15-003876MPI Agency For Health Care Administration vs. Lee Memorial Health System Gulf Coast Medical Center Status: Closed Recommended Order on Tuesday, January 26, 2016.

Summary: Sums paid on behalf of eligible aliens for emergency services provided by Respondent did not constitute an overpayment because the services were covered by Medicaid, as Petitioner had determined originally when it gave prior authorization to the claims.

! ,'"'

STATE OF FLORIDA :·_,·:;/;:::_

AGENCY FOR HEALTH CARE ADMINISTRATION

2016 APR -'-1 P 2: 58

STATE OF FLORIDA, AGENCY FOR

HEALTH CARE ADMINISTRATION,

DOAH CASE NO. 15-3876MPI

Petitioner, C.l. NO. 11-2531-000

v. PROVIDER NO. 011134100

RENDITION NO.: "()'2,3Ci -FOI-MDO

LEE MEMORIAL HEALTH SYSTEM

GULF COAST MEDICAL CENTER,

Respondent.

-------------------------------- I

FINAL ORDER

This case was referred to the Division of Administrative Hearings (DOAH) where the

assigned Administrative Law Judge (ALJ), John G. Van Laningham, issued a Recommended

Order after conducting a formal hearing. At issue in this proceeding is whether the Agency for

Health Care Administration ("Agency" or "AHCA") is entitled to recover alleged Medicaid

overpayments from Respondent for claims the Agency paid to it during the period from January

1, 2007 to December 31, 2007, relating to goods or services provided to undocumented aliens

whom DCF had found eligible for Medicaid for the period of an emergency medical condition.

The Recommended Order, dated January 26, 2016, is attached to this Final Order and

incorporated herein by reference, except where noted infra.

RULING ON EXCEPTIONS

Petitioner filed exceptions to the Recommended Order, and Respondent filed a response

to Petitioner's exceptions.

In determining how to rule upon Petitioner's exceptions and whether to adopt the ALJ' s

Recommended Order in whole or in part, the Agency must follow section 120.57(1)(1), Florida

Statutes (20 15), which provides in pertinent part:

The agency may adopt the recommended order as the final order of the agency.

The agency in its final order may reject or modify the conclusions of law over

which it has substantive jurisdiction and interpretation of administrative rules

over which it has substantive jurisdiction. When rejecting or modifying such

conclusion of law or interpretation of administrative rule, the agency must state

with particularity its reasons for rejecting or modifying such conclusion of law or

interpretation of administrative rule and must make a finding that its substituted

conclusion of law or interpretation of administrative rule is as or more reasonable

than that which was rejected or modified. Rejection or modification of

conclusions of law may not form the basis for rejection or modification of

findings of fact. The agency may not reject or modify the findings of fact unless

the agency first determines from a review of the entire record, and states with

particularity in the order, that the findings of fact were not based upon competent

substantial evidence or that the proceedings on which the findings were based did

not comply with essential requirements of law ....

§ 120.57(1)(1), Fla. Stat. Additionally, "[t]he final order shall include an explicit ruling on each

exception, but an agency need not rule on an exception that does not clearly identify the disputed

portion of the recommended order by page number or paragraph, that does not identify the legal

basis for the exception, or that does not include appropriate and specific citations to the record."

§ 120.57(1 )(k), Fla. Stat. In accordance with these legal standards, the Agency makes the

following rulings on Petitioner's exceptions:

Exception I

In Exception I, Petitioner takes exception to Paragraphs 11, 18, 51 (and by extension 52),

53, 54, 55, 56, 57, 58, 60, 61, 62, 65, 95, 96, 97, 98, 99, 100, 101, 102, 103, 106, 107, and

Endnote 12 of the Recommended Order, arguing the findings of fact and conclusions of law in

these paragraphs "misinterpret and confuse the respective roles of the Department of Children

and Families and the Agency for Health Care Administration in administering Florida's

Medicaid Program." The Agency agrees. The ALJ in this case has blurred the lines between the

agencies and, if not corrected, this will hamstring AHCA from performing its state and federally

required duties.

The Department of Children and Families ("DCF") is the state agency responsible for

determining whether persons are eligible 1 to enroll in Medicaid. § 409.902, Fla. Stat. 2 DCF

reviews applications for Medicaid enrollment submitted by or on behalf of individuals and

families to determine whether they meet the income, asset, and categorical eligibility tests set

forth in federal and state law such that they may be enrolled as Medicaid recipients.

§ 409.902, Fla. Stat.; § 409.903, Fla. Stat.; § 409.904, Fla. Stat. In determining whether an

applicant is categorically eligible to enroll in Medicaid based on a medical condition (such as

pregnancy, age, blindness or other disability, or the need for certain services, including

undocumented aliens in need of emergency medical services), DCF may consider any

documentation submitted to it by or on behalf of the applicant.

§ 409.902, Fla. Stat.;§ 409.903(5), (8), Fla. Stat.;§ 409.904(1), (2), (3), (4), (5), Fla. Stat. With

respect to undocumented aliens, DCF must consider the application and supporting

documentation to determine whether and when the alien had an emergency medical condition

("EMC"), as such aliens are only Medicaid-eligible for the period of the EMC. See

Respondent's Exhibit 27 at Pages 8-9; 42 U.S.C. § 1396b(v)(2); 42 C.P.R. § 440.255; § 409.902,

Fla. Stat.; § 409.904(4), Fla. Stat.; Fla. Admin. CodeR. 65A-1.715(1). However, in making its

eligibility determinations, DCF relies on the documentation provided to it, and does not

necessarily receive and review any medical records. See Respondent's Exhibit 27 at Pages 33-

34.

1 Webster's Dictionary defines the term "eligible" as "able to be chosen for something; able to do or receive

something; qualified to participate or be chosen." Merriam-Webster Dictionary, http://www.merriam­

webster.com/dictionary/eligible (last visited March 21, 20 16).

2 Unless otherwise stated, all statutory references from this point forward are to the 2006 and 2007 versions of the

Florida Statutes, which were in effect during the period when the claims at issue in this case were submitted to

AHCA for payment.

In contrast, AHCA is "the single state agency authorized to make payments for medical

assistance and related services under Title XIX of the Social Security Act," codified at 42 U.S.C.

§ 1396a, et seq. § 409.902, Fla. Stat. AHCA contracts with health care providers to provide

medical goods and services to enrolled Medicaid recipients, receives and pays the claims health

care providers submit for goods and services furnished, conducts claims audits, and recovers any

overpayments for paid claims that it determines were not reimbursable.

§§ 409.903-.906, Fla. Stat.; § 409.907(1)-(3), (5)(a), (5)(b), (7)-(9), Fla. Stat.; § 409.908, Fla.

Stat.; § 409.913(1)(e), (2), (3), (5), (7), (9), (11), (15), (20)-(23), (27), Fla. Stat. As part of its

post-payment audits, AHCA requests and then reviews the provider's contemporaneous records,

including medical records, supporting each audited claim to determine whether the goods or

services billed for were rendered in accordance with the requirements of federal and state

Medicaid law, including whether they were "medically necessary" for the recipient, as

determined by a contracted, licensed physician or "peer"; if not, the claim is not payable by

Medicaid, and AHCA may refuse to pay it or require repayment. § 409.905, Fla. Stat.;§ 409.906,

Fla. Stat.; §409.913(l)(d), (7)(b), (7)(t), (9), (11), (15), (20)-(23), Fla. Stat.;§ 409.9131, Fla.

Stat.; Fla. Admin. CodeR. 59G-1.010(166). See also 42 C.F.R. § 440.230(d); Moore ex rel.

Moore v. Reese, 637 F.3d 1220, 1232-33 (11th Cir. 2011) ("Although the standard of "medical

necessity" is not explicitly denoted in the Medicaid Act, it has become a judicially accepted

component of the federal legislative scheme .... Accordingly, even if a category of medical

services or treatments is mandatory under the Medicaid Act, participating states must provide

those medical services or treatments for Medicaid recipients only if they are 'medically

necessary."'). With respect to undocumented aliens, AHCA must make the additional

determination whether the goods or services billed were necessary to treat an EMC, as

determined by a contracted, licensed physician or "peer" and based on the provider's supporting

medical records; if not, the claim is not payable. See 42 U.S.C. § 1396b(v)(2); 42 C.F.R. §

440.255; § 409.902, Fla. Stat.; § 409.904(4), Fla. Stat.; § 409.913(l)(d), (7), (9), (11), (15)(b)­

(d), Fla. Stat.;§ 409.9131, Fla. Stat.; Fla. Admin. CodeR. 590-1.010(166).

Indeed, for Medicaid payment purposes, a provider's claims must be "documented by

records made at the time the goods or services were provided, demonstrating the medical

necessity for the goods or services rendered. Medical goods or services are excessive or not

medically necessary unless both the medical basis and specific need for them are fully and

properly documented in the recipient's medical record." § 409.913(7)(f), Fla. Stat. In addition, a

Medicaid provider must "retain medical, professional, financial, and business records pertaining

to services and goods furnished to a Medicaid recipient and billed to Medicaid for a period of 5

years after the date of furnishing such services or goods." § 409.913(9), Fla. Stat. Section

409.913(1)(d), Florida Statutes, expressly provides: "For purposes of determining Medicaid

reimbursement, [AHCA] is the final arbiter of medical necessity. Determinations of medical

necessity must be made by a licensed physician or "peer" employed by or under contract with

[AHCA] and must be based upon information available at the time the goods or services are

provided." See§ 409.901, Fla. Stat.;§ 409.9131(2), (5)(b), Fla. Stat.

AHCA cannot refuse to make payments to a Medicaid provider on the basis that it

believes DCF erroneously determined the recipient was eligible for Medicaid, based on the

application submitted to DCF. § 409.907(5)(b), Fla. Stat. However, AHCA can and must

refuse to pay the provider or require repayment if it finds a claim is not supported by the

provider's contemporaneous records, including medical records, demonstrating that the goods or

services billed for were provided in accordance with the requirement of law and were "medically

necessary" for the recipient, as determined by AHCA's contracted, licensed physician or "peer."

§ 409.905, Fla. Stat.;§ 409.906, Fla. Stat.; §409.913(1)(d), (2), (7)(b), (7)(f), (9), (11), (15), (20)­

(23), Fla. Stat.;§ 409.9131, Fla. Stat.

