Findings Of Fact 1. The initial action of HRS in regard to the application of Home Health Care of Bay's application for a CON, as set forth in the State Agency Action Report (SAAR), was to deny the application. 2. The SAAR, dated April 29, 1987, together with a cover letter dated April 30, 1987, advised Home Health Care of Bay that its application has been denied because "[t]here was no need demonstrated by Home Health Care of Bay for an additional home health agency in Bay County." These two documents further advised Home Health Care of Bay of its point of entry into Chapter 120, Florida Statutes. 3. Home Health Care of Bay availed itself of this point of entry by filing a reguest for a formal hearing pursuant to Section 120.57(1) on the initial decision to deny its application. 4. Home Health Care of Bay is a for-profit corporation under the laws of Florida, having been incorporated on December 10, 1986, prior to the SAAR and the initial denial letter. 5. Home Health Care of Bay has had its principal office in the State of Florida since its incorporation. 6. Home Health Care of Bay does not have and has never had more than 25 full-time employees. 7. At the time of its CON application and of the initial denial by HRS, Home Health Care of Bay had assets of $1,000, which was received from issuance of 1,000 shares of stock at $1.00 per share, and a note receivable of $21,600. The total net worth of Home Health Care of Bay at the time this action was initiated was $22,600. 8. By its response to Request for Admission 1 and its stipulation at hearing, HRS has stipulated that Home Health Care of Bay incurred attorneys' fees and associated costs in DOAH Case No. 87-2151 equal to $15,000 and that said fees and costs are reasonable. It is so found. 9. Following a formal hearing in DOAH Case No. 87- 2151, a Recommended Order was entered on December 17, 1987, recommending granting of the CON. A Final Order was entered by HRS on February 15, 1988. HRS adopted all of the Findings of Fact in the Recommended Order. HRS granted certain exceptions to the Conclusions of Law. Specifically, HRS granted exceptions as to the conclusions that its reliance on the statutory criteria is "nebulous," that its failure to establish a need methodology is arbitrary and capricious, that it was requiring applicants to prove "unmet need," and that the Hearing Officer relied in part on a need methodology abandoned by HRS. 10. HRS granted the requested CON to Home Health Care of Bay by this Final Order. 11. Findings of Fact in that Recommended Order, which were adopted by HRS, included findings that: A. HRS abandoned its "interim policy" regarding use of a need methodology in home health agency applications in late 1986. (Finding of Fact 56). B. HRS informed applicants that it had abandoned the interim policy only after applications were filed in the second batching cycle of 1986. (Finding of Fact 57). C. Applicants in this December, 1986, batching cycle, including Home Health Care of Bay, were asked for an unlimited extension of time within which HRS could render a decision. (Finding of Fact 58). D. Applicants who refuse to agree to an extension were evaluated on the basis of the "statutory need criteria." Applicants who did not agree to an extension were denied. (Finding of Fact 59). E. The new "policy" used by HRS to evaluate these applications (the ones who refused to grant extensions) put the burden of proof on the applicant to demonstrate an unmet need. Such a demonstration would be difficult to make. (Finding of Fact 62). F. HRS reviewed Home Health Care of Bay's application using the new "policy" based on the "thirteen statutory criteria." Such a review required Home Health Care of Bay to prove need by demonstrating an unmet need. (Finding of Fact 63). G. As evidenced by HRS' review of Home Health Care of Bay's application, a policy requiring an applicant to meet a negative burden of proof is unreasonable. It imposes a standard which is e for an applicant to meet. (Finding of Fact). 12. Fig in the Recommended Order set forth extensive the standard used by HRS to review the application Health Care of Bay and the reasons why the review was deficient and the determination to deny the application was flawed. 13. One Conclusion of Law which HRS did not reverse is that found on page 35 of the Recommended Order in the second full paragraph: Further, DHRS' preliminary decision had no reasonable basis in law or fact at the time it was made. It is this same preliminary decision which was set forth in the SAAR and which constituted the initial decision from which Home Health Care of Bay had a point of entry into Chapter 120 proceedings. 14. In attempting to justify its actions, HRS presented the testimony of Sharon Gordon-Girvin. Ms. Gordon-Girvin had no part in or knowledge of the initial decision of HRS to deny this application. Instead, shortly before and in preparation for the formal hearing in DOAH Case No. 87-2151, Ms. Gordon- Girvin reviewed the SAAR and the initial decision and agreed with HRS' counsel not to enter into a settlement with Home Health Care of Bay. Her testimony regarding the basis for and correctness of the initial denial is rejected as being irrelevant to the question of whether HRS had a reasonable basis in law and in fact at the time it initially denied the application. Additional, such after-the-fact rationalization and justification for HRS' actions is so self- serving as to merit little weight. 15. HRS failed to prove that its initial denial was reasonable in DOAH Case No. 87-2151 and it failed to prove in this case that there was any reasonable basis for its initial denial. 16. HRS did present evidence that Home Health Care of Bay may be able to recover some of its fees and costs through Medicare reimbursements amortized over at least five (5) years. However, the evidence was speculative and uncertain, and HRS did not offer evidence that Home Health Care of Bay will recover any or all of its fees and costs through Medicare reimbursements.
Conclusions Having reviewed the Administrative Complaint dated September 27, 2010, attached hereto and incorporated herein (Ex. 1), and all other matters of record, the Agency for Health Care Administration (“Agency”) has entered into a Settlement Agreement (Ex. 2) with the parties to these proceedings, and being well advised in the premises, finds and concludes as follows: ORDERED: 1. The attached Settlement Agreement is approved and adopted as part of this Final Order, and the parties are directed to comply with the terms of the Settlement Agreement. 2. The Respondent shall pay, within thirty (30) days of the date of rendition of this Order, an administrative fine of one thousand dollars ($1,000.00) and a survey fee of five hundred dollars ($500.00) for a total of one thousand five hundred dollars ($1,500.00) to the Agency. 1 Filed January 14, 2011 QJ Division of Administrative Hearings 3. Checks should be made payable to the “Agency for Health Care Administration.” The check, along with a reference to this case number, should be sent directly to: Agency for Health Care Administration Office of Finance and Accounting Revenue Management Unit 2727 Mahan Drive, MS #14 Tallahassee, Florida 32308 4. Unpaid amounts pursuant to this Order will be subject to statutory interest and may be collected by all methods legally available. 5. Each party shall bear its own costs and attorney’s fees. 6. The Respondent’s petition for formal administrative proceedings is hereby withdrawn. 7. The above-styled case is hereby closed. DONE and ORDERED this |) day of es , 2019, in Tallahassee, Leon County, Florida. {, Interim Secretary alth Care Administration A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A SECOND COPY, ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW OF PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED. Copies furnished to: John D. Ellis, Esq. Attorney for Respondent Balmy Beach Retirement Home, Inc. P.O. Box 1161 Orlando, Florida 32801 James H. Harris, Assistant General Counsel Agency for Health Care Admin. Office of the General Counsel 525 Mirror Lake Drive North, #330D (U.S. Mail) St. Petersburg, Florida 33701 Interoffice Mail) Jan Mills Agency for Health Care Admin. - Agency for Health Care Admin. 2727 Mahan Drive, Bldg #3, MS #3 Tallahassee, Florida 32308 (Interoffice Mail) Office of Finance and Accounting Revenue Management Unit 2727 Mahan Drive, MS #14 Tallahassee, Florida 32308 Bruce McKibben Administrative Law Judge Division of Administrative Hearings The Desoto building 1230 Apalahcee Parkway Tallahassee, Florida 32399-3060 (Electronic Mail) Perce ne Mail) CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of this Final Order was served on the above-named person(s) and entities by U.S. Mail, or the sa method designated, on this the IZ day of Richard Shoop, Agency Clerk ey Agency for Health Care Administration 2727 Mahan Drive, Building #3 Tallahassee, Florida 32308-5403 (850) 412-3630
The Issue The issues for determination are whether Respondent committed the offenses set forth in the Administrative Complaints and, if so, what penalty should be imposed; and whether Respondent should be issued a Standard or Conditional license rating.
