Conclusions THE PARTIES resolved all disputed issues and executed a Settlement Agreement. The parties are directed to comply with the terms of the attached settlement agreement. Based on the foregoing. this file is CLOSED. DONE and ORDERED on this the DR say of Mila. 2014, in Tallahassee, Florida. ZABETH DUDEK, fee — Agency for Health Care Administration Agency For Healthcare Administration V. Gary Marder D.O. C.1. No. 12-2625-000 Filed October 14, 2014 2:14 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: Robert Antonie Milne. Esq., Assistant Attorney General Florida Bar No.: 622338 Office of the Attorney General The Capitol, Suite PL-01 Tallahassee, Florida 32399-1050 Telephone: (850) 414-3713 Facsimile: (850) 922-6425 Robert.Milne@myfloridalegal.com Julie Gallagher, Esq., Julie. gallagher@akerman.com Akerman Senterfitt Suite 1200 106 Kast College Avenue Tallahassee, Florida 32301 Kelly Bennett, Chief Medicaid Program Integrity Finance and Accounting Health Quality Assurance Florida Department of Health Agency For Healthcare Administration V. Gary Marder 0.0. C.l, No. 12-2625-000 CERTIFICATE OF SERVICE THEREBY CERTIFY that a true and correct copy of the foregoing has been furnished to the above named addressees by U.S. Mail or other designated method on this the 7 A ot © S24. J Shoop, Esquire Agency Clerk State of Florida Agency tor Health Care Administration 2727 Mahan Drive, MS #3 Tallahassee, Florida 32308-5403 (850) 412-3630/FAX (850) 921-0158 Agency For Healthcare Administration V. Gary Marder D.O. C.I. No. 12-2625-000 STATE OF FLORIDA AGENCY FOR HEALTH CARE ADMINISTRATION STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Petitioner, DOAH CASE NO: 14-2456MPI PROVIDER NO.: 000455900 VS. CAL NO,: £2-2625-000 NPUNO.: 1730117003 LICENSE NO: 084773 GARY L. MARDER, D.O, Respondent, / SETTLEMENT AGREEMENT Petitioner, the STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, (“AHCA” or “Agency”), and Respondent, GARY L. MARDER, D.O. (SPROVIDER”), by and through the undersigned, hereby stipulate and agree as follows: 1, The parties enter into this agreement for the purpose of memorializing the resolution of this matter. 2. PROVIDER is a Medicaid provider in the State of Florida, provider number 000455900, and was a provider during the audit period. 3. In its Final Audit Report, dated October 7, 2013, the Agency notified PROVIDER. that a review of Medicaid claims performed by the Agency’s Office of (he Inspector General, Bureau of Medicaid Program Integrity (“MPI”), during the period of December 1, 2008, through May 31, 2011, indicated that certain claims, in whole or in part, were inappropriately paid by Agency for Health Care Administration v. Gary L. Marder, 0.0. C.L. No 12-2625-000 Settlement Agreement Page lofé Medicaid. The Agency sought repayment of this overpayment, in the amount of one hundred and fifty-four thousand five hundred and sixty-four dollars and six cents ($154,564.06). Additionally, the Agency applied sanctions in accordance with Sections 409,913(15), (16), and (17), Florida Statutes, and Rule 59G-9.070(7), Florida Administrative Code. Specifically, the Agency assessed the following sanctions against PROVIDER: a fine in the amount of thirty thousand nine hundred and twelve dollars and eighty-one cents ($30,912.81) for violation(s) of Rule 59G-9.070(7)(e), Florida Administrative Code; and costs in the amount of three thousand, five hundred and fifty-five dollars and twenty cents ($3,551.20). The iotal amount due was one hundred and cighty-nine thousand, twenty-eight dollars and seven cents ($189,028.07). 4, In response to the audit report dated October 7, 2013, PROVIDER filed a Petition for Formal Administrative Hearing. 5. Subsequent to issuance of the FAR, the PROVIDER submitted additional documentation and clarifications to AHCA regarding the alleged overpayment and sanctions amount. Based on further review AHCA has revised the final overpayment to one hundred forty five thousand, four hundred dollars and twenty-five cents ($145,400.25). The Agency also imposed a sanction in the amount of six thousand dollars ($6,000.00) and assessed cost in the amount of three thousand, seven hundred fifty-one dollars and twenty cents ($3,751.20). The total amount due arising from this case is one hundred fifty-five thousand, one hundred fifty-one hundred dollars and forty-five cents ($155,151.45). 6. In order to resolve this matter without further administrative proceedings, PROVIDER and AHCA agree as follows: Agency for Health Care Administration v. Gary L. Marder, D.O. C.I. No 12-2625-000 Settlement Agreement Page 2 of 6 6. 7. a. AHCA agrees to accept the payment set forth hercin in settlement of the after, fines and costs, arising from the above-referenced Audit. b. PROVIDER agrees to pay AHCA the sum of onc hundred fifty-five thousand, one hundred fifty-one dollars and forty-five cents ($155,151.45), The outstanding balance accrues at 10% interest per year. Within thirty (30) days of entry of the Final Order but by no later than December 10, 2014, whichever date is the last to occur, PROVIDER will make one payment of one hundred fifty-five thousand, one hundred fifty-one dollars and forty-five cents ($155,151.45). ce PROVIDER and AHICA agree that full payment, as set forth above, resolves and settles this case completely and releases both parties from any administrative or civil liabilities arising from the findings relating to the claims determined to have been overpaid as referenced in audit C.1. NO.: 12-2625-000, d. PROVIDER agrees that it shall not re-bill the Medicaid Program in any manner for claims that were not covered by Medicaid, which are the subject of the review in this case. Payment shall be made to: AGENCY FOR HEALTH CARE ADMINISTRATION Medicaid Accounts Receivable - MS #14 2727 Mahan Drive, Bldg, 2, Ste-200 Tallahassee, Florida 32308 PROVIDER agrees that failure to pay any monies due and owing under the terms of this Agreement shall constitute PROVIDER’S authorization for the Agency, without further Agency for Health Care Administration v. Gary L. Marder, D,O, C.J. No 12-2625-000 Settlement Agreement Page 3 of 6 notice, to withhold the total remaining amount due under the terms of this agreement from any monies due and owing to PROVIDER for any Medicaid claims. 8. AHCA reserves the right to enforce this Agreement under the laws of the State of Florida, the Rules of the Medicaid Program, and all other applicable rules and regulations. 9. This settlement does not constitute an admission of wrongdoing or error by either party with respect to this case or any other matter. 10, The signatories to this Agreement, acting in a representative capacity, represent that they are duly authorized to enter into this Agreement on behalf of the respective parties. 11, This Agreement shall be construed in accordance with the provisions of the laws of Florida. Venue for any action arising from this Agreement shall be in Leon County, Florida. 12, This Agreement constitutes the entire agreement between PROVIDER and AHCA, including anyone acting for, associated with or employed by them, concerning all matters and supersedes any prior discussions, agreements or understandings; there are no promises, representations or agreements between PROVIDER and AHICA other than as sel forth herein, No modification or waiver of any provision shall be valid unless a written amendment to the Agreement is completed and properly executed by the parties. 13. This is an Agreement of Settlement and Compromise, made in recognition that the parties may have different or incorrect understandings, information and contentions as to facts and law, and with each party compromising and settling any potential correctness or incorrectness of its understandings, information and contentions as to facts and law, so that no nusunderstanding or misinformation shall be a ground for rescission hereof. Agency for Health Care Administration v. Gary L. Marder, D.O. C.h. No 12-2625-000 Settlement Agreement Page 4 of § 14, PROVIDER expressly waives in this matter its right to any hearing pursuant to sections 120,569 or 120.57, Florida Statutes, the making of findings of fact and conclusions of law by the Agency, and all further and other proceedings to which it may be entitled by law or rules of the Agency regarding this proceeding and any and all issues raised herein. PROVIDER further agrees that it shall not challenge or contest any Final Order entered in this matter which is consistent with the terms of this settlement agreement in any forum now or in the future available to it, including the right to any administrative proceeding, circuit or federal court action or any appeal. 15. PROVIDER does hereby discharge the State of Florida, Agency for Health Care Administration, and its agents, representatives, and attorneys of and from all claims, demands, actions, causes of action, suits, damages, losses and expenses, of any and every nature whatsoever, arising owl of or in any way related to this matter, AHCA’s actions herein, including, but not limited to, any claims that were or may be asserted in any federal or state court or administrative forum, including any claims arising out of this agreement. 16. The parties agree to bear their own attorney’s fees and, except those cost specified to be paid by the Provider in this settlement agreement if any. 17, This Agreement is and shall be deemed jointly drafted and written by all parties to it and shal] not be construed or interpreted against the party originating or preparing it. 18. To the extent that any provision of this Agreement is prohibited by law for any reason, such provision shall be effective to the extent not so prohibited, and such prohibition shall not affect any other provision of this Agreement. Agency for Health Care Administration v. Gary L. Marder, D.O. C.1. No 12-2625-000 Settlement Agreement Page 5 of 6 49. This Agreement shall inure to the benefit of and be binding on cach party's successors, assigns, heirs, administrators, representatives and trustees. 20. All times stated herein are of the essence of this Agreement, ai. This Agreement shall be in full force and effect upon execution by the respective Dated: Wis, 2014 AGENCY FOR HEALTH CARE ADMINISTRATION 2727 Mahan TD rive, Bldg. 3, Mail Stop #3 llahagsee, 1. 2308-5403 Dated: uf; 7. 2014 Dated: 16/ f, » 2014 pated: /C/S?, 2014 Require 3 Counset piss Sec : mu jee —— ome ‘Assistant Attomey General Agency for Health Care Administration v. Gary L. Marder, D.0. C4. No 12-2625-000 Settlement Agreement Page 6 of 6 (Page 1 of 9) FLORIDA AGENCY FOR HEALTH CARE ADMINISTRATION, RICK SCOTT ELIZABETH DUDEK GOVERNOR SECRETARY ene CLIZAOC IN UUWER GOVERNOR SECRETARY CERTIFIED MAIL No.: 7009 2820 0001 5675 2068 October 7, 2013 Provider No: 000455900 NPI No: 1730117003 License No.: OS4773 Gary L. Marder 9580 S. US Highway 1 Port St. Lucie, FL. 34952-4217 In Reply Refer to FINAL AUDIT REPORT C.l.: No. 12-2625-000 Dear Provider: The Agency for Health Care Administration (Agency), Office of Inspector General, Bureau of Medicaid Program Integrity, has completed a review of claims for Medicaid reimbursement for dates of service during the period December 1, 2008, through May 31, 2011. A preliminary audit report dated October 15, 2012 was sent to you indicating that we had determined you were overpaid $145,400.25. Based upon a review of all documentation submitted, we have determined that you were overpaid $154,564.06 for services that in whole or in part are not covered by Medicaid. A fine of $30,912.81 has been applied. The cost assessed for this audit is $3,551.20. The total amount due is $189,028.07. Be advised of the following: (1) In accordance with Sections 409.913(15), (16), and (17), Florida Statutes (F.S.), and Rule . $9G-9.070, Florida Administrative Code (F.A.C.), the Agency shall apply sanctions for violations of federal and state laws, including Medicaid policy. This letter shall serve as notice of the following sanction(s): e A fine of $30,912.81 for violation(s) of Rule Section 59G-9.070(7) (e), F.A.C. (2) Pursuant to Section 409.913(23) (a), F.S., the Agency is entitled to recover all investigative, legal, and expert witness costs. . This review and the determination of overpayment were made in accordance with the provisions of Section 409.913, F.S. In determining the appropriateness of Medicaid payment pursuant to Medicaid policy, the Medicaid program utilizes procedure codes, descriptions, policies, limitations and requirements found in the Medicaid provider handbooks and Section 409.913, F.S. In applying for Visit AHCA online at 2727 Mahan Drive, MS# 6 hitp://ahca.myflorida.com Tallahassee, Florida 32308 Te meaner ne CR Re ARO IR RR A NR NEAL ET RM I A ce tne A meena A eke tn HH eae a emer eT Se ge (Page 2 of 9) Gary L. Marder 000455900 C.I. No.: 12-2625-000 Page 2 Medicaid reimbursement, providers are required to follow the guidelines set forth in the applicable rules and Medicaid fer, schedules, as, acomuleated jz. the, Madicridnglicxhaedkerks: billinabublstiatoar dbs and Medicaid fee schedules, as promulgated in the Medicaid policy handbooks, billing bulletins, and the Medicaid provider agreement. Medicaid cannot pay for services that do not meet these guidelines. Below is a discussion of the particular guidelines related to the review of your claims, and an explanation of why these claims do not meet Medicaid requirements. The audit work papers are attached, listing the claims that are affected by this determination. REVIEW DETERMINATIONS) 1. Medicaid policy addresses the requirements for enrollment and participation in the Medicaid program. In order to bill for services provided by another practitioner (physician, ARNP, PA), that practitioner must be enrolled in Medicaid, and must also be enrolled as part of a group practice for which you are listed as the pay-to provider. The billing must reflect the Medicaid number of the treating practitioner. You billed and received payment for services performed by another practitioner who was not enrolled in Medicaid and/or not in a group with you at the time the services were rendered. This finding applies to pathology claims. Payment made to you for these services is considered an overpayment. 2. A review of your medical records revealed that some services rendered were erroneously coded on the submitted claim. The appropriate code was applied and the payment adjusted. The difference between the amount paid and the payment for the correct procedure code is considered an overpayment. 3. Medicaid policy requires that services performed be medically necessary for the diagnosis and treatment of an illness. You bitled and received payments for services for which the medical records, when reviewed by a Medicaid physician consultant, indicated that the services provided did not meet the Medicaid criteria for medical necessity. The claims which were considered medically unnecessary were disallowed and the money you were paid for these procedures is considered an overpayment. 4. Medicaid policy defines the varying levels of care and expertise required for the evaluation and management procedure codes for office visits. The documentation you provided supports a lower level of office visit than the one for which you billed and received payment. This determination was made by a peer consultant in accordance with Sections 409.913 and 409.9131, F.S. The difference between the amount you were paid and the correct payment for the appropriate level of service is considered an overpayment. 5. Medicaid policy addresses the type of pathology services covered by Medicaid. You billed and received payment for laboratory tests that were performed outside your facility by an independent laboratory. Payments made to you in these instances are considered overpayments. 6. Medicaid policy specifies how medical records must be maintained. A review of your medical records revealed that some services for which you billed and received payment were not documented. Medicaid requires documentation of the services and considers payments made for services not appropriately documented an overpayment. (Page 3 of 9) Gary L. Marder 000455900 C1. No.: 12-2625-000 Page 3 10. 