they are originally filled, reviewers also examined every prescription for the year prior to the review period. Competent substantial evidence establishes that KPMG performed an appropriate and valid statistical analysis, and that they used an acceptable sampling methodology which produced a truly random result. The underlying assumption of this analysis is that before a drug can be claimed to have been dispensed and billed to Medicaid, the pharmacy under review must have that drug in its possession. (b) The approach taken by KPMG and the Petitioner was to be as conservative as possible in resolving all uncertainties and questions which arose during the course of this review in favor of the Respondent. KPMG did not conduct a financial audit of the Respondent, but did prepare a management report based upon its review of Respondent's operations during the audit period. Data used by KPMG in its methodology in calculating the amount paid by Medicaid to the Respondent, the unit price of drugs dispensed, and the quantity claimed by Respondent for payment by Medicaid, was derived from computer based information provided by the Petitioner's fiscal agent. During the period of time being reviewed in this case, Electronic Data Systems (EDS) was the Petitioner's fiscal agent, while Consultec was the Petitioner's fiscal agent during the period when the KPMG review was actually being performed. When Consultec was selected as the Petitioner's fiscal agent and replaced EDS on January 1, 1989, EDS turned over its computer records to the new agent by copying all of its magnetic, computer files, along with supporting microfiche documentation, which it then provided to Consultec under the supervision of the Petitioner. Upon receipt of these magnetic tapes, Consultec placed them in a controlled environment vault, and then later converted the information on these tapes to a new format used by Consultec. It was established by competent substantial evidence that in this process, no data was added, deleted or changed in any manner. The "units claimed" data was subsequently provided by computer download from the Consultec claims data base directly to the Petitioner's Office of Program Integrity. It was established by competent substantial evidence that data regarding claims which originated with EDS passed through Consultec to the Petitioner's Office of Program Integrity unchanged. Specific information regarding Respondent, including the claimed quantity of drugs dispensed and amounts paid, was accessed by staff in the Office of Program Integrity, randomly verified, and then made available to KPMG. Both Consultec and EDS are nationally recognized data processing and management companies. Competent substantial evidence established that the claims processing function utilized by the Petitioner in the Medicaid program during the period at issue was subject to several quality control checks to insure that claims were properly processed and appropriate payments were made. On occasion claim adjustments were made, but these were reasonable and for good cause, such as a substantiated underpayment. The computer hardware utilized in this process was reliable and properly maintained. In order to verify the data used by KPMG concerning the dollar amount of claims paid and the quantity of units of medication claimed, an "audit trail" was performed using 140 randomly selected sample claims by tracing each claim from its claim reference number to its associated remittance voucher and cancelled checks, where available. This audit trail verified that the data used as the basis for quantity claimed and total dollars paid was valid and reliable. The KPMG review was not limited to the top 100 drugs, by volume claimed, during the audit period, but included each drug dispensed by the Respondent to Medicaid recipients during the audit period. In its report dated November 20, 1989, KPMG calculated a total Medicaid overpayment to Respondent of $30,452.59, and based thereon, the Petitioner notified the Respondent that it was seeking recoupment of this amount, as well as an administrative fine of $2,000 and termination from the Medicaid program for at least two years. Subsequently, however, the Petitioner and KPMG reviewed and considered additional invoices documenting additional purchases of drugs in question by the Respondent during the audit period, and prepared a revised report dated August 30, 1990. Based upon this revised report, the Petitioner sought recoupment of a revised, reduced overpayment calculated to be $21,939.93, as well as a $2,000 administrative fine and a minimum two year termination from the program, and it was on this basis that this matter proceeded to final hearing. The Top 100 Drugs Subsequent to the final hearing, the Petitioner issued an amended recoupment letter dated October 17, 1990, which limited the recoupment it is seeking in this matter to the top 100 drugs, by dollar volume of claims, plus their generic equivalents. This resulted in the elimination of many individual drugs with relatively small overpayments from the list of overpayments, and left only five instances among these top 100 drugs where the difference between the quantity available, adjusted for standard error, and the quantity claimed is less than 100 units. In many instances the difference is well in excess of 1,000 units. The sanctions being sought in this amended recoupment letter further reduced the recoupment being sought to $12,643.11, reduced the administrative fine to $1,400, and reduced the period of exclusion from the program that is being sought to 16 months. However, due to an error in calculating the top 100 drugs and equivalents, the Petitioner issued a second amended recoupment letter dated October 26, 1990, further reducing the administrative fine sought to $1,200 and reducing the period of exclusion to 14 months. Inventory Analysis In performing its review, KPMG obtained information concerning the quantities of drugs purchased during the review period by the Respondent directly from the pharmacy's wholesalers and from a review of invoices retained by the Respondent for a period that included one month prior to the review period through one month after the review period (February 1, 1987, to January 31, 1988). The effect of seasonal variations in pharmacy sales and ordering patterns was also taken into account, and balanced, by extending this period to a full twelve months. All documentation concerning drug acquisitions was requested from Respondent, and the information received and considered by KPMG and the Petitioner was checked for reasonableness by a consultant pharmacist and cross validated by two reviewers. It was stipulated by the parties that the Respondent's main wholesaler, Gulf Distribution, Inc., had and maintained accurate information and records regarding its sales to the Respondent, and that it properly transferred that information to computer disks which were provided to KPMG. Subsequent thereto, additional invoices were discovered and were also made available to KPMG. The Petitioner stipulated that these additional invoices from Gulf did not reduce the number of drug units purchased by, and invoiced to, Respondent. Pharmacies in Florida which choose to participate in the Medicaid program are required to maintain complete and accurate patient and fiscal records which fully substantiate the extent of services rendered and billings made for a period of five years from the date of billing or service, and are also required to retain all invoices from wholesalers, or from the transfer or receipt of drugs through barter or exchange, for a period of five years. (a) Actual beginning and ending inventories of the top 100 drugs reviewed by KPMG for which the Petitioner now seeks recoupment in the amount of $12,643.11 were not determined. Rather, an estimate of inventory on hand was derived by counting invoices of all drug acquisitions through purchase, transfer or exchange made by the Respondent during the review period, as well as invoices of acquisitions made one month prior to and one month after the review period. Additionally, all documentation provided by the Respondent of bulk, or large, acquisitions made during or prior to the review period was also considered and included in the Petitioner's estimate of inventory. It was established by competent substantial evidence that pharmacies generally keep a drug inventory consisting of a two to two-and-a-half week supply on hand, and acquire drugs in anticipation of future sales rather than as a replacement of inventory depletion from past sales. Therefore, a basic assumption of the KPMG methodology, relied upon and accepted by the Petitioner, that Respondent