Findings Of Fact At all times material hereto, Respondent was a licensed nursing home located in Pompano Beach, Florida. Petitioner is charged with, among other things, periodically evaluating nursing home facilities and making a determination as to the degree of compliance with applicable federal regulations, and state statutes and rules. The evaluation or survey of a facility includes a resident review or survey. A resident survey consists of record review, resident observation, and interviews with family and facility staff. Review of a clinical record includes the review of a document referred to as minimum data set or MDS Assessment. The MDS Assessment is a record, in summary fashion, of information or data that a facility gathers to prepare a care plan for a resident. During the survey of a facility, if violations of regulations are found, the violations are noted and referred to as "tags." Petitioner's surveyors document the tags on a form prepared by Petitioner. Petitioner's surveyors use the "State Operations' Manual" (SOM) as guidance in determining whether a facility has violated the federal regulation 42 CFR Chapter 483. The October 1998 Survey On October 8-9, 1998, Petitioner conducted an appraisal survey of Respondent, which is not a full survey. In an appraisal survey, Petitioner's focus is on quality of care issues, making sure that the quality of care standards are met. Petitioner used nursing home survey protocols prescribed by the federal government. Petitioner's surveyor performed a resident review of Resident No. 5. Tag F309 Tag F309 incorporates the requirement of federal regulation 42 CFR Subsection 483.25, which provides that "each resident must receive and the facility must provide the necessary care and services to attain or maintain the highest practicable physical, mental, and psychosocial well-being, in accordance with the comprehensive assessment and plan of care." The SOM provided, regarding 42 CFR Section 483.25, that a facility must ensure that its residents obtain optimal improvement or does not deteriorate. Therefore, the surveyor must first determine whether a resident has declined or optimally improved, and if the resident has suffered a decline or lack of improvement, determine whether the decline or lack of improvement was avoidable or unavoidable. A decline or failure to reach the highest practicable well-being is unavoidable only if: (1) the facility has an accurate and complete assessment; the facility has a care plan which is consistently implemented and based on the assessment; and (3) the facility has an evaluation of the results of the interventions and revising the interventions when necessary. Resident No. 5 was admitted to Respondent on July 9, 1998. The diagnosis for Resident No. 5 included dementia, but not severe because he could understand and follow directives, aggressive behavior, and agitated depression. He used a wheelchair and could ambulate with assistance. Respondent was required within 14 days, by July 23, 1998, to complete a MDS Assessment of Resident No. 5. Respondent assessed Resident No. 5 as being at risk for falls. Respondent was required within 21 days, by July 30, 1998, to develop a comprehensive care plan to address Resident No. 5's risk for falls. On July 29, 1998, Respondent completed and implemented the comprehensive care plan, containing interventions which included encouraging Resident No. 5 to use his call light; counseling him about his risk for falls and the need to request assistance in transfers; assisting him with transfers; instructing him about proper transfer techniques; using a night light; monitoring him for fatigue; and providing proper positioning while he was in bed or in a chair. Petitioner's surveyor reviewed, among other things, the nurses' notes and the care plan for Resident No. 5. The surveyor determined that Resident No. 5 had fallen seven times since his admission: July 18, July 23, August 7, August 14, August 17, September 26, and October 5, 1998. Two of Resident No. 5's falls occurred during the period for his MDS Assessment: July 18 and 23, 1998. Resident No. 5 suffered a skin tear to his elbow from the fall on August 14, 1998. On August 11, 1998, after his third fall on August 7, 1998, a wheelchair alarm was initiated to reduce the risk of falls. After Resident No. 5's fall on August 17, 1998, Respondent obtained an order for a lap tray. On September 28, 1998, after his sixth fall on September 26, 1998, a physical therapy screen was performed and a lap buddy was to be used in conjunction with the wheelchair alarm to reduce the risk of falls. The wheelchair alarm was to be used when the lap buddy was not in use. During the October survey, which was only three to four days after Resident No. 5's most recent fall, Petitioner's surveyor observed on two occasions that Resident No. 5 was without either a wheelchair alarm or a lap buddy. Before using the lap buddy, Resident No. 5 used a lap tray. He did not want to give-up the lap tray. Even when he was informed that the lap tray was restrictive, Resident No. 5 wanted to continue using the lap tray. A wheelchair alarm is a device, which attaches to a resident's wheelchair and is connected to the resident by a string. When the resident stands or otherwise moves from the wheelchair, the alarm sounds. The alarm's primary function is to alert the staff, not to ensure that falls will not occur, but the alarm's function is also an inhibitor and assists the staff to prevent the resident from causing himself or herself to fall. The wheelchair alarm is used only when there is a clearly demonstrated need. A lap buddy is much more restrictive than the wheelchair alarm. The lap buddy is a pillow-like device that rests in the resident's lap and discourages the resident from getting up, but the lap buddy can be removed by the resident. A more restrictive device than the lap buddy is the lap tray. The lap tray is a thin plywood board that is placed across the arms of the wheelchair and is secured to the wheelchair. The resident is capable of sliding underneath the lap tray and getting out of the wheelchair. In addition to the skin tear that Resident No. 5 suffered in his third fall on August 14, 1998, he experienced a decline in mobility requiring two people for assistance in walking instead of one person as he had before the many falls. Even though Resident No. 5 had a decline in his mental status as he had to begin taking a medication again that he stopped taking, the evidence does not demonstrate that the falls caused the decline in his mental status. Respondent failed to develop a care plan expeditiously and timely in order to address Resident No. 5's risk for falling. No evidence was presented to demonstrate that Resident No. 5 was resistant to using the interventions. Respondent had no documentation showing that the wheelchair alarm was sounding or in place at the time of Resident No. 5's fifth fall on August 17, 1998. Respondent had no documentation showing that the wheelchair alarm was in consistent use. Such documentation would have indicated that the care plan was being implemented. Respondent had no documentation showing that Resident No. 5 removed either the lap tray or lap buddy. When he fell on October 5, 1998, his seventh fall, the intervention for Resident No. 5 was the lap tray. The documentation showed that the lap tray had to be re-secured. An inference is drawn and a finding of fact is made that the lap tray was not in place when Resident No. 5 fell and that, therefore, the intervention was not consistently used. The evidence demonstrates that Respondent evaluated the results of the interventions which were used with Resident No. 5 and that Respondent revised the interventions as necessary. However, the evidence also demonstrates that the interventions were not consistently implemented. The evidence, in totality, demonstrates that Resident No. 5's decline was avoidable. Petitioner cited Respondent for committing a violation of Tag F309 and classified the violation as a Class II deficiency. Further, Petitioner assigned a federal scope and severity rating of "G" to the Tag F309 deficiency. Corrective Action After the October survey, Respondent was required to submit a plan of correction regarding Tag F309. Respondent submitted the plan of correction, indicating corrective action by October 10, 1998. The deficiency was corrected on October 10, 1998. Penalty Based upon the Class II deficiency of Tag F309, Petitioner imposed a fine of $5,000 upon Respondent. The April 1999 Survey On April 19-21, 1999, Petitioner conducted an annual survey of Respondent. An annual survey is performed at least once every 15 months. Again, the SOM was used by Petitioner's surveyors. Decisions, regarding violations, are made by the survey team. One surveyor is responsible for the resident review of a particular resident. Resident No. 3 Petitioner's resident surveyor reviewed documents and information, regarding Resident No. 3, including hospice care plan and social service notes; nurses' notes; physician orders; nurses' treatment notes; medication records; physician progress notes; comprehensive care plan, monthly summary comments; dietician's assessment; nutritional assessment; and the SOM for the pertinent tags. Petitioner's resident surveyor also made personal observations, interviewed staff, and had a consultation with a registered dietician, who was Petitioner's consultant. The survey team leader conducted the family interview. On December 10, 1998, Resident No. 3 was admitted to Respondent's facility from an acute care hospice facility. She was terminally ill and doctors were of the opinion that her clinical conditions would cause her death within six months. As a result, Resident No. 3 remained on hospice care at Respondent's facility. Resident No. 3 suffered from end-stage cardiovascular disease and congestive heart failure. She was incontinent with an indwelling Foley catheter and had contractures of the legs and Parkinson's disease. As a result of a stroke, Resident No. 3 was without speech. She was being fed through a PEG tube, which was inserted into her abdomen. Medication and hydration was also provided to her through the PEG tube. Resident No. 3 had several decubiti (pressure sores) at various stages of severity, including one at Stage IV and two at Stage III. She was receiving a continuous dose of morphine for pain caused by her compromising conditions. Resident No. 3 required total and complete assistance with all her activities of daily living (ADLs). She was completely dependent. The family of Resident No. 3 made the health care decisions for her, in particular, her son. Regarding the pressure sores, a Stage IV pressure sore had gone completely through the skin and muscle down to the bone, with nerve endings exposed. The pressure sore was open, raw, and very painful. Often the pain of such a pressure sore is described as being like very severe sun burns or almost like a bone racking kind of pain. In treating pressure sores, nutrition is one of the key components and one of the most important aspects of healing them. Development of pressure sores is related to malnutrition. During Resident No. 3's stay at the acute care hospice facility, before being admitted to Respondent's facility, Resident No. 3 experienced fluid build-up in her lungs, which was related to her end-stage cardiovascular disease and congestive heart failure. The hospice facility effectively eliminated the fluid build-up by reducing the amount of fluid intake to one can per day, which provided Resident No. 3 with 240 calories per day. For most healthy adults, 240 calories per day is insufficient to maintain body weight or promote healing of wounds or diseases. Resident No. 3's overall condition stabilized on the 240 calories per day. Upon admission to Respondent on December 10, 1998, a nutritional assessment of Resident No. 3's nutrition needs was performed by Respondent's dietician. A determination was made that, in order to meet her nutritional needs and promote weight gain and healing of her pressure sores, Resident No. 3 required 1,424 calories per day and between 37 and 56 grams of protein per day, in addition to multivitamins, vitamin C, zinc, and iron. In January 1999, Respondent's dietician reassessed Resident No. 3 for her nutritional needs. The dietician determined that no change existed in the nutritional needs for Resident No. 3, and recommended an additional, but slight, increase in the feeding amount. Around mid-January 1999, after the nutritional assessment, Resident No. 3 went into crisis care. While in crisis care, Resident No. 3's family expressed concern that she was receiving too much fluid through her feeding. Resident No. 3's physician ordered a reduction in her tube feeding to 720 calories (720 cc) per day, from six cans to three cans of formula per day. On January 25, 1999, Resident No. 3's family again expressed concern that she was receiving too much fluid through her tube feeding. The next day, Respondent's dietician and the hospice nurse met to discuss Resident No. 3's situation regarding the tube feeding. The hospice nurse informed Respondent's dietician that, during Resident No. 3's acute care at the hospice center, Resident No. 3 had experienced increased congestion and her tube feeding had been reduced to one can of formula per day and that, presently, Resident No. 3 was again experiencing increased congestion. Based upon Resident No. 3's prior experience at the hospice center with increased congestion and reduction in the amount of formula, upon the family's concern that three cans of formula per day was too much, and upon the dietician's opinion that Resident No. 3's comfort would be promoted by reducing the amount of the formula, the dietician decided to recommend reducing Resident No. 3's tube feeding. On January 26, 1999, the dietician recommended reducing the formula from three cans of formula per day to one can per day, from 720 calories (720 cc) to 240 calories (240 cc). No order was given that day by Resident No. 3's physician to reduce the tube feeding from 720 calories. The physician for Resident No. 3 was willing to reduce the formula or even discontinue it if the family of Resident No. 3 agreed. The family of Resident No. 3 were not willing to discontinue the tube feeding. Resident No. 3's physician did not order a reduction of the formula. On January 28, 1999, the physician diagnosed Resident No. 3 with pneumonia and recommended that the pneumonia be allowed to overcome her because of her terminal illness. Resident No. 3 improved and was taken off crisis care on February 3, 1999. Shortly thereafter, she began experiencing audible congestion. On February 12, 1999, Resident No. 3 was suffering from congestion, respiratory distress, and edema in her arms and thighs. On February 16, 1999, 13 days after Resident No. 3 was taken off crisis care, her physician ordered a reduction of the tube feeding to one can per day. Resident No. 3's respiratory problems became non-existent and she was removed