1 — Tn order ta qualify as a hasis for reimbursement. Medicaid policy requires that records must be In order to qualify as a basis for reimbursement, Medicaid policy requires that records must be signed and dated at the time of service, or otherwise attested to as appropriate to the media. Payments made to you in instances where the records submitted for review were non- contemporaneous, are considered overpayments. Medicaid policy requires a physician’s signature to substantiate the service billed. A review of your medical records revealed that in some instances, a rubber stamp was used in lieu of a physician’s written signature. Rubber stamp signatures must be initialed. The services that you billed and received payment for, in which a rubber stamp was utilized, are considered overpayments. Medicaid policy states that, to receive the physician 100% reimbursement, Advanced Registered Nurse Practitioners and Physician assistants must be supervised by the treating physician. Supervision is shown by the physician’s dated signature on the medical record. You billed Medicaid for services at the 100% reimbursement level when the medical record did not indicate that the service was supervised. Twenty percent of the reimbursement is considered an overpayment. Your records indicate instances of unbundling (using two CPT codes when one of these codes incorporates the elements of the other). The unbundled code has been denied. . As to Recipient #25: Medicaid requires a radiological physicist to be under the direct supervision of a physician (2010 Physician Services Coverage and Limitations Handbook, 2- 115). When Dr. Marder was out of the country he was not on the premises to provide direct supervision for these services. Medicaid requires indirect supervision by a physician for non- invasive radiology and nuclear medicine services (2010 Physician Services Coverage and Limitations Handbook, 2-112). Indirect supervision means that the physician must be reasonably available, so as to be physically present to provide consultation or direction in a timely fashion as required for appropriate care of the recipient. When Dr. Marder was out of the country, he was not available to provide indirect supervision for services. Dr. Marder was also unavailable to prescribe services for this recipient. CPT code 77401 is allowed once per patient per session regardless of the number of treatment areas. CPT code 77427 is billed per 5 treatments (not areas). CPT code 77336 is billed once per week. CPT code 77300 requires a prescription by the physician. Payments made to you for these services are considered an overpayment. OVERPAYMENT CALCULATION A random sample of 35 recipients respecting whom you submitted 388 claims was reviewed. For those claims in the sample, which have dates of service from December 1, 2008, through May 31, 2011, an overpayment of $15,169.48 or $39.09659794 per claim, was found. Since you were paid for a tota! (population) of 10,485 claims for that period, the point estimate of the total overpayment is 10,485 x $39.09659794 = $409,927.83. There is a 50 percent probability that the overpayment to you is that amount or more. (Page 4 of 9) Gary L. Marder 000455900 CE. No.: 12-2625-000 Page 4 We used the following statistical formula for cluster sampling to calculate the amount due the Agency: een NS Ua, —YB,y Where: N N E = point estimate of overpayment = F' b A, by 3,| U F = number of claims in the population = > B, isl 4, = total overpayment in sample cluster 8B, = number of claims in sample cluster U = number of clusters in the population N = number of clusters in the random sample N N Y = mean overpayment per claim= 5° A, / >)" B, eal get t = ¢ value from the Distribution of f Table All of the claims relating to a recipient represent a cluster. The values of overpayment and number of claims for each recipient in the sample are shown on the attachment entitled “Overpayment Calculation Using Cluster Sampling.” From this statistical formula, which is generally accepted for this purpose, we have calculated that the overpayment to you is $154,564.06 with a ninety-five percent (95%) probability that it is that amount or more. If you are currently involved in a bankruptcy, you should notify your attorney immediately and provide a copy of this letter for them. Please advise your attorney that we need the following information immediately: (1) the date of filing of the bankruptcy petition; (2) the case number; (3) the court name and the division in which the petition was filed (e.g., Northern District of Florida, Tallahassee Division); and, (4) the name, address, and telephone number of your attorney. One mere A Ce en IS RE RU NER REMY HOOT IE BAS gR on ACF nee NTR ee ae (Page 5 of 9) Gary L. Marder 000455900 C.L.No.: 12-2625-000 Page 5 If you are not in bankruptcy and you concur with our findings, remit by certified check in the amount of $189,028.07, which includes the overpayment amount as well as any fines imposed and assessed costs. The check must be payable to the Florida Agency for Health Care Administration. Questions regarding procedures for submitting payment should be directed to Medicaid Accounts Receivable, (850) 412-3901. To ensure proper credit, be certain you legibly record on your check your Medicaid provider number and the C.I. number listed on the first page of this audit report. Please mail payment to: Medicaid Accounts Receivable - MS # 14 Agency for Health Care Administration 2727 Mahan Drive Bldg. 2, Ste. 200 Tallahassee, FL 32308 Pursuant to section 409.913(25)(d), F.S., the Agency may collect money owed by all means allowable by law, including, but not limited to, exercising the option to collect money from Medicare that is payable to the provider. Pursuant to section 409.913(27), F.S., if within 30 days following this notice you have not either repaid the alleged overpayment amount or entered into a satisfactory repayment agreement with the Agency, your Medicaid reimbursements wil! be withheld; they will continue to be withheld, even during the pendency of an administrative hearing, until such time as the overpayment amount is satisfied. Pursuant to section 409.913(30), F.S., the Agency shall terminate your participation in the Medicaid program if you fail to repay an overpayment or enter into a satisfactory repayment agreement with the Agency, within 35 days after the date of a final order which is no longer subject to further appeal. Pursuant to sections 409.913(15)(q) and 409.913(25)(c), F.S., a provider that does not adhere to the terms of a repayment agreement is subject to termination from the Medicaid program. Finally, failure to comply with all sanctions applied or due dates may result in additional sanctions being imposed, You have the right to request a formal or informal hearing pursuant to Section 120.569, F.S. Ifa request for a formal hearing is made, the petition must be made in compliance with Section 28-106.201, F.A.C. and mediation may be available. If a request for an informal hearing is made, the petition must be made in compliance with rule Section 28-106.301, F.A.C. Additionally, you are hereby informed that ifa request for a hearing is made, the petition must be received by the Agency within twenty-one (21) days of receipt of this letter. For more information regarding your hearing and mediation rights, please see the attached Notice of Administrative Hearing and Mediation Rights. rere mE nr he et A NER ET RE EMER NAHE PA Pe ANN (Page 6 of 9) Gary L. Marder 000455900 CI. No.: 12-2625-000 Page 6 Anv onestions von mav have ahout this matter should be directed to: Kris Creel. Investigator. Agency Any questions you may have about this matter should be directed to: Kris Creel, Investigator, Agency for Health Care Administration, Medicaid Program Integrity, 2727 Mahan Drive, Mail Stop #6, Tallahassee, Florida 32308-5403, telephone (850) 412-4600, facsimile (850) 410-1972. AHCA Administrator Office of Inspector General Medicaid Program Integrity RO/KC/te Enclosure(s) Copies furnished to: Julie Gallagher Akerman Senterfitt Suite 1200 106 East College Avenue Tallahassee, FL 32301 Finance & Accounting (Interoffice mail) Health Quality Assurance (E-mail) Department of Health (E-mail) rr are rete seme mann AA A RP RE TE RATA RTA thE TPO RR RR UIA NRE neem A (Page 7 of 9) Gary L. Marder 000455900 CI. No.: 12-2625-000 Page 7 NOTICE OF ADMINISTRATIVE HEARING AND MEDIATION RIGHTS UNW 2 Ur ayia pays a es eee ee ee ee You have the right to request an administrative hearing pursuant to Sections 120.569 and 120.57, Florida Statutes. If you disagree with the facts stated in the foregoing Final Audit Report (hereinafter FAR), you may request a formal administrative hearing pursuant to Section 120.57(1), Florida Statutes. If you do not dispute the facts stated in the FAR, but believe there are additional reasons to grant the relief you seek, you may request an informal administrative hearing pursuant to Section 120.57(2), Florida Statutes, Additionally, pursuant to Section 120.573, Florida Statutes, mediation may be available if you have chosen a formal administrative hearing, as discussed more fully below. The written request for an administrative hearing must conform to the requirements of either Rule 28- 106.201(2) or Rule 28-106.301(2), Florida Administrative Code, and must be received by the Agency for Health Care Administration, by 5:00 P.M. no later than 21 days after you received the FAR. The address for filing the written request for an administrative hearing is: Richard J, Shoop, Esquire Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Mail Stop # 3 Tallahassee, Florida 32308 Fax: (850) 921-0158 Phone: (850) 412-3630 The request must be legible, on 8 % by 11-inch white paper, and contain: 1, Your name, address, telephone number, any Agency identifying number on the FAR, if known, and name, address, and telephone number of your representative, if any; 2. Anexplanation of how your substantial interests will be affected by the action described in the FAR; 3. A statement of when and how you received the FAR; 4, Fora request for formal hearing, a statement of all disputed issues of material fact; 5. Fora request for formal hearing, a concise statement of the ultimate facts alleged, as well as the rules and statutes which entitle you to relief; 6. For a request for formal hearing, whether you request mediation, if it is available; 7. For a request for informal hearing, what bases support an adjustment to the amount owed to the Agency, and A demand for relief. bad A formal hearing will be held if there are disputed issues of material fact. Additionally, mediation may be available in conjunction with a formal hearing. Mediation is a way to use a neutral third party to assist the parties in a legal or administrative proceeding to reach a settlement of their case. If you and the Agency agree to mediation, it does not mean that you give up the right to a hearing. Rather, you and the Agency will try to settle your case first with mediation. If you request mediation, and the Agency agrees to it, you will be contacted by the Agency to set up a time for the mediation and to enter into a mediation agreement, If a mediation agreement is not reached within 10 days following the request for mediation, the matter will proceed without mediation. The mediation must be concluded within 60 days of having entered into the agreement, unless you and the Agency agree to a different time period. The mediation agreement between you and the Agency will include provisions for selecting ‘the mediator, the allocation of costs and fees associated with the mediation, and the confidentiality of discussions and documents involved in the mediation. Mediators charge hourly fees that must be shared equally by you and the Agency. If a written request for an administrative hearing is not timely received you will have waived your right to have the intended action reviewed pursuant to Chapter 120, Florida Statutes, and the action set forth in the FAR shall be conclusive and final. Fa rn ta eet ER RRS ERR AMI ARERR REE OCR NTRR “ur RSI ye IRAE cen i RRO A en ener reppin cee” (Page 8 of 9) FLORIDA AGENCY FOR HEALTH CARE ADMINISTRATION Provider: 000455900 - GARY L MARDER Overpayment Catculation Using Cluster Sampling by Recip Name Dates Of Service: 12/1/2008 through §/31/2011 Dre ek einintn ie meet: - Number of recipients in population: Number of recipients in sample: Total payments in population: No. of claims in population: Recip # ONA OHO DYAA WH = NNN NWUNNN MHA BBB Bo BENBERORBNRSestsZaeR Totals: 35 Using Overpayment per claim method Overpayment per sample claim: Point estimate of the overpayment: Variance of the overpayment: Standard error of the overpayment: Half confidence interval: Overpayment at the 95 % Confidence level: Overpayment run on 10/3/2013 Page 1 of 1 _ Ase, Rannin 1,462 Case ID: 35 $820,719.19 Confidence level: 10,485 {value No. Claims Total Dollars 8 $352.56 3 $138.52 3 $185.90 8 $315.58 6 $730.96 1 $42 18 3 $185.90 5 $203.85 4 $244.06 1 $62.78 7 $398.88 14 $1,817.12 8 $1,272.44 2 $1,122.26 5 $250.73 6 $373.84 9 $954.69 28 $2,703.53 5 $460.73 13 $814.85 3 $119.10 3 $185.90 8 $529 48 4 $26.61 188 $5,610.14 1 $42.18 2 $71 29 4 $338.74 10 $789.00 8 $342.15 2 $97.10 1 $42.18 5 $446.94 10 $513.45 3 $50.16 388 $21,805.75 $39,09659794 $409,927.83 $22,807 ,115,837.63 $151,020.25 $255,363.77 $154,564.06 NPI: 1730117003 49 OROR NNN 12-2625-000 95% 1.690924 Overpayment $86 63 $64.96 $54.96 $89.78 $513.47 $0.00 $135.68 $32.18 $54.96 $0.00 $40.01 $1,489.43 $1,107.15 $1,122.26 $138.09 $121.98 $789.43 $2,306 56 $394.21 $514.63 $62.78 $54.96 $274.80 $0.00 $4,484.14 $0.00 $0.00 $164.88 $560.18 $109.92 $0.00 $0.00 $284.22 $116.75, $10.48 $15,169.48 (Page 9 of 9) If you choose to make payment, please return this page along with your check to: Ae nn ae Maa TIAA Qanen A deniniotratian Agency for Health Care Administration Medicaid Accounts Receivable 2727 Mahan Drive, Mail Stop #14 Tallahassee, Florida 32308 The check must be made payable to: Florida Agency for Health Care Administration Provider Name: Gary L. Marder Provider ID: 000455900 MPI Case #: 12-2625-000 Total Due: $189,028.07 Check Number: # Any questions you may have about this matter should be directed to: Kris Creel, Investigator, telephone (850) 412-4600, facsimile (850) 410-1972. Payment for Medicaid Program Integrity Audit 121 recente (Page 1 of 1) \ i ! ; | j | | | | | | 80 that Wé can retum the card to you. §§ Attach this card to the back of the mallpiece, or on the front if space permits. GARY L. MARDER 9580 S. US HIGHWAY 1 PORT ST LUCIE, FL 34952-4217 C.1 #12-2625-000 KC-re Olan eos wows wel 16.00. 7 Lo! lz Restricted Delivery? (xtra Fea) O ves Mander fomeeyce wee) ____ 700% 2820 OO01 SL?5 20b8 \’ nt a ASO RD TE PS Form 3811, February 2004 Domestic Return Receipt 102895-02.0-1540 UniTED States PosTAL SERVICE Class aoe Postage & Fees Paid ise aoe ¥ ™N 8 oe x FLORIDA AGENCY FOR HOSGEICARE APSO TRATIOON dar o 2727 Mahan Drive, MS #6 @& s Tallahassee, Florida 32308 } Medical Unit Wyapereaf fe Affelpheyhfo dtp fbeeag hy gaffod gag] iD, MPU panty 1D Return Reosist for terchandise
The Issue The issues in this case are: (1) Whether Respondent violated section 409.913, Florida Statutes, by failing to have documentation evidencing the receipt of current Zero Tolerance training in three employees' files; failing to have documentation showing that one employee has a high school diploma or equivalent; failing to have documentation of an implementation plan in one consumer's file; failing to have documentation of quarterly summaries in one consumer's file; and failing to have written policies and procedures addressing the staff training plan and specifying how pre-service and in- service activities will be carried out, including HIV/AIDS training, cardiopulmonary resuscitation training, and all other training mandated pursuant to section 381.0035; and (2) if so, the penalty that should be imposed.