had only those drugs available for dispensing which were obtained by invoiced purchase from wholesalers, or through transfer or exchange, between February 1, 1987 and January 31, 1988, as well as documented invoiced bulk purchases prior to this time period, is reasonable. At hearing, the Respondent established that a significant quantity of nine specific drugs were purchased during the review period from suppliers other than Gulf that were not considered by KPMG. These drugs include Xanax (.5 mg.), Inderal (10 mg.), Tagamet (300 mg.), Nitrostat (.4 mg.), Trental (400 mg.), Motrin (400 mg.), Motrin (600 mg.), Quinamm (260 mg.), and Quinidine Sulfate (200 mg.). It is, therefore, found that the overpayment of $2,902.19 calculated by KPMG and relied upon by the Petitioner for these particular drugs has not been supported by competent substantial evidence. Frances Larin, Respondent's owner and operator, testified that she did not follow the generally accepted practice of retaining only a two to two-and-a- half week supply of drugs on hand. Rather, she testified that for a significant number of the top 100 drugs at issue in this proceeding, she would purchase large quantites in bulk, and was thus able to draw down on these inventories without making additional purchases of particular drugs for over a year. The Respondent sought to establish that due to very large beginning inventories of particular drugs at issue, it was able to legitimately dispense more units during the review period than it purchased during the same time. However, the Respondent did not produce evidence in support of its position, such as invoices for bulk purchases which KPMG or the Petitioner did not consider, or complete records of bartering or transfers which had not been considered, and which would have supported its claim of a significantly larger beginning inventory for these particular drugs than would be the generally accepted practice. To the contrary, competent substantial evidence in the record, as well as the demeanor of Larin while testifying, establishes that Respondent's claim is unreasonable and lacks credibility. The deposition testimony of JoAnn Padell is outweighed by the testimony of Deborah Launer, Susan McCleod, and Robert Peirce. A review of the Respondent's purchasing patterns clearly shows that Respondent generally and routinely kept low inventories of drugs on hand, placing daily orders with Gulf to obtain drugs on an as-needed basis. Recoupment Based upon the foregoing, it is found that competent substantial evidence establishes that the Respondent overbilled the Medicaid program during the review period at issue in this case in the amount of $9,740.92 ($12,643.11 claimed in the second amended recoupment letter minus the $2,902.19 claim associated with the nine specific drugs for which significant purchases were omitted from the KPMG review, as found above at Finding 13). Petitioner is authorized to recoup the established overpayment of $9,740.92 from the Respondent. Sanctions (a) In determining the sanctions stated in the second amended recoupment letter which Petitioner seeks to impose upon the Respondent, the Petitioner considered the provisions of Section 409.266(13), Florida Statutes, as well as the impact which sanctioning this Medicaid provider would have upon Medicaid recipients. Competent substantial evidence establishes that there are eight pharmacies which accept Medicaid within a one mile radius from the Respondent's location, and twenty-six such pharmacies within a two mile radius. Medicaid recipients are issued new cards each month and may transfer pharmacies at the beginning of each month. Therefore, it is found that Medicaid recipients would not be substantially affected by the imposition of sanctions upon the Respondent. The parties stipulated that the sanction matrix set forth in Rule10C- 7.063, Florida Administrative Code, was not applied by the Petitioner against the Respondent in this case because it was not in effect at the time of this review. The sanctions which the Petitioner seeks to impose against the Respondent, therefore, are based upon non-rule policy which must be explicated in this proceeding. In seeking to explicate its non-rule policy upon which the sanctions set forth in the second amended recoupment letter are based, the Petitioner established that it was concerned that sanctions imposed in prior cases, as well as in the original recoupment letter which had been sent to the Respondent in this case, had been too lenient in view of the seriousness of Medicaid violations. The Petitioner developed its non-rule sanctions policy after the KPMG review had been completed, and based its proposal upon the maximum sanctions set forth in state and federal statutes and rules. Specifically, Section 409.266(12), Florida Statutes, provides for a maximum fine of $10,000; the maximum exclusion period applied in previous cases by the Office of Program Integrity is ten years, and the minimum exclusionary period imposed by the federal government has been five years for the failure to supply payment information. At hearing, the Petitioner explained that it first determined the percent of Respondent's total Medicaid payments that the overpayment represented, and then applied that percentage to these maximum sanctions allowed under law and existing policy. The overpayment of $12,643.11 claimed by the Petitioner in its second amended letter of recoupment is 12% of the total payment of $100,397.88 made by the Petitioner to Respondent for the review period, and 12% of the maximum fine and exclusion period is $1,200 and 14 months, respectively. While the Petitioner explained the manner by which this exclusionary period and fine were calculated, it did not explicate its non-rule policy by establishing a reasonable, rational basis for applying the percentage of Medicaid overbillings to the maximum fine and exclusionary period. Certainly, the arithmetic calculation used to arrive at these proposed sanctions is clear, but there was no explication through competent substantial evidence which would establish that there is a basis in fact or logic for this calculation. Therefore, it is found that the Petitioner's non-rule policy used to propose these sanctions is arbitrary and capricious. Due to the lack of any evidentiary basis in the record which would support the imposition of the sanctions of an administrative fine or a period of exclusion from the Medicaid program, the Petitioner is not authorized to impose sanctions on the Respondent.
Recommendation Based upon the foregoing, it is recommended that Petitioner enter a Final Order which requires that Respondent to repay the Petitioner for Medicaid overbillings in the amount of $9,704.92, but which does not impose sanctions consisting of either an administrative fine or period of exclusion. DONE AND ENTERED this 18th day of January, 1991 in Tallahassee, Florida. DONALD D. CONN Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 Filed with the Clerk of the Division of Administrative Hearings this 18th day of January, 1991. APPENDIX TO RECOMMENDED ORDER Rulings on the Petitioner's Proposed Findings of Fact: Adopted in Finding 1. Adopted in Finding 2. Adopted in Finding 3. Adopted in Finding 1. Adopted in Finding 4. Adopted in Findings 4 and 5. 7-10. Adopted in Findings 6 and 7, but otherwise Rejected as unnecessary. 11-17. Rejected as unnecessary. 18-20. Adopted in Findings 6 and 7. 21-24. Adopted in Finding 12. 25. Adopted in Finding 2. 26-28. This is a conclusion of law and not a proposed finding. 29-30. Adopted in Finding 8. 31-32. Adopted in Findings 7 and 10. Adopted in Finding 6. Rejected as unnecessary. 35-39. Adopted in Finding 7. 40-47. Adopted in Finding 7, but otherwise Rejected as unnecessary. 48. Rejected as unnecessary and immaterial 49-51. Adopted in Finding 7, but otherwise Rejected as unnecessary. 52-53. Rejected as unnecessary. 54-63. Adopted in Finding 12, but otherwise Rejected as unnecessary. Adopted in Finding 8. Adopted in Finding 9. 66-67. Adopted in Finding 8, but otherwise Rejected as unnecessary. 68-69. Adopted in Finding 9. 70-78. Adopted in Finding 8, but otherwise Rejected as unnecessary. 79-82. Adopted in Finding 8. 83-85. Rejected as unnecessary. 86-93. Adopted in Finding 13, but otherwise Rejected as unnecessary. 94-97. Adopted in Finding 14, but otherwise Rejected as unnecessary. 98-103. Adopted in Finding 14. 104-105 Rejected as unnecessary and immaterial. 106-107 Adopted in Finding 12. 108. Adopted in Findings 12 and 13. 109-112 Rejected as unnecessary and immaterial. 113-115 Adopted in Finding 13, but otherwise Rejected as immaterial. This is a conclusion of law and not a proposed finding. Adopted in Finding 11. 