from crisis care. Resident No. 3 remained on one can of formula, 240 calories, per day for a little over two months, from February 16, 1999, until the survey in April 1999. During that period of time, either the physician or his assistant reviewed Resident No. 3's condition and did not change her feeding order of one can per day. On February 26, 1999, Resident No. 3 was no longer congested. Her reduced feeding was not re-evaluated by Respondent to determine its necessity until the April survey. At the initial tour of Respondent by Petitioner survey team, the team member who was responsible for resident review of Resident No. 3 and who was a registered nurse observed Resident No. 3, who appeared to be a quite frail, thin and ill female, being tube fed. The feeding bag indicated that Resident No. 3 was receiving 240 calories (240 cc) per day. Resident No. 3's room had a strong odor, which the team member suspected was indicative of a skin infection, and a deodorizer can was on the floor next to Resident No. 3's bed. Respondent had no policy or procedure in place to monitor the continued necessity or advisability of such a condition as Resident No. 3's reduced feeding. The failure to have such a policy in place potentially put other residents at risk, which is a consideration of the surveyors when they make their decisions regarding the existence of a deficiency. The evidence fails to demonstrate that Respondent obtained informed consent from Resident No. 3's family for the reduced feeding. Respondent failed to fully inform the family of the effects or risks of reduced feeding on the healing of Resident No. 3's pressure sores. Respondent conducted planning meetings regarding Resident No. 3's care plan, but her health care surrogate, her son, was not invited to attend; whereas, if he was invited to attend, he would have had full knowledge of the effects or risks of the reduced feeding on the healing of her pressure sores. The evidence demonstrates that the reduced feeding in Resident No. 3's situation was not compatible with the standard of palliative care and was inconsistent with acceptable end-of- life care practices. Tag F224 Tag F224 incorporates federal regulation 42 CFR Section 483.13(c)(1)(i), which requires, in pertinent part, Respondent to "develop and implement written policies and procedures that prohibit mistreatment, neglect and abuse of residents." Neglect is defined by the SOM guidelines as "failure to provide goods and services necessary to avoid physical harm, mental anguish, or mental illness." The SOM guidelines further provide that, on an individual basis, neglect occurs "when a resident does not receive a lack of care in one or more areas (e.g., absence of frequent monitoring for a resident known to be incontinent, resulting in being left to lie in urine or feces)." The intent of the federal regulation is provided in the SOM guidelines, which provide, in pertinent part, that the intent is "to ensure that the facility has in place an effective system that regardless of the source (staff, other residents, visitors, etc.) prevents mistreatment, neglect, and abuse of residents . . . . However, such a system cannot guarantee that a resident will not be abused; it can only assure that the facility does whatever is within its control to prevent mistreatment, neglect, and abuse of residents." Petitioner's survey team determined that Respondent did not have procedures and policies in place to prevent the "neglect" of Resident No. 3. It was within Respondent's control to attempt to ascertain medically the causative agent of Resident No. 3's congestion. Respondent failed to seek a cause, medically, of the congestion but relied upon what was related to Respondent's staff as to what occurred at the hospice facility when the hospice facility was faced with Resident No. 3's congestion. Resident No. 3's tube feeding was drastically reduced based upon this reliance. It was within Respondent's control to fully inform Resident No. 3's health care surrogate of the effects of the drastically reduced tube feeding. The evidence failed to demonstrate that her health care surrogate was fully informed by Respondent regarding the effects of the reduced feeding on her pressure sores. Resident No. 3's physician indicated that he would agree with reducing the feeding if the family agreed to the reduction. The health care surrogate, not being informed of the full ramifications, agreed to the reduction in the tube feeding. Whether Respondent provided Resident No. 3 the necessary goods and care was indeterminable by the survey team. Respondent failed to provide goods and services to Resident No. 3 necessary to avoid physical harm or mental anguish. Respondent failed to have written policies and procedures that would have prohibited neglect to Resident No. 3; however, in accordance with the SOM guidelines, the written policies and procedures could not have guaranteed that she would not have been neglected. Petitioner cited Respondent for committing a violation of Tag F224 and classified the violation as a Class II deficiency. Petitioner also assigned a federal scope and severity rating of "G" to the Tag F224 deficiency. Tag F280 Tag F280 incorporates the requirement under federal regulation 42 CFR 483.20(k)(2), which requires, in pertinent part, the development of a comprehensive care plan (Plan) within seven days of the completion of the comprehensive assessment; the Plan to be prepared by an "interdisciplinary team," which includes "the attending physician, a registered nurse with responsibility for the resident, and other appropriate staff in disciplines as determined by the resident's needs, and to the extent practicable, . . . the resident's family or . . . legal representative"; and periodic review and revision by a team of qualified persons after each assessment. Respondent failed to update or revise Resident No. 3's care plan to address the symptom of congestion, which led to the reduced feeding. Respondent failed to invite or include Resident No. 3's health care surrogate to participate in any planning of Resident No. 3's care or in any decisions regarding her nutritional needs. Petitioner cited Respondent for committing a violation of Tag F280 and classified the violation as a Class II deficiency. Petitioner also assigned a federal scope and severity rating of "G" to the Tag F280 deficiency. Tag F314 Tag F314 incorporates federal regulation 42 CFR Section 483.25(c), which requires, in pertinent part, a facility to ensure that a "resident who enters the facility without pressure sores does not develop pressure sores unless the individual's clinical condition demonstrates that they were unavoidable" and that a "resident having pressure sores receives necessary treatment and services to promote healing, prevent infection and prevent new sores from developing." The SOM guidelines define a pressure sore as "ischemic ulceration and/or necrosis of tissues overlying a bony prominence that has been subjected to pressure, friction or shear." Furthermore, the SOM guidelines provide a "staging system," which is one method of describing the extent of tissue damage, and which provides, in pertinent part, that "Stage III" is described as a "full thickness of skin is lost, exposing the subcutaneous tissues - presents as a deep crater with or without undermining adjacent tissue" and that "Stage IV" is described as a "full thickness of skin and subcutaneous tissue is lost, exposing muscle and/or bone." Pressure sores in a terminally ill patient are unavoidable. Resident No. 3's pressure sores were unavoidable due to her clinical conditions. For Resident No. 3, maintaining adequate nutrition and hydration was necessary to prevent her pressure sores from worsening, to promote healing, and to prevent infection and breakdown. Respondent drastically reduced Resident No. 3's tube feeding to 240 calories (240 cc) per day. One pressure sore had worsened from a Stage III to a Stage IV. The dead tissue in the Stage III pressure sore was removed, and as a consequence, the pressure sore enlarged to a Stage IV pressure sore. No clinical measurements were available to indicate whether the reduction in the tube feeding negatively affected Resident No. 3. Petitioner cited Respondent for committing a violation of Tag F314 and classified the violation as a Class II deficiency. Petitioner also assigned a federal scope and severity rating of "G" to the Tag F314 deficiency. The evidence is insufficient to demonstrate that Respondent committed a violation of Tag F314. Tag F325 Tag F325 incorporates federal regulation 42 CFR Section 4483.25(i), which, in pertinent part, requires a facility to ensure that a resident "maintains acceptable parameters of nutritional status, such as body weight and protein levels, unless the resident's clinical condition demonstrates that this is not possible." Resident No. 3's clinical condition had a great impact on her nutritional status. Her tube feeding was reduced drastically to 240 calories (240 cc) per day. Respondent failed to properly discuss with and fully inform Resident No. 3's health care surrogate of the impact or effects of such a reduction. Moreover, no periodic review of the reduction was performed by Respondent, which was responsible for a care plan for Resident No. 3. The periodic examination of Resident No. 3's physician or the physician's assistant is no substitute for Respondent's responsibility for periodic review and update or revision, if necessary, of Resident No. 3's care plan. Respondent failed to "ensure" that Resident No. 3's nutritional status was maintained. Petitioner cited Respondent for committing a violation of Tag F325 and classified the violation as a Class II deficiency. Petitioner also assigned a federal scope and severity rating of "G" to the Tag F325 deficiency. Resident No. 1 Resident No. 1 was admitted to Respondent in September 1998, with a Stage IV pressure sore. Full thickness of skin and subcutaneous tissue was lost, exposing muscle and/or bone in a Stage IV pressure sore. To aid the healing of the pressure sore, Resident No. 1's physician ordered a variety of interventions, including ordering that she be given a protein supplement, Promod, in her juice twice a day. Petitioner's registered dietician, who was a member of the survey team, personally observed Resident No. 1 during at least two meals in which Resident No. 1 did not ingest the Promod. Respondent had no system in place to track whether the physician's order was being implemented. Having no such system in place, Respondent was unable to inform the physician of the ineffectiveness of the treatment modality addressing the pressure sore to enable the physician to implement a more effective alternative. During the initial tour of the facility, Petitioner's dietician noticed that Resident No. 1 had a large bruise on the left side of his forehead. The bruise was approximately the size of a quarter to a half-dollar and was a recent bruise that could have been sustained minutes or hours prior to its discovery by Petitioner's dietician. Resident No. 1 was confused and could not inform Petitioner's dietician how his forehead sustained the bruise. Respondent was unaware of the bruise until Petitioner's dietician brought the bruise to Respondent's attention. Respondent had no documentation or information on the bruise. An unknown injury report was completed after Petitioner's dietician brought the bruise to Respondent's attention. Tag F225 Tag F225 incorporates federal regulation 42 CFR 483.13(c), which provides, in pertinent part, that the facility "must have evidence that all alleged violations are thoroughly investigated, and must prevent further potential abuse while the investigation is in progress; and that the "results of all investigations must be reported to the administrator or his designated representative and to officials in accordance with state law " Respondent should have been aware of the bruise prior to the bruise being brought to Respondent's attention by Petitioner's dietician. The bruise was quite obvious and not hidden. Respondent failed to investigate the bruise, an injury of unknown origin. When Respondent failed to investigate the bruise, a potential risk of continued harm to Resident No. 1 and of harm to other residents existed. After Petitioner's dietician, a member of the Petitioner's survey team, reported the bruise to Respondent, an investigation by Respondent ensued. Afterward, the requirements for the investigation and reporting were complied with and adhered to. Petitioner cited Respondent for committing a violation of Tag F225 and classified the violation as a Class II deficiency. Petitioner also assigned a federal scope and severity rating of "G" to the Tag F225 deficiency. Tag F314 Tag F314 incorporates federal regulation 42 CFR Section 483.25(c), which requires, in pertinent part, a facility to ensure that a "resident who enters the facility without pressure sores does not develop pressure sores unless the individual's clinical condition demonstrates that they were unavoidable" and that a "resident having pressure sores receives necessary treatment and services to promote healing, prevent infection and prevent new sores from developing." Resident No. 1's physician ordered the ingestion of Promod. Respondent failed to ensure that Resident No. 1 ingested the Promod in accordance with the physician's order. Further, Respondent had no system in place to track whether the physician's order was being implemented, and, therefore, the physician was unable to determine the type of intervention needed, if any. Petitioner cited Respondent for committing a violation of Tag F314 and classified the violation as a Class II deficiency. Petitioner also assigned a federal scope and severity rating of "G" to the Tag F314 deficiency. Corrective Action Respondent received Petitioner's survey report on April 29, 1999. The survey report contained the date by which Respondent had to correct the deficiencies, which was by April 27, 1999. The time period for Respondent to correct the deficiencies had elapsed before Respondent was notified of the date for correcting the deficiencies. Respondent submitted a plan of action to correct the deficiencies. On April 27, 1999, Petitioner visited Respondent to determine the status of the Class II deficiencies. All of the deficiencies were not corrected, but, as a result of the visit, Petitioner changed Tags F224, F225, and F280 to Class III deficiencies. On July 2, 1999, Petitioner re-surveyed Respondent. Petitioner determined that Respondent had corrected all of the deficiencies. Conditional License Based upon the Class II deficiencies of the April 1999 survey, Petitioner issued Respondent a Conditional license, effective April 21, 1999, through July 2, 1999, from the date of the survey to the date the deficiencies were corrected. Penalty Based upon the Class II deficiencies of Tags F224, F225, F314, and F325, cited as a result of the April 1999 survey, Petitioner imposed a fine of $20,000 upon Respondent.