Findings Of Fact The Parties and Medicaid Provider Agreement Petitioner is the state agency responsible for administering the Florida Medicaid Program2/ pursuant to chapter 409. Petitioner's duties include operating a program to oversee the activities of Medicaid recipients, providers, and their representatives to ensure that fraudulent and abusive behavior and neglect of recipients occur to the minimum extent possible, and to recover overpayments and impose sanctions as appropriate. § 409.913(1), Fla. Stat. To that end, Petitioner is authorized to conduct investigations of Medicaid providers to determine compliance with the Medicaid program. § 409.913(2), Fla. Stat. At all times relevant to this proceeding, Respondent was an enrolled Medicaid provider3/ providing residential rehabilitation and companion care services to the developmentally disabled pursuant to a valid Medicaid Provider Agreement ("MPA") with Petitioner.4/ The MPA establishes the terms and conditions of an enrolled provider's participation in the Medicaid program. A key condition is that the provider agrees to comply with all federal, state, and local laws, including rules, regulations, and statements of policy applicable to the Medicaid program, including the Medicaid Handbooks. The Florida Medicaid Developmental Disabilities Waiver Services Coverage and Limitations Handbook, dated November 2010 ("Disabilities Handbook"), and the Florida Medicaid Provider General Handbook, dated July 2008 ("General Handbook"), are among the laws and policies applicable to this proceeding. Petitioner's Inspection of Respondent's Facility On September 27, 2011, Ms. Gina Selwitz, an Inspector Specialist with Petitioner's Bureau of Medicaid Program Integrity ("MPI"),5/ along with another employee of Respondent's Bureau of MPI and a representative from the United States Department of Health and Human Services Centers for Medicare and Medicaid Services, conducted a site inspection at Respondent's facility, to determine Respondent's compliance with applicable Medicaid Program requirements. In the course of the inspection, Ms. Selwitz and the other inspection team members reviewed Respondent's employee records and recipient files for compliance with applicable Medicaid program requirements. They contemporaneously documented their findings on checklists. While at the facility, Ms. Selwitz hand-delivered a demand letter with an attached provider questionnaire form and a Certification of Completeness form to Respondent. The letter stated in pertinent part: Pursuant to Section 409.913, Florida Statutes ("F.S."), this is official notice that the Agency requests that documentation for services paid by the Florida Medicaid program to the above provider number. The Medicaid-related records to substantiate billing for the recipients identified on the enclosed printout are due within fifteen (15) calendar days of our receipt of this notification. In addition, please complete the attached questionnaire and submit it along with the copies of the Medicaid- related records. Please submit the documentation and the attached Certification of Completeness of Records to the Agency within this timeframe.... Respondent signed a form acknowledging receipt of the demand letter. Respondent completed and signed the provider questionnaire and the Certification of Completeness form and submitted them, along with the requested records, to Petitioner. By signing the Certification of Completeness form, Respondent verified that the records it provided were true and correct copies of all requested information. Petitioner received the records and completed forms on October 4, 2011. After the inspection was completed, Ms. Selwitz reviewed the checklists prepared during the inspection and determined that the following was missing from Respondent's files: (1) Documentation showing current Zero Tolerance training missing from employee files of Respondent's employees L.Q., A.G., and A.H.; (2) Documentation showing receipt of a high school diploma missing from the file of L.Q.; (3) Documentation of an implementation plan in the consumer file for A.G.-A.; (4) Documentation of quarterly summaries in the consumer file for L.G.; and (5) Written policies and procedures addressing the staff training plan and specifying how pre- service and in-service activities will be carried out, including HIV/AIDS training, C.P.R. training, and all other training mandated pursuant to section 381.0035. On February 22, 2011, Petitioner sent Respondent a Sanction Letter specifically identifying these deficiencies, stating that the deficiencies constitute violations of federal and state Medicaid laws, and imposing a total fine of $7,000.00. Findings Regarding Alleged Violations Zero Tolerance Training Ms. Selwitz testified that the inspection of Respondent's facility revealed that documentation evidencing the receipt of current Zero Tolerance training was missing from the employee files for A.G., A.H., and L.Q. Her testimony was supported by the inspection checklist prepared at the time of the inspection, indicating that L.Q.'s and A.H.'s employee files did not contain documentation showing that they had received Zero Tolerance training, and that the A.G.'s Zero Tolerance training had expired.6/ At hearing, Respondent conceded that A.G.'s Zero Tolerance training had expired. With respect to A.H., at hearing Respondent provided a document purporting to be an unofficial transcript from Tallahassee Community College showing that Respondent had completed Zero Tolerance in 2010, so that her training was current. However, Respondent acknowledged that this documentation was not in A.H.'s employee file at the time of Petitioner's inspection. With respect to L.Q., Respondent claims that documentation showing her current Zero Tolerance training was, in fact, present in her employee file, and that Petitioner's inspection team overlooked the documentation. Respondent noted that Delmarva7/ had inspected the facility approximately 15 days before Petitioner's inspection, and claimed that Delmarva's report did not show Zero Tolerance documentation deficiencies for L.Q.'s file. Respondent argues that this shows that that the Zero Tolerance documentation was present in L.Q.'s file when Petitioner inspected the facility and Petitioner's inspection team simply overlooked it. In support, Respondent provided a document purported to be the Delmarva inspection report. The persuasive evidence establishes that Respondent violated the requirement to maintain documentation of current Zero Tolerance Training in the employee files of A.G., A.H., and L.Q. At hearing, Respondent conceded that A.G.'s Zero Tolerance training had expired and that A.H.'s employee file did not contain the required Zero Tolerance Training documentation at the time Petitioner conducted its inspection. Further, Ms. Selwitz credibly testified that L.Q.'s employee file did not contain the required Zero Tolerance training information, and her testimony was buttressed by the contemporaneously-prepared inspection checklists. Respondent did not provide persuasive evidence to the contrary.8/ Accordingly, it is determined that Respondent violate Medicaid laws, rules, regulations, and policies by failing to have Zero Tolerance training documentation in the employee files for A.G., A.H., and L.Q. Educational Level Documentation for L.Q. Ms. Selwitz testified that during the inspection, the team determined that documentation was missing from L.Q.'s employee file showing that she possessed the required level educational training——i.e., a high school diploma or equivalent9/——to serve as direct care staff providing residential rehabilitation services. Ms. Selwitz's testimony was supported by the inspection checklist, which expressly noted the lack of high school diploma or general educational development ("G.E.D.") in L.Q.'s file and that a copy of L.Q.'s application for employment with Respondent stated that she had not graduated from high school. At hearing, L.Q., a director and employee of Respondent, testified on behalf of Respondent, and Respondent offered for admission into evidence a document purported to be L.Q.'s application for employment with Respondent. The application stated that Respondent had graduated from high school. L.Q testified that this application was completed in 2006 when she started working with Respondent, but subsequently testified that she graduated from high school in 2008. Her testimony was inconsistent with, and undercut the veracity of, the document Respondent offered to show that L.Q. met the educational training level requirement. Furthermore, even if L.Q. satisfied the applicable educational training requirements, Respondent did not provide credible evidence to overcome Petitioner's showing that the required documentation showing that training was not in L.Q.'s file when Petitioner inspected Respondent's facility. Accordingly, the credible, persuasive evidence establishes that Respondent violated Medicaid laws, rules, regulations, and policies by failing to have documentation of L.Q.'s educational status in her employee file. Inclusion of Implementation Plan in Consumer File Ms. Selwitz testified that the inspection also showed that a current Implementation Plan was not included in A.G.-A.'s consumer file, and her testimony was supported by the Residential Rehabilitation Services checklist that Petitioner's team completed at the time of the inspection. Respondent did not offer any testimony or other evidence to the contrary. Accordingly, Petitioner established that Respondent violated applicable Medicaid laws, rules, regulations, and policies by failing to have in its files a copy of the current Implementation Plan for consumer A.G.-A. Quarterly Summary Documentation in Consumer File Ms. Selwitz testified that Petitioner's inspection also revealed that Respondent failed to include a quarterly summary in L.G.'s consumer file documenting her progress, and this testimony was supported by the inspection checklists. At hearing, Respondent conceded this violation. Accordingly, Petitioner demonstrated that Respondent violated applicable Medicaid laws, rules, regulations, and policies by failing to have a quarterly summary in L.G.'s consumer file. Written Policies and Procedures Addressing Staff Training At hearing, Respondent conceded that at the time of the inspection, it failed to have written policies and procedures addressing the staff training plan and specifying how pre-service and in-service activities will be carried out, including HIV/AIDS training, C.P.R. training, and all other training mandated pursuant to section 381.0035. Accordingly, it is determined that Respondent violated applicable Medicaid laws, rules, regulations, and policies by failing to maintain this required documentation.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Agency for Health Care Administration enter a Final Order determining that Respondent violated federal and state Medicaid laws as charged in the February 22, 2012 Sanction Letter, and imposing a fine of $7,000.00. DONE AND ENTERED this 3rd day of December, 2012, in Tallahassee, Leon County, Florida. S CATHY M. SELLERS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 3rd day of December, 2012.
The Issue Whether a provision contained in a Settlement Agreement of a federal lawsuit is the statement the Department of Children and Family Services (Respondent) relied upon to deny Petitioner, G.F., on behalf of minor child G.F. (Student G.F.), Medicaid waiver benefits and constitutes an invalid exercise of delegated legislative authority on the grounds that the statement in question was not promulgated as a rule; and Whether Petitioners can challenge a provision which is contained in the Developmental Services Waiver Services Florida Medicaid Coverage and Limitations Handbook, October 2003, in Florida Administrative Code Rule 59G-8.200(12), as an invalid exercise of delegated legislative authority when the agency which adopted the rule is not a party to this proceeding.