118-119 Rejected as unnecessary and immaterial 120-122 Adopted in Finding 11. Rejected as unnecessary. Adopted in Finding 6. 125-128 Rejected as unnecessary. 129. Adopted in Finding 6. 130-132 Adopted in Finding 9. Adopted in Finding 11. This is a conclusion of law and not a proposed finding. 135-147 Adopted in Finding 16, but otherwise Rejected as unnecessary and immaterial. 148. Adopted in Finding 11. 149-150 Adopted in Finding 16, but otherwise Rejected as unnecessary. 151-152 Rejected as unnecessary. 153. Rejected as unnecessary and cumulative. Rulings on the Respondent's Proposed Findings of Fact: 1. Adopted in Finding 4. 2-3. Adopted in Finding 5, but otherwise Rejected as unnecessary and not based on competent substantial evidence. 4-5. Adopted in Findings 3, 6 and 7. 6-7. Adopted in Finding 10, but otherwise Rejected as unnecessary. 8-9. Adopted in Finding 11. 10-11. Adopted in Finding 3, but otherwise Rejected as unnecessary. Adopted in Finding 6. Rejected as immaterial and unnecessary. 14-15. Rejected as argument on the evidence rather than a proposed finding, and otherwise as not based on competent substantial evidence. Adopted in Finding 7, but otherwise Rejected as argument on the evidence rather than a proposed finding. Rejected as repetitive and otherwise as immaterial. Adopted in Finding 13, but Rejected in Finding 14 and otherwise as argument on the evidence rather than a proposed finding and as not based on competent substantial evidence. Rejected in Finding 14, as immaterial, speculative, and as not based on competent substantial evidence. 20-21. Rejected in Finding 6, as immaterial, and as not based on competent substantial evidence. 22-23. Rejected in Findings 13 and 14, and otherwise as immaterial and not based on competent substantial evidence. Rejected as repetitive and otherwise as argument on the evidence rather than a proposed finding. Rejected in Findings 13 and 14. 26-30. Rejected as a statement of the Respondent's position and not a proposed finding, as speculative and contrary to competent substantial evidence, and as totally without citation to authority in the record as required by Rule 22I-6.031(3), Florida Administrative Code. 31-35. Rejected in Finding 6, and as not based on competent substantial evidence and as unnecessary. 36-38. Adopted in Findings 12 and 13. 39-41. Adopted in Finding 8. 42. Rejected as immaterial. 43-44. Rejected in Finding 9. 45. Rejected as simply a summation of testimony and not a proposed finding. 46-48. Rejected in Finding 9, and otherwise as immaterial and not based on competent substantial evidence. 49-50. Rejected as unnecessary and immaterial. 51. Adopted in Finding 16, but otherwise Rejected as immaterial. 52-53. Rejected as unnecessary and immaterial. Rejected as not based on competent substantial evidence. Adopted and Rejected in part in Finding 16. 56-57. Adopted in Finding 16. 58-61. Rejected as immaterial and irrelevant. 62. Adopted and Rejected in part in Finding 15. COPIES FURNISHED: David G. Pius, Esquire Building Six, Room 233 1317 Winewood Boulevard Tallahassee, FL 32399-0700 James J. Breen, Esquire Michael P. Scian, Esquire 900 Sun Bank Building 777 Brickell Avenue Miami, FL 33131 R. S. Power, Agency Clerk 1323 Winewood Boulevard Tallahassee, FL 32399-0700 Linda Harris, Acting General Counsel 1323 Winewood Boulevard Tallahassee, FL 32399-0700 Robert B. Williams, Acting Secretary 1323 Winewood Boulevard Tallahassee, FL 32399-0700
The Issue The issues are whether Petitioner received a Medicaid overpayment for claims paid during the audit period, August 1, 1997, through August 25, 1999, and if so, what is the amount that Petitioner is obligated to reimburse to Respondent.
Findings Of Fact Respondent is the agency responsible for administering the Florida Medicaid Program. One of its duties is to recover Medicaid overpayments from physicians providing care to Medicaid recipients. Petitioner is a licensed psychiatrist and an authorized Medicaid provider. His Medicaid provider number is No. 048191200. Chapter Three of the Limitations Handbook describes the procedure codes for reimbursable Medicaid services that physicians may use in billing for services to eligible recipients. The procedure codes are Health Care Financing Administration Common Procedure Coding System (HCPCS), Levels 1-3. The procedure codes are based on the Physician's Current Procedural Terminology (CPT) book, published by the American Medical Association. The CPT book, includes HCPCS descriptive terms, numeric identifying codes, and modifiers for reporting services and procedures. The Limitations Handbook further provides that Medicaid reimburses physicians using specific CPT codes. The CPT codes are listed on Medicaid's physician fee schedule. The CPT book includes a section entitled Evaluation and Management (E/M) Services Guidelines. The E/M section classifies medical services into broad categories such as office visits, hospital visits, and consultations. The categories may have subcategories such as two types of office visits (new patient and established patient) and two types of hospital visits (initial and subsequent). The subcategories of E/M services are further classified into levels of E/M services that are identified by specific CPT codes. The classification is important because the nature of a physician's work varies by type of service, place of service, and the patient's status. According to the CPT book, the descriptors for the levels of E/M services recognize seven components, six of which are used in defining the levels of E/M services. They are history, examination, medical decision making, counseling, coordination of care, nature of presenting problem, and time. The most important components in selecting the appropriate level of E/M services are history, examination, and medical decision making. However, since 1992, the CPT book has included time as an explicit factor in selecting the most appropriate level of E/M services. At all times relevant here, Petitioner provided services to Medicaid patients pursuant to a valid Medicaid provider agreement. Therefore, Petitioner was subject to all statutes, rules and policy guidelines that govern Medicaid providers. The Medicaid provider agreement clearly gives a Medicaid provider the responsibility to maintain medical records sufficient to justify and disclose the extent of the goods and services rendered and billings made pursuant to Medicaid policy. This case involves Respondent's Medicaid audit of claims paid to Petitioner for Medicaid psychiatric services during the audit period August 1, 1997, through August 25, 1999 (the audit period). Petitioner provided these services to his Medicaid patients, which constituted approximately 85 to 90 percent of his practice, at his office and at hospitals in the Jacksonville, Florida, area. During the audit period, Petitioner billed Medicaid for services furnished under the following CPT codes and E/M levels of service: (a) 99215, office or other outpatient visit for the evaluation and management of an established patient; (b) 99223, initial hospital care per day for the evaluation and management of a patient; (c) 99232, subsequent hospital care per day for the evaluation and management of a patient; (d) 99233, subsequent hospital care per day for the evaluation and management of a patient; (e) 99238, hospital discharge day management; (f) 99254, initial inpatient consultation for a new or established patient; and (g) 90862, other psychiatric service or procedures, pharmacologic management. Except for CPT code 90862, the E/M levels of services billed by Petitioner require either two or all three of the key components as to history, examination, and medical decision- making. The CPT book assigns a typical amount of time that physicians spend with patients for each level of E/M service. The CPT book contains specific psychiatric CPT codes. CPT codes 90804-90815 relate to services provided in the office or other outpatient facility and involve one of two types of psychotherapy. CPT codes 90816-90829 relate to inpatient hospital, partial hospital, or residential care facility involving different types of psychotherapy. CPT codes 90862- 90899 relate to other psychiatric services or procedures. CPT code 90862 specifically includes pharmacologic or medication management; including prescription, use, and review of medication with no more than minimal medical psychotherapy. CPT code 90862 is the only psychiatric procedure code that Petitioner used in billing for the psychiatric services he provided. CPT code 90862 does not have specific requirements as to history, examination, and medical decision-making or a specified amount of