The difference in the roles played by the agencies is made quite clear in the record of this

case. In Respondent's Exhibit 56 at Pages 23-24, Tracy Ryder, an investigator with AHCA's

Bureau of Medicaid Program Integrity, testified that DCF "is determining eligibility to receive

Medicaid, while the other determination as performed by AHCA is to determine whether or not­

to determine the duration of the emergency medical condition in terms of the medical

presentation and care and the patient's response to treatment. It is a medical review." In

Respondent's Exhibit 23 at Page 64, Shevaun Harris, an administrator for AHCA's Bureau of

Medicaid Services, stated that "DCF determines a from and through date of when someone is

eligible for Medicaid but that does not mean that that person is eligible - would have a condition

that requires [AHCA] to pay for services during that entire time frame." In Respondent's Exhibit

24 at Page 57, Johnnie Shepherd, an administrator with AHCA's Bureau of Medicaid Program

Integrity, stated that "Department of Children and Families determines eligibility ... they do not

determine coverage." In Respondent's Exhibit 27 at Page 12, Dianna Laffey, the chief of

program policy for DCF, stated that "we just do the Medicaid eligibility piece, and then AHCA

is the one that pays claims in that. So from what I have always understood, they then determine

whether or not those services met that higher level, that higher threshold ... we don't determine

that because we don't get medical records." In Respondent's Exhibit 30 at Page 43, Beth

Kidder, AHCA's Deputy Secretary for Medicaid Operations, explained that "[e]ligibility and

coverage are two different things, and so I want to make that distinction that a span of eligibility

may be open but not all services would be covered for that person."

Thus, contra the ALJ's determinations, an application for Medicaid eligibility submitted

to DCF by or on behalf of a person seeking to enroll in the Medicaid program and a claim for

payment submitted to AHCA by a provider seeking reimbursement from Medicaid for a good or

service provided to an enrolled recipient have no meaningful overlap. The fact that DCF has

determined an undocumented alien is eligible for Medicaid due to an EMC based on the

documentation in the eligibility application does not mean that all claims submitted by a provider

for goods or services provided to the alien are payable by AHCA. The eligibility application and

claim are submitted to different agencies, by different persons, for different purposes, and require

different documentation and levels of documentation, i.e. type, detail, and completeness, in

support. The eligibility application reviewed by DCF may be accompanied by different

documentation, including medical records, than those maintained and supplied by the provider in

support of a claim for payment. For instance, this could occur if there was more than one

provider of goods or services, if the alien did not submit complete documentation to DCF, or if

the provider did not maintain and supply contemporaneous medical record supporting his or her

claims to AHCA upon request, as required by law.

Further, even assuming the same documentation is submitted in support of both an

application for Medicaid eligibility and a provider's claim for payment, DCF's eligibility

1 determination is not the equivalent of AHCA's medical necessity determination. AHCA utilizes

a contracted, licensed physician to conduct a medical review of claims and supporting

documentation; DCF's review of eligibility applications utilizes no such personnel and includes

no such component. Also, a provider may submit a bill to AHCA for goods or services that were

not provided in accordance with the requirements of law, were not medically necessary, or were

provided to treat some condition other than the EMC. The legislature has specified that AHCA is

the final arbiter of "medical necessity" for Medicaid payment purposes. § 409. 913( 1 )(d), Fla.

Stat.

For all of the aforementioned reasons and also for the reasons stated in AHCA's rulings

on its Exceptions II through VI, which are hereby incorporated by reference, the Agency hereby

rules on Petitioner's Exception I, as follows:

Paragraph 11 of the Recommended Order contains findings of fact that are not based on

competent, substantial evidence. As Dianna Laffey stated, DCF relies on the documentation

provided by the hospital in determining whether an EMC exists. See Respondent's Exhibit 27 at

Page 8-9. Therefore, the Agency grants Petitioner's Exception I to the extent that it modifies

Paragraph 11 of the Recommended Order as follows:

11. When an alien applies for Medicaid assistance, DCF, considers

the application and supporting documentation to determine

whether and when the alien had an EMC, as such aliens are only

Medicaid-eligible for the period of the EMC.follov1ing its rules,

turns to the health care provider for an opinion as to •.vheilier an

EMC exists and, if so, for an estimate regarding the length of time

th:e EMC will last. DCF relies on the documentation provided to it,

and does not necessarily receive and review any medical

records.generally accepts ilie provider's judgement on these

matters.

The findings of fact at Paragraph 18 of the Recommended Order are supported by

competent, substantial evidence. See generally Respondent's Exhibit 27. The Agency is not free

to reject or modify the ALJ's findings in this paragraph. See § 120.57(1)(1), Fla. Stat. (2015);

Heifetz v. Dep't of Bus. Reg., 475 So. 2d 1277, 1281 (Fla. 1st DCA 1985) (holding an agency

"may not reject the hearing officer's finding [of fact] unless there is no competent, substantial

evidence from which the finding could reasonably be inferred"). Therefore, the Agency must

deny Petitioner's Exception I as it pertains to Paragraph 18 ofthe Recommended Order.

Paragraph 51 of the Recommended Order consists solely of erroneous conclusions of law

that highlight the ALJ's misconceptions about the role AHCA plays in this matter. The Agency

finds that it has substantive jurisdiction over the conclusions of law in Paragraph 51 of the

Recommended Order because it is the single state agency in charge of administering Florida's

Medicaid program, and that it can substitute conclusions of law that are as or more reasonable

than those of the ALJ. Therefore, the Agency grants Petitioner's Exception I in-part and rejects

the conclusions oflaw in Paragraph 51 of the Recommended Order in their entirety.

The first two sentences of Paragraph 52 of the Recommended Order are erroneous

conclusions of law that highlight the ALJ's misconceptions about the role AHCA plays in this

matter. The Agency finds that it has substantive jurisdiction over the conclusions of law in the

first two sentences of Paragraph 52 of the Recommended Order because it is the single state

agency in charge of administering Florida's Medicaid program, and that it can substitute

conclusions of law that are as or more reasonable than those of the ALJ. Therefore, the Agency

grants Petitioner's Exception I in-part and modifies the conclusions of law in the first two

sentences ofParagraph 52 ofthe Recommended Order as follows:

52. To thread the needle, AHCA's solution is to change the subject

from "eligibility" to "compensability." This is canny, fur the two

concepts really are distinct, as AHCt\\ observes, and the application

of coverage provisions and exclusions is AHC'\\'s responsibility,

unlike the determination of eligibility, \\Nhich is not. AHCA's

position in regard to its authority to conduct the audit at issue in

this case is summed up in the following paragraph from its

Proposed Recommended Order:

18. Although DCF is initially responsible for

deciding whether a person is eligible to enroll in

Medicaid, only AHCA has statutory authority to

determine the compensability of a Medicaid service

(and, consequently, whether a Medicaid provider

was entitled to receive Medicaid payment for a

service). Those two roles may appear to overlap

where undocumented aliens are involved due to the

similarity of DCF's legal standard for enrollment

eligibility to AHCA's legal standard for service

payment compensability, however they are distinct

processes: each are performed by different (and

differently qualified) employees, who are reviewing

different documentation, for different purposes,

each applying separate and distinct legal standards

in light of the dissimilar role that they perform.

AHCA's PRO at 16.

Paragraph 53 of the Recommended Order contains erroneous conclusions of law

concerning the way that the audit at issue was conducted. Alternatively, it contains findings of

fact that are not supported by the record. The record of this case clearly demonstrates that the

Agency conducted the audit at issue in accordance with the provisions of section 409.913,

Florida Statutes, because it reviewed the claims to determine whether the services Respondent

provided to undocumented aliens were "medically necessary" to treat an EMC. See § 409.905,

Fla. Stat.; § 409.906, Fla. Stat.; §409.913(1)(d), (2), (7)(b), (7)(f), (9), (11), (15), (20)-(23), Fla.

Stat. The ALJ made two mistakes in reaching the conclusions of law in this paragraph. First, the

ALJ erred by concluding that none of the claims at issue were for services Respondent provided

to undocumented aliens for the treatment of a condition other than an EMC. Indeed, AHCA's

contracted physician reviewers found Respondent had billed for services that were not necessary

to treat an EMC. See Respondent's Exhibit 28 at Pages 12-13; Respondent's Exhibit 30 at Page

17; Respondent's Exhibit 31 at Pages 41 and 42-43; Respondent's Exhibit 32 at Pages 33-34 and

82. Second, the ALJ erred by concluding that Petitioner made its determinations about each

claim based on the date of "alleviation" instead of whether the services billed for were

"medically necessary" to treat an EMC. While the date of alleviation is an important part of

determining the medical necessity of each claim at issue, AHCA's overall focus was clearly on

whether the services Respondent billed for were medically necessary to treat an EMC. See

Respondent's Exhibit 28 at Pages 8, 10, 15-16. 18, 21, 26, 38-40 and 60-62; Respondent's

Exhibit 29 at Page 22; Respondent's Exhibit 31 at Pages 34-35, 46-47 and 50; Respondent's

Exhibit 32 at Page 36. The Agency finds that it has substantive jurisdiction over the conclusions

of law in Paragraph 53 of the Recommended Order because it is the single state agency in charge

of administering Florida's Medicaid program, and that it can substitute conclusions of law that

are as or more reasonable than those of the ALJ. Therefore, the Agency grants Petitioner's

Exception I to the extent that it modifies Paragraph 53 of the Recommended Order as follows:

53. This argument starts from premises which are true, in the

abstract, but it quickly begs the question by assuming, rather than

shovv'§ing, that In other words, AHCA is merely determining the

compensability of a service as opposed to the eligibility of a

person. In- The fact, that none of the claims at issue involves

particular services which AHCA alleges were not medically

necessary, for example, or were provided to treat some condition

other than the recipient's emergency medical condition is

irrelevant. Rather, tfor each claim at issue, AHCA is denying

demanded repayment from Respondent of monies AHCA paid to

Respondent, categorically, for aU-services Respondent rendered to

an undocumented alien that were not for the purpose of treating an

EMC. AHCA did so by determining whether the services provided

were for the treatment of an EMC, and, if so, when the EMC had

been "alleviated".after the so called "date of alleviation" on the

grounds that all such services, \\Vhatever they 'Here (for it does not

matter), constituted nonemergency or post "alleviation" care. To

repeat for emphasis, AHCA has reached this conclusion, in e'v'ery

instance, not based upon a determination about any particular

service, for the actual services truly are irrelevant to AHCA's

argument; but based on a determination about the recipient, namely

that this particular person's EMC, if he had one, ended or w:as

at least alleviated on a particular date.

Most of Paragraph 54 of the Recommended Order is legal argument taken directly from

Petitioner's Proposed Recommended Order. However, the last sentence of the paragraph is an

erroneous conclusion of law made by the ALJ based on the legal argument in Petitioner's

Proposed Recommended Order. The Agency finds that it has substantive jurisdiction over the

conclusion of law in the last sentence of Paragraph 54 of the Recommended Order because it is

the single state agency in charge of administering Florida's Medicaid program, and that it can

substitute a conclusion of law that is as or more reasonable than that of the ALJ. Therefore, the

Agency grants Petitioner's Exception I to the extent that the last sentence of Paragraph 54 of the

Recommended Order is modified as follows:

54. In this connection, AHCA asserts that it "has the authority and

legal obligation to ensure that state funds are not used to provide

medical services to undocumented aliens unless the services are

necessary to treat an emergency [medical] condition.' See §

409.902(2)(b), Fla. Stat." AHCA's PRO at 16. Thus, on the

authority of section 409.902(2)(b), AHCA claims the power to

refuse recoup monies it paid to Medicaid providers who provided

medical assistance on behalf of alien recipients for both

nonemergency services and services to treat alleviated

emergencies, alike.