Findings Of Fact Medicaid is a cooperative federal/state program in which Florida participates in partnership with the national government. Medicaid provides medically necessary health care. In addition to shouldering administrative and regulatory responsibilities, Florida partially funds the Florida Medicaid Program, contributing about 42 percent of the money budgeted for the program's operation. Federal funds make up the balance. The Florida Retail Federation, Inc. v. Agency for Health Care Administration, Case No. 04-1828RX (DOAH July 19, 2004). Under the statutory scheme, states who participate in Medicaid are required to have a state plan. See 42 C.F.R. § 430.10. A participating state may also grant waivers to their state plan pursuant to Section 1915(c) of the Social Security Act. See 42 C.F.R. § 430.25. Each participating state must designate a single-state agency to administer or supervise administration of the state plan. The state plan must also specify whether the agency that determines eligibility is the Medicaid agency or the single-state agency for the financial assistance program under Title IV-A. See 42 C.F.R. § 431.10. The State of Florida has identified AHCA as the single-state agency to administer the plan and the previously identified Respondent to determine eligibility. § 409.902, Fla. Stat. (2002).2/ AHCA is required to enter an interagency agreement with Respondent and other agencies "to assure coordination and cooperation in serving special needs citizens." § 408.302(1), Fla. Stat. It is required that Respondent approve and have input with regard to AHCA's rules when the rules directly impact the mission of Respondent. Access to quality healthcare is "an important goal" for all citizens in Florida. § 408.301, Fla. Stat. Persons served by Respondent are citizens with special needs, and it is the policy of Florida that persons with special needs are adequately and appropriately served. The Florida Legislature recognizes that the Medicaid program is "an intricate part of the service delivery system for the special needs citizens" in Florida. AHCA is not a service provider and does not develop or direct programs for special needs citizens, such as Student G.F. § 408.301, Fla. Stat. In fact, it is Respondent that plays the vital role to assure that "the needs of special citizens are met." Under the Medicaid program in Florida, AHCA is the "single state agency authorized to make payments for medical assistance and related services." § 409.902, Fla. Stat. However, Respondent is responsible for "Medicaid eligibility determinations, including, but not limited to, policy, rules, . . . as well as the actual determination of eligibility." Specifically, Respondent administers the Developmental Disabilities Home and Community-Based Services Medicaid Waiver Program (HCBS Medicaid Waiver Program) in Florida, and under Section 409.919, Florida Statutes, is authorized and required to enact administrative rules, as necessary, to fulfill its obligation to comply with federal and state Medicaid law. Student G.F. is a developmentally disabled child with multiple developmental disabilities, including autism, mental retardation, and profound deafness. Student G.F.'s combination of disabilities have resulted in significant cognitive impairment, social withdrawal, violence, and self-injurious behavior. This has resulted in extreme challenges in communication and acquisition of skills related to daily living. In 2000, Student G.F. was placed at the NDA in Mount Dora, Lake County, Florida, as a day student under the treatment of Dr. Cohen, as part of Student G.F.'s Individual Education Plan under the Federal Individual with Disabilities Education Act. Approximately five months later, Dr. Cohen determined that residential placement of Student G.F. was medically necessary. Petitioner asserts that the NDA in Mount Dora, Florida, is the only facility that could provide residential habilitation services for Student G.F. and treat her complex array of disabilities. The NDA is a certified Medicaid waiver provider for Respondent in District 10. On or about August 1, 2001, Deloris Battle, an independent contractor who provides support coordination services to recipients under the HCBS Medicaid Waiver Program, prepared the Florida Status Tracking Survey for Student G.F. Respondent's surveyor concluded that Student G.F. was in a state of crisis and required residential placement for habilitation services. Petitioner School Board reached an understanding with Battle whereby the parties would share in the cost of services for Student G.F. at the NDA. Petitioner School Board would fund the cost of educational services, and Respondent would fund the cost of medical and residential habilitation services. Respondent's share of the cost of the services would be funded by the HCBS Medicaid Waiver Program. Student G.F. qualifies as developmentally disabled and is eligible for Medicaid services pursuant to Chapter 409, Florida Statutes. Student G.F. is also eligible for services under the HCBS Medicaid Waiver Program. Battle submitted a cost plan to Respondent's district's office that requested HCBS Medicaid Waiver Program funding for Student G.F.'s residential placement at NDA. Battle had no authority to commit Respondent to expend any Medicaid waiver funds without approval. The cost plan submitted by Battle was not sent to Tallahassee for approval. Approval was delayed at the district level until it was learned that Petitioner School Board agreed to pay for the residential placement of Student G.F. In May 2002, Petitioner School Board and G.F. were advised that Medicaid waiver funding for Student G.F.'s residential placement at the NDA was denied. Respondent offered no other options for service. Petitioner School Board agreed to fund Student G.F.'s residential placement at the NDA for a trial period. Such funding by Petitioner School Board has continued, because Petitioners believed that the NDA is the only facility that can treat Student G.F.'s array of disabilities. Petitioner School Board elected to fund the entire cost of Student G.F.'s residential placement under protest. The Dispute Petitioners brought this instant proceeding because they believe that Respondent's denial of Medicaid waiver funding for Student G.F.'s residential placement was (and continues to be) based on an agency statement by Respondent that was not adopted as a rule, in violation of Sections 120.54 and 120.56, Florida Statutes (2004). In 1998, Prado-Steinman v. Bush, Case No. 98-6496-CIV- FERGUSON, was filed in the United States District Court for the Southern District of Florida. One of the defendants was the Florida Department of Children and Family Services. On June 27, 2000, a settlement agreement was signed by the parties to the Prado-Steinman litigation. Petitioners allege that the initial basis for Respondent's denial of funding for Student G.F.'s placement was an agency statement purportedly based entirely upon Respondent's interpretation of the settlement agreement reached in Prado- Steinman, that Medicaid waiver funding is unavailable for facilities with a capacity to house more than 15 persons. Specifically, page 16 of the Settlement Agreement dated June 29, 2000, paragraph (F)(1), "Group Home Placement" reads as follows: The parties agree that they prefer that individuals who are enrolled in the Waiver live and receive in smaller facilities. Consistent with this preference, the parties agree to the following: The Department will target choice counseling to those individuals, enrolled on the Waiver and who presently reside in residential habilitation centers (where more than 15 persons reside and receive services). The focus of this choice counseling will be to provide information about alternative residential placement options. The Department will begin this targeted choice counseling by December 1, 2000, and will substantially complete this choice counseling by December 1, 2001. See generally Prado-Steinman v. Bush, 221 F.3d 1266 (11th Cir. 2000). At paragraph 24 of the Amended Petition, Petitioners assert that the alleged agency statement, which has not been adopted as a rule, are the statements by Respondent that the agency will not authorize Medicaid waiver funding for facilities with a greater number of beds than specified in the agreement and that the NDA is not an eligible Medicaid waiver facility under the agreement. The settlement agreement does not prohibit placement of individuals who are enrolled in the HCBS Medicaid Waiver Program with specific facility sizes. The portion of the agreement that refers to residential facilities concerns Group Home Placements, as quoted in paragraph 19 above, and provides that Respondent will (1) counsel residents of residential habilitation centers where more than 15 persons reside about alternative residential placements; (2) will develop alternative residential placements; (3) will encourage the use of client advocates for residents of residential habilitation centers who have no family, friends, or guardian to advocate on their behalf; and (4) will not fill vacancies in residential habilitation centers with individuals enrolled on the waiver. Paragraph J of the Settlement Agreement, found on page 25, provides that Respondent will continue to develop residential program models that encourage an environment for self- determination. Further, Respondent will emphasize to support coordinators that the annual needs assessment for waiver recipients should include an assessment of the need for alternative placement. The focus of the language is to move more clients into residences meeting the policy and philosophy of Chapter 393, Florida Statutes. Parents were given the opportunity to take their children out of institutions and into less restrictive environments. At paragraph 27, the Amended Petition alleges that the use of the Settlement Agreement "to adversely affect the interests of the Petitioners is an invalid exercise of delegated legislative authority" as defined in Subsection 120.56(4), Florida Statutes (2004). The Amended Petition makes no allegation that the alleged agency statement, which has not been adopted as a rule is arbitrary or capricious, even if that standard were applicable to a petition under Subsection 120.56(4), Florida Statutes (2004), nor does the Amended Petition allege that the alleged agency statement is in violation of federal law. The Amended Petition does not include AHCA as a party and does not mention Florida Administrative Code Rule 59G-8.200, although, Petitioners have been aware of the rule since early in this rule-challenge proceeding. The Amended Petition does not cite any proposed or existing rule or delineate a challenge to any proposed or existing rule, regardless of the promulgating agency. The Amended Petition does not allege that Florida Administrative Code Rule 59G-8.200 somehow violates federal law. AHCA began rule-making to adopt a handbook for the HCBS Medicaid Waiver Program in October 2001. Rule-making was initiated to meet the requirements of the federal Center for Medicare and Medicaid Services. It requires the states who participate to promulgate handbooks. AHCA published its notice of rule development in Volume 27, No. 52 of the Florida Administrative Weekly dated December 28, 2001. AHCA held seven rule workshops concerning the Medicaid Handbook: two in Tallahassee (January 14, 2002, and February 14, 2002); one in Pensacola (February 27, 2002); one in Jacksonville (February 19, 2002); one in Tampa; one in Orlando (February 22, 2002); and one in Fort Lauderdale (February 15, 2002). The workshops were attended by a large number of persons and representatives of advocacy groups. The rule notice was published in Volume 28, No. 18 of the Florida Administrative Weekly dated May 3, 2002. A public hearing was held on May 28, 2002. Subsequent to the public hearing, a notice of change was filed and a second public hearing was held on August 19, 2002. Florida Administrative Code Rule 59G-8.200, and the Medicaid Handbook incorporated therein by reference, were originally adopted on October 27, 2002. It has since been amended. Florida Administrative Code Rule 59G-8.200(12) currently provides in pertinent part: (12) Developmental Services Waiver – General. This rule applies to all Developmental Services Waiver Services providers enrolled in the Medicaid program. All Developmental Services Waiver Services providers enrolled in the Medicaid program must comply with the Developmental Services Waiver Services Florida Medicaid Coverage and Limitations Handbook, October 2003, incorporated by reference, and the Florida Medicaid Provider Reimbursement Handbook, Non-Institutional 081, October 2003. Both handbooks are available from the Medicaid fiscal agent. The Developmental Disabilities Waiver Services Provider Rate Table, November 2003, is incorporated by reference. The Developmental Disabilities Waiver Services Provider Rate Table is available from the Medicaid fiscal agent. Chapter 1 of the Handbook is entitled, "Purpose, Background and Program Specific Information," and contains general definitions. "Licensed Residential Facility" is defined at pages 1-3 as: Facilities providing room and board, and other services in accordance with the licensing requirements for the facility type. Community-based beneficiaries with developmental disabilities may receive DS waiver services while residing in: Group and foster homes licensed by the Department of Children and Families in accordance with Chapter 393, Florida Statutes, and Chapter 409, Florida Statutes. Comprehensive, transitional education program facilities, licensed by the Department of Children and Families in accordance with Chapter 393, Florida Statutes. Assisted Living Facilities, and Transitional Living Facilities, licensed by the Agency for Health Care Administration in accordance with Chapter 400, Florida Statutes. Residential Habilitation Centers and any other type of licensed facility not mentioned above, having a capacity of 16 or more persons, if the beneficiary has continuously resided at the facility since August 8, 2001, or prior to this date. "Institution" is generally understood by persons in the disabilities profession as a facility with more than 15 beds that is self-contained, providing all the needs of its residents, as opposed to a more home-like environment. The "best practice" model for developmental disabilities services is a group home with six beds. Respondent interprets these provisions to mean that Medicaid waiver funding is unavailable for a residential placement if the facility has a capacity of 16 or more persons, unless the beneficiary has continually resided at the facility since August 8, 2001, or prior to that date. The Medicaid Handbook is incorporated by reference in AHCA's rule. (Fla. Admin. Code R. 59G-8.200) Respondent has not promulgated a separate administrative rule pursuant to Chapter 120, Florida Statutes (2004), that incorporates the Medicaid Handbook or any part of it into its own rules. However, it did cooperate and coordinate with AHCA when the rule and Medical Handbook were adopted, as required by Subsection 408.302(1), Florida Statutes. AHCA and Respondent have entered into an agreement by which Respondent has agreed to implement the HCBS Medicaid Waiver Program. AHCA retains the authority and responsibility to issue policy, rules, and regulations concerning the HCBS Medicaid Waiver Program, and Respondent is required to operate the program in accordance with those policies, rules, and regulations. Section 409.919, Florida Statutes, and AHCA's rule incorporating the Medicaid Handbook by reference, supplied Respondent with the necessary rule authority to deny the funding. Petitioners have failed to prove that page 96 of the Settlement Agreement dated June 29, 2000, paragraph (F)(1) in the Prado-Steinman case, was relied upon to deny Student G.F. Medicaid waiver benefits. Petitioners have failed to prove that page 16 of the Settlement Agreement was an unpromulgated rule. Petitioners cannot challenge a provision in the Medicaid Handbook, which has been adopted by reference in Florida Administrative Code Rule 59G-8.200(12), when the agency which adopted the rule is not a party to this proceeding.