time. Most of Petitioner's hospital patients were admitted to the hospital for psychiatric services through the emergency room. As part of the admission process, Petitioner performed psychiatric and physical examinations. However, testimony at hearing that Petitioner generally performed the psychiatric evaluations and the physical examinations on separate days is not persuasive. The greater weight of the evidence indicates that the hospital physical examinations were conducted as part of the routine admission process and appropriately included in claims for the patients' initial hospital care. Some of Petitioner's hospital patients had complicated conditions. Some patients required crisis intervention and/or lacked the ability to perform activities of daily living. The initial hospital care of new hospital patients required Petitioner to take an extensive medical and psychiatric history. Petitioner attended his hospital patients on a daily basis. However, there is no persuasive evidence that Petitioner routinely spent 20-25 minutes with his hospital patients for each subsequent daily visit until the day of discharge. Petitioner used a team approach when attending his hospital patients. On weekdays, the team consisted of Petitioner, a social worker, a music therapist, and the floor nurses. On weekends, Petitioner generally made his rounds with the floor nurses. Petitioner's use of the team approach to treat hospital patients did not change the level of service he provided in managing their medication. Petitioner did not document the time he spent with patients during hospital visits. However, his notations as to each of these visits indicate that, excluding admissions and discharges, the hospital visits routinely involved medication management. Petitioner's testimony that his treatment during subsequent hospital visits involved more than mere medication management is not persuasive. Petitioner also failed to document the time he spent with patients that he treated at his office. He did not present his appointment books as evidence to show the beginning and ending time of the appointments. Petitioner's notes regarding each office visit reflect a good bit of thought. However, without any notation as to time, the office progress notes are insufficient to determine whether Petitioner provided a level of service higher than medication management for established patients. Petitioner and his office manager agreed in advance that, unless Petitioner specified otherwise, every office visit for an established patient would be billed as if it required two of the following: a comprehensive history; a comprehensive examination; and a medical decision making of high complexity. With no documented time for each appointment, Petitioner's records do not reflect that he provided a level of service higher than medication management for the office visits of established patients. Petitioner's testimony to the contrary is not persuasive. Petitioner treated some patients at their place of residence in an adult congregate living facility (ACLF). Respondent does not pay for psychiatric services in such facilities. Instead of entirely denying the claims for ACLF patients, Respondent gave Petitioner credit for providing a lower level of service in a custodial care facility. Sometime in 1999, Respondent made a decision to audit Petitioner's paid claims for the period of time at issue here. After making that decision, Respondent randomly selected the names of 30 Medicaid patients that Petitioner had treated. The 30 patients had 282 paid claims that were included in the "cluster sample." Thereafter, Respondent's staff visited Petitioner's office, leaving a Medicaid provider questionnaire and the list of the 30 randomly selected patients. Respondent's staff requested copies of all medical records for the 30 patients for the audit period. Petitioner completed the Medicaid questionnaire and sent it to Respondent, together with all available medical records for the 30 patients. The medical records included Petitioner's progress notes for office visits. Petitioner did not send Respondent all of the relevant hospital records for inpatient visits. The original hospital records belonged to the hospitals where Petitioner provided inpatient services. Petitioner had not maintained copies of all of the hospital records even though Medicaid policy required him to keep records of all services for which he made Medicaid claims. When Respondent received Petitioner's records, one of Respondent's registered nurses, Claire Balbo, reviewed the records to determine whether Petitioner had provided documentation to support each paid claim. Ms. Balbo made handwritten notes on the records of claims that were not supported by documentation. Ms. Balbo reviewed the documentation in the records between February 10, 2000, and March 7, 2000. Next, one of Respondent's investigators, Art Williams, reviewed the records. Mr. Williams made his review on or about January 23, 2001. In some instances, Mr. Williams changed some of Petitioner's CPT codes from an inappropriate hospital inpatient or office visit procedure code to a psychiatric procedure code with a lower reimbursement rate. Additionally, Mr. Williams noted Petitioner's visits in ACLF's that, according to Medicaid policy, were not reimbursable. Finally, Mr. Williams noted that Petitioner occasionally made several claims on one line of the claim form contrary to Medicaid policy. Mr. Williams made these changes to the CPT codes based on applicable Medicaid policy. His review of the audit documents and patient records did not involve a determination as medical necessity or the appropriate level of service. A peer reviewer makes determinations as to medical necessity and the appropriate level of service for each paid claim in the random sample of 30 patients. Respondent then sent the records to Dr. Melody Agbunag, a psychiatrist who conducted a peer review of Petitioner's records. Dr. Agbunag's primary function was to determine whether the services that Petitioner provided were medically necessary and, if so, what the appropriate level of service was for each paid claim. Dr. Agbunag conducted the peer review between June 8, 2001, and August 29, 2001. She agreed with Respondent's staff regarding the adjustments to the procedure codes that corresponded with the level of service reflected in the medical records. When Dr. Agbunag returned the records to Respondent, Ms. Balbo calculated the monetary difference between the amount that Medicaid paid Petitioner for each claim and the amount that Medicaid should have paid based on Dr. Agbunag's review. The difference indicated that Respondent had overpaid Petitioner for claims that in whole or in part were not covered by Medicaid. Respondent sent Petitioner a Preliminary Agency Audit Report (PAAR) dated December 27, 2001. The PAAR stated that Petitioner had been overpaid $54,595.14. The PAAR stated that Petitioner could furnish additional information or documentation that might serve to reduce the overpayment. Petitioner responded to the PAAR in a letter dated February 28, 2001. According to the letter, Petitioner challenged the preliminary determinations in the PAAR and advised that he was waiting on additional patient records from a certain hospital. In a letter dated June 30, 2002, Petitioner advised Respondent that he generally spends 15-20 minutes with his hospital inpatients. The letter does not refer to any additional hospital records. Petitioner's office manager sent Respondent a letter dated August 1, 2002. The letter discusses every service that Petitioner provided to the 30 patients during the audit period. Some of these services were not included in the random "cluster sample" because Medicaid had not paid for them during the audit period. According to the August 1, 2002, letter, Petitioner's office manager attached some of the patient records that Petitioner had not previously provided to Respondent. The additional documentation related to multiple claims involving several of Petitioner's hospital and office patients. Sometime after receiving the additional documentation, Dr. Agbunag conducted another peer review. She did not change her prior determination regarding the level of service as to any paid claim. In 2003, Vicki Remick, Respondent's investigator, reviewed the audit, the patient records, and all correspondence. Her review included, but was not limited to, the determination of the appropriate CPT code and amount of reimbursement, taking into consideration Medicaid policy and Dr. Agbunag's findings regarding medical necessity and the level of care for each paid claim. On or about October 1, 2003, Respondent issued the Final