Paragraph 55 of the Recommended Order contains conclusions of law concemmg

Petitioner's interpretation of section 409.902(2)(b), Florida Statutes. 3 The Agency must agree

with the ALJ's conclusions of law in this paragraph. Section 409.902(2)(b), Florida Statutes,

does not give the Agency the authority to recoup monies for claims it paid to Medicaid providers

who provided services to undocumented aliens. Instead, the authority for such action comes

from section 409.913.

Indeed, the preamble to section 409.913 requires the Agency to "operate a program to

oversee the activities of Florida Medicaid recipients, and providers and their representatives, to

ensure that fraudulent and abusive behavior and neglect of recipients occur to the minimum

3 Petitioner's argument concerning this section was erroneously raised because section 409.902(2)(b) is not

applicable to this case since it was not in existence at the times the claims at issue were submitted to AHCA for

payment. However, the Agency disagrees with the ALJ's conclusion that section 409.902(2)(b) is solely about

eligibility. The subsection addresses the use of state funds, which is clearly under AHCA's jurisdiction.

Nevertheless, because section 409.902(2)(b) was not enacted until after the time period at issue and is therefore

irrelevant to this matter, the Agency will not disturb Paragraph 55 of the Recommended Order as it pertains to this

case.

extent possible, and to recover overpayments and impose sanctions as appropriate." Section

409.913(11), requires the Agency to "deny payment or require repayment for inappropriate,

medically unnecessary, or excessive goods or services from the person furnishing them, the

person under whose supervision they were furnished, or the person causing them to be

furnished." Section 409.913(2), requires the Agency to "conduct, or cause to be conducted by

contract or otherwise, reviews, investigations, analyses, audits, or any combination thereof, to

determine possible fraud, abuse, overpayment, or recipient neglect in the Medicaid program and

shall report the findings of any overpayments in audit reports as appropriate." An

"overpayment" is defined by section 409.913(1)(e), Florida Statutes, as "any amount that is not

authorized to be paid by the Medicaid program whether paid as a result of inaccurate or improper

cost reporting, improper claiming, unacceptable practices, fraud, abuse, or mistake." Together,

these subsections authorize AHCA to conduct audits of provider claims, determine whether

goods or services rendered to an undocumented alien were medical necessary to treat an EMC

and, if not, to deny payment or require repayment.

Thus, Petitioner erred by arguing that it is section 409.902(2)(b), Florida Statutes, that

gives the Agency the authority to recoup monies it paid to Medicaid providers for services

rendered to undocumented aliens that were not for the treatment of an emergency medical

condition, rather than section 409.913, and the Agency must deny Petitioner's Exception I as it

pertains to Paragraph 55 of the Recommended Order.

Paragraph 56 of the Recommended Order also contains erroneous conclusions of law

concerning the respective roles of DCF and the Agency. Specifically, the ALJ concluded that

DCF decides whether an undocumented alien has an EMC, and, if so, what is the duration of the

EMC. As the ALJ correctly concluded in the first sentence of the paragraph, DCF determines

eligibility for services. However, as explained above, AHCA, not DCF, is the final arbiter on the

question of whether services rendered by a provider to an undocumented alien were "medically

necessary" to treat an EMC such that provider's claim should be paid. § 409.905, Fla. Stat.; §

409.906, Fla. Stat.; §409.913(l)(d), (l)(e), (7)(b), (7)(±), (9), (11), (15), (20)-(23), Fla. Stat.; Fla.

Admin. CodeR. 59G-1.010(166). The Agency finds that it has substantive jurisdiction over the

conclusions of law in Paragraph 56 of the Recommended Order because it is the single state

agency in charge of administering Florida's Medicaid program, and that it can substitute

conclusions of law that are as or more reasonable than those of the ALJ. Therefore, Petitioner

Exception I is granted to the extent that Paragraph 56 of the Recommended Order is modified to

state:

56. This matters because DCF, not AHCA, is responsible for

Medicaid eligibility determinations. § 409.902(1), Fla. Stat.

However, AHCA, not DCF, determine§ the eligibility of an alien

applicant, DCF whether a provider correctly billed Medicaid for

"medically necessary" goods or services rendered to an

undocumented alien for the treatment of an EMC. § 409.905, Fla.

Stat.; § 409.906, Fla. Stat.; §409.913(7)(b), (7)(f), (9), (11), (15),

(20)-(23), Fla. Stat.; Fla. Admin. CodeR. 59G-1.010(166). mHSt

make several findings of ultimate fact, including ·.vhether the

applicant has an emergency medical condition. If DCF determines

that the applicant does not ha-ve an EMC, then the applicant is

ineligible, and state funds may not be used to provide him

medical services. If, however, DCF determines that the applicant

does, in fact, have an EMC, then he is eligible to receive medical

assistance for all services necessary to treat that EMC (provided he

meets the other eligibility criteria as ·.vell) for the duration of the

EMC, which DCF must also determine. This obviously requires

DCF to decide, as a matter of fact, when the EMC was reduced to a

nonemergency condition, ending the period of the emergency

and with it, the recipient's eligibility.

Paragraph 57 of the Recommended Order also contains erroneous conclusions of law

concerning the Agency's authority. As explained above, the Agency has the authority to

determine whether goods or services rendered to an undocumented alien were "medically

necessary" to treat an EMC under section 409.913. To make this determination, AHCA must

look at whether the undocumented alien had an EMC that made the rendering of the services

billed "medically necessary." Thus, the ALJ erred in reaching a contrary conclusion of law. The

Agency finds that it has substantive jurisdiction over the conclusions of law in Paragraph 57 of

the Recommended Order because it is the single state agency in charge of administering

Florida's Medicaid program, and that it can substitute conclusions of law that are as or more

reasonable than those of the ALJ. Therefore, Petitioner Exception I is granted to the extent that

Paragraph 57 ofthe Recommended Order is modified to state:

57. Indeed, AHCA is the final arbiter of "medical necessity" for

purposes of determining Medicaid reimbursement (section

409.913(1)(d), Florida Statutes), which would include determining

whether services rendered were medically necessary to treat an

EMC when the recipient at issue is an undocumented alien.There is

no provision 81l)"Nhere in ehapter 4 09 that gives AHCA the

authority to deeide for itself v.rhether the reeipient had an EMC.

AHCA has no more authority to do that than it does to determine

for itself whether the reeipient met all applieable teelmieal

(ineluding resideney) and finaneial requirements for a Medieaid

eoverage group or any other faetor upon •.vhieh eligibility rests.

AHCA's assigned role is to determine the eompensability of the

serviees rendered to treat the EMC upon v.rhieh DCF based the

reeipient' s eligibility.

Paragraph 58 of the Recommended Order also contains erroneous conclusions of law

concerning the respective roles of DCF and the Agency. The Agency finds that it has

substantive jurisdiction over the conclusions of law in Paragraph 58 of the Recommended Order

because it is the single state agency in charge of administering Florida's Medicaid program, and

that it can substitute conclusions of law that are as or more reasonable than those of the ALJ.

Therefore, the Agency grants Petitioner's Exception I to the extent that Paragraph 58 of the

Recommended Order is modified to state:

58. Consequently, it is appropriate for AHCA to determine

whether, for example, the goods or services for which payment is

sought were necessary: to treat the EMC. In carrying

out thisits responsibility, however, AHCA fffilSt need not accept

DCF's finding that the recipient's condition was an EMC and its

determination of the duration of the EMC, which are made for

eligibility purposes only, as they may have been based on different

or incomplete information and documentation and were made

without the benefit of a medical review by a contracted physician. ,

just as AHCA must accept all of DCF's other findings in support of

eligibility, including the duration of the EMC. It would be absurd

if, after DCF determined an alien applicant was eligible on the

basis of an EMC, AHCA could make a contrary finding of fact to

re•rerse that determination and refuse all medical assistance.

Paragraph 60 of the Recommended Order also contains erroneous conclusions of law

concerning the respective roles of DCF and the Agency. The Agency finds that it has

substantive jurisdiction over the conclusions of law in Paragraph 60 of the Recommended Order

because it is the single state agency in charge of administering Florida's Medicaid program, and

that it can substitute conclusions of law that are as or more reasonable than those of the ALJ.

Therefore, the Agency grants Petitioner's Exception I to the extent that Paragraph 60 of the

Recommended Order is modified to state:

60. Indeed, this is such a basic proposition that it is set forth in the

definition of the "Medicaid program" found m section

409.901(16), which, again, states:

(16) "Medicaid program" means the program .

which provides for payments for medical items or

services, or both, on behalf of any person who is

determined by the Department of Children and

Families ... to be eligible on the date of service for

Medicaid assistance.

Every "good" or "service" that AHCA currently alleges resulted in

an overpayment to Gulf Coast was rendered to a person whom

DCF had determined to be eligible on the date of service for

Medicaid assistance because DCF had found accepted the

documentation submitted by or on behalf of the applicant

supporting that the recipient applicant had an EMC on that date

and thus met the requirements of subsection (2) of section 409.902,

without having a physician conduct a medical review. AHCA is

attempting to deny payment for these required repayment of the

monies it paid Respondent for goods or services,--net because it has

found any of them to have been excessive, medically unnecessary,

or provided to treat some complaint other than the condition which

DCF had found to be an EMC, but because it has determined that

the recipient of such services, contrary to DCF's finding, did not

have an EMC en the date 9} sen:ice and therefore, contrary to

DCF's finding, did not meet the eligibility requirements of section

409.902(2) en t.ltte date ofsenice has determined through a review

by a contracted physician that the contemporaneous documentation

submitted by Respondent in support of its claims is insufficient to

establish that the goods or services were "medically necessary" to

treat an EMC for Medicaid payment purposes. AHCA has this

authority under section 409.913, Florida Statutes.

Paragraph 61 of the Recommended Order also contains erroneous conclusions of law

concerning the respective roles of DCF and the Agency. The Agency finds that it has

substantive jurisdiction over the conclusions of law in Paragraph 61 of the Recommended Order

because it is the single state agency in charge of administering Florida's Medicaid program, and

that it can substitute conclusions of law that are as or more reasonable than those of the ALJ.

Therefore, the Agency grants Petitioner's Exception I to the extent that Paragraph 61 of the

Recommended Order is modified to state:

61. Simply put, AHCA is not shortening the period of the

emergency for each recipient, relative to DCF's determination of

that same period, to deny payment for medically necessary services

provided to recipients who were in fact, by virtue of DCF's prior

exercise of its exclusive power to grant Medicaid eligibility,

legally entitled to receive Medicaid assistance on the dates of

service. Instead, AHCA is reviewing the claims for payment to

ensure that the contemporaneous records, including medical

records, submitted by the Respondent support that the goods or

services billed for were provided in accordance with the

requirements of law and were "medically necessary" to treat an

EMC.There are no "separate and distinct legal standards" for

deciding "service payment compensability" questions at vrork here,

just the one and only definition of "emergency medical condition"

as applied to the historical facts of each recipient's ease to ascertain

v1hether, as DCF feHnd, the recipient had an EMC on the dates of

service. Every alleged overpayment in this ease reflects a

disagreement v1ith DCF as to the existence of an EMC on a

particular date based upon a de novo review of the recipient's

medical record.