Conclusions THE PARTIES resolved all disputed issues and executed a Settlement Agreement. The parties are directed to comply with the terms of the attached settlement agreement. Based on the foregoing, this file is CLOSED. DONE and ORDERED on this the QIhay of Qucenater > 201\, in Tallahassee, Florida. bd WM fer ELIZABETH DUDEK, SECRETARY Agency for Health Care Administration 1 Filed January 5, 2012 11:44 AM Division of Administrative Hearings A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO A JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A SECOND COPY ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED. Copies furnished to: L. William Porter Assistant General Counsel Agency for Health Care Administration Office of the General Counsel (Interoffice) Carlos Muniz Deputy Attorney General/Chief of Staff Office of the Attorney General Department of Legal Affairs (electronic mail) Michael Verbitsky, President 2024 Hollywood Boulevard Hollywood, Florida 33020 (U.S. Mail) Eleanor M. Hunter Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 Mike Blackburn, Bureau Chief, Medicaid Program Integrity Finance and Accounting Health Quality Assurance Department of Health CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished to the above named addressees by U.S. Mail, Laserfiche or electronic mail on this the fay of denne 2012. Agency Clerk State of Florida Agency for Health Care Administration 2727 Mahan Drive, MS #3 Tallahassee, Florida 32308-5403 (850) 412-3630/FAX (850) 921-0158 SETTLEMENT AGREEMENT THIS SETTLEMENT AGREEMENT (hereinafter referred to as “ Agreement”) is entered between the STATE OF FLORIDA, acting through its MEDICAID FRAUD CONTROL UNIT (hereinafter referred to as “MFCU”) of the OFFICE OF THE ATTORNEY GENERAL (hereinafter referred to as “OAG”) and WELLSCRIPTS, LLC (hereinafter referred to as “WELLSCRIPTS”) and MICHAEL VERBITSKY (bereinafter referred to as “VERBITSKY”), acting through its authorized representative. As a preamble to this Agreement, the MFCU, WELLSCRIPTS, and VERBITSKY agree to the following: A. “WELLSCRIPTS,” “VERBITSKY,” and “Parties” Defined: As used in this Agreement, the term “WELLSCRIPTS” is defined as WELLSCRIPTS, LLC, an inactive Florida for Limited Liability Company, its current and former parent entities, predecessors, successors, and assigns, including the agents, employees, officers, and directors, and independent contractors of WELLSCRIPTS, their successors and assigns, to the extent such agerits and independent contractors were acting for or on behalf of WELLSCRIPTS. WELLSCRIPTS was dissolved on September 26, 2008. VERBITSKY was the president and owner of WELLSCRIPTS during the Covered Conduct. Collectively, WELLSCRIPTS, VERBITSKY, and MFCU are the “Parties,” as used herein. B. “Investigation” of the “Covered Conduct”: The MFCU conducted an investigation of WELLSCRIPTS concerning WELLSCRIPTS’ alleged improper claims for and receipt of Medicaid payments from Florida’s Agency for Health Care Administration (hereinafter Page 1 of 11 referred to as “AHCA”). As used herein, the term “Investigation” shall mean MFCU’s investigation into WELLSCRIPTS. As a result of this investigation, the MFCU alleges that WELLSCRIPTS improperly billed the Florida Medicaid program $346,887.88 for certain drugs. This calculation was based on an audit of the top seven (7) drugs billed by Wellscripts. Also, the MFCU alleges that WELLSCRIPTS was improperly reimbursed for medications billed to two assisted living facilities totaling $17,139.16. WELLSCRIPTS submitted these claims through Medicaid Provider Number 0268208-00. The MFCU alleges that the total amount improperly billed by WELLSCRIPTS to Florida’s Medicaid program is $364,027.04. This MFCU-investigated conduct is the “Covered Conduct,” as used hereafter. The “Covered Conduct” does not include any conduct or potential claims that WELLSCRIPTS may have administratively against AHCA or any other entity for billed services which have not yet been paid that are outside the scope and/or time frame of the conduct detailed above. . MFCU’s Claims: MFCU contends it has certain statutory and common-law civil claims against WELLSCRIPTS as a result of the Covered Conduct. . Motivation to Resolve Claims: The Parties desire to conclude the aforementioned Investigation into the Covered Conduct and to settle and compromise on all claims, including, but not limited to, any claims pursuant to Sections 68.081 through 68.092 Florida Statutes, against WELLSCRIPTS arising out of the Investigation that the MFCU either asserted or maintained against WELLSCRIPTS or could have asserted or maintained against WELLSCRIPTS. The Parties enter into this full and final Agreement Page 2 of 11 to avoid the delay, uncertainty, inconvenience, and expense of protracted litigation of these claims. NOW, THEREFORE, in consideration of the premises and the mutual promises, agreements, obligations, and covenants set forth, and for good and valuable consideration as stated herein, the Parties agree as follows: 1, Settlement Terms: a. Settlement Amount: WELLSCRIPTS’ relinquishment of all rights and interests in the monies previously seized from Bank of America Account Number 003738055311 totaling $219,193.66 plus interest. The monies previously seized are currently being held in the OAG’s Trust Account. b. Return of Funds Seized: The OAG agrees to abandon the claim for forfeiture of the seized currency from Bank of America Account Numbers 003671024535 and 003672757995 in the names of Michael Verbitsky and Ricki R. Kaneti totaling $22,253.27 and will return the funds to Michael Verbitsky and Ricki R. Kaneti. The funds will be returned to Michael Verbitsky and Ricki R. Kaneti’s counsel via check to Nason, Yeager, Gerson, White & Lioce P.A.’s trust account at Sabadell United Bank, Account Number 0215000258. c, Upon the signing of this Agreement by both parties, the MFCU will transfer to AHCA, $219,193.66 plus interest to satisfy the Medicaid program loss. d. Upon the signing of this Agreement by both parties, OAG agrees to voluntarily dismiss the Civil Action case number 2010 CA 015157 (09), which was filed in the Seventeenth Judicial Circuit of Broward County, FL on April 6, 2010. OAG also agrees to voluntarily dismiss the Civil Forfeiture Action case number 2007 Page 3 of 11 CA 000765 (14), which was filed in the Seventeenth Judicial Circuit of Broward County, FL on January 11, 2007. 2. MFCU’s Release: Subject to the exceptions in Paragraph 3 (“Scope of Release”) and Paragraph 4 (“Bankruptcy Provisions”), upon full execution of this Agreement by all Parties and WELLSCRIPTS’ simultaneous remittance to the MFCU of the settlement amount as provided in Paragraph 1, the MFCU agrees to release WELLSCRIPTS from any and all civil and administrative actions, causes of action, obligations, liabilities, claims, or demands for compensatory, special, punitive, exemplary, or treble damages, or demand whatsoever in law or in equity, which were asserted or maintained or could have been asserted or maintained, against WELLSCRIPTS based upon or arising out of the Investigation of the Covered Conduct specifically as defined in Preamble Paragraph B. However, the Agreement will have no actual or intended effect until executed by MFCU’s authorized representative. In the event WELLSCRIPTS makes payment of the Settlement Amount prior to full execution of this Agreement, MFCU may deposit the Settlement Amount in an escrow account pending execution and such deposit shall not be construed as acceptance of the terms of this Agreement. 3. Scope of Release: Notwithstanding any term of this Agreement, the following are specifically reserved and excluded from the scope and terms of this Agreement as to any entity or person, including WELLSCRIPTS: a. MFCU, AHCA, or other appropriate law enforcement or regulatory agency or private party suit against WELLSCRIPTS or any predecessor, successor, director, officer, employee, assign or agent of WELLSCRIPTS for: Page 4 of 11 i. Any administrative or civil cause of action for any violation of law arising out of the covered conduct and not encompassed within the Investigation as defined in Preamble Paragraph B; or ii. Any criminal liability. Accordingly, WELLSCRIPTS agrees not to assert the defenses of res judicata, collateral estoppel, excessive fines, or double jeopardy as to actions described in subparagraphs (a)(1) and (a)(2) of this Paragraph 3. b. Any actions or matters involving the exclusion of WELLSCRIPTS or other entities or persons from Federal or State, including Florida, health care programs; c. Any administrative action(s) relating to professional licensure or adjudication of claims by persons or entities who are not parties to this Agreement; d. Any claims based upon such obligations as are created by this Agreement, e. Any liability to the State of Florida, including MFCU and OAG, for any conduct other than the Covered Conduct; f. Any express or implied warranty claims or other claims for defective or deficient products or services, including quality of goods and services, provided by WELLSCRIPTS; g. Any claims for personal injury or property damage or for other consequential | damages arising from the Covered Conduct; ! h. Any claims based on a failure to deliver items or services due; and i. Any action against a healthcare professional, including WELLSCRIPTS and any of its employees or agents, for practicing without the necessary license or certification. Page S$ of 11 . Bankruptcy Provisions: The Parties warrant and agree to the following bankruptcy provisions: a. WELLSCRIPTS warran ts that it has reviewed its own financial position and WELLSCRIPTS is solvent within the meaning of Title 11 of the United States Code §§547(b)(3) and 548 (a)(1)(B)Gi)@, and will remain solvent following its payment to the MFCU of the Settlement Amount. _ No Admission of Fault: This Agreement, any exhibit or document referenced herein, any action taken to reach, effectuate, or further this Agreement, and the terms set forth herein, shall not be construed as, or used as, an admission by or against any of the Parties of any fault, wrongdoing, or liability whatsoever. Entering into or carrying out this Agreement, or any negotiations or proceedings related thereto, shall not in any event be construed as, or deemed to be evidence of, an admission or concession by any of the Parties, or to be a waiver of any applicable defense. However, with the exception of certain bankruptcy provisions in Paragraph 4, nothing in this Agreement, including this Paragraph 5, shall be construed to limit or to restrict WELLSCRIPTS’ right to utilize this Agreement, or payments made hereunder, to assert and maintain the defenses of res judicata, collateral estoppel, payment, compromise and settlement, accord and satisfaction, or any legal or equitable defenses in any pending or future legal or administrative action or proceeding arising out of the specific subject matter of the Investigation, as defined in Preamble Paragraph B. WELLSCRIPTS does not admit MFCU’s contentions that arise from its Investigation of the Covered Conduct, set forth in Preamble Paragraph B, and specifically denies WELLSCRIPTS knowingly submitted any claims in Page 6 of 11 violation of state or federal law. This Agreement, and the payment, promises, and release provided hereunder, are not and shall not be construed to be an admission of liability or any acknowledgment of the validity of any of the claims that were or that could have been asserted by the MFCU against WELLSCRIPTS, arising out of the: Investigation, which liability or validity is hereby expressly denied by WELLSCRIPTS. . Denied Medical Claims: The Settlement Amount shall not be decreased as a result of the denial of claims for payment now being withheld from payment by AHCA or its intermediary agents related to the Covered Conduct. WELLSCRIPTS agrees not to resubmit to Medicare, Medicaid, or any State or Federal payer any previously denied claims related to the Covered Conduct and agrees not to appeal any such denials of claims. However, WELLSCRIPTS reserves the right to appeal and/or resubmit previously denied claims or seek administrative remedies with AHCA of those claims which are outside the scope of the Covered Conduct. . Complete Resolution: The Parties have agreed that the terms of this Agreement constitute a complete resolution and settlement of the claims asserted against WELLSCRIPTS by the MFCU, as well as the claims that could have been asserted against WELLSCRIPTS by the MFCU arising out of or as a result of the Investigation described in Preamble Paragraph B. Upon WELLSCRIPTS’ continued fulfillment of its obligations under this Agreement, and relinquishment of all rights and interests in the monies seized provided in Paragraph 1, the Investigation, as defined in Preamble Paragraph B, shall be concluded. Page 7 of 11 10. il. 12. 13, 14, Survival: This Agreement shal! be binding upon and inure to the benefit of the Parties and their successors, transferees, heirs, and assigns. Merger: This Agreement constitutes the entire agreement between the Parties with regard to the subject matter contained herein and all prior negotiations and understandings between the Parties shall be deemed merged into this Agreement. No External Representations: No representations, warranties, or inducements have been made by the MFCU concerning this Agreement other than those representations, warranties, and covenants contained in this Agreement. No Oral Modifications or Waivers: No waiver, modification, or amendment of the terms of this Agreement shall be valid or binding unless in writing, signed by the Party to be charged, and then only to the extent set forth in such written waiver, modification, or amendment. Failure of Strict Performance: Any failure by any Party to the Agreement to insist upon the strict performance by any other Party of any of the provisions of this Agreement shall not be deemed a waiver of any of the provisions of this Agreement, and such Party, notwithstanding such failure, shall have the right thereafter to insist upon the specific performance of any and all of the provisions of this Agreement. Choice of Law: This Agreement shall be governed by, and construed and enforced in accordance with the laws of the State of Florida, without regard to its conflict of law principles. Release of Florida; WELLSCRIPTS fully and finally releases the MFCU, the OAG, and the State of Florida, its agencies, employees, servants, and agents from any claims (including attorney’s fees and costs of any kind) that WELLSCRIPTS has Page 8 of 11 15. 16. 17. 18. asserted, could have asserted, or may assert in the future against the MEFCU, the OAG, or the State of Florida, its agencies, employees, and agents arising out of or resulting from the Investigation as defined in Preamble Paragraph B. Contract Beneficiaries: This Agreement is intended to be for the benefit of the Parties only and by this instrument the Parties do not release any claims against any other person or entity, except to the extent provided in the immediately preceding Paragraph 14. Contribution from Medical Beneficiaries: WELLSCRIPTS waives and shall not seek payment for any of the health care billings covered by this Agreement from any health care beneficiaries or their parents, sponsors, legally responsible individuals, or third party payers based upon the claims defined as Covered Conduct. Litigation Costs: With exception of investigative costs and litigation costs, which may be specifically provided for in Paragraph 1, each party to this Agreement shall bear its own legal and other costs incurred in connection with this matter, including the preparation and performance of this Agreement. Unenforceable Clause: Neither Party shall challenge the legality or enforceability of this Agreement. If any clause, provision, or section of this Agreement shall, for any reason, be held illegal, invalid, or unenforceable, such illegality, invalidity, or unenforceability shall not affect any other clause, provision, or section of this Agreement, and this Agreement shall be construed and enforced as if such illegal, invalid, or unenforceable clause, section, or other provision had not been contained herein. Page 9 of 11 19. 