01-004078MPI Agency For Health Care Administration vs. Pierre Gaston, M.D. Status: Closed Recommended Order on Friday, April 19, 2002.

Summary: Petitioner proved that off-label use of intravenous immunoglobulin for treatment of HIV-infected adults was not medically necessary.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

AGENCY FOR HEALTH CARE )

ADMINISTRATION, )

)

Petitioner, )

)

vs. ) Case No. 01 - 4078MPI

)

PIERRE GASTON, )

)

Respondent. )

______________________________)

RECOMMENDED ORDER

Robert E. Meale, Administrative Law Judge of the Division

of Administrative Hearings, conducted the final hearing by

videoconference in Tallahassee and Miami, Florida, on January 24

and 25, 2002.

APPEARANCES

For Petitioner: Anthony L. Conticello, S enior Attorney

Agency for Health Care Administration

2727 Mahan Drive, Suite 3431

Fort Knox Building III

Tallahassee, Florida 32308

For Respondent: Louise T. Je roslow

Law Offices of Louise T. Jeroslow

6075 Sunset Drive, Suite 201

Miami, Florida 33143

STATEMENT OF THE ISSUES

The issues are whether Petitioner has overpaid Respondent

for medical services for which he has obtained re imbursement

under the Medicaid program and, if so, by how much.

PRELIMINARY STATEMENT

By letter dated July 31, 2001, Petitioner notified

Respondent that it had reviewed his Medicaid claims for

specified procedures from January 1, 1996, through August 19,

2000, and determined that Petitioner had overpaid Respondent

$75,387.91 for claims arising from "off - label" use of immune

globulin and interleukin 2.

By Request for Formal Administrative Hearing filed

September 24, 2001, with Petitioner, Respondent deni ed the

material allegations and requested a formal hearing.

At the hearing, Petitioner stipulated that it would reduce

its overpayment claim by the total of five items listed on page

two of Petitioner Exhibit 27. These items, bearing a date of

service of March 14, 1997, state amounts paid of $9.04, $22.41,

$22.42, $1224.00, and $10.00, for a total of $1287.87. Thus,

the total alleged overpayment is now $74,100.04.

At the hearing, Petitioner called three witnesses and

offered into evidence 24 exhibits: Petitioner Exhibits 1 - 6,

8 - 9, 11 - 16, and 18 - 27. Respondent called one witness and

offered into evidence one exhibit: Respondent Exhibit 1. All

exhibits were admitted.

FINDINGS OF FACT

1. Respondent is a licensed physician engaged in the

practice of me dicine in Florida. From January through November

1997, Respondent worked a couple of hours each morning at the

Summit Clinic in Miami before seeing patients at his own office.

2. At the Summit Clinic, Respondent administered

intravenous immunoglobulin (I VIG) to adult Medicaid patients who

were infected with human immunodeficiency virus (HIV).

Petitioner paid the Summit Clinic, which was using Respondent's

Medicaid provider number, for these and other medical services.

Petitioner now claims that these IV IG services were not

medically necessary, and, pursuant to its "pay - and - chase"

policy, Petitioner seeks repayment from Respondent.

3. In general, the administration of IVIG transfers

antibodies contained in globulin to protect the recipient from

various i nfectious microorganisms. The United States Food and

Drug Administration (FDA) has approved the marketing of IVIG for

the treatment of persons with certain clinical conditions, such

as idiopathic thrombocytopenic purpura, Kawasaki disease, and

pediatric H IV infection.

4. However, the FDA has not approved the marketing of IVIG

for the treatment of adult HIV infection. The use of a drug to

treat conditions for which the FDA has not issued its approval

is known as an off - label use. Some off - label uses are medically

effective and prevalent, but remain unapproved by the FDA

because the drug manufacturer cannot feasibly conduct expensive

clinical trials generally necessary to obtain FDA marketing

approval. Despite the absence of such clinical trials, not all

off - label uses are experimental.

5. In the 20 years that IVIG has been commercially

available in the United States, medical researchers and

practitioners have uncovered evidence in support of important

off - label uses of IVIG. For instance, a common and e ffective

off - label use of IVIG is for the treatment of Guillain - Barr é

syndrome. According to the University HealthSystem Consortium,

the FDA estimates that 50 - 70 percent of IVIG use is off - label,

but as much as half of the off - label use finds little, if a ny,

support by clinical studies.