The second sentence of Paragraph 62 of the Recommended Order contains an erroneous

conclusion of law regarding the respective roles of DCF and the Agency. The Agency finds that

it has substantive jurisdiction over the conclusion of law in the second sentence of Paragraph 62

of the Recommended Order because it is the single state agency in charge of administering

Florida's Medicaid program, and that it can substitute a conclusion of law that is as or more

reasonable than that of the ALJ. Therefore, the Agency grants Petitioner's Exception I to the

extent that Paragraph 62 of the Recommended Order is modified to state:

62. As we have seen, an alien who does not have an EMC on a

particular date is not eligible for Medicaid assistance on that date.

AHCA's intended agency action here is tantamount to not the

retroactive revocation of each recipient's eligibility before the date

his or her eligibility expired automatically pursuant to DCF's

determination regarding the duration of the recipient's EMC.

Rather, AHCA is simply carrying out its statutory duty to audit

claims and determine whether Respondent correctly billed

Medicaid only for those goods or services that were provided in

accordance with the requirements of law and were medically

necessary to treat the Medicaid-eligible undocumented alien's

EMC, as supported by the Respondent's contemporaneous records,

including medical records, and determined by AHCA's contracted

physician.

Paragraph 65 of the Recommended Order contains erroneous conclusions of law

concerning the respective roles of DCF and the Agency. As stated above in the ruling on

Exception I as it pertains to Paragraphs 55 and 56 of the Recommended Order, the Agency

reviewed the claims at issue in order to determine whether Respondent had correctly billed

Medicaid for services provided to undocumented aliens for the treatment of an EMC. The

Agency has the authority to make such a determination under section 409.913. Thus, the Agency

finds that it has substantive jurisdiction of the conclusions of law in Paragraph 65 of the

Recommended Order because it is the single state agency in charge of administering Florida's

Medicaid program, and that it can substitute conclusions of law that are as or more reasonable

than those of the ALJ. Therefore, the Agency grants Petitioner's Exception I to the extent that

Paragraph 65 of the Recommended Order is modified to state:

65. In substance and effect, AHCA is determining whether

Respondent correctly billed Medicaid only for those goods or

services that were provided in accordance with the requirements of

law and to treat the Medicaid-eligible undocumented alien's EMC,

as supported by the Respondent's contemporaneous records,

including medical records, and determined by its contracted

physician.when a recipient's eligibility enabling EMC was reduced

to an eligibility ending nonemergency medical condition, using the

malleable term "alleviation" to create the plausible appearance that

something else is going on. Nothing else is. AHCA's Respondent's

insistence to the contrary notwithstanding, the Undocumented

Alien Project is not an effort to re-determine eligibility.

Paragraphs 95-103 of the Recommended Order contain erroneous conclusions of law

concermng the respective roles of DCF and the Agency. As explained above, DCF only

determines eligibility for services. Respondent still has the affirmative duty to only bill

Medicaid for services rendered to undocumented aliens for the treatment of an EMC, and the

Agency has the responsibility to determine whether Respondent fulfilled its duty. DCF's

eligibility determinations in no way, shape, or form prohibit the Agency from reviewing

Respondent's claims for payment in order to determine whether Respondent complied with the

law. The ALJ's conclusion that AHCA is collaterally attacking DCF's eligibility determinations

is without merit and further demonstrates his lack of understanding in regard to difference

between the roles DCF and AHCA play in regard to the Medicaid program. While the ALJ is

correct that AHCA cannot dispute DCF's eligibility determinations, those determinations do not

bar AHCA from carrying out its duty to ensure that it only pays providers for goods or services

that are medically necessary to treat an undocumented alien's EMC. § 409.905, Fla. Stat.; §

409.906, Fla. Stat.; §409.913(l)(d), (l)(e), (7)(b), (7)(f), (9), (11), (15), (20)-(23), Fla. Stat.; Fla.

Admin. Code R. 59G-1.010(166). Thus, the Agency finds that it has substantive jurisdiction

over the conclusions of law in Paragraphs 95-103 of the Recommended Order because it is the

single state agency charged with administering Florida's Medicaid program, and that it can

substitute conclusions of law that are as or more reasonable than those of the ALJ. Therefore,

the Agency grants Exception I to the extent that it modifies the conclusions of law in Paragraphs

95-103 of the Recommended Order to state:

95. Assuming, however, Neither administrative finality nor section

409.905(5)(a) operates as a bar to this action,.!. there are alternate

grounds for denying Further, Respondent's argument that AHCA's

demand for repayment, vihich from the fact that, in reality,

AHCA is attempting to re-determine eligibility is also without

merit.

96. To begin with a brief review, the bottom line is that under the

Undocumented Alien Project, AHCA is determining whether

Respondent correctly billed Medicaid only for those goods or

services that were provided in accordance with the requirements of

law and were medically necessary to treat the Medicaid-eligible

undocumented alien's EMC, as supported by the Respondent's

contemporaneous records, including medical records, and

determined by AHCA's contracted physician.for itself (i) vihether

each alien recipient actually had an eligibility enabling EMC, and

(ii) with respect to each such EMC recognized, the date upon

vihich the recipient's complaint went from being an EMC to an

eligibility ending nonemergency medical condition. These very

questions, as v1e have seen, were previously and conclusively

resolved by DCF, the only agency having the authority to

determine Medicaid eligibility. See § 409.902(1), Fla. Stat. DCF

necessarily found as a matter of ultimate fact that each recipient

had a qualifying EMC and that the EMC lasted for a specific

period of time comprising the dates of the recipient's eligibility.

These findings were part and parcel of the final agency action

taken on each recipient's application for medical assistance. Under

the doctrine of administrative finality, discussed above, DCF

cannot revisit and re-determine its decisions respecting the

eligibility of these recipients.

97. However, DCF's eligibility determinations do not relieve

Respondent of its duty to correctly bill Medicaid for "medically

necessary" goods or services rendered to an undocumented alien

for the treatment of an EMC. § 409.905, Fla. Stat.; § 409.906, Fla.

Stat.; §409.913(7)(b), (7)(0, (9), (11), (15), (20)-(23), Fla. Stat.;

Fla. Admin. CodeR. 590-1.010(166). AHCA is now trying to do

vihat DCF itself could not accomplish. Unlike DCF, however,

AHCA does not even have jurisdiction to define or decide

eligibility. Booker Creek Pres., Inc. v. Sw. Fla. '.Vater Mgmt. Dist.,

534 So. 2d 419, 424 (Fla. 5th DCA 1988)(0ne agency may not

exercise jurisdiction that has been delegated to another state

agency). Such a lack of jurisdiction could not be cured by a rule,

for A.HCA cannot confer regulatory jurisdiction upon itself. See

Saddlebrook Resorts v. Wiregrass Ranch, 630 So. 2d 1123, 1128

(Fla. 2d DCA 1993)("A,n agency cannot enlarge, reduce, or modify

its jurisdiction its ovm action .... Since an agency car.not

confer jurisdiction upon itself, the adoption of an agency rule

should have no effect upon jurisdiction."), affd, 645 So. 2d 374

(Fla. 1994). AHCA does not ha§.¥e the authority, therefore, to

recover as an overpayment amounts paid for medically necessary

emergencygoods or services provided to an alien recipient that

were not provided in accordance with the requirements of law or

medically necessary to treat an EMC even though the alien

recipientwhe, according to DCF, was eligible on the dates of

service for Medicaid assistance.

98. Respondent's argument !hat AHCA is attempting to exercise

jurisdiction it does not possess is seen most easilyseems plausible

in relation to R3, R16, R19, and R20, the recipients who, by

A.HCA's lights, never had an EMC, according to AHCA's

contracted physician reviewer. Having an emergency medical

condition is should be a sine qua non for alien eligibility. However,

Therefore, AHCA:' s position that these recipients never had EMCs

is in direct and irreconcilable conflict with DCF's eligibility

determinations, which necessarily held that each of them did have

an EMC, may have been based on different or incomplete

information and medical documentation and were made without

the medical expertise of a physician. Agreeing with AHCA weuld

be is not tantamount to reversing DCF's eligibility determinations

and retroactively deeming R3, R16, R19, and R20 ineligible for

assistance. Clearly that cannot be done. ≻⵹, the Agency's

demand for repayment of the $24,819.61 paid to Gulf Coast for

providing services to these recipients is based on its determination

that Respondent billed Medicaid for goods or services that were

not provided in accordance with the requirements of law and

medically necessary to treat the Medicaid-eligible undocumented

alien's EMC, as supported by the Respondent's contemporaneous

records, including medical records, and the medical review

conducted by AHCA's contracted physicianpatently ultra vires.

99. With respect to the remaining recipients, AHCA's re

determination of eligibility is somevihat more difficult to observe,

due to the alle-viation smokescreen. A.s explained above, however,

·.vhen it comes to it, all AHCA is doing is not re-defining these

recipients' respective eligibility periods by deciding they had

nonemergency conditions as of their "dates of alleviation."

Agreeing with AHCA would not reverse DCF's decisions that Rl,

R4, R15, R18, and R23 were eligible, but-it nor would !Lin effect_,_

retroactively revoke the eligibility of each of these recipients,

leaving them with fewer days of eligibility than DCF had granted.

That, too, would be ultra vires.

100. Viewing AHCA's proposed agency action from a slightly

different angle, it cannot fairly be characterized as a collateral

attack on the final actions taken by DCF in granting the recipients'

applications for medical assistance. This is because AHCA's

position does not necessarily impliesy that DCF erred (i) in

determining that R3, R16, R19, and R20 had EMCs and (ii) in

determining that the periods of Rl, R4, R15, R18, and R23's

emergencies lasted as long as DCF found they did because DCF's

determinations may have been based on different or incomplete

information and documentation than AHCA reviewed in

conducting the audit at issue, and were not made by a physician.

Neither AHCA nor this Administrative La'.v Judge, howe-ver, has

"collateral review power over final agency action taken after

regular proceedings under other provisions of the [Administrative

Procedure] Act." Dep't of HR8 v. Barr, 359 8o. 2d 503, 505 (Fla.

1st DCA 1978). Thus, AHCA's intended action cannot lawfully be

implemented.

1 01. This common law arrest of collateral action is codified in

409.907(5)(b), \\vhich states that AHCA is "prohibited

from demanding repayment from the provider in any instance in

which the Medicaid overpayment is attributable to agency error in

the determination of eligibility of a recipient." Here, DCF

determined that Rl, R3, R4, R15, R16, R18, R19, R20, and R23

were each eligible for Medicaid assistance on the dates that Gulf

Coast treated them. However, 409.907(5)(b) does not

assures providers such as Gulf Coast that they can rely upon

DCF' s eligibility determinations when billing Medicaid for the

goods or services they provide. Providers still have an affirmative

duty to bill true and accurate claims for goods and services that are

medically necessary and were provided in accordance with the

applicable Medicaid rules, regulations, handbooks, and policies,

and federal, state, and local laws. § 409.913(7)(b), (e), Fla. Stat.;

see also Florida Medicaid Provider General Handbook at 5-4.