20. 21. 22. 23. 24. 25. Arm’s Length Negotiations: The Parties executed this Agreement after arm’s length negotiations and it reflects the conclusion of the Parties that this Agreement is in the best interest of all the Parties. Each Party is satisfied with the Agreement’s language and construction, and therefore the interpretation of the terms of this Agreement shall not be construed against any of the Parties. Each Party represents that this Agreement is freely and voluntarily entered into without any degree of duress or compulsion whatsoever. Authority to Execute Agreement: The undersigned individuals signing this Agreement on behalf of WELLSCRIPTS represent and warrant that they are authorized to execute this Agreement. The undersigned MFCU signatories represent that they are signing this Agreement in their official capacities and that they are authorized to execute this Agreement. Effective Date: This Agreement is effective on the date of signature of the last signatory to the Agreement (hereinafter referred to as the “Effective Date”). Non-Punitive Effect: The Parties agree that this Settlement is not punitive in purpose or effect. IRS Characterization: Nothing in this Agreement constitutes an agreement or representation characterizing the Settlement Amount for the purposes of the Internal Revenue Code, Title 26 of the United States Code. Public Disclosure: All Parties consent to the MFCU’s disclosure of this Agreement, and information about this Agreement, to the public. Introductory Signals: The introductory paragraph signals are for subject identification only and do not affect the meaning or become part of the Agreement. Page 10 of 11 WELLSCRIPTS, LLC FOR FLORIDA'S OFFICE OF THE ATTORNEY GENERAL, DEPARTMENT OF LEGAL AFFAIRS PAM BONDI ATTORNEY GENERAL AY C. A oa * 3 ™ Carlos Muniz “ ie . J f- Deputy Attorney General/Chief of Staff Position: f , eal 4h vali Date: Date: Page 1! of Il (Page 1 of 48) POROA AGENCY FOR HESLIA CARE ADMINSTRATION: JEB BUSH, GOVERNOR CHRISTA CALAMAS, SECRETARY CERTIFIED MAIL. — 91 7108 2133 3932 8581 4299 September 7, 2006 Provider No: 026820800 License No: PH20057 Mr. Michael Verbitsky Wellscripts LLC 2024 Hollywood Boulevard Hollywood, Florida 33020 In Reply Refer to FINAL AUDIT REPORT CL No. 06-4308-000/P/AAE Dear Mr. Verbitsky: The Agency for Health Care Administration (the Agency), Bureau of Medicaid Program Integrity, has completed a review of claims for Medicaid reimbursement for dates of service during the period of December 1, 2004 through November 30, 2005. A preliminary audit report dated July 25, 2006 was sent to you indicating that we had determined you were overpaid $347,963.94. Based upon a review of all documentation submitted, we have determined that you were overpaid $347,963.94 for services that in whole or in part are not covered by Medicaid. A fine of $5,000.00 has been applied. The total amount due is $352,963.94. . Be advised of the following: (1) Pursuant to Section 409.913(23)(a), Florida Statutes (F.S.), the Agency is entitled to recover all investigative, legal, and expert witness costs. (2) In accordance with Sections 409.913(15), (16), and (17), F.S., and Rule 59G-9.070, Florida Administrative Code (F.A.C.), the Agency shall apply sanctions for violations of federal and state laws, including Medicaid policy. This letter shall serve as notice of the following sanction(s): ° A fine of $5,000.00 for violation of Rule Section 59G-9.070(7)(n), F.A.C. 2727 Mahan Drive « Mail Stop #4 Vallahassee, FL 32308 Visit AHCA online at www fdhe. state flus APPENDIX A (Page 2 of 48) Wellseripts LLC Page 2 of 4 This review and the determination of Overpayment were made in accordance with the provisions of Section 409.913, F.S. In determining the appropriateness of Medicaid payment pursuant to Medicaid policy, the Medicaid program utilizes procedure codes, descriptions, policies, limitations and requirements found in the Medicaid provider handbooks and Section 409.913, F.S, In applying for Medicaid reimbursement, providers are required to follow the guidelines set forth in the applicable tules and Medicaid fee schedules, as promulgated in the Medicaid policy handbooks, billing bulletins, and the Medicaid provider agreement. Medicaid cannot pay for services that do not meet these guidelines. Below is a discussion of the particular guidelines related to the review of your claims, and an explanation of why these claims do not meet Medicaid requirements. The audit work Papers are attached, listing the claims that are affected by this determination. REVIEW DETERMINATION(S) The audit included a comparison of your lawful documented product acquisitions with your paid Medicaid claims. Only product acquisitions from Florida licensed wholesalers were included in the review. The audit period for this review was from December 1, 2004 through November 30, 2005. The drug quantity paid for by Medicaid, in some instances, exceeded the quantity available to dispense to Medicaid recipients. This review identified an overpayment of $347,963.94. Enclosed for this revicw are the overpayment calculations which include the summary sheet(s), the paid claims data, and acquisition data. If you are currently involved in a bankruptcy, you should notify your attorney immediately and provide a copy of this letter for them. Please advise your attorney that we nced the following information immediately: (1) the date of filing of the bankruptcy petition; (2) the case number; (3) the court name and the division in which the petition was filed (e.g., Northern District of Florida, Tallahassee Division). If you are not in bankruptcy and you concur with our findings, remit by certified check in the amount of $352,963.94, which includes the Overpayment amount as well as any fines imposed. The check must be payable to the Florida Agency for Health Care Administration. Questions regarding procedures for submitting payment should be directed to Medicaid Accounts Receivable, (850) 488- 5869. ‘To ensure proper credit, be certain you legibly record on your check your Medicaid provider number and the C.I. number listed on the first page of this audit report. Please mail payment to: Agency for Health Care Administration Medicaid Accounts Receivable P.O. Box 13749 Tallahassee, Florida 32317-3749 If payment is not received, or arranged for, within 30 days of receipt of this letter, the Agency may withhold Medicaid payments in accordance with the provisions of Chapter 409.913(27), F.S. Furthermore, pursuant to Sections 409.913(25) and 409.913(15), F.S., failure to pay in full, or enter into and abide by the terms of any repayment schedule set forth by the Agency may result in termination from the Medicaid Program. Likewise, failure to comply with all sanctions applied or due dates may result in additional sanctions being imposed. (Page 3 of 48) Wellscripts LLC Page 3 of 4 You have the right to request a formal or informal hearing pursuant to Section 120.569, F.S. Ifa request for a formal hearing is made, the petition must be made in compliance with Section 28- 106.201, F.A.C. and mediation may be available. Ifa request for an informal hearing is made, the petition must be made in compliance with rule Section 28-106.301, F.A.C. Additionally, you are hereby informed that if'a request for a hearing is made, the petition must be received by the Agency within twenty-one (21) days of receipt of this letter. For more information regarding your hearing and mediation rights, please see the attached Notice of Administrative Hearing and Mediation Rights. Any questions you may have about this matter should be directed to: Arlenc Elliott, Senior Pharmacist, Agency for Health Care Administration, Medicaid Program Integrity, 2727 Mahan Drive, Mail Stop #6, Tallahassee, Florida 32308-5403, telephone (850) 921-1802, facsimile (850) 410-1972, Sincerely, @. katy D. Kenneth Yon AHCA Administrator aae Enclosure(s) cc: Christopher Parrella, J.D., CHC Health Law Offices of Anthony C. Vitale, P.A. 799 Brickell Plaza Suite 700 Miami, Florida 33131 Medicaid Accounts Receivable Arlene Elliott (Page 4 of 48) Wellsenpts 110 Page suf NOTICE OF ADMINISTRATIVE HEARING AND MEDIATION RIGHTS You have the tight to request an administrative hearing pursuant to Sections 120.569 and 120.57, Florida Statutes. If you disagree with the facts stated in the foregoing Final Audit Report (hereinafter FAR), you may request a formal administrative hearing pursuant to Section 120.57{L), Florida Statutes. If you do not dispute the facts stated in the FAR, but believe there are additional .feasons to grant the relief you seek, you may request an informal administrative hearing pursuant to Section 120.57(2), Florida Statutes. Additionally, pursuant to Section 120.573, Florida Statutes, mediation may be available if you have chosen a formal administrative hearing, as discussed more fully below. The wnitten request for an administrative hearing must conform to the requirements of either Rule 28-106.201(2) or Rule 28-106.301(2), Florida Administrative Code, and must be received by the Assistant Bureau Chief by 5:00 P.M. no later than 21 days after you received the FAR. The address for filing the written request for an administrative hearing is: Assistant Bureau Chief Medicaid Program Integrity Agency for Health Care Administration 2727 Mahan Drive, Mail Stop #6 Tallahassee, Florida 32308 The request must be legible, on 8 % by 11-inch white paper, and contain: 1. Your name, address, telephone number, any Agency identifying number on the FAR, if known, and name, address, and telephone number of your representative, if any; 2. An explanation of how your substantial intcrests will be affected by the action described in the FAR; 3. A statement of when and how you received the F. AR; 4. Fora request for formal hearing, a statement of all disputed issues of material fact; 5. Fora request for formal hearing, a concise statement of the ultimate facts alleged, as well as the rules and statutes which entitle you to Telief; : 6. Fora request for formal hearing, whether you request mediation, if it is available; 7. For a request for informal hearing, what bases support an adjustment to the amount owed to the Agency; and 8. A demand for relief. A formal hearing will be held if there are disputed issues of material fact. Additionally, mediation may be available in conjunction with a formal hearing. Mediation is a way to use a neutral third party to assist the parties in a legal or administrative proceeding to reach a settlement of their case. If you and the Agency agree to mediation, it does not mean that you give up the right to a hearing. Rather, you and the Agency will try to settle your case first with mediation. Tf you request mediation, and the Agency agrees to it, you will be contacted by the Agency to set up a time for the mediation and to enter into a mediation agreement. If a mediation agreement is not reached within 10 days following the request for mediation, the matter -will proceed without mediation. The mediation must be concluded within 60 days of having entered into the agreement, unless you and the Agency agree to a different time period. The mediation agreement between you and the Agency will include provisions for sclecting the mediator, the allocation of costs and fees associated with the mediation, and the confidentiality of discussions and documents involved in the mediation. Mediators charge hourly fees that must be shared equally by you and the Agency. 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Asay av 206082 SLOL02 L8P969 Lesg69 S86189 060E29 06999 ZLEGSS poRsssg bobver9o 6249829 6921429 682b29 89LLZ9 tZ-209 SCELIG cOSOby 289606 b6LS6r6 40L02E SOLOLE bZZ0vE 6PL6ZL 66LbcL 88956 BSbcSr6 tSL6Eb6 8210666 LOvr2e6 vLS6P86 bye 2956 CLBbbS6 SOerhSE E€660ES6 SOEB0ES 90E60E6 6SZE626 4SZE6CE LSLESZE O8Lzezé b8L2ec6 S6LELLE 89rBE06 8E2SZ06 er9SZ06 9r8le6e L6Lp968 6er2cse 2065228 So0e/z1/8 SOOZ/Er8 sooz/ee soocizig SOOZ/L/8 SOOZ/62/L SOOZ/B2/2 soogLese SOOC/L2/L so0z/sere SOOC/S2L S00z/e2ie SO0e¢zzz SOOz/eZeit SOOT EL SDOZ/L EL SOOZ/0E/9 sooze7s SO00Z/Z7/9 Sodz/ee/9 so0z/ez9 s00z/0z/9 SO0Z/L/9 soozse/s Sooz/eers SOOzETz/s SOOC/ELIS SOOZ/OL/S SOOZ Ziv SO0d/Sc/p sodese/e SOOZ/IEZ/E SOOC/ECIE SOOeZz/E gooe/s7e so0d/Se/e S00c/re/e SOO0e¢/P2/e SOC Zz SO0z/ez/z SOOZLLIZ SO0z/v/z SOO0c/22/L So0e/se/t soozeert SOO?/Le/L SOOC/E L/L SOOc/r/L poozecet leurpseg IEUIPIED leulped leulpses jeulprea jeuipses, jeulpleg reulpses jeulpieg IEUIPIED leuipseg leuIpyeg leUIPIeED IEUIPIED leulpses IEUIPJED feulpies on8g oo}1eg leulpse jeuipses jeulpseg reuipies jeulpieg [BUIPIED oo|jag ooi9g reulpies jeulpseg leurpreg feUIpIED reuipreg, jeulpses jeuped FEUIPIED eulpseg jeurpeg jeulpseg eulpseo, jeuipeg eulpled UIPIED eulpleg feuipes, feUlpueD BUIPIeED reUIpIED {EUIDJED leUlpleD leUIpleg OD807289Z0 # JapiAcig O11 SIduOS}aAA fan im tee (Page 7 of 48) Weliscnpts LLC INVOICE REVIEW Provider # 026820800 . Shipp Cardinal 8/15/2005 791058 1 Cardinal 8/25/2005 881593 ABILIFY 15MG TABS 1 30 30 Cardinal 8/25/2005 881597 ABILIFY 1S5MG TABS 2 30 60 Cardinal 8/29/2005 902946 ABILIFY 15MG TABS 1 30 30 Cardinal 8/29/2005 902948 ABILIFY 1SMG TABS 2 30 60 Cardinal 8/29/2005 902956 ABILIFY 15MG TABS 1 30 30 Cardinal 8/30/2005 912207 ABILIFY 15MG TABS 3 30 90 Cardinal 9/12/2005 999712 ABILIFY 15MG TABS 4 30 30 Cardinal 9/12/2005 $99717 ABILIFY 15MG TABS 4 30 30 Cardinal 9/14/2005 1024276 ABILIFY 15MG TABS 1 30 30 Cardinal 9/15/2005 1034422 ABILIFY 15MG TABS 1 30 30 Cardinal 9/26/2005 1108713 ABILIFY 1SMG TABS 1 30 30 Cardinal 9/28/2005 1108714 ABILIFY 15MG TABS 1 30 30 Cardinal 9/27/2005 1124704 ABILIFY 15MG TABS 2 30 60 Cardinal 9/27/2005 1124731 ABILIFY 15MG TABS 1 30 30 Cardinat 9/29/2005 1146258 ABILIFY 15MG TABS 1 30 30 Cardina 9/29/2005 1146262 ABILIFY 15MG TABS 3 30 90 Cardinal 10/5/2005 1192557 ABILIFY 15MG TABS 1 30 30 Cardina 10/10/2005 1217189 ABILIFY 15MG TABS 1 30 30 Cardina 10/14/2005 1257074 ABILIFY 15MG TABS 1 30 30 Cardinal 10/17/2005 1272799 ABILIFY 15MG TABS 1 30 30 Cardinal 10/19/2005 1298947 ABILIFY 15MG TABS 1 30. 30 Cardinal 10/27/2005 1353780 ABILIFY 15MG TABS 3 30 90 Cardinal 10/27/2005 1353777 ABILIFY 15MG TABS 4 30 30 Cardina 10/31/2005 1370709 ABILIFY 15MG TABS 2 30 60 Cardinal 10/31/2005 1370806 ABILIFY 15MG TABS 2 30 60 Cardinal 14/2/2005 1398925 ABILIFY 15MG TABS 1 30 30 Cardinal 11/11/2005 1480110 ABILIFY 15MG TABS 1 30 30 Cardinal 11/18/2005 1538685 ABILIFY 15MG TABS 1 30 30 Cardinal 11/22/2005 1556873 ABILIFY 15MG TABS 1 30 30 Cardinal 11/22/2005 1556878 ABILIFY 15SMG TABS 2 30 60 Cardinal 11/23/2005 1573553 ABILIFY 15MG TABS 3 30 90 Cardinal 11/25/2005 1584639 ABILIFY 15MG TABS 1 30 30 Cardinal 11/28/2005 1596696 ABILIFY 15MG TABS 3 30 90 116 3480 Cardinal 12/1/2004 8554332 ABILIFY 20MG TABS 2 30 60 Cardinal 1/19/2005 8964791 ABILIFY 20MG TABS 2 30 60 Cardinal 4/5/2005 9660446 ABILIFY 20MG TABS 1 30 30 Cardinal 4/8/2005 9701773 ABILIFY 20MG TABS 1 30 30 Cardinal 4/15/2005 9769768 ABILIFY 20MG TABS 1 30 30 Cardinat 4/22/2005 9834433 ABILIFY 20MG TABS 4 30 30 Cardinal 4/28/2005 9886981 ABILIFY 20MG TABS 1 30 30 Bellco §/3/2005 9424853 ABILIFY 20MG TABS 2 30 60 Belico §/13/2005 9439751 ABILIFY 20MG TABS 2 30 60 Cardinal 6/6/2005 214635 ABILIFY 20MG TABS 1 30 30 Cardinal 7/6I2005 = 480967 ABILIFY 20MG TABS 4 30 30 Cardinal 7/20/2005 596573 ABILIFY 20MG TABS 1 30 30 Cardinal 7/27/2005 = 655812 ABILIFY ZOMG TABS 1 30 30 Cardinal 7/28/2005 666494 ABILIFY 20MG TABS 1 30 30 (Page 8 of 48) Wellseripts LLC INVOICE REVIEW Prowider # 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026820800 ‘ oem nae
The Issue The central issue in this case is whether the provider, Medilab, was overpaid for medicaid claims as alleged in the letter dated November 3, 1993.