Agency Audit Report (FAAR). The FAAR informed Petitioner that he had been overpaid $39,055.34 for Medicaid claims that, in whole or in part, were not covered by Medicaid. The FAAR included a request for Petitioner to pay that amount for the overpayment. The FAAR concluded, as to some patients, that Petitioner's documentation did not support the CPT codes that Petitioner used to bill and that Respondent used to pay for services. Thus, Respondent "down graded" the billing code to a lesser amount. As a result, the difference between the amount paid and the amount that should have been paid was an overpayment. The FAAR also stated that Petitioner billed and received payment for some undocumented services. In each such instance, Respondent considered the entire amount paid as an overpayment. The FAAR indicated that Petitioner billed Medicaid for some services at acute care hospital psychiatric units without documenting the medical records as to the appropriate CPT codes and medical illness diagnosis codes. Respondent adjusted the payments for these services to the appropriate psychiatric CPT codes. According to the FAAR, Petitioner billed and received payment for services which only allowed one unit of service per claim line. For this audit, Respondent allowed charges for the additional units of service where Petitioner's documentation for the additional dates of service supported the services allowed by the peer reviewer. The FAAR stated that Petitioner billed for psychiatric services at an ACLF or an assisted living facility. Medicaid normally does not pay for such services. However, in this case, Respondent adjusted the claims to a domiciliary or custodial care visit. Sometime after Petitioner received the FAAR, Petitioner sent Respondent some additional patients' medical records. Some of the records were duplicates of documents that Petitioner previously had furnished to Respondent. Other records were for services that may have been provided during the audit period but which were not a part of the random sample because Medicaid did not pay for them during relevant time frame. Respondent requested Dr. James R. Edgar to conduct a second peer review of Petitioner's correspondence and patient records to determine the appropriate level of service. Respondent provided Dr. Edgar with a copy of the patients' medical records, a copy of Respondent's worksheets, including Dr. Agbunag's notes, and the appropriate policy handbooks. Respondent requested Dr. Edgar to make changes in the level of service as he deemed appropriate. Dr. Edgar performed his review between July 25, 2004, and July 29, 2004, making an independent determination regarding issues of medical necessity and level of care. Initially, as to every disputed paid claim, Dr. Edgar agreed with Dr. Agbunag that Petitioner's patient records were insufficient to justify the procedure code and higher level of service claimed by Petitioner. Specifically, Dr. Edgar presented persuasive evidence that a number of paid claims, which Petitioner billed under CPT codes 99215, 99223, 99232, 99233, and 99238, were properly adjusted to CPT code 90862. Petitioner was not entitled to bill at a higher level of reimbursement because he failed to adequately document as to history, examination, medical decision-making, and time. Dr. Edgar agreed that, upon reconsideration, Petitioner's claim for Recipient 14, date of service September 7, 1998, billed under CPT code 99238, was appropriate. As to Recipient 1, date of service March 9, 1999, Petitioner was not entitled to bill for services using CPT code 99255, initial inpatient consultation for a new or established patient. CPT code 99222, initial hospital care, per day, for the E/M of a new or established patient, was more appropriate because Petitioner provided the consultation for one of his established patients. His services included a comprehensive history, a comprehensive examination, and medical decision making of moderate complexity. An independent analysis of the selection of the random sample, the statistical formula used by Respondent, and the statistical calculation used to determine the overpayment, confirms the conclusions in the FAAR. The greater weight of the evidence indicates that Respondent properly extrapolated the results from the sample to the total population. Out of a population of 222 recipients and a population of 2,123 claims, 30 recipients selected at random with 282 paid claims capture most of the characteristics of the total population. In this case, the statistical evidence indicates that 29 of the 30 recipients had overpayments. The odds that 29 out of 30 randomly selected recipients would have overpayments, if no overpayments existed, are greater than the odds of winning the Florida Lotto Quick Pick three weeks in a row. In fact, within a statistical certainly, the amount claimed in this cause based on the records of 30 recipients is lower than the reimbursement amount that Petitioner would owe if all records were reviewed. Respondent incurred costs during the investigation of this matter. The amount of those costs was not known at the time of the formal hearing.
Recommendation Based on the forgoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That Respondent enter a final order finding that Petitioner owes Respondent for an overpayment in the amount of $39,055.34, less an adjustment for the September 7, 1998 claim for Recipient 14, plus interest. DONE AND ENTERED this 25th day of March, 2005, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 25th day of March, 2005. COPIES FURNISHED: Alan Levine, Secretary Agency for Health Care Administration Fort Knox Building III 2727 Mahan Drive, Suite 3116 Tallahassee, Florida 32308 Valda Clark Christian, General Counsel Agency for Health Care Administration Fort Know Building III 2727 Mahan Drive, Suite 3431 Tallahassee, Florida 32308 Debora E. Fridie, Esquire Agency for Health Care Administration Fort Knox Building III, Mail Station 3 2727 Mahan Drive, Suite 3431 Tallahassee, Florida 32308 John D. Buchanan, Jr., Esquire Henry, Buchanan, Hudson, Suber & Carter, P.A. 117 South Gadsden Street Post Office Box 1049 Tallahassee, Florida 32302
The Issue Whether Emergency Rule 10CER92-4 should be invalidated because it constitutes an invalid exercise of delegated legislative authority.
Findings Of Fact The Medicaid program is a program authorized under Title XIX of the federal Social Security Act that provides for payments for medical items or services for eligible recipients. Section 409.901(7), Florida Statutes. Prior to July 1, 1993, the Medicaid program was administered by the Department of Health and Rehabilitative Services (HRS). Effective July 1, 1993, Section 20.42, Florida Statutes, 1992 Supplement, was amended by Chapter 93-129, Section 58, Laws of Florida, to give the Agency for Health Care Administration (AHCA) the responsibility for the Medicaid program. The Medicaid program provides for mandatory and optional services to eligible recipients. Prescribed drug services are optional Medicaid services. Medicaid services may be provided only when medically necessary, must be provided in accordance with state and federal law, and are subject to any limitation established by the general appropriations act or Chapter 216, Florida Statutes. Sections 409.905 and 409.906, Florida Statutes. Medical providers participating in the Medicaid program receive reimbursement from Medicaid. Section 409.908, Florida Statutes. States are given the option to charge Medicaid recipients copayments for services. 42 CFR Section 447.50. Certain categories of services and recipients are exempt from copayments. 