Providers also have an affirmative have a duty to maintain

contemporaneous records, including medical records, in support of

their claims, and to supply those records to AHCA when requested.

§ 409.913(7), (9), Fla. Stat.

102. AHCA is demanding that Gulf Coast repay an alleged

overpayment for goods or services that were not provided to treat

that 'tvould be, if AHCA's theory of the case were credited,

attributable to findings establishing (retroactively) that R1, R3, R4,

R15, R16, R18, R19, R20, and R23's EMCs.vrere not eligible on

the dates of service after all, contrary to DCF's determinations,

which could only mean that DCF had erred. Section 409.907(5)(b)

prohibits the Agency from recouping such an overpayment and

thus forecloses this action.

103. If this proceeding 'Nere not doomed to fail for one or more of

the multiple grounds set forth above, however, thenThus, the

question for decision--presented de novo--would be whether

the claims at issue were authorized to be paid by Medicaid. To

arrive at an alternative ratio decidendia final determination, the

undersigned will examine this question.

Paragraphs 1 06 and 107 of the Recommended Order contain erroneous conclusions of

law concerning the respective roles of DCF and the Agency. The Agency finds that it has

substantive jurisdiction over the conclusions of law in Paragraphs 106 and 107 of the

Recommended Order because it is the single state agency in charge of administering Florida's

Medicaid program, and that it can substitute conclusions of law that are as or more reasonable

than those of the ALJ. Therefore, the Agency grants Exception I to the extent that Paragraphs

106 and 107 of the Recommended Order are modified to state:

106. As for the second question, "services [which] are necessary to

treat an emergency medical condition" fall within the scope of

Medicaid's coverage. § 409.902(2)(b), Fla. Stat. The Agency will

only pay for these goods and services, and not for any goods or

services rendered to an undocumented alien after the EMC has

been alleviated, as determined by its contracted physician after

reviewing the provider's contemporaneous records, including

medical records, supporting the claim(s). See Page 2-7 of the

Florida Hospital Services Coverage and Limitations Handbook

(incorporated by reference into Rule 590-4.160(2), Florida

Administrative Code). Having an "emergency medical condition"

as that term is defined in section 409.901(10)(a) is a necessary

condition of Medicaid eligibility for aliens. An alien can have an

EMC and not be eligible, but he cannot be eligible and not have an

EMC. Thus, the undisputed fact that each recipient was eligible on

the date of each service conclusively establishes that each recipient

had an emergency medical condition on the date of each service.

107. AHCA has neither alleged nor attempted to proven that any-ef

the goods or services in question were not provided to treat a

complaint other than an EMC. the condition which DCF

determined '.vas sufficient to satisfy the EMC requirement for alien

eligibility. While AHCA concedes, moreover, that all of the

services were medically necessary,. Thus, not all of the services at

issue were medically necessary to treat an EMC. The second

question must be answered ¥E-SNO, and the third question does

not apply.

Endnote 12 of the Recommended Order is an erroneous conclusion oflaw concerning the

Agency's substantive jurisdiction. Contrary to the ALJ's conclusion, sections 409.902(2) and

409.904(4), Florida Statutes, are within the Agency's substantive jurisdiction because the

Agency is the single state agency in charge of administering Florida's Medicaid program. The

Agency finds that it has substantive jurisdiction over the conclusion of law in Endnote 12 of the

Recommended Order because it is the single state agency in charge of administering Florida's

Medicaid program, and that it can substitute a conclusion of law that is as or more reasonable

than that of the ALJ. Therefore, the Agency grants Exception I to the extent that it rejects

Endnote 12 of the Recommended Order in its entirety.

Exception II

In Exception II, Petitioner takes exception to Paragraphs 32, 34, 35, 37, 38, 39, 40, 41,

43, 45, 46, 48, 49, 50, 51, 64, 88, 108, and Endnote 10 ofthe Recommended Order, arguing that

the ALJ's conclusions of law in these paragraphs misinterpret the Agency's rules with regard to

what the term "alleviate" means. This specific issue was previously litigated in Bayfront

Medical Center et al. v. Agency for Health Care Administration, DOAH Case No. 12-2757RU

(Fla. Div. Admin. Hrgs. Dec. 21, 2012) ("Bayfront I") and Bayfront Medical Center et al. v.

Agency for Health Care Administration, DOAH Case No. 14-4758RU (Fla. Div. Admin. Hrgs.

Apr. 20, 2015) ("Bayfront II"). The ALJ's interpretation of the Agency's rules is in direct

conflict with Bayfront II. In Bayfront II, the ALJ concluded:

"Alleviate" has a plain and ordinary meaning ... The Medicaid

Program statutes use "alleviate" frequently without explication.

§ 409.913(1)(d), Fla. Stat. (defining "medical necessity"

as "goods or services necessary to palliate the effects of a terminal

condition, or to prevent, diagnose, correct, cure, alleviate, or

preclude deterioration of a condition that threatens life, causes pain

or suffering, or results in illness or infirmity, which goods or

services are provided in accordance with generally accepted

standards of medical practice") (emphasis added); § 409.906(1)(a),

Fla. Stat. (authorizing AHCA to pay for "medically necessary,

emergency dental procedures to alleviate pain or infection")

(emphasis added); § 409.9131(2)(b), Fla. Stat. (defining "medical

necessity" or "medically necessary" as "any goods or services

necessary to palliate the effects of a terminal condition or to

prevent, diagnose, correct, cure, alleviate, or preclude deterioration

of a condition that threatens life, causes pain or suffering, or results

in illness or infirmity, which goods or services are provided in

accordance with generally accepted standards of medical

practice"). (emphasis added). The Hospitals' contention that

Agency representatives Harris and Shepherd cannot explain the

meaning of "alleviate" is not supported by the citations to their

deposition transcripts. The questioning cited involved repeated

efforts to tie the representatives to the "stabilization" standard

rejected as an unadopted rule. When the meaning of "alleviated"

was not tied to the Agency's previous position, the witnesses were

consistent that the dictionary meaning should apply.

Bayfront II at Pages 37-38. The ALJ in this case failed to even acknowledge the existence of the

final order in Bayfront II, much less offer any explanation for why he disagreed with its

reasoning. The Agency, however, will follow and hereby adopts by reference the precedent of

Bayfront II, which held that the Agency's use of the plain and ordinary meaning of "alleviate"

for determining whether services rendered to an undocumented alien were "medically necessary"

to treat an EMC for claims payment purposes is lawful.

For the above-stated reasons and also for the reasons set forth in AHCA's rulings on

Exceptions I, and III through VI, which are hereby incorporated by reference, the Agency finds

that it has substantive jurisdiction over the conclusions of law in these paragraphs because it is

the single state agency in charge of administering Florida's Medicaid program, and that it can

substitute conclusions of law that are as or more reasonable than those of the ALJ. Therefore,

Petitioner's Exception II is denied as it pertains to Paragraph 45 of the Recommended Order, and

is granted to the extent that the Agency rejects Paragraphs 35, 37, 38, 40, 41, 46, 48 (and, by

extension, Endnote 11), 51, 88 4 , 108 and Endnote 10 of the Recommended Order in their

entirety, and modifies Paragraphs 32, 34, 39, 43, 49, 50, and 64 of the Recommended Order to

state:

32. The focus on "alleviation" as a critical moment in the course of

an EMC was inspired by is taken from the Handbook provisions

comprising the Statement on the Eligibility of Aliens for Services,

or SEAS, introduced above. Under the Undocumented Alien

Project, 8EA8 acquired a new, aggressively prescriptive quality, as

AHCA conceived the theoryapplied the Handbook provisions and

determined that medical items goods or services furnished to an

alien recipient after his EMC has been "alleviated" are not

authorized to be paid under Medicaid. As support for this

proposition, AHCA makes mention of sections 409.902(2)(b) and

409.904(4), but mainly it relies on SEAS.

34. AHCA has not publicly either defined the term "alleviation,"

or specified the criteria to be applied in determining the point at

which a recipient's EMC was "alleviated," for the purposes of

SEAS. To the contrary, i\\HCA has eschevled making a clear

statement concerning its construction of this supposed exclusion,

with the result that there is, in fact, no official agency

interpretation to '.vhich a court could defer v1ere it inclined to do

S&.-According to AHCA, no authoritative interpretation is needed

because the word "alleviation" is plain and unambiguous. Thus,

AHCA claims that its physician peer reviewers are asked only to

apply SEAS according to the common "dictionary definition" of

the crucial term as they understand it in the context of an EMC and

using their medical knowledge, background, expertise, and

training.

4 Paragraph 88 is also addressed in the ruling on Petitioner's Exception IV.

39. Looking to capitalize on the term's elasticity, tihe Agency

argues that the alleviation of an emergency condition can occur

anytime, regardless of when, even including after, the EMC ends.

This, clearly, goes too far. Logically, the point of alleviation must

occur at or before the recipient's condition ceases to be an EMC

meeting the statutory criteria, because once a medical condition

has improved to the point that it stops being an "emergency

medical condition" within the statutory definition, it can no longer

be alleviated as such.8/ Still, a term broad enough to describe

something that literally can happen anytime, indeed multiple times,

during the existence of an EMC is not a benchmark but a license.

43. If the point at which an emergency medical condition was

"alleviated" is to be used as the basis for excluding from otherwise

payable claims amounts for medically necessary emergency

services, as AHCA urges, then the undersigned must find, for each

recipient, the date upon which his or her EMC was alleviated,

since that is a matter of ultimate fact. In this fact finder's

estimation, the dictionary definition of "alleviate" Vt'ill not cut the

mustard as a standard fur decision. 8EA8 must be interpreted or at

least explicated.

49. The Agency directs its peer reviewers to use the common

"dictionary definition" of alleviation, as they understand it, and

their medical knowledge, background, expertise, and training to

determine whether a provider's claim for goods or services

provided to an undocumented alien were "medically necessary to

treat an EMChis, actually, is vihat the Agency covertly understands

8EA8 to mean, as it occasionally reveals, although this truth is

always well attended by a bodyguard of disclaimers. Ms. Ryder

testified, for example, as follows:

Q. How would you get a uniform decision amongst

peer reviewers if you're not telling them how much

it has--an emergency medical condition has to be

lessened for it to be alleviated?

A. Well, [to be alleviated,] the--[emergency

medical condition] would have to be lessened to the

point that it wouldn't--! would assume it would

no longer be considered an emergency condition. I

mean, you know, what I'm saying is I really can't

answer that question because I'm not a medically

trained doctor.