6. This case raises the question of the medical necessity

of the off - label use of IVIG for the treatment of HIV - infected

adults. Unlike adult - onset HIV infections, pediatric HIV

infections result in systemic immune defici encies because the

children's immune systems never develop normally. In HIV -

infected children, IVIG relieves the effects of these systemic

immune deficiencies by preventing serious bacterial infections.

For these reasons, the FDA has approved the use of IVIG for HIV -

infected children.

7. By letter dated July 31, 2001, Petitioner advised

Respondent that it had reviewed various Medicaid claims

submitted under his provider number. As relevant to this case,

the July 31 letter disallows Medicaid reimbursemen t for the use

of IVIG on HIV - infected adults. Stating that this use of IVIG

is not "indicated" and is "investigational," the letter adds:

"Medicaid policy prohibits payment for experimental procedures

or non - FDA approved drugs and requires that all servi ces

rendered to Medicaid recipients be medically necessary."

8. Chapter 1 of the Physician Coverage and Limitations

Handbook (Handbook) states: "Medicaid reimburses for services

that are determined medically necessary . . .. In addition, the

services mu st meet the following criteria:

* the services must be individualized,

specific, consistent with symptoms or

confirmed diagnosis of the illness or injury

under treatment, and not in excess of the

recipient's needs;

* the services cannot be experimental or

investigational;

* the services must reflect the level of

services that can be safely furnished, and

for which no equally effective and more

conservative or less costly treatment is

available statewide; and

* the services must be furnished in a

mann er not primarily intended for the

convenience of the recipient, the

recipient's caretaker, or the provider.

9. The Handbook also provides: "Medicaid does not

reimburse for non - FDA approved medications. Medicaid does not

reimburse procedures that are ex perimental or when non - FDA

approved medications are included in the procedures."

10. The Medicaid Provider Reimbursement Handbook

(Reimbursement Handbook) defines "experimental or clinically

unproven procedures" as: "Those newly developed procedures

unde rgoing systematic investigation to establish their role in

treatment or procedure that are not yet scientifically

established to provide beneficial results for the condition for

which they are being used."

11. Although not directly applicable to the Medic aid

program, Section 2049.4 of Chapter II, Part 3, Health Care

Financing Administration Carriers Manual (HCFA Manual) states,

in part:

Use of the drug or biological must be safe

and effective and otherwise reasonable and

necessary. . . . Drugs or biolog icals

approved for marketing by the [FDA] are

considered safe and effective for purposes

of this requirement when used for

indications specified on the labeling.

Therefore, you may pay for the use of an FDA

approved drug or biological if:

* It was injec ted on or after the date of

the FDA's approval;

* It is reasonable and necessary for the

individual patient; and

* All other applicable coverage

requirements are met.

* * *

An unlabeled use of a drug is a use that is

not i ncluded as an indication on the drug's

label as approved by the FDA. FDA approved

drugs used for indications other than what

is indicated on the official label may be

covered under Medicare if the carrier

determines the use to be medically accepted,

takin g into consideration the major drug

compendia, authoritative medical literature

and/or accepted standards of medical

practice. . . .

12. Accordingly, the Florida Medicare Local Medical Review

Policy manual recognizes the use of IVIG for pediatric HIV

in fections, but warns: "IVIG is not indicated for use in adult

HIV patients . . .."

13. Except for the administration of IVIG, Respondent

provided state - of - the - art services to HIV - infected adults. The

present record contains scant medical evidence of the

effectiveness of IVIG in treating HIV - infected adults. Against

considerable evidence questioning the medical necessity of IVIG

in treating HIV - infected adults, Respondent offered undocumented

anecdotal evidence of successful use of IVIG among his adult

pa tients and two synopses of undisclosed preliminary data

suggesting effectiveness of IVIG in HIV - infected adults.

Respondent did not effectively oppose Petitioner's explanation

for the differences in IVIG's effectiveness in treating adults

and children, no r did Respondent offer any rationale for his

claim of IVIG's effectiveness in HIV - infected adults. On this

record, Petitioner has demonstrated that the use of IVIG to

treat HIV - infected adults is not effective and, thus, not

medically necessary.

CONCLUSI ONS OF LAW

14. The Division of Administrative Hearings has

jurisdiction over the subject matter. Section 120.57(1),

Florida Statutes. (All references to Sections are to Florida

Statutes.)