Findings Of Fact The Agency is the state agency responsible for administering the Florida Medicaid program. At all times material to this case, Medilab was a medicaid provider. Medilab enrolled as a physician group provider on or about October 2, 1991. Medilab was not enrolled with the Florida Medicaid program as a diagnostic lab. At all times material to this case, Medilab was owned and operated by Roberto Rodriguez and Jorge Nunez. Mr. Rodriguez handled the administrative duties for Medilab while Mr. Nunez operated the diagnostic portion of the business. Medilab operated several machines for diagnostic evaluations as ordered by a physician. Such machines produced documentation which was then evaluated by another physician. Dr. Carmouze did not perform the service nor interpret the diagnostic results. When Medilab applied for a provider number to enroll in the Medicaid program it represented that services were to be provided by Dr. Arnoldo Carmouze. It was further represented that Dr. Carmouze would treat or supervise treatment of patients on behalf of the Medilab "group." On or about January 11, 1992, Medilab received its group provider number along with a copy of the Medicaid Physician Provider Handbook. Medilab was notified that it could begin billing for services beginning October 2, 1991. Subsequently, the Agency performed an audit of Medilab for the period October 2, 1991 through August 31, 1992. Li-Hsiang Wu, a computer systems project analyst employed by the Agency, generated a random sample of Medicaid recipients by using a computer program to calculate the total number of Medicaid recipients for which claims were submitted during the audit period. Then Medilab's provider number and the dates of the audit were used to generate the total number of Medicaid recipients for whom claims were submitted by Medilab for the audit period. Once the total number of recipients was identified, Ms. Wu generated a list of forty-three recipient numbers which were selected by the computer from the total number claimed by Medilab for the period searched. Mr. Allen then requested and obtained from Medilab the medical records for the same forty-three randomly selected Medicaid recipients. The medical records were first reviewed by Phyllis Stiver, the Agency's registered nurse consultant. Once Ms. Stiver completed her initial review, Mr. Allen requested additional records from Medilab. Specifically, documentation for the office visit and records that established the necessity for the tests performed by Medilab were requested for each of the forty-three recipients. Medilab subsequently submitted additional records to the Agency which were also reviewed by Ms. Stiver. Ms. Stiver determined that based upon her review of the forty-three records, Medilab had violated Medicaid rules and policy as follows: Medilab failed to have all of the medical records signed by a physician and dated; and Medilab failed to document in the medical records to show that certain diagnostic tests were performed. After Ms. Stiver completed her review of the records, Dr. Sullenberger reviewed each of Medilab's medical records for the forty-three patients. Dr. Sullenberger determined, and it is found, that the majority of the tests performed by Medilab were not medically necessary based upon the symptoms documented for each patient, the prior patient histories established by the records, and the absence of other, less expensive testing that would normally be utilized to determine a medical condition. Virtually all of the patient records reviewed recited the same medical complaints: chest pain, shortness of breath, palpitation, numbness or tingling in extremities, and dizziness. Only five of the forty-three patients were over 49 years of age. The ages of the majority of the forty-three were under 50. That age group is rarely afflicted by the types of medical conditions which the Medilab equipment was used to detect. The symptoms and medical histories recited in the medical records did not justify the tests performed by Medilab for the following patients (recipients identified in this record as numbers 1 through 43): 1, 2, 17, 18, 21, 22, 24, 25, 32, 34, 35, 37, 38, and 41. With the exception of the electrocardiogram, the symptoms and medical histories recited in the medical records did not justify the tests performed by Medilab for the following patients (recipients identified in this record as numbers 1 through 43): 3, 4, 5, 6, 7, 9, 11, 12, 13, 15, 16, 19, 20, 23, 26, 27, 29, 30, 31, 33, 36, 39, 40, 42, and 43. With regard to recipient 8, except for the electrocardiogram and the abdominal ultrasound, the tests performed by Medilab were medically unnecessary. With regard to recipient 10, except for the electrocardiogram and the Doppler echocardiogram, the tests performed by Medilab were medically unnecessary. With regard to recipient 14, except for the electrocardiogram and the echocardiogram, the tests performed by Medilab were medically unnecessary. With regard to recipient 28, except for the mammogram, the tests performed by Medilab were medically unnecessary. None of the services or testing performed by Medilab were supervised by a physician. Two physicians, Dr. Pozo and Dr. Pereira, radiologists, read the diagnostic results but were not on site to perform or supervise the tests on a daily basis. Dr. Pozo did not supervise the services that were provided at Medilab. Dr. Pereira, who is deceased and whose testimony was not available, did not supervise the services that were provided at Medilab. According to Mr. Nunez, Dr. Pereira had someone from his office courier the tests results and his interpretations to and from the Medilab facility. Dr. Pereira may have visited the facility on occasion but was not there during its full hours of operation. Dr. Carmouze, the treating physician and representative for Medilab's physician group, did not supervise the services at Medilab. Dr. Carmouze treated over 95 percent of the total patients referred to Medilab yet Dr. Carmouze never billed the Medicaid program for the patients' office visits. For the audit period, of the 493 different patients Medilab billed Medicaid for, Dr. Carmouze is the only treating physician identified by the records. The Medicaid Physician's Handbook, supplied to Medilab at the time of its enrollment, specified that to be reimbursable the services performed by a physician group provider had to be medically necessary and supervised by a physician. The Medicaid Provider Agreement required Medilab to keep complete and accurate medical and fiscal records that fully justify and disclose the extent of the services rendered for five years. All tests performed by Medilab were documented with a physician's order for same. Medilab submitted for review all medical and fiscal records it maintained in its attempt to fully justify and disclose the extent of the services it rendered.
Recommendation Based on the foregoing, it is, hereby, RECOMMENDED: That the Agency for Health Care Administration, Medicaid Program Integrity Office, issue a final order charging Medilab for the full amounts paid for the audit period as the services rendered were not supervised by a physician and were, therefore, not "physician services." Additionally, the Agency should impose an administrative fine in an amount not to exceed $5,000.00. DONE AND RECOMMENDED this 1st day of March, 1995, in Tallahassee, Leon County, Florida. JOYOUS D. PARRISH Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 1st day of March 1995. APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-0096 Rulings on the proposed findings of fact submitted by the Petitioner: Paragraphs 1, 2, 4, 6, and 12 are accepted. Paragraph 3 is rejected as not supported by the weight of credible evidence. Paragraph 5 is rejected as irrelevant. Paragraph 7 is accepted as to the general statement but is rejected as to the amount claimed. Paragraph 8 is rejected as a mischaracterization of testimony; it is accepted Dr. Sullenberger, on further reflection and in an effort to be consistent, gave Medilab the benefit of doubt and modified disallowed items. Paragraph 9 is rejected as irrelevant. Paragraph 10 is rejected as irrelevant. Paragraph 11 is rejected as contrary to weight of credible evidence. Paragraph 13 is rejected as irrelevant or argument. Paragraph 14 is rejected as irrelevant. That Dr. Carmouze never charged for the alleged office visits that generated the referral for tests was the relevant fact. Paragraph 15 is accurate but is irrelevant in light of the stipulation. Rulings on the proposed findings of fact submitted by the Respondent: 1. Paragraphs 1 through 36, 39, 41, 43, 46, 48, 49, 50, 52, and 53 are accepted. Paragraphs 37, 38, 40, 42, and 47 are rejected as argument. Paragraph 44 is rejected as hearsay not supported by direct evidence. Paragraph 45 is rejected as not supported by the weight of credible evidence. With regard to paragraph 51, the first sentence is accepted; the remainder rejected as not supported by the weight of credible evidence. COPIES FURNISHED: Heidi E. Garwood Agency for Health Care Administration 1317 Winewood Boulevard Building B, Room 271 Tallahassee, Florida 32399-0700 Monte K. Rassner Rassner, Rassner, Kramer & Gold, P.A. 7000 Southwest 62nd Avenue, Suite PH-B South Miami, Florida 33143 Sam Power, Agency Clerk Agency for Health Care Administration The Atrium, Suite 301 325 John Knox Road Tallahassee, Florida 32303 Tom Wallace, Assistant Director Agency for Health Care Administration The Atrium, Suite 301 325 John Knox Road Tallahassee, Florida 32303
The Issue The issue in this case is whether proposed rules 65G-4.0210 through 65G-4.027 (the “Proposed Rules”) are an invalid exercise of delegated legislative authority as defined in section 120.52(8), Florida Statutes. (Unless specifically stated otherwise herein, all references to Florida Statutes shall be to the 2012 codification.) Specifically, Petitioners assert that the Proposed Rules (1) enlarge, modify, and contravene the specific provisions of the law they purport to implement; (2) contain vague and inadequate standards that vest unbridled discretion in the Agency for Persons with Disabilities (the “Agency” or “APD”); (3) are arbitrary and capricious; and (4) exceed the grant of rulemaking authority in section 393.0662(9), Florida Statutes. Petitioners further argue that, (5) APD failed to follow applicable rulemaking procedures required by sections 120.54(3) and 120.541, Florida Statutes, because APD failed to provide a Statement of Estimated Regulatory Costs (“SERC”) as a part of the rulemaking process.
Findings Of Fact Each of the Petitioners is a recipient of services under the DD Waiver Program. For example, Petitioner Z.L. is a 26- year-old male who was born with Cri-du-Chat syndrome, a fifth chromosome abnormality. As a result, Z.L. is low-functioning, with a non-measurable IQ level (but likely well below the level designating mental retardation). Z.L. speaks only a few words and communicates with some sign language. He is ambulatory, but he is totally dependent on others for all activities of daily living. Z.L. also has some extreme behavioral issues, including self-abuse and physical abuse of others. He lives in a private residence with two other developmentally disabled men. The home where they reside belongs to the family of K.L. (Z.L.’s father and legal guardian). K.L. rents the home for Z.L. and the other two men at less than its actual market value. (The home is a 1,500 square foot home located on 15 acres. K.L. pays about $600 per month rent; the home could rent for two or three times that much.) Z.L. receives the following services under the DD Waiver Program: 24-hour assistance with activities of daily living; behavioral analysis through a certified behavior analyst; and personal care assistance. The cost of his care plan for the previous year was $61,824.22 (i.e., that was the amount paid by the DD Waiver Program). Z.L.’s father and mother are unable to care for Z.L. in their home. The father is CEO of a bank and is involved in other businesses as well. The mother recently suffered closed head injuries as a result of a bicycle accident. She must be cautious about any further head injuries and fears that Z.L.’s aggression could result in physical harm to her. As a result of the implementation of the iBudget process, APD is proposing to reduce Z.L.’s care plan by the sum of $8,175.98. Under the iBudget process, Z.L. has the right to challenge the reduction of his care plan amount in a Fair Hearing before a Department of Children and Families Hearing Officer, which he has done. K.L. has expended about $6,000 in legal fees to contest the reduction of Z.L.’s care plan amount under the new iBudget system. He expects that if the matter goes to appeal, he will expend as much as $70,000 more in legal fees. K.L. has also hired a lawyer for one of Z.L.’s roommates.1/ APD is the state agency responsible for distributing funds from the DD Waiver Program. Prior to implementation of the iBudget process, APD used a four-tier system to provide the level of funds each client would receive.2/ The tier system was more rigid in its application than the iBudget system. Under the tier system, there were strict funding policies in place. For example, if dollars were allocated toward a specific service, e.g., transportation, those dollars could not be used for any other service, such as companion care or personal care. As will be discussed more fully below, the funds provided in the iBudget process are more flexible regarding services they can purchase. The DD Waiver funds administered by the Agency are the funds of last resort. If a service received by a client can be paid for by another agency or source of payment, those must be utilized before the Agency can allocate funds for the service. Development of the iBudget System The 2010 Florida Legislature mandated creation of an iBudget process for distributing funds from the DD Waiver Program. Section 393.0662(1) states in pertinent part: The agency shall establish an individual budget, referred to as an iBudget, for each individual served by the home and community- based services Medicaid waiver program. The funds appropriated to the agency shall be allocated through the iBudget system to eligible, Medicaid-enrolled clients . . . . In developing each client’s iBudget, the agency shall use an allocation algorithm and methodology. The algorithm shall use variables that have been determined by the agency to have a statistically validated relationship to the client’s level of need for services provided through the home and community-based services Medicaid waiver program . . . . The allocation methodology shall provide the algorithm that determines the amount of funds allocated to a client’s iBudget. The agency may approve an increase in the amount of funds allocated, as determined by the algorithm, based on the client having one or more of the following needs that cannot be accommodated within the funding as determined by the algorithm and having no other resources, supports, or services available to meet the need: An extraordinary need that would place the health and safety of the client . . . in immediate, serious jeopardy . . . . A significant need for one-time or temporary support or services . . . . A significant increase in the need for services after the beginning of the service plan year . . . . The agency shall reserve portions of the appropriation for the home and community- based services Medicaid waiver program for adjustments required pursuant to this paragraph . . . . A client’s iBudget shall be the total of the amount determined by the algorithm and any additional funding provided pursuant to paragraph (b). A client’s annual expenditures for home and community-based services Medicaid waiver services may not exceed the limits of his or her iBudget. The total of all clients’ projected annual iBudget expenditures may not exceed the agency appropriation for waiver services. In response to the statutory mandate, the Agency sought input from “stakeholders,” i.e., individuals and families receiving services, family care counsel groups, various provider groups, and organizations such as the Association of Retarded Citizens and the like. APD also looked at how other states had addressed the issue of fund distribution to developmentally disabled individuals. The Agency hired consultants to help make the process as equitable and fair as possible within the limits of its finite budget. One of the Agency’s hired consultants was Dr. Xufeng Niu, chair of the statistics department at Florida State University. Dr. Niu is a recognized expert in the field of statistics and had used his expertise in many areas, including transportation issues such as railroad crossing safety and environmental issues for the Department of Environmental Protection. Dr. Niu has been an academician and consultant since obtaining his Ph.D. in statistics from the University of Chicago in 1991. Dr. Niu’s testimony was extremely credible. APD hired Dr. Niu to develop an algorithm which would be the key feature to any individual budget calculation. APD’s goal in developing the algorithm was to create a formula fitting data patterns of past expenditures, then to mathematically replicate decisions that were made to establish a client’s prior budget amount. Dr. Niu, by way of statistical modeling techniques, developed certain factors which could be utilized by the Agency in determining which clients would receive funds for specific services. Using a catalogue of predictors or variables derived from information provided to him by the Agency, Dr. Niu built a tool to predict what each client’s cost for needed services would be. A Bell Curve was used to keep the application of the variables more symmetrical. In order to effectuate this desire, Dr. Niu utilized a form of “transformation” referred to as the Box-Cox Transformation Family. The Box-Cox Method involved raising data to a different mathematical power as a means of analyzing and applying the data. Dr. Jim McClave, who operates a statistical consulting firm, is an expert statistician and econometrician. His work involves regular stints as an expert in legal proceedings such as this rule challenge matter. His testimony was credible, but less persuasive than that of Dr. Niu.3/ Dr. McClave would have used a log transformation method rather than the Box-Cox method relied upon by Dr. Niu. However, while not discounting the log transformation method, Dr. Niu competently testified that the Box-Cox worked best in this particular case. After the transformation process, it was necessary to narrow down the number of variables to be used. Dr. Niu ultimately decided to use nine specific variables, including: the client’s living setting; whether the client is an adult; the client’s score on the six elements set forth in the Questionnaire for Situational Information (“QSI”) which was provided to all potential recipients of services; the client’s score on the 11 elements in the functional summary section of the QSI; and the client’s score on each of three specific elements in the QSI related to transfers (ability to transfer or change position), hygiene, and capacity for self-protection. Not all variables are necessarily useful and having too many variables causes over- fitting, i.e., trying to fit every situation into a perfect model, which simply is not possible. In fact, it is better to have fewer variables as long as sufficient data can be captured. A statistician must reach a balance on the number of variables in order to find the best model for each project. Dr. Niu’s affirmation of the variables he used is credible. Dr. Niu