Tr. 191:8-14 (emphasis added). Or, as AHCA's counsel put it:

[W]e don't want to compare alleviate to the end of

an emergency medical condition because that's not

how our rule is written. The only reason why we're

answering that question in as direct a way as

possible is because you're asking us to . . . and I

think as you read through these [deposition]

transcripts, most of the peer reviewers when pressed

on cross-examination [to answer the question:] ["I]s

the alleviation point the same point as--that the

emergency medical condition no longer exists[?,"]

most of them, for the facts they're reviewing, that's

what they--most of them eventually come to that

point when pushed hard enough on cross­

examination. But all of them, I think, along with the

corporate--the Agency representative ... , [a]ll

we're trying to say is [that] that's not what we were

doing because we're trying to apply the common,

ordinary meaning of the terms in our rule.

Tr. 71 :25-73:2 (emphasis added).

50. In truth, although they had to be "pushed hard" to say so, the

peer reviewers did look forconsider the end of the emergency

medical condition in forming their opinions about when an

emergency was alleviated, a fact which becomes reasonably clear

upon reviewing their Case Detail Reports, and is evident

notwithstanding the strong resistance all put up against admitting

as much when questioned under oath. Given that, the question

naturally arises: '.Vhy is the Agency so reluctant to acknowledge

the obvious, namely that in this context "alleviated" means, as it

can only mean, rethtced te tl nenemergency· medictJl cenditien?

64. AHCA relies upon SEAS as authority for disallowing payment

for services after the date of alleviation, arguing that SEAS

imposes an exclusion from coverage that resembles, but is distinct

from, the eligibility restriction which limits alien recipient

eligibility to the period of the emergency. AHCA's reliance upon

8EA8 is misplaced, however, because (i) the plain and

unambigHoHs language of 8EA8 can reasonably be Hnderstood in

only one sense, i.e., as a description of the requirements for, and

the temporal limitation on, Medicaid eligibility for aliens; and, (ii)

to the eJttent 8EA8 is SHsceptible of more than one reasonable

interpretation and hence ambigHoHs, it mHst be construed as a

description of the conditions of eligibility to avoid a conflict with

federallavr that would implicate the Supremacy Clause.

Exception III

In Exception III, Petitioner takes exception to Paragraphs 42, 43, 69, 70, 71, 111, and 112

of the Recommended Order, arguing that the ALJ's decision that the testimony of Petitioner's

peer reviewers should be rejected because the ALJ's perceived vagueness of the "alleviation"

standard they used is erroneous and not supported by the record of the case. Indeed, there is no

competent, substantial evidence to support the ALJ' s finding that "the peer reviewers' opinions

as to when the alleviation points were reached are necessarily based on undisclosed subjective

principles." The competent, substantial evidence of this case instead demonstrates that the peer

reviewers' are licensed physicians whose opinions as to when the alleviation points were reached

were based on their review of Respondent's medical records provided in support of each claim

for payment, as well as their education, training and experience, and were made with a

reasonable degree of medical certainty. See Respondent's Exhibit 28 at Pages 8, 10, 13-14, 15-

16, 18, 19, 21, 26, 27, 52, 56 and 76-78; Respondent's Exhibit 29 at Pages 15-17 and 21-22;

Respondent's Exhibit 30 at Page 16; Respondent's Exhibit 31 at Pages 38-39, 40-41, 46-47 and

67-68; Respondent's Exhibit 32 at Pages 14, 36. Respondent was given the opportunity to cross­

examine each peer reviewer as well as present its own expert testimony, which it did not do. The

ALJ departed from the essential requirements of law by brushing the peer reviewers' testimony

aside as unsupported dogmatic statements (or "ipse dixits" as he called them) instead of

weighing their testimony against the other evidence presented in this matter. Thus, to the extent

that these paragraphs contain findings of fact, the Agency concludes after a review of the entire

record that the proceedings on which the findings of fact are based did not comply with the

essential requirements of law such that the Agency is permitted to reject or modify these findings

of fact. See§ 120.57(1)(1), Fla. Stat. (2015) To the extent these paragraphs contain conclusions

of law, the Agency finds that it has substantive jurisdiction over the conclusions of law because

it is the single state agency charged with administering Florida's Medicaid program, and that it

can substitute conclusions of law that are as or more reasonable than those of the ALJ.

Therefore, for these reasons, and also for the reasons stated in AHCA's rulings on its Exceptions

I, II, and IV through VI, which are hereby incorporated by reference, the Agency grants

Petitioner's Exception III to the extent that it rejects Paragraph Ill ofthe Recommended Order,

and modifies Paragraphs 42, 69, 70, 71 and 112 of the Recommended Order as follows:

42. What this means is that, lacking a uniform foundation of

neutral principles prescribing authoritatively for everyone affected

precisely how much relief or whtlt degree of lessening of the

severity of an EMC constitutes "alleviation,"The unrebutted

evidence of this case shows that the peer reviewers' opinions as to

when the alleviation points were reached are necessarilywere based

upon their education, training and experience, as well as a review

of Respondent's medical records for the claims at issue. Further,

they constitute the only testimony as to the dates of alleviation of

the EMCs, as demonstrated in the medical records supporting each

of Respondent's claims for payment, in this matter.undisclosed

subjective principles, making them the mere ipse dixits of

credentialed v1itnesses, which AHCA e)cpects will simply be

accepted unconditionally as valid. Indeed, the Agency's

representative, Tracy Ryder, admitted as much Vtrhen she testified

at hearing as follows:

Q. Okay. How much was the emergency medical

condition to be lessened to be--how much was it

required to be lessened for it to be alleviated?

A. That would be for a peer reviewer to determine.

T r. 191 :3-7. To the undersigned, v.rhose responsibility as the trier

of fact in this de novo proceeding is to determine, vlhere relevant,

such facts as the "dates of alleviation," the peer re'vievrers' opinions

are practically worthless because they rest almost entirely on the

authority of the respective witnesses and cannot be independently

verified or falsified.

69. The opinions ofthe peer reviewers that R3, R16, R19, and R20

never had an emergency medical condition for purposes of the

claims at issue, and as supported by the provider's

contemporaneous documentation, are unrebuttedrejected as

irrelevant because DCF determined that each of these recipients

did have an EMC that made it possible for him or her to be eligible

for Medicaid assistance during the period of his or her emergency.

Accordingly, each of these recipients met the requirements of

section 409.902(2)(b), and state funds could be used to provide

them medical services, as AHCA found when it pre authorized for

payment all of Gulf Coast's claims for the services it rendered to

these recipients. NThus, AHCA has demonstrated that it overpaid

Respondent for the claims it submitted for recipients yment \\Vas

shown to htvre been made on beha:lfofR3, R16, R19, or R20.

70. The opinions of the peer reviewers that Rl, R4, R15, R18, and

R23 received post-"alleviation" treatment are also

unrebuttedrejected as irrelevant because (i) DCF determined that

each of these recipients had an EMC that made it possible for him

or her to be eligible for Medicaid assistance during the entire

period of his or her emergency, which period in each case

e)ctended, by order of DCF, beyond the recipient's "date of

alleviation" as identified much later by AHCA; and (ii) all of the

alleged post "alleviation" services were provided to a recipient

who had been determined by DCF to be eligible on the date of

service for Medicaid assistance.

71. Accordingly, Rl, R4, Rl5, Rl8, and R23 met the requirements

of sections 409.902(2)(b) and 409.904(4), and state funds could be

used to provide them medical services, as AHCA found vrhen it

pre authorized for payment all of Gulf Coast's claims for the

services it rendered to these recipients. No Thus, AHCA has

demonstrated that it overpaid Respondent for claims Respondent

billed AHCA for services provided to yment was shovm to have

been made on behalf of R1, R4, Rl5, R18, or R23.

112. Because the sequence of answers is YES-¥ES-NO-N/ANG, it

is concluded that the amounts in question were not authorized to be

paid by Medicaid, and AHCA has failed to proven the alleged

overpayment.

The Agency will make no further modifications to Paragraph 43 of the Recommended Order

beyond those enumerated in the ruling on Petitioner's Exception II supra.

Exception IV

In Exception IV, Petitioner takes exception to Paragraphs 16, 17, 19, 20, 27, 30, 63, 80,

81, 82, 83, 84, 86, 88, 89, and Endnotes 7 and 15 of the Recommended Order, arguing that the

ALJ's findings of fact and conclusions oflaw that the Agency's prior authorization ofthe claims

at issue constituted an administrative adjudication of these claims, made their payment akin to a

final order, and barred the Agency from recovering overpayments on those claims under the

doctrine of administrative finality, is erroneous. The Agency agrees with Petitioner.

Florida Medicaid requires providers to receive "prior authorization" from AHCA or its

contracted agent, here KePRO, to deliver certain goods and services to a Medicaid recipient prior

to delivering the good or service or prior to submitting a claim to AHCA for payment. See §

409.905(4)(a), (5)(a), (23), Fla. Stat.; 409.908(2)(a)2., (18), Fla. Stat.; § 409.912, Fla. Stat.; §

409.9128, Fla. Stat.; § 409.913(15)(d), (15)(i), (16)(c), Fla. Stat.; Fla. Admin. Code R. 590-

1.01 0(226). A request for prior authorization must be reviewed by a contracted, licensed

physician, who makes a preliminary determination, based on the documentation submitted with

the request, that the requested good or service is medically necessary for the recipient. See

Medicaid Provider Reimbursement Handbook, UB-92 (April 2004) at Pages 2-2, 2-5, 2-9, 2-

14and 2-18, incorporated by reference in Rule 590-4.160, Florida Administrative Code;

Medicaid Provider Reimbursement Provider Handbook, UB-04 (May 2007) at Pages 2-2, 2-3, 2-

7,2-17 and 2-20, incorporated by reference in 590-4.003, Florida Administrative Code. Ifprior

authorization is granted, the provider may provide the goods or services and then submit a claim

to AHCA, which will be paid if supported by contemporaneous medical records demonstrating

the good or service was provided in accordance with the requirements of law, including medical

records demonstrating it was "medically necessary" for the recipient. See § 409.913(7), Fla.

Stat. If prior authorization is denied, the Medicaid recipient may seek review through a

Medicaid fair hearing before a DCF, Office of Appeal Hearings' hearing officer, governed by the

procedures set forth at Chapter 28-106 and Rule 65-2.042, et seq., of the Florida Administrative

Code. 42 U.S.C. § 1396a(a)(3); 42 C.F.R. § 431.200(a), (b); 42 C.F.R. § 431.220; 42 C.F.R. §

438.400(a)(l); 42 C.P.R. § 438.402(a); Fla. Admin. Code R. 590-1.010(85) (defining "fair

hearing"); Fla. Admin. CodeR. 65-2.042(3). Cf. 42 C.P.R.§ 431.205(b)(1) (requiring a state's

fair hearing system to provide for a hearing before the state Medicaid agency); 42 C.P.R. §

431.206( d) (permitting a state Medicaid agency to delegate its authority to conduct fair

hearings). Only if DCF affirms the decision to deny prior authorization after a fair hearing will

the denial become final agency action subject to review by an appropriate District Court of

Appeal. § 120.68(1), Fla. Stat.; Fla. Admin. Code R. 65-2.066(4), (7); see also 42 C.P.R. §

431.245. The prior authorization of a provider's request to provide goods or services to a

Medicaid recipient, as described above, should not be confused with pre- or post-payment review

of a provider's Medicaid claims for payment for those goods or services. Compare the above

with§ 409.913, Fla. Stat.;§ 409.9131, Fla. Stat.; Medicaid Provider Reimbursement Handbook,

UB-92 (April 2004) at Pages 2-2, incorporated by reference in Rule 590-4.160, Florida

Administrative Code; Medicaid Provider Reimbursement Provider Handbook, UB-04 at Page 2-

2 (May 2007), incorporated by reference in 590-4.003, Florida Administrative Code.