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 and therein: Dismiss the charge, as it relates to Resident No. 3 of the April 1999 survey, that Pinehurst Convalescent Center (Beverly Enterprises-Fla, Inc., d/b/a Beverly Gulf Coast- Florida) violated Tag F314, which incorporates federal regulation 42 CFR Section 483.25(c). Find that, as to the October 1998 survey, Pinehurst Convalescent Center (Beverly Enterprises-Fla, Inc., d/b/a Beverly Gulf Coast-Florida) violated Tag F309, which incorporates federal regulation 42 CFR Section 483.25, and Rule 59A-4.1288, Florida Administrative Code; and that the violation is a Class II deficiency. Find that, as to the April 1999 survey, Pinehurst Convalescent Center (Beverly Enterprises-Fla, Inc., d/b/a Beverly Gulf Coast-Florida): Violated Tag F224, which incorporates federal regulation 42 CFR Section 483.13(c)(1)(i), Subsections 400.022(1)(j), (k), and (l), Florida Statutes, and Rule 59A- 4.106(4)(x), Florida Administrative Code. Violated Tag F225, which incorporates federal regulation 42 CFR Section 483.13(c)(1)(ii), and Rule 59A- 4.106(4)(cc), Florida Administrative Code. Violated Tag F314, which incorporates federal regulation 42 CFR Section 483.25(c), Subsections 400.022(1)(j), (k), and (l), Florida Statutes, and Rule 59A-4.1288, Florida Administrative Code. Violated Tag F325, which incorporates federal regulation 42 CFR Section 483.25(i)(1), Subsection 400.022(1)(l), Florida Statutes, and Rule 59A-4.109(2), Florida Administrative Code. Impose a penalty of $2,500 for the violation committed as to the October 1998 survey. Impose a penalty of $5,000 per violation for the four violations committed as to the April 1999 survey, totaling $20,000. Uphold the change in the license rating of Pinehurst Convalescent Center (Beverly Enterprises-Fla, Inc., d/b/a Beverly Gulf Coast-Florida) to a Conditional license, effective April 21, 1999, through July 2, 1999. DONE AND ENTERED this 30th day of June, 2000, in Tallahassee, Leon County, Florida. ERROL H. POWELL Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 30th day of June, 2000.
The Issue The issues for determination are: (1) whether the noncompliance as alleged during the August 30, 2001, survey and identified as Tags F324 and F242, were Class II deficiencies; (2) whether the "Conditional" licensure status, effective August 30, 2001, to September 30, 2001, based upon noncompliance is appropriate; and (3) whether a fine in the amount of $5,000 is appropriate for the cited noncompliance
Findings Of Fact Charlotte is a nursing home located at 5405 Babcock Street, Northeast, Fort Myers, Florida, with 180 residents and is duly licensed under Chapter 400, Part II, Florida Statutes. AHCA is the state agency responsible for evaluating nursing homes in Florida pursuant to Section 400.23(7), Florida Statutes. As such, in the instant case it is required to evaluate nursing homes in Florida in accordance with Section 400.23(8), Florida Statutes (2000). AHCA evaluates all Florida nursing homes at least every 15 months and assigns a rating of standard or conditional to each licensee. In addition to its regulatory duties under Florida law, AHCA is the state "survey agency," which, on behalf of the federal government, monitors nursing homes that receive Medicaid or Medicare funds. On August 27 through 30, 2001, AHCA conducted an annual survey of Charlotte's facility and alleged that there were deficiencies. These deficiencies were organized and described in a survey report by "Tags," numbered Tag F242 and Tag F324. The results of the survey were noted on an AHCA form entitled "Statement of Deficiencies and Plan of Correction." The parties refer to this form as the HCFA 2567-L or the "2567." The 2567 is the document used to charge nursing homes with deficiencies that violate applicable law. The 2567 identified each alleged deficiency by reference to a Tag number. Each Tag on the 2567 includes a narrative description of the allegations against Charlotte and cites a provision of the relevant rule or rules in the Florida Administrative Code violated by the alleged deficiency. To protect the privacy of nursing home residents, the 2567 and this Recommended Order refer to each resident by a number (i.e., Resident 24) rather than by the name of the resident. AHCA must assign a class rating of I, II or III to any deficiency that it identifies during a survey. The ratings reflect the severity of the identified deficiency, with Class I being the most severe and Class III being the least severe deficiency. There are two Tags, F242 and F324 at issue in the instant case, and, as a result of the August 2001 survey, AHCA assigned each Tag a Class II deficiency rating and issued Charlotte a "Conditional" license effective August 30, 2001. Tag F242 Tag F242 generally alleged that Charlotte failed to meet certain quality of life requirements for the residents, based on record review, group interviews, and staff interviews, and that Charlotte failed to adequately ensure that the residents have a right to choose activities that allow them to interact with members of the community outside the facility. On or about August 24, 2001, AHCA's surveyors conducted group interviews. During these interviews, 10 of 16 residents in attendance disclosed that they had previously been permitted to participate in various activities and interact with members of the community outside the facility. They were permitted to go shopping at malls, go to the movies, and go to restaurants. Amtrans transportation vans were used to transport the residents to and from their destinations. The cost of transportation was paid by Charlotte. An average of 17 to 20 residents participated in those weekly trips to dine out with other community members at the Olive Garden and other restaurants. During those trips, Charlotte would send one activity staff member for every four to six residents. The record contains no evidence that staff nurses accompanied those select few residents on their weekly outings. The outings were enjoyed by those participants; however, not every resident desired or was able to participate in this particular activity. Since 1985, outside-the-facility activities had been the facility's written policy. However, in August 2000, one year prior to the survey, Matthew Logue became Administrator of the facility and directed his newly appointed Activities Director, Debbie Francis, to discontinue facility sponsored activities outside the facility and in its stead to institute alternative activities which are all on-site functions. Those residents who requested continuation of the opportunity to go shopping at the mall or dine out with members of the community were denied their request and given the option to have food from a restaurant brought to the facility and served in-house. The alternative provided by the facility to those residents desiring to "interact with members of the community outside the facility" was for each resident to contact the social worker, activity staff member, friends or family who would agree to take them off the facility's premises. Otherwise, the facility would assist each resident to contact Dial-A-Ride, a transportation service, for their transportation. The facility's alternative resulted in a discontinuation of all its involvement in "scheduling group activities" beyond facility premises and a discontinuation of any "facility staff members" accompanying residents on any outing beyond the facility's premises. As described by its Activities Director, Charlotte's current activities policy is designed to provide for residents' "interaction with the community members outside the facility," by having facility chosen and facility scheduled activities such as: Hospice, yard sales, barbershop groups for men and beautician's day for women, musical entertainment, antique car shows, and Brownie and Girl Guides visits. These, and other similar activities, are conducted by "community residents" who are brought onto the facility premises. According to the Activities Director, Charlotte's outside activities with transportation provided by Amtrans buses were discontinued in October of 2000 because "two to three residents had been hurt while on the out trip, or on out-trips."1 Mr. Logue's stated reason for discontinuing outside activities was, "I no longer wanted to take every member of the activities department and send them with the resident group on an outing, thereby leaving the facility understaffed with activities department employees." The evidence of record does not support Mr. Logue's assumption that "every member of the facility's activities department accompanied the residents on any weekly group outings," as argued by Charlotte in its Proposed Recommended Order. Charlotte's Administrator further disclosed that financial savings for the facility was among the factors he considered when he instructed discontinuation of trips outside the facility. "The facility does not sponsor field trips and use facility money to take people outside and too many staff members were required to facilitate the outings." During a group meeting conducted by the Survey team, residents voiced their feelings and opinions about Charlotte's no longer sponsoring the field trips on a regular basis in terms of: "feels like you're in jail," "you look forward to going out," and being "hemmed in." AHCA's survey team determined, based upon the harm noted in the Federal noncompliance, that the noncompliance should be a State deficiency because the collective harm compromised resident's ability to reach or maintain their highest level of psychosocial well being, i.e. how the residents feel about themselves and their social relationships with members of the community. Charlotte's change in its activities policy in October of 2000 failed to afford each resident "self- determination and participation" and does not afford the residents the "right to choose activities and schedules" nor to "interact with members of the community outside the facility." AHCA has proved the allegations contained in Tag F242, that Charlotte failed to meet certain quality of life requirements for the residents' self-determination and participation. By the testimonies of witnesses for AHCA and Charlotte and the documentary evidence admitted, AHCA has proven by clear and convincing evidence that Charlotte denied residents the right to choose activities and schedules consistent with their interests and has failed to permit residents to interact with members of the community outside the facility. Tag F324 As to the Federal compliance requirements, AHCA alleged that Charlotte was not in compliance with certain of those requirements regarding Tag F324, for failing to ensure that each resident receives adequate supervision and assistance devices to prevent accidents. As to State licensure requirements of Sections 400.23(7) and (8), Florida Statutes (2000), and by operation of Florida Administrative Code, Rule 59A-4.1288, AHCA determined that Charlotte had failed to comply with State established rules, and under the Florida classification system, classified Tag F324 noncompliance as a Class II deficiency. Based upon Charlotte's patient record reviews and staff interviews, AHCA concluded that Charlotte had failed to adequately assess, develop and implement a plan of care to prevent Resident 24 from repeated falls and injuries. Resident 24 was admitted to Charlotte on April 10, 2001, at age 93, and died August 6, 2001, before AHCA's survey. He had a history of falls while living with his son before his admission. Resident 24's initial diagnoses upon admission included, among other findings, Coronary Artery Disease and generalized weakness, senile dementia, and contusion of the right hip. On April 11, 2001, Charlotte staff had Resident 24 evaluated by its occupational therapist. The evaluation included a basic standing assessment and a lower body assessment. Resident 24, at that time, was in a wheelchair due to his pre-admission right hip contusion injury. On April 12, 2001, two days after his admission, Resident 24 was found by staff on the floor, the result of an unobserved fall, and thus, no details of the fall are available. On April 23, 2001, Resident 24 was transferred to the "secured unit" of the facility. The Survey Team's review of Resident 24's Minimum Data Set, completed April 23, 2001, revealed that Resident 24 required limited assistance to transfer and to ambulate and its review of Resident 24's Resident Assessment Protocols (RAPs), completed on April 23, 2001, revealed that Resident 24 was "triggered" for falls. Charlotte's RAP stated that his risk for falls was primarily due to: (1) a history of falls within the past 30 days prior to his admission; (2) his unsteady gait; (3) his