42 CFR Section 447.53. Forty-five percent of the Medicaid program is funded by state funds and fifty-five percent is funded with federal "matching funds." In order to receive federal matching funds for its Medicaid program, the state must submit a plan describing the nature and scope of its Medicaid program and giving assurances that the program will be administered in accordance with Title XIX and applicable federal regulations. This plan is known as the State plan. Effective February 14, 1992, the Legislature enacted Chapter 92-5, Laws of Florida, which amended the appropriations Act for fiscal year 1991-92. Proviso language in Chapter 92-5 relating to Specific Appropriation 1035 for Medicaid prescribed medicine/drug provides: The Department of Health and Rehabilitative Services is directed to implement, beginning April 1, 1992, a co-payment program for Prescribed Medicine in order to implement spending reductions of at least $770,213 from general revenue and $929,661 from the Medical Care Trust Fund in Specific Appropriation 1035. The State plan was amended effective April 10, 1992, to require a copayment of $1.00 per prescription for pharmacy services provided to Medicaid recipients. Certain categories of services and recipients were exempted from the copayment requirement. Providers were prohibited from denying services to recipients who were unable to pay the copayment. Prior to April 10, 1992, copayments had not been required for prescribed drug services. HRS adopted Emergency Rule 10CER92-4, effective April 10, 1992. HRS published notice of the emergency rule in the Florida Administrative Weekly, Vol. 18, No. 16, April 17, 1992. In this notice under the section entitled "SPECIFIC REASONS FOR FINDING AN IMMEDIATE DANGER TO THE PUBLIC HEALTH, SAFETY OR WELFARE," it states in pertinent part: The 1992 Legislature reduced the prescribed drug services program FY 1991-1992 budget in Senate Bill 2408 which was signed by the Governor on February 14, 1992. This law requires the Medicaid program to implement a copayment requirement for prescription drugs by April 1992. . . . The emergency rule amended Rule 10C-7.042, Florida Administrative Code and required recipients to pay the pharmacy provider a $1.00 co-payment for each prescription or other prescribed drug service reimbursed by Medicaid. Certain categories of recipients and services were exempted from the copayment requirement. The pharmacy provider was required to request a copayment from non-exempt recipients. The pharmacy must determine a recipient's ability to pay the copayment based on the recipient's reply to the request for copayment, the recipient's past purchase history with that provider, and the recipient's recent purchase of non-essential items. A provider could not deny prescribed drug services to eligible recipients because of inability to pay the copayment. Although a recipient may not be able to pay the copayment, the recipient remains liable for the copayment. HRS began the rulemaking process to adopt the same amendments to Rule 10C-7.042 as a regular rule. Emergency Rule 10CER92-4 was challenged via a lawsuit in state court and was later removed to federal court. The proposed amendments to Rule 10C-7.042 were challenged in an administrative rule challenge, which was withdrawn and added to the lawsuit in federal court dealing with the challenge to the emergency rule. Chapter 92-293, Laws of Florida, the Appropriations Act for fiscal year beginning July 1, 1992 and ending June 30, 1993 contains the following proviso language relating to Medicaid prescribed drug services: Funds in Specific Appropriation 1019 are reduced by $18,581,894 from the General Revenue Fund, $3,281,004 from the Grants and Donations Trust Fund, $22,647,089 from the Medical Care Trust Fund, $2,632,000 from the Public Medical Assistance Trust Fund, and $58,013 from the Special Grants Trust Fund for the Department to implement a Medicaid comprehensive cost containment program. This program shall, at a minimum, incorporate: a prior authorization component; a co-payment program; an on site education program for providers prescribing the drugs; enhancements to the Department's ability to identify fraud and abuse; utilization of specific nursing home pharmacy consultants; and, shall implement new electronic technology to speed payments and capture third party liability information. By notice in the Florida Administrative Weekly, Rule 10CER92-4 has been continued pursuant to Section 120.54(9)(c), Florida Statutes. Chapter 93-184, Laws of Florida, the Appropriations Act for the fiscal year beginning July 1, 1993 and ending June 30, 1994, contains no language concerning reductions in the appropriations for Medicaid prescription medicine services and contains no language concerning copayments for recipients receiving Medicaid prescription medicine services. The amounts appropriated for the Medicaid prescription medicine services was at or below the amounts appropriated in Chapter 92-293 Laws of Florida. Chapter 93-129, Section 48, Laws of Florida, created section 409.9081, Florida Statutes, which requires Medicaid recipients to pay nominal copayments for hospital outpatient services and physician services effective July 1, 1993. Prior to the enactment of section 409.9081, Florida Statutes, a one dollar copayment had been required for Medicaid outpatient hospital and physician service. Effective July 1, 1993, the copayments were raised to two dollars. Current revenues generated by the copayments for the Medicaid prescribed drug services is approximately $12 million. Thus, the discontinuance of the copayment would result in a $12 million shortfall for the provision of Medicaid prescribed drug services, and a restriction on services to the extent necessary to account for the shortfall. The Social Services Estimating Conference (SSEC) is a statutorily created body established to develop official information relating to the social service system of the state for use in the state planning and budgeting system. Section 216.136(6), Florida Statutes. Section 216.134(1), Florida Statutes, provides in pertinent part: Unless otherwise provided by law or decided by unanimous agreement of the principals of the conference, all official information developed by the conference shall be based on the assumption that current law and current administrative practices will remain in effect throughout the period for which the official information is to be used. . . . The social services estimating conference for 1993-94 took into consideration the revenues from the copayments for the Medicaid prescribed drug services. Petitioner, Mildred Henry, resides in Jacksonville, Florida, and is disabled. She has received Medicaid since December, 1991. Her only income is Supplemental Income ("SSI") benefits of $434 per month. Ms. Henry suffers from many disabilities including chronic obstructive pulmonary disease, asthma, hypertension, severe and chronic urinary tract infections, and depression. Her physicians have prescribed a number of medications to address these conditions including Cardizem (for high blood pressure), Zantac (for ulcers), Cipro (for chronic urinary tract infections), Phenazopyridine (for bladder problems), Imipramine (for depression), Premarin (hormone), Thes-dur (for asthma), Brethine (for asthma), Ventalin (for asthma), Furosemide (for excess fluid), K-Dur (potassium), Propoxy N (for pain), Nizoral (for skin irritations), Darvoset (for pain), Tylenol 3 (for pain), and Halcion (for anxiety). She needs to refill most of these prescriptions each month. Copayments for all of Ms. Henry's prescription medications amount to $16.00. Ms. Henry's income is below the federal poverty level. She cannot afford to pay a copayment for all her medications. Petitioner has informed her pharmacy that she does not have the money to pay copayments. However, the pharmacy has refused to provide the medications without payment of the co-payments. As a result, Petitioner runs out of medications and delays getting her prescriptions refilled until she can pay the copayment.
Conclusions This cause came before the Agency for Health Care Administration for issuance of a Final Order. 1. On March 26, 2013, the Agency sent a letter to the Petitioner notifying the Petitioner that it owed an overpayment in the amount of $565,279.55 to the Agency based upon an adjustment in the Petitioner’s overpayment rates (Exhibit A). 2. On April 16, 2013, the Petitioner filed a Petition for Formal Hearing and the Agency Clerk referred the Petition for Formal Hearing to the Division of Administrative Hearings for further proceedings. 4. On May 13, 2013, the Administrative Law Judge assigned to the case entered an Order Closing File and Relinquishing Jurisdiction based upon a Joint Motion to Relinquish Jurisdiction filed by the parties. 5. On May 23, 2014, the Agency rescinded the overpayment letter (Exhibit B). 6. The Agency’s rescission of the overpayment letter has rendered this matter moot. Filed August 14, 2014 9:26 AM Division of Administrative Hearings Based on the foregoing, IT IS THEREFORE ORDERED AND ADJUDGED THAT: Respondent’s right to a hearing in this matter has been rendered moot and the Agency’s May 11, 2013 overpayment letter is rescinded. The parties shall govern themselves accordingly. DONE AND ORDERED this S day of Novurt , 2014 in Tallahassee, Leon County, Florida. K ELIZABETH DUDEK, SECRETARY AGENCY FOR HEALTH CARE ADMINISTRATION
The Issue The issue in this case is whether the provider, Orietta Medical Equipment, Inc., d/b/a Pharmco Pharmacy (Respondent or Provider) should repay an alleged Medicaid overpayment and, if so, in what amount. The Petitioner’s Final Agency Audit Report (FAAR) claims the Provider must repay $486,879.06.