In reaching his findings of fact and conclusions of law, the ALJ made key mistakes.

Specifically, he erroneously considered the prior authorization process to be a final agency action

with respect to the provider's right to payment, when it is not. Even if the Agency or its agent

grants prior authorization for a Medicaid recipient to receive a good or service, the provider must

still provide the service (if it has not already been provided) and then submit the claim for

payment, in accordance with the requirements of section 409.913(7), Florida Statutes. See also

Florida Medicaid Provider General Handbook at 5-4; Respondent's Exhibit 31 at Pages 34-35. If

AHCA pays the claim, it is still subject to post-payment audit via the procedures described above

and must be repaid if not supported by contemporaneous records, including medical records, that

were provided to AHCA upon request and demonstrate that the good or service was provided in

accordance with the requirements of law and medically necessary to treat an EMC of the

undocumented alien whom DCF has determined to be Medicaid-eligible, as determined by

AHCA's contracted, licensed physician or "peer." See§ 409.913(7)(f), Fla. Stat. Therefore, the

ALJ's conclusion that KePRO's prior authorization approval was a final adjudication of a claim

is patently incorrect; indeed, no claim even existed at the time KePRO made its prior

authorization decision.

Second, the ALJ considered the KePRO's contracted physician's medical review of the

documentation submitted in support of the request for prior authorization to be equivalent to

AHCA's contracted, licensed physician's medical review of the records supporting the paid

claim, which it is not. A request for prior authorization is submitted for a different purpose and

may be accompanied by different documentation, including different medical records, than those

maintained and supplied by the provider in support of a claim for payment. Further, the record

of this case shows that the KePRO prior authorization review was, in fact, markedly different

from the post-payment audit of Respondent's claims. As Shevaun Harris stated, KePRO was

reviewing Respondent's requests for prior authorization in order to determine whether the

inpatient hospital services for a recipient were medically necessary. See Respondent's Exhibit

31 at Pages 12-13. More importantly, at the time KePRO did the prior authorization review it

"would not have known whether or not the person was [an] undocumented alien." Respondent's

Exhibit 31 at Page 14. In contrast, the post-payment audit of Respondent's claims was for the

purpose of determining whether the services Respondent provided to undocumented aliens were

medically necessary to treat an EMC. Since the two reviews are markedly different,

administrative finality has no application here.

In essence, the ALl's conclusions of law violate the principals of statutory construction.

"[I]t is ... an axiom of statutory construction that an interpretation of a statute which relates to an

unreasonable or ridiculous conclusion or a result obviously not designed by the Legislature will

not be adopted." Allied Fid. Ins. Co. v. State, 415 So. 2d 109, 110-11 (Fla. 3d DCA 1982). The

ALl's interpretation of the statutes and rules regarding prior authorization review would lead to

an absurd result if it were allowed to stand. This is highlighted by the case of Agency for Health

Care Administration v. Florida Hospital Orlando, 11-2892MPI (AHCA 2012), which also dealt

with the issue of whether services rendered to undocumented aliens were medically necessary to

treat an EMC, and which AHCA hereby adopts and incorporates by reference. In the Florida

Hospital Orlando case, the ALJ concluded

Prior approval by KeP[RO] does not estop AHCA from pursuing

overpayment claims when an audit does not support the charges

and services billed to Medicaid. AHCA has the daunting task of

chasing monies already paid to providers who may or may not

have submitted accurate or truthful information to KeP[RO]. Prior

approval does not justify payment when contrary to law. AHCA

must always protect the Medicaid funds it is challenged to

conserve so that bona fide recipients receive the medical care they

reqmre.

Recommended Order at Page 11. The ALJ in this case did not even acknowledge the reasoning

set forth in Florida Hospital Orlando on this issue, much less offer a valid explanation as to why

he disagreed with it. Were the Agency to allow the ALJ's findings of fact and conclusions of

law to stand, it would prevent the Agency from fulfilling its responsibilities under state and

federal law since it would not be able to audit any prior authorized claims.

Thus, to the extent Paragraphs 16, 17, 19, 20, 27, 30, 63, 80, 81, 82, 83, 84, 86, 88, 89,

and Endnotes 7 and 15 of the Recommended Order are findings of fact, the findings of fact are

not based on competent, substantial evidence as noted above. To the extent the paragraphs are

conclusions of law, the Agency finds that it has substantive jurisdiction over the conclusions of

law in Paragraphs 16, 17, 19, 20, 27, 30, 63, 80, 81, 82, 83, 84, 86, 88, 89, and Endnotes 7 and

15 of the Recommended Order because it is the single state agency in charge of administering

Florida's Medicaid program, and that it can substitute conclusions of law that are as or more

reasonable than those of the ALJ. Therefore, for these reasons, and also for the reasons stated in

AHCA's rulings on its Exceptions I through III, V, and VI, which are hereby incorporated by

reference, Petitioner's Exception IV is granted to the extent that the Agency rejects Paragraphs

81, 82, 83, 84, 86, 88, 89, and Endnotes 7 and 15 of the Recommended Order in their entirety

(and by extension Paragraph 85 and Endnotes 16 through 19 of the Recommended Order), and

modifies Paragraphs 16, 17, 19, 20, 27, 30, 63 and 80 ofthe Recommended Order as follows:

16. Prior authorization is an administrative adjudication the

determination made by AHCA or its contractor that a provider may

deliver certain goods or services to a Medicaid recipient, here an

undocumented alien determined by DCF to be eligible for

Medicaid due to an EMC. Prior authorization does not relieve the

hospital provider of its affirmative duty to bill true and accurate

claims for goods and services that are medically necessary and

were provided in accordance with the applicable Medicaid rules,

regulations, handbooks, and policies, and federal, state, and local

laws. § 409.913(7)(b), (e), CO, Fla. Stat.; see also Florida Medicaid

Provider General Handbook at 5-4. of the compensability of a

claim, vffiich determines the hospital's substantial interests. Denial

or reduction of a claim entitles the hospital to a hearing which, if

requested, results in a final order. Payment in full of a previously

authorized claim is the equivalent of a final order because AHCA,

signaling the consummation of its decision making process, binds

itself to a course of action, which, being neither tentative nor

interlocutory, affords the hospital complete satisfaction, depriving

the payee of any opportunity or reason to protect its substantial

interests at a later date.7/

17. Pursuant to the prior authorization program, AHCA examined

each claim at issue in this case and prior authorized Respondent to

deliver each good or service.determined that it ·.vas authorized to

be paid by the Medicaid program before the claim Vfa:S presented

for payment. Thereafter AHCA paid each pre-approvedprior

authorized claim upon submission, on the dates, in the amounts,

and for the days of hospitalization shown in the following table:

[TABLE NOT INCLUDED BUT ADOPTED UNCHANGED]

19. An alien recipient is entitled to eligible to receive medical

assistance for emergency care and services that are compensable

under Medicaid and are provided during the period of the

emergency comprising the dates established by DCF in its final

agency action, for the recipient is Medicaid-eligible on those dates

of service, as a matter of Florida law. Medicaid providers who

render services necessary to treat the EMC upon which DCF based

the recipient's eligibility may present a claim to AHCA for

payment under the Medicaid program. Under section 409.913,

Florida Statutes, AHCA is responsible for adjudicating conducting

audits of claims paid in order to determine whether the provider's

claim is authorized to be paid by the Medicaid program, and

AHCA takes final agency action determining the provider's

substantial interests in this regard.

20. If the provider is a hospital, it may receive prior authorization

from AHCA to deliver a good or service to a Medicaid recipient.

Prior authorization is not equivalent to a determination that the

claim subsequently submitted by the hospital should be

paid.AHCA determines prospectively whether the claim is

authorized to be paid, pursuant to the prior authorization program

described above. For other providers not subject to prior

authorization requirements, AHCA determines compensability _gf

claims retroactively, after and audits of previously

paid claims. '.Vhether the adjudication is prospective or

retrospective, hov<'ever, ahca's="" retrospective="" audits="">

considered to be final agency action culminates that may be

challenged by a provider whose substantial interests have been

affected in an administrative process having two parties, i.e.,

AHCA and the provider.

27. As for recouping overpayments from providers, while AHCA

has the authority under section 409.913, Florida Statutes, to

determine whether claims are authorized to be paid by the Florida

Medicaid program, and to recover overpayments and impose

sanctions as appropriate.the power to "re determine" a previously

adjudicated claim is another matter entirely, one which is a

question of state law. And state law, as will be seen, does not

casually permit "do overs" with respect to final agency actions

which determine substantial interests.

30. The Undocumented Alien Project is a program which entails

the retrospective review of hospitals' Medicaid claims, in that the

reason for carrying it out is to adjudicate determine the

compensability of claims that have already been paid. Ex post

facto audits of paid Medicaid claims are authorized under section

409.913, Florida Statutes.commonplace, to be s\\:lfe, but unlike the

typical retrospective review, this project involves the attempted re

adjudication of claims that were already authorized once before, on

a prospective basis. The point has been made, but it bears

repeating: Because of the prior authorization program for hospital

inpatient services, the compensability of each claim selected for

re\\'iew p'l:lfsuant to the Undocumented Alien Project, including

every claim at issue in this case, had already been determined on

the merits by AHCA, \\Vhose decision that the claim was payable

became final agency action upon payment. In effect, then, the

UndocUfllented Alien Project is AHCA's blueprint for revisiting its

mvn prior decisions.

63. This is a good place to pause for a review of the foregoing

findings relating to the Undocumented Alien Project. Purportedly

acting under the aegis of Following a review by CMS, AHCA has

undertaken a comprehensive audit of all previously adjudicated

paid claims for emergency services received by alien recipients

between mid-2005 and mid-20 10, to make fresh findings as to (i)

'.vhether, as DCF found, each recipient had an EMC; and, for each

one who in AHCA='s judgment did, (ii) the emergency was

"alleviated" sometime during the DCF determined "period of the

emergency." The purpose of this retrospective review is to recoup,

as overpayments, amounts disbursed for any and all goods or

services provided (i) to aliens who, in AHCA's view, never had an

EMC or (ii) after a recipient's AHCA-determined "date of

alleviation."

80. As may be recalled, AHCA implemented a prior authorization

program for hospital inpatient services in 2002 and, pursuant to

that program, reviewed preliminarily determined that Respondent

was allowed to provide the goods or services and submit and

determined the compensability of every claim at issue in this case

prospective!)', i.e., before it was presented to AHCA for payment.