highly impaired vision; and (4) his senile dementia. On April 26, 2001, Charlotte developed a care plan for Resident 24 with the stated goal that the "[r]esident will have no falls with significant injury thru [sic] July 25, 2001," and identified those approaches Charlotte would take to ensure that Resident 24 would not continue falling. Resident 24's care plan included: (1) place a call light within his reach; (2) do a falls risk assessment; (3) monitor for hazards such as clutter and furniture in his path; (4) use of a "Merry Walker" for independent ambulation; (5) placing personal items within easy reach; (6) assistance with all transfers; and (7) give Resident 24 short and simple instructions. Charlotte's approach to achieving its goal was to use tab monitors at all times, to monitor him for unsafe behavior, to obtain physical and occupational therapy for strengthening, and to keep his room free from clutter. All factors considered, Charlotte's care plan was reasonable and comprehensive and contained those standard fall prevention measures normally employed for residents who have a history of falling. However, Resident 24's medical history and his repeated episodes of falling imposed upon Charlotte a requirement to document his records and to offer other assistance or assistive devices in an attempt to prevent future falls by this 93-year-old, senile resident who was known to be "triggered" for falls. Charlotte's care plan for Resident 24, considering the knowledge and experience they had with Resident 24's several falling episodes, failed to meet its stated goal. Charlotte's documentation revealed that Resident 24 did not use the call light provided to him, and he frequently refused to use the "Merry Walker" in his attempts of unaided ambulation. On June 28, 2001, his physician, Dr. Janick, ordered discontinuation of the "Merry Walker" due to his refusal to use it and the cost involved. A mobility monitor was ordered by his physician to assist in monitoring his movements. Charlotte's documentation did not indicate whether the monitor was actually placed on Resident 24 at any time or whether it had been discontinued. Notwithstanding Resident 24's refusal to cooperatively participate in his care plan activities, Charlotte conducted separate fall risk assessments after each of the three falls, which occurred on April 12, May 12, and June 17, 2001. In each of the three risk assessments conducted by Charlotte, Resident 24 scored above 17, which placed him in a Level II, high risk for falls category. After AHCA's surveyors reviewed the risk assessment form instruction requiring Charlotte to "[d]etermine risk category and initiate the appropriate care plan immediately," and considered that Resident 24's clinical record contained no notations that his initial care plan of April 23, 2001, had been revised, AHCA concluded that Charlotte was deficient. On May 13, 2001, Dr. Janick visited with Resident 24 and determined that "there was no reason for staff to change their approach to the care of Resident 24." Notwithstanding the motion monitors, on June 17, 2001, Resident 24 fell while walking unaided down a corridor. A staff member observed this incident and reported that while Resident 24 was walking (unaided by staff) he simply tripped over his own feet, fell and broke his hip. Charlotte should have provided "other assistance devices," or "one-on-one supervision," or "other (nonspecific) aids to prevent further falls," for a 93-year-old resident who had a residential history of falls and suffered with senile dementia. Charlotte did not document other assistive alternatives that could have been utilized for a person in the condition of Resident 24. AHCA has carried its burden of proof by clear and convincing evidence regarding the allegations contained in Tag F324.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that: The Agency enter a final order upholding the assignment of the Conditional licensure status for the period of August 30, 2001 through September 30, 2001, and impose an administrative fine in the amount of $2,500 for each of the two Class II deficiencies for a total administrative fine in the amount of $5,000. DONE AND ENTERED this 13th day of February, 2003, in Tallahassee, Leon County, Florida. FRED L. BUCKINE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 13th day of February, 2003.
Conclusions THE PARTIES resolved all disputed issues and executed a settlement agreement, which is attached and incorporated by reference. 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 SWS day of fac, 2014, in Tallahassee, Leon County, Florida. lizabeth f Vf el Agency for Health Care Administration Agency for Health Care Administration v. Little Hannah Home Services, Inc. (Case No.: 13-1575MPI; Provider No.: 684222496; C. I. No.: 12-1580-000) Final Order Page 1 of 2 Filed April 2, 2014 3:59 PM 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: Richard J. Diaz, Esquire Law Offices of Richard J. Diaz, P.A. 3127 Ponce De Leon Blvd. Coral Gables, Florida 33134 rick@rjdpa.com (Via Electronic Mail) Willis F. Melvin, Jr., Assistant General Counsel Agency for Health Care Administration Eric W. Miller, Inspector General Agency for Health Care Administration Richard Zenuch, Bureau Chief Medicaid Program Integrity Finance & Accounting HQA {via email) CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing was served to the above named addresses by electronic mail or interoffice mail this / y of Al 2014. =f . (Stroop, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Bldg. 3, MS #3 Tallahassee, Florida 32308-5403 (850) 412-3630 Agency for Health Care Administration v. Littte Hannah Home Services, Inc. (Case No.: 13-1575MPI; Provider No.: 684222496; C. 1. No.; 12-1580-000) Final Order Page 2 of 2
The Issue The issues in the case are (1) whether the decision of the Agency for Health Care Administration (AHCA) to not select Little Havana Activities and Nutrition Centers of Dade County, Inc. (Little Havana), for the award of a contract for the provision of long-term care managed care services pursuant to AHCA Invitation to Negotiation Solicitation No. AHCA ITN 011- 12/13, entitled "Statewide Medicaid Managed Care--Long Term Care, Region 11" (ITN) was contrary to the AHCA's governing statutes, rules, polices or any applicable ITN specification, and, if so, whether such selection decision was clearly erroneous, contrary to competition, arbitrary, or capricious; whether Little Havana's response to the ITN was responsive; whether Little Havana was a responsible vendor; and (4) whether Little Havana's protest is barred for failure to submit the required protest bond.
Findings Of Fact AHCA was created by chapter 20, Florida Statutes, as the chief health policy and planning entity for the state of Florida. AHCA is the state agency authorized to enter into contracts with private entities for the provision of long-term managed care services to Medicaid enrollees under section 409, part IV, Florida Statutes (2012).1/ Long-term care services to be provided under these contracts include nursing facility care and services provided in assisted living facilities, hospice, and adult day care, along with other services specifically required by law. Section 409.966 requires AHCA to select a limited number of eligible plans to participate in the state-wide Medicaid managed care program, and further requires AHCA to conduct separate procurements for 11 statutorily-prescribed regions in Florida. § 409.966(2), Fla. Stat. Separate and simultaneous procurements were to be conducted in each of the 11 regions. On June 29, 2012, AHCA issued the ITN, which solicited responses from vendors seeking to provide long-term care services to Medicaid enrollees in each of the 11 regions. The only procurement at issue in this proceeding is for Region 11, which comprises Miami-Dade and Monroe counties. On July 13, 2012, AHCA issued Addendum No. 1 to the ITN. On July 30, 2012, AHCA issued Addendum No. 2 to the ITN. On August 7, 2012, AHCA issued Addendum No. 3 to the ITN. On August 17, 2012, AHCA issued Addendum No. 4 to the ITN. These addenda included the questions posed by the vendors concerning the ITN and AHCA's responses. The ITN included instructions, 67 specific questions, certifications, and attestations. No protests of the terms, conditions or specifications of the ITN were filed within 72 hours of the release of the ITN or the addenda. In accordance with section 409.981(2)(k), the ITN stated that AHCA would issue a minimum of five and a maximum of ten contract awards for Region 11. Section 409.981(2)(k) requires that a least one of the contracts must be with a provider service network if any provider service network submitted a responsive bid. The ITN stated that AHCA, at its sole discretion, would determine the number of contracts to be issued. The ITN provided: The State has established certain requirements with respect to responses submitted to competitive solicitations. The use of "shall," "must," or "will" (except to indicate futurity) in this ITN, indicates a requirement or condition from which a material deviation may not be waived by the State. A deviation is material if, in the State's sole discretion, the deficient response is not in substantial accord with the ITN requirements, provides an advantage to one respondent over another, or has a potentially significant effect on the quality of the response or on the cost to the state. Material deviations cannot be waived. The words "should" or "may" in this ITN indicate desirable attributes or conditions, but are permissive in nature. Deviation from, or omission of, such desirable feature will not in itself cause rejection of a response. Little Havana is a Florida not-for-profit corporation with its principal place of business at 700 Southwest Street, Miami, Florida, 33130. Little Havana, American Eldercare, Sunshine, United, Coventry, Molina, Amerigroup Florida, Humana, Freedom Health, Inc. (Freedom), Wellcare of Florida, Inc. (Wellcare), Universal Healthcare, Inc. (Universal), Simply Health Care Plans, Inc. (Simply), Advantage Florida Health Plan, Inc. (Advantage), and Florida Healthcare Plus, Inc. (Florida Healthcare) each submitted a response to the ITN. Little Havana and all Intervenors timely submitted their responses to the ITN. American Eldercare was the only Provider Service Network (PSN) to submit a response to the ITN. AHCA appointed 16 evaluators to evaluate and score the vendor responses for Region 11. There were six "core evaluators," Evaluators 1 through 6. Specialty evaluators, Evaluators 7 through 16, scored in such areas as clinical services, quality management, compliance history, information technology, and financials. The evaluators were qualified to perform the evaluations. AHCA's decision to use the number of evaluators it used was reasonable. The ITN established the following evaluation criteria that would be used by evaluators when scoring each vendor's response: mandatory criteria; financial stability; review of provider comments; past performance evaluation; cost proposal; and technical response evaluation. After the evaluations were completed, AHCA tabulated the total scores awarded by each of the evaluators for each vendor and ranked the vendors. AHCA's process for calculating the final vendor rankings in Region 11 was as follows. The scores from Evaluators 7 through 16 for each vendor were compiled, and AHCA calculated an average based on the number of evaluators who scored each particular question. Those averages were then added to the scores for each of the Evaluators 1-6. This combination of scores represented each vendor's "total score" for each core evaluator. The vendor's total scores for Evaluators 1 through 6 were ranked in order from the highest to the lowest by evaluator. The rankings for each vendor were added, then divided by six to determine average rank. In Region 11, the top seven vendors were invited to negotiate. AHCA selected the seven highest-ranking vendors, American Eldercare, Sunshine, United, Coventry, Humana, Molina, and Amerigroup Florida to enter into negotiations for a contract. Based on AHCA's tabulations of the evaluators' scores, Little Havana's ranking was the eighth highest among the vendors. AHCA did not select Little Havana for negotiations. On January 15, 2013, AHCA issued its Bid Proposal Tabulation for the ITN, and noticed its intent to award contracts to the following vendors: American Eldercare, Sunshine, United, Coventry, and Amerigroup Florida. In addition to identifying those vendors to which AHCA intended to award contracts, the Bid Proposal Tabulation identified the final scoring evaluation ranking of each scored vendor as follows: Molina, 1.00; American Eldercare, 2.17; Humana, 