Findings Of Fact The Petitioner is the state agency charged with the responsibility of administering the Medicaid Program in Florida. As such, the Petitioner monitors payments to Medicaid providers and seeks to recover reimbursements when an overpayment is claimed. At all times material to the allegations of this case, the Respondent was a licensed pharmacy and was designated a “provider” of Medicaid pharmacy services pursuant to its provider agreement with the Petitioner. As a provider of Medicaid pharmacy services, the Respondent was authorized to dispense drugs to Medicaid recipients and to bill the Medicaid Program for the expenses associated with such pharmacy services. The Petitioner may, after-the-fact, seek to verify the claims paid for Medicaid recipients. This “pay and chase” methodology presumes that the Provider will maintain appropriate documentation to support the paid claims. When the Agency audits a provider, records supporting the claims paid must be produced. In this case, the Petitioner elected to perform an “invoice audit” for the audit period June 2, 2003 through May 28, 2004. The Agency sought to review the Provider’s drug acquisition records for the same drugs that were dispensed to Medicaid recipients. The paid claims should compare to the drugs acquired and held in inventory for the subject period of time. After performing a Provisional Agency Audit Report (PAAR) detailing an alleged overpayment, the Provider was notified of the audit results and was provided a spreadsheet of the work papers that detailed the overpayment claim. The Provider was given an opportunity to provide additional documentation to support the Medicaid claims and to establish the inventory to support its claims. After an additional review of the Provider's information, the Agency issued its FAAR dated February 2, 2005, which claimed a Medicaid overpayment in the amount of $486,879.06. This amount has not been repaid to the Petitioner. Instead, the Provider disputed the amount of the overpayment and requested an administrative proceeding. That request was timely submitted. All of the audit results were provided to the Provider at the time of the issuance of the FAAR and were, in fact, attached to the request for hearing submitted by the Provider on or about February 7, 2005. Florida Medicaid providers are required by their agreements with the state to comply with the Florida Medicaid Prescribed Drug Services Coverage, Limitations, and Reimbursement Handbook (the handbook). The handbook is furnished to providers and is also available on-line. The handbook outlines requirements for record keeping, as well as other pertinent information to assist providers. In this case, the Provider was obligated to maintain records to support the Medicaid claims paid by the State. The Agency contracted with Heritage Information Systems, Inc., to conduct the audit in this case. Auditors went to the Provider’s business location in Hialeah, Florida, to analyze the Respondent’s business records. More specifically, the auditors sought the records from the Provider to show that it had acquired sufficient inventory of the specific drugs for which claims had been paid during the audit period. It stands to reason that the drug inventory on hand for the Provider had to exceed the drugs dispensed during the audit period (presumably some of the Provider’s patients were not Medicaid recipients). In fact, in this case, the Provider could not produce inventory records to support the claims paid for the audit period. As the records did not support the claims, the Agency deemed the claims to be overpayments. As such, the Agency maintains the Provider was, under the terms of the guidelines set forth in the handbook, required to reimburse the Petitioner for the overpayment. To compute the overpayment the Agency used a methodology that established the use rate of the product for the audit period. For example, for the drug Acetylcysteine the Medicaid recipient use rate for the audit period was 97.27 percent. Applying this percentage to the units purchased for the audit period would establish the expected claims. Therefore, since the Respondent purchased 16,890 units of this drug, the number of units billed would be expected to be 97.27 percent (the Medicaid use rate) of that amount. Instead, the claims for this drug for the audit period totaled 96,120-- a difference of 79,691 units. The difference (79,691) must then be multiplied by the drug's $.56 cost to show an apparent overcharge in the amount of $44,626.96 for this drug. The Agency applied the same methodology described above for 20 different drugs that were billed during the audit period. The total overcharge for these drugs was $486,879.06. The Respondent presented no evidence to refute the audit findings. No acquisition records were produced to reduce the calculated overpayment. That is to say, no purchase records could demonstrate that the Provider had on hand the number of units of the drugs billed to Medicaid. The Respondent has not disputed that the pharmacy was a provider, was subject to the handbook and pertinent guidelines, was required to maintain records to support the claims, and was paid for claims submitted to the Agency. Moreover, the Respondent does not dispute that the audit, the audit work papers, and the spreadsheets describing the methodology used to compute the overpayment were provided to the Provider more than 14 days prior to the hearing. It claims the trial book of exhibits was not provided 14 days prior to the hearing date. The hearing in this cause was originally scheduled for two days, to commence on August 15, 2006. The Agency provided a trial book of its exhibits to the Respondent on or about 4:00 p.m., August 1, 2006. The Respondent maintains that all evidence presented by the Agency in this cause must be excluded pursuant to Section 409.913(22), Florida Statutes (2005).
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Agency for Health Care Administration enter a Final Order sustaining the Medicaid overpayment in the amount of $486,879.06. DONE AND ENTERED this 1st day of December, 2006, in Tallahassee, Leon County, Florida. S J. D. PARRISH Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 1st day of December, 2006. COPIES FURNISHED: Richard J. Shoop, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 William Roberts, Acting General Counsel Agency for Health Care Administration Fort Knox Building, Suite 3431 2727 Mahan Drive, Mail Stop 3 Tallahassee, Florida 32308 Christa Calamas, Secretary Agency for Health Care Administration Fort Knox Building, Suite 3116 2727 Mahan Drive Tallahassee, Florida 32308 David W. Nam, Esquire Agency for Health Care Administration Fort Knox Building, Mail Station 3 2727 Mahan Drive, Suite 3431 Tallahassee, Florida 32308 William M. Furlow, III, Esquire Akerman Senterfitt Highpoint Center, Suite 1200 106 East College Avenue Tallahassee, Florida 32301
The Issue Whether the Petitioner must reimburse the Respondent for Medicaid overpayments as set out in the Amended Final Agency Audit Report dated November 13, 2000, and, if so, the amount to be repaid.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: The Agency is the state agency responsible for the administration of the Medicaid program in Florida, and, as one of its duties, the Agency is charged with recovering overpayments made to Medicaid providers. Section 409.913, Florida Statutes (2000). At all times material to this proceeding, Peripheral Medical Services provided durable medical equipment and home health services to Medicaid recipients in Florida pursuant to a contract with the Agency, and it was assigned Medicaid provider number 950348000.2 The Medicaid Provider Agreement entered into by Peripheral Medical Services provides in pertinent part: The Provider agrees to participate in the Florida Medicaid program under the following terms and conditions: * * * (5) The Medicaid provider shall: * * * (b) Keep and maintain in a systematic and orderly manner all medical and Medicaid related records as the Agency may require and as it determines necessary; make available for state and federal audits for five years, complete and accurate medical, business, and fiscal records that fully justify and disclose the extent of the goods and services rendered and billings made under the Medicaid program. The provider agrees that only contemporaneously made records of goods and services provided will be admissible in evidence in any proceeding relating to payment for or provision of services for the purpose of supporting any claim submitted to or paid by the Medicaid program. After the Agency received a routine report from its Medicaid Program Office located in Miami, Florida, the Agency conducted an audit of the claims submitted by Peripheral Medical Services for the 27 Medicaid recipients to whom it provided oxygen durable medical equipment and services during the audit period extending from August 5, 1996, to July 6, 1998. Pursuant to certificates of medical necessity, Peripheral Medical Services provided each of the 27 Medicaid recipients with an oxygen concentrator during the audit period, and it submitted Medicaid claims for monthly visits to each of these patients. During the period of time covered by the audit, Peripheral Medical Services received payments for