Respondent still had an affirmative duty to bill true and accurate

claims for goods and services that are medically necessary and

were provided in accordance with the applicable Medicaid rules,

regulations, handbooks, and policies, and federal, state, and local

laws. § 409.913(7)(b), (e), Fla. Stat.; see also Florida Medicaid

Provider General Handbook at 5-4. As it happened, the Agency

found on the merits, years before bringing this action, that all of

the amounts for which Gulf Coast sought compensation were

authorized to be paid by Medicaid. Each prior authorization of a

claim constituted agency action. § 120.52(2), Fla. Stat. When the

Agency actually paid the pre approved claim, as it did every one of

the claims at issue here, that agency action became final, because

AHCA bound itself to a course of action which determined both

parties' rights and obligations, consummating a free form decision

making process.15/ See Save Our Creeks & Envtl. Confed'n of Sw.

Fla. v. Fish & 'Nildlife Conser. Comm'n, 112 So. 3d 128, 130 (Fla.

1st DCA 2013); cf. Bennett v. Spear, 520 U.S. 154, 177 78, 117 S.

Ct. 1154, 1168, 137 L. Ed. 2d 281, 305 (1997).

Exception V

In Exception V, Petitioner takes exception to Paragraphs 90 through 94 of the

Recommended Order, arguing that the ALJ erred in concluding that the "plain language" of

section 409.905(5)(a), Florida Statutes, barred the Agency from conducting the audit at issue in

this case. Instead, Petitioner argues that section 409.905(5)(a), Florida Statutes, does not apply

to this matter because the "review" referenced in that section is different from the review

Petitioner conducted in this matter. The Agency agrees with Petitioner. As stated in the ruling

on Exception IV supra, there is a universal rule that a statutory provision will not be construed in

such a way that it renders meaningless or absurd any other statutory provision. See Amente v.

Newman, 653 So. 2d 1030 (Fla. 1995). The ALJ has violated that universal rule by interpreting

the language in the last sentence of section 409.905(5)(a), Florida Statutes, to prohibit the

Agency from conducting audits like the one at issue in this case.

The Legislature has authorized AHCA and/or its contractor to conduct both pre-payment

reviews of providers' Medicaid claims to ensure they are billed in accordance with state and

federal Medicaid law and retrospective reviews and/or audits of providers' paid Medicaid claims

to identify any overpayments. § 409.913(2), (3), (5), Fla. Stat. "'Overpayment' includes any

amount that is not authorized to be paid by the Medicaid program whether paid as a result of

inaccurate or improper cost reporting, improper claiming, unacceptable practices, fraud, abuse,

or mistake." § 409.913(l)(e), Fla. Stat. AHCA "shall" deny payment or require repayment of

any overpayment for services not provided and billed for in accordance with federal and state

Medicaid law. § 409.913(l)(e), (7), (11), (15), (27), Fla. Stat. Federal law requires state

Medicaid agencies to provide procedures for post-payment claims review in order to ensure a

provider's compliance with Medicaid law. See 42 U.S.C. § 1396a(a)(37)(B); 42 C.F.R.

§ 447.253(g) (stating "[t]he Medicaid agency must provide for periodic audits of the financial

and statistical records of participating providers"). These utilization reviews/audits of Medicaid

providers are performed retrospectively. § 409.913(2), Fla. Stat.; see also Goldstar Med. Servs.,

Inc. v. Dep't of Social Servs., 955 A. 2d 15, 26 (Conn. 2008) (recognizing that Medicaid

" [a ]udits, by their inherent nature, are retrospective; they determine the accuracy of claims

submitted and payments made after the fact"). If section 409.905(5)(a), Florida Statutes, was a

bar to the Agency performing audits like the one at issue in this case, it would result in a

violation of federal law, which requires the Agency to conduct such audits.

For these reasons, and also for the reasons stated in AHCA's rulings on its Exceptions I

through IV and VI, which are hereby incorporated by reference, the Agency finds that it does

have substantive jurisdiction over the conclusions of law in Paragraphs 90 through 94 of the

Recommended Order because it is the single state agency in charge of administering Florida's

Medicaid program, and that it can substitute conclusions of law that are as or more reasonable

than those of the ALJ. Therefore, the Agency grants Petitioner's Exception V and rejects the

conclusions oflaw in Paragraphs 90 through 94 of the Recommended Order in their entirety.

Exception VI

In Exception VI, Petitioner takes exception to Paragraphs 46, 47, 59, 64, 96, 109, 110,

and 114 of the Recommended Order, arguing that the ALJ departed from the essential

requirements of law by making the findings of fact and conclusions of law in these paragraphs

because they pertained to issues that neither party had raised in this case. The Agency agrees.

Generally, section 120.57(1)(b), Florida Statutes, states that "[a]ll parties shall have an

opportunity to respond, to present evidence and argument on all issues involved" in a case.

Here, the ALJ raised the following issues sua sponte after the hearing had concluded, such that

AHCA had no meaningful "opportunity to respond, present evidence and argument" on these

Issues:

• The constitutionality Issue discussed m Paragraphs 46 and 4 7 of the

Recommended Order;

• The issue whether an application for medical assistance under the Medicaid

program is analogous to a licensure application in Paragraph 59 of the

Recommended Order; and

• The issue of the application of case law governing the interpretation of insurance

policies to this case that the ALJ raised in Paragraphs 1 09 and 11 0 of the

Recommended Order.

Indeed, neither Respondent's Amended Petition nor the parties' Joint Pre-Hearing Stipulation

raises these issues, nor were they addressed at the hearing. Further, DOAH is an administrative

agency; therefore, the ALJ lacked the authority to rule on constitutionality issue that he raised

raised in Paragraphs 46 and 47 of the Recommended Order. See, e.g., Gulf Pines Mem'l Park,

Inc. v. Oaklawn Mem'l Park, Inc., 361 So. 2d 695, 700 (Fla. 1978); Fla. Hosp. v. Ag. for Health

Care Admin., 823 So. 2d 844, 849 (Fla. 1st DCA 2002). As such, the ALJ departed from the

essential requirements of law by raising and addressing these issues for the first time in its

Recommended Order.

AHCA asserts it has the authority to modify both findings of fact and conclusions of law

when there is a lack of compliance with the essential requirements of law, although the phrase

"did not comply with the essential requirements of law" is contained in the sentence of section

120.57(1 )(/), Florida Statutes, that pertains to the rejection or modification of findings of fact.

Quite simply, AHCA cannot allow a conclusion of law that was entered without compliance with

- and thus in violation of- the essential requirements of law to stand.

For these reasons, and also for the reasons stated in AHCA's rulings on its Exceptions I

through V, which are hereby incorporated by reference, the Agency grants Petitioner's Exception

VI to the extent that it rejects Paragraphs 46, 47, 109 and 110 of the Recommended Order (and

by extension Endnote 20 of the Recommended Order) in their entirety, and modifies Paragraphs

59 and 114 ofthe Recommended Order to state:

59. It is important to recognize that when DCF approves an

individual alien's application for medical assistance and issues that

person a Medicaid card or other notice signifying that the person is

a recipient, DCF is conferring a legal status upon that person which

entitles him to receive benefits from providers for which Medicaid

must pay. The application for medical assistance initiates a

transaction between the applicant and DCF to which no one else is

a party--not AHCA, not the providers. The determination of

eligibility of an individual alien, however, is separate and distinct

from AHCA's review of claims for payment by hospital providers

for services provided to that alien, which may only be approved if

the services provided are covered by Medicaid.In this respect, the

application for medical assistance is analogous to an application

for licensure, and the issuance of a Medicaid card or other notice

of approval is somevihat akin to the issuance of a license. The

point is that once DCF confers recipient S{atus on an applicant,

AHCA (and the providers) must respect and accept that status, juS{

as AHCA (and the providers) must respect and accept other legal

credentials, such as professional licenses, vihich are conferred by

governmental authorities having the power to issue them.

114. This is an interesting and close question of first impression,

and it would be useful to have an authoritative decision on the

subject. The undersigned has elected to punt the issue this time,

however, inasmuch as he would rather address the question in a

case where there are not a half-dozen or so other, potential separate

grounds for finding the provider not liable as alleged.

The Agency will make no further modifications to Paragraph 64 of the Recommended Order

beyond those enumerated in the ruling on Petitioner's Exception II supra. The Agency will make

no further modifications to Paragraph 96 of the Recommended Order beyond those enumerated

in the ruling on Petitioner's Exception I supra.

FINDINGS OF FACT

The Agency adopts the findings of fact set forth in the Recommended Order, except

where noted supra. 5

CONCLUSIONS OF LAW

The Agency adopts the conclusions of law set forth in the Recommended Order, except

where noted supra.

IT IS THEREFORE ADJUDGED THAT:

Respondent is hereby required to repay $46,901.85 in overpayments, plus interest at a

rate of ten (1 0) percent per annum as required by Section 409 .913(25)( c), Florida Statutes, to the

Agency. Respondent shall make full payment of the overpayment to the Agency for Health Care

Administration within 30 days of the rendition date of this Final Order unless other payment

arrangements have been agreed to by the parties. Respondent shall pay by check payable to the

Agency for Health Care Administration and mailed to the Agency for Health Care

Administration, Office of Finance and Accounting, 2727 Mahan Drive, Mail Stop 14,

Tallahassee, Florida 32308.

5 The Agency does not agree with the finding of fact in the last sentence of Paragraph 29 of the Recommended

Order, but will leave it unchanged since Petitioner failed to take exception to it.

,

DONE and ORDERED this 4 day of 2016, in Tallahassee,

Florida.

UDEK, SECRET A

HEALTH CARE ADMINISTRATION

NOTICE OF RIGHT T DICIAL REVIEW

A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO

JUDICIAL REVIEW, WHICH SHALL BE INSTITUTED BY FILING THE ORIGINAL

NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A COPY ALONG

WITH THE FILING FEE 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 THE RENDITION OF THE

ORDER TO BE REVIEWED.

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true and correct copy of the foregoing Final Order has

been furnished by U.S. or interoffice mail to the persons named below on this

ftl ,2016.

RICHARD J. SHOOP, Agency Clerk

Agency for Health Care Administration

2727 Mahan Drive, MS #3

Tallahassee, Florida 32308

[phone]

COPIES FURNISHED TO:

Honorable John G. Van Laningham

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(via electronic filing)

Joseph M. Goldstein, Esquire

Jacqueline Howe, Esquire

Shutts and Bowen LLP

200 East Broward Boulevard, Suite 21 00

Fort Lauderdale, Florida 33301

(via U.S. Mail)

Daniel Elden Nordby, Esquire

Shutts and Bowen LLP

215 South Monroe Street, Suite 804

Tallahassee, Florida 32301

(via U.S. Mail)

Joanne Barbara Erde, Esquire

Donna Holshouser Stinson, Esquire

Duane Morris LLP

200 South Biscayne Boulevard, Suite 3400

Miami, Florida 33131

(via U.S. Mail)

Medicaid Program Integrity

Office of the Inspector General

Medicaid Accounts Receivable

Finance & Accounting