4.00; United, 4.33; Coventry, 5.17; Sunshine, 6.33; Amerigroup Florida, 6.67; Little Havana, 7.50; Universal, 9.50, Wellcare, 9.67; and Simply, 9.67. On January 15, 2013, Little Havana filed its notice of intent to protest AHCA's intended contract awards. The formal written protest was due to be filed within ten days of the filing of the notice of intent to protest. § 120.57(3)(b), Fla. Stat. The tenth day after the filing of the notice of intent to protest fell on Saturday, January 26, 2013; thus, the formal written protest was due to be filed on Monday, January 28, 2013. Fla. Admin. Code R. 28-106.103. On January 25, 2013, Little Havana filed with AHCA, by facsimile transmission, a formal written protest, challenging AHCA's decision to select other vendors, to the exclusion of Little Havana, for negotiation and contract awards. AHCA received the copy of the protest and bond on January 25, 2013. The protest which Little Havana transmitted to AHCA included a copy of the protest bond required to be submitted pursuant to section 287.042(2)(c). On January 25, 2013, Little Havana sent the original formal written protest and the original protest bond to AHCA by Federal Express. Federal Express did not deliver the original protest and bond to AHCA until January 29, 2013, one day after the deadline for filing the protest and bond. In order to have standing to be awarded a contract, Little Havana's reply to the ITN must be responsive. The ITN established mandatory criteria as a threshold for determining whether vendor replies would be responsive, including a "signed Attachment K, Required Statements, as required in Attachment C, Special Conditions, Section C.46, Other Required Documentation." The ITN provided that "responses failing to comply with all mandatory criteria will not be considered for further evaluation" and would be considered non-responsive. ITN Section C.46 requires the vendor to certify that it currently operates as one of the following: health maintenance organization (HMO), long-term care provider service network, exclusive provider organization, accountable care organization, or other insurer that meets the ownership and financial requirements of a long-term care provider service network. Attachment K of the ITN contained the certification that the vendor currently operates as an HMO and stated: I hereby certify my company currently operates as one (1) of the following: ? HMO Health Maintenance Organization (HMO) and possess a current Florida Certificate of Authority and Health Care Provider Certificate (641 Part III) or a Florida Certificate of Authority and a Limited Health Care Provider Certificate (641.2018 and 641 Part III) in at least one (1) Florida county. Attachment K required the vendor to check the box for the plan that it was currently operating and required the signature of the vendor's qualified representative. Because of the time frames for program implementation2/ and the human and financial scale of the procurement, the purpose behind the ITN requirement that vendors currently operate as an HMO or other eligible plan is to ensure that vendors are experienced enough to hit the ground running and avoid start-up issues. The attestations and certifications are important to AHCA program integrity, and there are a number of attestations required in the course of business between AHCA and managed care organizations. These attestations include verifications regarding the accuracy, validity, and completeness of encounter data, billing, and fraud and abuse reportings. AHCA cannot validate every detail in each submission by the contractors, so AHCA relies upon attestations to validate that submittals are complete, accurate, and conform to the parameters of the attestation. In its response to the ITN, Little Havana checked the box in Attachment K certifying that it currently operates as an HMO and possessed a current Certificate of Authority and Health Care Provider Certificate, but did not check any other option that it currently operated as another type of eligible plan. Manuel Marrero, Chairman of the Board for Little Havana, signed the certification that Little Havana was currently operating as an HMO; however, he had no knowledge whether Little Havana was operating as an HMO at the time of its response submittal. Little Havana had a Certificate of Authority from the Florida Office of Insurance Regulation and a Health Care Provider Certificate from AHCA. Although Little Havana was authorized to operate as an HMO, at the time of the submittal of its response to the ITN, Little Havana was not currently operating as an HMO. Little Havana had no income from its HMO. Little Havana has never had a single enrollee in its HMO; has never paid a claim as an HMO; is not accredited as an HMO; has never billed any person for participation in its HMO, and has never provided any service to any patient as an HMO. Little Havana serves clients through the Nursing Home Diversion Program administered by the Department of Elder Affairs and intends to transfer those clients into its new HMO if it is awarded a contract pursuant to the ITN. In the responses to the ITN, AHCA took the certifications and attestations of the vendors to be complete and accurate. After the initiation of the bid protest by Little Havana, AHCA learned that Little Havana was not currently operating as an HMO at the time it submitted its response to the ITN. Had AHCA been aware that Little Havana was not currently operating as an HMO at the time Little Havana submitted its response to the ITN, AHCA would have deemed Little Havana's response as non-responsive and would not have scored its response. Had AHCA known that Little Havana was not currently operating as an HMO at the time of its ITN response, AHCA would have considered Little Havana not to be a responsible vendor for untruthfully certifying in Attachment K that it was currently operating as an HMO. The determination of whether a vendor is responsible is dependent on the vendor's integrity and the agency's ability to trust that the vendor will act in the state's best interests and adequately perform the contract. The truthfulness of an attestation is one component to the consideration of whether a vendor is responsible. If a vendor is found not to be responsible, AHCA would not contract with that vendor. Attachment E-1-A of the ITN required the vendors to make the following attestation: I hereby certify that no modification and/or alteration has been made to the forms, narrative and/or instructions contained in Attachment E-1-A, Submission Requirements and Evaluation Criteria Components and that the response adheres to the Agency's prescribed response allowances for response narrative and attachments. The attestation form stated: IN THE EVENT THE AGENCY DETERMINES THE RESPONDENT HAS MODIFIED AND/OR ALTERED ATTACHMENT E-1-A, SUBMISSION REQUIREMENTS AND EVALUATION CRITERIA COMPONENTS, AND/OR HAS OTHERWISE CIRCUMVENTED THE AGENCY'S PRESCRIBED ALLOWANCES FOR RESPONSE SUBMISSION, THE AGENCY WILL REJECT THE RESPONSE. Little Havana's response contained the attestation that it had not modified or altered Attachment E-1-A, Submission Requirements and Evaluation Components. As part of its response to question 67 of the ITN relating to Little Havana's provider network, Little Havana was to submit two forms, which were to be downloaded from an AHCA website as part of the ITN. The forms included an embedded scoring formula, which would automatically calculate the number of points to be awarded and assign point totals based on the data filled in by the vendors. Little Havana did not download and use the forms as prescribed in the ITN. Little Havana altered or modified the ITN forms in that Little Havana did not use the forms, but developed and used its own forms. The purpose of Question 67 was to determine whether the vendors had an adequate provider network. The ITN required the vendors to provide a list of currently contracted network providers and copies of letters of agreement or letters of intent from providers who intend to join the network. The question further directed: The respondent shall: Follow the instructions in Exhibit 1, Regional Contracts and Agreements Completion Instructions; Complete Exhibit 2, Network Contracts and Agreements--Facility Services; and Complete Exhibit 3, Network Contracts and Agreements--Non Facility. Question 67 further stated: "Response must include Exhibits 2 and 3 referenced above and no maximum attachments. Exhibits 2 and 3 to Question 67 were electronic Excel spreadsheets which were to be accessed and downloaded from the AHCA website as part of the ITN. Each exhibit was preceded in the ITN with two pages of "Completion Instructions" followed by spreadsheets. The ITN repeatedly made clear that responding vendors (referred to in the ITN as "Respondents") were to use the prescribed Excel spreadsheet forms to provide the requested information. Specifically, the Completion Instructions stated: Respondents to this ITN must complete Exhibit 2, Network Adequacy--Facility Services and Exhibit 3, Network Adequacy-- Non Facility within this attachment. Failure to provide the information requested will affect the overall scoring of the response, as specified in Attachment E, Part II, Evaluation Criteria. * * * EXHIBIT 2, NETWORK ADEQUACY--FACILITY SERVICES: Using Table 1-LTC Provider Qualifications and Network Adequacy Requirements in Attachment D-II, Core Contract Provisions, Exhibit 7, Item I., as a reference, the Respondent shall complete Exhibit 2, Network Adequacy--Facility Services, within this attachment. The Respondent shall list on this form all facility service providers with which the Respondent has a signed agreement or contract with to serve the populations covered in Attachment D-II, Core Contract Provisions. * * * EXHIBIT 3, NETWORK ADEQUACY-NON-FACILITY: Using Table 1-LTC Provider Qualifications and Network Adequacy Requirement in Attachment D-II, Core Contract Provisions, Exhibit 7, Item I., as a reference, the Respondent shall complete Exhibit 3, Network Adequacy--Non-facility Services, within this attachment. The Respondent shall list on this form all non-facility service providers in which the Respondent has a signed agreement or contract with to serve the populations covered in Attachment D-II, Core Contract Provisions. Any question whether the vendors were required to use these specific forms was eliminated in the answers to several questions asked by the vendors and published as part of Addendum 2 to the ITN: Question 521: Please provide Attachment E-1 in an editable format such as Microsoft Word or Excel. Answer: The Agency has provided the version of the document which respondents are to utilize. See http.//ahca.myflorida.com/Procurements/index .shtml. * * * Question 526: We have begun documenting the Agency-provided response forms. The formatting appears to create challenges when trying to match the response with the evaluation criteria because the column spacing is not locked. Will the Agency consider alternative submission formats? Answer: No. Little Havana failed to utilize AHCA's prescribed electronic forms to input information as required by Question 67 of the Attachment E-1-A, Submission Requirements and Evaluation Criteria and, instead, created its own altered version of AHCA's prescribed forms. In creating its own forms, Little Havana changed and/or omitted certain portions of the required forms. The forms created by Little Havana did not include AHCA's embedded scoring formulas; thus, Little Havana's forms did not show the number of points that should be awarded and did not assign point totals for the information supplied by Little Havana. Little Havana's forms, which looked similar to AHCA's electronic forms, did not include all of the listed categories. Little Havana omitted some provider categories and doubled up on others. The ITN stated how the responses to Question 67 would be scored: Two (2) points will be awarded per facility/non-facility for having a signed contract, letter of agreement or letter of intent. The evaluator will review all attached documentation, as required above, to ensure the information entered by the Respondent in Exhibits 2 and 3 are accurate. A total of 100 points is possible per county (20 maximum for facility, 80 maximum for non-facility). Overall scores (listed as REGION XX FINAL SCORE on the bottom of Exhibit 3 have been converted to fall between the standard evaluations scores 0 and 5 based on the combined Facility/non- facility raw scores. The points from the combined spreadsheets are converted to the following: No score = 0 Score greater than 0 but less than or equal to 0.20 = 1 Score greater than 0.20 but less than or equal to 0.40 = 2 Score greater than 0.40 but less