utilized the Generalized Information Criterion (“GIC”), a method of finding the best set of predictors when creating an algorithm. GIC is a criterion that tries to balance the model by carefully adding more variables without overpopulating the model with too many variables. GIC was used by Dr. Niu in conjunction with the concept of R-squared. That concept is a statistical measure of how well an algorithm fits the data in order to test how well the model predicts. The algorithm developed for use in the Proposed Rules has an R- squared value of .6757, meaning that it accounts for about 68 percent of the variation in the population of APD clients’ DD Waiver expenditures. By contrast to the GIC and R-squared approach, there is in the field of statistics a tool referred to as Residual Standard Error. This tool helps determine whether a model is predicting within two standard deviations and thus has a measure of certainty. The algorithm proposed by APD did not utilize the Residual Standard Error tool, relying instead on the combination of GIC and R-squared. Based upon Dr. Niu’s testimony, APD’s reliance on those tools is reasonable. Dr. Niu developed a number of models for possible use in the iBudget process, settling at last on Model 7b. The model was then applied to the pool of clients who would be affected by the new iBudget system. The client pool contained a large number of different situations and scenarios, as each client and client family is unique despite some similar developmental issues. As a result of these differences, there were cases in which a particular client -- because of his or her needs, or those of his or her family -- did not fit the model. These cases were called “outliers” and had to be treated differently by the Agency. Of the total group of some 26,000 clients, 9.37 percent, or about 2,400 clients, were deemed outliers. Dr. McClave criticized this percentage of outliers, but Dr. Niu's substantiation of the percentage is credible. Dr. Niu utilized actual expenditures by APD for DD Waiver Program clients during the 2007-2008 fiscal year as an indicator of what APD had faced in the past. Those data were recent enough in time to be linked to current assessment data for the clients and to be assigned scores from the QSI. APD also found that the 2007-2008 data more accurately reflected service needs compared to other recent years because the data pre-dated the implementation of the more restrictive Tier system. Dr. Niu did not use clients with less than one year of claims because they may not project the client’s actual annual expenditures. Dental services, environmental services, and durable medical equipment purchases were excluded because they are generally a once-a-year purchase. Four of Florida's 67 counties were excluded from the calculations because they had a much higher cost of living than the rest of the state. Mismatches and clerical errors in clients’ records were also taken into consideration. Age was used as a predictor, but after trial and error Dr. Niu decided upon a single division, i.e., persons under 21 years of age versus persons 21 or older. The rationale was that people under 21 receive services from other sources, like the public school system, for example. Persons over 21 begin to require more services as they age. Dr. Niu considered more factors than just the mathematical statistical accuracy. His extensive work resulted in the best model out of many possibilities. Transportation needs and costs were considered during the stakeholder meetings as a factor to be considered when discussing possible variables. Dr. Niu attempted to use a transportation index in his models, but that resulted in a negative coefficient which is less valid statistically. Applying the current year’s transportation costs did not work. It was also impossible to apply a portion of a year’s transportation costs as an indicator of the entire year’s transportation costs. And, because transportation costs constitute only about 1.5 percent of overall expenses, it was reasonably determined that such costs could be handled by way of an extra needs review. Upon completion of the iBudget system, it was implemented and introduced to all eligible DD Waiver clients. The program was introduced in “waves,” i.e., not all DD waiver clients being served by APD received their iBudgets at one time. Rather, the new system was phased in over time. How the iBudget System Is Employed APD sends an information packet to each client, i.e., each person seeking services to be paid for under the DD Waiver Program. This information packet, called a Welcome Guide, is meant to help the client understand the new system. The Welcome Guide provides a large amount of information, plus education and training possibilities as well. It is understandably difficult to absorb all of the information contained in the packet, but APD opted for completeness rather than over-simplifying the information. Z.L.’s father, who is a licensed attorney and CEO of a bank, expressed difficulty understanding the information contained in the Welcome Guide. However, he testified that he has "some kind of memory block" about DD Waiver services. It is understandable that this would be a difficult thing for a parent to review. The first step of the process for requesting funds for services under the iBudget system is to have the client complete a QSI form. After the QSI assessment is done, the second step of the process is for the Agency to run its algorithm using the previously discussed variables such as age, living arrangement, behavioral status, functional status, and the responses to various personal questions concerning the client. Running the algorithm then creates a dollar value for the services deemed appropriate for the client. The cost of the services is then related back to the appropriation of funds received by APD from the Legislature for providing all needed services. Each client’s sum for needed services is then given a pro rata reduction (or, theoretically, an increase) based on the total funds available to APD. There are then adjustments which can be made to the algorithm amount. For example, if the algorithm amount for a client was greater than the amount set forth in the client’s existing care plan, that client’s “algorithm amount” was reduced to the existing care plan amount, at least temporarily pending further possible actions under the iBudget process. There are specific services identified in the Proposed Rule (at 65G-4.0212(b)(2)), which are indicative of certain health and safety needs. If a client needs any of those services and the cost of those services is greater than the algorithm amount, the greater sum will be substituted. If the algorithm amount was less than the client’s care plan amount but within $1,000 of the existing care plan amount, then the care plan amount was used as the “algorithm amount.” This $1,000 buffer will necessarily mean that a client whose care plan amount is $999 more than the algorithm amount may be treated differently from a person whose care plan amount is $1,001 more than the algorithm amount. Still, the decision to employ a $1,000 threshold is generally reasonable as APD attempts to maintain a sufficient care plan allocation despite the change in systems. APD reasonably believes it would be more time-consuming and costly to deal with changes of $1,000 or less than to simply accept the prior care plan amount (which was based upon the client's needs). If the algorithm amount is less than the amount in the client’s existing care plan, then APD determines whether the reduction is greater than 50 percent of the existing care plan amount. If so, the algorithm amount is raised to an amount equal to at least 50 percent of the existing care plan amount. After application of the above-reference factors and -- if warranted -- adjustments are made, the client is provided an amount which is referred to as the “Target Allocation.” The fourth step in the process is for APD to provide the Target Allocation amount to the client and WSC. Step five of the process is a review to determine whether, notwithstanding the algorithm amount, a client has extra needs that warrant an increase in their ultimate allocation of funds for services. This is called the Extraordinary Needs Review. The first phase of this step is an allocation implementation meeting (AIM), wherein the client is advised about the changes --if any -- to his/her care plan. The client and his or her waiver support coordinator (WSC) are given information about how the reductions may be handled, e.g., that under the iBudget it might be possible to utilize funds to pay for one service even if they are allocated for another service. Or, there may be ways under the iBudget system to merge two or more services into one. One example of that is that in-home personal service caregivers may be allowed to perform other tasks, e.g., they may be able to provide services outside the home setting. After almost a full year of implementing the iBudget system, this portability of funds from one service to another has proven to be one of the most appreciated functions of the new process by waiver support coordinators. If the client and WSC agree that the service needs can be met by the Target Allocation, that amount becomes the client’s iBudget Allocation amount. If the client and WSC do not think the Target Allocation amount is sufficient to meet the service needs, the AIM form is completed and sent to APD for further review. If the health and safety of the client, client’s caregiver, or the public is placed in immediate jeopardy without an increase in the allocation, then an increase will be approved. APD then gives the client notice as to its decision and the final iBudget Allocation is provided. This constitutes step six of the process. Subsequent to setting and providing notice of the final iBudget Allocation, a client may seek supplemental funding for significant one-time or temporary needs. If a significant increase in need for services arises after the beginning of a plan year, a process exists for further consideration of the client’s needs. For new clients, i.e., those who do not have an existing care plan when the iBudget is applied to them, the process is slightly different. First there is an eligibility determination (which has already occurred for existing clients). The client then responds to the QSI. The algorithm is calculated to form the target allocation for the new client. An extra needs review is then performed to make sure that all health and safety needs are being met. It is possible that a new client with exactly the same condition, circumstances, and needs as an existing client (albeit an extremely unlikely occurrence), could receive a larger amount under the iBudget than the existing client. If both clients were assigned exactly the same score under the algorithm, but the existing client’s allocation amount were larger than the care plan amount under the Tier system, then the existing client’s allocation would be reduced. There would not be a concomitant reduction of the new client’s allocation. Although Petitioners pointed out this alleged flaw, no remedy was suggested that would make it possible for APD to make the treatment of two similarly situated clients more equal. The iBudget system is not flawless, but it is an admirable effort toward equality of application to all “clients.” The Agency did not set aside or reserve any portion of their allocation from the Legislature as a Reserve Fund, per se. Rather, APD uses the reserve fund concept as a management tool to be used when making adjustments to an individual client’s final allocation of funds. Thus, during the AIM process or the Supplemental Cost Funding phase, APD might raise a client’s allocation based on funds it has “reserved” under the algorithm calculation. Statement of Estimated Regulatory Costs APD published the initial proposed rule on August 3, 2012. The publication included a statement that the Agency had determined there would not be an adverse impact on small business nor would it increase regulatory costs in excess of $200,000 within one year. Petitioners’ contention that clients may have difficulty understanding the welcome packet information and may challenge iBudget Allocations by way of fair hearings does not establish the necessity for SERC.
The Issue Did the Department of Children and Family Services (Department) improperly deny the in-home subsidy of $400.00 per month to Petitioner?
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: The Department is the agency of the State of Florida charged with the responsibility of administering the Medicaid Developmental Disabilities Home and Community-Based Services Waiver Program (Medicaid Waiver Program), the Family Care Program, and the provisions of in-home subsidies. Petitioner is a 30-year-old severely developmentally disabled woman who suffers from cerebral palsy and is totally blind. Petitioner is confined to a wheelchair, cannot care for herself, and is totally dependent on others for her care 24 hours a day. Petitioner lives with her mother and legal guardian, Jo Anne Weaver, and her stepfather, in the Weaver's home, which was purchased by the Weavers in March 2001, with a mortgage, after renting the home for three years. The Weavers have made modifications to the home to accommodate Petitioner's needs, including a ceiling lift that takes Petitioner from her bed, through the hall, and into her bathroom. Mr. Weaver is school teacher who works two nights a week in addition to daytime employment. Jo Anne Weaver sells advertising for the Jewish Press and earns $170.00 per week, plus $50.00 per week for expenses. In addition to the in-home subsidy, Petitioner receives assistance through the Department under the Medicaid Waiver Program, which allocates funds to provide Petitioner with in- home caregivers and other in-home services, such as companion services, personal care assistance, respite care, and consumable medical supplies. The funds under the Medicaid Waiver Program are paid directly to the caregivers and service providers and not to Petitioner or her guardian. The Medicaid Waiver Program, through a cost plan established and approved each year for Petitioner, allocates funds to provide a maximum of ten hours per day of caregiver services to Petitioner. Petitioner's family, primarily her mother and stepfather, provide uncompensated care to Petitioner the remaining 14 hours of each day. Petitioner's mother gets up several times each night to diaper Petitioner and to reposition her in the bed. Due to a number of factors, Medicaid Waiver Program services that have been approved under a support plan may not ultimately be received by the disabled person. Petitioner has never used all the funding allocated under her support plan. Although the Medicaid Waiver Program authorizes the provisions of funds for caregivers for 10 hours each day, Petitioner's mother has been unable to arrange consistently for caregivers to come to the home for the full 70 hours each week because it is very difficult to find, secure, and keep caregivers who will provide services under the terms of the Medicaid Waiver Program. In addition to the services authorized under the Medicaid Waiver Program, Petitioner has been, since 1995, receiving a monthly in-home subsidy of $400.00 per month in accordance with Section 393.0695, Florida Statutes. The in-home subsidy is paid from general revenue funds and is not part of Medicaid program, and is the only payment that Petitioner or the Weavers receive directly from the Department. However, Petitioner receives $74.00 per month Supplemental Security Income and $478.00 per month court-ordered support payment from her father. Additionally, Petitioner's father pays for her Blue Cross/Blue Shield health insurance coverage. The Weavers pay for Petitioner's out-of-pocket medical and dental expenses. Petitioner's Proposed Developmental Services Cost Plan (Support Plan) with a development date of December 15, 2000, shows a proposed cost of $87,518.96. This amount included a $400.00 per month ($4,800.00 per year) in-home subsidy for basic living necessities as set forth in Subsection 393.0695(2), Florida Statutes. At the time the proposed support plan was submitted, the average cost for institutional placement was $71,424.44. On August 27, 1999, the Department issued the Developmental Services Home and Community-Based Services, WAIVER CLARIFICATION P.D.#99-05 REV02, Waiver Cost Review Policy with an effective date of October 1, 1999 (Policy Directive), which stated in pertinent part as follows: Effective October 1, 1999, individuals with an annual average cost in excess of Intermediate Care Facilities for persons with Developmental Disabilities (ICF/DD) shall only be enrolled into the waiver if the Secretary of the Department approves an exception. . . If the total costs to support an individual in the community exceed the ICF/DD cost, the plan must be submitted for review and approval or denial before the individual is added to the waiver. . . . On December 29, 2000, in accordance with the above Policy Directive, Petitioner's Proposed Support Plan was submitted to the Department's Tallahassee office for review. On January 19, 2001, Susan Dickerson, Chief concurred in the recommendation to approve the Proposed Support Plan with the following exceptions: Other Adaptive Equipment and stroller repairs and adaptations should be determined as medically necessary before approval. Physical therapy approved only for the amount in excess of coverage by Medicaid state plan. Family subsidy for $400.00 of general revenue funds monthly is not approved. WSC should explore other less costly options for providing services including attending a day program. (Emphasis furnished) On January 23, 2001, a reconsideration of Susan Dickerson's decision was requested, and on February 15, 2001, Kathleen A. Kearney, Secretary, concurred in the earlier recommendation, which included the same exceptions. By a Notice of Denial of Requested Service Funded Through General Revenue dated March 8, 2001, the Department advised Petitioner that her request for in-house subsidy had been denied because "Medical necessity for this service had not been demonstrated as defined in Chapter 59G-1.010(166), Florida Administrative Code." (Emphasis furnished). There was no other reason offered, including the unavailability of funds for this service under existing appropriations, given by the Department for denying Petitioner's request for the in-house subsidy. The Department has not alleged that funds were unavailable to provide the in-house subsidy to Petitioner. The final cost approved for the support plan was $82,718.96. The Petitioner has demonstrated a need for the in-home subsidy in the amount requested.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department enter a final order approving Petitioner's request for in-home subsidy in the amount of $400.00 per month. DONE AND ENTERED this 4th day of February, 2002, in Tallahassee, Leon County, Florida. WILLIAM R. CAVE 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 4th day of February, 2002. COPIES FURNISHED: Susan Haubenstock-Greenburg, Esquire Post Office Box 1588 Tampa, Florida 33601-1588 Frank H. Nagatani, Esquire Department of Children and Family Services 11351 Ulmerton Road, Suite 100 Largo, Florida 33778-1630 Peggy Sanford, Agency Clerk Department of Children and Family Services 1317 Winewood Boulevard Building 2, Room 204B Tallahassee, Florida 32399-0700 Josie Tomayo, General Counsel Department of Children And Family Services 1317 Winewood Boulevard Building 2, Room 204 Tallahassee, Florida 32399-0700