15. As the parties stipulated, Petitioner has the burden

of prov ing that it is entitled to repayment of Medicaid payments

that it has made pursuant to claims submitted under Respondent's

provider number.

16. Section 409.905(9) limits reimbursements to services

that are "medically necessary" for the treatment of an inj ury,

illness, or disease. However, Section 409.905(9) prohibits

reimbursements for services that are "clinically unproven,

experimental, or for purely cosmetic purposes."

17. Section 409.913(1)(c) defines "medically necessary"

as:

any goods or services n ecessary 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. For

purposes of determining Medicaid

reimbursement, the agency is the final

arbiter of medical necessity.

Determinations of medical necessity must be

made by a licensed ph ysician employed by or

under contract with the agency and must be

based upon information available at the time

the goods or services are provided.

18. Section 409.913(10) states that Petitioner may require

that a provider reimburse the Medicaid program f or

"inappropriate, medically unnecessary, or excessive goods or

services."

19. The statutes clearly provide that Medicaid

reimbursements extend only to services that are medically

necessary, as determined by generally accepted standards of

medical practic e, and that are not clinically unproven or

experimental. The statutes do not address explicitly Medicaid

reimbursement for off - label uses of drugs. Nor do the statutes

implicitly preclude Medicaid reimbursement for off - label uses of

drugs.

20. Not all o ff - label uses are experimental or

investigational. Off - label uses lack the clinical trials that

support FDA - approved uses, but significant medical evidence

other than that derived from formal clinical trials may support

off - label uses. Such off - label use s are no longer experimental

or investigational.

21. Not all off - label uses are medically unnecessary.

Many off - label uses, such as the use of IVIG to treat Guillain -

Barr é, are effective. Florida statutes do not equate FDA

approval with medical necessit y; instead, they refer to

generally accepted standards of medical practice.

22. The Handbook reinforces the requirement of medical

necessity. The Handbook's prohibition against reimbursement for

non - FDA approved drugs does not prohibit reimbursement for all

off - label uses; instead, it prohibits reimbursement for drugs

that have not received FDA approval for any use.

23. The Reimbursement Handbook does not prohibit

reimbursement for all off - label uses. The Reimbursement

Handbook prohibits reimbursement f or "newly developed" drugs or

uses whose efficacy has not been scientifically established.

Again, some off - label uses are not newly developed, but are

instead supported by significant medical evidence.

24. The HCFA Manual explicitly recognizes that off - l abel

uses may be reimbursed, if such uses are supported by medical

evidence.

25. In sum, the handbooks and manuals do not enlarge upon

the statutes by categorically prohibiting reimbursements for all

off - label uses. Suggesting a categorical prohibition a gainst

Medicaid reimbursement only for drugs that have received no FDA

approval for any use whatsoever, the handbooks and manuals allow

Medicaid reimbursement for any off - label use whose effectiveness

is demonstrated by medical evidence.

26. On this recor d, Petitioner has proved that

Respondent's administration of IVIG to HIV - infected adults was

not effective and thus was not medically necessary.

RECOMMENDATION

It is

RECOMMENDED that the Agency for Health Care Administration

enter a final order ordering Respondent to reimburse the

Medicaid program $74,100.04 in overpayments for services that

were not medically necessary.

DONE AND ENTERED this 19th day of April, 2002, in

Tallahassee, Leon County, Florida.

_______________________ ____________

ROBERT E. MEALE

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalac hee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675 SUNCOM 278 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 19th day of April, 2002.

COPIES FURNISHED:

Virginia A. Daire, Agency Clerk

Agency for Health Care Administration

2727 Mahan D rive

Fort Knox Building, Suite 3431

Tallahassee, Florida 32308

William Roberts, Acting General Counsel

Agency for Health Care Administration

2727 Mahan Drive

Fort Knox Building, Suite 3431

Tallahassee, Florida 32308

Anthony L. Conticello, Senior Attor ney

Agency for Health Care Administration

2727 Mahan Drive, Suite 3431

Fort Knox Building III

Tallahassee, Florida 32308

Louise T. Jeroslow

Law Offices of Louise T. Jeroslow

6075 Sunset Drive, Suite 201

Miami, Florida 33143

NOTICE OF RIGHT TO SUBMIT E XCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this recommended order. Any exceptions

to this recommended order must be filed with the agency that

will issue the final order in this case.