than or equal to 0.60 = 3 Score greater than 0.60 but less than or equal to 0.80 = 4 Score greater than 0.80 = 5 The final score that represents the combined facility and non-facility provider scores will be used in Attachment E, Part II, Evaluation Criteria. The combined final raw score for the combined facility and non-facility providers was then weighted by 25 for the final scoring. The maximum final scoring for Question 67 was 125 points. Evaluators 1 through 6 evaluated the responses to Question 67. During a meeting of the evaluators and purchasing staff prior to the commencement of the evaluations, Kelly Walsh, Evaluator 4, asked what the evaluators were supposed to do if a vendor listed a service provider on the forms for Question 67 but did not provide the documentation to support the listing of the service provider. She was told to flag the lack of documentation and make a note of it. During the evaluation process, Ms. Walsh told AHCA procurement staff that Little Havana had not filled out the totals on the spreadsheet and asked AHCA procurement staff how she was supposed to evaluate Little Havana's response to Question 67. Ms. Walsh was told to score the response to Question 67 to the best of her ability. Although Ms. Walsh reviewed the supporting documentation of the other vendors for Question 67, she used the score from the spreadsheets without adjusting the score if no supporting documents were provided. Phyllis Davis, Evaluator 3, reviewed Little Havana's response to Question 67 and saw that Little Havana had not used the forms that the ITN required. She understood that the forms were self-scoring, meaning that the form had an embedded formula that would score the data supplied by the vendors on the form and that she was to take the score on the form as the score for the vendor. When she originally evaluated Little Havana's response to Question 67, she had left the score for Little Havana blank because there were no scores listed on the forms. After the evaluation, Ms. Davis was called back and told that she had not scored Question 67. At that time, Ms. Davis manually calculated Little Havana's score, using the instructions in the ITN. Princilla Brown-Jefferson, Evaluator 5, saw that Little Havana's responses to Question 67 did not have the scores tabulated on the forms submitted by Little Havana. During the evaluation, she asked an AHCA procurement staff member whether the vendors' responses on the forms were to be automatically scored based on the information put on the forms by the vendors. She was told that the forms would be self-scoring. Because Little Havana's forms did not have scores, Ms. Brown-Jefferson gave Little Havana a zero for Question 67. Keith Young, Evaluator 1, participated in the development of the ITN. He, along with Cliff Schmidt, developed the forms that would be used by the vendors in responding to Question 67. Mr. Young understood that the forms had an embedded formula which would create the scores for Question 67 based on the information provided by the vendors on the forms. He also understood that if the documentation submitted by the vendors did not support the form-generated score that he would have to manually deduct points and recalculate the score. During the evaluation, Mr. Young saw that Little Havana had not used the forms with the embedded formulas, and when he brought the failure to use the forms to the attention of AHCA procurement staff, he was told to do the best that he could in scoring Little Havana's responses. He returned to his evaluation and reviewed the forms submitted by Little Havana. His review showed that Little Havana had not listed all the provider services that were listed in the ITN forms. He calculated the score for Little Havana using the instructions in the ITN. The other core evaluators gave Little Havana five points for Question 67. Thus, they must have calculated the scores manually. On the financial evaluation criteria, Evaluator 16, Ryan Fitch, who is a certified public accountant (CPA), scored Little Havana as follows: ten points out of 20 available points for Part A, stability; 20 points out of 20 available points for Part B, projections; ten points out of 20 available points for Part C, required accounts; 20 points out of 20 available points for Part D, required accounts; and 20 points out of 20 available points for Part E, required accounts. The ITN provided Part A be scored with a weighted factor of 50 percent; Part B to be scored with a weighted factor of 25 percent; Part C to be scored with a weighted factor of three percent; Part D to be scored with a weighted factor of 15 percent; and Part E to be scored with a weighted factor of seven percent. After applying Evaluator 16's scores to the weighted factors for Parts A through E, Evaluator 16 scored Little Havana's Financial Information Evaluation Criteria a total of 14.7 points out of 20 available points. Little Havana presented the testimony of Ronald Finkelstein as its expert on the financial evaluation. Mr. Finkelstein disagreed with only two aspects of Mr. Fitch's evaluation: the calculation of the operating margin ratio and the start-up fund analysis. Mr. Finkelstein did not state that Mr. Fitch incorrectly performed his analysis, but did state that any differences between his analysis and Mr. Fitch's analysis were reasonable and resulted from the application of subjective professional judgment--wherein two CPA's could reasonably differ on the interpretation of financial statements. The operating margin was one of six financial measures calculated in Part A. Even if that ratio was recalculated in accordance with Mr. Finkelstein's analysis and a score assigned to it, the points that Little Havana received for the Part A evaluation of its financial statements would not have changed. Mr. Finkelstein challenged Mr. Fitch's characterization of Little Havana' ability to fund its start-up fund at Part C of the financial evaluation, as "questionable" rather than "likely." Little Havana's surplus start-up projections identified a total of $1.1 million that would be needed to fund that account for three months: $142,165 in November, 2013, $477,512 in December 2013, and $481,847 in January 2014. These amounts appear on Little Havana's financial pro formas on the line item designated "administrative expenses." The majority of the costs Little Havana would incur in the first three months are for medical expenses of $5.195 million, $13.547 million and $13.655 million, respectively, or a total of over $33 million. Neither Little Havana, in preparing its proposal, or Mr. Finkelstein, in analyzing it, included all of the operating expenses in sizing the start-up fund. Mr. Finkelstein was of the opinion that the failure to include these operating expenses in Little Havana's projections for funding its start-up fund were not fatal, because the contract, if awarded to Little Havana, would generate sufficient revenue, paid in advance at the beginning of each month, to pay all of the operating expenses. However, Mr. Finkelstein overlooked the clear statement in the ITN that the start-up fund must be in the form of cash or liquid assets, excluding the revenues from Medicaid payments. The revenues that Little Havana would receive, if it were awarded a contract, would be Medicaid revenues. Mr. Finkelstein noted that Little Havana had $8.4 million in unrestricted cash available for a start-up fund. However, the $8.4 million would not cover the $33 million Little Havana would need for its start-up fund. Question 1 concerned plan accreditation, was worth a maximum of ten points, and required vendors to "provide documentation of current accreditation by a nationally recognized accrediting body of the Managed Care Plan that will be providing services outlined in this ITN." The ITN specified the following evaluation criteria: For the Managed Care Plan that will provide services under this ITN, whether the respondent has: full accreditation by a nationally recognized accrediting body e.g., accredited by NCQA, full two-(2) year accreditation for URAC, of three (3) accreditation for AAAHCA; or partial/conditional health accreditation (e.g., provisional for NCQA, conditional or provisional for URAC, or one (1) year or six months for AAAHC; or denied accreditation The scoring scale for Question 1 was provided in the ITN: 5 points for full accreditation; 3 points for partial/conditional accreditation; 0 points if accreditation denied or no accreditation; 5 additional points for full accreditation with NCQA. In Addendum 2 of the ITN, a vendor posed this question: "For Respondents who are new entrants into the market, would AHCA award full credit for this question [Question 1] for those Respondents whose affiliated companies have current accreditations?" AHCA answered: "No. Points will be awarded to respondents who are accredited at the time of the submission of the response." Thus, it is clear that points would not be awarded if the parent company rather than the vendor submitting the response. Amerigroup Florida stated in its response to the ITN that it was a wholly-owned subsidiary of Amerigroup Corporation. In its response to Question 1, Amerigroup Florida stated: Amerigroup maintains the following accreditations and certifications: Full 3-year accreditation by Accreditation Association for Ambulatory Health Care (AAAHC)--Amerigroup Florida Full 3-year accreditation by NCQA of 8 Disease Management (DM) Patient and Practitioner Oriented Programs--Amerigroup Corporation Full 3-year certification by CMS for our special needs program (SNP) model of care on recommendation from NCQA--Amerigroup Corporation Amerigroup Florida further stated: Amerigroup earned a second 3-year Patient and Practitioner Oriented NCQA accreditation in 2009 for out national DM programs. In Florida, we currently manage 16,659 Medicaid and Medicare LTC equivalent members in DM (omitting the TANF/CHIP members)[.] Evaluators 1, 2, 5, and 6 awarded Amerigroup Florida the additional five points for having full accreditation with NCQA. Evaluator 1 based his awarding of the five points on Amerigroup Corporation's having achieved a second three-year NCQA accreditation in its disease management program; Amerigroup Corporation, presumably through Amerigroup Florida, currently manages 16,000 Medicare and Medicaid long-term care members in disease management programs in Florida; and his understanding that Amerigroup Florida's enrollees would enjoy the benefits of the NCQA-accredited disease management services. Evaluator 2 awarded the additional five points for full NCQA accreditation because she did not distinguish between Amerigroup Florida and Amerigroup Corporation. She understood that a disease management program is a component of a managed health care plan, and she saw that Amerigroup had a full three- year NCQA accreditation for its disease management program and felt that equated to full accreditation. Evaluator 5 did not know the difference between Amerigroup Florida and Amerigroup Corporation. She thought that the references to the NCQA accreditation referred to Amerigroup Florida. Evaluators 3 and 4 did not award Amerigroup Florida any additional points relating to full accreditation with NCQA. The evaluation of Little Havana's response to Question 1 suffers a similar flaw. Little Havana's response stated: [Little Havana] received its certificate of authority to operate an HMO on April 9, 2012. Therefore, it is has not yet obtained accreditation as a health maintenance organization by a nationally recognized accrediting body. It intends to obtain NCQA accreditation within the time frame required by the Florida Statutes. [Little Havana], however, is currently accredited by the nationally recognized Accreditation Commission for Health Care, Inc. [ACHC] for its home health operations. A copy of the accreditation is attached. ACHC does not accredit managed care plans, including HMOs. The accreditation that Little Havana has from ACHC is for home health services Evaluators 1, 4, and 6 awarded Little Havana zero points for Question 1. Evaluators 2, 3, and 5 awarded Little Havana five points for having a national accreditation. If Little Havana had been awarded a contract, it would have provided the services through its HMO, which did not have a national accreditation. The points awarded to Little Havana for Question 1 were clearly erroneous and contrary to the ITN evaluation criteria. Question 11 was worth a maximum of 15 raw points, and stated: The respondent shall provide information regarding whether it is based in the State of Florida, as defined in s. 409.966(3)(c)3, F.S., are conducted by staff in-house or through contracted arrangements, located in the State of Florida. The evaluation criteria for Question 