services provided to the 27 Medicaid recipients in an amount totaling $76,926.74. Peripheral Medical Services maintained patient records for these 27 Medicaid recipients, and, during the audit, it provided the Agency with the patient records as documentation to support the claims. At the times material to this proceeding, the DME/Medical Supply Services Coverage and Limitations Handbook governing "Oxygen and Oxygen Related Equipment" provided in pertinent part: "Monthly Home Visit Requirements: When the CRTT, RRT or RN conducts a home visit, the following information about the recipient's condition and the condition of the equipment must be documented in the recipient's record: . . . the monthly checks of the operation and safety of the equipment." The Agency's inspector compared the patient records to the list of claims submitted by Peripheral Medical Services for which it received payment from Medicaid, and he reached the following conclusions, which were memorialized in the audit work papers and the summary report he prepared: Peripheral Medical Services made 21 claims for payment for monthly visits to patient M.C., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at 14 of the visits; $3,639.90 of the $6,106.80 paid by Medicaid was not supported by documentation. Peripheral Medical Services made 12 claims for payment for monthly visits to patient C.M., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at eight of the visits; $2,498.20 of the $3,747.30 paid by Medicaid was not supported by documentation. Peripheral Medical Services made 14 claims for payment for monthly visits to patient J.P-O., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at eight of the visits; $2,498.20 of the $4,340.55 paid by Medicaid was not supported by documentation. Peripheral Medical Services made 13 claims for payment for monthly visits to patient F.A., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at eight of the visits; $2,361.63 of the $3,915.18 paid by Medicaid was not supported by documentation. Peripheral Medical Services made 20 claims for payment for monthly visits to patient N.V., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at 12 of the visits; $3,595.18 of the $6,061.98 paid by Medicaid was not supported by documentation. Peripheral Medical Services made ten claims for payment for monthly visits to patient M.P., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at six of the visits; $1,325.22 of the $2,270.36 paid by Medicaid was not supported by documentation. Peripheral Medical Services made one claim for payment for a monthly visit to patient M.A., and it provided documentation establishing that a check of the operation and safety of the oxygen concentrators was performed at this visit; the payment made by Medicaid was supported by documentation. Peripheral Medical Services made one claim for payment for a monthly visit to patient M.B., and it provided documentation establishing that a check of the operation and safety of the oxygen concentrators was performed at this visit; the payment made by Medicaid was supported by documentation. Peripheral Medical Services made 21 claims for payment for monthly visits to patient R.Q., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at 15 of the visits; $4,172.69 of the $6,015.04 paid by Medicaid was not supported by documentation. Peripheral Medical Services made 19 claims for payment for monthly visits to patient M.P., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at 12 of the visits; $3,975.64 of the $5,833.64 paid by Medicaid was not supported by documentation. Peripheral Medical Services made 11 claims for payment for monthly visits to patient E.D., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at six of the visits; $1,813.19 of the $3,366.74 paid by Medicaid was not supported by documentation. Peripheral Medical Services made 15 claims for payment for monthly visits to patient I.S., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at ten of the visits; $2,679.60 of the $4,233.15 paid by Medicaid was not supported by documentation. Peripheral Medical Services made five claims for payment for monthly visits to patient R.G., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at any of the visits; the entire $1,522.25 paid by Medicaid was not supported by documentation. Peripheral Medical Services made one claim for payment for a monthly visit to patient R.B., and it provided documentation establishing that a check of the operation and safety of the oxygen concentrators was performed at this visit; the payment made by Medicaid was supported by documentation. Peripheral Medical Services made two claims for payment for monthly visits to patient A.A., but it failed to provide documentation establishing that a check of the operation and safety of the oxygen concentrators was performed at one of the visits; $320.10 of the $640.20 paid by Medicaid was not supported by documentation. Peripheral Medical Services made one claim for payment for a monthly visit to patient L.B., and it provided documentation establishing that a check of the operation and safety of the oxygen concentrators was performed at this visit; the payment made by Medicaid was supported by documentation. Peripheral Medical Services made 20 claims for payment for monthly visits to patient D.C., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at 14 of the visits; $3,868.24 of the $5,726.24 paid by Medicaid was not supported by documentation. Peripheral Medical Services made one claim for payment for a monthly visit to patient D.M., and it provided documentation establishing that a check of the operation and safety of the oxygen concentrators was performed at this visit; the payment made by Medicaid was supported by documentation. Peripheral Medical Services made one claim for payment for a monthly visit to patient K.R., and it provided documentation establishing that a check of the operation and safety of the oxygen concentrators was performed at this visit; the payment made by Medicaid was supported by documentation. Peripheral Medical Services made 16 claims for payment for monthly visits to patient D.G., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at ten of the visits; $2,954.88 of the $4,812.88 paid by Medicaid was not supported by documentation. Peripheral Medical Services made 23 claims for payment for monthly visits to patient M.V., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at 15 of the visits; $4,172.69 of the $6,639.59 paid by Medicaid was not supported by documentation. Peripheral Medical Services made one claim for payment for a monthly visit to patient L.F., and it provided documentation establishing that a check of the operation and safety of the oxygen concentrators was performed at this visit; the payment made by Medicaid was supported by documentation. Peripheral Medical Services made six claims for payment for monthly visits to patient R.N., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at any of the visits; the entire $1,920.60 paid by Medicaid was not supported by documentation. Peripheral Medical Services made 22 claims for payment for monthly visits to patient T.P., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at 15 of the visits; $4,172.69 of the $6,335.14 paid by Medicaid was not supported by documentation. Peripheral Medical Services made nine claims for payment for monthly visits to patient A.V., but it failed to provide documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at eight of the visits; $1,889.30 of the $2,102.70 paid by Medicaid was not supported by documentation. Peripheral Medical Services made two claims for payment for monthly visits to patient R.P., and it provided documentation establishing that checks of the operation and safety of the oxygen concentrators were performed at these visits; the payments made by Medicaid were supported by documentation. aa. Peripheral Medical Services made one claim for payment for a monthly visit to patient E.R., and it provided documentation establishing that a check of the operation and safety of the oxygen concentrators was performed at this visit; the payment made by Medicaid was supported by documentation. The patient records provided by Peripheral Medical Services do not contain documentation that the required operation and safety checks were performed in the months identified by the Agency in its audit work papers, and the Agency's calculations of the amounts paid by Medicaid that are subject to recoupment are supported by the summary report prepared by the Agency's inspector, as well as by the Agency's summary report. Peripheral Medical Services received payments totalling $49,380.20 from Medicaid on claims not supported by documentation.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Agency for Health Care Administration enter a final order finding that Peripheral Medical Services, Inc., was overpaid for services provided to Medicaid recipients for the audit period extending from August 5, 1996, to July 6, 1998, and requiring Peripheral Medical Services, Inc., to repay the Agency for Health Care Administration the principal amount of $49,380.20. DONE AND ENTERED this 8th day of November, 2001, in Tallahassee, Leon County, Florida. PATRICIA HART MALONO 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 8th day of November, 2001.