11 provided that the vendor would receive five points if it had its principal office in Florida and no parent of joint venture organization outside of Florida and five points if all functions were performed in Florida. An additional five points would be awarded if the vendor met both the requirements of having its principal office in Florida and performing all its functions in Florida. Little Havana's response to Question 11 indicated that Little Havana had always been a not-for-profit corporation incorporated in Florida, had it principal office in Florida, and performed all functions in Florida. Evaluator 6 failed to give Little Havana the additional five points for meeting both criteria of a principal office in Florida and performing all functions in Florida. His failure to award the additional five points was contrary to the ITN and clearly erroneous. Question 13 provided: The respondent shall state whether, in the past seven (7) years, it has voluntarily terminated all or part of a contract (other than a provider contract) to provide health care services, has had such a contract partially or fully terminated (with or without cause), has withdrawn from a contracted service area, or has requested a reduction in enrollment levels. The evaluation criteria for Question 13 provided that five points would be awarded for "no voluntary termination of all or part of a contract and no service area withdrawals." Zero points would be awarded "for any voluntary termination/withdrawals." United responded that it had withdrawn its Medicaid presence in two county markets within the past seven years due to available funding, medical trends, and lack of essential hospital or provider services. Evaluators 1 and 2 awarded United five points for the portion of the ITN response dealing with whether there had been any voluntary withdrawals from service areas. The awarding of these points was clearly erroneous and contrary to the evaluation criteria of the ITN. Question 14 provided: The respondent shall state whether there is any pending or recent (within the past seven years) civil criminal or administrative litigation against the respondent (to include respondent's affiliates and subsidiaries and its parent organization and that organization's affiliates and subsidiaries). If there is pending litigation or recent litigation against the respondent, describe the contract that is being litigated (if applicable), the damages being sought or awarded and the extent to which adverse judgment is/would be sought or awarded and the extent to which adverse judgment is/would be covered by insurance or reserves set aside for this purpose. One of the evaluation criteria was the "extent to which actual and anticipated judgments are not covered by insurance or reserves." The vendor would receive five points if there were no litigation; four points if sought or awarded damages covered by insurance or reserves; and zero points if not covered. Another of the evaluation criteria for Question 14 was "[t]he extent to which actual and anticipated litigation involves allegations of criminal misconduct (defined as dereliction of duty; or unlawful or improper behavior) as described in the complaint or other documents filed in the case. The vendor would receive five points if no criminal litigation that resulted in ad [sic] adverse outcome" and zero points would be awarded "if completed litigation involved criminal or intentional misconduct that resulted in an adverse outcome." Question 14 was evaluated by only two evaluators, Evaluators 12 and 13. They each awarded Amerigroup Florida four points for damages, which were covered by insurance or reserves, and five points for having no criminal litigation. Amerigroup Florida stated in its response to the ITN that in the past seven years there had been no criminal litigation against it, its parent corporation, or its affiliates. Amerigroup Florida stated that it had been involved in eight cases in which resolutions had been reached with no admission of liability and that these resolutions had been covered by either insurance of adequate reserve funds. Its response indicated that all pending litigation was covered by either insurance or reserves. Amerigroup Florida did divulge that Amerigroup Corporation had been involved in a qui tam action and stated: In August 2008, Amerigroup settled all claims related to a civil judgment against it in a qui tam action styled as United States of America and the State of Illinois, ex rel. Cleveland A. Tyson v. Amerigroup Illinois, Inc. and Amerigroup Corporation, U.S. District Court for the Northern District of Illinois, Eastern Division, Case No. 02-C-6074 (the "Litigation"). The Litigation, filed in 2002 by Mr. Tyson, a former employee of Amerigroup's former Illinois subsidiary, alleged that Amerigroup and its former Illinois subsidiary submitted false claims under the Medicaid program by discouraging or avoiding the enrollment of pregnant women and other recipients with special needs. The settlement is neither an admission of liability by Amerigroup nor a concession by the United States and State of Illinois that their claims were not well founded. Rather, the agreement states that the parties reached a full and final settlement to avoid the delay, uncertainty, and expense of further litigation. * * * EXTENT THAT JUDGMENTS ARE COVERED BY INSURANCE OR RESERVES. Sufficient insurance and reserves are maintained to cover all actual or anticipated judgments or settlements. In the Tyson case filed in 2002 and described above, existing available and unregulated funds at Amerigroup Corporation and financing proceeds were utilized to pay the settlement. The evaluation criteria in the ITN stated that five points would be awarded if there were no criminal litigation. Amerigroup Florida, its parent company, and affiliates did not have any criminal litigation in the past seven years. Thus, the awarding of five points by each of the evaluators was consistent with the evaluation criteria set forth in the ITN. The evaluation criteria stated that the evaluators were to determine the extent that actual and anticipated judgments were not covered by insurance or reserves and four points would be given if the sought or awarded damages were covered by insurance or reserves. Little Havana argues that because the settlement in United States ex rel Tyson v. Amerigroup Illinois and Amerigroup Corporation, Inc., 488 F. Supp. 2d 719 (N.D. Ill. 2007) was covered in part by financing that Amerigroup Florida should have been awarded zero points. The awarding of four points for this category is not inconsistent with the ITN evaluation criteria. The Tyson case was resolved by settlement rather than by judgment. The opinion in the Tyson was issued on March 13, 2007, and the parties in the Tyson case settled the case in 2008. In the Pre-Hearing Stipulation filed by the parties, Little Havana contends that the following errors were made in the evaluation of Question 15: "Evaluator 12 awarding Amerigroup Florida 3 points on a component of Question 15 and Evaluator 13 awarding United 15 points on Question 15." Little Havana did not address these alleged errors in its proposed recommended order. Question 15 required the following: The respondent shall state whether it is currently or has recently (within the past seven (7) years) been the subject of a criminal or civil investigation by a state or federal agency. If yes, provide an explanation with relevant details and the outcome (if applicable). If the outcome was against the respondent, respondent shall provide the corrective action plan implemented to prevent such future offenses. The respondent shall include information for the respondent as well as the respondent's affiliates and subsidiaries and its parent organization and that organizations' affiliate and subsidiaries. Respondents are not required to include information regarding EEO investigations that did not result in a cause finding, unless those investigations are ongoing. The evaluation criteria for Question 15 provided: [Item] 1. The number of criminal or civil (noncriminal investigations by any governmental agency or component, thereof) investigations of the parent, affiliates, subsidiaries or respondent resulting in an adverse determination to be defined as a civil or administrative sanction, fine, or penalty or criminal conduct or withhold of adjudication following a plea agreement or trial. [Item] 2. The extent to which the investigation of the parent, affiliate, subsidiaries or respondent resulting in an adverse determination. [Item] 3. The extent to which the corrective action plan effectively addressed the issue resulting in an adverse determination. [Item] 4. The extent to which the respondent, subsidiaries, affiliate or parent is currently under investigation by any law enforcement agency, any governmental agency or any component thereof, that will not be resolved prior to the award of the resulting Contract. * * * This section is worth a maximum of 20 raw points with each of the above components being worth a maximum of 5 points each as outlined below. For Item 1: 5 points for none; 4 points for one (1); 3 points for two (2) not involving respondent directly; 2 points for two (2) that included respondent; 0 for any exceeding above limits. For Item 2: 5 points if no investigations or no adverse determinations; 0 points for any other set of circumstances. For Item 3: 5 points for no investigations or corrective action that addressed all deficiencies; 0 points for no or no effective corrective action plan. For Item 4: 5 points for no known, ongoing investigations; 4 points for one (1); 0 points for any more than one (1). In response to Question 15, Amerigroup Florida identified one civil investigation involving it, which was settled, and some investigations involving affiliate companies, two of which involved cause findings by the Equal Employment Opportunity Commission (EEOC) and which were settled. Based on Amerigroup Florida's response to Question 15, Item 1, Evaluator 12 awarded zero points and Evaluator 13 awarded three points. Evaluator 12 conceded error in awarding zero points because the two cause findings by the EEOC did not involve Amerigroup Florida, meaning that Amerigroup Florida should have been awarded three points, the same number of points awarded by Evaluator 13. The awarding of three points by Evaluator 13 was consistent with the ITN evaluation criteria. In its response to Question 15, Amerigroup Florida stated that there was one investigation with a corrective action plan that addressed the deficiency. No evidence was presented that the corrective action plan did not address the deficiency. Based on Amerigroup Florida's response to Question 15, Evaluators 12 and 13 each awarded Amerigroup Florida five points.3/ The award of these points was consistent with the evaluation criteria for Question 15. In scoring United's response, Evaluator 13 awarded five points each for Items 1, 2, and 3, and Evaluator 12 award zero points for those items. Evaluator 13 reasonably concluded that there were no investigations that resulted in adverse determinations based on the wording of the evaluation criteria. There was some civil litigation listed in response to Question 14, but those were not based on investigations by a state or federal agency. Evaluator 13's award of five points for Item 2 was based on his interpretation of adverse determinations not to include settlements. His interpretation was reasonable. For Item 3, Evaluator understood that there were no adverse determinations; thus, there would have been no need for corrective action plans. His award of five points for Item 3 was reasonable. The parties have stipulated that even if all points were deducted from United as argued by Little Havana, United would still be ranked among the top seven vendors. The parties have stipulated that even if all point adjustments sought by Little Havana are made, Sunshine would still be ranked among the top seven vendors. The parties have stipulated that even if all point adjustments sought by Little Havana are made, Coventry would still be ranked among the top seven vendors. Little Havana did not present any evidence that AHCA's decision to award seven contracts instead of eight was contrary to AHCA's rules or policies, the statutes governing AHCA, or the specifications to the ITN.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered dismissing Little Havana's petition for failure to demonstrate that it was a responsive and responsible vendor who has standing to bring the protest. DONE AND ENTERED this 15th day of May, 2013, in Tallahassee, Leon County, Florida. S SUSAN BELYEU KIRKLAND Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 15th day of May, 2013.
